The CFC Stanbic Holdings annual general meeting (AGM) for 2010 was held on May 21 at the tented parking at CFC Centre, off Museum Hill, Nairobi. (twitter @Standardbankgrp)
The Managing Director re-capped the year’s performance of the group companies. CFC Stanbic (bank) had a flat profit of 1.9 billion [$25 million], CFC financial services (stockbroker) lost 108 million [-$1.4m], CFC Life (insurance) lost 433 million [-$5.6m] while Heritage (insurance) had a profit of 278 million [$3.6m]. He attributed the performance to impairment of the stock portfolio at the Nairobi stock exchange which declined by 60%, increased operating costs (New IT system, write-off old IT system, opening of new branches, and refurbishing/rebranding of all other branches) overall operating income was up 25% in 2009, but operating costs went up 46%. Finally, he added that the first quarter of 2010 has seen a good performance – with good earnings from forex and government securities, and the NSE rebound has good for their portfolio this year
Hot Button Issue: Poor performance of the Group /companies was cause for concern among several shareholders who asked questions citing:
- High operating expenses of 6 billion
- Item of ‘other expenses ‘ totaling 3.4 billion ($45 million) that were not detailed in the notes
-Ill-feeling, that when they approved the CFC Stanbic merger they were told that the group would have a leaner management structure would lead to cost savings across the group, and this has not happened
- Company used to be generous & give bonuses, but looking at the results, this is not going to happen any time soon!
In reply, the Board referred back to the MD’s earlier statement that had broken down the major cost items as well as the decline in the company’s NSE portfolio that had resulted in their auditors asking that they factor in an impairment provision of about 700 million while the others were the IT costs, advertising/branding branch refurbishment across the group, not just bank business.
Why new borrowing?: a corporate bond of 2.5 billion [$32.5m]was asked about. Notes also show increase loan from IFC of 759 million and new loans from other banks - NIC (200m) and CBA (500m). MD said the bond and loans were to support their mortgage business, which has been one of their better performing lines, and also support their subordinate capital position. .
(500m)
Banking sector fraud is high even as the group invests in new system and new products like electronic banking, there is a lot of fraud in the sector with customers losing their money to bank insider, and are Kenyan laws keeping up with new fraudsters. MD replied that the new system was safer.
Long-serving Chairman Exits: During director elections, the chairman Charles Njonjo announced that Mike Du Toit (long time Stanbic K MD), Titus Naikuni (MD of Kenya Airways) and himself who were all up for re-election were all stepping down, but added that Du Toit would take up other responsibilities within the group. On his part he thanked shareholders for their support though the years and said he was proud that the company that he, Jeremiah Kiereini (fellow powerful director), and PK Jani had started many years ago had grown into a conglomerate which now had undergone many recent changes and there were many new faces (and more women) who did not know his face, He said Kiereini , who will remain on the board for a few more years, would look after his interests but that he would still be around next year, as a shareholder on the floor, to ask questions of the board. Re-elected directors were Eddy Njoroge (Kengen MD), Fred Ojiambo (Nairobi lawyer), Jane Babsa-Nzibo and Greg Brackenridge who will be the new Bank CEO?
Bonus at next meeting: an extraordinary general meeting of shareholders will be called later in the year to approve the hiving off of the insurance business (CFC Life and Heritage) into a new company (in a deal with Liberty Holdings & African Liaissons Consultants)that will also be listed on the Nairobi Stock Exchange. Current CFCStanbic shareholders will receive a dividend in specie of 1 share of the new company for every 1 CFC share they currently hold, at no additional cost.
Goodies: - lunch box (flat rice & chicken piece), soda, umbrella (which I lost an hour later)
- scary? annual report was 114 pages long without as ingle picture or CSR fluff page. Shareholders also, after several questions, approved a motion allowing the company to publish account sin the newspapers, have it on their website or e-mail it to shareholders in lieu of having to print and mail one to every shareholder.
Showing posts with label CFC. Show all posts
Showing posts with label CFC. Show all posts
Monday, May 24, 2010
CFC Stanbic 2010 AGM
Thursday, August 28, 2008
Online Nairobi Stockbrokers
Continuing the popular Where to buy shares series, my long-time stockbroker CFC (actually CFCFS) have finally unveiled an online trading and account/portfolio platform. It’s quite good so far, quick registration, easy navigation, and hopefully a secure one. I hope they add share reports, and other useful tips which they can e-mail to users.
My portfolio is correctly displayed and I will make my next trades online (previously I used to e-mail my orders, and get confirmations and statements back by e-mail)
Other brokers with online features (can’t vouch for their quality) include Afrika Discount Drummond Dyer & Blair, Faida and Sterling
Questions
1. What are you online experiences like with your Kenyan stockbrokers?
2. Have any Kenyans in the Diaspora got their Safaricom IPO refunds, or been able to apply them to buy other shares? Have you seen your refund cheques, or know where they are?
My portfolio is correctly displayed and I will make my next trades online (previously I used to e-mail my orders, and get confirmations and statements back by e-mail)
Other brokers with online features (can’t vouch for their quality) include Afrika Discount Drummond Dyer & Blair, Faida and Sterling
Questions
1. What are you online experiences like with your Kenyan stockbrokers?
2. Have any Kenyans in the Diaspora got their Safaricom IPO refunds, or been able to apply them to buy other shares? Have you seen your refund cheques, or know where they are?
Wednesday, June 25, 2008
Kenya Insurance 2007 Rankings
Insurance Company of East Africa Assets 19,151 million [19.15 billion or ~ $309 million] (profit of 545 million) [$8.8 million]
Kenya Reinsurance 14,710 (965 million)
Jubilee Insurance 12,459
British American Insurance 10,252 (512)
Kenindia Assurance 9,886
UAP Insurance 7,245 (888)
Old Mutual Life Assurance 6,447
CFC life -- (255 million profit)
Heritage AII 4,522 (364)
APA Insurance 4,491
Lion of Kenya Insurance 3,722 (179)
Phoenix (East Africa) Assurance 3,669 (103)
Blue Shield 3,109
Kenya Alliance 2,798
Madison Insurance 2,751
Cooperative Insurance 2,437 (140)
AIG Kenya Insurance 2,337 (217)
General Accident Insurance 2,192 (216)
Cannon Assurance 2,163 (60)
First Africa Assurance 1,781 (103)
Apollo Insurance 1,774
Geminia Insurance 1,223 (24)
Fidelity Shield 1,194 (98)
Trident Insurance 1,178 (54)
Real Insurance 1,107 (92)
Gateway Insurance 1,058
Tausi Assurance 949 (2)
Occidental Insurance 937 (63)
Mercantile Insurance 910 (34)
Standard Assurance 896 (6)
East Africa Re 872 (119)
Intra Africa Assurance 855
Corporate Insurance 809 (23)
Concord Insurance 757 (28)
Directline Assurance 730
Monarch Insurance 683 (9)
Amaco 674 (43)
Pioneer Assurance 508 (4)
Mayfair insurance 478 (-1)
Kenya Orient 443 (19)
Metropolitan Insurance 437
PACIS 220 (27)
Trinity Life Assurance 219
Kenya Reinsurance 14,710 (965 million)
Jubilee Insurance 12,459
British American Insurance 10,252 (512)
Kenindia Assurance 9,886
UAP Insurance 7,245 (888)
Old Mutual Life Assurance 6,447
CFC life -- (255 million profit)
Heritage AII 4,522 (364)
APA Insurance 4,491
Lion of Kenya Insurance 3,722 (179)
Phoenix (East Africa) Assurance 3,669 (103)
Blue Shield 3,109
Kenya Alliance 2,798
Madison Insurance 2,751
Cooperative Insurance 2,437 (140)
AIG Kenya Insurance 2,337 (217)
General Accident Insurance 2,192 (216)
Cannon Assurance 2,163 (60)
First Africa Assurance 1,781 (103)
Apollo Insurance 1,774
Geminia Insurance 1,223 (24)
Fidelity Shield 1,194 (98)
Trident Insurance 1,178 (54)
Real Insurance 1,107 (92)
Gateway Insurance 1,058
Tausi Assurance 949 (2)
Occidental Insurance 937 (63)
Mercantile Insurance 910 (34)
Standard Assurance 896 (6)
East Africa Re 872 (119)
Intra Africa Assurance 855
Corporate Insurance 809 (23)
Concord Insurance 757 (28)
Directline Assurance 730
Monarch Insurance 683 (9)
Amaco 674 (43)
Pioneer Assurance 508 (4)
Mayfair insurance 478 (-1)
Kenya Orient 443 (19)
Metropolitan Insurance 437
PACIS 220 (27)
Trinity Life Assurance 219
Wednesday, June 18, 2008
Kutwa Tuesday - June 18
yes it's Wednesday, but these relate to recent events
2008 Budget
- While the ICT sector was celebrating, a 25% tax on imported used computers was added on
- Wireless providers also pay a 10% tax, same as mobile companies (putting Telkom wireless on par with Safaricom and Celtel)
- Whistle blower on tax evasion may be entitled to 3% or 5% tax recovered by KRA. (but too late for David Munyakei)
- And from Tanzania; a brilliant idea that sounded dumb initially – at tax on loss making companies; It's an alternative minimum tax for companies that report tax losses for three consecutive years - and will now amount to of 0.3% of their turnover. This is targeted at companies with high turnover that engage in tax avoidance could KRA adopt that later?
