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Satchu's Rich Wrap-Up
Thursday 09th of March 2017

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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

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12-SEP-2016 :: Mirrors on the ceiling, The pink champagne on ice @TheStarKenya

A lot of risk calculations are based on Value at Risk (VAR).
Essentially, you overlay a volatility measure over the portfolio, and
you calculate how much money is on the line. Central banks have
suppressed volatility therefore in real terms; investors
are now holding bigger positions at these current artificially
suppressed levels. If volatility spikes, positions are going to be
reduced en masse. Or to put it another way and to borrow the lyrics
from the Eagles Hotel California:
Mirrors on the ceiling,
The pink champagne on ice
And she said “We are all just prisoners here, of our own device” Last
thing I remember, I was
Running for the door
I had to find the passage back
To the place I was before
“Relax,” said the night man,
“We are programmed to receive.
You can check-out any time you like,
But you can never leave! “

What is clear is that we are at the fag-end of this party.

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Shoot for the Moon Nairobi

 “It may be necessary to climb back into the heat of the moment.” —August Wilson

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Tsavo. Photo by @PinkeFeder

Finally I would like to quote the words of Sir Crispin Tickell whose
credentials would be as long as this lecture - for example:

.. "as long as Nature is seen as something outside ourselves;
frontiered and foreign, separate, it is lost both to us and in us. It
follows that to achieve a society in harmony with Nature, we must be
guided by respect for it. We should direct and integrate our lives
consistently with it rather than try to subjugate and control it. This
requires deeper understanding and acceptance of Natural processes, and
an ability to cope with their inherent uncertainties. Thus in the area
of conservation, we should move from the static idea of conservation
of places and things to the conservation of process, to allow natural
processes to function, and to create conditions in which they can do

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The United States on Wednesday said "all options are on the table" to deal with North Korea
Law & Politics

The United States on Wednesday said "all options are on the table" to
deal with North Korea and dismissed China's suggestion of a "dual
suspension" of U.S. and South Korea military drills and Pyongyang's
missile and nuclear tests.

"We are not dealing with a rational person," U.S. Ambassador to the
United Nations Nikki Haley said of North Korean leader Kim Jong Un
after the United Nations Security Council discussed North Korea's
launch of four ballistic missiles on Monday.

"It is an unbelievable, irresponsible arrogance that we are seeing
coming out of Kim Jong Un at this time," Haley said.

She said the administration of U.S. President Donald Trump was
reevaluating how it would handle North Korea and that "all options
were on the table," adding: "We are making those decisions now and we
will act accordingly."


Can Kim be put back in his box? don't think so.

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Syria's Civil War Is Almost Over ... And Assad Has Won by PATRICK COCKBURN
Law & Politics

Otherwise, Turkey and the two other big supporters of the Syrian armed
opposition, Saudi Arabia and Qatar, are seeing their influence over
events in Syria swiftly diminish. Iran and Hezbollah of Lebanon, who
were the main foreign support of President Bashar al-Assad before
2015, do not have quite same leverage in Damascus since Russian
military intervention in that year.

American and British ambitions to see Mr Assad removed from power have
been effectively abandoned and the Syrian government shows every sign
of wanting to retake all of Syria. If Isis loses Mosul and Raqqa in
the next few months there will be little left of the Caliphate
declared in June 2014 as a territorial entity.

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Five Questions About the Latest @WikiLeaks @tnyCloseRead
Law & Politics

.” In other words, WikiLeaks has the files because the C.I.A. had
“lost control of the majority of its hacking arsenal including
malware, viruses, trojans, weaponized ‘zero day’ exploits, malware
remote control systems and associated documentation.” (WikiLeaks seems
to have redacted some of the sensitive code.)

1. How many ways might the C.I.A. be watching? The files discuss the
use of basic consumer products for surveillance. One of the more
striking details involves your Samsung SmartTV listening in on you,
perhaps in collaboration with the camera or the microphone in your
iPhone—even when the television is turned off. A television could also
potentially yield information about what news programs or
non-English-language programs people watch—possible indicators of
their political leanings, religious beliefs, or associations. These
are not new scenarios for privacy advocates; some of the lawyers and
journalists working on these matters put their phones in the
refrigerator when having a sensitive conversation. But the files
suggest that the C.I.A. has gone from the concept stage to the actual
building of a box of tools that can be used to break into consumer
electronics. (The tool for taking over a Samsung SmartTV is called the
Weeping Angel, which raises another question: how much time do C.I.A.
contractors spend watching “Doctor Who”?) It also looks as if the
C.I.A. may have a way to get around the encryption features of
messaging systems. And there is talk of “Potential Mission Areas,”
such as the control systems of cars. (It is not clear, from the files,
how much of all this has been put into effect, or whether it works in

