Banking | - Part 108

Nedbank Heads for Eight-Month High on Surprise Profit Increase

Johannesburg, Capital Markets in Africa: Nedbank Group Ltd., the South African lender controlled by Old Mutual Plc, reached the highest level in eight months after first-half profit rose, beating analyst estimates that had predicted a decline. The shares jumped as much as 8.3 percent on Monday before paring gains, leading returns on the seven-member FTSE/JSE Africa Banks Index. First-half earnings per share excluding one-time items climbed to 11.19 rand from 11.01 rand a year earlier as bad-loan impairments improved….

Kenyan Banks Seen Resisting Lower Loan Costs After Rate Cut

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NAIROBI, Kenya, Capital Markets in Africa: The Central Bank of Kenya’s reduction of the benchmark rate used by lenders to set borrowing costs may have caught commercial banks by surprise but they may find ways to dodge lowering lending rates. “Which bank would want to lend at a lower rate, taking more risk for lower returns?” Faith Atiti, a research analyst at Commercial Bank of Africa Ltd., said by phone from Nairobi. Banks will probably increase premiums and…

Pound Slumps as Egyptian Banks ‘Scrape Barrel’ Over FX Shortage

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CARIO, Egypt, Capital Markets in Africa: The Egyptian pound extended a record low on the black market, as tighter restrictions on the use of local debit and credit cards overseas and comments by the central bank governor stoked speculation of a devaluation. The pound fell to 12.99 per dollar on Tuesday from 12.02 last week, according to the average quote of five currency traders in Cairo and Alexandria. That’s the lowest since Bloomberg started tracking black…

Nigeria Raises Key Interest Rate to Lure ‘Lukewarm’ Investors in July

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LAGOS, Nigeria, Capital Markets in Africa: Nigeria raised its monetary policy rate to lure foreign investors and prop up its currency, even as the economy risks slipping into recession. The Monetary Policy Committee increased the key lending rate to 14 percent from 12 percent, Central Bank of Nigeria Governor Godwin Emefiele told reporters in the capital, Abuja, on Tuesday. That was in line with the forecast of two of the 15 economists in a Bloomberg survey. Two predicted a 100 basis-point…

Kenyan Expresses Interest in Buying Troubled Congo Lender

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NAIROBI, Kenya, Capital Markets in Africa: Commercial Bank of Africa Limited, Kenya’s largest closely held lender, expressed an interest in buying struggling Democratic Republic Congo lender Banque Internationale Pour l’Afrique au Congo. Commercial Bank of Africa sent a letter that was signed by the Nairobi-based company’s Group Managing Director Isaac Awuondo and dated June 30 to Congo’s central bank saying it was interested in expanding its footprint into the country by investing in the recapitalization of BIAC, according to a…

Kenya Pauses Monetary Easing, Sees Moderate Inflation Pressure

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NAIROBI, Kenya, Capital Markets in Africa: The Central Bank of Kenya maintained its benchmark interest rate at 10.5 percent with an eye on accelerating inflation and concerns that Britain’s exit from the European Union may trigger capital flight. The decision by the monetary policy committee led by Governor Patrick Njoroge was anticipated by seven of eight analysts surveyed by Bloomberg. One economist predicted a 50 basis point reduction at Monday’s meeting, following one percentage point cut at the previous gathering in…

South Africa May Move Rate Focus to Recession Risk

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Johannesburg, Capital Markets in Africa: South Africa’s rate-hiking cycle may be coming to an end amid the threat of the country’s first recession in seven years. After increasing the benchmark rate six times since the start of 2014, policy makers in Africa’s only Group of 20 economy are poised to keep it unchanged this week as a stronger currency gives them room to focus on the risks to growth. Those headwinds include weak export demand, the worst drought in…

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