Kenya Bank Rankings 2013 Part I

Ranked by assets (and placing in 2012)
                   

1 (1) KCB [Assets of Kshs 323 billion ($3.80 billion), and profits of Kshs 17.74  billion ($208 million)]
2 (2) Equity
3 (3) Cooperative
4 (4) Standard Chartered
5 (5) Barclays
6 (6) CFC Stanbic
7 (8) Commercial Bank of Africa
8 (9) Diamond Trust
9 (7) NIC
10 (10) Investment & Mortgages [Assets of Kshs. 110.3 billion ($1.3 billion), and profits of Kshs 6.05 billion ($71 million)]
11 (12) National
12 (13) Chase
13 (11) Citibank
14 (14) Bank of Africa
15 (15) Baroda
16 (16) Prime
17 (17) Housing Finance
18 (20) Family
19 (18) Imperial
20 (19) Ecobank
21 India
22 Guaranty Trust (formerly Fina)
23 ABC
24 Consolidated
25 Gulf African
26 Development Bank of Kenya
27 Equatorial
28 Victoria
29 Giro
30 K-Rep
31 Guardian
32 Fidelity
33 First Community
34 Habib AG Zurich
35 Transnational
36 Habib
37 Paramount
38 Credit
39 Jamii Bora
40 Oriental
41 Middle East
42 UBA
43 Dubai [Assets of 2.92 billion ($34.4 million)]

Huduma: The Bank Branch of the Future?

A visit to a Huduma centre showed that a shared building or hall where different banks serve their customers  may be the future of the bank branch. 

Despite new mobile, ATM, and internet channels, customers still need to come into bank halls quite a bit, as seen by the queues at beginning and end of each month. A lot of this is because customers need to bring and and remit payments that end up going to other banks either via direct deposit, cheques, or RTGS. Does the money need to physically move? No But the customers do, going from building to building to do single transactions at many banks. 

It helps if you have a place like Sarit centre which is an banking attractive destination because it has so many bank branches under one roof, with many more in adjacent buildings.
 
Can banks share a hall like a Huduma one, and second some staff there to serve their customers in such a centre?. This way they can share the cost of security, which can be handled by armed guards outside, and leave a friendly customer interface inside that is devoid of bullet-proof glass (like some Uganda bank halls)
Every bank that has a branch network incurs a repeat of the same costs of staff, security, cash handling, advertising signs, stationery  etc. They also have building leases, insurance, and fees per branch or outlet  – such Kshs 65,000 or $765 per year for an ATM license in Nairobi County.
Big banks have invested in big branch networks, but can smaller banks share halls in new neighborhoods or towns like Eastleigh and Kiserian that experience rapid growth, and the banks have to catch up. Shall we see a bank hall or post office hall in such a place with 20 desks, and 20 sets of staff for 20 different banks?

There are some signs of this coming:

  •  One is the precedent that Kenswitch set, in which about two dozen small banks and financial institutions got together to share an ATM network that their customers can all use. 
  • Another example is large hardware, pharmacy, and agro-vet stores in rural Kenya that  simultaneously act as agents for several banks (which they can do as bank agents, but not mobile money agents). 
  • Another is the trend of Nairobi malls grouping as many bank ATM’s in one area e.g. at Galleria and Junction malls. There is no true saving yet as each bank still has an idle security guard to ‘look after’ their machine.

Understanding Low Cost Flights

Though FastJet and JamboJet applied at about the same time for aviation licenses to fly in Kenya, FastJet started in Tanzania in November 2012, and a year and a half later,  JamboJet, a Kenya Airways subsidiary has launched flights in Kenya. 

As low-cost carriers, there are some differences which passengers here, especially current Kenya Airways customers, may not be able to understand.

  • Cost of tickets:  Going by the FastJet model, which JamboJet also has, there is the  unique pricing of tickets. While they advertise low prices of tickets e.g.Kshs 2,850 ($35) to Mombasa, Eldoret and Kisumu, not all seats on the flight cost that. The price applies to just a few and as soon as they are bought (preferably several days or weeks in advance of a flight), then the next batch of seats becomes available, at a higher rate. This goes on until fares bought on the day of the flight might be comparable or even more than the cost of a full-fare airline. 
  • Extras: Next is that the airline makes money on many extra items – things that you take for granted on Kenya Airways, are items you pay for on JamboJet; these include luggage (only 10kg  hand luggage is free), meals (Kshs 500 for a sandwich, and Kshs 200 for a soda) and even seat selection (costs Kshs 710 to pick a specific seat that’s tinier than a Probox as per @themacharia).
  • Children: On FastJet international routes, children aged less than 12 years are not allowed to travel unaccompanied. But on JamboJet domestic, this is allowed at a fee and the child must be met by a parent/Guardian within 20 minutes after arrival or additional fees will be charged.
  • Luggage: With JamboJet, a passenger is allowed to purchase a maximum of 64 kg of checked-in baggage. The only free baggage is the 10 kg hand luggage. Also, it is cheaper to pre-book and pay in advance for baggage than pay at the airport.  On FastJet, a passenger can pay for excess weight at a rate of $5 per kg up to a maximum of 32 kg.
  • Delays: If a FastJet flight is delayed by 1 – 2 hours, the airline will provide regular communication on flight status, and if the delay is 3 – 4 hours, refreshment vouchers of up to  Tsh 8,000 ($5) may be provided. If over 5 hours delay, FastJet will communicate a flight cancellation and refunds will be issued from the head office or  there will be a free transfer to (their) next available flight. So if a flight is canceled for operational, weather, or other reasons, the T&C states that FastJet will not provide flights with alternative airlines or hotel accommodation in the event of overnight delays or cancellations.
  • Changes All fares are non-refundable. On JamboJet, itinerary changes must be made 1 hour prior to departure –  and if at the time of change, the original fare is not available, the passenger will pay a higher fare 
Also, in other markets, low-cost carriers operate from smaller airports which have lower landing fees or taxes. In Kenya, an equivalent would be flying from Wilson airport or Orly Air Park as opposed to JKIA.