2. The files indicate that the U.S. government knows about—and is
happy to make use of, and leave uncorrected—vulnerabilities that could
also allow bad actors a way into American homes, or, for that matter,
American intelligence agencies. On that point:

3. Are Americans the targets? This is going to be a key issue, both
politically and legally. If the C.I.A. is developing these tools, and
perhaps promulgating them to other intelligence agencies, is it also
taking part in domestic spying? How is the line between domestic and
foreign defined these days? The Guardian notes that one of the files
related to the Samsung sets contains a reference to a “joint workshop
with MI5/BTSS (British Security Service),” and that others refer to
hackers working out of American diplomatic facilities in Germany.

4. What will the courts make of this? This is not only an American
concern; courts in Europe may have something to say, too, given the
strict privacy laws in many countries.

5. What about Donald Trump? Last week, he was complaining that
President Obama, or someone, had tapped or bugged or otherwise failed
to observe the sanctity of Trump Tower. Does Trump have any Samsung
SmartTVs? As my colleague Steve Coll writes, there is a scenario in
which Trump might be given pause about surveillance methods that might
be directed at him and his associates. Or he might just rail against
traitors in public and then ask, behind closed doors, when he gets to
use these tools and toys himself. When the news of the revelations
broke, some commentators asked if having promoted WikiLeaks’ Hillary
Clinton-related revelations at his campaign rallies put Trump in an
awkward position. But hypocrisy does not appear to be much of a
constraint on this Administration. Nor are concerns about the laws
circumscribing intelligence activities: Trump is a man who has
complained that the C.I.A. isn’t allowed to torture people. The power
of the President and his spies isn’t something that Trump seems to be
interested in limiting—that is, as long as the President is named


What did People think the @cia was doing - snaffling ice-cream.

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Vladimir Putin praises women for their 'beauty' and for 'always being on time' on International Women's Day
Law & Politics

Vladimir Putin has marked International Women’s Day by praising
Russia's female population for their “beauty”, “tenderness” and for
“always being on time”.

International Markets

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Currency Markets at a Glance WSJ
World Currencies

Euro 1.0545
Dollar Index 102.12
Japan Yen 114.43
Swiss Franc 1.0154
Pound 1.2166
Aussie 0.7525
India Rupee 66.745
South Korea Won 1156.69
Brazil Real 3.1631
Egypt Pound 17.6545
South Africa Rand 13.1519

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Gold Chart INO 1205.18 [below 1,200.00]

oil prices dived 5 percent on Wednesday to the lowest this year as
U.S. crude inventories ballooned to a record.

The market did pare a little of the losses on Thursday with U.S. crude
up 30 cents at $50.58, while Brent crude bounced 43 cents to $53.54 a

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07-MAR-2017 :: I am also of the view that the Shale Boys in North America have OPEC over a Barrel

I am also of the view that the Shale Boys in North America have OPEC
over a Barrel.

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Congo risks 50 percent drop in power output due to low rainfall

Water levels in the Congo - Africa's second longest river, normally
its deepest and a vital artery across the center of the continent -
have fallen 50 percent compared to last year, said Medard Kitakani,
spokesman for national utility SNEL.

That meant levels for the November-February period were at their
lowest in more than 100 years, he told Reuters.

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Famine Is Final Straw as War-Weary South Sudanese Flood Capital

Since South Sudan’s war erupted, Mary Nyal’s husband has vanished and
she narrowly escaped being raped by armed men. But it was looming
famine that finally forced her to flee her home county and live
hand-to-mouth in the capital.

“I had no way of getting food to eat,” the 33-year-old mother of three
said as she clutched her baby to her chest and asked passers-by for
change in a market in central Juba. “The last time I reached my field
to harvest was in 2015.”

Nyal’s home area of Mayendit county in Unity state, about 400
kilometers (249 miles) north of Juba, was one of two South Sudanese
areas where the United Nations last month made the world’s first
official declaration of famine since 2011. The African nation’s
three-year civil war has already claimed tens of thousands of lives.
Now 100,000 people in Unity are starving and 5.5 million, about half
the country’s population, may face food shortages by July.

