• Kenya - 20 YEAR Treasury Bond
  • Issue No:FXD2/2018/20
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Family Bank has redeemed its five and half years (5 and ½ year) Medium-Term Notes (MTN) worth 2.0188 Billion shillings that were due on 19 th April 2021.

On this maturity date, the bondholders have been paid their principal together with the accrued interest of the final six months.

The notes included Fixed Rate Notes with a 13.75 percent coupon, Mixed Rate Notes with a 14.00 percent coupon, and Floating Rate Notes with a 182-day T-bill coupon rate plus 250 basis points.

“We wish to thank the investors who participated in the medium-term note. The MTN which was issued back in 2016 and listed in the Nairobi Securities Exchange supported the Bank in its expansion plans and served to strengthen the capital base to be able to increase lending to Medium and Small Sized Enterprises,” said Family Bank Chief Executive Officer Rebecca Mbithi. “We remain focused on the growth of the Bank to continue meeting the needs of our customers,” she added.

The lead transaction advisors for this transaction were NIC Capital & Faida Investment Bank, Deloitte & Touché as the reporting accountants, MTC Trust as the Note Trustees while Mboya Wangong’u & Waiyaki Advocates were the legal advisors.

In March this year, Family Bank posted an impressive 1.440 billion shillings Profit Before Tax for the group for the Full Year 2020 against 1.422 billion shillings in 2019, a 1.3 percent growth, demonstrating the Bank’s resilience amidst a challenging environment.

The Group reported a 14.9 percent growth in the total assets to 90.6 billion shillings with customer deposits registering a growth of 20.3 percent to 69.8 billion shillings for the period under review.

Investments in government securities increased by 65.9 percent from 10.2 billion shillings to 17 billion shillings. This boosted the Bank’s liquidity position to 37.1 percent, significantly above the minimum requirement of 20 percent.

“Our loan book expanded by 11.8 percent year on year to close at 56.6 billion shillings as we continued to support our customers who saw new opportunities despite the COVID-19 pandemic. This support was in diverse sectors such as manufacturing, agribusiness, trade, logistics, and technology,” said Family Bank Chief Executive Officer Rebecca Mbithi. More Articles From This Author

(Ecofin Agency) – After the bad year 2020 marked by the covid-19 pandemic, 2021 seems to bring fresh air to the Nairobi Securities Exchange. Analysts on the Cytonn Investment, a local investment firm, said the banking sector’s performances are expected to improve in the mid and long terms.

The sector’s revenues, which grew by 16.1% in 2020, are expected to grow further this year, driven by the financing needs of the government, whose widening budget deficit limits its ability to access international capital markets. Also, it is estimated that the deployment of the covid-19 vaccination in the world and Kenya will go with the revival of activities, thus limiting the non-repayment of credit.

The other helpful factor to the increase in banking revenues is the diversification of both activity and organic plans. Last year, the sector witnessed several acquisition operations. This helps broaden the banks’ revenue bases. The Covid-19 pandemic has boosted the number of people using mobile banking services; the restoration of fees on the use of this service is an additional element of optimism.

Finally, the ability of Kenya’s listed banks to lend to the economy has become greater since the central bank reduced the level of capital that commercial banks must set aside to cover lending to the economy. It is now 4.25%, down from 5.25%. At the same time, banks’ cash flow could increase at any time, depending on the pace of recovery.

The top 10 client countries for goods and services from Kenya include the United States, where the conditions for recovery are being put in place, but also European countries such as the Netherlands, or the United Kingdom, where the outlook is much more positive. It should be remembered that 2020 was a mixed year for banks on the Nairobi Securities Exchange.

Interest income has grown three times as fast. But banks that remain uncertain about the effects of the pandemic have preferred to increase the level of credit risk provisioning. For those listed banks, KSh586.1 billion ($5.43 billion) has been set aside.

Six of the ten listed banks have announced dividends totaling KSh18.6 billion. A decline in outstanding bad and overdue loans seems to have encouraged institutions to reward their shareholders.

Idriss Linge

Jubilee Holdings has posted 1.74 per cent growth in net profit for last year to Sh4.087 billion, bucking a trend of losses and fall in earnings witnessed in the insurance sector due to Covid-19 disruptions.

Consequently, the regional underwriter’s board has proposed a final dividend payout of Sh8 per share amounting to Sh579.78 million payable by end of July citing the strong performance.

This means Jubilee Holdings shareholders will have received a total of Sh652.26 million given that the Nairobi Securities Exchange-listed firm had paid an interim dividend of Sh72.47 million last year.

