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bankelele

• January 15, 2009
• 8:48

  Missing the Centum party

   » ‎ bankelele

  Tags:  Corporate governance  

  (EDIT: Centum's official Press release about the AGM)
  
  When I last looked at Centum, company was in the news due to CEO exit and a postponed AGM and postponed dividend.
  
  Now it appears the AGM took place yesterday: I did not attend as I (i) had sold my shares (ii) did not see invitation document before today (iii) forgot all about Centum AGM
  
  From today's reading, Centum sent out an annual report with updated sections but still the financial accounts for nine months to March 2008: it now includes mentions of departures of Isaac Awuondo (September 08), and CEO Peter Mwangi (October 2008) which coincided with the postponed AGM, and also welcomes on board new directors - Kibuga Karithi (September 08) , Imtiaz khan (November 2008 - Cassias capital partners) and new CEO James Mworia (appointed October 2008, joined board December 2008) who came on board a week after Mwangi left - for greener pastures where he’s now the CEO of the Nairobi Stock Exchange (NSE)
  
  No agenda: The invitation letter dated on 1st December 2008 mentiones a shareholder presentation woudl take place on Thursday at 10, followed by the AGM at 11 - but no meeting agenda was contained.
  
  The report also states that the (Centum) board believes that annual general meting provides an appropriate forum for investors to communicate with the board and encourages participation
  
  Dividend day A company statement from October had mentioned that dividend would be paid at the January 14 AGM
  
  So what happened?
  
  Anonymous Comments posted yesterday include
  
  Anonymous said... You gave the Centum AGM a skip???!! Here I was looking forward to a post on that.
  Part of the drama was that the company's attorney denied a proxy audience on the grounds that co. law does not expressly provide for proxies to be heard at an AGM. I wonder how corporate s/holders are supposed to voice their concerns at AGMs in that case?
  Interestingly, a special agenda to have two directors (the Chairman and Chris Kirubi) removed was in the cards; no need to wait for the result of that coz its sure to flop since their stake in the co is significant.
  
  Anonymous (New CEO) MainaT - I think he's off to a good start. He managed the anti- C.K s/holder sentiment as best as these things can be managed i.e. by requesting the co. attorney to give an (erroneous) interpretation of co law to diffuse the anti C.K sentiments that were beginning to spiral out of ctrl.
  
  Anonymous said... Centum don't have an in-house co. attorney. They must have hired whoever was turning proxies at the door. Their co. sec. is not attorney. Curiously, did they send the annual reports without the proxy forms? Extremely strange. Very strange. CMA should take a peek at this. Some one should write a stinker, otherwise, minority views will continue to be suppressed.
  
  any more comments? and was the dividend paid or just declared?
  
  Toxic Centum Last time Centum was in the news their CEO had departed, and Discount stockbrokers had collapsed. This time the news cycle is topped by the Triton fuel scam and the departures of the Chairman of the Capital markets Authority Chege Waruingi and Kenya Airports Authority CEO George Muhoho - (more from "airport expert" - Coldtusker )
• January 14, 2009
• 4:41

  Plane moment: Mostly KQ

   » ‎ bankelele

  Tags:  Kenya Airways  

  New KQ plane
  
  After a slight delay here's the new KQ 737-800 5Y-KYE
  
  Kenya Airways gets another 737-800 from Boeing tomorrow. Bold expansion at a difficult time for many airlines, and KQ is still increasing routes and frequencies but can reduced fuel prices be passed on to passengers?
  
  Regional Routes
  
  Air Tanzania was suspended from flights and offered a $2 million bailout by the government only?
  
  Zambian Airways suspended flight without notice citing high fuel costs.
  
  Virgin Nigeria suspended flights to London and South Africa.
  
  Delta is US is expanding routes in Africa later this year (e.g. Nairobi in June) and so South African Airways will start a nonstop service from New York to Johannesburg in May that leaves earlier and allows for seamless connections on to other African destinations
  
  Flight of Woe
  
  
  
  On a recent local flight, the aircraft was found to have puncture at a mid-way stop
  
  So the airline attempted to move the passengers to a more refined vehicle
  
  
• January 13, 2009
• 7:58

  Regulator reassures depositors

   » ‎ bankelele

  Tags:  triton  

  Titanic Triton
  The Central Bank of Kenya has issued a statement to reassure depositors at some banks that have had some panicked customers want to withdraw and safeguard their funds at their banks which they believe may be exposed to the Triton fraud and fall – which CBK says is less than 0.002% of the banking sector. Read more
• January 09, 2009
• 6:31

  Best bank for netpreneurs?

   » ‎ bankelele

  Tags:  SME solutions  

  This is based on a skunkworks discussion thread and as many answers are welcomed. A growing number of young Kenyans are now making money online from blogs and websites; They often earn money in and receive foreign cheques for $50, $100 or $200 (e.g. from Google Adsense) but have different experiences when they try and encash them. I use Co-op Bank, but the cost of Kshs. 1,000 (losing ~13%) to get funds one month later is something I’m sure another bank can improve on
  
  My questions to the netpreneurs earning from advertising and other online sources is what did you do with your last adsense cheques? Where do you bank them? What kind of bank account do you have? How much does it cost to clear such a cheque and how long before funds are available? and finaly What do you as a young digital entrepreneur /internet like about your bank?
  
  Results (after a week)
  Concept says Family Bank - Kshs. 650
  I say Co-op Bank - - Kshs 1,000
  and KCB Customer Service the only of three dozen banks to reply to e-mail says minimum Ksh.800 maximum Ksh.4800 plus postage charge of Ksh.300. (so Kshs 1,100)
• 0:10

  New Years Gift

   » ‎ bankelele

  Tags:  Suze Orman  

  Still making financial plans for 2009? Here's a free gift forward from Oprah’s site: You can download a new free e-book by personal finance guru, Suze Orman's i.e her new 2009 Action Plan book out this week.
  
  The author gives some background on the books which can be downloaded here.
• January 06, 2009
• 9:10

  Which Kenyan bank has the best transaction accounts?

   » ‎ bankelele

  Tags:  bank service  

  I’m looking for a new transactional bank account for the year. Generally need to low cost, quick, pleasant service, forex, standing orders, cheque book, ATM network, probably an introduction credit card etc?
  
  Which Kenyan bank has the best current account?
  ( surveys)
  
  My top choices are Equity, Stanchart or Barclays. Indicate appropriate tariffs and put your comments/reasons below.
  
  Thanks
• January 03, 2009
• 1:51

  Media Bill 2008

   » ‎ bankelele

  Tags:  Media bill  

  (Download and read the KCA Bill 2008 (PDF) here)
  
  Regarding the Kenya communication (amendment) bill 2008: Like with the last controversial media bill, getting a copy of the bill that has the media up in arms has not been easy.
  
  I’ve seen one PDF version of the bill, and these are some other aspects of the bill brought forward by now cowed permanent secretary Bitange Ndemo and hapless Minister Samuel Pogishio which was on January 3 2009 signed by President Kibaki who hailed at as a milestone bill for e-commerce
  What’s in it?
  
  Content government which produces the most content gets to decide what’s in the in the public interest? Who knows what’s in demand e.g. all TV stations play music videos targeted at youth - and does that meet the requirement to of Kenyan programs that serve children - also set what time programs can be shown – does the CCK have time for this really?
  
  Controversial topics: coverage must be balanced and where a complaint is lodged e.g. on a news story, must take action
  
  E-mail (electronic record) now recognized as official communication. E.g. companies with tens of thousands of shareholders, legal correspondence
  
  Electronic contracts are now recognized in law e.g. by e-mail – they can also can include security features like an e-signature, and can be for official government transactions
  
  Electronic signatures now recognized except for wills, and title deeds
  Electronic fraud/forgery now outlawed, but the maximum fine is just 200,000 (~$2,500) or two years in jail
  
  Electronic files now admissible in court if it meets criteria specified e.g. the requirement of banks to provide physical statement and letters in court, can now be substituted by printouts. In addition tasks performed over several computer networks can be deemed t have been on one computer and qualify
  
  Kenya gazette electronic version of the Kenya gazette now recognized as authority
  
  Fair play new restriction include monopoly of programming and unfair competitors may be fined up to 10% of revenue (ii) but also discrimination of some kind is banned – this could be outdated as mobile companies in Tanzania and Uganda have introduced location based discounts - depending on their location at the time of calling and the level of traffic on the network
  
  Hacking now outlawed, but the maximum fine is just 200,000 (~$2,500) or two years in jail. Elsewhere it states a fine of 1 million and jail of 5 years
  
  Infrastructure sharing e.g. mobile phone towers may be shared, where no agreement can be reached between providers minister may mandate this (co-location)
  Mobile phone reprogramming outlawed 300,000 or 3 years in jail for those seeking to unlock the I-phone. Elsewhere it has been said even downloading or changing the ring tone on your phone constitute reprogramming
  
  Movie censorship empowers decisions made by the Kenya film censorship board ? to bar/edit films they have reviewed
  
  Pornography outlawed– publication of obscene material online (including forwarding of obscene e-mail) liable to a fine of 200,000 and 2 years jail.
  
