| |
Wednesday 22nd of May 2013 |
Morning Africa |
Register and its all Free.
If you are tracking the NSE Do it via RICHLIVE and use Mozilla Firefox as your Browser. 0930-1500 KENYA TIME Normal Board - The Whole shebang Prompt Board Next day settlement Expert Board All you need re an Individual stock.
The Latest Daily PodCast can be found here on the Front Page of the site http://www.rich.co.ke
Africa's quest for sustained economic growth Inside Story @AJELive @AJEnglish Africa http://www.aljazeera.com/programmes/insidestory/2013/05/201351184230371482.html
#Africa 's quest for sustained economic growth @AJELive @AJEnglish Twitpic http://www.twitpic.com/cpzhur
I am looking forward to hosting @HabilOlaka of the @KenyaBankers at #Mindspeak on Saturday 25th May http://twitpic.com/cprlag
#Mindspeak is held at @InterConNairobi http://twitpic.com/cm03ub
We serve Breakfast from 9 am The Program starts at 1000 http://www.twitpic.com/8oc8q7
#Mindspeak 2013 RICH TV http://www.rich.co.ke/rctools/richtv.php
Macro Thoughts
Home Thoughts
The Little One told me She wants to be a Palaeontologist and I said You can be whatever You want.
Her Teacher Mrs. Nightingale has been a Revelation.
SAN MARCO, the flagship of NATO’s counter-piracy Operation OCEAN SHIELD, conducted the first-ever visit to Madagascar by a NATO warship this past week @NATO_MARCOM http://www.mc.nato.int/PressReleases/Pages/NATO-Flagship-Conducts-First-Ever-Visit-to-Madagascar.aspx
SAN MARCO, the flagship of NATO’s counter-piracy Operation OCEAN SHIELD in Mombasa Twitpic http://www.twitpic.com/co2dc1
The Deck San Marco #Mombasa Twitpic http://www.twitpic.com/co7ap7
What an Adventure with the Folks of Operation Ocean Shield San Marco Twitpic http://www.twitpic.com/cofvuo
06-MAY-2013 #Somalia2013 The Next Big Thing [Piracy, NATO, The London Conference and the San Marco] http://www.rich.co.ke/media/docs/036NSX0605.pdf
HER Excellency Paola Imperiale the Italian ambassador to Kenya whose surname is a linguistic clue to her style of diplomacy, invited me to a party over the weekend on the San Marco, in Mombasa. As I surveyed the crowd, I said to Nishet, it is clear that Paola’s invitations are not turned down lightly. I attended the ‘Presser’ in the morning and was Sinvited by the Rear Admiral Antonio Natale to join his crew on an exercise out on the Indian Ocean on Sunday and then be flown back to Mombasa via one of their helicopters. So as I write this, I cannot help wishing I could communicate with my ancestors who came to Africa on a dhow and I am sure would have appreciated the speedier transport of the Italian navy.
Rear Admiral Natale is the Commander of Standing NATO Maritime Group (SNMG2) assigned to NATO’s counter piracy mission, Operation Ocean Shield. And during his press conference he confirmed that so far in 2013 there were no attacks, approaches or disruptions in the area [The area covers the Horn of Africa, including the Gulf of Aden and the Western Indian Ocean up to the Strait of Hormuz. An area greater than 2 million square miles or approximately the size of Western Europe].
Tim Carstens whom I met through Ambassador @GeoffTooth and is the MD of Base Resources has readied his Rhino Charge Vehicle http://www.twitpic.com/csb88k
#Mindspeak with Tim Carstens RICH TV http://www.rich.co.ke/rctools/richtv.php?d=MjAxMi0xMi0zMQ%3D%3D |
| read more |
|
Syria highlights US political impotence Asia Times Law & Politics |
"Nothing illustrates more the limitations of Western power than the internal controversy its elites are having in public about what the United States in particular and Western European states should be doing about the civil war in Syria."
Those limitations are palpable in both language and action. A political and military vacuum created by past US failures and forced retreats after the Iraq war made it possible for countries like Russia to reemerge on the scene as an effective player.
Concurrently, Russia's position remains unswerving and constantly advancing while the US is pushed into a corner, demonstrating an incapacity to react except for condemnations and mere statements. Much to the displeasure of its Arab allies.
Russia's recent delivery of sophisticated anti-ship missiles and its own buildup of warships in the eastern Mediterranean is a case in point. The move was condemned by the Obama administration as one that is "ill-timed and very unfortunate".
