Monthly Archives: April 2007

FLSE

Who need the LSE?

Safaricom is our birthright built on the voices, fingers, and shillings of Kenyans. It has been a model for social advancement, ability of ICT’s to bring development, empowerment, democracy, awareness, the long tail, proof that cents (and shillings) can grow into billions in profits – etc.

It is peculiarly Kenyan right down to its flaws such as congested hours, high costs, and secrets owners (Mobitelea). That’s why Safaricom should be listed on the Nairobi Stock Exchange, not the LSE

It is our birthright – like an African child who takes money out of their parents pocket for eighteen years and should put some back when they grow up. British shareholders will never understand how bamba 50, sambaza, mteja or m-pesa, translate into profits & dividends – nor should they be asked to.

The NSE was able to absorb Kengen and still left twice as much money on the table with negligible impact on other share prices. Likewise, it will be able to handle a Safaricom IPO.

Who’s Kenya paying?

A noble step in the war on corruption is this website by the Public Procurement Oversight Authority which list all contracts awarded over 5 million shillings ($71,430) by organs of the kenya government . A step further would be to require/ publish all companies who are awarded such contracts to also publish/disclose all the company directors.

Transparent dust
Mwalimu Mati is showing his former employers Transparency International quite a bit of dust with his new venture Mars Group Kenya which unearths more dirt than Transparency ever did.

Easter weekend

No trades
I realized that I had not been to my stockbroker’s office to trade this year. It would be good to visit to find out the fate of my Stanbic shares. I’m not sure if I got a full allocation or a refund since I have not got any report from the broker. This week would be a good time to visit before the lines begin for the Access Kenya IPO which starts next week.

Access Kenya IPO
Access Kenya announced that their IPO will begin on April 19th. The company hopes to sell 80 million shares at 10 shillings ($0.14) each to raise 800 million shillings ($11.4m). I look forward to the prospectus to be released within the next few days to give a proper picture of the communications market. And we are also awaiting an IPO from Wananchi, Kenya’s largest ISP who unfortunately lost a bid for Africa Online to Telkom of South Africa.

The ISP industry has shown tremendous growth, but the sector faces additional challenges for investors.

  • First like the Scangroup IPO, intangible measures take on greater significance in comparing the company against its peers and its future prospects.
  • Second, an additional regulator comes into play i.e. the Communications Commission of Kenya. The sector has seen some turbulent investments that have not reached fruition including the third mobile operator (Econet in court for three years) and the second national operator (license has been awarded and canceled twice). Also CCK will in future move towards giving unified licenses, which means that companies won’t have to go back to re-apply each time they want to introduce a new service.
  • Third in a unified license world, and once a restructured Telkom has been sorted out, Safaricom and Celtel may be the ISP companies of the future with their EDGE / GPRS offerings. (ISP’s are already complaining about mobile companies not playing fair with interconnection, leading back to the regulator again).

Corporate divorce
Alexander Forbes of SA has withdrawn its name from Alexander Forbes insurance brokers of Kenya citing a lack of majority equity or management control. The Kenyan operation (formerly Hyman Robertson) who already have a new name ready to launch, feel that they have been good custodians of the brand, turning it around from loss-making one to being one of the largest in East Africa.

Fading libraries?
Read in the Sunday Standard that the British Council was closing their library in Mombasa owing to declining memberships.

Kenya Bank Rankings in 2006

Barclays still rules at the end of 2006

figures in Kshs. millions

Bank assets 2006
change from 2005 rank in brackets
1. Barclays 118, 021 (Kshs 118 billion or $1.69 billion)
2. Kenya Commercial 87,326
3. Standard Chartered 81,014
4. Co-operative 57,683
5. (6) Citibank Kenya 37,794
6. (7) Commercial Bank of Africa 37,507
7. (5) National Bank of Kenya 36,123
8. (9) NIC 26, 108
9. (12) Stanbic 25,822
10. (8) CFC 25,392
11. (10) Investment & Mortgages 22,348
12. (11) Diamond Trust 21,564
13. Equity 20,024
14. (15) Baroda 11,773
15. (19) Prime 10,452
16. (17) Imperial 9,406
17. (14) Housing Finance 9,142
18. (16) EABS 8,910
19. (18) Bank of India 8,702
20. Fina 6,502
21. Bank of Africa 6,488
23. (22) ABC 5,357
24. Habib AG Zurich 5,323
25. (30) K-Rep 5,220
26. (23) Giro 5,098
27. (25) Guardian 4,917
28. (27) Southern Credit 4,580
29. (28) Victoria 4,284
30. (37) Chase 4,123
31. Equatorial 3,962
32. (33) Consolidated 3,437
33. (29) Middle East 3,401
34. (36) Development Bank of Kenya 3,297
35. (34) Habib Bank 2,963
36. (35) Credit 2, 610
37. Transnational 2,566
38. Fidelity 2,316
39. Paramount Universal 2,197
40. Oriental (formerly Delphis) 1,449
41. Dubai 1,248
42. City Finance 527
========
Notes
22 (32) Family Finance 5, 469 was not been licensed as expected
Charterhouse Bank was de-licensed in 2006

Pre-tax profit
Barclays 6,624 ($94.6 million)
StanChart 3,810
KCB 3,035
Citibank 1530
CBA 1,311

Return on assets
Barclays 5.61%
Equity 5.51%
Family Finance 4.83%
StanChart 4.70%
I&M 4.19%
Imperial 4.11%
Citibank 4.05%

Deposits
Barclays 93,837
KCB 71,495
StanChart 64,879
Co-op 48,201
CBA 32,517

Loans
Barclays 73,907
KCB 40,659
StanChart 35,762
Co-op 28,037
NBK 26,491

Branches
estimated
KCB 110
Postbank 66 (not a bank)
Barclays 53
Equity 42
Co-op 40

Staff expenses
KCB 3,823
Barclays 3,057
Co-op 2,081
StanChart 1,781
NBK 1,204
Equity 943

Loans to deposits
City Finance 183%
DBK 117%
K-Rep 114%
Transnational 103%
Dubai 93%

Government friendly banks
ratio of government securities investment to loans
Habib AG Zurich 210.46%
Habib Bank 195.07%
Baroda 140.66%
Bank of India 138.15%
StanChart 77.32%
Citibank 69.54%

Raking the Fees
% of income from non-interest (lending) sources
Oriental 60.49%
EABS 56.66%
Equity 55.27%
Paramount Universal 53.76%
Family Finance 53.11%
Co-op 51.35%

Related

– Earlier in depth review, analysis, and projections.

– 2005 rankings.

Chinese rescue Tiomin

Jinchuan Group Ltd of China will invest $9.4 million Kshs 640 million) in Tiomin by purchasing 72.5 million shares of the company (increasing their stake to 20%) and the improved cash posiiton will enable the Kwale project to go on.

See earlier project delay.