For now, JamboJet operates on relatively short flights to Kisumu, Eldoret and Mombasa so you won’t notice that there’s no free meal service. JamboJet also has permission from the Kenya government to fly to Wajir, Malindi, Lamu, Juba, Hargeisa, Kisangani, Pemba, Moroni, Entebbe, Dar es Salaam, Mwanza, Bujumbura, Kigali, Dzaoudzi, Goma, Mwanza, Antananarivo, Zanzibar, Kilimanjaro and Addis Ababa.  Over in Tanzania Fastjet flies to Mbeya, Mwanza and Kilimanjaro, and also flies to South Africa and Zambia.

Visit a Huduma Centre

Arguably, the President was probably wrong when he said during a TV interview on the one-year anniversary of his government, that their biggest achievement was free maternal health care.
 
A better answer was probably their introduction of Huduma (Swahili for service) Centres in the country. Huduma Centres, which are at two post offices in downtown Nairobi, are offices where citizens can access a whole range of government services that they would previously have to visit a dozen different  offices over several days to complete.
Services offered in one room include business registration, driving license renewals, national ID’s, birth certificates,  city parking permits, land rate payments, querying NSSF & NHIF, and they even act dropping points of KRA (taxpayer) forms. 
 
They are popular and the parking at one had several red-plate (diplomatic) cars outside as vehicle log book collection is one of the services offered.
 
One Huduma Centre had a few important things that made the visit to this government office pleasant including: 
  • A ticketing system and customer service person at the door to get you to the right queue quickly. 
  • In case you need more cash, there is a mobile money agent (both M-Pesa & Airtel)
  • A cyber cafe inside in case you need to print documents or make an (inevitable) photocopy.
  • Free parking for customers.
Huduma Centres are pleasant, and airy, and served by smiling staff that make you want to get more and more essential services completed when there. 
 
Going forward, will this good feeling last? Will departments continue stop supporting services here? Will parking remain free? Will the staff get tired of smiling as crowds grow? Will the quality of service deteriorate over time? Can it scale to other towns? 
 
That remains to be seen but for now Huduma Centres which enable citizens to access several individual and business services in one time-saving office is the most important government achievement to date. 
 
The Huduma Kenya website notes that additional centers will be opened in each of the 47 counties within the next 24 months. And as the government grapples on how to revive post offices that it owns in prime locations around the country (in an electronic age with fewer letters), Huduma Centres may be the answer.

Boeing 787 Dreamliner Arrives at Kenya Airways

On April 5, Kenya Airways (KQ), received The Great Rift Valley – their first Boeing 787-8 Dreamliner aircraft in Nairobi.  

KQ’s new B788 arrives

KQ Managing Director, Titus Naikuni, said their aircraft were 3-4 years behind schedule and thanked the airline staff, passengers and salespeople for putting up with older aircraft in the interim. He added that plans are still on course for KQ to get more Dreamliner planes every month between June till October 2014. KQ Chairman, Evanson Mwaniki who was onboard the 16-hour non-stop flight from Paine Field, Washington to Nairobi, said they been assured at the highest levels of Boeing that the 787 program’s teething problems had all been sorted. He said each Dreamliner with engines cost the airline Kshs. 11 billion (~$130 million seems low), while the new Boeing 777-300’s arriving were Kshs 18 billion ($211 million) and yet they are competing for routes with Gulf nation carriers with seemingly unlimited pockets who could order 100 aircraft while KQ ordered 9.  He made three requests of the Government; to expedite bilateral air service agreements, sort out double taxation that penalizes the airline and also expedite VAT refunds.

Tracking the Great Rift Valley

Transport Cabinet Secretary, Engineer Kamau said the government of Kenya and KQ had worked on new terminals (Greenfield started, Terminal 4 ready in July), and new aircraft (777, 787) and invited the President to use Kenya Airways for trips and for KQ to use the President who travels a lot and get themselves on his agenda for such trips. 

Also at the launch was the President of Somalia, Hassan Sheikh Mohamoud, who said terrorism was a global challenge and that, while Shabaab was associated with Somalia where it gained a foothold in the then-lawless state, it is now losing ground in terms of financing, recruitment, and training. He thanked Kenyans for their tolerance and accommodation of business people and said Somalia was on track for a first election in 45 years in 2016 in which women would also vote. 

President Kenyatta said KQ had more of a global reach than Kenya embassies so was in essence first ambassadors for the country and that in his personal experience it had the best pilots and crew in the world. Later he noted that pilot costs are heavy, and that KQ’s labour is less productive than Ethiopian Airlines and that it was necessary for the airline to simplify operations and get better staff productivity.  He also said that Angola had agreed to open an embassy in Nairobi  – a relief to many as Kenyans applying for visas have to do so via Dar es Salaam, Tanzania. 

Engine cool-down after the extra long flight

The new aircraft is part of Project Mawingu, the airline’s massive fleet, and route expansion program. It will start on the Paris route in June and in between will be used for familiarization of staff, training, and be showcased to key KQ markets.  At the launch, a General Electric representative thanked the airline for having over 100 of their engines in the fleet, while a Boeing VP said KQ had designed and selected one of the best Dreamliner interiors on offer.