The current American political impotence in the Middle East is unprecedented, at least since the rapid disintegration of the Soviet bloc in the early 1990s.
In this new reality, the US is incapable of reshaping reality but merely trying to offset or control its unfavorable outcomes.
"What the United States (and western Europe) want to do is 'control' the situation," Immanuel Wallerstein argued. "They will not be able to do it. Hence the screams of the 'interventionists' and the foot-dragging of the 'prudent.' It is a lose-lose for the west, while not being at the same time a 'win' for people in the Middle East."
This "lose-lose" scenario might not necessarily translate to a complete American foreign policy meltdown in the near future, but will certainly open the possibility for new/old players to main serious gains, Russia being a lead example. This will likely compel the US to change tactics.
Middle East and North Africa: Defining the Road Ahead IMF http://www.imf.org/external/pubs/ft/reo/2013/mcd/eng/pdf/mcdreo0513.pdf
Two years after the “Arab Spring” commenced, many countries of the Middle East and North Africa (MENAP)1 region are still undergoing complex political, social, and economic transitions. Economic performance was mixed in 2012: although most of the region’s oil-exporting countries grew at healthy rates, economic growth remained sluggish in the oil importers. In 2013, these differences are expected to narrow because of a scaling-back of hydrocarbon production among oil exporters and a mild economic recovery among oil importers.
Growing regional economic and social spillovers from the conflict in Syria add to the complexity of the economic environment.
The Arab countries in transition are Egypt, Jordan, Libya, Morocco, Tunisia, and Yemen.
Conclusions
Its hardly a Spring is it? Its practically dystopian.
"The illness of President Bouteflika will soon be no more than a bad memory," he said Reuters http://www.reuters.com/article/2013/05/21/us-algeria-bouteflika-sellal-idUSBRE94K0G620130521
Since he was rushed to hospital in Paris on April 27 with what was officially described as a minor stroke, Bouteflika has been neither heard nor seen in public, raising widespread speculation that he is seriously ailing.
France's Le Point magazine said Bouteflika, who was treated for cancer in 2005, was in very poor health, with some of his vital functions damaged. Algerian newspaper editor Hichem Aboud said he was in a deep coma and had been brought back to Algeria.
Japan tips its hand via North Korea Asia Times http://www.atimes.com/atimes/Japan/JAP-02-210513.html
The big story in Asia affairs today is a little trip that was supposed to stay a secret: the dispatch of Isao Iijima, adviser to Japan's Prime Minister Shinzo Abe, to meet with senior officials in North Korea, thereby breaking the united US/South Korean/Japanese front in negotiations with Pyongyang.
It is the first instance of an overt divergence between Japanese and US diplomatic and security strategies, something that has been implicit in Japan's sometimes-inflammatory brand of nationalism under Prime Minister Shinzo Abe - and Abe's determination to move Japan beyond its traditional role of obedient US ally to independent regional force.
The United States has been quietly disapproving of Japan's China strategy - witness Kurt Campbell's statement that the US advised Japan against nationalizing the Senkaku islands - and provocative nationalist hi-jinks on issues like the Yasukuni Shrine, but excused them as politically motivated exercises in domestic base-pandering.
However, the North Korean trip has revealed the cloven hoof beneath the robe, as far as Japan's independent aspirations in Asia are concerned.
Japan Times made it clear that the US was not consulted in advance about the trip; US special representative for North Korea Glyn Davies was only briefed after the visit: Japan briefed the United States on Thursday about the surprise visit to North Korea by an adviser to Prime Minister Shinzo Abe.
After meeting with his Japanese counterpart in Tokyo, Glyn Davies, US. special representative for North Korea policy, said he hopes to gain more "insights" into Isao Iijima's unannounced trip in the coming days. ...
The Christian Science Monitor calls it from the US side: "Japan's 'secret' trip to North Korea disrupts united stance against Pyongyang." [2] South Korea was less circumspect:
"It is important to maintain close coordination, among South Korea, the US and Japan, toward North Korea," said [South Korean] Foreign Ministry spokesman Cho Tai-young in a media briefing. "In that sense, we think that the visit by Iijima to North Korea is unhelpful."
As the celebratory circle jerk of stock market punters over the soaring Nikkei continues, it should be noted that for the first time since 1998 the growth rate of yen-weakened Japan will exceed that of South Korea.