The insurer becomes the first listed underwriter to grow profits and pay a dividend in a tumultuous year that saw an increase in withdrawal of pension funds and surrender of policies.

Jubilee has attributed its stable performance to sound underwriting practices, tightening of controls over claims and expenses, and a diversified investment portfolio.

Sh78.2 million loss

"We were able to weather this storm through diversification of our product portfolio and our ability to rapidly deploy our business continuity plans to allow the majority of our staff to quickly adapt to the new working needs during the onset of the pandemic and ensuing lockdown," said Mr Nizar Juma, Jubilee Holdings chairman.

Most insurers have been hit by reduced returns from real estate and falling share values at the NSE–where they had invested billions of shillings.

Sanlam Kenya returned a Sh78.2 million loss– the second in nearly two decades as CIC broke its 13-year profit-making run with a net loss of Sh296.8 million.

Jubilee posted a 3.3 percent growth in net insurance premium revenue to Sh20.14 billion while investment income rose by 12.7 percent to Sh11.3 billion, pointing to the advantage realised from reduced exposure on NSE.

Jubilee Holdings regional chief executive Julius Kipn’getich altered the insurance business environment, ensuring the firms responds positively through strengthened agency networks and seamless customer service experience.Pandemic prevention"Our first focus was on effectively coordinating the pandemic prevention measures for both our staff and clients, a move that saw us significantly optimise our operations to achieve improved performance," said Mr Kipngetich.The underwriter’s expenses and commissions fell by 2.5 percent to Sh8.86 billion, taking pressure off the bottom-line.The group’s share of profit of associates increased by 34.5 percent to Sh1.33 billion, reflecting the impact of doubling its stake in Bujagali power project in Uganda last June.palushula@ke.nationmedia.com

Online beauty store BeautyClick has announced its intention to list at the Nairobi Securities Exchange (NSE). The firm’s shareholders recently approved the move to raise new equity aimed at the commercialisation of its beauty product offerings, strengthening its e-commerce platform and accelerating growth in Kenya and the region.

The approval included a directive to start the listing. The firm’s founder and director Jesper Drescher said the shareholders’ unanimous decision sets the pace for the company to invite the public to invest as it seeks further capitalisation to bolster its growth plan.

“Upon receiving the green light from shareholders, we kickstarted the process to seek requisite regulatory approvals for a listing and further capitalisation at the NSE. We have appointed a team of transaction advisors to provide appropriate guidance on the process," said Drescher.

It was incorporated in Kenya and is a wholly-owned subsidiary of Denmark based ClickBeauty International. KEEP READING

The Company has appointed one of Kenya’s leading transaction financial advisors – Standard Investment Bank as the lead Transaction Advisor. CDSC Registrars Limited will act as the receiving Agent and Data Processing Consultant while Cooperative Bank will be the Receiving Bank. Hill +Knowlton Strategies will be the Communication Consultants; other Advisors are: JP Advocates LLP as the Legal Advisors; Kirenge and Associates as the Reporting Accountant

Africanhair PLC, trading as BeautyClick, a beauty e-commerce company has announced its intention to raise new equity by listing at the Nairobi Securities Exchange.

Founded in 2016 by Danish investors, BeautyClick is a pioneering beauty e-commerce company that has grown to be the leading online retailer in Kenya’s beauty industry. The company, incorporated in Kenya, is a wholly-owned subsidiary of ClickBeauty International based in Denmark.

The Company’s shareholders recently approved its quest to raise new equity for the purpose of bolstering the commercialisation of its beauty product portfolio, enhancing its technology-backed e-commerce platform and accelerating growth both in Kenya and the region. The approval included a directive to immediately start the listing process.

Speaking on the shareholders’ consent for an NSE listing, the company’s founder, and director Jesper Drescher, said that the shareholders’ unanimous decision sets pace for the company to invite the public to invest as it seeks further capitalization to bolster is growth plan.

“Upon receiving the greenlight from our shareholders, we kickstarted the process to seek requisite regulatory approvals for a listing and further capitalization at the Nairobi Securities Exchange. To this end, we have appointed a team of experienced transaction advisors to provide the appropriate guidance on the process. Said Mr. Drescher

The Company has appointed one of Kenya’s leading transaction financial advisors – Standard Investment Bank as the lead Transaction Advisor. CDSC Registrars Limited will act as the receiving Agent and Data Processing Consultant while Cooperative Bank will be the Receiving Bank. Hill +Knowlton Strategies will be the Communication Consultants; other Advisors are: JP Advocates LLP as the Legal Advisors; Kirenge and Associates as the Reporting Accountants.