  Vernacular radio/TV elevates and restricts vernacular broadcast stations – mandates that members of the community participate in the selection and provision of programs to be broadcast. But also restricts what parts of the country they can be broadcast - what is the interest of one media house to broadcast in several languages?
  
  Summary
  - Regulator CCK (communications commission of Kenya) gets powers it does not need nor do the members understand, but they can hold them just in case, or till the day they need them like the next election
  - New tax (i) universal service fund charged on all licenses – mobile phones, television, radio etc. which the minister for information will set. funds raised can be given out as loans or grant for provision of service to rural or under-served areas
  
  Overall an omnibus bill combines communications and broadcast, good and bad characteristics, it is here to stay and we all have to adapt to it now that it is law
  
  More training needs to be done now, at the judiciary - on the new laws, at banks and companies - on the consequence of e-mail communication since its now binding and enforceable, and in offices everywhere - on the sharing of passwords and other secure resources
  
  Banks have a framework for e-commerce; also there’s more government bureaucracy in this bill – a universal service advisory council, and more members to the CCK Board.
• January 02, 2009
• 8:50

  Event Blogging from Tanzania

   » ‎ bankelele

  Tags:  sumitomo  

  
  
  2008 was still a great year for the blog exxcept for my low travel schedule - travel is invigorating, and is the my life blood of writing and I really hope to do more out of town corporate excursions this new year.
  
  Almost a year ago I was fortunate to get a gig at for AllAfrica (thanks Mental) to cover and write about a factory opening in Arusha.
  
  I had read the authoritative conference blogging guide by Ethan Zuckerman and gratefully hit the road with an interesting group of media types, on a brief escape from the post-election machinations going on in Nairobi
  
  Here’s the two part report of the factory opening (see also the official factory site)
• December 31, 2008
• 8:11

  Kutwa Tuesday: December 31 2008

   » ‎ bankelele

  Tags:  Uchumi  

  1. Yes it’s Wednesday
  2. this is the final post for 2008
  3. Happy New Year
  4. Welcome first time readers searching online for primary school exam (KCPE) results. This is a blog on finance and investment issues in Kenya mainly
  5. stories you may have missed in December 2008
  
  - National Oil Corporation NOCK will borrow $65 million from French Bank PNB Paribas
  - Triton Petrol (now under receivership) has left several local and international banks exposed to bad loans. They were also partners of Reliance (India) in the second national Operator contract
  - From January 2009 Kenyans can buy government bonds and bills for just Kshs. 100,000 (~$1,300) through the Central bank of Kenya. The next bill auctions are on 5th January for bills while bond are on 26th January. one must open a CDS account with the CBK (currently they hold 4,222 accounts that trade in GoK securities) more details here
  - The CBK also released a report on commercial banks readiness and compliances with Basel II requirements
  - New branches Banks opening new branches in December were National bank of Kenya (Kakamega, Eldoret airport, Embu, Ongata rongai), Bank of Baroda (Nakuru) and CFC Stanbic (Kisumu, Westlands – Westgate)
  - Dyer & Blair Investment Bank will arrange a fund raising plan for TransCentury, one of Kenya’s leading Private Equity firms
  - Standard Chartered expected to roll out a mobile banking platform in 2009 in Kenya for funds transfer, utility payments etc. (already operational in Uganda)
  - Uchumi made a payment to debenture holders in December, can it re-list at the Nairobi stock exchange in 2009?
  - Co-Op Bank shares began trading at the NSE – but mini bounce on day one was not sustainable
  
  from the blogs
  - Kshs. 2.5 billion worth of Equity shares trade hands in a surprisingtrade yesterday
  - NIC Kenya’s leader in asset finance, but more retail and corporate has ventured into Tanzania acquiring 51% of S&F Bank - more here
  - Want to buy goods online, but you don’t have a credit card – read up on Afripay - a local company that offers that service in Nairobi
  - Why is it so hard for foreign (German) companies to invest in Tanzania?
  - While Pirate terrorize the east African Coastline, what should be Kenya’s flagship navy vessel is rotting away in Europe.
  
  
• December 29, 2008
• 8:30

  Bank’s Need to Embrace MPesa

   » ‎ bankelele

  Tags:  Safaricom  

  
  
  banks need to adapt to M-pesa, not fight it
  
  A recent Nairobi Star story links banks to m-pesa probe in an underhand move to stifle the growth of mobile company Safaricom’s money transfer service - M-Pesa.
  
  How much growth? As a recent article put it four million Kenyans can’t be wrong in reference to those who have signed up for the M-pesa and which the company recently stated to be clocking up to 10,000 new registrations per day!
  
  Here’s why:
  
  1. It makes sense and that's all the law it needs Is it illegal and does it need more legislation? The answers are probably not and yes. Probably Not - because you can’t legislate everything, more so the simple payment of cash from person A to person B - whether a prostitute or a priest. And Yes, M-pesa agents need to beef up security, systems and training of staff as its popularity grows.
  
  But the argument that M-pesa will be used for money laundering or other crimes is laughable - who launders less than $500? (Kshs. 35,000 is the maximum transaction amount on m-pesa) You are more apt to find a transfer of Kshs. 35 million at a bank - and banks were themselves used to prop up the numerous local pyramid schemes before they all imploded.
  
  2. M-Pesa is affordable banking: Is it unfair? What’s to stop a bank from operating branch-less accounts? Several small banks have 1 – 3 branches and can comfortably and profitably serve their customers. Most Kenyan banks still don’t want to serve the unbanked and M-pesa has evolved because banking is still too expensive for the masses. There’s Mzansi in South Africa and in the absence of a similar program, Kenyan masses have created their own Mzansi in M-pesa. It is not Safaricom’s fault that they are so popular – take away m-pesa and people will go back to stuffing cash in tins, rolling them in blankets and mailing them in cartons on buses. They will not go back to open new banks accounts or queue at western union.
  
  3. M-pesa is better than banks in some functions: Two scenarios
  - Having a bank account is of no use sometimes, as one executive told me. She may be in Malindi looking to hook up Flavio Briatore or find Obama’s village (Nyangoma – not Kogelo) - her bank account is in Westlands (Nairobi) she has no way of reaching that money (avoid credit cards) - but her bank has no presence in many parts of the country, but from where she can access M-Pesa
  - I received a small cheque payment of Kshs. 10,000 shillings ($130) that I deposited in my bank account on 19th December – today it’s 10 days later and the cheque has not cleared – reason is that four working days have not elapsed - (banks don’t count weekend or holidays – thought they work six days a week). What the banks does - transferring money from a creditor to a debtor (me) is no different than what M-pesa is doing. But with access to the same technology and similar resources, M-pesa takes 3 minutes, while the bank system takes 10 days.
  
  4. M-Pesa is going to get more mainstream: More corporations are embracing the cost cutting and simplicity of M-Pesa. You can now pay for satellite TV (GTV), some insurance plans, and mutual funds (Old Mutual) by M-pesa. Next up will probably be two large companies that are in dire need of a cheaper alternative of money transfers
  - Safaricom with its 800,000 new shareholders will probably have to pay a dividend next year. The use of text messages/e-mail and M-pesa will save the company millions of shillings that would be spent on printing, postage and cheque processing charges
  - Kenya power & lighting company; as KPLC takes electricity to thousands of new customers in rural Kenya and inner cities, it has a dire need for cash collection points. It has used the banking system and the post office (paying an average Kshs. 30/= for each payment), but M-pesa would be a cheaper (for them) and more convenient option (for distant customers) who can also have been alerted by SMS on how much to pay.
  - Also microfinance institutions (and shylocks) – who make small loans, for short periods of time. The sooner they can transfer funds, the clock is ticking, and their customer can access funds immediately and pay them back at the last minute without each having to wait for cheques to clear. M-pesa fits into the last minute thinking of many Kenyans – who tend to wait till the last minute to do many things including payment of electricity bills!
  
  Banks need to change and embrace M-Pesa as it is able to do some things they can't or won't do. e.g. The lady in scenario one has a relationship officer at her bank, who can move her funds from one account to another – why not also enable her to M-pesa the next Ms. Briatorie her money? This can be an extra service from bank from which they can earn some income, instead of opening a branch in Malindi?
  
  They should take a cue from other players such as
  
  - Pesa point (ATM network) who may be losing some business to M-pesa but have now have embraced and partnered with them so that customers can withdraw cash from M-pesa 24 hours a day at any of their Pesa Point ATM
  - Western union whose local money transfer system may have been eroded by M-pesa will now be the international arm for remittances through Safaricom's M-Pesa
  - Banks like Housing Finance and Family Bank already process M-pesa payments for their customers.
  