CFC Stanbic: In the CFC-Stanbic merger/takeover, shareholders voiced concerns that some CFC shareholders were getting paid and walking away from the company with cash. Now three of them - Gambit, Trogon, and Jani are voluntarily winding up
IPO refunds: The Central Bank is concerned about the slow pace of Safaricom refunds (statement (PDF))
- Yet there was there option in the initial prospectus for applicants to be refunded by M-pesa; which would have been ideal for thousands of minimum applicants [who are getting refunds of about 7,900 shillings or $127]
- The CBK statement mentions that you can send a message to confirm the status of your refund e.g. "CDS#ID#R" to 4009. (my message told me my cheque which I collected last week, was ready at the broker). What it doesn’t tell you is that the message costs 15 shillings or ~ 2 Safaricom shares at the going rate
2008 Budget
- While the ICT sector was celebrating, a 25% tax on imported used computers was added on
- Wireless providers also pay a 10% tax, same as mobile companies (putting Telkom wireless on par with Safaricom and Celtel)
- Whistle blower on tax evasion may be entitled to 3% or 5% tax recovered by KRA. (but too late for David Munyakei)
- And from Tanzania; a brilliant idea that sounded dumb initially – at tax on loss making companies; It's an alternative minimum tax for companies that report tax losses for three consecutive years - and will now amount to of 0.3% of their turnover. This is targeted at companies with high turnover that engage in tax avoidance could KRA adopt that later?
CFC Stanbic: In the CFC-Stanbic merger/takeover, shareholders voiced concerns that some CFC shareholders were getting paid and walking away from the company with cash. Now three of them - Gambit, Trogon, and Jani are voluntarily winding up
IPO refunds: The Central Bank is concerned about the slow pace of Safaricom refunds (statement (PDF))
- Yet there was there option in the initial prospectus for applicants to be refunded by M-pesa; which would have been ideal for thousands of minimum applicants [who are getting refunds of about 7,900 shillings or $127]
- The CBK statement mentions that you can send a message to confirm the status of your refund e.g. "CDS#ID#R" to 4009. (my message told me my cheque which I collected last week, was ready at the broker). What it doesn’t tell you is that the message costs 15 shillings or ~ 2 Safaricom shares at the going rate
Tuesday, January 15, 2008
Kutwa Tuesday: Banking Brief's (Jan 15)
CFC on hold?
Could the ongoing political crisis be giving Standard Bank of South Africa second thoughts about its approved merger with CFC? A decision by the Reserve Bank in SA to conclude the deal is also overdue.
Dangers of insular banking
Our banking history is littered with the remains of Daima Bank and other indigenous African and Asian banks. Most went down due to malpractices by directors and managers, but also in-lending to close circle or community companies who as a group could be potentially exposed to a singular risk.
The banks also engaged in subtle discriminatory practices like charging outsiders higher rates, frustrating their loan applications or facilities, or making them feel unwelcome - which ultimately proved to be counter productive as locking them out increased the risks that the banks faced by increasing their exposure and dependence on a core group or sector.
Could the ongoing political crisis be giving Standard Bank of South Africa second thoughts about its approved merger with CFC? A decision by the Reserve Bank in SA to conclude the deal is also overdue.
Dangers of insular banking
Our banking history is littered with the remains of Daima Bank and other indigenous African and Asian banks. Most went down due to malpractices by directors and managers, but also in-lending to close circle or community companies who as a group could be potentially exposed to a singular risk.
The banks also engaged in subtle discriminatory practices like charging outsiders higher rates, frustrating their loan applications or facilities, or making them feel unwelcome - which ultimately proved to be counter productive as locking them out increased the risks that the banks faced by increasing their exposure and dependence on a core group or sector.
Monday, December 24, 2007
Bank Review '07: Part IV
Finally the big leagues - these banks have large networks of branches and ATM’s in most of the major towns around the country.
6. (No. 13 last year) Equity Bank: Estimated assets of 51 billion ($730 million) and profit of 2.1 billion shillings ($30 million) as Equity continues the staggering 100% annual growth rate it has maintained since it converted from a building society. Took some political and banking industry heat, but was ably defended by authorities and management. The bank also bought out ¼ of Housing Finance and sold 25% a stake to Helios Capital to 11 billion shillings. The Helios deal will be used to finance Equity’s expansion into East & Central Africa as well as the payment to Housing Finance – and with the addition of new directors, Equity needs to sort out some governance and staff morale issues in the new year.
5. (9 and 10 respectivly) CFC Stanbic Bank: Estimated combined bank assets of 64 billion and profits of 2.2 billion resulting from the mega-merger of two mid-size banks – the local arm of Stanbic (Africa’s largest bank) and mid-size CFC with a combined corporate, insurance and stockbroking business. Some clash of cultures and systems can be expected as with most mergers, but this could be a South African - Kenyan partnership that succeeds, where many others have failed.
4. (4) Cooperative Bank: Estimated assets of 70 billion, profits of 2.5 billion in 2007. Another record year for the bank that has recovered massively from a loss five years ago and since the government set out to sort of the cooperatives sector debts. With growth of 15% from a year ago, and profit up 100%, though the MD was rumored to have been keen to move to KCB.
3. (3) Standard Chartered: Estimated assets of 100 billion and profits of 3.5 billion. The quietest of the big three banks in terms of product development & marketing, it lost ground to KCB even as it remains second in market cap. Hawking their products on street corners may have hurt their image, while the corporate banking is plagued by high fees and an operational system difficult to maneuver.
2. (2) KCB: Estimated assets of 110 billion and profits of 4.3 billion in 2007. Had a smooth CEO transition and growth of 20% but with both deposits and loans up 30% from a year ago. But into S. Sudan has been slow, while Uganda was also delayed, showing the difficult of regional banking.
1. (1) Barclays Kenya: Estimated assets of 160 billion ($2.3 billion), profits of 8.5 billion ($120 million) with growth of 25% from a year ago. The bank continued its turnaround, expanding in rural Kenya and other parts of Africa where it had previously withdrawn and closed branches. This is not the first time that it has had to reverse direction – years ago they spun off an unwanted asset finance business that is now NIC Bank – and who they are fighting for dominance of the same market.
who’s missing?
- Charterhouse Bank which is under statutory management by the Central Bank
- Gulf African – new Shariah bank began in 2007, but may be operating under different rules – (see post)
- Kenya Women’s Finance Trust a micro finance organization with assets of about 4 billion and profit of about 200 million that may be the next bank licensed in 2008.
6. (No. 13 last year) Equity Bank: Estimated assets of 51 billion ($730 million) and profit of 2.1 billion shillings ($30 million) as Equity continues the staggering 100% annual growth rate it has maintained since it converted from a building society. Took some political and banking industry heat, but was ably defended by authorities and management. The bank also bought out ¼ of Housing Finance and sold 25% a stake to Helios Capital to 11 billion shillings. The Helios deal will be used to finance Equity’s expansion into East & Central Africa as well as the payment to Housing Finance – and with the addition of new directors, Equity needs to sort out some governance and staff morale issues in the new year.
5. (9 and 10 respectivly) CFC Stanbic Bank: Estimated combined bank assets of 64 billion and profits of 2.2 billion resulting from the mega-merger of two mid-size banks – the local arm of Stanbic (Africa’s largest bank) and mid-size CFC with a combined corporate, insurance and stockbroking business. Some clash of cultures and systems can be expected as with most mergers, but this could be a South African - Kenyan partnership that succeeds, where many others have failed.
4. (4) Cooperative Bank: Estimated assets of 70 billion, profits of 2.5 billion in 2007. Another record year for the bank that has recovered massively from a loss five years ago and since the government set out to sort of the cooperatives sector debts. With growth of 15% from a year ago, and profit up 100%, though the MD was rumored to have been keen to move to KCB.
