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)
– A new Equity Fund in Kenya urgently looking for a financial systems engineer with banking experience. Apply to email@example.com
– Apprentice to Africa. The Apprentice Challenge comes to Africa – with $200,000 in prize money