Category Archives: ABSA

Corporates Loving Golf

Historically, golf has been considered to be a costly sport in Kenya with difficulty in accessing equipment kits and membership clubs to play at. But now golf is enjoying increased corporate attention and bank sponsorships in the post-covid period. Some of these initiatives had begun in the period before the shutdowns in 2020, but the increased need for individuals to exercise in open spaces boosted more interest in hiking, cycling, jogging, and golfing. Golf clubs were previously seen to be losing touch with young people, and many of the new initiatives are designed to turn this around. 

Some ongoing corporate golf partnerships are:  

  • Kenya has been a multiple winner of Africa’s Best Golf Destination at the annual World Travel Awards and the Kenya Tourism Board is keen on using golf to promote tourism both by local and international travelers. Golf is played year-round in Kenya and the country has easy connections to other tourism facilities. KTB cites a consultancy research report that golf travelers spend 2.5x more than leisure travelers and stay for longer periods 
  • Absa Kenya has a long-running sponsorship of the Kenya Open Golf tournament which, with the support of the Government that aims to boost tourism into the country, is known as the Magical Kenya Open and is part of the European Tour. The 2022 edition tournament was played in March at the Muthaiga Club and was won, for the first time, by a Chinese golfer, Ashun Wu.
  • This year, Kenya Airways joined as a corporate partner and had aircraft fly past over Muthaiga on two days of the tournament and, as an official sponsor offered discounted rates to golfers and fans while ferrying in PGA officials working at the tournament. 
  • NCBA has the NCBA Golf Series with ten tournaments around the country that was in Kitale last week and will next be in Kampala, Uganda.  In 2021, the series had 13  tournaments that attracted 1,700 golfers. Some juniors golfers who participated won qualification to two international events – the Rome Classic (Italy) and the Big Five (South Africa).  
  •  The Safaricom Golf Tour has received sponsorship of Kshs 100 million, for a 14-leg tournament that will involve outreach to local communities and make the sport more accessible – it will rope in corporate and amateur players, juniors (play on Sundays), caddies (compete on Mondays) at the different legs. It aims to find new talent for the sport, especially young golfers, and winners of different legs will feature at the finale at Vipingo Ridge in August. The Vipingo Ridge course was launched in 2010 and continues to host several leading international golf tournaments. 
  • Also on the European Tour is the Magical Kenya Ladies Open which is played at the Vipingo course. The Kenya Tourism Board (KTB) is the main sponsor of the tournament which this year featured 90 golfers from 25 countries. The tournament also got a Kshs 20 million sponsorship from Safaricom’s M-Pesa who held a junior golf clinic.
  • Crown Paints and Prime Bank are part sponsors of the US Kids Foundation golf series along with Safaricom and NCBA. The three-year program will be run through the Junior Golf Foundation (JGF) to promote golf development through the training of up to 40 coaches across the country and supports local golf tours to introduce more young people to the sport. It has held events at Limuru and Muthaiga and will have more at Karen and Royal (Nairobi) all leading to a finale at the Muthaiga Golf Club in May 2022.
  • Kenya Ports Authority will have tournaments in different cities of its operations – Nairobi, Mombasa, Kisumu. 
  • The Tannahill Shield one of the largest amateur golf tournaments in the country is ongoing at the Royal Nairobi Golf Club this Easter Weekend. It is sponsored by Jamii Telecom, Rentco and Chipper Cash, a remittance company. 
  • In 2021, Absa Kenya sponsored the Savannah Tour Classic a new event created for the European tour in the recovery from Covid and was staged ahead of the Kenya Open. 
  • The Johnnie Walker Classic golf series resumed after eight years, sponsored by EABL’s The Johnnie Walker Classic golf series resumed after eight years, sponsored by EABL’s Kenya Breweries. “Road to Gleneagles” will have amateur and professional golfers compete at 20 clubs across the country ahead of the finale in May 2022 where the winning team will receive an all-expenses-paid trip to play at the Gleneagles in Scotland which is one of the top golf courses in the world. For the professionals, participation will help them to improve their competitiveness for the European tour events played in Kenya. 
  • Insurance companies including ICEA and Liberty (a Stanbic affiliate) also support golf as do other companies in the sector. 
  • EDIT: Amateur golfers are invited to enter the Race to Vipingo Ridge by registering and submitting scores achieved during “club nights” at their home clubs between 18 April and the end of June for a chance to win a chance to play in the finals at Vipingo Ridge, with their transport and accommodation careered for. Note, there is an entry fee for the qualifying rounds.
  • EDIT: NMG has the Nation Classic Golf Series again for 2022.

Absa Kenya resumes dividends after record FY2021

Banking seems to have gotten over the shocks of the last two years, going by the outlook of Absa Bank Kenya. The bank released its 2021 financial results in Nairobi today and signalled a recovery with a resumption of dividend payouts similar to pre-Covid times.

