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Satchu's Rich Wrap-Up
Wednesday 18th of May 2016

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Saturday 28th May #Mindspeak will host the @cbkkenya Governor Patrick
Njoroge @Njorogep

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The Tiny Cayman Island Holding $265 Billion in Treasuries

The Cayman Islands, where more hedge funds are domiciled than anywhere
else in the world, held $265 billion of Treasuries as of March, up 31
percent from a year earlier, according to data the U.S. Treasury
Department released Monday. It was the first time that the U.S.
released details of bond holdings among OPEC and Caribbean countries,
and it came in response to a Freedom-of-Information Act request
submitted by Bloomberg News.

About 60 percent of the world’s hedge-fund assets are domiciled in the
Cayman Islands, according to a 2014 report by consulting firm Oliver
Wyman & Co.

"A robust regulatory regime and no or low entity-level taxation
allowed the Cayman Islands to build a long-lasting reputation as a
global hedge funds hub," according to the report.

Home Thoughts

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What the killing of Mustafa Badreddine means for Hezbollah and the future of the Middle East
Law & Politics

There is no official record of Badreddine’s existence . No passport,
no driver’s licence, or bank accounts have been found in his name and
very few photographs have been discovered. The special tribunal for
Lebanon, sitting in the Hague, investigating the assassination of
Lebanese premier Rafiq Hariri described him as an “untraceable ghost”.


Hezbollah have achieved a kind of parity with Israel. No-One else has.

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Currency Markets at a Glance WSJ
World Currencies

Euro 1.1286
Dollar Index 94.76
Japan Yen 109.09
Swiss Franc 0.9823
Pound 1.4434
Aussie 0.7284
India Rupee 66.915
South Korea Won 1182.49
Brazil Real 3.4907
Egypt Pound 8.8795
South Africa Rand 15.6689

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Gold 1 Year Chart INO 1275.37 [Buy on Dips for a move to 1,350.00]

West Texas Intermediate for June delivery gained as much as 27 cents
to $48.58 a barrel on the New York Mercantile Exchange and was at
$48.49 at 12:25 p.m. Hong Kong time. The contract gained 59 cents to
$48.31 on Tuesday, the highest close since Oct. 9. Total volume traded
was about 30 percent below the 100-day average.

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Funds Swing to Bullish on Robusta Coffee Amid Dryness Concerns

Speculators are bullish on robusta coffee for the first time in almost
nine months as dry weather threatens crops in Vietnam and Indonesia,
two of the largest producing countries.

Money managers were net-long 9,413 futures and options contracts as of
May 10, according to a report published by ICE Futures Europe on
Monday. A week earlier, they were net-short 1,144 contracts, after
holding a bearish position since the week ended Aug. 25.

Futures have climbed almost 10 percent this year in London, and
touched $1,686 a metric ton on Monday, the highest since August.
Output in Vietnam, the top grower of the robusta variety used in
instant coffee, may fall to a four-year low next season of 1.5 million
tons, according to a Bloomberg survey of eight traders and analysts
released last week. The harvest in Indonesia, the third-largest
producer, may slide 10 percent to 570,000 tons, a separate survey

"Concerns linger over robusta availability,” the International Coffee
Organization said in an e-mailed newsletter. "Reports of drought in
several robusta-growing regions have spurred speculation over
potential shortages."

Emerging Markets

Frontier Markets

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Congolese point accusing fingers at Zuma and Dlamini-Zuma Mail and Guardian

President Jacob Zuma has come under fire from Congolese government
critics, who accuse him of taking a hands-off approach to the
Democratic Republic of the Congo’s unconstitutional attempts to delay

The critics said this was because of his family’s business interests in the DRC.

African Union Commission chairperson Nkosazana Dlamini-Zuma is also
included in the jibes after she appointed former Togolese prime
minister Edem Kodjo to mediate in a national dialogue to resolve
disputes about the elections. Critics say this process supported DRC
President Joseph Kabila’s attempts to extend his two terms beyond
November, when he is supposed to step down.

They say the Constitution dictates that there should be elections by
November and there was nothing to negotiate. Kabila has argued that an
update to the voters’ roll was necessary, a process that would take
the country to well beyond the elections date.

