Kenya’s First Local ETF Targets KSh 1.64Trillion Banking Sector After CMA Approval

Kenya’s first local Exchange Traded Fund is set to debut on the Nairobi Securities Exchange after receiving regulatory approval, giving investors a new route into a banking sector valued at about KSh 1.64Trillion and backed by KSh 287.73Billion in combined 2025 profits across the 11 index constituents.

• The Capital Markets Authority (CMA) has given approval for the listing of the WSA Banking Index ETF on the NSE, making it the third ETF on the exchange after Absa NewGold ETF and the Satrix MSCI World Feeder ETF, but the first to be locally domiciled.
• Issued by Wall Street Africa Group in partnership with Tradiam Asset Managers, the fund is expected to list on the NSE’s Main Investment Market Segment in the fourth quarter of 2026, subject to completion of the remaining listing and operational requirements.
• The ETF will be structured as an open-ended scheme and seek to replicate the NSE Banking Index by investing in its constituent banking shares, allowing investors to gain diversified exposure to the sector through a single exchange-traded security.

CMA Chief Executive Wyckliffe Shamiah said the product aligns with the regulator’s push to facilitate innovative investment products, broaden diversification opportunities and deepen the capital markets.

Banking Rally Meets Record Market

The approval comes during one of the strongest periods for Kenyan equities in recent years. The NSE crossed KSh 4Trillion in total market capitalization for the first time this month, less than nine months after crossing KSh 3Trillion.

Banking has emerged as the largest sector within that market. Listed banks currently command approximately KSh 1.64Tn, equivalent to about 41% of the entire NSE, ahead of telecommunications at roughly KSh 1.43Tn. Safaricom remains the exchange’s largest individual company, but collectively listed banks represent the bourse's largest concentration of market value.

The sector's rise has also been broad-based. The NSE Banking Sector Index has gained 62% since its launch in October 2025 and had returned 30.9% in 2026 through July, outperforming the major NSE equity indices and bonds.

Individual counters have continued the rally. I&M Holdings is up about 60% year-to-date, Stanbic Holdings 48%, Co-operative Bank 46%, BK Group 41%, Absa Bank Kenya 35% and Diamond Trust Bank about 35%.