Equity Bank has been on a tear, signing deals with other banks for affordable lines of credit for on-lending. The latest ones are with the African Development Bank and FMO.
The recent financing agreements include:
In 2020:
September 2020: $50 million (Kshs 5.5 Billion) loan facility with the IFC.
October 2020: $100 Million from Proparco (Agence Française de Développement Group) to enable Kenya MSMEs, women entrepreneurs who had been particularly affected by the economic shock of the COVID-19 crisis to create jobs. It is expected to impact 240 MSMEs firms which will create over 5,000 direct and indirect jobs.
In 2021:
March 4: EUR 125 million (Kshs 16.5 Billion) loan facility signed with the European Investment Bank. The long-term loan will support Equity customer to sustain and scale their operations, with Kshs 6.5 billion to agriculture and Kshs 10 billion to MSMEs.
March 10: $100 Million (Kshs 11 Billion) facility with DEG of Germany, CDC Group of the United Kingdom, and FMO of the Netherlands to support MSMEs cope with COVID-19 over three years.
March 15: USD 75 Million (Kshs 8.25 Billion) loan facility with the African Guaranty Fund to lend to women-owned and managed micro, small and medium-sized enterprises in Kenya, Uganda, Rwanda and DRC.
March 23: $10 billion (Kshs 11 billion) from the African Development Bank to support its expansion into Central Africa. The tier-two facility with a 7-year maturity is also to support lending to women and youth entrepreneurs access capital to recover and thrive in a post-COVID environment.
March 25: $50 million (KShs 5.5 billion) NASIRA loan portfolio guarantee from Netherlands FMO, covering loans provided to MSMEs affected by the COVID-19 crisis, including women and young entrepreneurs and companies in the agri-value chain.
The findings of the 2020 African Financial Markets Index (AFMI) report were highlighted in Nairobi today for a year in which countries face economic and medical challenges from COVID-19.
The fourth edition of the AFMI report by the Absa Group and the Official Monetary and Financial Institutions Forum (OMFIF) now measures 23 countries that encompass two-thirds of the continent’s population and 80% of its GDP. The countries are ranked by six assessments of investment attractiveness and this year, Eswatini, Lesotho and Malawi were added to the Index.
South Africa remained on top, followed by Mauritius, and surprisingly Nigeria, which, along with Morocco, Ghana and Seychelles, made great strides to improve. Kenya, which was number three in 2019, dropped to number seven this year. Overall, 14 of the 23 countries scored above the median mark, a great improvement from the first index when only 6 of the 17 countries achieved this.
COVID-19 has had different impacts on African countries, but as Jeremy Awori Absa Kenya CEO said, even with the slowed-growth in the first half of the year, much was still expected from the continent that has a rising middle-class, and rising urban population. He added that growth would come from developing open, transparent and well-regulated financial markets.
Absa Economist, Jeff Gable said Africa cited some developments on the continent towards financial inclusion and making exchanges accessible to retail investors. These included Eswaitni’s automated trading platform and the Nairobi Securities Exchange’s revamped mobile app for retail investors with Dar es Salaam also working on a similar one. He spoke of moves to encouraging more funds to invest within the continent that saw Lesotho require its pension fund managers to invest locally (currently just 3% of assets are in the country), the launch of a derivatives market in Nigeria, and Ethiopia drafting legislation for a stock exchange.
In terms of sustainable finance, Kenya had its first green bond, Egypt had the first one in the MENA region, and Nigeria is working on its third green bond. Also, the African Development Bank was one of the first institutions to issue a financial instrument to fight the COVID-19 pandemic as it issued a $3 billion social-bond tranche.
Danae Kyriakopoulou of OMFIF spoke of Kenya’s drop which was mainly in the “access to foreign exchange” measure where which it was ranked tenth after having topped the pillar just two years ago. This was partly due to the perception of the currency exchange rate. And on market transparency, she said that Kenya has few firms that have global credit ratings, compared to Nigeria, South Africa, and Mauritius.
