Banking

NEW YORK (Capital Markets in Africa) — Jerome Powell doesn’t want to talk about scaling back massive Federal Reserve asset purchases — at least not yet — but it’s only a question of time before the discussion resumes and that might not be a bad thing. The Fed chair told reporters on Jan. 27 that “the whole focus on exit is premature” — a clear call to his colleagues to focus on the economic damage…

LONDON (Capital Markets in Africa) — Young bankers waiting to learn when or whether they might be relocated to the European Union can take some solace from the fact that oftentimes, their bosses also don’t know their own fate. A senior banker hired to work in London last year was asked just weeks later to pack his bags and move to Europe. Some trading managers at one U.S. bank still don’t know whether they’ll be…

ACCRA (Capital Markets in Africa) — The Bank of England is preparing to take a significant step into the debate on whether negative interest rates should be used to stimulate the coronavirus-stricken U.K. economy. The central bank this week is due to publish the results of 160 detailed responses to a consultation about how borrowing costs could be pushed below zero for the first time since it was founded in 1694. The controversial policy, already…

LAGOS (Capital Markets in Africa) — Risks related to climate change and social issues will intensify the most in the next two years, finance executives predicted in a survey, and firms will have to find ways to cope. Environmental, social and governance issues topped the list of risk managers’ concerns in a Deloitte poll to be released on Monday, followed by cybersecurity and credit matters. More than half of the 57 firms surveyed were banks…

LAGOS (Capital Markets in Africa) — With many headlines competing for the financial world’s attention already this year, it would be easy to overlook one of the most significant changes that will take place in 2021: the end of Libor in new contracts. Once dubbed “the world’s most important number,” Libor is a benchmark interest rate with mind-boggling reach, impacting trillions of dollars in business loans, student loans, mortgages and more. Although Libor’s use is pervasive,…

NAIROBI (Capital Markets in Africa) — Kenya received debt repayment suspensions for a total of $600 million from China and the Debt Service Suspension Initiative and has requested the Group of 20 to consider a similar freeze for amounts expected after June, according to the central bank. The amount suspended was due in the first half of 2020 and will be repaid over five years, Governor Patrick Njoroge told reporters in the Kenyan capital, Nairobi….

LAGOS (Capital Markets in Africa) — The Nigerian government has become dependent on central-bank borrowing and will struggle to wean itself off the copious money printing that has raised concerns about the health of Africa’s largest economy, according to market observers. After revenue collapsed during the oil shock of 2015, Africa’s biggest crude producer turned to the central bank, borrowing about a third of its debt from the apex lender to cover a budget deficit…