The bank recorded assets of Kshs 429 billion and pre-tax profit of Kshs 15.6 billion for 2021, up from Kshs 5.6 billion in the previous year. Its deposits of Kshs 269 billion and loans of Kshs 234 billion had grown by 6% and 12% respectively. Absa Kenya will pay a dividend of Kshs 1.1 per share to its shareholders, equivalent to a sum of Kshs 6 billion or 58% of its profits. This comes after a dividend freeze last year in which the bank had rescheduled 30% of its loan book to accommodate its customers whose business and lives had been affected by the Covid-19 trade disruptions.

Absa Kenya Managing Director, Jeremy Awori said that 95% of the rescheduled borrowers had since resumed making loan repayments and the bank was able to lend another Kshs 128 billion in 2021.

The bank grew income by 7% to Kshs 37 billion and impairments decreased by 48% to Kshs 4.7 billion. The results were booked without the weighty exceptional items as it has completed the separation, rebranding and transition exercise from Barclays Kenya to Absa Kenya.

Chief Financial Officer, Yusuf Omari said the bank had strong capital and liquidity ratios and was in a good position for 2022 and onwards. He added that the capital position is stronger than in pre-Covid times, and the bank’s bad debt ratio is now at 7.8% compared to the Kenya banking sector average of 13%.

Awori said that the country’s GDP was on the rebound and services, notably tourism, were expected to recover with the removal of travel and quarantine restrictions that had kept business people, tourists and other nationals from visiting the country. There was however caution given the ongoing conflict in Ukraine following the invasion by Russia and which is expected to drive up food and fuel prices across the globe.

Chief Strategy Officer, Moses Muthui said that the last five years had been about growing revenue, driving transformation and bringing down costs. He added that with the separation done, Absa could focus on further diversifying its retail products, growing business banking, and building a regional powerhouse in corporate and institutional banking.

Absa Kenya rebounds from Covid hit

As the wave of quarterly financial results by Kenyan banks stream in this month, the banking industry appears to have recovered from the early effects of the Covid-19 pandemic. 

Absa Bank, Kenya’s fifth-largest bank with assets of Kshs 398 billion ($3.6 billion), released its results, showing a 5x growth in pre-tax profits in the half-year, from 1.6 billion last June to 8.0 billion in June 2021. In the half-year period,  it made provisions of Kshs 1.9 billion compared to Kshs 5.3 billion last June. Overall, loans have grown from Kshs 202 to 219 billion (8%) while deposits have grown from Kshs 249 to 264 billion, representing a loan-to-deposit ratio of 83%. 

The banking industry made many responses to Covid-19, including reducing digital bank charges and restructuring customer loans. Absa restructured 59,000 loans worth Kshs 62 billion, representing 30% of its balance sheet. Absa Kenya’s Managing Director, Jeremy Awori, said it had been a good initiative to work with customers as, by June 2021, 94% of the loans have resumed repayments and the bank’s non-performing asset levels were down to below the industry average of 14%. 

In the last seven years, the bank had doubled the size of its balance sheet, navigated the re-branding from Barclays to Absa, and brought down its cost to income ratio from 53% to 45%.

Absa will optimize costs through technology to improve banking services. In 2021, it will invest Kshs 1.6 billion in technology initiatives; they have already launched WhatsApp banking and will upgrade the Timiza digital banking platform, expand agency banking, automate securities trading and increase cash deposit ATMs and rollout of contactless cards. 

Going forward, Absa Kenya management expects that, with the built-up strong capital and liquidity, the bank will be in a good position to pay a dividend to the shareholders at the end of the year which they missed last year.

Absa Kenya launches Asset Management

Absa Bank Kenya has rolled out an asset management subsidiary following approval from Kenyan regulators to expand its century-old business of offering financial services in the country. 

Following approval by both the Capital Markets Authority (CMA) and the Retirement Benefits Authority (RBA), Absa Asset Management will offer advice and products for customers to invest in listed shares, treasury bonds, corporate bonds, private equity, property, offshore and other investment classes.

Anthony Mwithiga, the CEO of the new Absa Asset Management unit, said they would offer fund and investment management for institutions, such as pension schemes, retail solutions for the mass market, and bespoke or personalized services for high-net-worth individuals.

The retail solution will offer investment opportunities through five different unit trusts being, a money market fund for Kenya shillings or US dollars, a bond one, a balanced fund, and an equities fund that people can subscribe to for as little as Kshs 1,000. All the classes will benefit from the data-driven insights, investment professional advice and risk management of Absa that is guided by three pillars of value growth, income generation and value preservation.

The CEO of the RBA Nzomo Mutuku said that that investment management, now with Kshs 1.4 trillion of assets under management, still has great potential to grow and that the performance of these investments is what drives pension benefits in Kenya, not pension contributions.

He said that being diverse had sustained growth even during Covid-19. While there has been a decline in interest for corporate bonds, private equity has gone up (from 0.07% to 0.12% as a share of portfolios) and good returns had also been got from ETF‘s that are about to get a boost from a new class for fixed income, and REIT‘s from new tax laws. He added that, when the shilling depreciates, offshore investments deliver good performance. Another new class is now infrastructure in which funds can invest 10% of assets and they are waiting to see which Public-private-partnership (PPP) projects come online.

