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Portfolio Balancing: Avoid Over Exposure To Financial Sector
murchr
#181 Posted : Sunday, February 04, 2018 6:26:11 PM
Rank: Elder


Joined: 2/26/2012
Posts: 13,588
Citi Report





"There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
.
shiznit
#182 Posted : Monday, February 05, 2018 10:18:53 AM
Rank: New-farer


Joined: 5/21/2013
Posts: 63
Location: KENYA
murchr wrote:
Citi Report







Do you have a link to the report itself? If yes, kindly share here, or on the mailing list.
“The market can remain irrational longer than you can remain solvent.” - John Maynard Keynes
Ericsson
#183 Posted : Monday, February 12, 2018 10:36:37 AM
Rank: Elder


Joined: 12/4/2009
Posts: 5,662
Location: NAIROBI
https://www.businessdail...300332-l4u0i/index.html

Kenyan banks have been given a five-year waiver from higher capital requirements in the wake of a more conservative accounting standard that took effect on January 1.

Adoption of the International Financial Reporting Standards (IFRS 9) will see banks provide for expected loan losses rather than those already incurred, reducing their profitability and eroding their capital base.

The Central Bank of Kenya (CBK) has however written to banks, notifying them that it will overlook capital shortfalls brought about by the new accounting standard.

The decision, which will allow lenders to also report their accounts as if IFRS 9 has not come into force, is meant to buy them time to bolster their capital.
Spikes
#184 Posted : Monday, February 12, 2018 10:42:59 AM
Rank: Elder


Joined: 9/20/2015
Posts: 2,458
Location: Mombasa
Ericsson wrote:
https://www.businessdailyafrica.com/corporate/companies/CBK-gives-banks-5-year-reprieve-to-raise-capital/4003102-4300332-l4u0i/index.html

Kenyan banks have been given a five-year waiver from higher capital requirements in the wake of a more conservative accounting standard that took effect on January 1.

Adoption of the International Financial Reporting Standards (IFRS 9) will see banks provide for expected loan losses rather than those already incurred, reducing their profitability and eroding their capital base.

The Central Bank of Kenya (CBK) has however written to banks, notifying them that it will overlook capital shortfalls brought about by the new accounting standard.

The decision, which will allow lenders to also report their accounts as if IFRS 9 has not come into force, is meant to buy them time to bolster their capital.


Experts weigh in on this scenario; are we headed north or south in terms share price movements.
Ignorance of the victim is big business for the villain.
Ebenyo
#185 Posted : Monday, February 12, 2018 2:14:47 PM
Rank: Veteran


Joined: 4/4/2016
Posts: 1,368
Location: Kitale
Ericsson wrote:
https://www.businessdailyafrica.com/corporate/companies/CBK-gives-banks-5-year-reprieve-to-raise-capital/4003102-4300332-l4u0i/index.html

Kenyan banks have been given a five-year waiver from higher capital requirements in the wake of a more conservative accounting standard that took effect on January 1.

Adoption of the International Financial Reporting Standards (IFRS 9) will see banks provide for expected loan losses rather than those already incurred, reducing their profitability and eroding their capital base.

The Central Bank of Kenya (CBK) has however written to banks, notifying them that it will overlook capital shortfalls brought about by the new accounting standard.

The decision, which will allow lenders to also report their accounts as if IFRS 9 has not come into force, is meant to buy them time to bolster their capital.



This one is good news.But it will be good for a wise bank to implement the system earlier so that at the end of the grace peod,adjustment will be easy.
Towards the goal of financial freedom
Ericsson
#186 Posted : Tuesday, February 13, 2018 11:17:09 AM
Rank: Elder


Joined: 12/4/2009
Posts: 5,662
Location: NAIROBI
State Finds Solutions for Its 3 Struggling Banks

Since 2008, the plans to merge National Bank, Consolidated Bank, and Development Bank have failed. Before the merger plans, the Privatisation Commission had submitted comprehensive proposals for the sale of National Bank and Consolidated Bank to the Treasury in accordance with the Privatisation Act. However, these plans also stalled.

Therefore, the commission has recently announced plans to restructure Consolidated Bank through a consultant. The restructuring plans are aimed at selling the government’s stake for Sh2.5 billion.

