Category Archives: IMBank

Bank Review ’07: Part III

Middle of the pack

20. (20) Fina Bank: Estimated assets of 7.6 billion ($108 million) and profits of 90 million shillings ($1.3 million), with growth of about 20% from a year ago. Opened upcountry branches in Kenya (Nakuru, Mombasa, and Eldoret) and will start branches in Uganda next year, bridging the Fina to their existing Rwanda operations.

19. (22) Family Bank: Estimated assets of 9 billion and profits of 220 million in 2007. Known as Equity Blue, it has enjoyed similarly rapid growth (though slightly less this year) since converting from a building society to a bank. It has followed Equity’s footsteps, applying for the same exemptions granted to Equity – such early as admission to the clearing house and permission to issue chequebooks. It has also opened branches at a fast rate and its paperless banking model and women-entrepreneur loan models are a hit with rural Kenyans. But, in the year in which they converted to a Bank, they also lost their long serving CEO over board dispute and got sued by a Central Bank official who their Chairman had accused of being corrupt.

18. (18) EABS: Estimated assets of 9 billion and profits of 15 million. Teething pains continue at the former building society which converted to a bank three years ago, and had growth of about 5% in 2007.

17. (17) Housing Finance : Estimated assets of 10.5 billion and profit of 120 million, with loans 15% up from a year ago but assets only 2%. The bank tried to merge with Development Bank of Kenya, and later raise cash in a rights issue, but both plans were scuttled by regulators; later the board signed to sell a 25% stake to Equity Bank. HFCK and S&L (owned by KCB) are still major players in the mortgages sector which is becoming a crowded field with newer entrants Stanbic and Standard Chartered. HF also lost a class action lawsuit filed by customers over illegal bank charges.

16. (19) Bank of India: Estimated assets of 11 billion and profit of 500 million for quiet bank that grew at about 25%. Does a lot of India related business and Kenya government securities.

15. (16) Imperial Bank: Estimated assets of 11.5 billion and profits of 600 million. In 2007, the bank grew about 40% as it launched shariah banking, asset finance, children’s accounts and opened new branches at the coast.

14. (14) Bank of Baroda: Estimated assets of 14.9 billion and profit of 600 million for quiet bank that grew at about 25% and does a lot of Kenya government securities investing. It has been in Kenya for 52 years

13. (15) Prime Bank : Estimated assets of 15 billion and profits of 350 million. The fast growing bank will consolidate with affiliate Prime capital company by year end leading to a much larger bank in 2008.

12. (11) Investment & Mortgages: Estimated assets of 30 billion and profits of 1.3 billion. Fast growing bank also diversified into shariah banking, custodial services and also acquired two new euro bank shareholders.

11. (12) Diamond Trust : Estimated assets of 31 billion and profits of 950 million. In 2007 the bank grew about 45% as it opened several new branches, had a second rights issue in less than a year and also acquired a majority stake in Diamond Trust Tanzania.

10. (8) NIC: Estimated assets of 34 billion and profit of 1.1 billion. The bank grew at about 30% in 2007. It had a rights issue, rewarded shareholders with a bonus, went into custodial and investment banking (acquiring a stockbrokerage firm). But the market leader in asset finance also faced increased competition from other banks in this field and was dropped from NSE share index in favour of ICDCI.

9. (5) Citibank Kenya: Estimated assets of 38 billion and profit of 1.9 billion shillings. Otherwise a flat year for the bank whose parent faced her own troubles in the US banking meltdown. Growth was about 5% as the bank got into the local IPO advisory races.

8. (6) Commercial Bank of Africa: Estimated assets of 40 billion and profit of 1.4 billion. Growth of 9% from a year ago got into unit trusts, home loans, insurance, and funding of women projects. Similar to CFC and would be prime candidate for a merger.