  FYI
  1. Are you a heavy M-Pesa user? Did you know you can get a statement of your M-Pesa transactions - a statement of the last three months costs Kshs. 500 from Safaricom, which is about what many banks charge for interim/instant statements
  2. Want to become an M-Pesa agent?
  3. Other interesting recent posts about M-Pesa.
• December 20, 2008
• 8:49

  Why I blog about Africa

   » ‎ bankelele

  Tags:  Tagged  

  
  
  
  Was tagged by Mweshi my brother from TED Africa on why I blog about Africa
  
  It’s about telling my story. No one else can tell it, I can’t even tell it myself
  
  I am uniquely privileged and challenged and I have access to opportunities and difficulties that constrain me. This is my record of life in Africa, a land of challenges and of opportunities, and I try and tell about both, but with an emphasis on the opportunities for an ex-Diasporan.
  
  I have spreadsheets, annual reports, statements and certificates, but they are static; this blog gives life and flesh to those numbers and papers.
  
  Finally this is my diary, my record of important events - about me and my business world & economy, the blog simply helps me keep track.
  
  Finally, it has opened up a whole world of opportunities, some small material gain but more of the networking kind and opportunities and new friends - and I hereby extend the tag to fellow financial bloggers - Coldtusker, Terry Anne, Ka-Investor, Fintrade Capital, MainaT, Kenyanentrepreneur, and Maishinski.
  
  Happy Holidays
• December 19, 2008
• 5:43

  2008 Kenya Bank Review

   » ‎ bankelele

  Tags:  KCB  

  What happened in 2008?
  See also half year. (who?, what? means no news of note)
  
  ABC: (25) who?, what?
  Bank of Africa: (18) Quiet expansion becoming big in asset finance and the bank of choice for French interests, with a new club for small business owners
  Barclays: (2) steadying their 2007 rapid growth and expansion in the retail sector, launched two tranches of bonds at affordable prices which made CBK notice and will go into mobile messaging next year
  Baroda: (14) Going retail, and opened new branches, no longer playing safe and investing less in GoK securities
  CFC Stanbic: (4) merger (takeover) by Stanbic formalized. Collapse of small brokers a boon as they are seen as being safe(r). Will open branches and may need to raise capital next year. Note: If the merger had been planned this year (instead of last) it would have cost ½ as much
  Chase (22) one of the fastest growing banks in ’08, ventured into stockbrokerage, but may need to raise capital next year
  Citibank Kenya: (8) best return on assets in sector, but with aggressive off balance sheet. Still unclear how much parent troubles will impact subsidiaries in Africa.
  City Finance: (43) the country’s smallest bank effected a capital reduction. New owners yet to settle in, but may achieve a slight profit this year
  Commercial Bank of Africa: (7) would be a beneficiary of American business interests following Citi bank woes, if it didn’t also own 1/3 of equally troubled AIG Kenya. Also CEO got caught up in Uchumi corruption case and may need capital next year.
  Consolidated: (31). Cabinet has approved sale for next year and the deposit protection fund has always planned to exit. 2008 will mark the third year of (modest) profits for the bank, so its eligible for an NSE listing or IPO
  Cooperative: (5) went ahead with an IPO and NSE listing late in 2008 in a difficult market to raise capital for expansion
  Credit: (35) who?, what?
  Development Bank of Kenya: (26) in play next year as GoK (ICDC owns 90%)plans to sell shares in the development finance institution to the public or private investors
  Diamond Trust: (11) continued regional expansion with more investments in Uganda and Burundi, and also had a second rights issue to raise capital.
  Dubai (42) quiet year, will make a loss
  Ecobank: (19) arrived in Kenya big and are setting up retail presence (nairumor that they are the bank Equity emulated to succeed). Came up short in a (huge) pan-African capital raising move, but plan to enter stockbroking next year
  Equatorial: (30) activated investment banking wing, but denied they were being sold to Libyan investors
  Equity: (6) stellar growth continued though January ’08 showed an exposure to political undercurrents. Bounced back with branches in Nyanza, agricultural products and participation in the Safaricom IPO. Bought a Ugandan bank and are investing in S. Sudan in a diversification move they hope to take their model (bankign the unbanked) to more African countries.
  Family Bank: (20) quiet year, but income tripled in ’08 and new CEO was confirmed
  Fidelity: (33) who?, what?
  Fina: (21) the Rwanda turf was invaded by a host of other Kenyan banks led by KCB. Continued a much heralded focus on SME‘s and expanded into Uganda.
  First Community: (40) the second Shariah bank got off to a much quieter start than Gulf and will record a major loss this year from setting up operations.
  Giro: (27) who?, what?
  Guardian: (28) who?, what?
  Gulf African: (36) new Shariah bank seems to be well received and respected by business people. Opened several branches and will also assist the GoK youth fund with loan products, but will make a loss this year from start-up costs.
  Habib AG Zurich (24) who?, what?
  Habib Bank (34) who?, what?
  Housing Finance: (15) had a fully subscribed (just) rights issue that raised Kshs. 2.4 billion and Equity Bank now own ¼ of the institution.
  Imperial (16) who? what?
  India (17) who?, what?
  I&M (12) new formal name for the former investment & mortgages bank, also got new shareholder capital (two euro dev banks) and opened new branches
  KCB (1) Kenya’s top bank this year had another rights issue, rebranding and supported expansion to Uganda, Tanzania, South Sudan in addition to being cross-listed.
  K-Rep: (23) surprising loss will be recorded as it appears the post election violence impact small enterprises they financed.
  Middle East: (38) who?, what?
  National Bank of Kenya: (9) went big in the Safaricom IPO (and to a lesser extent with Co-Op). Some activity expected nest year as the government and perhaps NSSF shares may be in play for a strategic investor now that their balance sheet is largely cleaned up
  NIC (10): rebranded again this year, phasing out MOVE and establishing new branches as a one-stop shop for corporate, asset finance, investment banking (acquired Solid Stockbrokers) needs.
  Oriental: (41) former Delphis bank should have an operating profit this year
  Paramount Universal: (39) who?, what?
  Prime: (13) a year of rapid growth for this bank, big with Asian business owners, but may need to raise matching capital next year
  Southern Credit: (29) who?, what?
  Standard Chartered: (3)steady, least aggressive of the big banks in Kenya went after the retail crowd this year with personal loans, cards and youth accounts. Will launch mobile app next year
  Transnational (37) who?, what?
  Victoria: (32) who?, what?
  
  Major Stories
  1. CBK eternally optimistic governor, lowered bond prices, lowered cash ratio and – but statistical /economic forecasts called into question, and mired in sale of the Grand Regency Hotel
  2. Safaricom the bane of banking sector was M-pesa and the company’s IPO
  3. Capital raising: through right issues, private placements and IPO (Co-Op) more are expected
  
  Coming soon
  banks expected in 2009
  - UBA
  - Faulu or KWFT
• December 16, 2008
• 23:00

  Co-Op IPO Aftermath

   » ‎ bankelele

  Tags:  Kenya privatization  

  A formal statement is out today after Monday's press conference where the bank’s management revealed that through their 2008 IPO, Co-op Bank had raised Kshs. 5.4 billion (~$77 million) but short of a revised target of Kshs 6.7 billion as 66,576 shareholders bought 546 million shares. The Business Dailyreports the shares will be allocated 60% to individual investors (340.5 million shares) , 30% to institutions (171 m shares ) and staff will get 9% (52.6 m shares)
  
  Capital raising: the offer was not underwritten (by D&B winner - best lead transaction advisor and best investment bank), but despite the shortfall, what was raised should be enough for a few years. Co-op’s capital adequacy goes from 9% to about 18%, which is not bad [10 billion would have taken to this to 22%]
  
  Other banks that have been reported to have engaged in recent private capital raising include K-Rep and Southern Credit while others who may need to tap shareholders next year could Chase, CBA, CFC Stanbic and even KCB (for the third time in five years?)
  
  Glass Half Full: Though Co-op had initially set out to raise Kshs 10 billion, their listing came at a tough time and was not received as enthusiastically as past IPO’s. Still it had some positives but came in a tough market before the target was revised down, but has some positives
  
  - For the bank: 66,000 shareholders is a manageable register , and since they did a lot of the placement and receiving work in house, the IPO was not as costly as others (budgeted at Kshs. 248 million)
  - For new shareholders: no refunds to queue for, and for once a 100% allocation
  - For other serious investors, a brief return to sanity as the IPO speculators with their borrowed funds kept away – Co-op was the fall guy that injected some reality back into IPO process and share investments.
  
  2009 IPO’s: Next year could see the entry of Nakumatt supermarkets, bread maker a DPL and others from the private sector.
  
