• Kenya - 91 DAY Treasury Bill
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Money is constantly moving between Africa and the rest of the world Banks, ATMs, and agent networks are the main channels for accessing financial services in Nigeria. But because agents outnumber bank branches and ATMs , while performing a similar range of services, companies that support agent banking can be crucial assets to anyone looking to tap into Africa’s largest market for digital financial services.

One evidence of this came up last week when MFS Africa, the South Africa-based payments gateway that enables over 300 million wallets to transact across different mobile money platforms, said it has bought Capricorn Digital, a Nigerian company that runs a network of agents.

Capricorn is known for its Baxi boxes, a sort of point of sale device that agents—in their wooden kiosks and corner shops—use to offer services like cash deposits, withdrawals, and utility payments to consumers. The money value of the acquisition was not disclosed. But just like when MFS Africa bought Beyonic, a Uganda-based digital payments services provider, in June 2020 , the strategic value is in taking advantage of mobile payments for easier pan-African trade. MFS Africa sees Nigeria’s agent banking as mobile money’s evolution

“You can’t really be serious about being a pan-African company if you are not serious about Nigeria,” Dare Okoudjou, the company’s CEO, said.

MFS Africa’s usual procedure for establishing a market in Africa is to become partners with mobile network operators that run mobile money services. Some of their partner telcos include Safaricom, and MTN Uganda. On average, “by partnering with two or three networks, we can cover 70% of a country,” Okoudjou said.

But mobile network operators do not run massive mobile money services in Nigeria. MTN and Airtel don’t have licenses in the first place because the Nigeria central bank says it doesn’t want them to have such licenses. And so MFS Africa chose to buy a company doing something similar to what mobile money providers do in places like Kenya or Ghana.

But where mobile money providers provide basic cash deposits and withdrawals, companies like Capricorn in Nigeria evolved an agent banking model that facilitates a more diverse set of value added services from bill payments to the distribution of renewable energy services . “We think that the possibilities that mobile money guys have right now is a little bit smaller than the possibilities agents have in Nigeria right now,” Okoudjou said.

One use case for MFS […]

Plane manufacture Boeing forecasts that Africa’s airlines will invest $160 billion in acquiring additional 1,030 aircraft by 2040 to meet the growing demand for flying in the continent, raising hopes for the recovery of the sector that has been hard hit by Covid-19.

Boeing says Africa’s strong, long-term growth prospects for commercial aviation are closely tied to the continent’s projected three percent annual economic growth over the next 20 years.

Initiatives such as the African Continental Free Trade Area and Single African Air Transport Market are expected to stimulate trade, air travel and economic cooperation.

The US-based manufacturer also notes that the continent will require aftermarket services such as manufacturing and repair of these aircraft worth $235 billion, enabling growth for air travel and economies across the region.

“Africa has healthy opportunities to expand travel and tourism, coinciding with increasing urbanisation and rising incomes,” said Randy Heisey, Boeing managing director of commercial marketing for the Middle East and Africa.

“African carriers are well-positioned to support inter-regional traffic growth and capture market share by offering services that efficiently connect passengers and enable commerce within the continent,” he added.

The company shared the projection as part of the 2021 Commercial Market Outlook (CMO), the firm’s long-term assessment of demand for commercial airplanes and services.

Boeing said the region’s middle class and working population is projected to double by the end of the forecast period, driving increased demand for air travel.

The 2021 Africa CMO also projects that airlines in Africa will grow their fleets by 3.6 percent per year to accommodate passenger traffic growth of 5.4 percent annually, the third-highest growth rate in the world.

According to Boeing, single-aisle jets are expected to account for more than 70 percent of commercial deliveries, with 740 new planes mainly supporting domestic and inter-regional demand.

In addition, African carriers are estimated to need 250 new widebodies, including passenger and cargo models, to support long-haul routes and air freight growth.The firm also projects that 80 percent of African jet deliveries are expected to serve fleet growth with more sustainable, fuel-efficient models such as the Boeing 737, 777X and 787 Dreamliner, with 20 percent of deliveries replacing older airplanes.Kenya Airways operates a fleet of Boeings for its long-range routes and a number of Embraer aircraft. Last year, the carrier said it was looking at Boeing as the best replacement for some of its aircraft that are due for retiring.The estimated demand for aviation personnel will rise […]

East African Breweries Limited (EABL) said yesterday its Sh11 billion bond was oversubscribed by more than three times signalling renewed investor confidence in the previously troubled local bond market.

