The Editorial Team |

Absa’s Retail-Banking Push Starts Paying Off as Profit Rises

JOHANNESBURG (Capital Markets in Africa) – Absa Group Ltd.’s push to reclaim market share lost while under the control of Barclays Plc is beginning to pay off at the South African lender’s main retail-banking business. First-half net income climbed 5.4% to 7.64 billion rand ($500 million) as Absa provided more personal loans and credit cards, while boosting the revenue it generates from fees and commissions, the Johannesburg-based company said in a statement Tuesday. The improvement at its…

Cyril Ramaphosa Is Running Out of Time, Options in South Africa

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JOHANNESBURG (Capital Markets in Africa) – When Cyril Ramaphosa succeeded Jacob Zuma as South Africa’s president, he promised a “new dawn” after nine years of misrule that hobbled the economy. Eighteen months later, hopes have dissipated that the former labor union leader can orchestrate a turnaround. The economy shrank the most in a decade in the first quarter of this year; 38% of the workforce can’t find jobs or have given up looking; and massive bailouts for the debt-stricken…

As Gold Surges, So Does Illegal Mining Tied to Crime and Illness

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LAGOS (Capital Markets in Africa) – The gold rally fueled by the U.S.-China trade war is unleashing a growing wave of illegal miners who are increasingly pushing into fragile environments that range from Latin America’s Amazon to South Africa. Bullion has surged 18% over three months to the highest in six years. While that’s good news for mining companies, it’s spurring a burst of illegal prospecting that has helped fuel drug trafficking and organized crime within some of the…

U.K. Doesn’t See EU Moving on Brexit for at Least a Month

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L;ONDON (Capital Markets in Africa) – The U.K. government doesn’t expect the European Union to shift its position on Brexit for at least a month, a person familiar with the matter said. Prime Minister Boris Johnson is insisting the EU must reopen the Withdrawal Agreement it negotiated with his predecessor, Theresa May, and drop the so-called Irish backstop, a fall-back position designed to keep the border with Ireland open. That’s something EU leaders have said they won’t countenance. Johnson has…

Facebook Funds Startup to Bring More Commerce to Social Networks

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LAGOS (Capital Markets in Africa) – Facebook Inc. is participating in a $125 million fundraising for an Indian startup that is aiming to bring more commerce to social networks like, well, Facebook. Meesho, based in Bangalore, is what’s known in the tech industry as a social commerce startup, allowing people to build connections online and then sell through services such as Facebook and its WhatsApp and Instagram services. The funding round was led by South Africa’s Naspers…

Discovery Extends Slump on South African Health-Plan Concerns

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JOHANNESBURG (Capital Markets in Africa) – Discovery Ltd. extended its slump in Johannesburg trading, dropping the most since December 2015, as some investors fretted over the outlook for the medical insurance administrator under South African plans to shake up the country’s health insurance system. Discovery fell as much as 11% Monday before paring the decline to 5% as of 1:47 p.m. At its lows for the session, Discovery was heading for its worst two-day plunge on record….

The Market Has Already Downgraded South Africa to Junk

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JOHANNESBURG (Capital Markets in Africa) – Moody’s Investors Service hasn’t said it, but investors already think it: South Africa’s credit is junk. The company, which rates South Africa’s debt Baa3, the lowest investment level, is due to review its assessment in November. Given Eskom Holdings SOC Ltd.’s financial woes and its implications for government debt, the market is pricing in a downgrade. These three charts show how traders view the country’s fiscal outlook: The premium…

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