  From the public sector (Government side) comes a series of planned privatizations a few of which could be IPO candidates to assist the Government in fund-raising:
  
  Top of my my wish list is Kenya Pipeline, whose much improved governance saw a consortium of banks line up this month to offer the company funds for expansion (a few years ago KPC was using dubious financial intermediaries) and Kenya Wine Agencies. In addition, more shares of Kengen East African Portland Cement Company and National Bank will be sold to the public.
  
  Other non-IPO candidates will be targeted at strategic partners [for Kenya Ports Authority- and TEAMS (submarine cable)] while private investors may be sought to invest in the sugar companies [Chemelil, Sony, Nzoia, Miwani, Muhoroni] hotels of Kenya Tourism Development Corporation, banks [Consolidated Bank, Development Bank of Kenya] and food processors [Kenya Meat Commission, New Kenya Co-operative Creameries]
• December 14, 2008
• 22:55

  Electric Slide

   » ‎ bankelele

  Tags:  KPLC  

  Kengen: the Kenya electricity generating company will have its third AGM later this week – and while shareholders may be happy with a Kshs. 0.90 dividend they will also be asked to approve (i) 30% investment in a geothermal development company to be created by the Government of Kenya (ii) invest in a coal plant (iii) participate in other ventures – (perhaps buy into another IPP independent power producer?)
  
  The proposals to shareholders are vague and without any spending amounts attached, they should not be presented to a vote. When the Access Kenya board got shareholder authority to make other investments, they capped them at Kshs. 200 million each - this one has none, and the third proposal doesn’t even limit Kengen from investing within the energy sector so it could probably buy a sugar company or tea company (for cogeneration?) with that mandate.
  
  Anyway Kengen has undertaken a lot of geothermal work with three olkaria plants and is it really necessary for the Government with strained recourses to create another parastatal at this time? Shareholders who were also spooked by plans of a secondary listing of shares and plans to hive off a geothermal company from their assets two years ago will also not be happy to see that the plans are. still active.
  
  KPLC: The much heralded VAT reduction in electricity bills has not amounted to much. It was effected in the November power bills, but the reduction in VAT from 16% to 12% appears to only cover the fixed charge of a Kshs. 240 per meter – so the savings amount to just Kshs. 9.6 per consumer.
• December 11, 2008
• 9:47

  IPhone to Kenya

   » ‎ bankelele

  Tags:  iphone  

  Today will see the official launch of Apple’s i-Phone (3G) into the Kenyan market by Orange mobile.
  
  You could say it’s a case of bad timing as Kenyans are going through tough economic times and perhaps entering a recession period.
  
  Recession or not?: With (very) high prices of petrol (until recently), electricity, maize and other foods, a spike in the government deficit, global financial turmoil, fewer tourists, reduced remittance volumes all signs would point to an economic slow down. Right?
  
  But not the Central Bank of Kenya (CBK): I have been in the past ‘impressed’ (did I say it was the best bank site?) by the volumes of reports published by the Central Bank, mostly because they are timely, though difficult to decipher the message.
  
  The CBK reports have predicted some hardships, but remained very optimistic and rosy about the country economy. But it appears that the messages are tailored to suit the tone of the day because Kenya’s leading business newspaper has taken note.
  
  Today's Business Daily has a very harsh critique of the CBK reports (which many banks, funds, government departments use to formulate their policies). The BD editorial laments the consistency of presentation, shifting periods for which data is presented, differences in figures published by KNBS (statistics bureau) and a determination by its authors to manipulate data through a series of omissions and change of periods under review that makes it nearly impossible to keep track of ongoings in the economy.
  
  Former Nairobi Stock Exchange boss Jimnah Mbaru (who's also a sometime author) thinks Kenya is headed for a recession and has published a column which ran in some newspapers and appears at Capital FM website titled How Kenya can escape recession . He advocates (like US President-elect Obama) that the Kenya Government spend its way back to robustness. Some of the proposals he suggests include reduce interest rates and cash ratio (which have already happened) but also some strange ones like the government should buy Safaricom shares, sell buildings, and mandates that more sewers be built he also says hedge funds cashing out brought down the NSE this year...hmm.
  
  Blog views: In the absence of as Finance Minister, the Government is engaged in a series of Voodoo economics.
  
  i-Phone outlook: Looking around Nairobi with all the Hummers, new Range Rovers, new apartments complexes etc., it is clear that there’s an affluent class that does not feel the pinch of a (possible) recession and despite the tough year it has been, there have been several new entrants in Kenya.
  
  The i-Phone which has been a worldwide smash, and impressed many (not all) its customers, can be expected to do well here also. Like with the Blackberry before it - which was circulating here unlocked/hacked before its official debut, it will now be licensed and supported after the official launch.
• December 09, 2008
• 23:38

  Education Moment

   » ‎ bankelele

  Tags:  Safaricom  

  Google hosted the latest skunkworks where the debate was how to design a better computer science curriculum. Present were a team from the Google EngEDU (Engineering Education) which works with campuses to mould student skills that will enable them to adapt to a work environment at Google, and through continuous learning within Google that feeds back into universities through training.
  
  Present was a nice mix of professionals, programmers, coders, Google, who were ex-students of Nairobi, Kenyatta, JKUAT, Strathmore and other foreign universities.
  
  So what ails the Kenyan computing curriculum?
  - Universities are large factories, that focus on quantity (of students) not quality (of learning) to support their income streams
  - Lecturers are lazy (don't want to teach new concepts or learn new developments), instead they spend more time outside, on more lucrative consultancies
  - Students are programmed to (cram) pass exams, obtain degrees and gain employment. Few are inspired to learn outside, or become developers. They accept poor learning, without challenge, and will riot over food but not poor lectures
  - Engineering/ computer science curriculums are static, have not changed in years. It is difficult to change the curriculum as it involves all departments of university, and even consultation with the Government (for public universities)
  - There is little research and publishing at universities
  - There was an unresolved debate of why JKUAT is a ‘better’ institution for technology programs than Nairobi University which has more resources and ‘better’ lecturers
  
  What can be done?
  - Teach children more computer/programming skills (in high school) before university
  - Universities should be encouraged to compete more with each other
  - Corporations should establish mentorship programs
  - More programming languages should be taught, even at schools e.g. python, .net, ruby, java, not just C++ and Visual Basic.
  - Engineering students remain highly employable in other sectors like accounts and audit
  
  What else is happening?
  - Google now has a director for education for Africa (A sign of better things to come)
  - South Africa has signed up to link with TEAMS (submarine cable), and Governments now recognize that skills shortage is the next critical area to address after bandwidth
  - Google will be working with Strathmore, Nairobi, JKUAT and with other universities on design of better computer science curriculum.
  
  elsewhere
  
  Safaricom University: the latest Safaricom Options magazine talks about a corporate learning & development initiative the company has with Moi University that began in October 2006. Safaricom helps design the electrical engineering curriculum at the University to produce competent engineers with skills that are useable by Safaricom, with the top performing telecommunication bachelor of engineering students, currently in first and second year, eligible to be offered attachment places at Safaricom. The collaboration is next targeting a master’s telecommunications program (to be based in Nairobi). More on Moi and JKUAT collaborations.
  
  Universities need Change: A very timely post this week from Gukira on the difficulty of doing research from a technological standpoint at Nairobi University. For one who is used to the research recourses available at a US university, Kenyan universities are rather close-minded about IT access to research students’ e.g.
  
  - Internet resources are lamentably bad
  - Printing costs are exorbitant.
  - Could not get into the library could not even apply to get into the library
  - Faculty members teach ridiculously high loads
  Read more
  
  Multimedia University: The Government has gazetted the establishment of the Multimedia University College of Kenya, formerly Kenya College of Communications Technology (KCCT)
  
  Multimedia Cows: Over the weekend, I heard about Michigan State University research program with Maasai pastoralists – where they used GPS to track the movement of cattle and their grazing patterns to help pastoralists find pasture for their cattle easier, and by having to walk shorter distances.
  
  University Blog: Diary of a Kenyan Campus Girl is a great read about university life by a female student studying computer science at JKUAT.
• December 04, 2008
• 6:15

  Broke brokers?

   » ‎ bankelele

  Tags:  NSE stockbrokers  

  
  Buying and selling of shares in a commission generating business. Like at supermarkets, banking halls, movie theatres, pubs, hotels - foot traffic means customers which translates to income and then hopefully a profit.
  
  But some stockbrokers’ offices have gone back to being relatively quiet and in many cases empty for the most part of the day. Offices opened in the hey day of the Safaricom IPO are now empty desks.
  
  Disocunt expanded furthest and fell first. For the others; are they generating enough income? Will they be able to pay the rent? Staff? Or are their customers trading online? Trading volumes at the NSE are down (as will commission income for all) – and not all of them are investment banks able to generate income from other avenues. Even as they wait for another IPO for a boost, will it make a difference? Co-Op Bank, whose IPO ended last month, handled a significant chink of their applications in house, and did not generate much traffic elsewhere
• December 03, 2008
• 6:46

  Pepsi to Kenya?