3. (3) Standard Chartered: Estimated assets of 100 billion and profits of 3.5 billion. The quietest of the big three banks in terms of product development & marketing, it lost ground to KCB even as it remains second in market cap. Hawking their products on street corners may have hurt their image, while the corporate banking is plagued by high fees and an operational system difficult to maneuver.
2. (2) KCB: Estimated assets of 110 billion and profits of 4.3 billion in 2007. Had a smooth CEO transition and growth of 20% but with both deposits and loans up 30% from a year ago. But into S. Sudan has been slow, while Uganda was also delayed, showing the difficult of regional banking.
1. (1) Barclays Kenya: Estimated assets of 160 billion ($2.3 billion), profits of 8.5 billion ($120 million) with growth of 25% from a year ago. The bank continued its turnaround, expanding in rural Kenya and other parts of Africa where it had previously withdrawn and closed branches. This is not the first time that it has had to reverse direction – years ago they spun off an unwanted asset finance business that is now NIC Bank – and who they are fighting for dominance of the same market.
who’s missing?
- Charterhouse Bank which is under statutory management by the Central Bank
- Gulf African – new Shariah bank began in 2007, but may be operating under different rules – (see post)
- Kenya Women’s Finance Trust a micro finance organization with assets of about 4 billion and profit of about 200 million that may be the next bank licensed in 2008.
Monday, November 12, 2007
CFC-Stanbic Bank EGM: merger approved
An extraordinary general meeting to approve the CFC – Stanbic merger was held on November 12 at the Intercontinental Hotel
Deal: Stanbic is the largest bank in Africa with a presence in 18 Africa countries and 21 others around the world (including Bank of America in Argentina which they just bought). It has asset of $140 billion and 43,000 employees – and by combining their (relatively) small Kenyan operation with CFC, they will become the 4th largest bank in Kenya.
Approval got: CMA, CBK, monopolies commission
Approval to be got: shareholders, SA reserve bank, NSE
Deal should be complete in about a month
The meeting was led by CFC Chairman Charles Njonjo. Fellow director J. Kierini introduced the board and, other dignitaries present who including D. Ndonye (Deloitte), Jimnah Mbaru, Kaplan & Stratton advisers, and Craig Bond and a team from Stanbic include his son who works at Stanbic Kenya.
CFC MD Soundararajan explained rationale for the merger - synergies, very similar and complementary customers, regional opportunities, and enhanced capital adequacy. Customers will get a one stop shop for all their business, staff get to work in a bigger bank with more careers opportunities (and all employees are assured of retaining their jobs).
Shareholder questions
Dilution of minority shareholding? : Management said they are getting into a bigger entity
Are major shareholders bailing? : Gambit will get paid in new shares but also about 5.8 billion shillings. MD answered that shareholders are staying and the company is not going anywhere
Mgmt. afraid to say that CFC being ; Management says it’s a merger, as it is not a sale, new entity will have 40% CFC and 60% Stanbic shareholders
if CFC is growing well, why sell? Need for capital is important. MD said that he needs about $100 million, while new entity will have around $60 – 70 million. Merger will enhance the company’s growth plans
Due diligence on Stanbic? ; Done and they shared strategies which each other to see if they were on the same path. Also board member (and lawyer) Fred Ojiambo denied that a 25 billion shilling lawsuit had eroded the value of Stanbic (K) saying that claim had no firm base
Why no bonus shares instead of selling out?: MD said CFC had in the past given the largest bonus divided in the history of NSE 21 for 1 and the board will consider that at the right time
This is it: The historic moment passed in a flash as the Chairman proposed that all six resolutions be passed in a single vote since they were all interdependent.
The resolutions passed in a single vote;
- Created 117 million new shares to accommodate Stanbic
- Empowered the directors to allot shares to Stanbic
- Changed the name of the company to CFC Stanbic Holdings
- Transferred the bank business (assets, liabilities, employees, creditors etc.) to Stanbic
- Amended the new articles of association
- Changed the business of the company from a bank to holding company
Now CFC Stanbic holding co to remain listed on the NSE while CFC Stanbic Bank will be a 100% owned subsidiary
Other speakers
Craig Bond: The Head of Stanbic Africa, said they got lucky in Kenya as the first bank they identified turned out to be the right partner offering great synergies; in Nigeria they have looked at 6 banks which have not panned out. He said that Stanbic which intends to be the ‘best emerging markets bank’ in the world had identified 3 countries that they intended to dominate in Africa – SA, Nigeria and Kenya where they intend to break into the top 2 (not remain #4), by rapidly expand branches in 2008
Commenting on the largest bank in the world ICBC buying 20% of Stanbic (it’s 70% owned by government of china) - he said China is coming to Africa in a big way for her resources, and it offered Stanbic cheap money with the promise to match them $ for $ in any investment in Africa
NSE Chairman Jimnah Mbaru said he was proud that the deal happened under his watch and confirmed that he expected NSE to approve the deal by end of the week. He looked forward to having a big institution with the capital to enable economy to meet growth goals in terms of resources. And finally called out to family owned companies to see what could happen if they transform themselves into institutions as the late Mr. Jani had done with his firm which was now merging with Stanbic.
There were further tributes to the late Mr. Jani who created the company in 1951 with a vision for into to partner with an international power house, MD Soundararajan and directors Njonjo and Kierieni for making the deal happen
Humorous moment: Chairman Charles Njonjo was sad that there were only ‘5’ shareholders present when the meeting started, but got happy as the numbers had reached about 100 by the time it ended. However it didn’t really matter as he had 45% proxies from Africa Liaison and Gambit while fellow director Kierieni had 30%.
Goodies: souvenir pen, umbrella, big lunch box with little food from intercontinental – (fanta, cake, apple, and bit of goat, chicken and sausage)
other news
Barclays launched tranche one of its bond - 1 billion shillings, maturing in November 2014.
Rwanda and Burundi to join the East Africa Development Bank once they subscribed via share capital
Equity Bank extends banking hours to almost match office hours; 8 a.m. – 4:30 p.m. on weekdays and 8 a.m. – Noon on Saturday
The National Housing Corporation is offering investors loans to build rural and peri-urban homes. The maximum loan amount is only 1.5 million shillings – and it’s advanced at 13% over up to 10 years
Sasanet investors want to notify partners, bankers, and other companies (including safaricom) that the company had not refunded investors their funds.
Urban transport gets more expensive as all the major transporters Citi hoppa, KBS and matatu owners start a blanket 10 shilling per ride fare hike to counter rising fuel prices
opportunities
Celtel territory sales executives (17). D/l is 16/11
IT manager at EA Cables. apply thru deloitte esd@deloitte.co.ke
Jamii telecommunications: account managers (3). d/l is 16/11
KBR various jobs in Iraq, Afghanistan pr Kuwait. But …
Madison: finance manager, senior investments manager
Microsoft: public sector lead account manager - public sector & education solution sales professional (business productivity), infrastructure consultant, MBA graduate
Head of ICT services - Standard Group. d/l is 13/11
Chief operating officer at Renaissance capital. apply to coo@rencap.com by 19/11
Deal: Stanbic is the largest bank in Africa with a presence in 18 Africa countries and 21 others around the world (including Bank of America in Argentina which they just bought). It has asset of $140 billion and 43,000 employees – and by combining their (relatively) small Kenyan operation with CFC, they will become the 4th largest bank in Kenya.
Approval got: CMA, CBK, monopolies commission
Approval to be got: shareholders, SA reserve bank, NSE
Deal should be complete in about a month
The meeting was led by CFC Chairman Charles Njonjo. Fellow director J. Kierini introduced the board and, other dignitaries present who including D. Ndonye (Deloitte), Jimnah Mbaru, Kaplan & Stratton advisers, and Craig Bond and a team from Stanbic include his son who works at Stanbic Kenya.
CFC MD Soundararajan explained rationale for the merger - synergies, very similar and complementary customers, regional opportunities, and enhanced capital adequacy. Customers will get a one stop shop for all their business, staff get to work in a bigger bank with more careers opportunities (and all employees are assured of retaining their jobs).