Investors at the Nairobi Securities Exchange (NSE) increased their traded volumes for bonds while equities volumes fell in the first quarter of 2021 in comparison to the corresponding period last year, as they continued to seek safety in fixed income assets in an uncertain economy.

NSE data shows that the volume of bonds traded between January and March stood at Sh199.4 billion, a 33 per cent increase on the Sh150.4 billion bonds traded at the NSE in the first quarter of 2020.

In contrast, the value of equities traded fell by 27 per cent from Sh43.6 billion in quarter one of 2020 to Sh31.8 billion in the first three months of this year.

Since the first case of Covid-19 was reported in the country in March 2020, heralding a period of restrictions and reduced economic activity, investors have tended towards government bonds to guarantee some returns at a time when other investment classes have struggled due to the poorly performing economy.

This has seen primary bond sales raise record amounts of bids, especially those of infrastructure bonds which have twice seen bids in excess of Sh100 billion in January and this month.

Those investors whose bids have been rejected by the Central Bank of Kenya (CBK) have been turning to the secondary bonds market at the NSE to buy the securities, this pushing up the traded volumes.

In the equities market, the hit on companies’ performance by the Covid pandemic has translated to falling share prices, which has in turn reduced investor trading activity, largely due to sellers being wary of offloading their stock at a loss.

The decision by many firms to withhold dividend payments, either due to a slide into loss making territory or as a capital conservation measure has also affected demand for shares.

Investors normally raise their demand for a particular stock when there are dividends on offer, while those already holding the shares get a chance to sell at a profit when prices go up due to the increased demand.

In Kenya and abroad, the stock market has minted millionaires.

It is where Warren Buffet, one of the world’s richest men, made the bulk of his Sh8 trillion net worth.

More Kenyans, including “small investors” with as little as Sh10,000, are now trading in the stock market hoping to strike it big.

However, there are some tricks to it. These include patience, the right expertise, correct timing and even luck.

But how does one start, or why should one invest in the Nairobi Securities Exchange (NSE) – one of Kenya’s easiest ways to own a company or a chain of them? KEEP READING

An employee makes notes in front of an electronic stock information screen inside the Nairobi Securities Exchange Ltd. (NSE), in Nairobi, Kenya, on Tuesday, Dec. 8, 2015. How to start trading in stocks

The first step is to open a central depository system (CDS) account, which will enable buy and sell shares and other securities. It is also important to remember that you are not an expert. This is where stockbrokers come in. They will help you set up the account.

A good broker will give you advice on the available stocks, how companies are performing, and at what point you should buy or sell.

After you deposit your funds with them, they will execute the trading for you and your returns will be deposited in your account.

What kind of investor will you be?

You can choose to either be a medium-term investor or a long-term one. You can also be both.Warren Buffet, the world’s greatest investor, uses the long-term strategy which requires patience. He identifies low-valued stocks with growth potential.Being a long-term investor, you earn annual dividends. The minimum number of shares you can buy is 100. There’s no limit to the number of companies you can own shares in.Here, patience is key and it’s important to not get frustrated.There are also outside factors that can make a stock market offer good returns.They include an economic slump such as the one brought about by the coronavirus pandemic.Companies perform well when the economy is doing well.Being a medium-term investor might mean you approach the stock market with a trading objective.Share prices normally go up and down guided by the demand and supply forces.This is why you need an expert to guide you when to buy or offload. Which are the best counters at the NSE? You can perhaps start by reviewing […]

The Nairobi Securities Exchange (NSE) has disclosed that it has acquired a 4 per cent stake in the Dar es Salaam Stock Exchange citing strategic reasons.

“Back in 2017, we took a position in the Dar er Salaam Stock exchange. Dar Es Salaam Stock exchange was doing an IPO. And its always been part of our regional strategy to invest in related businesses and so we invested in the DSE during the IPO. We however were able to make an exit because we got some profit. But again the board reconsidered this position and felt that we should have taken a strategic position… And so we went back and took a bigger stake of almost 4.9%..” Said Mr Geoffrey Odundo, the CEO of the NSE while speaking to NTV Kenya.

Mr Odundo further disclosed that they were targeting a stake of almost 10 per cent but due to restrictions on external investors, they were capped at 5%.

