Middle East: Bain & Company has released a new brief, Perform Today, Prove Tomorrow, Propel the Stock Valuation, highlighting how leading banks earn investor confidence by aligning clear strategy, strong execution, and a credible equity story. The research reveals that banks’ valuations vary widely not based on business model but on strategic clarity, cost discipline, and consistency of delivery.

While return on equity (ROE) remains important, Bain’s analysis shows it explains less than half of valuation variation. The remaining value often lies in a bank’s narrative and its ability to articulate where it’s going and how it will win. High-performing banks balance “today forward” actions like digital efficiency and cost control with “future back” strategies that prepare for new technologies, competitors, and customer expectations.

The report includes examples showing how disciplined growth choices and early adoption of AI tools can lead to strong price-to-book ratios, even in traditionally low-growth sectors. By contrast, banks that fail to adapt or spread themselves too thin often suffer low investor confidence despite sound financials.

The report emphasizes that banks with higher valuations excel at demonstrating both current performance and future potential. They articulate a compelling narrative grounded in their strategic choices, whether investing in technology, reshaping their business mix, or expanding fee income, and back it with tangible proof points. This blend of clarity and credibility builds investor trust and supports stronger valuation multiples.

Bain concludes that banks seeking valuation premiums must go beyond traditional metrics and clearly demonstrate relevance, capability, and long-term ambition. A credible equity story, grounded in performance and forward-looking strategy, is key to unlocking higher shareholder returns and renewed relevance in a shifting financial landscape.

The full brief is available at: www.bain.com

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Editor’s Note – For interviews or further information, please contact:
Christine Abi Assi – christine@daydreamer.agency  

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