The Kinshasa-based Le Potentiel newspaper this week slammed
Dlamini-Zuma, saying she knew from the beginning that she had
appointed Kodjo to a “mission impossible”. Kodjo is perceived to be
biased towards Kabila, and so is Dlamini-Zuma.

“The accusation against the AU Commission chairperson is the fact that
she works to favour the ruling party, to the detriment of the
opposition,” the paper said.

It alleged that Dlamini-Zuma was “receiving instructions from Pretoria
in exchange for benefits the DRC government give to the family of the
South African President Jacob Zuma”.

In 2010 Zuma’s nephew, Khulubuse Zuma, fronted a R100-billion oil deal
in the DRC, through a company that was registered in the British
Virgin Islands in his name. The Panama Papers leak confirmed this and
also revealed that the United States authorities were investigating
the deal.

“We would like to tell him to quit the DRC, because he is using the
Congo for his private business,” he said. “We want South Africa to
deal legitimately with the Congo, state to state, not individuals
taking advantage for their private interests.”

South Africa provided logistical support in the country’s 2011
elections, which included printing ballot papers. DRC opposition
supporters marched to the ANC’s Luthuli House headquarters in
Johannesburg that year because they said there were election

The DRC’s current elections problems are expected to feature high on
the agenda of the AU summit in Rwanda in July.


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Congo Scales Back Eurobond Plans as It Seeks World Bank Support

The Democratic Republic of Congo scaled back plans to sell $1 billion
of Eurobonds and instead asked multilateral lenders for direct
budgetary support after the collapse in commodity prices forced the
government to cut spending.

The World Bank will provide $250 million to $500 million of
assistance, in addition to $100 million from the AfDB, pending a
review in June by the International Monetary Fund of the country’s
macroeconomic framework, said Vincent Ngonga Nzinga, deputy chief of
staff in the prime minister’s office.

Congo is Africa’s biggest copper producer and the world’s largest
source of cobalt. It relies on the exports of the metals and other
natural resources like oil and gold to generate most of its revenue.
In the first four months of 2016, the government ran a deficit of 88
billion Congolese francs ($95 million) compared with a surplus of 181
billion francs a year earlier, as the collapse in commodity prices cut
state receipts. In response, the cabinet on May 4 approved a 22
percent budget cut, but said it will still need support to plug the

“We cannot maintain economic stability by only playing on the budget,
by reducing expenditure, that is why the government has contacted the
IMF and the World Bank,” Ngonga, who is also the prime minister’s
principal economic adviser, said in the capital, Kinshasa.

Prime Minister Matata Ponyo Mapon announced last year that the
government proposed to sell a debut Eurobond in 2016 to fund
infrastructure investments. The government was deterred from those
plans by the U.S. Federal Reserve’s decision in December to raise
interest rates and the experience of other Africa countries that have
issued Eurobonds in recent years, according to Ngonga.

“We should have launched the bond offer in April, but under current
conditions we decided it would not be wise,” Vincent Ngonga Nzinga,
deputy chief of staff at the prime minister’s office, said in an
interview May 13. “We would have to expect an interest rate of between
12 and 14 percent.”

Discussions between Congo and the multilateral lenders began in
Washington in April and will be concluded when an IMF delegation
visits Kinshasa in June. For the funding to be released, the IMF must
write a “comfort letter” to the World Bank that attests to the
long-term viability of Congo’s macroeconomic framework, Ngonga said.

Budgetary support would also allow the central bank to rebuild
dwindling foreign-exchange reserves, which fell to 1.19 billion on May
5 from $1.5 billion at the start of the year. Of those reserves, only
$280 million is immediately available to the bank.

“This is why it is more urgent for us to access this budgetary support
now,” Ngonga said, adding that the facility could be in place by

In the adjusted budget, which was discussed in parliament on Monday,
there is still a provision for 256 billion Congolese francs ($276
million) from a bond issue. The government expects this money is more
likely to come from the World Bank and the AfDB, according to Ngonga.

