Barclays Bank of Kenya held its annual general meeting on Friday morning. I arrived at KICC at quarter to 11, which I figured was enough time for the registration process – perfect – I entered the Hall at 10:59 and the AGM started at 11 a.m. sharp – finally, a public event that begins on time – with a minute’s silence for the Pope.

Out-going Chairman: Today’s AGM turned into a love-fest as grateful shareholders bade farewell to Chairman Sam Ambundo. He joined Barclays in 1948 (57 years ago) as a clerk at the Nairobi branch, earning 83 shillings and rose through the Bank to the top – as General Manager. After resigning from there, he then joined the Board and has served for 22 years, with the last 9 as Chairman.

Barclays runs a tight ship: The Chairman stopped shareholder questions that veered-off topic and voting was by “show of hands” acclamation (KANU style) even the election of directors. Unlike at the annual Kenya Airways meeting, there were no alternates – i.e. outside people seeking to join the board. Directors and auditors are re-confirmed in a matter of minutes, as shareholders appeared unsure of their rights, or were unwilling to rock this very profitable boat.

Ghost of Matiba: The first two shareholder questions to the Board, asked why Barclays was persecuting and torturing Matiba by trying to sell his school and hotel properties. These early questions were deferred to a later session. But even as the Chairman mentioned that he could not comment about a matter that was in Court, he was adamant that money advanced as loans to borrowers, must be rapid since it belonged to depositors and that shareholders would bear the brunt if such loans were written off. Barclays MD, Adan Mohammed, also stressed that the Bank typically sells someone’s property strictly as a last resort, and only after all other options of repayment have been discussed with the borrower. i.e. Matiba’s Group have been difficult customers.

Other questions:
Shareholders asked:

• For bonus shares to be given instead of dividend.
• Called for a special dividend of 22 shillings to recognize the Chairman’s 22 years on the Board.
• The Bank to support St. John’s ambulance.
• The Bank to buy a bicycle for the retiring Chairman
• How does one process dividends of shareholders who have died?
• Best question: Pointed out that 10% of Barclays loans are non-performing (i.e. may turn bad and never be repaid) and this was confirmed by the Chairman. However, Barclays is doing quite well, given than the average amount of non -performing loans in the Kenyan banking sector is about 25%.

The Chairman put a halt to questions of a personal nature (and which usually are the most entertaining)

In-coming Chairman: Francis Okomo Okello was presented as the new Chairman of the Bank and proceeded to give a long winding speech – he spent about 5 minutes introducing his speech, then used about 19 big-worded adjectives such as “disarmingly modest, persuasive debater, insightful, perceptive, indelible footprints” to describe his first meeting with Chairman Ambundo some 10 years ago. Chairman sat there with an embarrassed grin on his face as some directors took catnaps during the 30-minute speech and most shareholders counted the minutes to lunch. Also, while the Ambundo had kept repeating pertinent matters into Swahili, Okello made no such effort and stuck to his written speech. The poor speech was made more glaring, given that the Adan Mohammed, had just given an impromptu and witty brief speech about the Chairman a few minutes before.

Still, there’s hope: Bill Clinton’s first major appearance to the American public was a long boring speech he gave at the 1988 Democratic National Convention that appeared to doom his chances of leading the party – and yet 4 years later he was his party’s candidate and President-elect. For Barclays, by next year, Okello should have a competent personal assistant to review his speech beforehand and he’ll also be more comfortable performer in front of shareholders.

Barclays is a model company: The best-ranked companies in Kenya are all lean and efficient operations – Barclays has 1,800 employees, Safaricom has 700 and Kenya Breweries has 1,000 (down from 6,000 about ten years ago) – Compare this to government departments that employ tens of thousands of workers

Best moment: When Chairman Ambundo presented senior managers of the Bank to the audience – they were all young, Kenyan (miro’s)men and women – the future and succession planning at Barclays is assured. I.e. Okello was named vice chairman last year, and Ambundo groomed him to take over the Chair this year. Also during the meeting, MD, Adan Mohammed, also announced that he aspires to rise from management to be the Barclays Chairman one day – as Ambundo did.

Worst moment: Cheap Blue Chip: The richest Bank in Kenya had a very stingy AGM – compare this to other AGM’s where directors sit and eat a sumptuous lunch with shareholders who also receive gift bags, t-shirt’s umbrella’s, company products etc. Lunch was a bit of a let down – after lining up for 20 minutes at one of the four lines, I got my lunch box which consisted of egg, banana, cake, sausage, samosa, and a piece of chicken with a bottle of soda or water. Despite giving a healthy dividend of 14 shillings, Barclays should do more for shareholders – as they only meet once a year.

Lesson of the Day: Buy Shares: Barclays has 33,000 shareholders – 11,000 of whom own less than 500 shares. Most of the shareholders who attended the Friday AGM were rural, elderly folk – who looked like retirees, many of whom didn’t speak English – but they all made a decision to buy shares.

If someone had invested 1,600 in 1986 when Barclays launched on the Nairobi Stock Exchange, those shares would be worth over 230,000 shillings today. Plus, over the last five years, they have received dividends of 14 shillings a share, except 2002 when it was 12 sh. per share. Barclays even pays dividends when its earning drop – as in 2000 the bank earned 11 sh. per share, it paid a 14 sh. dividend, while in 2002 it paid 12 sh. on earnings of 10 sh. per share. I.e. owning 500 shares gives you a cheque of 7,000 every year for the last five years, and in some years