She added that a strong local investor base was a source of long-term capital and a financial markets shock absorber of volatility, and that Namibia has the highest pension assets under management per capita on the index. In terms of protection of minority shareholders, Kenya does well on that but it also needs to adopt enforcement of international financial master agreements (ISDA) as a key area of improvement. Kenya is also part of a pilot Africa Exchange Linkages Project to promote intra-African investment flows between the stock exchanges of Nairobi, Johannesburg, Casablanca, Egypt, Nigeria, Mauritius and the BRVM in West Africa.
George Asante, Head of Global Markets at Absa, said that the impact of COVID-19 was not as drastic on African financial markets as they had developed more resilience through having regulators work in uniform. This was in comparison to the 2008 global financial crisis which had a big disruption on African markets resulting in bond yields shooting up 30%. But he cautioned that African governments should work hard to remove the uncertainties that are still in the prices of their bonds, to attain lower borrowing costs in future.
The 2020 AFMI report by Absa Group and OMFIF can be downloaded here.
The abbreviated annual meetings of the African Development Bank (AfDB) Group ended this week after just three days, a slimmed-down virtual event, compared to the meetings last year in Malabo.
The Governors of the bank, representing 54 African and 27 non-regional member countries, dealt with statutory matters and approved the accounts of the bank for 2019, and reviewed its performance and the auditor reports. The Governors also commended the bank for its measures to work through COVID and while also providing flexible support to countries through the COVID-19 Rapid Response Facility of up to $10 billion.
During the year there will be a focus on infrastructure finance and quality health care and collaboration with the African Union and regional economic blocs to fast-track the African Continental Free Trade Area which was postponed from July this year, and will now kick off on January 1, 2021. Another initiative that will be supported will be the G-20 debt relief effort, recognizing that many African countries will go in to recession for the first time in twenty-five years as they tackle lockdowns, weaker tax revenue, and increased emergency health expenses.
The main highlight of the AfDB meetings was the election of the President, which saw Dr. Akinwumi Adesina re-elected for a second term with 100% of the delegate votes. The USA appears to have been the main opponent of his re-election, and their comments calling for the bank to ensure cost-effective management, review its use of resources and strengthen oversight & governance were contained in the final communiqué released by the Bank at the end of the meetings.
The next AfDB Annual Meetings are planned to take place in May 2021 in Accra Ghana. They will be hosted by the new Chairperson of the Bank, Mr Ken Ofori-Atta, Ghana’s Minister for Finance who took over from Ms Niale Kaba, the Côte d’Ivoire Minister of Planning & Development after she stepped down at the end of her term this week.
EDIT September 1: Dr. Akinwumi Adesina was sworn in to start his second term as President of the African Development Bank Group.
In just over a week, the African Development Bank Group (AfDB) will stage its 2020 annual meetings from Abidjan, Cote d’Ivoire which is the headquarters city of the bank.
The 55th annual meeting of the Group will run from August 25 to August 27. They had initially been planned to happen in May 2020. But because of the surge of coronavirus infections and travel bans across the continent, they were postponed.
The 2019 annual meetings were held in Malabo, Equatorial Guinea and saw thousands of guests, including Presidents, bank governors, finance ministers, and representatives of civil society, media, policy, and the private sector descend on the island of Bioko for a week of engagements.
But this year, as with all major global events, delegates will instead meet virtually and online. The 2020 meetings will feature a reduced schedule that will focus on closed statutory meetings of the Governors of the Bank who represent 54 African countries and 27-non-regional members of the Group.
A key agenda item will be the election of the President of the AfDB. Nigeria’s Akinwumi Adesina has served one term as President and is up for re-election. He is the only candidate, so far, and has the support of many countries including host Cote d’Ivoire and his native country. Last month he was vindicated by the findings of both a board investigation and an independent panel of international experts that investigated allegations in a whistleblower complaint.
There will also be the annual meeting of the African Development Fund, and some familiar sideline events, such as the African Banker awards.