“The transaction adviser is required to prepare a restructuring and options analysis report. The work to be undertaken includes the review of the possibility of implementing a rights issue as part of the privatisation of the bank,” Jaqueline Muindi, acting CEO stated.

National Bank of Kenya could also be sold to Kenya Commercial Bank if a proposal to sell it is approved. In addition, Development Bank will be merged with the following institutions: Uwezo Fund, Kenya Industrial Estates, Women Enterprise Development Fund, Industrial Development Bank of Kenya, and Youth Enterprise Development Fund. The merger will form a large development finance institution.

The three banks have a total capital of KES13.17 billion. The government’s 50.2 percent equity in Consolidated Bank is held through Deposit Protection Fund and its 89.3 percent stake in National Bank is held through Industrial and Commercial Development Corporation.
VituVingiSana
#187 Posted : Tuesday, February 13, 2018 12:42:11 PM
Rank: Chief


Joined: 1/3/2007
Posts: 14,906
Location: Nairobi
Ericsson wrote:
State Finds Solutions for Its 3 Struggling Banks

Since 2008, the plans to merge National Bank, Consolidated Bank, and Development Bank have failed. Before the merger plans, the Privatisation Commission had submitted comprehensive proposals for the sale of National Bank and Consolidated Bank to the Treasury in accordance with the Privatisation Act. However, these plans also stalled.

Therefore, the commission has recently announced plans to restructure Consolidated Bank through a consultant. The restructuring plans are aimed at selling the government’s stake for Sh2.5 billion.

“The transaction adviser is required to prepare a restructuring and options analysis report. The work to be undertaken includes the review of the possibility of implementing a rights issue as part of the privatisation of the bank,” Jaqueline Muindi, acting CEO stated.

National Bank of Kenya could also be sold to Kenya Commercial Bank if a proposal to sell it is approved. In addition, Development Bank will be merged with the following institutions: Uwezo Fund, Kenya Industrial Estates, Women Enterprise Development Fund, Industrial Development Bank of Kenya, and Youth Enterprise Development Fund. The merger will form a large development finance institution.

The three banks have a total capital of KES13.17 billion. The government’s 50.2 percent equity in Consolidated Bank is held through Deposit Protection Fund and its 89.3 percent stake in National Bank is held through Industrial and Commercial Development Corporation.

Good. The fewer fingers GoK has in the banking industry the better.
The 2.5bn can be used to reduce debt. Not that it will be used to do so!
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
Ericsson
#188 Posted : Thursday, February 15, 2018 1:05:48 PM
Rank: Elder


Joined: 12/4/2009
Posts: 5,662
Location: NAIROBI
https://www.businessdail...5402-ie4bo2z/index.html

Kenyan banks are not deriving value in their regional operations with subsidiaries in volatile South Sudan unlikely to stay viable due to conflict and currency woes, investment bank Renaissance Capital says.
Ebenyo
#189 Posted : Thursday, February 15, 2018 2:08:08 PM
Rank: Veteran


Joined: 4/4/2016
Posts: 1,368
Location: Kitale
Ericsson wrote:
https://www.businessdailyafrica.com/markets/marketnews/Kenyan-banks--East-Africa-expansion-hits-rough-patch/3815534-4305402-ie4bo2z/index.html

Kenyan banks are not deriving value in their regional operations with subsidiaries in volatile South Sudan unlikely to stay viable due to conflict and currency woes, investment bank Renaissance Capital says.



kcb should pull out of south sudan.But pan african vision should continue only in viable countries.
Coop will do well in south sudan because of the partnership with Goss.
Towards the goal of financial freedom
Ericsson
#190 Posted : Thursday, February 15, 2018 7:05:52 PM
Rank: Elder


Joined: 12/4/2009
Posts: 5,662
Location: NAIROBI
Ebenyo wrote:
Ericsson wrote:
https://www.businessdailyafrica.com/markets/marketnews/Kenyan-banks--East-Africa-expansion-hits-rough-patch/3815534-4305402-ie4bo2z/index.html

Kenyan banks are not deriving value in their regional operations with subsidiaries in volatile South Sudan unlikely to stay viable due to conflict and currency woes, investment bank Renaissance Capital says.



kcb should pull out of south sudan.But pan african vision should continue only in viable countries.
Coop will do well in south sudan because of the partnership with Goss.