Shareholder questions
Dilution of minority shareholding? : Management said they are getting into a bigger entity
Are major shareholders bailing? : Gambit will get paid in new shares but also about 5.8 billion shillings. MD answered that shareholders are staying and the company is not going anywhere
Mgmt. afraid to say that CFC being ; Management says it’s a merger, as it is not a sale, new entity will have 40% CFC and 60% Stanbic shareholders
if CFC is growing well, why sell? Need for capital is important. MD said that he needs about $100 million, while new entity will have around $60 – 70 million. Merger will enhance the company’s growth plans
Due diligence on Stanbic? ; Done and they shared strategies which each other to see if they were on the same path. Also board member (and lawyer) Fred Ojiambo denied that a 25 billion shilling lawsuit had eroded the value of Stanbic (K) saying that claim had no firm base
Why no bonus shares instead of selling out?: MD said CFC had in the past given the largest bonus divided in the history of NSE 21 for 1 and the board will consider that at the right time
This is it: The historic moment passed in a flash as the Chairman proposed that all six resolutions be passed in a single vote since they were all interdependent.
The resolutions passed in a single vote;
- Created 117 million new shares to accommodate Stanbic
- Empowered the directors to allot shares to Stanbic
- Changed the name of the company to CFC Stanbic Holdings
- Transferred the bank business (assets, liabilities, employees, creditors etc.) to Stanbic
- Amended the new articles of association
- Changed the business of the company from a bank to holding company
Now CFC Stanbic holding co to remain listed on the NSE while CFC Stanbic Bank will be a 100% owned subsidiary
Other speakers
Craig Bond: The Head of Stanbic Africa, said they got lucky in Kenya as the first bank they identified turned out to be the right partner offering great synergies; in Nigeria they have looked at 6 banks which have not panned out. He said that Stanbic which intends to be the ‘best emerging markets bank’ in the world had identified 3 countries that they intended to dominate in Africa – SA, Nigeria and Kenya where they intend to break into the top 2 (not remain #4), by rapidly expand branches in 2008
Commenting on the largest bank in the world ICBC buying 20% of Stanbic (it’s 70% owned by government of china) - he said China is coming to Africa in a big way for her resources, and it offered Stanbic cheap money with the promise to match them $ for $ in any investment in Africa
NSE Chairman Jimnah Mbaru said he was proud that the deal happened under his watch and confirmed that he expected NSE to approve the deal by end of the week. He looked forward to having a big institution with the capital to enable economy to meet growth goals in terms of resources. And finally called out to family owned companies to see what could happen if they transform themselves into institutions as the late Mr. Jani had done with his firm which was now merging with Stanbic.
There were further tributes to the late Mr. Jani who created the company in 1951 with a vision for into to partner with an international power house, MD Soundararajan and directors Njonjo and Kierieni for making the deal happen
Humorous moment: Chairman Charles Njonjo was sad that there were only ‘5’ shareholders present when the meeting started, but got happy as the numbers had reached about 100 by the time it ended. However it didn’t really matter as he had 45% proxies from Africa Liaison and Gambit while fellow director Kierieni had 30%.
Goodies: souvenir pen, umbrella, big lunch box with little food from intercontinental – (fanta, cake, apple, and bit of goat, chicken and sausage)
other news
Barclays launched tranche one of its bond - 1 billion shillings, maturing in November 2014.
Rwanda and Burundi to join the East Africa Development Bank once they subscribed via share capital
Equity Bank extends banking hours to almost match office hours; 8 a.m. – 4:30 p.m. on weekdays and 8 a.m. – Noon on Saturday
The National Housing Corporation is offering investors loans to build rural and peri-urban homes. The maximum loan amount is only 1.5 million shillings – and it’s advanced at 13% over up to 10 years
Sasanet investors want to notify partners, bankers, and other companies (including safaricom) that the company had not refunded investors their funds.
Urban transport gets more expensive as all the major transporters Citi hoppa, KBS and matatu owners start a blanket 10 shilling per ride fare hike to counter rising fuel prices
opportunities
Celtel territory sales executives (17). D/l is 16/11
IT manager at EA Cables. apply thru deloitte esd@deloitte.co.ke
Jamii telecommunications: account managers (3). d/l is 16/11
KBR various jobs in Iraq, Afghanistan pr Kuwait. But …
Madison: finance manager, senior investments manager
Microsoft: public sector lead account manager - public sector & education solution sales professional (business productivity), infrastructure consultant, MBA graduate
Head of ICT services - Standard Group. d/l is 13/11
Chief operating officer at Renaissance capital. apply to coo@rencap.com by 19/11
Monday, November 05, 2007
Bank Wars
Equity vs. Barclays
Equity Bank is often cited as being what caused banks, especially Barclays Bank to change their focus. But is it true, or is Barclays expanding all over Africa not just Kenya, in terms of opening new branches and expanding into the retail sector.
political muscle: A recent editorial strongly defended Equity and it has also received strong defense from Government ministers whenever allegations have been thrown against the bank.
Equity has also not been shy in employing political muscle themselves. The delayed conversion of rival building society into Family Bank has been linked to Equity's influence and the bank was also instrumental suffocating pyramid schemes who grew to rival banks for deposits while ironically relying on banks for their massive fund transfers to/from investors.
Equity in 2008: Even if 2008 brings in a new government, Equity Bank should be ok. While the current government has been kind to Equity, giving it the space and access to market, environment to expand, Equity has been smart to use their access to Government to grow, without necessarily going to bed with the government. I.e. targeting government and parastatal deposits and banking business. Equity has expanded nationwide and has customers throughout the country and a positive image as a mwananchi bank. Think Kenol, not Mugoya for Equity next year, if the election follows the current polls
other banking briefs
Barclays bond: Barclays Kenya will issue a $75 million bond over 7 years.
Seem receptive, though their last bond to finance a mortgage business was scuttled by former finance minister who asked that the bank invest new money into Kenya, not borrow from the local market. That should whet the appetite for corporate investors who may be put off by the anticipated over-subscription (wasted funds, lost opportunity, delayed refunds) of a Safaricom IPO
But is Barclays parent in trouble? The global financial crisis has also taken done in the Citi (bank) CEO
Merger slows It's a shame that the CFC-Stanbic merger can be jeopardized by a frivolous lawsuit frivolous lawsuit. How does a 50 million shilling dispute balloon into a 25 billion shilling lawsuit for damages?
City Finance is expected to be taken over by new owners. Kenya's smallest bank should get a boost from new owners - as it is the only loss making bank so far this year. As at June this year, it had assets of just 510 million shillings ($7.7 million) in assets, deposits of of 131m, and loans 218m.
Collapsed banks update: Capital Finance and Pioneer Building Society are to be wound up while customers of Daima Bank will be paid another dividend
Bad loan relief?: The interest rates advisory centre offers loan and mortgage interest recalculation, financial cost assurance (overdraft, loan interest), in-duplum interest recalculation for the period (1/1/2001 to 31/7/2005) and informs its clients that that all bank charges from 1/11/89 may be illegal!
Though IRAC won against Housing Finance, bad debt relief may be a pipe dream for most, except for a few instances
Other corporate news
Keroche going into beer production after huge bill handed to them of unpaid taxes. This is the last thing that Kenya Breweries wanted to hear
The Minister for Finance has approve the takeover of Kobil Petroleum by sister company Kenya Oil Company Limited (Kenol). But Kobil is/was a Delaware corporation?
Fake sugar: Strange saga of a ship which arrived at Mombasa with contraband sugar already packaged in Mumias sugar bags – ready to go to store shelves. Packing sugar in their 'produced in Kenya' branded bags has been a key branding initiative by Mumias to differentiate it from imported sugar and seems to have worked, but counterfeiters can only be kept at bay for so long
Wananchi TV: convergence as Kenya's largest ISP wananchi is going into partnership with GTV to begin high speed cable and satellite TV all in one package.
Also mobile TV on phones : a few months ago, the bosses of Kenya Broadcasting Corporation were on TV from a golf tournaments talking about their plans for the rest of the year which included launching a new radio station and also coming up with the first news broadcast via mobile phones by September. (Read on - KBC is a shareholder in the local multichoice Kenya)
Opportunities
- A new Equity Fund in Kenya urgently looking for a financial systems engineer with banking experience. Apply to ndeman2@yahoo.com
- Apprentice to Africa. The Apprentice Challenge comes to Africa – with $200,000 in prize money
Equity Bank is often cited as being what caused banks, especially Barclays Bank to change their focus. But is it true, or is Barclays expanding all over Africa not just Kenya, in terms of opening new branches and expanding into the retail sector.
political muscle: A recent editorial strongly defended Equity and it has also received strong defense from Government ministers whenever allegations have been thrown against the bank.
Equity has also not been shy in employing political muscle themselves. The delayed conversion of rival building society into Family Bank has been linked to Equity's influence and the bank was also instrumental suffocating pyramid schemes who grew to rival banks for deposits while ironically relying on banks for their massive fund transfers to/from investors.