The UN is among the groups who have called it a man-made crisis,
caused by the conflict, in which both government forces and rebels
have committed atrocities, and a collapsing economy. The government
says thousands of people have arrived in Juba -- a city of about
400,000 -- since the final few months of last year, propelled by
insecurity, hunger and the difficulties of living in UN protection


Leadership in South Sudan is simply unqualified and unable. They need
to be removed.

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Salva Kiir Mayardit (born 13 September 1951) has been President of South Sudan since its independence in 2011

Salva Kiir Mayardit (born 13 September 1951) is a Dinka South Sudanese
politician who has been President of South Sudan since its
independence in 2011

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'We want bread': subsidy cut sparks protests across Egypt

Some of Egypt’s major cities have been paralysed by rare protests in
response to a cut in bread subsidies.

The country’s ministry of supply reduced the state-sponsored provision
of bread of up to 4,000 to 500 loaves per bakery, according to local
news reports.

The move is designed to replace an earlier and more controversial
proposal to cut the supply from five loaves per person per day to

But while the cuts are unlikely to have a dramatic affect on the bread
rations of the average citizen, the suggestion struck a nerve among
the Egyptian public. In response to the decision, hundreds of Egypt’s
poorest citizens filled the streets in the cities of Alexandria and
Giza, and the towns of Kafr el-Sheikh and Minya. Roads were blocked
and residents surrounded government buildings.

One protest in Alexandria showed people chanting “we want bread” and
“everything but a loaf”, according to video footage taken by
protesters. The hashtag “supply uprising” trended on Twitter across
Egypt on Tuesday.

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@KCBGroup reports FY 16 PBT +9.622% Earnings here

Par Value:                  1/-
Closing Price:           27.00
Total Shares Issued:          3,066,056,647
Market Capitalization:
EPS:             6.46
PE:                 4.179

KCB Group PLC FY 2016 Results through 31st December 2016 vs. 31st December 2015

Kenya Government securities 58.466646b vs. 33.827214b +72.839%
Loans and advances to customers (net) 385.745331b vs. 345.968686b +11.497%
Total Assets 595.239643b vs. 558.094154b +6.656%
Customer deposits 448.173797b vs. 424.390833b +5.604%
Total shareholders’ funds 96.565774b vs. 81.253607b +18.845%
FY Loans and advances to customers interest income 51.208848b vs.
46.191995b +10.861%
FY Government securities interest income 10.866513b vs. 9.117249b +19.186%
FY Total interest income 62.806075b vs. 56.383933b +11.390%
FY Customer deposits expense [14.481365b] vs. [15.295887b] -5.325%
FY Total interest expenses [15.779430b] vs. [17.147978b] -7.981%
FY Net interest income/ [loss] 47.026645b vs. 39.235954b +19.856%
FY Fees and commissions on loans and advances income 6.560093b vs.
5.366204b +22.248%
FY Foreign exchange trading income 5.493696b vs. 4.067466b +35.064%
FY Other income 4.331744b vs. 5.151946b -19.920%
FY Total other operating income 22.450006b vs. 23.380514b -3.980%
FY Total operating income 69.476650b vs. 62.616468b +10.956%
FY Loan loss provision [3.823759b] vs. [4.713807b] -18.882%
FY Staff costs [17.719037b] vs. [15.310898b] +15.728%
FY Other operating expenses [14.978945b] vs. [11.738084b] +27.610%
FY Total operating expenses [40.385525b] vs. [36.078896b] +11.937%
FY Profit/ [loss] before tax and exceptional items 29.091125 vs.
26.537573b +9.622%
FY Profit/ [loss] after tax and exceptional items 19.722447b vs.
19.623071b +0.506%
FY Gains/ [losses] from translating the financial statements of
foreign operations [6.154131b] vs. 317.968m
EPS (Diluted and basic) 6.46 vs. 6.49 -0.462%
Dividend per share 3.00 vs. 2.00 +50.00%
Net NPL and Advances 10.742891b vs. 8.874656b +21.051%
Liquidity ratio 37.5% vs. 48.3% -10.800%
No. Of Shares Outstanding : 3,066,056,647

A selection of @KCBGroup Tweets from the FY 16 Earnings release

KCB Group's Profit Before Tax for year ended December 31st 2016 was up
by 10% to KShs. 29.1B. from KShs. 26.5B #KCB2016FYResults

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A brief summary of the key financial ratios for KCB Bank Kenya and KCB Group #KCB2016FYResults

"Customer deposits increased 6% from KShs. 424.4B to KShs.448.2B with
65% being demand deposits"
Total Assets improved by 7% from Sh 558B to Sh595.2B While Net Loans &
Advances were up 11% from Sh346B to Sh385.7B
Currently, non-branch channel systems—Mbenki, KCB M-PESA, Mobi and
payments— account for 77% of total KCB transactions
KCB has acquired over 10M customers on its mobile platform either
directly or through partnerships over the past 5 years