Investors bid a total of Sh37.9 billion in the issuing round, EABL said, representing an oversubscription of 275 percent.

“We issued this medium-term note based on our proven track record in the debt capital markets and we are pleased that investors have resoundingly expressed their confidence in this business, and the willingness to share value from our growth,” said EABL group chief executive Jane Karuku in a statement.

“The fact that this achievement was delivered in the face of depressed economic conditions further signifies the belief investors have in our strategy as this business turns 100 next year.”

The five-year, fixed-rate instrument is offered at an interest rate of 12.25 percent payable semi-annually.

The offer was opened on October 6 and closed on October 21 and will be listed for trading on the Nairobi Securities Exchange from November 1.

The Capital Markets Authority (CMA) said the oversubscription reflected renewed investor confidence in the corporate bond market.

Some issuers have defaulted or restructured their obligations in recent years, causing major losses for bondholders whose claims were unsecured.

ARM Cement, Nakumatt Holdings, Chase Bank and Imperial Bank are some of the borrowers that have defaulted on their bonds and commercial papers.

“I am delighted with the performance of the EABL medium-term note which is a testament of the renewed interest in the corporate bond market with growing issuer and investor confidence,” CMA chief executive Wyckliffe Shamiah.

Investors in the instruments have traditionally asked for above-market interest rates as compensation for lack of collateral and looser covenants.EABL has increased its borrowing in recent years, partly to fund new capital expenditures.EABL, for instance, is building a Sh15 billion factory in Kisumu that will produce its Senator beer brand that targets low-income consumers.It received loans amounting to Sh300 million for the construction of the plant in the year ended June, with more funding set to be sourced as the project progresses. The company had undrawn available funding of Sh13.4 billion as of June. bnjoroge@ke.nationmedia.com

A stockbroker at the Nairobi Securities Exchange trading floor. FILE PHOTO | NMG The Nairobi Securities Exchange (NSE) will introduce day trading from next month to deepen capital markets, where turnover and trading activity has remained flat in recent years.

The NSE said on Tuesday it had received approval from the Capital Markets Authority (CMA) for the roll out of day trading on 22 November.

Day trading refers to the practice of purchasing and selling a security within a single day or trading session or multiple times over the course of the day.

Trades are handled by the Central Depository and Settlement Corporation (CDSC), which provides clearing, settlement and depository services for listed securities.

NSE chief executive Geoffrey Odundo said day trading would boost liquidity at the bourse, which has 65 listed firms where telcos and banks dominate trade.

“Day trading is a welcome move for local investors who have previously lobbied for the activation of the intraday trading, as they seek to take advantage of intraday price movements and increase their profit margins,” said Mr Odundo.

“We are confident of a bullish market performance going forward.”

Experts say same-day trading and settlement would deepen liquidity on the bourse.

Successful day trades are seen as lucrative since they could turn a quick profit for investors.

“Day trading will allow investors to trade on one position, two or three times per day,” said NSE Chairman, Kiprono Kittony.

“This will significantly increase our turnovers and attract more investors to the bourse, further entrenching the NSE as an innovative and transformational Exchange in the region.”In 2019, the NSE, launched derivatives also in efforts to boost liquidity.Derivatives are an investment tool whose value is derived from an underlying asset like bonds, commodities, currencies, interest rates, market indexes and stocks based on the expected future price movement of the asset.They allow investors to make a gain or hedge against losses by taking a bet on the future price movement.To boost uptake of day trades, the NSE said it will introduce an incentive structure whereby investors who participate in day trades will receive a discount on the second leg of the transaction which will be levied at 0.114 percent compared to normal trades which are levied at 0.12 percent.“This benefit will be enjoyed by the investor directly through their trading accounts,” said the bourse.“The successful roll out of the new initiatives is tipped to firm up the rebound of the NSE after the drastic impact […]

Vodacom Group has tapped Safaricom’s #ticker:SCOM chief corporate affairs officer Stephen Chege as its group chief external affairs officer.