Equity in 2008: Even if 2008 brings in a new government, Equity Bank should be ok. While the current government has been kind to Equity, giving it the space and access to market, environment to expand, Equity has been smart to use their access to Government to grow, without necessarily going to bed with the government. I.e. targeting government and parastatal deposits and banking business. Equity has expanded nationwide and has customers throughout the country and a positive image as a mwananchi bank. Think Kenol, not Mugoya for Equity next year, if the election follows the current polls
other banking briefs
Barclays bond: Barclays Kenya will issue a $75 million bond over 7 years.
Seem receptive, though their last bond to finance a mortgage business was scuttled by former finance minister who asked that the bank invest new money into Kenya, not borrow from the local market. That should whet the appetite for corporate investors who may be put off by the anticipated over-subscription (wasted funds, lost opportunity, delayed refunds) of a Safaricom IPO
But is Barclays parent in trouble? The global financial crisis has also taken done in the Citi (bank) CEO
Merger slows It's a shame that the CFC-Stanbic merger can be jeopardized by a frivolous lawsuit frivolous lawsuit. How does a 50 million shilling dispute balloon into a 25 billion shilling lawsuit for damages?
City Finance is expected to be taken over by new owners. Kenya's smallest bank should get a boost from new owners - as it is the only loss making bank so far this year. As at June this year, it had assets of just 510 million shillings ($7.7 million) in assets, deposits of of 131m, and loans 218m.
Collapsed banks update: Capital Finance and Pioneer Building Society are to be wound up while customers of Daima Bank will be paid another dividend
Bad loan relief?: The interest rates advisory centre offers loan and mortgage interest recalculation, financial cost assurance (overdraft, loan interest), in-duplum interest recalculation for the period (1/1/2001 to 31/7/2005) and informs its clients that that all bank charges from 1/11/89 may be illegal!
Though IRAC won against Housing Finance, bad debt relief may be a pipe dream for most, except for a few instances
Other corporate news
Keroche going into beer production after huge bill handed to them of unpaid taxes. This is the last thing that Kenya Breweries wanted to hear
The Minister for Finance has approve the takeover of Kobil Petroleum by sister company Kenya Oil Company Limited (Kenol). But Kobil is/was a Delaware corporation?
Fake sugar: Strange saga of a ship which arrived at Mombasa with contraband sugar already packaged in Mumias sugar bags – ready to go to store shelves. Packing sugar in their 'produced in Kenya' branded bags has been a key branding initiative by Mumias to differentiate it from imported sugar and seems to have worked, but counterfeiters can only be kept at bay for so long
Wananchi TV: convergence as Kenya's largest ISP wananchi is going into partnership with GTV to begin high speed cable and satellite TV all in one package.
Also mobile TV on phones : a few months ago, the bosses of Kenya Broadcasting Corporation were on TV from a golf tournaments talking about their plans for the rest of the year which included launching a new radio station and also coming up with the first news broadcast via mobile phones by September. (Read on - KBC is a shareholder in the local multichoice Kenya)
Opportunities
- A new Equity Fund in Kenya urgently looking for a financial systems engineer with banking experience. Apply to ndeman2@yahoo.com
- Apprentice to Africa. The Apprentice Challenge comes to Africa – with $200,000 in prize money
Friday, September 21, 2007
Tax Collection is Unprofitable
KRA shocker
The Kenya Revenue Authority, the organization which has re-written our donor relationship, championed responsibility/awareness of tax paying among citizens, spurred parastatals to start paying dividends back to the government (instead of draining it) and enable the fixing of the economy – is not profitable!
Year end results (June 2006) show the tax collector with income of 4.8 billion and expenditure of 6.0 billion – meaning a deficit of 1.2 billion and that compares to 2005 when they just about broke even 5.1 billion of income and expenditure. They also don’t have the title deed to their headquarters – Times Tower worth 2.5 billion that is still in the name of Central bank (for whom the tower was built)
Stanbic CFC merger approved
The Finance Minister has approved the merger between Stanbic and CFC paving the creation of the country’s 4th largest bank (see bank rankings and an earlier comparison of the parties)
The combined, but yet to be named, bank will have assets of over 55 billion shillings ($800 million), deposits of 43 billion, loans of 30 billion and a pre tax profit as June 2007 of 934 million ($14 million)
Capital markets authority (CMA) approval should be a formality, as they have already been assured that the new bank will remain listed on the NSE.
MP behaving badly
A high flying MP has grabbed i.e. taken over and fenced the parking lot of a popular Nairobi Sports Pub which he frequents the place – even as he is trying to extract an exorbitant rent from the pub for use of the yard.
The Kenya Revenue Authority, the organization which has re-written our donor relationship, championed responsibility/awareness of tax paying among citizens, spurred parastatals to start paying dividends back to the government (instead of draining it) and enable the fixing of the economy – is not profitable!
Year end results (June 2006) show the tax collector with income of 4.8 billion and expenditure of 6.0 billion – meaning a deficit of 1.2 billion and that compares to 2005 when they just about broke even 5.1 billion of income and expenditure. They also don’t have the title deed to their headquarters – Times Tower worth 2.5 billion that is still in the name of Central bank (for whom the tower was built)
Stanbic CFC merger approved
The Finance Minister has approved the merger between Stanbic and CFC paving the creation of the country’s 4th largest bank (see bank rankings and an earlier comparison of the parties)
The combined, but yet to be named, bank will have assets of over 55 billion shillings ($800 million), deposits of 43 billion, loans of 30 billion and a pre tax profit as June 2007 of 934 million ($14 million)
Capital markets authority (CMA) approval should be a formality, as they have already been assured that the new bank will remain listed on the NSE.
MP behaving badly
A high flying MP has grabbed i.e. taken over and fenced the parking lot of a popular Nairobi Sports Pub which he frequents the place – even as he is trying to extract an exorbitant rent from the pub for use of the yard.
Tuesday, September 04, 2007
Kenya Bank Rankings
June 2007 [ and change from June 2006]
Tier I banks
1. Barclays Kshs. 136.54 billion in assets ($1.95 billion) (up 21% from June 2006)
2. Kenya Commercial 96,532 [17%]
3. Standard Chartered 92, 743 [13%]
4. Cooperative 58,712 [3%]
5. CFC /Stanbic 55,534 +
6. National Bank of Kenya 42, 142 [25%]
7 Commercial Bank of Africa 36,217 [10%]
8. Citibank Kenya 36,147 [8%]
9. Equity 29,888 [116%]
- CFC 27,926 [25%]
- Stanbic 27, 608 [62%]
10. NIC 27,583 [22%]
Tier 2 banks
11. Investment & Mortgages 24,494 ($349 million) [19%]
12. Diamond Trust 24, 484 [37%]
13. Baroda13,253 [24%]
14. Imperial 11,039 [30%]
15. Prime 10,773 [25%]
16. Housing Finance 9,665 [-2%]
17. Bank of India 9,552 [21%]
18. EABS 9,049 [5%]
19. Fina 7,688 [25%]
20. Bank of Africa 7,347 [26%]
21. Family Finance 6,698 [73%]
22. K-Rep 6,358 [43%]
Tier 3 banks
23. Habib AG Zurich 5,393 ($77 million) [5%]
24. Giro 5,317 [3%]
25. ABC 5,282 [10%]
26. Guardian 4,970 [2%]
27. Chase 4,826 [74%]
28. Southern Credit 4,581 [8%]
29. Victoria 4,081 [2%]
30. Consolidated 4,001 [28%]
31. Development Bank of Kenya (DBK) 3,876 [35%]
32. Equatorial 3,832 [5%]
33. Habib Bank 3,485 [10%]
34. Middle East 3,309 [-9%]
35. Credit 2,963 [5%]
36. Fidelity 2,779 [43%]
37. Transnational 2,720 [24%]
38. Paramount Universal 2,271 [27%]
39. Oriental (formerly Delphis) 1,624 [17%]
40. Dubai 1,437 [26%]
41. City Finance 510
-- Charterhouse 3,938
+ Merger, awaiting approval
Asset growth
industry average 24%
Equity 116%
Chase 74%
Family Finance 73%
Stanbic 62%
K-Rep 43%
Profit growth
average 76%
Bank of Africa 825%
Habib bank 467%
Giro 300%
Paramount universal 300%
Fidelity 222%
EABS 200%
Southern credit 186%
Chase 179%
Oriental 115%
Equity 107%
Loan grwoth
average 19%
Equity 785
Family Finance 67%
K-Rep 66%
Diamond Trust 51%
KCB 49%
Deposit growth
average 25%
Equity 111%
Stanbic 95%
Chase 84%
DBK 63%
Family finance 57%
Tier I banks