Some notable nominees include the Access acquisition of Diamond Bank, the Airtel Dual Listing and the MTN Nigeria IPO for deal of the year (Equity) and the Access Bank green bond for deal of the year (Debt). Also the Acorn Green Bond, Nouakchott port financing, Port of Maputo, and the Tanzania standard gauge railway are all in contention for infrastructure deal of the year.
March 13: The Ministry of Health confirms the first case of coronavirus in Kenya on March 12 from a Kenyan citizen who returned to the country from the USA via London
March 22: Kenya confirms 8 new cases, bringing the total number to 15. It is tracing 363 other people and institutes a mandatory shutdown of major social activities in the country.
Banking Industry:
March 15: President Uhuru Kenyatta appealed to banks and mobile operators to reduce the costs of mobile transactions and calls on Kenyans to use credit cards, mobile money and other forms of cashless payments.
March 16: Safaricom waived fees for M-Pesa payments below Kshs 1,000 (~$10) for 90 days and raises M-Pesa transactions limits to Kshs 150,000 and also increases daily transaction caps and maximum mobile money wallet sizes up to Kshs 300,000 ($3,000). Airtel and Telkom Kenya follow suit a day later.
March 18: Bankers meet the President at State House where the Central Bank of Kenya (CBK) Governor announces that all commercial bank personal loans that were there in good standing on March 2, are eligible for extensions for up to one year while SME and corporate borrowers can approach their banks to be assessed for loan restructuring, with the cost borne by banks. Also, that banks would no longer charge fees for customers to check their bank balances.
Different banks announced their compliance with the new rules.
To support cashless transactions in battling the Coronavirus pandemic; we have waived fees on PesaLink, Account to Mpesa/Airtel Money transfers effective immediately. #StaySafepic.twitter.com/246yfRi0hz
March 19: The Kenya Bankers Association confirms that all banks will assist clients who come in to speak about how COVID-19 has affected their employment or business operations, and whose loan repayments were up to date as at 2 March 2020. They also ask all customers to observe 1-metre (or 3 feet) social distancing at branches
March 20: The CBK announces presents Kshs 7.4 billion ($74 million) to the Government to support the coronavirus fight efforts. This it says are the proceeds from the demonetization exercise that concluded in September 2019 and is the sum of (old) Kshs 1,000 notes that were not turned in and which the CBK had classified as being miscellaneous receipts.
Famous People in Quarantine
March 18: Senator for Kericho County Aaron Cheruiyot announces on twitter that he is in self-quarantine.
March 19: Members of Parliament and Parliamentary staff who arrived from London on March 9 are reported to be in self-quarantine.
March 19: Ambassador Macharia Kamau Kenya’s Principal Secretary to the Ministry of Foreign Affairs announces on twitter that he is in self-quarantine after returning from New York.
Following return from New York City on official business and the presidential directive on self quarantine I have restricted my movements and have taken up work from home. Today is Day 5 of 14. We should all do the right thing on self quarantine, monitoring &social distancing.
March 20: Jane Marriott, the British High Commissioner to Kenya announces on twitter that she is in self-quarantine, following her trip to the UK.
36 hours left of self-quarantine (staying at home), following my UK trip. ALL British Nationals should be following Kenyan Government advice and going directly home (not using domestic transport) after coming from a COVID-19 country. We're in this together. No one is exempt. pic.twitter.com/889ebukFVC
March 22: Kenya’s Cabinet Secretary for Health announces that Gideon Saburi, the Deputy Governor of Kilifi County, has been apprehended and put in a mandatory 14-day quarantine after he failed to isolate himself after returning from a trip to Germany. Also that he will be charged in Court after his isolation period.
March 18: Uganda announces immediate mandatory quarantine for arriving visitors, at their cost.
Ugandans returning home from countries with confirmed cases of #COVID19 will under go mandatory quarantine paid for by the traveler (for the duration of the quarantine). Those not prepared to meet the cost advised to delay their return trip in host countries.