The announcement was made by Safaricom chief executive officer Peter Ndegwa in a memo to Safaricom staff seen by the B usiness Daily .

"Steve will take up the role at Vodacom headquarters in Johannesburg and will be responsible for group regulatory, external and corporate affairs, public policy, communication strategy, media relationships, group corporate social investment and sustainability," said Mr Ndegwa in the internal announcement.

Mr Chege’s appointment will take effect mid next month. He will report to the chief executive of Vodacom Group Shameel Joosub.

Mr Chege, a University of Nairobi trained lawyer, has risen through the ranks at Safaricom to his current position which he held since 2015 having joined Safaricom as in-house counsel in 2006.

"He has had a distinguished and successful career guiding Safaricom’s position in legal, competition, regulatory and reputational matters, developing industry policy, positioning Safaricom as a purpose led organisation and making a significant contribution to the success of Safaricom," said Mr Ndegwa.

Vodacom, a South African operator owns 35 percent of Safaricom.

Safaricom and Vodacom in 2019 formed a joint venture with Vodacom and acquired the intellectual property rights to M-Pesa from Britain’s Vodafone.

Apart from developing new products based on the M-Pesa platform, Safaricom and Vodacom also want to launch into other African markets.

M-Pesa is currently offered by Vodacom majority-owned subsidiaries in Tanzania, Mozambique, Lesotho and Democratic Republic of the Congo (DRC). Vodacom also owns an indirect stake in M-Pesa’s business in Kenya through its 35 percent stake in Safaricom.

Vodafone holds a 5 percent stake in Safaricom.Vodacom has a market capitalisation of about Sh1.8 trillion, slightly ahead of Safaricom’s Sh1.5 trillion.

Kenya Airways has more morning slots at the country’s airports for domestic flights than its rivals, giving it an unfair advantage in winning customers and setting ticket prices.

The Competition Authority of Kenya (CAK) says the national carrier and its wholly-owned subsidiary Jambojet are best placed to serve customers who mostly prefer morning flights for business or leisure travel.

“Landing and take-off time-slots have an effect on the average daily prices in the domestic market. Therefore, equitable allocation of time slots is essential for price competition,” the regulator said in a report under the auspices of the African Competition Forum (ACF).

“Jambojet and Kenya Airways have more morning slots in comparison to other players in the domestic market, which raises competition concerns.”

The regulator did not, however, say how many morning slots Kenya Airways and Jambojet have. The two airlines have a combined 36 percent market share of domestic flights.

Morning flights are the most popular among travellers and are sometimes priced higher by hundreds of shillings compared to other flights.

Most of the domestic flights originate or terminate at the Jomo Kenyatta International Airport (JKIA) where Jambojet and KQ, as the national carrier is known by its international code, operate from.

“In the domestic air commercial passenger market, the JKIA has the largest share with 32 percent domestic departures, 37 percent domestic arrivals, 94 percent international arrivals and 89 percent international departures,” the report says.

KQ and Jambojet’s rivals include Fly540, AirKenya, Slverstone Air and Skyward Express.

The cross-country airlines study by ACF found that KQ charges the highest fares on average for both domestic and international flights compared to other carriers operating in Africa.

KQ had higher fares on most routes where it has competition, though there are a few instances where its rivals charge more.“Kenya Airways has the highest average passenger price per kilometre (APPK) for all its domestic, regional and international routes,” the report by the ACF says.“In addition, the routes for the Tanzania markets from Nairobi have higher APPK than international routes, which are longer distances.”Kenya Airways’ average price per kilometre on the Nairobi-Johannesburg route, for instance, was Sh23.8 compared to Sh22 charged by South African Airways (SAA).The report found that many factors influence the setting of ticket prices including competition, government support and bilateral agreements.

NAIROBI, Kenya October 25 – Equity Bank has clinched Africa’s best bank for Small and Medium Enterprises (SMEs) title during the 2021 Euromoney awards.