   » ‎ bankelele

  Tags:  alvaro  

  . Nairumour that after an absence of many years, Pepsi will re-enter the Kenyan market in the near future to resume battle with Coca Cola, possibly through their South African partners. If so, it will cap a great year for investment to the country, and that despite 2008 being a relatively tough year for investors and companies, with the post-election violence, business disruption, high fuel and energy prices, depressed consumer spending, P & P madness (pirates and politicians) collapsing stockbrokers, there was a steady flow of new investments and new products that happened this year.
  
  Re-cap of some notable ones
  
  Banking
  - Takeovers concluded - Ecobank take over of EABS, and Stanbic merger with CFC (now CFCStanbic)
  - UBA licensed (2009)
  - Gulf African and First Community (Shariah banking kicks off)
  
  Beverages
  - Summit Lager a new beer from Keroche Industries
  - East African Breweries launched Alvaro (malted soft drink)
  - Coca Cola launched Novidia (another malted soft drink) and also started selling Minute maid
  - KETEPA launched Safari Iced Tea
  
  Communications
  - WPP buys into Scangroup
  - 2008 saw the launch of two new mobile operators - Orange (France Telkom) and Yu (Essar/Econet) to battle Safaricom and a re-energized Zain
  - Altech buys into KDN
  - A long-running fight over one(EASSY)submarine cable, gave birth to three different ones being laid to Mombasa
  - Wananchi launched Zuku (TV, Broadband, Phone)
  
  Transport, Energy & Manufacturing
  - Tiger brands buying into Haco
  - An investment in the Kenya Oil Refinery at Mombasa was still under battle between Libyan and Indian Investors
  - Jinchuan (China) to bail out Tiomin?
  - Mirambo and PD Toll to salvage the Rift Valley Railways
  - Delta Airlines (USA - but postponed to 2009)
  - Air Arabia started flights to Kenya
  
  Tourism
  - Libyans took over the Grand (Laico) Regency
  - The Tribe opens.
  
  Exits
  - Chevron (Caltex) sold out – bought by Total
  - Unilever (de-listing from the NSE)
  - Roy Puffet from rift Valley Railways
• December 01, 2008
• 8:03

  Urban Inflation Index: December 2008

   » ‎ bankelele

  Tags:  Nairobi cost of living  

  Four months ago last review (should be a quarterly exercise going forward) . 2008 has been a year with high prices and cost of living factors in the news. From the post-election violence in January to the (then) world oil prices, the pinch has been felt in Kenya.
  
  The Government has come under pressure, but without addressing of its own excesses (procurement, new offices & limousines, parliemantarians, councilors and judges who refuse to pay income tax), has likewise tried to run the screw on the corporate sector - resulting in efforts to reduce the price of petrol and now maize flour (staple food)
  
  Gotten more expensive
  
  Staple food: Maize flour which is used to make Ugali, that is eaten by a majority of Kenyans daily. A 2 kg. Unga pack at Uchumi today costs Kshs. 97 which is 1/3 more than the Kshs. 73 four months ago. Farming woes continue, the crop this year is bad and Unga who said that they ran out of flour, among other revelations at their AGM, also stated that the maize harvest in 2009 will be worse and high prices will continue. There have been allegations of dodgy imports and the Government is today trying to arm-twist the price of Unga down to Kshs. 55 (EDIT – the Government announced today that maize will cost Kshs. 72 in urban areas and Kshs. 52 in rural areas)
  Other food item: Sugar (2 kg. Mumias pack) is at Kshs. 160, up from Kshs. 145 three months ago. For Mumias customers and shareholders, the price is even lower for other unbranded sugar(s) on shelves.
  
  Foreign Exchange: 1 US$ equals Kshs. 79.08, (18% weaker) than the Kshs. 67.4 four months go. This is partly the strengthening of the dollar, partly outflows from Kenya (at the NSE) - and comes after the shilling (while strong) had cushioned some impact of high oil prices.
  
  Gotten cheaper
  
  Fuel: Litre of petrol fuel (at local petrol station) is now Kshs. 92.7 (~$5.40 gallon) which is about 10% cheaper than the Kshs. 101.50 seen last time. While that is still higher than it was at the beginning of the year, and oil prices are down over 60% from the record highs of mid-2008, it is remarkable that for once fuel prices have reduced. In the past they have merely stagnated and oil companies, not passed on savings to consumers, but the threat of the government to regulate the prices, and a sustained media campaign (web/radio) has resulted in a slight reduction in petrol prices. (EDIT – A leading oil marketer - Shell announced today that prices will drop by Kshs. 15)
  
  Entertainment: Bottle of Tusker beer (at local pub) is Kshs. 120 down from Kshs. 130 (cheaper by 8% from four months ago). Don’t know if this is one pub decision or the competition from new Summit beet launched by Keroche in October 2008 - the first true local competitor since (South African) Castle folded shop about six years ago. How will EABL fight back, and do they have to? Keroche got off to a good start but there has been little post launch marketing.
  
  Communications: Continues to get cheaper as two mobile phone companies have become operational in the last quarter of the year – Orange (France Telkom) and Yu (Essar/Econet). The tone was set by Zain’s successful Vuka tariff, priced at Kshs. 8 per minute to call any network. Market leader Safaricom responded with Jibambie (up to a 63% discount) which enabled their subscribers to make calls at prices ranging from Kshs. 8 down to Kshs. 3 per minute if they bought a bigger denomination airtime voucher. The battle for subscribers is shifting now from voice calls which have reached unprecedented lows to data and money transfer where Safaricom is effectively Kenya’s largest ISP and money wallet.
  
  No change: Electricity: My November KPLC bill is still Kshs. 1,900, same as it was in August, with a fuel surcharge reduction yet to be effected. High electricity prices have been a major cause for concern among Kenyan companies leading to President Kibaki to call for a reduction in the taxes levied on petrol prices and electricity.
  
  But: Related: Is the quality of official statistics inflation data in question?
  EDIT - Challenged by inflation, but with a view to improving liquidity, the Central Bank of Kenya today lowered the CBR rate (implied base rate) from 9 to 8.5% and also lowered the bank minimum cash ratio from 6 % to 5%
• November 27, 2008
• 6:37

  Unga AGM 2008

   » ‎ bankelele

  Tags:  Kenya procurement  

  The company which was founded in December 1908 by Lord Delamere to mill his wheat harvest, is now a century old. It is celebrating its fourth straight years of profits on the back of improved sales Kshs. 9.5 billion (~$125 million) and profits of Kshs. 564 million (~$7.5 million). The Chairman commented on the improvement from the time a few years back when they used to record losses and had their financial accounts qualified by the auditors.
  
  slow registration
  Excerpts: missed a few minutes of the meeting as the registration was really slow - just two ladies, with no computer. They had to write every shareholder name down, and have them sign, but without verification of their legitimacy
  
  Bonus: The company offering a (1) bonus share for each five (5) held to reward shareholders since the board had opted not to pay a cash dividend this year.
  
  Company structure: The Seaboard Corporation is a management company and shareholder that contributed to the turnaround. However their presence is a sore point with some shareholders unhappy that while they have no divined, Seaboard gets paid a minimum of Kshs. 12 million a year that will escalate as the company gets more profitable. Their agreement has also been extended by the directors for another five years and there was also a question on the loans owed to the company that could be called in at any time - an unlikely scenario according to the board
  - Shareholders also asked on the relationship between Nampak (a partner company) and Bulpack which was a joint venture between Nampak and Unga to make bags. The dividend paid that appears in the accounts was paid to Unga from Bulpak, and not by Unga.
  
  (No) Dividend: Though this was the fourth year of profits, the board said it still needed to retain cash for plant & machinery replacement and to also strengthen the balance sheet.
  
  No Maize in Kenya: Later the Unga MD Nicholas Hutchinson gave a talk on the current maize shortage and stated that the company (Unga) had ran out of maize (corn) stock floor eight days ago. He said there is not enough maize in the country, and the late decision by the Government to import maize, means it will trickle to the markets slowly – by mid December. The Cabinet may release more to millers, but the Government also wants to build up grain reserves and assist displaced people (flood, post-election violence victims)
  
  The maize harvest this year was bad - Unga is offering Kshs. 2,500 per and 2,250 in Nairobi and Eldoret respectively but are still not able to get enough maize so they are operating about 35 – 40% which may show in the coming results
  
  For consumers faced with a high retail price (just under Kshs. 100 for a 2kg pack, it’s a good time for farmers, but bad for consumers (dangerous?) - as prices may not drop significantly even after the supply. He said that the Government will be importing maize to Nairobi at Kshs. 2,500 if no duty is paid and that it must speculative ventures – which has affected supply of maize. Also, next year's maize harvest could be just as bad.
  