African economies growth is below par due to high debt, poor governance
I don't blame Barclays for having exited Africa operations. They can get better returns by focussing in America and Asia
VituVingiSana
#191 Posted : Thursday, February 15, 2018 10:21:27 PM
Rank: Chief


Joined: 1/3/2007
Posts: 14,906
Location: Nairobi
Ericsson wrote:
Ebenyo wrote:
Ericsson wrote:
https://www.businessdailyafrica.com/markets/marketnews/Kenyan-banks--East-Africa-expansion-hits-rough-patch/3815534-4305402-ie4bo2z/index.html

Kenyan banks are not deriving value in their regional operations with subsidiaries in volatile South Sudan unlikely to stay viable due to conflict and currency woes, investment bank Renaissance Capital says.



kcb should pull out of south sudan.But pan african vision should continue only in viable countries.
Coop will do well in south sudan because of the partnership with Goss.


African economies growth is below par due to high debt, poor governance
I don't blame Barclays for having exited Africa operations. They can get better returns by focussing in America and Asia

I thought there were other reasons including cashing out to get more capital for their "mother" banks. Anyway, in Kenya BBK screwed up by kicking out wananchi and ceding ground to Equity among others. At one point, NIC was a subsidiary of BBK.
One risk global banks face is dealing with "terrorist" or "money laundering" clients in certain jurisdictions. I think the global banks fear they will be penalized in the US/EU by the regulators.

Apparently, Citibank Kenya will only deal with vetted local institutions, embassies and MNCs.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
Ebenyo
#192 Posted : Friday, February 16, 2018 9:31:45 AM
Rank: Veteran


Joined: 4/4/2016
Posts: 1,368
Location: Kitale
VituVingiSana wrote:
Ericsson wrote:
Ebenyo wrote:
Ericsson wrote:
https://www.businessdailyafrica.com/markets/marketnews/Kenyan-banks--East-Africa-expansion-hits-rough-patch/3815534-4305402-ie4bo2z/index.html

Kenyan banks are not deriving value in their regional operations with subsidiaries in volatile South Sudan unlikely to stay viable due to conflict and currency woes, investment bank Renaissance Capital says.



kcb should pull out of south sudan.But pan african vision should continue only in viable countries.
Coop will do well in south sudan because of the partnership with Goss.


African economies growth is below par due to high debt, poor governance
I don't blame Barclays for having exited Africa operations. They can get better returns by focussing in America and Asia

I thought there were other reasons including cashing out to get more capital for their "mother" banks. Anyway, in Kenya BBK screwed up by kicking out wananchi and ceding ground to Equity among others. At one point, NIC was a subsidiary of BBK.
One risk global banks face is dealing with "terrorist" or "money laundering" clients in certain jurisdictions. I think the global banks fear they will be penalized in the US/EU by the regulators.

Apparently, Citibank Kenya will only deal with vetted local institutions, embassies and MNCs.



Barclays Africa Group owns 70% of BBK which is up for grab.Whoever buys and change the business modell will reap good returns.
Towards the goal of financial freedom
Ericsson
#193 Posted : Friday, February 16, 2018 9:33:19 AM
Rank: Elder


Joined: 12/4/2009
Posts: 5,662
Location: NAIROBI
Ebenyo wrote:
VituVingiSana wrote:
Ericsson wrote:
Ebenyo wrote:
Ericsson wrote:
https://www.businessdailyafrica.com/markets/marketnews/Kenyan-banks--East-Africa-expansion-hits-rough-patch/3815534-4305402-ie4bo2z/index.html

Kenyan banks are not deriving value in their regional operations with subsidiaries in volatile South Sudan unlikely to stay viable due to conflict and currency woes, investment bank Renaissance Capital says.



kcb should pull out of south sudan.But pan african vision should continue only in viable countries.
Coop will do well in south sudan because of the partnership with Goss.


