Author: Otiato Guguyu

EAC & The Horn
Otiato Guguyu

East Africa Bank turns cautious as shareholders face turmoil

East Africa Development Bank’s (EADB) reliance on cheap long-term funds will protect its balance sheet even as it shareholders, the governments of Kenya, Uganda, Tanzania and Rwanda face tough economic conditions. Rating agency Moodys has affirmed the EADB’s Baa3 long-term issuer rating and maintained the stable outlook on grounds the bank had taken risk mitigation measures rather than on the strength of its shareholders. Moodys, which recently cut Kenya’s credit rating from B2 to B3 said the country’s negative rating, Rwanda’s B2 stable, Tanzania’s B2 positive and Uganda’s B2 negative means the shareholders are unlikely to intervene if the bank came under pressure owing to

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Mithika Linturi
CountiesNews
Otiato Guguyu

Government signals Sh4000 maize with Sh4Bn allocation

The Cabinet approved Kes4 billion to purchase maize from farmers to mitigate price fluctuation which indicates the Kenya Kwanza government is projecting to set prices at Kes4,000. The government says it will set the price on maize this week as one of the country’s top buyers as its seeks to shore up strategic reserves. Agriculture minister Mithika Linturi had indicated government would buy a million bags of maize which would put the estimated price per bag at Kes4000. This is despite farmers stating that to break even, the government should set the price of maize at not less than Kes5,500 per 90kg bag. Kenya maize farmers are under pressure…

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Family Bank
News
Otiato Guguyu

Bank shareholders awaiting dividends get cash calls instead

Mid-tier banks in Kenya are turning to their stakeholders for vital support as the Shilling’s fluctuations drive operational costs to new heights, resulting in an uptick in loan defaults, largely attributed to high interest rates. One notable example is Family Bank, which recently unveiled a strategic capital-raising initiative. As part of a comprehensive $100 million (Kes14.7 billion) expansion scheme aimed at ascending to tier I status, the bank is issuing an additional 800 million shares and mobilizing funds through a rights issue. In parallel, Victoria Commercial Bank (VCB) has made its intentions clear, announcing its quest to raise an additional Kes1.5 billion in tier-one capital…

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Technology
Otiato Guguyu

Bongo live ‘Beem’s into Kenya to declutter business socials

When Taha Jiwaji first stepped into his father’s computer retail shop in bustling Dar es Salaam city, the old man did not imagine over a decade later he would be in Nairobi watching his son bring into Kenya a tech solution that helps businesses declutter social media platforms. Last week, Taha’s father, Mr Mustafa Jiwaji, sat beaming with pride at the back of a conference room in Nairobi’s Radison Blu Hotel. He watched as his son eloquently explained this sophisticated concept to potential customers and the media. For Mustafa, it must have felt like a surreal trip down memory lane. Back in the day, when

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MarketsNews
Otiato Guguyu

Why banks will beg for your deposits

Kenyans have a huge opportunity to set the price of their savings as banks, desperate for cash, lure deposits in a market with very competitive options. Deposit rates have jumped to 7.8 percent in June, a five year high as Banks scrambled for investors to deposit money in their accounts to facilitate their fractional lending. Fractional Banking is a banking system that requires banks to hold only a portion of the money deposited with them as reserves. The banks then use the customer deposits to make new loans. For a long time Banks have been holding the upper hand given the healthy supply of money…

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CorporateNews
Otiato Guguyu

How Kakuzi wanted to shut down media from covering transfer pricing probe

A week after Kakuzi management were summoned by the Capital Markets Authority, the listed agricultural exporter rushed to the markets tribunal to block the inquiry and gag the media from reporting. Court tribunal documents show Kakuzi attempted to invoke section 13 (2) of the Capital Markets Act that barred the regulator from disclosing returns and information demanded during investigations to any person save for other regulators. The tribunal chaired by Paul Lilan agreed to freeze the CMA inquiry and maintain status quo but declined to gag the media over coverage of Kakuzi insider dealings. Kakuzi officials have been fighting to block transfer pricing probes for…

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Fuel Prices
EconomyNews
Otiato Guguyu

Global oil surge and IMF clean energy agenda fuels Kenya’s inflation

The Energy and Petroleum Regulatory Authority (EPRA) has increased the cost of Super Petrol to Kes211.64, Diesel to Kes200.99, and Kerosene to Kes202.61 per litre in Nairobi. Epra announced the maximum allowed petroleum pump prices in Nairobi would increase by Kes16.96 on Super Petrol, by Kes21.32 per litre on diesel and Kes33.13 on kerosene ushering in a new round of cost pressures on consumers as transport costs is transmitted through the entire economy. Cost of consumer products Although inflation has been coming down on bumper food harvest, cost pressures from expensive fuel and declining shilling is about to hit the market as fuel prices transmit…

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Forced Roaming
MarketsNews
Otiato Guguyu

Ruto wants Sh5,000 treasury bills

President William Ruto has asked the Central Bank of Kenya (CBK) to bring down the minimum amount you can lend to the government to Kes5,000 from the current Kes50,000 limit on Treasury Bonds. President Ruto said he has given Central Bank of Kenya Governor Kamau Thugge a month to find a way of bringing down the threshold for investors as part of the strategy to open up investment in government securities to the public. He was speaking at the launch of the Dhow CSD, a digitized platform for operating an account at CBK for trading bonds and bills. The President said CBK should also incorporate…

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Mombasa water
News
Otiato Guguyu

Mombasa residents will pay more for water to foot 15-year-old World Bank loan

Mombasa residents will pay more for water to foot a 15 year old World Bank loan under new tariffs set to be implemented next month. The Coast Water Works Development Agency told the National Assembly Public Investments Committee on Commercial Affairs and Energy led by Pokot South MP David Pkosing they will introduce a component of the loan in new water tariff set to commence in October. The World Bank lent Kenya Kes4.5 billion in 2008 was repayable in 13 years with effect from 30 March. 2013 at an interest rate of 1.5 percent per annum. Kenya was supposed to pay $4,906,636 that comprised of…

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EABL
FeaturedVideo
Otiato Guguyu

Govt, Counties brew illicit rules to block bar licenses

I once read somewhere, you can tell a society’s values by what they chose to dedicate their tallest and grandest buildings to, and in Kiambu town, they mean business in every sense of the word. Kiambu town is squashed together over a little dirt in the middle of a sea of tea and coffee. It’s inhabitants huddled so close together that the town has learned the value of every inch of space. We got lost in the directions that sent us to a petrol station, the only one I have ever seen that uses the same entry point as an exit. We found ourselves on…

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