March 21: Ethiopia announces mandatory for passengers arriving from March 23, at their cost. However, diplomats will be quarantined for 14 days at their embassies, while transiting passengers will be placed in isolation at the Ethiopian Skylight Hotel until they resume their connecting flights.
The mandatory quarantine will be effective on all arriving passengers entering Ethiopia after 12:00 am of March 23 (Monday morning). They will be placed on mandatory quarantine at the Ethiopian Skylight Hotel or Ghion Hotel for 14 days at their own cost. 1/2
March 22: Kenya has suspended all international flights other than cargo from March 25. Also, all arriving passengers will undergo mandatory quarantine at a government institution at their own cost.
Internal country shutdowns
March 14: Rwanda closes schools, places of worship, large gatherings, and asks people to work from home.
March 15: Kenya’s President announced the Government has closed all schools, suspended official foreign travel, and will encourage all employees to work from home.
March 18: Uganda closes schools, universities and bars, and bans weddings and religious services for a month.
March 21: Rwanda closes its borders to movement of people and cancels international flights, other than cargo ones. It also suspended tourism and research in 3 national parks where gorillas are found.
March 21: Nigeria shuts its airports to international flights as coronavirus cases reach 22.
March 21: South Africa closes its airspace to foreign travelers.
March 22: Kenya orders a suspension of religious services at all places of worship, closure of bars and bans gatherings including weddings, and birthday parties. Restaurants are to remain open for delivery services and funeral events are restricted to a maximum of 15 mourners.
Flight cancellations/ Airlines reschedulings:
March 17: Kenya Airways updates its schedule, reducing London flights to five times a week, Dubai & Johannesburg to once daily, and Johannesburg to two daily. It also suspends flights to Bangkok, Khartoum, Djibouti & Mogadishu.
March 18: Rwanda announces a halt to all commercial passenger flights into/out of the country on March 20 including operations of Rwanda Air for 30 days.
March 19: Kenya Airways suspends flights to Antananarivo, Bamako, Bangui, Blantyre, Brazzaville, Kigali, Kilimanjaro, Luanda, Yaounde/Douala, and Zanzibar.
March 20: Ethiopian Airlines announces 30 routes closures. The list is not revealed till the next day – and the listed countries include Egypt, Lebanon, Somalia, Djibouti, Namibia, Equatorial Guinea, Cameroon, Chad, Madagascar, Angola, Congo, Mali, Senegal, Rwanda, South Africa, Canada, Spain, Belgium, Switzerland, Indonesia, Israel and all US ones.
March 20: South African Airways immediately suspends all operations until the end of May following a government notice prohibiting the embarkation/disembarkation of non-SA crew and passengers. The only flights that will remain will be domestic service between Johannesburg and Cape Town.
March 22: Emirates announces cancellation of all passenger flights from March 25 .. but ..
March 22: Turkish Airlines to suspend most of its flights – leaving just a handful of flights to New York, Washington, Addis Ababa, Moscow & Hong Kong (via AlexinAir).
March 22: Kenya Airways suspends all international flights. Cargo flights remain, as will passenger services to Mombasa and Kisumu.
Corporate Restructuring’s:
March 13: Trading was suspended at the Nairobi Securities Exchange. This came following news of the discovery of the first coronavirus case in Kenya and the main share index dropped by over 5%. Past instances when circuit-et breakers have been tripped include in the period of post-election violence in 2008, and in September 2017, on the day that Kenya’s Supreme Court nullified the results of the August 8 presidential election.
The NSE wishes to notify market participants, investors, key stakeholders and the general public that trading at the NSE was halted on Friday 13, March 2020 at 2:38 p.m. pic.twitter.com/KXqQ83mgS3
March 13: Kenya’s insurance regulator, IRA, communicates that insurance companies will continue to provide their services to policy holders affected or infected with the virus .. but insurance companies say their re-insurers do not cover pandemics such as Coronavirus.