African economies growth is below par due to high debt, poor governance
I don't blame Barclays for having exited Africa operations. They can get better returns by focussing in America and Asia

I thought there were other reasons including cashing out to get more capital for their "mother" banks. Anyway, in Kenya BBK screwed up by kicking out wananchi and ceding ground to Equity among others. At one point, NIC was a subsidiary of BBK.
One risk global banks face is dealing with "terrorist" or "money laundering" clients in certain jurisdictions. I think the global banks fear they will be penalized in the US/EU by the regulators.

Apparently, Citibank Kenya will only deal with vetted local institutions, embassies and MNCs.



Barclays Africa Group owns 70% of BBK which is up for grab.Whoever buys and change the business modell will reap good returns.


Who said it's up for grabs and where is the article,
Ericsson
#194 Posted : Friday, February 16, 2018 9:43:03 AM
Rank: Elder


Joined: 12/4/2009
Posts: 5,662
Location: NAIROBI
VituVingiSana wrote:
Ericsson wrote:
Ebenyo wrote:
Ericsson wrote:
https://www.businessdailyafrica.com/markets/marketnews/Kenyan-banks--East-Africa-expansion-hits-rough-patch/3815534-4305402-ie4bo2z/index.html

Kenyan banks are not deriving value in their regional operations with subsidiaries in volatile South Sudan unlikely to stay viable due to conflict and currency woes, investment bank Renaissance Capital says.



kcb should pull out of south sudan.But pan african vision should continue only in viable countries.
Coop will do well in south sudan because of the partnership with Goss.


African economies growth is below par due to high debt, poor governance
I don't blame Barclays for having exited Africa operations. They can get better returns by focussing in America and Asia

I thought there were other reasons including cashing out to get more capital for their "mother" banks. Anyway, in Kenya BBK screwed up by kicking out wananchi and ceding ground to Equity among others. At one point, NIC was a subsidiary of BBK.
One risk global banks face is dealing with "terrorist" or "money laundering" clients in certain jurisdictions. I think the global banks fear they will be penalized in the US/EU by the regulators.

Apparently, Citibank Kenya will only deal with vetted local institutions, embassies and MNCs.


Barclays PLC reports it's accounts/profits in Sterling Pounds.It's biggest contributor to profits in Africa was ABSA.
With Zuma politics and governance,South Africa economy experienced a downturn which hurt the profits.
BBK didn't kick out mwananchi,if you look at its model since independence it was targeting the african working class community,teachers/government employees and indian businessmen.This ones suffered during the last term of KANU/Moi regime.Even stanchart and KCB closed branches in some areas.
BBK owned NIC but they were forced to sell it and the Ndegwas took it over since they were close to the ruling power/elite.
Barclays PLC has decided to focus in North AMerica/USA where they expect to get better returns due to the booming economy like growing personal expenditure,mortgage,car loans,credit cards,booming stock exchange
Ebenyo
#195 Posted : Friday, February 16, 2018 5:20:37 PM
Rank: Veteran


Joined: 4/4/2016
Posts: 1,368
Location: Kitale
Ericsson wrote:
Ebenyo wrote:
VituVingiSana wrote:
Ericsson wrote:
Ebenyo wrote:
Ericsson wrote:
https://www.businessdailyafrica.com/markets/marketnews/Kenyan-banks--East-Africa-expansion-hits-rough-patch/3815534-4305402-ie4bo2z/index.html

Kenyan banks are not deriving value in their regional operations with subsidiaries in volatile South Sudan unlikely to stay viable due to conflict and currency woes, investment bank Renaissance Capital says.



kcb should pull out of south sudan.But pan african vision should continue only in viable countries.
Coop will do well in south sudan because of the partnership with Goss.


African economies growth is below par due to high debt, poor governance
I don't blame Barclays for having exited Africa operations. They can get better returns by focussing in America and Asia

I thought there were other reasons including cashing out to get more capital for their "mother" banks. Anyway, in Kenya BBK screwed up by kicking out wananchi and ceding ground to Equity among others. At one point, NIC was a subsidiary of BBK.
One risk global banks face is dealing with "terrorist" or "money laundering" clients in certain jurisdictions. I think the global banks fear they will be penalized in the US/EU by the regulators.

