Equity’s takeover of Spire the best way out, says CBK
Equity Bank’s plan to buy struggling Spire Bank is the best deal available in the market, the Central Bank of Kenya told Parliament yesterday.
CBK governor Patrick Njoroge told MPs that the deal is the best chance to protect the interest of depositors and creditors of Spire Bank. Mwalimu Sacco, which owns Spire Bank, inked a deal with Equity Bank to save the tier-three lender from liquidity challenges.
The agreement will see Mwalimu Sacco pay Equity an additional Sh422 million to cover liabilities.The top-tier lender will take over just under Sh900 million in assets and Sh1.3 billion in liabilities.
The half-a-billion-shilling difference, employee costs, claims and litigations amounting to Sh1.7 billion will be borne by Mwalimu Sacco. Dr Njoroge said time has come to ensure stability of Spire Bank through the buyout deal with Equity.
He said the CBK continues to urge a quick conclusion of the Equity Bank and Spire Bank deal saying it believes it is possible.
The High Court in October froze Equity Bank’s acquisition of Spire Bank until a deal is reached with the employees. “I believe this is the best chance for the teachers and I am happy Equity Bank is ready to clean up the mess,” Dr Njoroge told the Finance and Planning committee.
The CBK boss told lawmakers that Equity is interested in Spire because “it sees the investors in the bank as people who are its own customers and also in order to get the best outcome for the Mwalimu Sacco.”
(Source: Business Daily)
Air France to launch direct flights from Paris to Dar es Salaam
Air France is set to launch a new direct flight from Paris to Dar es Salaam in June 2023, as the airliner seeks to strengthen its presence in East Africa.
According to an announcement on the carrier’s website, they are set to have three weekly flights with effect from June 12.
“Over the course of a century, Dar es Salaam (literally “haven of peace”) has become one of East Africa’s main ports as well as Tanzania’s largest city. As the country’s economic hub, this cosmopolitan city is open to the world and has built a reputation in the arts and gastronomy. It is the main gateway to Tanzania,” Air France wrote in the announcement on why it unveiled new direct route from Paris to Dar.
The three flights per week between its hub at Paris-CDG and Dar es Salaam’s Julius Nyerere airport. Departures are scheduled for Mondays, Wednesdays and Saturdays at 10:20am to arrive at 20:15 in Zanzibar, depart at 21:45 and land at 22:20. Return flights will leave Tanzania’s financial capital at 11:50pm and land the next day at 7:55am in Paris.
The opening of Dar es Salaam service will therefore lead to an increase of flights to Zanzibar’s Abeid Amani Karume airport, which gains a third weekly rotation compared to last summer.
Air France will be without competition on this route, although Dar es Salaam is being served from Europe by its sister Royal Dutch Airlines -KLM with daily flight from Amsterdam, continuation of Zanzibar as well. Turkish Airlines also connects the largest city in Tanzania with Europe.
(Source: The Citizen)
BoU to regulate Saccos with UgShs1.5b in savings
Bank of Uganda has said it will, with amendments to the Microfinance Deposit-Taking Institutions Bill, 2022, start regulating at least 42 Savings and Credit Cooperative Societies (Saccos) whose savings are above UgShs1.5 billion. The regulation will be effected under the Micro Finance Deposit-taking Institutions (Registered Societies) Regulations, 2022.
Speaking during the second Central Bank Financial Stability Symposium, Dr Tumubweinee Twinemanzi, the Bank of Uganda executive director supervision, said Cabinet had already considered and approved the Microfinance Deposit-Taking Institutions (Amendment) Bill, 2022; and authorized the Minister of Finance to submit the Bill to Parliament.
“On [November 22], the minister presented the Bill for First Reading in Parliament. Key amendments proposed in the Bill include: Permitting [Micro Deposit-taking Institutions] to extend their services through agents, provide insurance services and products through Bancassurance and [offering] Islamic finance (Islamic microfinance), among others,” he said, noting that Tier 4 Microfinance and Money Lenders Act, 2016, the Central Bank is also mandated to provide supervisory oversight over Registered Societies with voluntary savings in excess UgShs1.5 billion and institutional capital of above Shs500m.