Kenyan regulator @ira_kenya seeks to assure the public that insurance companies will continue to provide their services to policy holders affected or infected with the virus. .. but insurance companies say their re-insurers do not cover this. #coronavirusinKenya
March 16: Ethiopian Airlines restructuring plans include scaling up cost-saving programmes and asking service providers for temporary relief, discounts and waivers. They have also started to renegotiate all contracts, including aircraft leases as well as scaling down offices and reducing staff.
March 16: Java adjusts seating and promotes delivery as do other restaurants. But many other restaurants closed.
March 18: The African Development Bank cancels all travels and requires staff to work from home. The Bank’s Board of Directors is reviewing the configuration and design of the Bank’s statutory Annual Meetings originally scheduled for May 26-29, 2020 in Abidjan.
March 18: Kenyan listed companies and licensed investment schemes that were to host annual general meetings (AGM’s) in March, April and May 2020 have been asked to defer them to later dates.
March 20: Kenya Airways CEO sends a memo to staff following COVID-19 and writes that in the last 24 hours, nine countries in our Africa network, the UAE and India have announced travel restrictions. So far, we have reduced approximately 65% of our flights, and this is changing by the hour. He announces that instead of layoffs they will ask staff to take salary reduction and paid & unpaid leave. The leadership team and he will take 75% and 80% respectively, while that for other staff will be 25% or 50% depending on the pay grade.
To facilitate supermarket shopping home deliveries, Tuskys has partnered with Sendy and Naivas has partnered with Glovo.
Government Adjustments
March 16: The Ministry of Lands closes all land registries for 28 days from March 17.
March 16: Kenya’s Sports & Culture Ministry closes all museums, archives, stadiums, public libraries, and cinemas for 30 days.
March 18: Kenya’s National Assembly and Senate both go on a month-long recess.
Both National Assembly and Senate adjourned for 30 days without enacting any emergency measures to help mitigate the economic implications of Covid-19! They were more preoccupied with self preservation than public interest! Bunch of cowards !
March 21: A thread to help those losing jobs their jobs this week and to help match their skills with part-time or remote-work opportunities.
Borrowing this idea: A lot of things are shifting right now in the tech enabled space. Some companies are laying people off while others are hiring to adjust e.g to a digital economy or to address last mile or to analyze data. If your company is hiring, please comment below.
March 22: The first shipment of medical relief equipment offered by the Jack Ma Foundation arrives in Africa for distribution to different countries. The total will be 500,000 test kits and one million masks had been pledged on March 13.
Thank you @JackMa & the @AlibabaGroup for sending the first wave of #COVID-19 prevention materials. Support includes 1.1million testing kits,6million masks & 60,000 protective suits to be distributed throughout Africa. Distribution to other countries will begin as of tomorrow. pic.twitter.com/tHsiwoWFjY
EDIT: March 2 2022: Two years after Corona’s outbreak, the Kenya Government hasalmost completely rolled back its restrictions and health measures – and tests will no longer be required for fully vaccinated travellers (but may be set by airlines and destination countries), masks are no longer mandatory in open spaces (but at crowded meetings & in palens), contact tracing has been stopped, and people can return to office work, while churches, public transportation and sports can resume at full capacity.THIS WAS FAKE NEWS
March 11 2022: With 17.8 million vaccines having been administered in Kenya, and a positivity rate of 1%, the Government announced a rollback of measures including facemasks will no longer be mandatory in open spaces, but people are encouraged to wear them at indoor venues, passenger transport can resume at full capacity, all quarantine is halted, sports spectators can resume attendance, churches and meeting can resume as long as people are vaccinated and the practice of taking temperatures at public entrances is halted. Also, all international travellers into the country will load data onto a Ministry of Health app, all unvaccinated travellers into the country must have a recent covid test result and will be tested at their own cost, while vaccinated truck drivers from East Africa will not require Covid tests. The measures were announced exactly two years since the onset of Covid in Kenya.
