Category Archives: NSE investor awareness

Kenya Green Bonds Launched

A few days ago saw the launch of green bonds in Kenya with the signing of a memorandum of understanding between the Kenya Bankers Association, Nairobi Securities Exchange (NSE) and Financial Sector Deepening Africa (not FSD Kenya). Through this, they hope to deliver lower cost funds through capital markets to finance green projects. China is actually the leader in this along with India, but Kenya, as part of a climate bonds initiative, will be the flagship for green bonds in Africa.

NSE CEO Geoffery Odundo NSE Odundo said green bond listings at the NSE would attract impact investors while Kenya Bankers Chairman, Lamin Manjang said they hoped the first green bond would list at the NSE this year. FSD Africa has committed $600,000 to this and the IFC will partner with KBA to determine green portfolio i.e. projects that quality for such finance, from sectors such as energy, agriculture, infrastructure, transport, manufacturing. Other actives to be undertaken include and enabling small banks to take part in financing the pipeline, extending green bonds across East Africa, creating a pool of Kenya green finance experts, and promoting green Islamic finance.

More on renewable energy project finance in Kenya.

Kenya Fintech Tools for Youth

A rundown of local fintech tools for phones available in Kenya, both from banks and non-banks. Most don’t give you much access to all their features till you register and It’s not clear where the user data for some of them ends up. They are mostly there for android phones, less so for iPhones. Take a spin, and share feedback if you have used them.

Non Bank One’s

Abacus helps novice or pro traders, understand and trade at the Nairobi Securities Exchange.

From CIC Group comes Bima Credo with which people can get life insurance by buying and using airtime credit. This enables consumers to pay for their life insurance premiums in affordable amounts and as part of their daily mobile airtime usage.

Mula: (Android only) is a bill payment service from Cellulant. One can pay all bills in one place, and track past payments, pay for Nairobi City parking and buy items for friends on any network. You will never forget a (recurring) bill, as Mula is fully integrated with Safaricom’s M-Pesa API so this means no copying and pasting transaction details. All you have to do is accept or decline the transaction. Another review by Moses.

M-Shwari Take part in the #52WeekChallenge With M-Shwari that locks savings and one will be able to save Kshs 68,500 ($685) a year, a handy sum, just by small periodic installments.

Open World has Open Business, a point of sale app for small businesses. They can use it to track sales and inventory in real-time. No long-term contract is required, just Kshs 500 (~$5). The app is a bottom-up fintech tool for SMEs that will enable data based lending from banks and alternative lenders.

The Safaricom App now comes with M-PESA functions and can be downloaded to Android and iOS smartphones.  The app enables customers to select contacts from their phone when sending money and customers. Aside from that, merchants will also enjoy faster payments through Lipa Na M-PESA to their accounts at 23 banks ..this will cut down the time that it takes to move money from a Lipa Na M-PESA till to a bank account from as much as 28 hours down to seconds.

Uhasibu has payroll which simplifies payroll management, including statutory payments to a half-dozen government agencies that businesses have to make every month, and these include different taxes. Another review by  Moses.

Zeep (Android): Enables teens to learn finance in a secure environment. Their parent/guardians register (*823#) then also link and register to their children/ beneficiaries/ dependents numbers. They can use the app to make payments for NHIF, land rates and business permits. They can also allocate weekly amounts to teens and watch as they pay for utilities and other bills.

Bank One’s

CBA has Loop which is geared toward the young hustler or someone who needs banking for a side gig. Tagged as unbank yourself, users, once they register and get a debit card, can pay bills and categorize items to spend on and track these against set budgets e.g. see how much they spend on food & dining., transport ( Uber) , or rent. The can also check balances, and see a financial snapshot at any time. Another review by Macharia.

Equity has Eazzy banking platform from Finserve. One can store billing details to pay after and also send money securely to another phone or bank account, pay for goods and services, buy airtime for EquiTel and other networks. One can also set and save for a goal, send money to favorite people (contacts on whatsapp, twitter, facebook) and apply for loans instantly of up to Kshs 3 Million (~or $30,000)  and track NSE shares.

Stanbic has a Kidz banking app (available in South Africa) – an educational and fun app that teaches children how to save and manage their pocket money. Kids earn money when they complete their chores and can save towards goals while parents get to approve payments, set and monitor tasks, etc.