East African banks were commended for leading the way in SME financing in Africa with Equity Bank hailed for its continued support of its clients with lending rising by 30 percent to USD 4.8 billion in 2020.

“Lately, Equity Bank’s SME lending has focused on unsecured working capital financing, with a specific focus on supply chain financing in agriculture, manufacturing, fast-moving consumer foods, and healthcare,” a statement issued read in part.

Euromoney said that Equity has “continued to access credit-risk guarantees as well as senior and subordinated funding from the International Finance Corporation (IFC) and development finance institutions in Europe – arrangements specifically designed for SMEs, including female entrepreneurs and agricultural value chains.”

Equity Group Managing Director and CEO, Dr. James Mwangi, said that the award reinforces and cements the Bank’s vision, of championing the socio-economic prosperity of the people of Africa.

“With support from various partners, Equity Group has strongly positioned itself to support SMEs (Small and Medium Enterprises) to keep their lights on during the prevailing COVID-19 pandemic which slowed down the economy and negatively impacted the cashflows of enterprises.

He said that the bank demonstrated its commitment to walking the journey with its customers, and its empathy with their socio-economic situation necessitated by the pandemic.

“Equity has fortified its product offerings by providing them with customized, flexible, and integrated banking solutions, for both business owners and employees,” the bank said.

In 2020, Equity received 3 Euromoney awards in the Best Bank in Africa, Best Digital Bank, and Excellence in Leadership award categories.

African aviation is going through a period of notable transition. With this shift, analysts have been looking at the market’s pricing. As a result, a report has shown that in Africa, Kenya Airways charges the most for its tickets. The Competition Authority of Kenya (CAK) is one of the authorities that took part in the study. Photo: Getty Images. The top of the crop

The African Competition Forum (ACF) has shared a report that studied the aviation industries of 24 countries in Africa. The study looked at which airlines charged the highest average fares on domestic and international operations.

The conclusion was that Kenya Airways charged the highest on most routes where it has competition. In the vast majority of cases, it charged higher than the likes of South African Airways, Ethiopian Airways, and Air France.

Kenya Airways held the highest average passenger price per kilometer (APPK) for all its national, regional, and international routes. Moreover, Tanzanian routes had higher APPK than services routes, which traveled farther. The study looked at data between the months of November 2019 and March 2020. Photo: Getty Images. Looking at the figures

Taking a route as an example, the average price per kilometer on the Nairobi-Johannesburg route was Sh23.8. Meanwhile, South African Airways (SAA) charged Sh22. (1 Kenyan Shilling is 0.0090 US Dollar)

“Prices charged by two operators on this route are visibly different for both economy and business class categories. Kenya Airways prices are 21 percent higher than SAA prices for economy class tickets,” ACF’s report highlights, as shared by Business Daily .

“The Nairobi-Paris route is served by Air France and Kenya Airways, their prices have a difference of Sh5,000, Kenya Airways price being more. KQ charged Sh15.6 per kilometer on the Nairobi-Addis Ababa route, higher than Ethiopian Airlines’ Sh13.2.” South African Airways charged higher than Kenya Airways when it came to business class, with the flag carrier of South Arica charging at around 39% higher than its competitor. Photo: Getty Images Get your boarding pass to the flight of the year. The Future Flying Forum is taking off soon! All eyes on Africa

Kenya Airways has been showing its intention of expanding its presence in fellow African nations in recent months. For instance, Congo Airways has begun wet leasing two Embraer E190 aircraft. Kenya Airways has also been in talks with South African Airways about forming a pan-African carrier .

The likes of […]

A KQ Dreamliner aircraft. FILE PHOTO | NMG Kenya signed the deal with the US on February 5, 2020 proposing to revise an earlier agreement inked in Washington DC on June 8, 2008.

The pact will also allow national airlines such as Kenya Airways to access US routes and the American carriers to access the Kenyan market.

FedEx is seeking to establish an operation base at the Jomo Kenyatta International Airport.

Parliament has backed a Cabinet decision to amend the air services agreement between Kenya and America that will see Kenya Airways expand its route network beyond New York.

