Government Securities

Central Bank of Kenya
MarketsNews
Otiato Guguyu

Is CBK yield curve inverting signaling recession?

Short term bonds and bill rates are slowly rising above longer dated government papers setting the stage for what is called an inverted yield curve that is traditionally used to signal oncoming recession. Pressure to repay local loans have pushed short-term interest rates above 11 percent on the three, six and one-year Treasury Bills even as three short-term bonds costs rose above 14 percent. An inverted yield curve occurs when yields on shorter-dated Treasuries rise above those for longer-term ones suggesting that while investors expect interest rates to rise in the near term, they believe that higher borrowing costs will eventually hurt the economy. Analysts…

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Co-op Bank CEO and Group Managing Director Gideon Muriuki.
MarketsNews
Otiato Guguyu

Coop Bank first quarter profit up on double-digit customer loan growth

A double digit loan growth to the private sector has handed Cooperative Bank a five percent jump in net profits to Kes6.1 billion in the three months to March this year up from Kes5.8 billion in a similar period last year. Coop Bank saw customer loans jump 11 percent to Kes360.1 billion up from a growth of 8 percent in a similar period last year. Increased private sector loans saw the bank earn Kes10 billion in interest income up from Kes8.9 billion last year. The lender also made extra money from fees and commission on loans of Kes3.3 billion up from Kes2.5 billion in the…

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Equity Group
CorporateNews

Equity’s first-quarter profit up 8 percent to Sh12.8 billion

Regional lender Equity Group has reported an eight percent jump in net earnings to Kes12.8 billion in the period ended March 30 on higher income. In the period under focus, the lender saw a 21 percent surge in interest income to close the quarter at Kes32.4 billion compared to Kes26.7 billion reported during the comparable quarter last year. “Customer deposits grew to Kes1.11 trillion up from Kes900 billion while the loan book grew to Kes756 billion up from Kes623 billion,” Equity Group CEO Dr James Mwangi said. Equity Group’s net loans went up by 21 percent to Kes756 billion from Kes623.6 billion. “Our NPL is…

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KCB Govt securities
EconomyNews
Otiato Guguyu

Banks exposure to GoK debt cut to a decade low

Local Kenyan lenders are holding the smallest portion of state debt in almost ten years as banks dump government securities on rate hikes, heightened risk of default and the possibility of restructuring. Central bank data shows the portion of domestic debt held by banks stood at 45.64 percent in April down from 54.8 percent in June 2020.   The last time banks held less than 50 percent of domestic debt was 49.4 percent in March 2014, and have been accumulating risk free state debt over the decade, (especially during the rate cap era) to a high of 57.8 percent in July 2015. Kenyan banks hold Kes2…

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