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"90% of KCB Bank loans are processed on Mobile, with 53% of customer interactions being on mobile" @JoshuaOigara #KCB2016FYResults

A closer look on the impact of the Interest Rate Cap for KCB Bank-
Loans & advances and customer deposits increased #KCB2016FYResults


These were strong results especially when you consider that
[6.154131b] was taken re [losses] from translating the financial
statements of foreign operations - South Sudan
A 3 shilling Final dividend is worth 11.11% on yesterdays closing price.
its a Darwinian Banking sector and KCB is one of the fittest

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NIC Bank reports FY 16 EPS -3.286% Earnings here

Par Value:                  5/-
Closing Price:           24.50
Total Shares Issued:          639945603.00
Market Capitalization:        15,678,667,274
EPS:             6.77
PE:                 3.618

Well established Kenyan commercial bank.

NIC Bank FY 2016 Results through 31st December 2016 vs. 31st December 2015
Kenya Government securities 23.795496b vs. 19.703042b +20.771%
Loans and advances to customers (net) 114.466274b vs. 116.009302b -1.330%
Total Assets 169.58985b vs. 165.788268b +2.214%
Customer deposits 111.824685b vs. 112.364637b -0.481%
Total Equity 30.345364b vs. 26.346142b +15.180%
FY Loans and advances interest income 15.150632b vs. 13.958009b +8.544%
FY Total Interest income 19.020675b vs. 17.014132b +11.793%
FY Customer deposit expense [5.368231b] vs. [5.836231b] -8.019%
FY Total interest expense [6.852078b] vs. [7.271599b] -5.769%
FY Net interest income 12.168597b vs. 9.742533b +24.902%
FY Foreign exchange trading income 1.105147b vs. 1.431231b -22.783%
FY Total non-interest income 4.019559b vs. 4.032160b -0.313%
FY Total operating income 16.188156b vs. 13.774693b +17.521%
FY Loan loss provision [3.749530b] vs. [1.652475b] +126.904%
FY Staff costs [3.222493b] vs. [2.816867b] +14.400%
FY Total operating expenses [10.021207b] vs. [7.377418b] +35.836%
FY Profit before tax and exceptional items 6.166949b vs. 6.397275b -3.600%
FY Profit after tax and exceptional items 4.330396b vs. 4.485125b -3.450%
EPS (Basic & diluted) 6.77 vs. 7.00 -3.286%
FY Total dividend 1.25/share vs. 1.25/share
Net NPL and advances 7.861743b vs. 10.451907b -24.782%
Liquidity ratio 38.74% vs. 29.22% +9.520%
Excluding provisions, pre-tax earnings were actually up 23% y/y
largely supported by NIMs expansion (+120bps y/y to 7.3%)
Yield on interest earnings assets rose (+90bps y/y, -40bps q/q) as
cost of funds declined (-30bps y/y to 5.2%, -10bps q/q)
Loan book contracted 1% y/y (+4% q/q) to KES 114.4bn as customer
deposits flat-lined y/y at KES 111.8bn (+3% q/q)
Non-funded income remained flat as forex income decreased 23% y/y
OpEx inflated 10% y/y mainly on account of staff costs (+14% y/y),
cost to income ratio improved by 280bps to 38.7% due to faster income
growth (+18% y/y)
Loan loss provisioning increased 127% y/y, raising the coverage ratio
to 42.1% from 27.2% the comparative year and edging the cost of risk
170bps higher y/y to 1.7%
NPL ratio therefore reduced to 10.6%(-40bps y/y, -80bps q/q) as GNPLs
declined 113% y/y


Its a cheap share, well managed and for those looking at a Tier 2
position NIC is probably the one.

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Kenya's proposed Sh43 billion purchase of a dozen armed border-patrol aircraft "fails the smell test," says John Githongo.

Kenya's proposed Sh43 billion purchase of a dozen armed border-patrol
aircraft and related items from a US manufacturer “fails the smell
test,” says anti-corruption campaigner John Githongo.

Mr Githongo suggests that the pending deal with New York-based L3
Technologies could involve corruption on the part of Kenyan officials.

He notes that a different US company has indicated it could supply
Kenya with the missile-bearing and intelligence-gathering planes for
about Sh13 billion less than the price L3 is said to be charging.