  Receivables: are much higher than the year before. Management responded that its from their increased business. They had in fact reduced the number of customers i.e. 55 key wholesalers that they deal (down from 140) with and gave them incentives to pay cash or open bank guarantees.
  
  Outlook: - Asked about market share, management said it was growing. They focus on urban markets and supermarkets, and don't emphasize rural sales as entrepreneurs can flour mill and sell it cheaper than Unga branded products.
  - Other subsidiaries: are performing well like the Uganda one and animal feed division - Unga had anticipated a maize shortage so had started to substitute maize with wheat in their animal feed. Wheat subsidiary is good though the current good prices may fall next year
  
  Shareholder gift
  Goodies: Each shareholder present got a voucher for a bale of baking flour. Which retails at about Kshs. 1,500 ($20)
• November 25, 2008
• 4:50

  Bank waters

   » ‎ bankelele

  Tags:  Safaricom IPO  

  In the pool
  
  Diving in: Another West African bank giant UBA follows Ecobank after apparently having secured a banking license to operate in Kenya.
  
  Treading in the shallow end: Still finding their ground are the new Islamic Banks - Gulf African and First Community that started business last year. They are likely to be the only banks that will record losses of at least Kshs. 200 million each as their new branches and staff continue to reach out and educate customers on a new way to bank.
  
  Had enough swimming?:
  (i) Morgan Stanley who were supposed to introduce long term foreign investors to Kenya with a five year window or longer, but instead brought in short term investors at the expense of the Government and othrr investors who took out their profits in a week. Another lesson learnt a long way back from the IPO.
  (ii) The Kenyan unit of Citi is on track to rake in profits of $50 million this year on the back of aggresive trading, but will it be enough, or will it be bled off by the parent unit? And who would buy it and its lucrative American interest-linked business portfolio?
• November 22, 2008
• 1:29

  Tujuane: Transforming from Employee to Employer

   » ‎ bankelele

  Tags:  Strathmore  

  Tujuane is a network with almost 3,000 worldwide members, it is an offshoot of Nairobist that was founded in 2006, by a group of ex-Boston graduates who chanced on a means to network and interact beyond Facebook-type connections, but with actual get-togethers and network forums. It has almost 3,000 members including 45 in Kampala, and Dar es Salaam each who communicate and share through newsletter, listing of theirs businesses, a book club soma, surveys and meet-ups.
  
  On November 21 in Nairobi, they held a mixer – or a networking event dubbed The Road from Employee to Employer with an address by Dr. Mulengani Katwalo, the director of theInstitute for Strategy & Competitiveness (ISC) at the Strathmore Business School.
  
  
  Dr. Katwalo - Photo courtesy of EGM
  
  
  His talk centered on what local entrepreneurs/business owners can change to enable them to succeed in business. Success is not about starting a business – as anyone can find business plan on the Internet – with the unfortunate result that that 60 – 70% of entrepreneurs fail in the first year. This is because they behave like athletes who try to go from starting to running, but who don’t warm up first:
  
  Entrepreneurs can make changes in six areas to ease the transformation
  
  1. Training/skills development: Many entrepreneurs may have the drive, and the money but lack some skills, necessary to understand customers, and make a transition to understand their business/industry to take it to the next level. They should engage in short courses, but more important they should contribute to the agenda of education. E.g. by working with universities to set the learning curriculum for business such as the local tourism sector.
  
  2. Innovation : Entrepreneurs do not engage in research & development (R&D)(by show of hands no one in the room was engaged in R&D departments/capacities) - and there are no budgets for new ideas and creations. Entrepreneurs need to embrace the process of buying and selling knowledge. If you have a good idea and cannot use, can you sell it?. The developed world is about exchange of ideas, not just goods & services. We need to convert ideas into cold hard cash.
  - Entrepreneurs should know there is nothing wrong with copying, benchmarking, or reverse engineering. E.g. the Nyayo Car may have succeeded if it had been built in collaboration with a Japanese company and with just a Kenyan name. That’s how Tata rose to become a world leader in the sector. Presently there’s still a local mindset that doing imitation is inferior.
  - In business, be brave enough to learn, pick an idea and use it. The patent for kyondo (baskets) is owned in Japan, and when you see Japanese tourists taking photos, a lot of them act as blueprints for products
  - Innovation is crucial, but its not about going to the lab only – its about getting new ideas and converting them into products and services e.g. in Kenyan hospitals, while equipment is new, there has been no innovation in service
  - Entrepreneurs should not stop innovating: Once you make enough money – the tendency is for many to move to big (Karen) houses, buy big cars, get new wives etc. They don’t create legacies that sustain wealth, so that every generation has to start over again.
  
  3. Culture: There is a bad (local) attitude and perception that needs to change specially in regards of treatment of customers. This bad Matatu treatment towards customers, as though entrepreneurs are doing them a favour is bad for business. Entrepreneurs do not owe customers a favour - they are providing a service, which customers are paying for. Until our customer service changes to reflect this change in attitude, we will always be second best. In other countries, even if someone doesn’t like you, they will serve you and take your money – and ensure you (as a customer) keep coming back.
  - Customer acquisition skills are poor – entrepreneurs do not keep up with innovation in the industry, they don’t read much. There's a lazy tendency to finish work, go to bar and then sleep. To be a world-class entrepreneur, you must make sacrifices, take make deliberate efforts such as take courses to develop management skills and read books otherwise they will always remain second best.
  
  4 Neighborhoods If you don’t know your market, you will always be the village beauty Entrepreneurs need to know what opportunities exist beyond their neighborhoods or they will never take advantage of them. Do you look at your market as the Westlands area (a Nairobi suburb) or the 100 million + people in the greater East Africa – Congo, S. Sudan, Somalia? Only those that have eyes, can see the market, like the South Africans who have invested here in Kenya.
  - It's also a perception issue, when you see people – do you see market or problems – what is your attitude towards expansion? Exporting to Europe? etc.
  
  5 Cooperation or competition - This is an increasing trend in the business world to cooperate rather than compete – because not all your competitors are your enemies. This can also work in knowledge exchange (there’s appears to be a marketing understanding in Nakumatt and Tuskys, though both supermarkets, are not competitors as they target different clientele
  
  6. Cooperation - working in networks (like Tujuane, clusters, create linkages, exchanges etc. as individual businesses do not exist in isolation – so entrepreneurs should network with related companies. We had a stimulating group discussions in which participants listed reasons for joining a network as among others - get contacts in the industry, socializing [with like minded people] as they are very busy, Learn new ideas[raises competition], Synergy, Pooling of resources/barter of services & goods, learn new opportunities and for moral support [e.g. for freelancers who work from home]
• November 21, 2008
• 6:34

  5 Investments for 2009

   » ‎ bankelele

  Tags:  Investing in Kenya  

  The year is about done and its time to start planning for 2009, with alternatives to build alongside the shares portfolio that will be carried into the new year.
  
  1. Money Markets: Unit trusts are currently offered by African Alliance, Old Mutual, British American, Stanbic, CBA, Suntra, Zimele, ICEA. The bare minimums for signing up are about Kshs. 100,000 (~$1,300), initial fee of 2% and annual fee of 2.
  
  2. Real Estate: It’s time for to undertake a real estate investment that should be done in 2009 following the Pesa Tu’s blueprint though financiers have gone rather shy and some developments appear to have stalled. Have we reached a real estate peak after which it becomes a speculative bubble?
  
  3. Social Networks: Need to invest more in offline social relationships – with buddies, friends, mentors, peers, chama societies and sports for spiritual, social, and physical health.
  
  4. Travel more: My passport has grown mould this year and the need to breathe a different sort of air, see new sights and meet new people - locally and internationally is imperative for 2009. I had always wanted to visit Sauri – the Jeffrey Sachs millennium village, now I must add Kogelo to my travel plans for western Kenya
  
  5. Become a pirate?: Investing is about risk and reward and the numbers are there for the new hot profession of late 2008. It’s not very different from what is my daily bread anyway.
• November 19, 2008
• 2:11

  Tandaa Roundup

   » ‎ bankelele

  Tags:  Kenya ICT  

  I was not able to attend last week's Tandaa - the first content conference hosted by the Kenya ICT Board, but have been noting what was said, and for other absentees, here’s a recap:
  
  Rombo asks where were the bloggers? Multiple speakers acknowledged the important role Kenyan bloggers now play in generating and distributing Kenyan content. and later the (Kenya) ICT board has set aside US$4 million to be disbursed over the next four years to fund feasible Kenya content generation projects.
  