In an article excoriating Japan's approach to North Korea, Korea Times' Kim Tae-gyu detoured into trade and economic grievances: Beggar-thy-neighbor policy
Abe's flagship economic policy of depreciating the country's currency to boost the price competitiveness of made-in-Japan products is also under criticism as it tries to galvanize its economy at the expenses of its neighbors.
Critics say the Abe administration's large-scale monetary easing and the resultant fast devaluation of the yen are tantamount to economic aggression toward Asian nations.
The weakening of currency of the world's No 3 economy spills over to its rivals in international markets such as Korea and China whose exporters are now panicking - it is the very essence of a "beggar-thy-neighbor" policy.
The yen was traded near a historical high of 78 yen to the dollar last year but it now fluctuates in the vicinity of 100. Many global agencies expect that the depreciation is only halfway done as it is likely to further rise to around 120 yen by the end of next year.
The weakening yen has breathed fresh life into its moribund economy, which experienced a two-decade slump. By contrast, Korean and Chinese exporters that compete with Japanese ones are complaining about their substantially reduced bottom lines.
Conclusions
Whilst Japan is evidently the Point Man of @BarackObama 's Pivot to Asia, @AbeShinzo 's very much Japan First Philosophy means he is unlikely to take orders.
North Korean Leader Kim Jong Un Sends Special Envoy to China Bloomberg http://www.bloomberg.com/news/2013-05-22/north-korean-leader-kim-jong-un-sends-envoy-to-china-correct-.html
North Korean leader Kim Jong Un sent a “special envoy” to China as ties with his biggest benefactor showed signs of strain over the North’s nuclear ambitions and the seizure of a Chinese fishing boat.
Choe Ryong Hae, vice marshal of the North Korean military and head of its political bureau, left Pyongyang today, the official Korean Central News Agency said. While China’s Foreign Ministry declined to comment on the report, it was cited by the official Xinhua News Agency.
Choe is the highest-ranking official to visit China since Kim succeeded his late father, Kim Jong Il, in December 2011. North Korea depends on China for fuel oil and consumer goods, and trade between the two has dropped since Kim’s regime fired a long-range rocket in December and detonated a nuclear device in February in defiance of international sanctions.
Conclusions
I believe There is a great deal more coordination between the North Koreans and the Chinese than our Media leads us to believe. And this Coordination accelerates in the Teeth of the Pivot to Asia.
|
| read more |
|
Bank of Japan Affirms Easing After Surge in Bond Yields Bloomberg International Trade |
The Bank of Japan affirmed a plan to double the monetary base over two years after a jump in bond yields highlighted risks associated with Prime Minister Shinzo Abe’s campaign to revive the economy.
The central bank will expand the supply of money in the economy by 60 to 70 trillion yen ($683 billion) a year, as pledged in April, the BOJ said in Tokyo today.
“The BOJ wanted to avoid causing any speculation that it may change course on a policy of massive expansion,” said Mari Iwashita, a bond strategist at SMBC Nikko Securities Inc. in Tokyo, commenting on the absence of any reference to rising debt yields. “The focus is on how Kuroda will address this at the press conference.”
Ten-year government debt yields rose to 0.89 percent as of 12:57 p.m. in Tokyo from as low as 0.86 percent before the decision. That compared with a high of 0.92 percent last week.
The yen was little changed at 102.47 per dollar, down 16 percent for the year, a slide that’s bolstered the competitiveness of Japanese exporters while making the cost of imported goods such as energy more expensive. A government report today showed that exports in March posted the first back-to-back gain on an annual basis since May 2012. A jump in imports left Japan with a 10th straight monthly trade deficit.
Yields on benchmark 10-year government securities climbed about 23 basis points in the two weeks through May 17, the biggest such advance since May 2008, according to data compiled by Bloomberg. The central bank, set to buy 70 percent of the debt sold by the government each month, stepped in on May 15 to limit the decline in prices, announcing a 2.8 trillion yen infusion of funds. Price volatility for Japanese government bonds surged 2.6 percentage points this year to 3.65 percent yesterday, the biggest advance among 26 sovereign-debt markets tracked by Bloomberg and the European Federation of Financial Analysts Societies.
Conclusions
The Bank of Japan might get trapped in a Catch-22 where They end up being the only Buyers of Government Debt and not just 70% of All Debt being issued.
|
| read more |
|
South Sudan cuts oil output citing problem with exports to Sudan Reuters Africa |
South Sudan has almost halved its oil production due to a problem with oil exports to Sudan, it said on Tuesday, adding it suspected its rival had closed the cross-border pipeline in a possible sign of new friction between the neighbors.
