In the pool
Diving in: Another West African bank giant UBA follows Ecobank after apparently having secured a banking license to operate in Kenya.
Treading in the shallow end: Still finding their ground are the new Islamic Banks – Gulf African and First Community that started business last year. They are likely to be the only banks that will record losses of at least Kshs. 200 million each as their new branches and staff continue to reach out and educate customers on a new way to bank.
Had enough swimming?:
(i) Morgan Stanley who were supposed to introduce long term foreign investors to Kenya with a five year window or longer, but instead brought in short term investors at the expense of the Government and othrr investors who took out their profits in a week. Another lesson learnt a long way back from the IPO.
(ii) The Kenyan unit of Citi is on track to rake in profits of $50 million this year on the back of aggresive trading, but will it be enough, or will it be bled off by the parent unit? And who would buy it and its lucrative American interest-linked business portfolio?
About Sharia banking, I feel that anything that leans towards a particular religion is bound to under perform. This is because it alienates one half (or more) who do not subscribe to the particular religion.
I don’t know how successful the Islam banks are going to be in Kenya, seeing as we’re not predominantly Muslim.
The Morgan Stanley story is a real shocker.
It basically amounts to corruption.
But what was GOK doing? Shouldn’t Morgan Stanley have been contractually obliged to provide the right type of investor? At the very least, there should have been penalties applicable if their chosen investors bailed within a certain period of time.
I admit, I don’t know how these types of deals normally work or are structured but once you are parting with money in exchange for a specific service, it is up to you to determine your desired outcomes and design an agreement that compels your service provider to meet your goals.
Pink M: true point, but there must be demand because several including Barclays and KCB have opened Shariah wings. The trick is not to alienate your non-muslim clientele
Mystery Shopper: yes, at least the GoK auditor is aware, but like with so many past reports, will action be taken? The CMA shousl also note because the investors brought in are largely reponsible for the price dip therafter and soured the market mood
I do hope very strong action is taken.. Against Morgan Stanley but more importantly against those that were entrusted with looking out for the interests of the Kenyan taxpayer…They clearly failed us on very many levels.
With BBK and other existing commercial banks it’s bound to work because it eliminates the inertia on changing bankers for their muslim clientele. What I’m worried about are the exclusively sharia banks. The target market looks kind of narrow…
well… I have been highlighting how the safcon favored allocation was a rip-off for the ordinary Kenyan…
This vindicates those of us who resisted the foreign interest in the share. In fact, if you look at the NSE data, with the exception of principal shareholders, most other foreign investors are hot money carriers who are really messing up the NSE.
Though we do that ourselves with a lot of help anyway…
Mystery shopper:
Those who were entrusted to look out for the kenyan taxpayer? Pray tell, who do you mean? The MP’s who do not pay taxes themselves or the brokers who made millions in commissions from that IPO?
When it comes to your investments, nobody is looking out for you. You need to look out for yourself.
The game is rigged.
Mystery Shopper: D&B have become toxic advisors
Pink M: Gulf is off to a good start and it seems they are drawing in the customers and Shariah market share, but the other one is really struggling now
MainaT & Coldtusker: we asked for Warren Buffet and MS brought us Gordon Gekko
KE: there were general expectations that it would turn out well for Safaricom, brokers, the exchange, local investors, the diaspora, and foreign investors. Looking back, the foreign investor quotient let down the rest of the pack
I am betting on Sharia banks doing well. The other day I found that Gulf seems to be enjoying favourable reviews from small businesses in CBD particularly some ‘exhibition stall entrepreneurs’. apparently the credit process is ‘respectful’. on MS and Safcom, I recall this blog and Cold Tusker advocating for caution. Can’t say the signs were never there. What more protection do we want? Ningependa kuomba serikali …..
I doubt the foreign investor were all 100% foreign. No proof yet – but this whole Morgan stanley deal stinks of a scandal.
Ke:
GoK represents our interests in these matters.
GoK had to have a list of desired outcomes and it is up to GoK to ensure that all the agreements they enter into with any other parties guarantee that the desired outcomes will be achieved. Within GoK, there had to be teams and individuals working different aspects of the deal to ensure these desired outcomes were achieved.
They failed. Why? Each individual incharge of any aspect of this deal has to answer for any failure.
The report, “Another West African bank giant UBA follows Ecobank after apparently having secured a banking license to operate in Kenya”, portrays Ecobank as a West African bank. As the Head of Brand and Communication for Ecobank Kenya, this is a common misconception that I would like to clarify: Ecobank is not a West African bank. Rather we are a Pan African bank with a regional presence in more than 25 countries in the continent, and we continue to grow. Being a bank that uniquely identifies with the challenges in our continent and the potential within, one of our strategies is to ensure we continue to champion innovation within the industry as we grow. This year alone, we have received various prestigious awards recognizing our role in the banking industry within the continent and for being Africa’s most innovative bank. Currently we have a workforce of over 10,000 professionals from 29 different African countries, a sign that we are truly committed to remaining the continental institution that we really are.
I stand corrected, but its implied origin, in that Stanbic is a South African Bank and Barclays a British one
We all stand correction its amazing l knew very little about Eco bank people out here had a bad mentality about the west african misconception of eco bank and west africa and you can agree with me those bros from that end are not very good pepole to trust with your chums………….all the same lovely correction our minds are renewed by you …….. thanks
Jacqueline Abuga Ataya whats wroong it being a west african Bank i think its a good thing….bottomline is Ecobank is a good bank.