7. (7) National Bank of Kenya: Estimated assets of 45 billion ($645 million) and profit of 1.4 billion shillings ($20 million) for 2007. NBK finally had its most of its non- performing portfolio debt albatross sorted out with a government bailout in the form of bonds maturing over the next 10 years. Now that its cleaned up, it could once again be a target of Stanbic again who two years ago offered to buy out NSSF’s 48% after their CFC merger is done in 2008 (Equity Bank is a also long shot). During the year, NBK partnered with Standard investment bank offer stockbroking services through NBK branches and also tried to have businessman Ketan Somaia jailed over an unpaid debt to the bank

Jobs

– Chase Bank; Head of ICT, senior manager operations, head of trade finance. apply by snail mail to the Head of HR 28987-00200 by 29/2
– Cabin crew at Emirates airlines
– Fina Bank Uganda: The bank is starting operation in Uganda in January 2008, and those interested in working there should send detailed CVs to hr@finabank.com.
– tough job – Head of marketing & corporate communications at Kenya Airways apply online by 15/1

New stockbroker

Finally a new stockbroker is going to be invited to join the lucrative club that is the Nairobi Stock Exchange. The number of shareholders has gone up approximately ten times from pre-Kengen IPO, but the number of stockbrokers, through which investors must trade their shares has been stuck at 18 all that time (currently 17 since Francis Thuo was suspended earlier this year).

It’s only one seat to access this Kshs. 4 billion a year industry, but that can only improve the current situation. Who should win? Ideally a bank or financial institution with an extensive branch network. CFC bank – the only bank that’s also a stockbroker has the widest reach nationwide when compared to several one office stockbrokers in Nairobi

Application details here and only firms that can qualify as a stockbroker or investment bank are eligible. The Application fee is Kshs 50,000 ($700) to the NSE, and 2,500 to the Capital Markets Authority. Applications should also include a company profile and statement of financial support/bank guarantee for the bid amount which is reported to have a reserve price of Kshs 150 million ($2 million). D/L of 13/8 is just over a week away.

Other News & Follow up’s

– KTN reported that the housing Finance deal (buy in by Equity) could be in jeopardy owing to a burden of borrower lawsuits that could be a major liability for the bank since the introduction of in duplum rules to the banking sector. (One plaintiff won a major case against the bank last month)

– I & M: Two European development finance institutions take up a 12% stake in I&M – Kenya’s 11th largest bank

– NIC shareholders will this month be asked to vote on right issue and bonus share – in addition to modifying the company laws to expand the bank beyond Kenya, enter insurance, custodial, and investment banking, and allow unclaimed dividends by to be reinvested by the Bank until a shareholder shows up to claim them

– Welcome to the Kenya, land of milk & honey: The Safaricom IPO honey pot has attracted interest from BNP Paribas, Citicorp, Credit Suisse, Goldman Sachs, HSBC, JP Morgan, Morgan Stanley and other banking, financial and legal giants

– Next week’s East African reports on a proposed merger in the cement industry between Bamburi and East African Portland Cement companies.

– As expected parliament, without a legitimate quorum, passed the media bill

– Weak laws and evasion are robbin Kenya of tax money.

Opportunities

– Borrow up to Kshs 1,000,000 at 0% interest from Halaal Credit, but eligible only to Kenyan Sunni Muslims.

– Diaspora conference; a conference dubbed Incorporating the Preparatory Kenya Diaspora Home-Coming Forum will take place at KICC on 14-16 August, 2007. some issues will be exploring investment opportunities in Kenya, debate the Diaspora bill 2007 , building partnerships between European and African private and public sector stakeholders, SME and Diaspora sectors be mainstreamed into vision 2030, and proposal that an annual Kenya Diaspora Homecoming week be held every August of each year. Details can be got from info@kenyadiaspora.go.ke

– Design a logo and come up with a motto for the Kenya Investment Authority :

some jobs

– AON: retail broking manager, senior business development executive (health). Apply to HR@aon.co.ke by 17/8
– Chief executive officer at the export processing zones authority. Apply through manpower associates by 14/8
– KCB: branch managers, business banking managers. Apply to recruitment@kcb.co.ke by 17/8
– Safaricom: Investigator, senior fraud analyst, senior information security officer, senior information systems auditor, and a dozen technical jobs. Apply to
hr@safarciom.co.ke by 10/8
– UAP: Relationship officer, internal risk surveyor, agricultural underwriter. Apply to recruitment@uapkenya.com.