"There has been a problem with the oil production on the side of Sudan," Mawien Makol Arik, spokesman for South Sudan's foreign ministry, told Reuters in the capital Juba.
He said the charge d'affairs of China, which controls South Sudan's oil industry, had said there was only a technical issue with the cross-border oil flows.
"But we suspect it is political. We suspect that Sudan has shut down the oil pipeline," Arik said, adding that the government had cut the output to 105,000 barrels per day (bpd)from around 200,000 bpd previously.
But a source in Sudan's oil ministry denied the pipeline, which landlocked South uses to export its crude, had been shut.
"This is not true. The oil from South Sudan is being processed for export," the source said, asking not to be named.
Conclusions
South Sudan's oil cutoff: brilliant negotiating, or suicide? By Aly-Khan Satchu January 30, 2012 http://www.csmonitor.com/World/Africa/Africa-Monitor/2012/0130/South-Sudan-s-oil-cutoff-brilliant-negotiating-or-suicide
The current stand off between Sudan and a newly independent South Sudan made me recall an anecdote told by Henry Kissinger, after a series of negotiations with Syrian President Bashar al-Assad's father, the late President Hafez al-Assad.
“Assad never lost his aplomb. He negotiated daringly and tenaciously like a riverboat gambler to make sure that he exacted the last sliver of available concessions. I once told him that I had seen negotiators who deliberately moved themselves to the edge of a precipice to show that they had no further margin of maneuver. I had even known negotiators who put one foot over the edge, in effect threatening their own suicide. He was the only one who would actually jump off the precipice, hoping that on his way down he could break his fall by grabbing a tree he knew to be there. Assad beamed.”
I will leave it to you to calculate who might be Hafez: South Sudan's President Salva Kiir or Sudanese President Omar al-Bashir? Or both?
Further Conclusions
I had inclined to the View in this Interview below that Both Sides had decided that after going 15 Rounds it had become very binary and either Side could land a Lucky Punch and decided to call a Truce. Maybe not.
New Sudan/South Sudan oil deal likely to hold RFI http://www.english.rfi.fr/africa/20130313-sudan-south-sudan-deal-restart-oil-likely-hold
By Michel Arseneault Sudan and South Sudan have signed another deal to restart the flow of oil from south to north. South Sudan last year shut down the pipelines that allow it to export oil via Port Sudan. Analyst Aly-Khan Satchu says this agreement, unlike previous ones, is likely to hold, mainly because Khartoum and Juba no longer approach each other like sparring partners.
Ghana Stock Exchange Composite Index +54.70% 2013 http://www.bloomberg.com/quote/GGSECI:IND
Zimbabwe Stock Exchange Plans IPO as Index Rallies 38% Bloomberg http://www.bloomberg.com/news/2013-05-21/zimbabwe-stock-exchange-plans-ipo-as-index-rallies-38-.html
Zimbabwe’s stock exchange, whose main industrial index has jumped 38 percent this year, plans to sell shares through an initial public offering by the end of 2013, according to the country’s Securities Exchange Commission.
The market value of shares listed on the bourse may nearly double to $10 billion from the current $5.4 billion over the next 12 months as it plans to start automated trading to attract more investors, Chief Executive Officer Tafadzwa Chinamo said in an interview in Lusaka, the capital of neighboring Zambia, where he spoke at a capital markets conference. An IPO might value the ZSE at $15 million to $20 million, he said.
Zimbabwe’s plans come as African bourses record some of the highest growth rates in the world this year. The Ghana Stock Exchange, which began automated trading in 2009, has seen its composite index rally a global-best 47 percent. Nigerian and Kenyan markets are among the top 10 best performers, according to data compiled by Bloomberg.
The ZSE has appointed Imara Holdings Ltd., the Botswana-listed investment bank, and Harare-based Corporate Excellence as financial advisers for its planned share sale, Chinamo said. The move is different from a demutualization, which is commonly done by securities exchanges, because the Zimbabwean government claimed ownership of the bourse since it was established in its current form in 1974, he said.