1. Barclays Kshs. 136.54 billion in assets ($1.95 billion) (up 21% from June 2006)
2. Kenya Commercial 96,532 [17%]
3. Standard Chartered 92, 743 [13%]
4. Cooperative 58,712 [3%]
5. CFC /Stanbic 55,534 +
6. National Bank of Kenya 42, 142 [25%]
7 Commercial Bank of Africa 36,217 [10%]
8. Citibank Kenya 36,147 [8%]
9. Equity 29,888 [116%]
- CFC 27,926 [25%]
- Stanbic 27, 608 [62%]
10. NIC 27,583 [22%]
Tier 2 banks
11. Investment & Mortgages 24,494 ($349 million) [19%]
12. Diamond Trust 24, 484 [37%]
13. Baroda13,253 [24%]
14. Imperial 11,039 [30%]
15. Prime 10,773 [25%]
16. Housing Finance 9,665 [-2%]
17. Bank of India 9,552 [21%]
18. EABS 9,049 [5%]
19. Fina 7,688 [25%]
20. Bank of Africa 7,347 [26%]
21. Family Finance 6,698 [73%]
22. K-Rep 6,358 [43%]
Tier 3 banks
23. Habib AG Zurich 5,393 ($77 million) [5%]
24. Giro 5,317 [3%]
25. ABC 5,282 [10%]
26. Guardian 4,970 [2%]
27. Chase 4,826 [74%]
28. Southern Credit 4,581 [8%]
29. Victoria 4,081 [2%]
30. Consolidated 4,001 [28%]
31. Development Bank of Kenya (DBK) 3,876 [35%]
32. Equatorial 3,832 [5%]
33. Habib Bank 3,485 [10%]
34. Middle East 3,309 [-9%]
35. Credit 2,963 [5%]
36. Fidelity 2,779 [43%]
37. Transnational 2,720 [24%]
38. Paramount Universal 2,271 [27%]
39. Oriental (formerly Delphis) 1,624 [17%]
40. Dubai 1,437 [26%]
41. City Finance 510
-- Charterhouse 3,938
+ Merger, awaiting approval
Asset growth
industry average 24%
Equity 116%
Chase 74%
Family Finance 73%
Stanbic 62%
K-Rep 43%
Profit growth
average 76%
Bank of Africa 825%
Habib bank 467%
Giro 300%
Paramount universal 300%
Fidelity 222%
EABS 200%
Southern credit 186%
Chase 179%
Oriental 115%
Equity 107%
Loan grwoth
average 19%
Equity 785
Family Finance 67%
K-Rep 66%
Diamond Trust 51%
KCB 49%
Deposit growth
average 25%
Equity 111%
Stanbic 95%
Chase 84%
DBK 63%
Family finance 57%
Thursday, August 30, 2007
Bank Sold
Name this bank?
The deal of the year brings together Stanbic and CFC Banks merge together and is expected to be finalized next month with only Central bank and CMA approval left.
The combined, but yet to be named, bank will have assets of over 55 billion shillings ($800 million), deposits of 43 billion, loans of 30 billion and a pre tax profit as June 2007 of 934 million ($14 million)
Mzalendo bank account
Commenting on the report on bank charges released this week, The Governor of the Central Bank called for a Mzalendo bank account which would probably be akin to mzansi from South Africa which is a low cost account at several banks (with wide branch networks – e.g. KCB, Equity, Postbank) that has similar features and charges at all the banks
banking is not cheap
A recent report released on the banking sector shoed that banking not cheap is not cheap for most account holders .
This should not be a surprise to the public who read about the bank profits or the authorities who are sent all charges and tariffs by the banks each month
There’s already been grumbling from research firms ho say a local firm could have carried out the survey and some banks who say the report is inaccurate.
Earlier, some advertised banking is unexpectedly not as cheap
The deal of the year brings together Stanbic and CFC Banks merge together and is expected to be finalized next month with only Central bank and CMA approval left.
The combined, but yet to be named, bank will have assets of over 55 billion shillings ($800 million), deposits of 43 billion, loans of 30 billion and a pre tax profit as June 2007 of 934 million ($14 million)
Mzalendo bank account
Commenting on the report on bank charges released this week, The Governor of the Central Bank called for a Mzalendo bank account which would probably be akin to mzansi from South Africa which is a low cost account at several banks (with wide branch networks – e.g. KCB, Equity, Postbank) that has similar features and charges at all the banks
banking is not cheap
A recent report released on the banking sector shoed that banking not cheap is not cheap for most account holders .
This should not be a surprise to the public who read about the bank profits or the authorities who are sent all charges and tariffs by the banks each month
There’s already been grumbling from research firms ho say a local firm could have carried out the survey and some banks who say the report is inaccurate.
Earlier, some advertised banking is unexpectedly not as cheap
Tuesday, June 26, 2007
Convenient banking
making trades offs as convenient banking is not the same thing as cheap banking
Equity has been the fastest growing bank in the country over the last few years. It has won customers, now 1+ million, and has sent bigger banks banks back to the drawing board to woo & retain their customers.
However, while banking with them may not be cheap for a business, it is convenient, and offers finance and flexibility to an upcoming business. People coming from abroad complain about the cost of making mobile calls here – saying they are expensive. But compared to what? A taxi driver will make a 30 shilling mobile phone call to secure a 2,000 shilling job as his phone is his office.
Same with Equity their low entry minimums suit individuals and start ups. And while some of their charges are rather hefty (3% for ENC and 10% of amount for a temporary overdrafts), as a businesswoman told me today, their quick decision making and the fact that they are the only bank that can offer these facilities to her make them the optimal bank for now. Getting cheques cleared, guarantees, and payments to suppliers matter more to her now, than the cost of these services, and help her build a credit record for the future. Once she is more established,. she will look question the transaction costs and have other banks now wooing her business.
Other banking briefs
According to Africa confidential, Kenya is favored to be the new host country for the African development bank, with Botswana second in the ranking. However Ivory Coast is back in the running following the signing of a peace accord. More on homeless banks.
The CBR Bank rate was lowered from 10 to 8.5%
The Government has commissioned a study to look into the low uptake of youth enterprise fund and agriculture development funds. They are blaming banks for asking borrowers for collateral and 3 month bank statements – terms which were not spelt out in the funds. from an offline story from the East Africa:
CFC Stanbic bank pre –merger comparisons
Diamond Trust acquired a majority shareholding in Diamond Trust in the just concluded rights issue.
Equity Bank
- Looking to enter the money transfer business
- To buy Housing Finance bank - what do the bloggers say?
Family bank got admitted to the CBK bank clearing house earlier in June, just a few weeks after being licensed. Family took advantage and pressed for an exemption (on a two year waiting period), similar to that granted to Equity Bank when it also became a bank. from an offline story from the standard
National Bank is seeking to commit Ketan Somaia to civil jail over a 17 million debt
Pyramids schemes continue to
thrive despite numerous warnings. However, some schemes feeling a cash pinch are passing the blame to the central bank who are limiting the interest they can pay depositors to 10% p.a. - before they were paying over 10% per month.
Equity has been the fastest growing bank in the country over the last few years. It has won customers, now 1+ million, and has sent bigger banks banks back to the drawing board to woo & retain their customers.
However, while banking with them may not be cheap for a business, it is convenient, and offers finance and flexibility to an upcoming business. People coming from abroad complain about the cost of making mobile calls here – saying they are expensive. But compared to what? A taxi driver will make a 30 shilling mobile phone call to secure a 2,000 shilling job as his phone is his office.
Same with Equity their low entry minimums suit individuals and start ups. And while some of their charges are rather hefty (3% for ENC and 10% of amount for a temporary overdrafts), as a businesswoman told me today, their quick decision making and the fact that they are the only bank that can offer these facilities to her make them the optimal bank for now. Getting cheques cleared, guarantees, and payments to suppliers matter more to her now, than the cost of these services, and help her build a credit record for the future. Once she is more established,. she will look question the transaction costs and have other banks now wooing her business.
Other banking briefs
According to Africa confidential, Kenya is favored to be the new host country for the African development bank, with Botswana second in the ranking. However Ivory Coast is back in the running following the signing of a peace accord. More on homeless banks.