He also disclosed that the value of NSE’s investment in DSE has declined mainly due to the decline in DSE’s share price as shown in the chart below.

The Nairobi Securities Exchange (NSE) has stepped up its push for the sale of additional government stake in Safaricom and cash-rich parastatals like Kenya Ports Authority (KPA) to cut the State appetite for expensive loans in the short term. The NSE chief executive Geoffrey Odundo told Parliament Tuesday that the State has the potential to raise Sh792.6 billion from the sale of stakes in listed firms including Kenya Re , KCB and KenGen .

Nairobi bourse reckons that Kenya can cut reliance on debt to fund projects in the short term through fresh listings of cash-rich state firms like Kenya Pipeline Company (KPC), Kenya Ports Authority (KPA) and Kenya Airports Authority (KAA).

The mounting public debt has seen Kenya commit more than half of taxes or Sh1 trillion annually to paying loans, leaving little cash for building roads, affordable housing and revamping of the ailing health sector.

“Listing of companies and selling more stake is a clear intervention to raise internally raise money and reduce the debt, you can even use some of the money to offset the expensive debt,” Mr Odundo yesterday told the National Assembly Committee on Finance and National Planning.

NSE says the State has the potential to raise Sh150 billion by reducing its stake in Safaricom to 25 per cent from the current 35 per cent. The State in 2008 raised more than Sh50 billion after selling a 25 per cent stake, or 10 billion shares, in Safaricom.

The sale of a 10 per cent stake in KCB can raise Sh15 billion while cutting the government stake in KenGen from 70 per cent to 40 per cent can bring Sh12 billion.

The initial public offering (IPO) of KAA could raise Sh400 billion through the sale of a 40 per cent stake with the listing of part of KPA and KPC shares expected to generate Sh33.9 billion and Sh43 billion respectively.

The share sale proposals presented to Parliament comes weeks to the end of a debt repayment moratorium, which saw China and other richer nations freeze part of loan servicing for six months to June.

The Jubilee administration has ramped up spending since 2013 to build new roads, a modern railway, bridges and electricity plants, driving up borrowing to plug the budget deficit.

Treasury chiefs project in a draft Budget Review and Outlook Paper new loans of Sh1.87 trillion in the two years to June 2020 or Sh2.5 billion daily, pushing Kenya’s debt to Sh8.06 […]

A display of listed equities at the NSE. PHOTO | CITIZEN DIGITAL Re-imposed restrictions to contain the COVID-19 pandemic have served to reverse gains made by the performance of the stock market.

While the Nairobi Securities Exchange (NSE) was tipped to turn the corner in performance this year, the past week has served as a dampener to the resurgence prospects.

At the end of the first quarter of the year to March, NSE gains stood at 4.3 per cent for the all share index, 3.4 per cent for the NSE 25 index and negative 1.2 per cent for NSE 20.

The pick up was anchored on gains made by large cap companies such as BAT, KCB Group. Safaricom and Cooperative Bank whose margins were up by 31.6 per cent, 8.4, 5.8 and 5.6 per cent respectively.

The past week has nevertheless restored volatility for the stock market with all three indexes shedding 3.5, 2 and 2.9 per cent of their values respectively.

This to follow dwindling interests in stocks by investors following the re-introduction of tough containment measures by government on March 26.

Co-operative Bank, EABL and Equity have felt the burn of the new slump with their stock prices shedding 12.1, 5.8 and 4.8 per cent of their values respectively in the last week of trading.

On their part, foreign investors participation has remained lackluster, posting a year to date (YTD) performance of Ksh.970.1 million ($8.9 million) in net sell offs over the first quarter. In the last week alone, foreign investors dumped stocks equivalent to Ksh.991.9 million ($9.1 million).

The NSE is looking to escape another bear run year after suffering the pandemic effects of the COVID-19 pandemic last year.

NSE primary indices — the Nairobi All Share Index (NASI), NSE 20 and NSE 25 — shed 8.6, 16.7 and 29.6 per cent of their values in 2020 with foreign investors offloading nearly Ksh.31 billion from the exchange in the 12 months.

The NSE nevertheless still trades at 6.7 per cent below the historical 12.9 times price to earnings ratio represents pockets of value to willing investors.Nevertheless the market is overvalued from a stand point of the all share price to earnings growth ratio (PEG) which sits at 1.4 times.Analysts at Cytonn Investment expect investors to favor holdings in companies with a higher growth potential.“With the market trading at a premium to its future earnings growth, despite the low valuations currently in the market, we believe that […]