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Kenya Shilling versus The Dollar Live ForexPros 102.60

Nairobi All Share Bloomberg -10.29% 2017 [July 2013 Lows]

119.62 -1.34  -1.11%

Nairobi ^NSE20 Bloomberg -7.48% 2017

2,947.93 -15.63 -0.53%

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N.S.E Today

The Dollar is strenghtening across the Board as Investors anticipate a
US rate hike this month [100% probability] and a more aggressively
minded Federal Reserve.
Interestingly, The Kenya Shilling was last trading at 102.495, a more
than 2 month high.
Crude oil crashed over 5% wednesday and is on the down move again
today as markets realise OPEC is a House of Cards and the The Shale
Boys in the US have OPEC over a barrel.
Shale is adding Supply quicker than OPEC can cut it.
WTI Crude Oil in New York is below $50.00 a barrel and at 2017 Low.
The big difference between today 2017 [We have our noses pressed
against an Election, We are dealing with drought conditions which has
spiked Food Prices] and 2011 is the benign price profile of Crude
Oil.It is at around 1/2 of the price it averaged in 2011.
The Nairobi All Share snapped a losing streak which had seen the All
Share fall to a May 2013 Low yesterday and firmed +0.23 points to
close at 119.85
The Nairobi NSE20 Index firmed +3.22 points to close at 2851.15.
Equity turnover topped 1b to clock 1.019b with most of the business
transacted in Safaricom.

N.S.E Equities - Commercial & Services

Safaricom where the Regulator effected a Put Option and where the
share price had retreated -15.4% in 2017 and through this mornings
open, closed -1.23% at a Fresh 1 Year Low of 16.00. However, today we
saw the base at 16.00 as Safaricom was trading at session highs of
16.65 +2.78% at the Finish Line. In the old days, todays price action
would be called a ''blow-off bottom'' Safaricom saw high octane
volumes with 44.080m shares worth 705.44m. When you take on Safaricom
[and i feel the Regulator has been arbitrary and capricious] then You
should appreciate that all the World's Top Investors are taking a good
look because in most cases they are invested.

N.S.E Equities - Finance & Investment

Kenya Commercial Bank Group reported FY 16 Earnings ahead of the
Opening Bell at the Nairobi Securities Exchange. KCB reported a
+9.622% FY Profit before Tax acceleration and a +0.506% gain in FY
PAT. The Dividend was hiked a mouth-watering 50% to 3 shillings a
share which is one heck of a coupon to be clipping and underpinned
todays price action.  "Customer deposits increased 6% to KShs.448.2B,
Total Assets expanded by 7% to Sh595.2B While Net Loans & Advances
were up 11% to Sh385.7B.  KCB has acquired over 10M customers on its
mobile platform either directly or through partnerships over the past
5 years which confirms that KCB has already stepped boldly into a new
digital Future. The International Business contribution dropped to
below 5% as South Sudan was written down. KCB reported that FY Gains/
[losses] from translating the financial statements of foreign
operations [6.154131b] vs. 317.968m the previous year.
Counter-intuitively this was a kind of muscle-flexing because only a
very strong bank can take that kind of impairment and not even blink.
These were strong results and given its a a Darwinian Banking sector
then KCB has effectively messaged its shareholders that it is in fact
one of the fittest in this Darwinian world. KCB rallied an eye-popping
+5.56% to close at 28.50 a 9 week high. KCB traded 2.674m shares worth
76.762m. KCB will close positive for the year tomorrow plus Investors
will be bagging a very juicy dividend.

Barclays Bank firmed +0.56% to close at 9.00 to close at a 2017 High.
I&M bank was high-ticked +10% to close at 88.00 on just 100 shares.

NIC reported a -3.286% slide in FY 16 Earnings Per Share and grew its
Total Assets +2.214% to close the Year at 169.589b. According to
Kestrel Research ''Excluding provisions, pre-tax earnings were
actually up 23% y/y largely supported by NIMs expansion (+120bps y/y
to 7.3%).'' For those looking for more beta in their Bank investments,
I would have thought NIC will provide that.Its well-managed and has
the nous to navigate what remain turbulent banking waters. NIC Bank
eased back -1.02% to close at 24.25 and traded just 10,300 shares.

N.S.E Equities - Industrial & Allied

Bamburi Cement was upticked +4.29% to close at 146.00 on just 700
shares. Bamburi Cement remains -8.75% through 2017.

BAT rallied +5.02% to close at 899.00. BAT is -1.1% in 2017.


by Aly Khan Satchu (www.rich.co.ke)
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March 2017

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