Banking

LAGOS (Capital Markets in Africa) – Nigeria turned the screws even tighter on lenders by increasing the amount of money they need to park with the central bank for the first time in almost four years in an effort to tame inflation. The West African nation’s central bank raised the cash-reserve requirement for lenders to 27.5% of total deposits, from 22.5%, to curtail excess liquidity in the banking sector, Governor Godwin Emefiele told reporters Friday…

LAGOS (Capital Markets in Africa) – In August, Google announced a global crackdown on Android apps that offer short-term loans, saying it wanted to protect consumers from what it called “deceptive and exploitative” terms. But five months later, payday-style applications offering fast money for one or two weeks are still easy to find in many countries on Google Play, the company’s marketplace for Android apps. Some charge interest rates that can exceed 200% annualized. Lending apps…

LONDON (Capital Markets in Africa) – A closely watched measure of U.K. economic activity unexpectedly surged to the highest level since 2018 in January, potentially undermining the case for a Bank of England interest-rate cut next week. IHS Markit’s flash index for output across the whole economy jumped to 52.4 as firms cited reduced political uncertainty in the wake of Boris Johnson’s decisive election victory. That’s up from 49.3 last month. The Purchasing Managers Indexes had…

ACCRA (Capital Markets in Africa)~ – Former UBS Group AG trader Kweku Adoboli fought to avoid deportation from the U.K. to the nation of his birth after his conviction for a $2.3 billion loss at the Swiss bank. Now, he is seeking a comeback in Ghana with a plan to kick-start its mortgage-backed bond market. The 39-year-old was extradited to the West African country in November 2018 after being jailed in 2012. He spent the first nine…

JOHANNESBURG (Capital Markets in Africa) – South Africa’s central bank didn’t consider easing policy by more than 25 basis points last week, despite the flexibility it has with interest rates, Governor Lesetja Kganyago said.   “As a small open economy, we don’t have the problem that the developed world has where monetary policy is at the zero lower- bound, we have the flexibility to do things,” Kganyago said in an interview with Bloomberg TV at…

NEW YORK (Capital Markets in Africa) – In the court of investor opinion, the verdict is in. The Federal Reserve is guilty of quantitative easing. Never mind that Chairman Jerome Powell tells everyone his efforts to shore up funding markets are “in no sense” QE. Try as policymakers may, they’ve lost the ability to convince people that Treasury purchases aren’t at least partially why the Dow Jones Industrial Average is up almost 4,000 points since late…

LAGOS (Capital Markets in Africa) – Central bankers in sub-Saharan Africa are likely to focus more on domestic factors than global developments when they decide on interest rates in the next two weeks. Most will likely opt to pause. Since the monetary policy committees of some of the region’s key economies last met, data showed that South Africa’s economy contracted in the third quarter, Nigerian food inflation quickened due to border closures and in Ghana,…