Along with automation, which will see trading done electronically rather than by hand, holding elections will boost confidence among investors, Chinamo said. The southern African nation is due to hold votes this year, ending a five-year power-sharing agreement between Prime Minister Morgan Tsvangirai’s Movement for Democratic Change party and President Robert Mugabe’s Zimbabwe African National Union-Patriotic Front.
Nigeria Stock Exchange All Share Index +35.25% 2013 http://www.bloomberg.com/quote/NGSEINDX:IND
Nigeria $1 bln wealth fund to start investing in June http://english.ahram.org.eg/NewsContent/3/12/72002/Business/Economy/Nigeria--bln-wealth-fund-to-start-investing-in-Jun.aspx
Nigeria will begin investing the initial $1 billion allocated to a new sovereign wealth fund by June, a statement from the fund showed, after it delayed the start date twice.
Africa's biggest oil producer is one of only three OPEC member states that do not yet have a wealth fund (SWF) set up. Global markets and investors are closely watching Africa's second-biggest economy's plans for its SWF.
Nigeria's Sovereign Investment Authority (NSIA) in a late Monday statement, also said it would allocate 32.5 percent of the fund to infrastructure investment, the same amount for a savings pot for future generations, 20 percent to protect against commodity price shocks, with 15 percent unallocated.
"This formula aims to balance the infrastructure need of the current generation and the need for savings for the future generation of Nigerians," the statement said.
The fund faces opposition from Nigeria's powerful state governors, who want oil savings to be distributed for spending on projects, arguing that it is unconstitutional for the federal government to hoard money that belongs to all three tiers of government - federal, state and local.
Because of this, it started with a mere $1 billion, whereas the Excess Crude Account (ECA) it is supposed to replace had nine times that amount in it late last year. That has fallen to $5.87 billion so far this year, as the government has made withdrawals to appease state governors.
Dollar versus Rand 1 Year Chart INO 9.5227 Last http://quotes.ino.com/charting/index.html?s=FOREX_USDZAR&v=d12&t=c&a=50&w=1
South Africa All Share Year To Date +8.01% 2013 http://www.bloomberg.com/quote/JALSH:IND
Egypt Pound versus The Dollar 1 Year Chart INO http://quotes.ino.com/charting/index.html?s=FOREX_USDEGP&t=c&a=50&w=1&v=d12
Egypt’s Dollar Black Market Premium Falls Amid Pound Decline Bloomberg http://www.bloomberg.com/news/2013-05-21/egypt-s-dollar-black-market-premium-falls-amid-pound-decline.html
The premium dealers demand for dollars in Egypt’s unofficial currency market is falling as the pound goes through what JPMorgan Asset Management called “non-chaotic maximum devaluation.”
The U.S. currency is selling for 7.47 Egyptian pounds in the Arab country’s so-called black market, a 7 percent premium to the official price, according to the average of three quotes from money exchangers compiled by Bloomberg. That’s down from a premium of 7.9 percent in an April 15 survey and 15 percent on April 2. The dealers, who run currency exchange businesses in Cairo, asked not to be identified because the trade is illegal.
The pound is experiencing “non-chaotic maximum devaluation, but still looks like it’s somewhat expensive to fair value,” George Iwanicki, emerging market macro strategist at JP Morgan Asset Management, said in an e-mailed report today. “The issue in Egypt is political uncertainty, which has led to capital outflows and a very sharp ‘burn’ in the foreign exchange reserves base that the central bank enjoys.”
“The spread is closing after the pound was allowed to weaken faster over the last month and as FX bureaus became more careful because of increased central bank scrutiny,” Mona Mansour, chief economist at Cairo-based CI Capital, said by phone. “But we don’t expect further narrowing of the spread until there’s a solid government reform plan that leads to an IMF agreement.”
The yield on the government’s $1 billion of 5.75 percent bonds due in April 2020 advanced for a fourth day, rising two basis points, or 0.02 percentage point, to 7.55 percent. That’s the highest level on a closing basis in more than six weeks.
Conclusions
Thats a Positive Development but it has probably run its Course.