Bank & anti-corruption jobs

Various jobs at Investments & Mortgages (I&M) Bank (Details should be here soon) including;

  • General manager finance & corporate planning
  • Manager risk management
  • Relationship officers/managers
  • Manager liability management (Nairobi)
  • Manager finance & administration
  • Human resource officer
  • Credit officers (Nairobi)
  • Compliance & quality assurance officer
  • Management trainees (people aged 22 – 25 who have studied abroad in the UK, New Zealand, Australia & Canada are encouraged to apply)

Apply to the group human resource manager at recruit@imbank.co.ke or p o box 30238-00100 Nairobi by April 25.

Website officer at the Kenya Anti Corruption Commission who will be in charge of day-to-day management and maintenance of a their site. Apply to the director, KACC p o box 61130-00200 by April 25.

More mortgages – I&M

Investment & Mortgages Bank (I&M) Home Loan
Use it to purchase a home, develop a home on previously purchased land, renovations, buy a home under construction by a reputable developer, or refinance an existing mortgage
– Who’s eligible?: Senior corporate managers & employees, self-employed professionals of good repute, or owners of stable businesses
– Loan: minimum 1 million, maximum 10, million, and I&M will finance up to 80% of property value or purchase price. – can be repaid between 1 and 15 years
Interest is on reducing balance at base +3%
– Fees include: (1) before approval application (5,000), valuation fee (between 4,000 and 10,000) (2) after approval: processing fee (0.5%, legal fees (22,000 – 40,000) mortgage insurance (5,000 – 36,000) and processing fee (1%)
– Typical loan: To buy your 6 million shilling ($75,000) home, I&M will finance 4.8 million ($60,000), and typical annual repayment at 16% will go from 450,000 ($5,625) in year 1 to 70,000 ($875) in year 15 [base rate at most banks now is 13%]

2004 Bank Round-Up

Investment & Mortgages Bank (I & M)
The Bank increased its after-tax profit to 255 million (up from 195 million) It had customer deposits of 11.6 billion (up from 10.1 b) and advanced 8.2 billion in loans to customers (up from 5.3b). It’s net interest income increased 217 million (up from 160) and staff costs increased to 217 Million (from 160m) but which was probably offset by an increase in rental income when the Standard/KTN Group moved into the Bank’s I&M Towers (other income increased from 57 to 116 million)

Equity Bank (formerly Equity Building Society)
Equity is on an expansion binge to correct an anomaly according to their MD James Mwangi, who has expressed a desire to expand the Bank’s loan book to increase income. The bank has 5 billion in customer deposits, but has only advanced 2.87 billion to customers – at year end they had 1.9 billion at other banks and 580 million in government securities. Net interest income was 396 million (up from 257m), while other income was 640 (306m) – staff costs were 286 million (up from 167 million).

Commercial Bank of Africa (CBA)
The Bank which this month announced a merger with sister Bank, First American, ended the year with a net after-tax profit of 282 million, which was down from 380 million in 2003. Despite having customer deposits of 17.6 billion (up from 15 billion) the bank only has advanced of 5.3 billion as loans to customers (up from 4.3 billion) – it ended the year with 5.5 as cash in other Banks and 6 billion in government securities (down from 8.5) The Ban earned 401 million in net interest income, 304 million from government securities and 312 million from commissions.

Akiba Bank
Akiba Bank is only the second major bank to record a loss in 2004 (after Fina Bank) still the loss of 42 million was a vast improvement from a 550 million loss the bank reported in 2003. Its main problem is non-performing loans as the Bank had to provide 153 million for bad debts (877 million in 2003). The Bank has 3 billion in deposits and 2.3 billion in customer loans.

Guardian bank
Another bank with a huge bad loan book is Guardian Bank. The Bank ended 2004 with a profit of 36 million (37 million in 03) and it has customer deposits of 3.2 billion and loans of 2.5 billion; however, the Bank has a total non-performing loan portfolio of 910 million.