Other banks like Coop and KCB have accounts tailored for children and young adults with extras such as book & uniform discounts and education & insurance policies, but it would be nice if they added financial education tools and apps dedicated to those bank accounts.

Two Rivers Development Bond

Peek at the Two Rivers bond prospectus

This week Centum investments announced a Kshs 2 billion one year 14.5% note for the Two Rivers Development Limited – which is 58% owned by Centum, 39% by Avic, and 3% by ICDC.

Two Rivers had a facility of Chase Bank to finance infrastructure developments, which they had drawn on partially when the bank closed. They also had Kshs 650 million of deposits at Chase.

Two Rivers owns 50% of Two Rivers Lifestyle Centre and 100% of phase two of Two Rivers, apartments, and offices. 50% of the mall, the largest in Sub-Saharan Africa (i.e. outside South Africa) which opened on Valentines’ Day was sold to Old Mutual in 2015 for Kshs 6.4 billion. Two Rivers Development was valued at Kshs 41 billion in March 2016.

To pay for the retirement of the bond, they are selling 11 plots of land (some residential, some mixed use, one for a hotel) which have a combines market value Kshs 6.6 billion, and a mortgage value of Kshs 5.6 billion. Interest will be paid at maturity, and the note is guaranteed by Centum Investments.

The Centum investor briefing (PDF) for 1Q2107 identifies education, leasing, and agribusiness as key areas of growth at Centum in the future.

$1 = Kshs 103

Chase Bank EOI 

Yesterday the Central Bank of Kenya (CBK) invited new investors to express interest in buying into Chase Bank as they also extended the management period of the bank by another six months. When the CBK governor met depositors last November, he indicated that he hoped that the deal would be concluded by the first anniversary of the closing of Chase Bank (April 7), but that has now been pushed back. Last week, the Governor also said that nine banks were interested in opening shop in Kenya.
  • Following the receipt and evaluation of EOIs, a shortlist of qualifying investors (“Shortlisted Investors”) will be granted access to a haseomprehensive confidential data room to develop a formal proposal to acquire Chase Bank (Kenya) Limited. The Shortlisted Investors will be determined in a fair process using appropriate and objective criteria based on, inter alia, regulatory imperatives and prudential guidelines which will ensure a speedy and optimal recovery for depositors, creditors and other stakeholders of Chase Bank (Kenya) Limited, whilst also mindful of seeking to preserve and develop a sound and innovative banking system in Kenya.
  •  The deadline for applications is April 21, and CBK has appointed KPMG as its advisors in this process. EOIs should include the following key areas: Interest in banking in Kenya, ownership details, management skills, adequate capital, financial resources, liquidity availability and the proposed transaction structure. 
  •  No information beyond what is already available in the public domain will be made available to interested parties and there will be no question and answer process at this stage.
  • Following the receipt of EOIs, shortlisted Investors will also be granted access to a “Data Room ” to develop their investor proposals (from May 3)

NewGold ETF Debuts at the Nairobi Securities Exchange

March 27 saw the listing of 400,000 gold bullion debentures, via NewGold, an exchanged traded fund (ETF)  at the Nairobi Securities Exchange. NewGold is represented by Barclays Financial in Kenya. It is incorporated in South Africa and is also listed on stock exchanges in Botswana, Nigeria, Mauritius, Namibia and Ghana. The listing will be equal to these previously issues ones.

The NewGold ETF tracks the value of gold bullion and will be the Kenya shilling equivalent of the international market price of gold. Selling of NewGold will not attract capital gains in Kenya. Also in March 2008 NewGold got approval in South Africa for being shariah compliant with Islamic principle of ethical investing “NewGold and NewPlat ETFs open the way for Muslim investors to gain exposure to precious metals – gold and platinum – through investing in a listed ETF.”

NewGold listed at the Johannesburg Stock Exchange in 2004 and “since launch NewGold has grown rapidly, attracting over R21 billion investment, due to its healthy returns. It is the largest ETF listed on the JSE

Notes from NewGold

  • JSE Code GLD: GLD are designed to track the spot gold price less management fees
  • ISIN ZAE000060067
  • Gold Entitlement Approximately 1/100th one fine troy ounce of gold.
  • The Underlying Assets: Allocated Gold – all gold is kept in the form of 400 oz London Good Delivery Bars. The gold is kept in an allocated form, and as such does not carry third party credit risk
  • Absa is the originator, Barclays is the sponsoring broker, and Mboya Wangongu advocates are the legal advisors.