The CBR Bank rate was lowered from 10 to 8.5%
The Government has commissioned a study to look into the low uptake of youth enterprise fund and agriculture development funds. They are blaming banks for asking borrowers for collateral and 3 month bank statements – terms which were not spelt out in the funds. from an offline story from the East Africa:
CFC Stanbic bank pre –merger comparisons
Diamond Trust acquired a majority shareholding in Diamond Trust in the just concluded rights issue.
Equity Bank
- Looking to enter the money transfer business
- To buy Housing Finance bank - what do the bloggers say?
Family bank got admitted to the CBK bank clearing house earlier in June, just a few weeks after being licensed. Family took advantage and pressed for an exemption (on a two year waiting period), similar to that granted to Equity Bank when it also became a bank. from an offline story from the standard
National Bank is seeking to commit Ketan Somaia to civil jail over a 17 million debt
Pyramids schemes continue to
thrive despite numerous warnings. However, some schemes feeling a cash pinch are passing the blame to the central bank who are limiting the interest they can pay depositors to 10% p.a. - before they were paying over 10% per month.
Saturday, June 23, 2007
CFC Stanbic Bank
CFC Stanbic Bank is the official name of the proposed new entity created by the merger of the CFC and Stanbic banks' pending approval from among others shareholders, Capital Markets Authority, Central Bank of Kenya (Minister of Finance).
The merger makes sense in that the 9th and 10th largest banks (both around $350m in assets) can merge to become the 4th largest bank in the country (after Barclays, KCB, Stanchart)
Sticking points are that the deal is structured to include the creation of new shares (113 million) that will be transferred to Stanbic in addition to buying a majority of Gambit shares (currently the largest shareholder in CFC). Gambit will still remain as the 4th largest shareholder in the bank after the merger.
To sweeten the deal, CFC Stanbic Bank will remain listed on the NSE and Stanbic Kenya will be a wholly owned subsidiary. Also the statement points out their branch networks complement each other, so perhaps only Mombasa (where they, and most banks, have branches on Nkurmah street) and branches in Uchumi stores may need a work out.
When the story first broke last year (despite having a caution), it sent CFC's share price up 10X (to about 900 shillings) and this notice also advises shareholders to exercise caution in dealing their CFC shares until further announcements are made. The announcement was released on Friday (but not yet up on NSE site), and published in the newspapers on Saturday to perhaps dampen the speculative mood/euphoria and allow careful analysis to set in before Monday.
(I Don’t have CFC shares but they have been very good stockbrokers to me. Unrelated to this is, I have Stanbic Uganda shares)
The merger makes sense in that the 9th and 10th largest banks (both around $350m in assets) can merge to become the 4th largest bank in the country (after Barclays, KCB, Stanchart)
Sticking points are that the deal is structured to include the creation of new shares (113 million) that will be transferred to Stanbic in addition to buying a majority of Gambit shares (currently the largest shareholder in CFC). Gambit will still remain as the 4th largest shareholder in the bank after the merger.
To sweeten the deal, CFC Stanbic Bank will remain listed on the NSE and Stanbic Kenya will be a wholly owned subsidiary. Also the statement points out their branch networks complement each other, so perhaps only Mombasa (where they, and most banks, have branches on Nkurmah street) and branches in Uchumi stores may need a work out.
When the story first broke last year (despite having a caution), it sent CFC's share price up 10X (to about 900 shillings) and this notice also advises shareholders to exercise caution in dealing their CFC shares until further announcements are made. The announcement was released on Friday (but not yet up on NSE site), and published in the newspapers on Saturday to perhaps dampen the speculative mood/euphoria and allow careful analysis to set in before Monday.
(I Don’t have CFC shares but they have been very good stockbrokers to me. Unrelated to this is, I have Stanbic Uganda shares)
Tuesday, June 05, 2007
Madaraka Banking Week
The African Development Bank sets up a regional office in Nairobi.
CFC - Stanbic merger on track.
Dar es Salaam community bank extending their rights issue offer by one month to June 30.
A bank site was hacked (this one?)
Family Bank is being sued for making a bribery allegation against a Central bank official
First Community Bank to be Kenya's first Islamic Bank
An blog investor perspective on the Housing Finance rights issue
KCB plans to open 2 0 branches in Sudan. Also there brief panic created by a smoky generator this week atop Kencom House.
CFA's wanted: Investment banking gets even more lucrative now in Kenya
CFC - Stanbic merger on track.
Dar es Salaam community bank extending their rights issue offer by one month to June 30.
A bank site was hacked (this one?)
Family Bank is being sued for making a bribery allegation against a Central bank official
First Community Bank to be Kenya's first Islamic Bank
An blog investor perspective on the Housing Finance rights issue
KCB plans to open 2 0 branches in Sudan. Also there brief panic created by a smoky generator this week atop Kencom House.
CFA's wanted: Investment banking gets even more lucrative now in Kenya
Friday, April 27, 2007
Stanbic apples & oranges
Standard Bank (of South Africa) operates as Stanbic in other parts of Africa.
Here’s a snapshot comparison of the 2006 financial results of Stanbic Kenya and Stanbic Uganda.
Stanbic Kenya is unlisted while several Kenyans participated in the 2006 Stanbic Uganda IPO which was relatively cheap owing to the exchange rate difference (25:1) between Kenya and Uganda. The Stanbic (UG) IPO was partly blamed for the performance of the Mumias (Kenya) rights issue whose uptake was judged to be average.
Merger talks between Stanbic (K) and CFC which is another locally listed Kenyan bank are at an advanced stage. So how do the bank’s compare?
Approximate figures in US$
Rank
Uganda Stanbic (1 in Uganda)
Kenya Stanbic (9 in Kenya)
CFC (10)
Assets
Uganda Stanbic $725 million
Kenya Stanbic 378 million
CFC 371 million
Deposits
Uganda Stanbic $513 million
Kenya Stanbic 289 million
CFC 271 million
Loans
Uganda Stanbic $195 million
Kenya Stanbic 166 million
CFC 220 million
Pre-tax Profits
Uganda Stanbic $32.3 million
Kenya Stanbic 13.4 million
CFC 9.9 million
Here’s a snapshot comparison of the 2006 financial results of Stanbic Kenya and Stanbic Uganda.
Stanbic Kenya is unlisted while several Kenyans participated in the 2006 Stanbic Uganda IPO which was relatively cheap owing to the exchange rate difference (25:1) between Kenya and Uganda. The Stanbic (UG) IPO was partly blamed for the performance of the Mumias (Kenya) rights issue whose uptake was judged to be average.
Merger talks between Stanbic (K) and CFC which is another locally listed Kenyan bank are at an advanced stage. So how do the bank’s compare?
Approximate figures in US$
Rank
Uganda Stanbic (1 in Uganda)
Kenya Stanbic (9 in Kenya)
CFC (10)
Assets
Uganda Stanbic $725 million
Kenya Stanbic 378 million
CFC 371 million
Deposits
Uganda Stanbic $513 million
Kenya Stanbic 289 million
CFC 271 million
Loans
Uganda Stanbic $195 million
Kenya Stanbic 166 million
CFC 220 million
Pre-tax Profits
Uganda Stanbic $32.3 million
Kenya Stanbic 13.4 million
CFC 9.9 million
Thursday, December 28, 2006
2006 Kenya banking review
based on reported figures for September 2006
1. Barclays Bank of Kenya [assets worth 117.17 billion shillings ($1.67 billion)] In 2006 Barclays made a major policy about turn and announced expansion plans including reopening branches they had closed a few years ago. They also venture into Shariah compliant banking as did KCB, I&M, Dubai and K-Rep banks.
Compared to September 2005, assets were up 10%, deposits 12%, loans 14% but income was up only 6%. They also increased their investment in government securities to about 40% of the loan book. Still despite being Kenya’s largest bank, it also has the 2nd highest return on assets at 4.16% (second only to Equity Bank at 4.74%)Barclays shareholders had a very happy year, which saw them earn a bonus share and a share split in addition to their usual top dividend.
2. Kenya Commercial Bank [84.92 billion] KCB nudged passed Stanchart in assets while its share price zoomed passed though Stanchart still has a higher market cap and better returns. KCB’s expansive rural branch network was the envy of other banks such as Barclays and it also expanded into Sudan in 2006. KCB’s assets were up 18%, deposits 17%, loan 13% while income was up 26% from a year ago
3. Standard Chartered [84.09 billion] The bank launched several new products including accounts aimed as women (Diva) and children and adult savings (Safari) accounts. Stanchart also appointed a new MD – Mr. Etemesi. Assets up 18% deposits 16% loan s22% and income 10% while it also increased its investment in government securities
4. Cooperative Bank [55.17 billion] Co-op’s strong recovery continued and it remains a strong candidate for a listing in the next two years. One of their unique traditional products - kids’ savings accounts – was invaded by other banks this year. Compared to last September, assets were up 12%, deposits up 18%, income up 19%, but loans down by 16%. Also their total non performing assets (NPA’s) doubled to 17 billion while the bank also tripled its in investment in government securities during the year.