Kenya Airways is currently operating scheduled passenger air services between Nairobi and New York.

Kenya signed the deal with the US on February 5, 2020 proposing to revise an earlier agreement inked in Washington DC on June 8, 2008.

The pact will also allow national airlines such as Kenya Airways to access US routes and the American carriers to access the Kenyan market.

Transport Cabinet Secretary James Macharia told MPs that no airline from the US is flying into Kenya.

He said ratification of the agreement will allow the Federal Express Corporation (FedEx) of the US which had expressed interest in starting cargo operations and establish a base in Kenya.

FedEx is seeking to establish an operation base at the Jomo Kenyatta International Airport.

“It is in the interest of the country to ratify the agreement to allow the airlines to expand their route network and engage in commercial arrangements as well as create job opportunities,” Mr Macharia said in a memo.Transport ministry said ratification of the agreement will enhance trade and commerce, tourism, market access and connectivity, investment interests and mutual cooperation between the two States.The National Assembly’s Transport committee, in a report to the House said commencement of FedEx cargo operations and a base in Kenya would have a multiplier effect on the Kenyan economy as it will open up immense opportunities for Kenyans.The team said the agreement will open expanded operations and markets for Kenya and US air operators, facilitate the movement of goods, passengers and mail, offering more flexibility in meeting demands and customer needs.The committee resolved to recommend to the National Assembly to approve the ratification of the treaty as it is in Kenya’s best interest.


Allianz SE

Group Communications and Reputation

Media Release

Allianz completes acquisition of majority stake in Jubilee Insurance Company of Uganda Limited Transaction is part of agreement signed with Jubilee Holdings Limited (JHL) in September 2020

Kenya transaction also completed. Tanzania, Burundi and Mauritius to follow, subject to regulatory approvals.

Kampala, Uganda, October 25, 2021

On Friday October 22, 2021, Allianz, one of the world’s leading insurers and asset managers, became the majority shareholder in Jubilee Insurance Company of Uganda Limited after completing the transaction to acquire a 66% stake in the company from Jubilee Holdings Limited (JHL), East Africa’s largest insurance group . The stake acquired by Allianz represents 29,700,000 ordinary shares of Jubilee Insurance Company of Uganda. JHL will retain a 34% stake, or 15,300,000 ordinary shares, in the company.

The General Business of Jubilee Insurance Company of Uganda Limited will change its name in due course to Jubilee Allianz General Insurance Company Limited , subject to approvals.

This is the second acquisition to be completed as part of an agreement announced on September 29, 2020 wherein Allianz agreed to acquire the majority shareholding in the short- term general (property and casualty) insurance business operations of JHL in five countries in Africa, namely Kenya, Uganda, Tanzania, Burundi and Mauritius. The first acquisition, in Kenya, was completed on May 4, 2021. The closing of the transactions in Tanzania, Burundi and Mauritius will follow shortly, subject to regulatory approvals.

Coenraad Vrolijk, the Regional CEO of Allianz Africa, says: "We are really proud of this acquisition and we are looking forward to working together with Jubilee to build out the best general insurance company in Uganda and in East Africa."The partnership, which combines Allianz’s 130 years plus of experience in insurance and asset management with Jubilee’s regional knowledge and network, aims to bring world -class insurance to the East African markets. Allianz SE Chairman of the Superv isory Board: Michael Diekmann. Board of Management: Oliv er Koeniginstr. 28 Bäte, Chairman; Sergio Balbinot, Andreas Wimmer, Dr. Barbara Karuth-Zelle, 80802 Munich; Germany Dr. Klaus-Peter Röhler, Iv an de la Sota, Giulio Terzariol, Dr. Günther Thallinger, Phone: +49 89 3800 18475 Christopher Townsend, Renate Wagner (Release / Stand 10.2021). For VAT-Purposes: Fax: +49 89 3800 2114 VAT-Registration Number: DE 129 274 114; Insurance serv ices are exempt f rom VAT. www.allianz.com/news Allianz SE, Munich, Comm.Reg.: Munich HRB 164232 InternalNizar Juma, Chairman of JHL, says: "The successful completion of the […]