Finance

LAGOS (Capital Markets in Africa) –  The bonds of emerging-market nations are entering distressed territory at an alarming rate as the soaring dollar raises the prospect of government defaults. Fifteen nations now have dollar-bond spreads of at least 1,000 basis points over U.S. Treasuries, a level many investors consider to be the threshold for debt to be classed as distressed. And that doesn’t even include Lebanon, which defaulted this month, and Argentina, which has begun restructuring talks with bondholders. At the…

JOHANNESBURG (Capital Markets in Africa) – The debate around South African interest rates has now moved from whether the central bank will cut on Thursday to by how much. Of 21 economists in a Bloomberg survey, 11 predict a 50 basis-point reduction, while the balance expects the rate to be lowered by 25 basis points. Forward-rate agreements show traders have switched from pricing in a less than 50% chance of a 25 basis-point cut three…

LAGOS (Capital Markets in Africa) – Emerging-market sovereign bonds tumbled as the prospect of billions of dollars in stimulus packages threatened to flood the market with new debt, and in some cases undermine already fragile finances. The extra yield developing nations need to pay to borrow dollars from abroad has doubled since the start of the year to 629 basis points — the highest since the global financial crisis. The prospect of a wave of…

NEW YORK (Capital Markets in Africa) -# The Trump administration has announced new steps to speed up testing for the coronavirus, after widespread warnings about a bottleneck in diagnosing cases that’s failing to provide a clear snapshot of the pandemic’s U.S. footprint. The Food and Drug Administration announced it had approved the first rounds of high-volume testing, as well as allowing New York state to authorize labs to expand testing on their own. The Trump…

NAIROBI (Capital Markets in Africa) – KCB Group Ltd., Kenya’s second-biggest bank by market value, is betting on recovering bad loans and issuing more credit to boost profit by at least 12% this year, Chief Executive Officer Joshua Oigara said. The lender’s 2019 earnings were dampened by a tripling in loan loss provisions, weighed down chiefly from souring mobile phone-based loans. Total non-performing loans jumped by 90%, the lender said on Thursday, while reporting full-year…

LAGOS (Capital Markets in Africa) – A combination of President Donald Trump’s unprecedented travel restrictions between the U.S. and Europe and underwhelming stimulus measures sparked a fresh exodus from risk assets in global financial markets Thursday. The rush to gauge the impact on the global economy and corporate earnings, a sense of disappointment at the lack of detail in the U.S. stimulus package and an impression that Washington has fallen behind the curve in its…

JOHANNESBURG (Capital Markets in Africa) – A judicial inquiry in South Africa recommended sweeping changes to laws governing Africa’s biggest fund manager after it found senior management, including former Chief Executive Officer Dan Matjila, flouted internal procedures. The investigation, led by retired Judge Lex Mpati, concluded there had been “substantial impropriety” at the state-owned Public Investment Corp., which manages 2.13 trillion rand ($130 billion) of state-employee pension funds. It found that the board had acted as a…