Saturday, June 16, 2007

Bank Roundup (June 07)

all banks share capital raised from 250 million to 1 billion. At the beginning of the year, 25 of 43 banks were below this mark (with 7 banks below 500 million). This is an update/reversal of an older proposal to lower the share capital when some banks were struggling a few years ago. Not many mergers expected though it may prompt some mid size banks to go for a public listing to raise cash (only 3 banks lost money last year)

Central bank has advertised for some currency destruction contracts as the east African reports on talks for the government to invest in the current currency supplier DE La Rue

Diamond Trust to venture into Islamic Banking

East African Development Bank profit went up by 229% to $4.6 million – up from $1.4 million the year before. Assets increased to $262m dollars and their non-performing portfolio reduced by 11%

Equity bank won an international award – the 2007 global vision in microfinance award. Also KTN reported that the that the bank will open three women only branches in Nairobi

Two month old Family Bank is seeking a new managing director

KCB to expand into Uganda as it also wins an international award – the Africa investor for best performing stock in Africa award (shares price up 97% ) > but the company also held one of the longest dreariest AGM’s in history on Friday

National bank finally got recapitalized. NBK could receive 346 million in 2007 and 2008, a bullet payment in 2009 of 4.3 billion, 220m in 2010 and 2011 and another bullet payment of 5.2 billion in 2012. For 2013 - 2015 123m each and in 2016 a lump sum of 5.2b. 2017 to 2020 58m each and a final payment of 6 billion – for a total of Kshs. 22.48 billion ($340 million)

NIC to increase authorized share capital via a rights issue. The board approved it on June 14, but there was no mention at the AGM on May 16. This follows a Fitch Report indicating that mid-size Kenyan banks need to increase their capital


East African breweries is accepting applications for a graduate management program. Details online and D/L is 22/6

Family bank: chief executive officer, credit manager. Apply through deloitte - by 29/6

Kenital solar : sales & marketing manager, technical manager, engineer sales executives (5) regional managers (4). Apply to by 22/6

Country manager at Steadman Tanzania . Apply to by 22/6

A dozen IT, research and engineering jobs at Safaricom

Writers at a new Swahili newspaper. Apply to

Project management specialist at USAID.apply to

Rhodes scholarships: 2 for Kenyans to pursue full time post graduate study at the University of Oxford. Apply to by 15/9

Real estate: for the monied in the Diaspora, those who have worked hard and are looking to return in style, consider investing in Kihingo village a gated community development in Kitusuru where prices start at $500,000.


David Mugo said...

I am greatful and amazed at what Kenyans are doing on the web, especially the bloggers and more so, bankelele and kenyanpundit. I am trying to popularize blogging among Kenyans at home and i have launched a multiblog platform for Kenyans at This will guarantee Kenyan readership and contribution to the growing internet industry and media in Kenya.

kenyaonly said...

Great article, I wonder whether other banks will follow suit in Islamic banking. Kenya has lots of islamic businessman and its believed they put their money at home. Hope this will be successful and will be an added advantage to the already developing banking industry. As for equity, is "all women bank" really needed?

Anonymous said...

Can you help me calculate how NBK will earn those amounts each year.


coldtusker said...

How did NBK account for the income in the past...

If the govt loans were not part of the "Non-performing loans " there is little impact on the Balance Sheet.

As far as the interest income is concerned... if the loans were not classified as "Bad" or "Non-performing" then the interest income (at 15%) was counted in the P&L...

So there were paper profits not cash BUT... that means NBK will have lower profits from this lending compared to prior years!

Good news is that NBK can get to collecting on the real bad debts owed by politicians!

MainaT said...

CT-tx. Finally somebody else is asking the question I have been asking. They are saying that this 20bn is part of their 33bn npl. So that will help. The crucial question is the P&L treatment because if they (as I suspect), have accrued the interest on these npls, they can't then get another lift from this same when the GoK pays the interest.
The remaining 13bn will be nploans that they'll have a for a while-remember Nyachae's list?

coldtusker said...

Mainat - Somehow... I do not think the 20bn were part of the NPLs... Let me look into that!

If the 20bn was part of the NPLs then the interest income should NOT be part of the P&L...

If the above is what they did then NBK benefits... but only IF...

chumviKiasi said...

Check out on my blog a post on the middle class home buying boom in Kenya as a counter to kihingovillage-not too sure about that name.

bankelele said...

David Mugo: Keep up with

kenyaonly: Barclays and KCB the two largest have already ventured there in the last year. Don't know about a separate banking hall, but many women face additional barriers to accessing finance

coldtusker: They have reported income and their auditors have passed the books (for many years), based on the assurance that the government would compnesate NBK for the "government initiated advances" - and this =has finaly happened.

MainaT: I think the 20b is debt owed by other government bodies, and therefore not the entire bad book

chumviKiasi: some people have money to spend, more than they know what to do with. There are also many wealthy expatriates moving & settling in Kenya - who desire the gated millionaire housing lifestyle


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