Idea Exchange: Antler, Forbes, Museums, ODM.

New, and ongoing, opportunities to apply for.

  • As part of their one-year anniversary celebrations, Absa Kenya has invited people to write in on “Wall of possibilities” of community-uplifting things that they would like to Bank to fund. Each idea may get up to Shs 2.5 million and the deadline is 5 March.
  • Antler Global is seeking new startup companies to support with funding and mentoring. The Nairobi deadline is in April, and here’s a glimpse of the 2020 cohort at Antler.
  • Nominate the Woman Entrepreneur You Admire Most to the COMESA 50 Million African Women Speak Platform.
  • DFC, the U.S. International Development Finance Corporation is offering financing of between $3 million and $50 million to African companies in support of the continent’s COVID-19 recovery – via Asoko
  • The Forbes Africa 30 Under 30 Class of 2021 in categories for creatives, sports, and business and technology.  Deadline is March 31.  
  • Apply for the 2021 Global Teacher Prize ($1 million) and the new sister award, the Chegg.org Global Student Prize ($50,000). Deadline is 30 April.
  • The Hack the Normal hackathon takes place between 5 – 7 March 2021, invites participants to develop new products, services and business models with commercialization potential in these businesses and create solutions for financial challenges, sustainable living and healthy living.
  • The new Kikao64 co-working hub at Eldoret has 50% discount for non-profits, athletes and startup businesses, while others who sign on through the end of April 2021, get discounts of 25%.
  • The Konza innovation challenge offers $5,000 of funding for startups to pilot their innovations at the Konza Technopolis. Deadline is March 19. 
  • edit The Communication Authority of Kenya 2021 Kuza Awards rewards excellence in broadcasting. Regulatory awards are for compliance, local content, children & broadcasting, regional broadcaster, upcoming broadcaster and copyrights. Also, People Choice awards for favorite radio station, TV station, pay TV, news Radio station and TV station. This year has a theme for “Preserving our Heritage through Broadcasting (Kenya a Heritage of Splendour)”, and there is a Patriotic Award category with awards for Uzalendo Award (airing announcements on Covid-19) and Mzalendo Mkuu Award (educational content). SMS Kuza to 15601 to vote for free.
  • Mask Art awards are open to schools and young people under 25 in categories of the school of the future, young entrepreneur and environmental activist. Deadline is April 1.
  • The East Africa Maritime Awards (EAMA) recognize and award notable users of the Port of Mombasa. Organized by the Kenya Ports Authority, it is open to shipping, ports, services, engineering, and leisure marine industries with operations in Kenya, Uganda, Tanzania, Rwanda, Burundi, South Sudan, and the Democratic Republic of Congo (DRC).  The deadline has been extended to March 31.
  • edit From the MasterCard Foundation comes the Baobab’s Got Talent challenge, an exciting storytelling opportunity for young creatives (animation, graphic design, video production) in Africa. Deadline is March 15.
  • From MIT Solve, the 2021 Global Challenge and Solve’s first US Challenge on Antiracist Technology are now open. Anyone anywhere can submit a solution to become part of the 2021 Solver class and access more than $1.5 million in funding.
  • The National Museums of Kenya is seeking historical memorabilia on Kenya, from the year 1800. The items, including photos, film, memorabilia, weapons, musical instruments, farm tools, art, newspaper cuttings, passbooks, etc. can be donated or shared on a long-term loan basis. The deadline is 19 March.
  • For the presidential candidate at ODM, the party is seeking a committed, passionate disciplined and dependable party member who can mount a successful campaign. The entry fee is Kshs 1 million and with a reduced amount of Shs 500,000 for women, youth or persons with disabilities. Deadline is 31 March. 
  • Post Office boxes are available across Kenya. Pick one up by March 31 and get a 30% discount.
  • edit SEED, the Stanford Institute for Innovation in Developing Economies, partners with entrepreneurs (CEO’s / founders) in Africa and South Africa emerging markets to build thriving enterprises that transform lives. Applications deadline is April 15.
  • edit The Eastern and Southern African Trade and Development Bank (TDB) and Asoko Insight have launched a Renewable Energy DealRoom to accelerate the financing of renewable energy projects in the region served by TDB.
  • The Thunderbird School of Global Management is offering a unique scholarship for Africans to attend the online Masters of Applied Leadership & Management with a specialization in Public and Global Affairs starting on March 8, 2021. African students will pay a special tuition of $12,000, compared to $33,000 for other students, representing a scholarship of $21,000.
  • The Tony Elumelu Foundation has the seventh round of its entrepreneurship program in which, with partners, they are seeking to boost 1,0000 businesses and also assist others to recover from Covid-19. This year, 1,000 businesses will receive $5,000 in seed capital, business training, mentorship, and global networking opportunities.  Apply before March 31. 
  • edit The Visa Everywhere Initiative targets fintechs to join a global innovation program. Apply by May 7.
  • edit Nominations for the Africa Food Prize 2021 are ongoing, a $100,000 celebration of African agriculture achievers.