Egypt ^EGX30 Bloomberg +1.26% 2013 http://www.bloomberg.com/quote/CASE:IND
AU 'not opposed' to the acquisition of African farmland by foreign investors http://www.afriquejet.com/news/6863-acquisition-of-african-farmland-by-foreign-investors.html
At least 2.5 million hectares have been acquired by the foreign investors in Ethiopia, Ghana, Madagascar, Mali and Sudan.
|
| read more |
|
EABL share price data here +54.399% 2013 Record High [for the 12th Consecutive Session] Kenyan Economy |
Par Value: 2/- Closing Price: 409.00 Total Shares Issued: 790774976.00 Market Capitalization: 323,426,965,184 EPS: 13.46 PE: 30.386
It was a Pleasure spending Time with Nick Blazquez President | Africa, Turkey, Russia & E.Europe | DIAGEO yesterday. We always cover so much ground and this time was no exception. Nick spoke about his Bucket List and how he had completed his first Marathon this Year. And we even touched on Cosmology and most of the World as we find it. Thanks Nick.
Here’s a note I sent the day after I completed the marathon to those who helped me in the months upto the big day. As I read it now I was clearly feeling somewhat poetic due no doubt to the emotional of having ticked something off my bucket list and the spectacular day that it was!
“…………. "Born to Run” is a really interesting book in which the author tells a captivating story of elite ultra-marathoners and asserts that humans are distance running machines and much more so than other animals. He goes on to say that running in groups gives us energy from each other and sustains us through team work.
I can attest to that. I've just completed the London Marathon and ran with about 40000 others. Before the start, the nervous energy, excitement and apprehension of the runners were palpable. This was then replaced by a 30 second silence in memory and support of Boston and the tragic events that happened at the Marathon there only 6 days previously.
It was a beautiful sunny day, initially somewhat cool then warming up. Hundreds of thousands of spectators lined the course; brass bands playing, music blaring, little children holding their hands out to runners who tapped them as they went by. If you had your name on your shirt, like I did, energy poured into each runner as they heard their names called out with encouragement to “catch those Kenyans” or “follow the crowd”. Running round Cutty Sark and up and over Tower Bridge were a couple of many beautiful views I took in. By mile 19 however, I wasn’t paying much attention to the views as I had to dig deep to keep going.
The number of charities represented, literally carried on peoples backs, sweat and tears was amazing. It was inspirational to see runners with pictures of loved ones on their backs, running and raising money for their chosen cause. Thousands and thousands of individual stories, millions and millions of pounds raised for charities.
Completing the Marathon was like reaching the summit of a mountain. All the hard work had been done in the training before. Carving out time in the diary and sticking to it. The Water of Life Half Marathon scheduled at the end of March was part of my training plan and whilst it was postponed (to a date I can’t make) because the course was water logged, I ran the 13.1 miles on the day in commitment to those that sponsored me.
I ran all the places I had travelled to over the preceding weeks; Moscow, Lagos, New York and Nairobi and many others. Running through ankle niggles and blisters, through rain and sleet and 30 degrees C. At the end of each week I highlighted in green on my training plan when I did well, and red when I didn’t – just like I do in work as I track my performance!! Often times, on coming home from a trip, I would say to Alison, “hi there, I’m just out for a run”. I couldn’t have done it without her.
The encouragement I got from so many people was just amazing. I am so appreciative of the support and sponsorship I received. I raised £2k for Water Aid (Half Marathon) for a project in Ethiopia and for the £3k for the UK Childrens Society (Marathon) and I ran the marathon in 3hr 32mins, thereby achieving all my targets. I am a very fortunate person.
Now,…….. notwithstanding my opening comments about being born to run, I’m not sure I’ll be running a marathon again anytime soon!
…….”
Nick
Nick also reconnected me to Seni in a Blink which was very nice.
|
| read more |
|
Seni Adetu at #Mindspeak #EABL #Tusker Lite @InterConNairobi #Africa 2.0 Diageo Kenyan Economy |
Do Watch Seni Adetu at #Mindspeak RICH TV http://www.rich.co.ke/rctools/richtv.php?d=MjAxMS0xMi0zMQ%3D%3D
Kenya’s wealth profile through the eyes of a banker http://www.nation.co.ke/Features/smartcompany/Kenyas-wealth-profile-through-the-eyes-of-a-banker/-/1226/1857292/-/4u80hz/-/index.html
In an industry where profit is king, forking out Sh40 million to build a branch must be informed by a detailed analysis and good case for investment.
“When making a business case to enter a particular market, the bank management would need to weigh the economic potential of the area and rate at which the set-up costs will be recovered,” says the Kenya Bankers Association (KBA).
Looking at the branch network against the government data on wealth distribution, a close correlation emerges, meaning that the bankers could be right.