  Kenyan Poet was there, gave a talk and also added a photo album of Tandaa photos from the event
  
  Another nice recap from Kipkemoi who notes It is heartening that many website owners are earning good money from e-commerce… points that came out:
  - There is a market for local content.
  - The pay for registration model for portals and content sites isn’t feasible at the moment.
  - Monetizing mobile content provision is easier. (because mobile users are used to paying for services)
  - Government registration need to be streamlined, too many vague licences
  
  From Brighter Monday - numbers don’t lie - While we continue to complain that there is no ecommerce in Kenya, this company realized a turnover of $2 million in 2007. Now that was eye opening. Well from my analysis I know this takes hard work. To prove this, they have about 8000 inbound links! And they are leaping of the fruits. (Anyone who was there can please confirm my figures in article's comments on this below);
  - I was also impressed by (kenyanpoet.blogspot.com); I think she depicts a good example of successful blogging. A snapshot of her traffic analysis showed that 42% of traffic came from referral links, 40% from search engines, 16% was direct traffic while 4% was in 'others'
  
  The Mars Group Kenya blog voiced the questions that I’m sure many attendees had in mind i.e. where’s the money? - I am a large local content generator and run a Kenyan governance and transparency web portal with 19 thematic sub-domains containing over 1 and a half million terabytes of local content including digitized government and official reports on the national budget, government, state corporations and good governance. The site also features original multi-media resources including online news content generated by a team of 17 Kenyans all below the age of 30….In its first year of operation it got over 20 million hits, registered over 7,000 subscribers and webcast live international events including the November 5th election victory of Barack Obama from the US Ambassador’s Residence from http://marstv.marsgroupkenya.org .The site is regularly cited as an authority by local and international media and was recognized as a new media exemplar by www.opendemocracy.net.
  
  Offline comments from the Skunkworks forum include a lengthy one from Robert Alai who commented that We must focus on local mpaka it becomes music……If you wanted a subscription website, you should have started with kenyalaw.org. If you wanted affiliates, mamamikes.com has affiliates. Lets focus on local…local examples and then mention the foreign ones just .. when you make people believe that Facebook is great, we won’t head anywhere. See why Tanzanians are engaging more in bongo5.com and jamiiforums than facebook and others. They are actively loading pics and content and these two websites are really coming…..up well and considering the age of the websites, we will see nice things from them. We should not glorify anything western. We must start appreciating our own facebook like Ngari has developed a good site, www.kasarani.com
• November 14, 2008
• 8:53

  KCB Back on Top

   » ‎ bankelele

  Tags:  KCB  

  Now KCB Country: It’s been a long climb back, back but KCB will finally top the Kenyan bank rankings and will lead into 2009 on after overhauling perennial leader Barclays.
  
  
  At the end of September, Barclays, led with Kshs. 173 billion in assets ($2.36 billion), even with KCB at Kshs. 172 billion [KCB group is at Kshs. 184 billion – through S&L, Uganda, Tanzania, S.Sudan subsidiaries]. But by 2010, it could be a different story. Three years ago, in September 2005, the score was Barclays 106 billion (1), KCB 70 billion (3) – and at that time Equity Bank was at Kshs. 10 billion (No. 13) – but today Equity is at Kshs. 75 billion (zooming in to No. 4)
  
  Capital Issues
  - Today is the last day for the Co-Op IPO.
  - Strike out banks identified as probably going to raise capital a year ago - Kenya Commercial, Cooperative , National Bank of Kenya cabinet approved share sale, Commercial Bank of Africa, Standard Chartered, Stanbic, Investment & Mortgages got new shareholders, Barclays, Equity, and CFC/Stanbic.
  - City Finance Bank shareholders voted to reduce the banks issued share capital to Kshs. 400 million down from 1.6 billion through a cancellation/change in the par value to reflect past losses. Current capital is 331 million
  
  Who’s the Real Marshall?: Two notorious ex-bankers and Kamlesh Pattni and Ketan Somaia who have feuded for control of Marshals Limited (Tata, and formerly Peugeot franchise holders) should prepare for another encounter as the registrar General has called for a meeting in December to iron out the ownership of the company.
  
  Bankers cheques only: If you want to visit and see wildlife in the Masai Mara Game Reserve, the Narok County Council will insist on payment of park fees by bankers cheque only from December. Since the Council collected Kshs. 573 million (~$ 8 million) in game park fees last year, is there concern that more was lost?
  
  Fuel Fixed: The government has today gazetted petrol price margins for major towns in the country
• November 11, 2008
• 23:04

  Kutwa Tuesday: Sam’s Kids

   » ‎ bankelele

  Tags:  alvaro  

  
  They may be called Barack, Michelle, Obama, or other creative names, but many of these new kids born and given fabulous American
  baby Obama names were conceived as a result of Uncle Sam’s bungled election debacle in December 2007.
  
  
  Opportunities
  
  Airbus University Challenge: the Airbus
  Fly Your Ideas challenge is open to university students around the world with ideas on the future of aviation and improving its environmental position. Prizes are €30,000 and deadline is 1st December 2008
  
  Georgetown Fellowships Apply for the Georgetown University Law Center’s Global Health Law Fellowship Program. D/L is February 16 2009
  
  Kenya Content Conference Tandaa 08 a local content conference sponsored by the Kenya ICT Board takes place on November 14 2008.
  
  Kenya’s Top Women The Business Daily invites you to nominate Kenya’s Top 40 women under 40. send their names, contracts and reasons why they are worthy (in less than 500 words) to top40under40@nation.co.ke by 30th November
  
  Government of Kenya jobs:
  - Judiciary 25 resident magistrates. D/L 21/11
  - Electoral commission of Kenya – 39 district election coordinators
  
  Biz brief’s
  
  Co-Op IPO: is 1/3 of the way to target with just 3 days to go optimistic about the Co-Op IPO. transaction advisers have now released cash flow and share price projections that should have been in the Co-Op Prospectus. what happens if they fall short – will D&B pay C-op for the shortfall? Is there a last minute investor who will get preferential terms to bridge the gap? The prospectus states that in the event that this minimum amount is not attained, approval may be sought from the Authority to proceed with the listing of the existing shares and any Offer Shares that are subscribed under the Offer.
  
  I got an SMS (as did other Co-op customers) inviting me to take part, but the application desks/tents still look rather forlorn
  
  Equity - HF: November 4 was not just Obama day, but also the date when the Housing Finance and Equity Bank deals should have been completed
  
  Foreign Investors Tough times for the former Rift Valley Railways and Tiomin who continue to flounder: Tiomin’s latest statement notes. …. the Government of Kenya has not completed the remaining bureaucratic steps required for the transaction to close…..Tiomin's management shares our investors' extreme frustration at this unreasonable delay….. Tiomin has acted in good faith and we are very disappointed….. If the closing continues to be delayed, we will consider terminating the MOU on the grounds of unreasonable delay….. Tiomin will issue another press release when further material information is available. Pity they have no local defenders
  
  Geothermal prospects : two companies are scoping in Eburu (gilgil) and Menengai for geothermal energy
  
  Brew turf Coca Cola launch minute maid juices in Kenya (what happens to 5 alive) as EABL launch Alvaro in Uganda
  
  Sat-TV: DSTV will launch pre-paid scratch cards, following in the footsteps of rival GTV who are reaping from the ongoing English premier league
  
  Insurance by M-Pesa: Madison Insurance now accepting insurance installment payments by M-Pesa following Old Mutual, which enabled investment, plan payments
  
  Radio Standard Group prematurely possible radio investment worth Kshs 250 million as KISS FM parent Radio Africa rolls out their 4th radio station – XFM (rock music)
• November 10, 2008
• 0:10

  Share Portfolio November 2008

   » ‎ bankelele

  Tags:  NSE portfolio  

  Last review in August 2008
  
  The Stable
  Diamond Trust ↓
  KCB ↓
  Safaricom ↓
  Scangroup ↓
  Stanbic (Uganda) ↓
  
  Review
  Best performer: Scangroup -8%
  Worst performer Stanbic – 36%, Safaricom -28%
  In: none
  Out: none
  Changes: None - Market down this last three months, no trades made (and no commission generated for stocbroker).
  Performance: Down 12% in the last three months while the NSE Index is down 16%
  Looking forward to: Possibly picking up some Kenya Airways, Kengen, and Safaricom if their shares continue to get cheaper, but sitting out the Co-Op IPO.
• November 05, 2008
• 3:20

  President Obama

   » ‎ bankelele

  Tags:  Obama  

  
  
  Congratulations to Barack Obama the next President of the United States of America. His name has appeared in these pages five times before today:
  
  - April 2005: Congratulations to Wangari Maathai and Barack Obama for making the 2005 Time Magazine Heroes list. However I fear this achievement will be overshadowed be overshadowed by the drama surrounding Presidential wives.
  - August 2007: After Oprah endorsed Obama , I endorsed Jonathan Mueke who was gunning for the Westlands MP seat
  - January 2008: One review of the post-election violence in Kenya found that in the pre-election period, the (Kenyan) opposition may have been falsely buoyed by opinion polls which are not sound (& could the same thing have happened to Obama in New Hampshire?)
  - Also in January 2008 mused that President Obama needs Equity Bank because 46% of African American household’s don’t have bank accounts – and he should borrow Equity Bank’s revolutionary model to bring banking to the unbanked.
  - April 2008: In queing for the Safaricom IPO refers to a Kenyan habit of waiting till the last minute to do things as Obama also took a long time to warp up his party nomination.
  