Apparently, Citibank Kenya will only deal with vetted local institutions, embassies and MNCs.



Barclays Africa Group owns 70% of BBK which is up for grab.Whoever buys and change the business modell will reap good returns.


Who said it's up for grabs and where is the article,



Barclays plc is selling their stake in Barclays africa.in fews year time,the brand will cease to exist in africa.It will be rebranded to the buyer name.
Towards the goal of financial freedom
Ericsson
#196 Posted : Friday, February 16, 2018 5:43:02 PM
Rank: Elder


Joined: 12/4/2009
Posts: 5,662
Location: NAIROBI
Ebenyo wrote:
Ericsson wrote:
Ebenyo wrote:
VituVingiSana wrote:
Ericsson wrote:
Ebenyo wrote:
Ericsson wrote:
https://www.businessdailyafrica.com/markets/marketnews/Kenyan-banks--East-Africa-expansion-hits-rough-patch/3815534-4305402-ie4bo2z/index.html

Kenyan banks are not deriving value in their regional operations with subsidiaries in volatile South Sudan unlikely to stay viable due to conflict and currency woes, investment bank Renaissance Capital says.



kcb should pull out of south sudan.But pan african vision should continue only in viable countries.
Coop will do well in south sudan because of the partnership with Goss.


African economies growth is below par due to high debt, poor governance
I don't blame Barclays for having exited Africa operations. They can get better returns by focussing in America and Asia

I thought there were other reasons including cashing out to get more capital for their "mother" banks. Anyway, in Kenya BBK screwed up by kicking out wananchi and ceding ground to Equity among others. At one point, NIC was a subsidiary of BBK.
One risk global banks face is dealing with "terrorist" or "money laundering" clients in certain jurisdictions. I think the global banks fear they will be penalized in the US/EU by the regulators.

Apparently, Citibank Kenya will only deal with vetted local institutions, embassies and MNCs.



Barclays Africa Group owns 70% of BBK which is up for grab.Whoever buys and change the business modell will reap good returns.


Who said it's up for grabs and where is the article,



Barclays plc is selling their stake in Barclays africa.in fews year time,the brand will cease to exist in africa.It will be rebranded to the buyer name.


That was already done and completed
Ericsson
#197 Posted : Saturday, February 17, 2018 7:30:35 AM
Rank: Elder


Joined: 12/4/2009
Posts: 5,662
Location: NAIROBI
CBK has given banks 5 years to comply with IFRS9.
Wapi vvs to comment on this
wukan
#198 Posted : Saturday, February 17, 2018 7:41:53 AM
Rank: Member


Joined: 11/13/2015
Posts: 862
Ericsson wrote:
CBK has given banks 5 years to comply with IFRS9.
Wapi vvs to comment on this


No CBK gave banks 5 years to repair the capital side. Banks implement IFRS9 but 5 years to do capital raising.
Ericsson
#199 Posted : Saturday, February 17, 2018 8:27:25 AM
Rank: Elder


Joined: 12/4/2009
Posts: 5,662
Location: NAIROBI
wukan wrote:
Ericsson wrote:
CBK has given banks 5 years to comply with IFRS9.
Wapi vvs to comment on this


No CBK gave banks 5 years to repair the capital side. Banks implement IFRS9 but 5 years to do capital raising.

It's the same thing as what i said.
IFRS9=Higher capital to cater for risks
VituVingiSana
#200 Posted : Saturday, February 17, 2018 2:49:15 PM
Rank: Chief


Joined: 1/3/2007
Posts: 14,906
Location: Nairobi
Ericsson wrote:
wukan wrote:
Ericsson wrote:
CBK has given banks 5 years to comply with IFRS9.
Wapi vvs to comment on this


No CBK gave banks 5 years to repair the capital side. Banks implement IFRS9 but 5 years to do capital raising.

It's the same thing as what i said.
IFRS9=Higher capital to cater for risks

@ericsson Some banks [esp one SIFI with a huge GoK shareholding] got a pass [on the Capital side as @wukan put it] but that doesn't mean they do not have to "provision" the SLRs within that timeframe.

The question is: Why does KCB have SLRs (as a % of the Loan Book) far higher than the most of the banks?
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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