From the perspective of a banker, the county of Elgeyo Marakwet ranks the poorest of the 47 counties, featuring a lone branch. This is interesting, considering that the county is home to the largest athletic camp — Iten — and 70 per cent of Kenya’s big athletes. The branch network data are contained in the Annual Bank Supervision Report released by the Central Bank last week. According to the Kenya National Bureau of Standards’ poverty incidence survey, over half of the population in Elgeyo Marakwet, 56 per cent, is classified as poor. Mandera, Samburu, and West Pokot each have two branches, closely mirroring the areas classified as marginalised. In Mandera, 88 per cent of the population is regarded as needy. Samburu is at 73 per cent and West Pokot at 70 per cent.
Nairobi, where 51 per cent of the country’s economic activities are housed, is home to 514 branches or 40.7 per cent of the country’s total branch network. Of the 514 branches in Nairobi, 53 were opened last year. Mombasa comes in second with 108 outlets, while Kiambu, Nakuru, Meru, and Uasin Gishu take the top five slots at 59, 57, 38, and 38 respectively.
“This likely reflects the different levels of per capita income as well as the geographic distribution of population,” a survey commissioned by the Financial Sector Deepening for Central Bank in 2010 highlighted. The study looked at factors and policy consideration by banks in setting up branches or opting for alternative channels to serve their customers. The report informed the Central Bank decision to permit agency banking.
Security is also key — the main reason which may explain why banks have kept away from Elgeyo Marakwet despite its fame and fortunes. The setting up of county governments is, however, likely to change this outlook.
With each county expected to handle not less than Sh2 billion annually, the attraction to get a piece of the cake may see increased outlets in the areas now classified as marginalised.
However, according to KBA, the question of whether or not banks need a physical presence in order to provide banking services across the counties needs to be raised. The other question is whether the banker, like other important institutions in Kenya, stands accused of practising marginalisation.
In 2006, only 18.5 per cent of the bankable population had access to accounts. Three years later, the overall financial inclusion had increased to 67.3 per cent and the number is now over 70 per cent. This has come about as a result of change in delivery channels; apart from the traditional brick and mortar branch rollout, more innovative and friendly systems have come into play.
Much of the gains have come from the introduction of mobile money and the responding rollout of branchless agency banking models by commercial institutions competing for the mass market. Kenyan regulators have also been instrumental in introducing appropriate regulations to facilitate low-income banking and strengthening saccos and microfinance institutions.
Money transfer services have had the biggest impact, with Safaricom’s M-Pesa signing up almost 75 per cent of the adult population.
The uptake is mainly because banking institutions have integrated their platforms with mobile money transfer services such as M-Pesa, Airtel Money, Yucash, and Orange Money, which has enable their clients to access their accounts via their phones.
The impact of mobile money transfer is seen by the fact that, 17 commercial banks had signed for the services in 2012 and Sh1.5 trillion was transacted through the systems. But a large number of Kenyans still prefer informal financial groups due to efficiency in processing loans and low stigma associated with formal institutions.
As at December 2012, 10 commercial banks had contracted 16,333 active agents, facilitating over 38 million transactions valued at Sh195.8 billion with about 12.7 per cent of the money transacted using the mobile platform. However, studies are pushing for more aggressive deployment of agency banking, with a report prepared by the University of Nairobi saying that all commercial banks operating retail banking should be made to adopt the model.
“The study, therefore, recommends that agency banking as a means of enhancing financial inclusion be highly supported and encouraged by all players — banks, government, and licensing bodies, especially local authorities — so as to reduce the high compliance costs in registration bureaucracy,” the report says.
However, big banks still prefer to hang on to the big client, which explains why in 2012 most of the 111 new branches (65 per cent) were set up in Nairobi, Mombasa, and Kiambu counties.
In its 2012 annual supervision report, the Central Bank says it expects financial institutions “to introduce technologically-driven banking products that are expected to re-engineer the processes of providing banking services in Kenya.
Conclusions
There has been a revolutionary Wind blowing through the Kenyan Banking Sector.