  Here’s to many more mentions, starting with - US stocks reacted positively on election day, and in the post election victory celebration the Nairobi Stock Exchange(NSE) has also rallied [Top gainers according to stockskenya - National Bank +9.94, CFC +9.91, Kenya Airways +9.91, Sasini +9.83, Diamond Trust +9.79 with no losers yet]
• November 04, 2008
• 23:11

  Co-Operative Bank Listing A to Z

   » ‎ bankelele

  Tags:  Prospectus  

  Almost halfway through the IPO window which runs from October 30 to November 13 2008 at Kshs. 9.50 each. Minimum application amount is 1,000 for retail investors who will get 66% of the floated 701.3 million shares
  
  Basis for listing funds raised will go toward new banking system, new branches, mortgage finance business, card business etc.
  
  Cost of listing The budgeted cost is Kshs. 249 million ($3.1 million) and includes Placement fees 99m Advertising 68m, CMA fees 20m, Printing 17.5m, Lead Sponsoring Stockbrokers fees 8.4m, Public Relations 8.3m, Co-sponsoring Stockbrokers Fees 5.2m, Lead Transaction Adviser 5m, Legal Fees 5m, Receiving Bank fees 3m NSE listing 1.5m and valuation fees of 0.9m. This compares to Equity listing – 28m, Access Kenya 40m, Kenya Re 280m, Kengen IPO 401m, KCB rights 1.1 billion, and the giant Safaricom IPO at 1.1 billion shillings
  
  Expert advice: See also Nairobist and Ratio perspectives on the Co-Op IPO
  
  Float Retail investors will get 463 million shares and qualified Institutions will get 210 million shares, with employees another 28 million shares. The cooperative societies, which will own 62% of the company, are locked in for 5 years, but the existing individual shareholders are free to sell their (680 million) shares.
  
  National Bank of Kenya a joint-receiving Bank for the IPO and the only bank to step forward and offer 100% loans towards the Co-op Bank IPO. Consolidated Bank has just announced that it is also financing.
  
  Numbers Projected EPS is Kshs. 0.66 for 2008 from a profit of 3.45 billion ($43 million), and estimated assets of 87.6 billion [deposits of 66 billion and loans of 51 billion]. the bank has about 800,000 customers, 50,000 CDS accounts, 53 branches and 152ATM’s
  
  Shareholders top shareholders comprise some of the largest savings and credit societies and also top management of the bank. These include Harambee SACCO 3.7%, Teleposta Sacco 2.97%, Afya SACCO 2.94%, Masaku Teachers SACCO 2.90%, Kipsigis Teachers SACCO 2.46% Kenya Police SACCO 2.33%, Gideon Maina Muriuki 2.32 (the Bank MD), Kiambu Unity Finance Co-operative Union Limited 2.27, Nandi Teachers SACCO 1.78%, Aembu FCS Limited 1.77% Mungania Tea Growers SACCO 1.57%. The top 10 individuals are all senior managers and board members (4%)with about 51,000 other shareholders, but there’s no lock-up period for their shares. Equity listed with 2,800 shareholders
  
  Recapitalize a Subsidiary - Co-op consultancy services (-17m reserves) which builds capacity among SACCO’s is also one of the goals from the listing
  
  Subscription: mid week, little traffic and activity among brokers and at various IPO tents around town. Subdued but significant marketing is taking place. Adverts in the newspapers (even the Weekly Citizen tabloid) and on TV
  
  Timing of Listing IPO euphoria for shares has dampened somewhat since the Safaricom IPO and the downward trend of the market right up to the start of the Co-OP IPO
  
  Transaction advisersLead advisers – PKF added to Dyer & Blair, National Bank added as a receiving bank
  
  Valuation beyond setting the basis for the offer price at 9.50, there’s no comparison to peer banks of this size (KCB, Barclays, Equity) which would be expected.
  
  Verdict slight over-subscription expected. barring Safaricom, past IPO’s generally appreciate after listing long enough for speculators to cash out. The shares are much less than the 10 billion from safariom, but having 1 billion shares floating in the market with a large retail pool will have the shares behave like Mumias Sugar shares [Kenya re 9.50 august 2007 for 240m shares]
  Me? bypass for two reasons (i) IPO bypass theory resumes even though a lot of the negatives associated with IPO’s – queues, refunds, hassles seem to be are absent (ii) my portfolio is overweight on financial shares.
• November 03, 2008
• 2:08

  Mark Mobius on Emerging Markets

   » ‎ bankelele

  Tags:  Nairobi Stock Exchange  

  Dr. Mark Mobius, the executive Chairman of Franklin Templeton Investments,is in Nairobi this week. He gave a talk this morning on his investment perspectives. It is especially timely considering the bear market being experience the world over and at the Nairobi Stock Exchange this year.
  
  Some notes
  - They are bargain hunters, they love cheap stocks and thus love bear markets
  - Emerging markets look good for long term investors for several reasons: they are growing faster than developed countries, they have less debt, they have more reserves, inflation is coming down, they are taking up a lager share of world trade and also trading more with each other
  - Bull markets are followed by bear markets which are followed by bull markets then bear......
  - Bull markets last longer than bear markets, and values appreciate more during bear markets than they depreciate during bear markets. he said by their measures over the last 20 years bull markets last on average 22 months and values appreciate by 113% while bear markets on average last 6 months and values depreciate 32%
  - Various FT funds are concentrated in mainly energy stocks, then banks, raw materials, communications etc.
  
  My take: This is a time to buy Nairobi Stock Exchange Shares (NSE) , if you have the money and a long term investment perspective
• October 30, 2008
• 7:12

  EABL 2008 AGM

   » ‎ bankelele

  Tags:  Nairobi Stock Exchange  

  EABL 2008 AGM
• October 29, 2008
• 10:19

  Safaricom 2s

   » ‎ bankelele

  Tags:  Safaricom IPO  

  Safaricom 2s
• October 28, 2008
• 10:20

  Bank Tales II

   » ‎ bankelele

  Tags:  Family Finance  

  Bank Tales II
• October 27, 2008
• 10:05

  Bank Tales

   » ‎ bankelele

  Tags:  Naushad Merali  

  Bank Tales
• October 24, 2008
• 9:45

  Reassurance from bankers

   » ‎ bankelele

  Tags:  Coop  

  Reassurance from bankers
• October 23, 2008
• 7:01

  DiscountStockbrokers.com

   » ‎ bankelele

  Tags:  NSE stockbrokers  

  DiscountStockbrokers.com
• October 21, 2008
• 9:14

  Mostly Centum

   » ‎ bankelele

  Tags:  NSSF Kenya  

  Mostly Centum
• October 17, 2008
• 10:57

  Bank Safety Net

   » ‎ bankelele

  Tags:  shariah banking  

  Bank Safety Net
• 5:50

  Kenya Bank Charges

   » ‎ bankelele

  Tags:  bank charges  

  Kenya Bank Charges
• 5:47

  CBK Profits

   » ‎ bankelele

  Tags:  forex  

  CBK Profits
• October 16, 2008
• 1:56

  Ignore the financial news

   » ‎ bankelele

  Tags:  NSE stockbrokers  

  Ignore the financial news
• October 13, 2008
• 8:29

  NSE: one step back, one step forward

   » ‎ bankelele

  Tags:  Uchumi  

  NSE: one step back, one step forward
• October 09, 2008
• 3:49

  Safaricom 3s

   » ‎ bankelele

  Tags:  Safaricom IPO  

  Safaricom 3s
• October 08, 2008
• 9:41

  Take Crash Positions

   » ‎ bankelele

  Tags:  Nairobi Stock Exchange  

  Take Crash Positions
• October 06, 2008
• 11:07

  Real Estate Moment

   » ‎ bankelele

  Tags:  Nairobi cost of living  

  Real Estate Moment
• October 03, 2008
• 11:50

  Scangroup Sellout Part II

   » ‎ bankelele

  Tags:  NSE investments  

  Scangroup Sellout Part II
• October 02, 2008
• 9:48

  To Coop or Not?

   » ‎ bankelele

  Tags:  Safaricom IPO  

  To Coop or Not?
• September 30, 2008
• 5:08

  Random Photo

   » ‎ bankelele
  Random Photo
• September 29, 2008
• 7:42

  Bad News Bears

   » ‎ bankelele

  Tags:  KPLC  

  Bad News Bears
• 4:54

  $10 hotel room

   » ‎ bankelele

  Tags:  Nairobi cost of living  

  $10 hotel room