5. National Bank of Kenya [39.37 billion] NBK is yet to have its capital and debt restructuring done even though it is promised every year by the Government and despite reporting profits each quarter, it was not able to pay any dividends. The Bank launched a low fee (Taifa) account to counter the crowds flocking to Equity and Co-op banks. Assets and loan were up 10%, deposits and income up 16% and it tripled investment in government securities but NPA have also doubled to from a year ago.
6. Citibank Kenya [35.43 billion] Assets up 12% loans up 42% and income up 33%. Was a late entrant to the share craze providing advisory services to the Mumias rights issue in November.
7. Commercial Bank of Africa [35.12 billion] CBA opened a new headquarters and is expected to venture into stockbroking. Assets, deposits, loans, and income were all up 21% but NPA also up 45% from a year ago.
8. CFC [25.04 billion] Had a successful rights issue to raise capital and also continued to roll out new insurance products. Its stockbroking unit is the largest in the country and was reported to have processed Eveready applications amounts that exceeded the shares being offered. CFC doubled its investment in government securities, assets were up 35%, deposits and loans up 20%, income up 61% but NPA were also up by 74% from the year before.
9. NIC [23.55] Still the leader in asset finance while their flat fee (MOVE) was imitated by other banks. Assets and deposits were up 18%, loans 15%, and income 33%, but NPA’s doubled from a year ago also. Shareholders finally enjoyed some significant price appreciation after being stuck at 50 /= forever.
10. Standard Bank (Stanbic) [23.29 billion] Many Kenyans bought shares in their Ugandan subsidiary while the Bank has expressed an interest in investing in NBK once it is restructured. Stanbic which has the lowest NPA (followed by Citibank and D-Trust) had assets up 54% deposits and loans up 44% and income was up 49%.
11 Investment & Mortgages [21.79 billion] I&M had assets up 25% deposits 27% loans 36% and income up 33% as the bank made a push into the credit card sector.
12 Diamond Trust [19.14 billion] Raised capital in an over-subscribed rights issue in December and is rumored to consolidate with a sister bank next year. Assets were up 27% deposits 29% loans 25% while income was up 33% from a year ago.
13 Equity [16.33 billion] Kenya’s s fastest growing bank had assets up 63% deposits 81% loans 105% and income 90% however expenses in Q3 grew faster than income and NPA’s are up 165%. It has the highest returns (assets 5% and equity 46%) and successfully listed all their shares on the NSE in 2006
14 Bank of Baroda [11.43 billion] Assets and deposits up 29%, loans up 27%, income up 22% and profit could double this year.
15 Housing Finance [9.8 billion] Has a new MD while its share price appreciated beyond expectation leaving it with the highest P/E on the NSE. Assets, deposits, loans, income, and expenses remained basically unchanged from a year ago while the bank has converted cash into government securities. The lack of new loan growth resulted in NPA’s forming a greater portion (72%) of loan book.
16 Prime Bank [9.26 billion] Assets and income up 40%, deposits 43% loan 29% and profits are up 69% from a year ago.
17 EABS Bank [8.55 billion] Teething pains continue as assets shrunk by 4% but with a positive outlook as income increased twice as fast as operating expenses this year, but still NPA’s are at 72%.
18 Imperial [8.47 billion] Assets up 5% loan 146% and securities up 60% as the bank had redeployed about 1 billion in placements. Income is up 13% and Imperial has among the top 5 returns (even better than Citibank)
19 Bank of India [8.15 billion] Assets and deposits up 20%, loans up 56%, income up 46% but NPA up 43% - still the bank is on track for a huge profit this year.
20 Bank of Africa [6.23 billion] Expects to open another Nairobi branch and but into a bank in Uganda to go with the one it invested into in Tanzania. Assets up 17% deposits 35% loans 16% and income up 31% and despite increase expansion costs remains on track to achieve a profit this year.
21 Fina [6.15 billion] One of the banks that has championed SME financing and also has an extensive operation in Rwanda. Assets unchanged from a year ago while loans up 17% profits will be 41% higher, but NPA also up 59%.
22 Habib AG Zurich [5.07 billion] Asset up 9%, loans 16% and income up 11% at this bank which invests primarily in government securities.
23 ABC [4.95 billion] Assets up 7% with loans up 4%, and income up 20% from a year ago however NPA’s also up 46%.
24 Giro [4.93 billion] Nothing much heard from partnership with SBI (India) and
Assets were up 3%, income up 9%, but loans down 13% and profit will be less than 2005.
25 Guardian [4.66 billion] Assets up 2%, and bank has upped its investment in government securities by 61% compared to 2% growth in loans – however NPA up 216% .
26 K-Rep [4.52 billion] One of the banks that pioneered the micro-finance sector now finds itself being crowded out by new entrants advertising all manner of SME packages. It will administer an ADB guaranteed line of credit for women entrepreneurs (along with CFC and CBA). Assets up 31,% deposits 59& and income up 50% proving that micro finance is low risk niche with only 4% NPA’s even as loans by K-Rep increased by 40%.
28 Southern Credit [4.27 billion] Assets up 1% deposits up 6% and loans 9% but with NPA’s up 52% from a year ago at the bank with a major credit card arm.
29 Victoria [4.19 billion] Assets and deposits up 8% and the bank has reduced its NPA’s by 49% and now has the lowest NPA in the country at 1% with 1 billion shilling in the bank.
30 Charterhouse [3.94 billion] The bank was placed under statutory management following money laundering and tax evasion allegations and has fought back through the courts and the press (& with some questionable tactics). Even as depositors are locked out, assets up 19% but profits down 33% and the CBK manager increased investments in government securities - up by 332% (as directed by the law)
31 Equatorial [3.67 billion] A Sameer bank had assets up 1% but reduced government securities by 72% to increase loans by 22% but NPA also up 75%.
32 Middle East [3.45 billion] Assets up 1%, loans up 45%, but deposits down 10% yet bank may increase its profit as a result of an improved NPA positions.
33 Consolidated [3.45 billion] Assets up 29%, deposits & loans up 33% and despite high NPA it may achieve a profit in 2006. The Deposit protection fund is expected to sell its 50% stake in the bank, but without a profitable track record it will remain private.
34 Chase [3.29 billion] Assets up 33%, deposit 53%, loans & income up 43% but NPA also up 42%.
35 Development Bank of Kenya [3.05 billion] Assets up 20%, deposits & loans are up 50% but NPA up 52%.
36 Habib Bank [3.02 billion] Assets, deposit, and loans, all up 4% this year at Habib which is rumored to consolidate with sister bank in 2007. Has the highest ratio of investment in government securities.
37 Credit [2.77 billion] Assets down 6% and NPA up 125% as the bank drops 3 places in rankings.
38 Transnational [2.44 billion] Assets up 12%, while deposits & loans up 20% from a year ago but NPA also up 73%.
39 Fidelity [2.11 billion] Income up 50% while deposits & loans both up 35% from a year ago.
40 Paramount Universal [2.05 billion] Assets up 55%, deposits up 72% but income is flat and NPA's are significantly up.
41 Oriental (formerly Delphis) [1.37 billion] Losses continue to eat into assets. Growth in income finally faster than growth in expenses but not enough to reverse wipe out of gains in the 1st half of the year as the bank moves further away from profitability and drops behind Paramount in size.
42 Dubai [1.22 billion] One of the first banks to recognize the potential of having a branch in the Eastleigh area now finds itself fighting with new entrants (giants Barclays and KCB) invading the area. Assets up 5%, loans up 12%, deposits up 15%, but NPA up 130% from a year ago.
43 City Finance [0.53 billion] Smallest bank with deposits up 34% (to 130 million), but income down 31% and NPA up 40% from a year ago.
Other institutions
Would be ranked 27 - Family Finance [4.47 billion in assets] Almost as fast growing as Equity with a similarly ambitious expansion plan, but was not able to become a bank since their planned conversion was put on hold by Central Bank. A share capital share of 390 million is more than other existing banks, but new banks are expected to be stronger and so the society went for a controversial private placement which was under-subscribed in November 2006. Assets and profits are up 40% from a year ago while deposits are up 50%.
new bank - Gulf African Will be the first 100% Shariah bank in Kenya
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