Safaricom share price data and FY Earnings here +40.594% 2013 http://www.rich.co.ke/rcdata/company.php?i=NTU%3D
Par Value: 0.05/- Closing Price: 7.10 Total Shares Issued: 40000000000.00 Market Capitalization: 284,000,000,000 EPS: 0.44 PE: 16.136
FY 2013 Earnings through 31st March 2013 versus FY through March 2012 FY Revenue 124.287856b versus 106.995529b +16.2% FY Gross Profit 67.743420b versus 52.856310b +28.2% FY Operating Expenses [40.643226b] versus [32.704953b] +24.3% FY PBT 25.450565b versus 17.369400b +46.5% FY PAT 17.539810b versus 12.627607b +38.9% FY EPS 0.44 versus 0.32 +37.5% FY Dividend 0.31 cents a share +40.9% Cash and Cash Equivalents at End of Period
M-Pesa Registered Customers grew by 14.8% to 17.11m as at end March 2013 M-Pesa Revenue +29.5% to 21.84b M-Pesa/SMS/Data Revenue increased to 32.5% of Total Revenues from 29.2% FY 2013 M-Pesa Revenue now 18.5% versus 16.8% previously of Total Revenue 1.2m Customers using M-Shwari
FY 2012/2013 Interview with @BobCollymore CEO #Safaricom RICH #TV http://www.rich.co.ke/rctools/richtvi.php
Safaricom FY2011/2012 Annual Results @BobCollymore Interview with @alykhansatchu YouTube http://j.mp/KO6zLG
Praise for the Governor Njuguna M-Pesa The Jewel in the Crown The Intersection Point between Mobile Operators and Banks The Three IPADs I bought for my daughters H2 Best Earnings Per Share Half since Listing.
Kenya Shilling versus The Dollar Live ForexPros http://j.mp/5jDOot
Nairobi All Share Bloomberg +34.735% 2013 Record High http://www.BLOOMBERG.COM/quote/NSEASI:IND
Nairobi ^NSE20 Bloomberg +20.445% 2013 http://j.mp/ajuMHJ
I&M Bank set to debut at the stock market on June 25 Business Daily http://www.businessdailyafrica.com/I-M-Bank-set-to-debut-at-the-stock-market-on-June-25/-/539552/1858992/-/m94v91/-/index.html
I&M Bank is set to list at the stock market on June 25, completing a reverse take-over that will merge businesses of the lender and investment firm City Trust.
The new entity, I&M Holdings, will start trading at Sh448 per share, the last average market price of City Trust before suspension from the Nairobi Securities Exchange (NSE).
Both City Trust and I&M Bank will operate as separate entities under one group after the merger, with the banking arm becoming the biggest business of the group unlike previously when City Trust, owned just 7.28 per cent of the lender. I&M Bank shareholders will hold 92.7 per cent shares of the new entity.
“The bank will remain the operational hub of the group,” I&M told the Business Daily.
City Trust had a market capitalisation of Sh2.6 billion at the time of suspension of its shares from trading, while I&M Bank, whose shares were not listed, had a total shareholders’ equity of Sh14.6 billion.
I&M Bank’s asset size of Sh144 billion as at the end of 2012, makes it potentially the sixth largest listed lender when compared with peers KCB (Sh367 billion), Equity (Sh243 billion), Co-operative Bank (Sh200.8 billion), Standard Chartered (Sh195 billion) and Barclays (Sh184 billion).
Every Listed Share can be interrogated here http://www.rich.co.ke/rcdata/nsestocks.php
Delameres divide Sh5bn estate in succession plan Business Daily http://www.businessdailyafrica.com/Delameres-divide-Sh5bn-estate-in-succession-plan/-/539552/1859144/-/knpbw4z/-/index.html
The Delameres have registered a new company, Ngombe Limited, to inherit some 1,680 steers and 792 cows in his stable and a separate entity to hold its real estate property.
Each steer is estimated to cost Sh65,000 while a cow is priced at Sh140,000, meaning the company is starting with an asset base of about Sh215 million.
The Delameres have also registered Land Limited to hold its real estate property among them the over 50,000 acres Soysambu Ranch in Naivasha, which is estimated to be worth more than Sh5 billion.
News of the succession plan came from documents the family has filed with the monopolies commission and a subsequent notice in the Kenya Gazette authorising the transaction.
“The Competition Authority authorises the acquisition of 1,680 heads of steers and 792 heads of cows from Delamere Estates Limited by Ngombe Limited,” reads a statement from the authority.
Conclusions
We had a lovely Lunch at Tom's with his Family and @Aidanhartley and his that time we stayed at Lake Elmenteita @SerenaHotels
Lake Elmenteita @SerenaHotels #Kenya http://www.twitpic.com/chl3gk
Riding along the Shore Lake Elmentaita @SerenaHotels http://www.twitpic.com/chc1u0
|
| read more |
|
|
|
|