(Source: The Monitor)
Rwanda to become global services destination – report
A new report has highlighted Rwanda’s potential to become a global business services destination and create over 5,000 jobs in the next five years.
The report was released, on November 30, by Harambee Youth Employment Accelerator- an independent, not-for-profit social enterprise that works with individual businesses, government agencies, local and international donors, industry sector associations, youth-serving organizations, assessment specialists, behavior change experts, and technology providers. The organization aims to solve the youth unemployment challenge through partnerships.
The “Rwanda Global Business Services Case Study and Special Country Report” highlights the country’s value proposition and key information to investors and employers within the Global Business Services (GBS) sector.The report analyzes the gaps, needs, and what is required for an investor and employer to come to Rwanda.
It highlights Rwanda’s strengths, including ease of doing business, a strong and growing talent pool of young people, strong and reliable IT infrastructure, and a high level of service delivery.
The report also revealed some of the key business drivers that make Rwanda an ideal destination for Global Business Services employers.
These include Rwanda’s bilingualism in English and French, the government’s prioritization of the Global Business Services sector as an investment opportunity, the collaboration potential of key sector players, attractive investment incentives, and its capacity to flourish as a boutique near-shore services location.
(Source: The New Times)
Investment commission calls diplomats of foreign countries to promote Ethiopia’s Investment
The Ethiopian Investment Commission organized a discussion forum with a view to promoting Ethiopia’s investment opportunities to foreign investors. Ambassadors and economic and commercial attache’s of embassies of various countries based in Addis Ababa have participated in the forum. During the occasion, Ethiopian Investment Commission Commissioner, Lelise Neme said Ethiopia is the most favored investment destination in East Africa.
She further briefed the diplomats about the reforms being carried out to attract foreign direct investment, including the measures taken to improve the investment law and business climate aimed at opening up the various investment sectors and economic activities to foreign investors.
According to her, relaxing the investment regimes to facilitate a friendly business environment, removing regulatory obstacles that hamper business and privatizing the largest public enterprises were aimed at attracting more FDI. The logistic sector is partially liberalized with the view to attracting FDI with knowledge, experience and technology as well as management vital to the development of the nation, she said.
The removal of barriers to foreign investment will improve the efficiency of the logistic service and enhance the competitiveness of Ethiopia’s export, she added.
Noting the opening up of the telecom sector to foreign companies and the ongoing privatization processes of public enterprises including sugar factories, she said the government is committed to encouraging the engagement of foreign investors in Ethiopia.
World Bank Forecasts Economy to Grow 2.7pc in 2022
Somalia’s economy is expected to grow by 2.7 percent in 2022, down from 2.9 percent in 2021, amid a global environment characterized by multiple shocks, high volatility, and uncertainty, the World Bank projected on Tuesday.
The World Bank’s latest Somalia Economic Update report says a recovery in demand is expected in 2023 when most of the shocks currently dragging on the recovery are expected to dissipate.
“An uptick in consumption and investment, combined with faster growth of Somalia’s trading partners, supports a forecast of Gross Domestic Product (GDP) growth of 3.6 percent in 2023 and 3.7 percent in 2024,” says the report.
According to the World Bank, the economy rebounded with a GDP growth rate of 2.9 percent in 2021, up from a contraction of 0.3 percent in 2020.
The World Bank said this is despite significant shocks and factors that muted economic recovery, including delayed elections, drought, supply chain bottlenecks from COVID-19 closures, and increased insecurity.
World Bank Country Manager for Somalia Kristina Svensson said given the recurrent climatic shocks facing Somalia, the medium-term growth outlook remains highly uncertain, and the case for investments in social protection is stronger.
(Source: All Africa)