The IMF’s ability to approve multilateral budgetary support will also
depend on an assessment of current standards of economic governance in
the country. In 2012, the IMF canceled a $551-million loan program
with Congo after the government failed to publish details of a
copper-mining deal involving Gecamines and billionaire Israeli
investor Dan Gentler.

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South Africa All Share Bloomberg +3.62% 2016

Dollar versus Rand 6 Month Chart INO 15.6689


Egypt EGX30 Bloomberg +7.76% 2016


Nigeria All Share Bloomberg -6.94% 2016


Ghana Stock Exchange Composite Index Bloomberg -10.92% 2016 [3 Year Closing Low]


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Angolan author jose' Eduardo Agualusa poses with his book A General Theory of Oblivion in London, May 15.

Agualusa's novel set during the Angolan Civil War has been nominated
for the Man Booker International Prize.

What’s his book about?

A General Theory of Oblivion is set on the eve of Angolan independence
in 1975. A Portuguese expatriate, Ludovica Fernandes Mano, takes the
drastic step of sealing herself inside her apartment in the capital,
Luanda, for fear of what is to come. Ludo gets through the next almost
three decades by growing vegetables on her building’s terrace and
spends her hours listening to the radio for news of the outside world
while scribbling her thoughts into notebooks and eventually—once she
has to burn her tomes for firewood—onto the walls of her apartment.
She only re-emerges after almost 30 years of isolation following an
encounter with a young burglar, and finds the Angolan capital changed
beyond what she can imagine.

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.@CBKKenya staff receive threats over Imperial Bank audit @BD_Africa

“There are forces that wanted us to go the other way but we said ‘‘no
thank you for your advice’’. My staff have received numerous threats
to their lives,” the governor told the Senate Finance Committee
chaired by Mandera Senator Billow Kerrow.

“We understand what we have been dealing with. We can assure you that
we will do the audit without fear or favour despite the threats,” he
said, adding that the Sh39 billion that was looted in the Imperial
Bank heist is the new high water mark that makes Goldenberg scandal
look like a kids’ game.

Initial reports also indicated that Imperial Bank had a huge bad loan
book, fictitious deposits, unsecured insider lending and conflict of
interest by shareholders and directors.

Dr Njoroge said Imperial Bank directors had failed to co-operate with
the CBK on the reopening of the bank through their refusal to deposit
Sh10 billion as the first step to reviving the lender.

“They said they wanted to pump in Sh10 billion, but six months down
the line they have not deposited a shilling. Imperial Bank requires up
to Sh34 billion to be revived,” Dr Njoroge said adding that the lender
could have been reopened within a month of closure, but the directors
have shown little interest in reopening the lender.

“We had plans to reopen the bank, but without shareholders support, we
cannot go far. We have, however, not given up,” he said. Dr Njoroge
agreed with the committee that the CBK bank supervision unit may have
been complicit in the collapse of the three lenders.

“I agree that we may have been asleep. We needed to have barked much
more loudly. We have been doing hard internal thinking on why the
banks collapsed yet we had a supervision team,” he said.

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Kenya Shilling versus The Dollar Live ForexPros 100.85
Kenyan Economy

Nairobi All Share Bloomberg -0.27% 2016


145.31 -1.00 -0.68%

Nairobi ^NSE20 Bloomberg -4.30% 2016 [11 WEEK LOW]


3,866.97 -40.12 -1.03%

Every Listed Share can be interrogated here


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N.S.E Today

The Nairobi All Share rebounded +0.43 points to close at 145.74.
The Nairobi NSE20 Index bounced +11.45 points off a 10 week closing
Low to close at 3878.42.
Equity Turnover improved to clock 636.713m.

N.S.E Equities - Commercial & Services

Safaricom closed unchanged at 17.15 and closed out the session trading
17.25 +0.58%. Safaricom traded 1.536m shares. Investors have quite
properly looked through the recent Noise.

N.S.E Equities - Finance & Investment

Kenya Commercial Bank was the most actively traded share at the
Exchange and firmed +0.609% close and 41.25 and stretched as high as
41.75 +1.83% at the Finish. KCB traded 3.679m shares. KCB is well
supported and the Rights Issue will be fully taken up.
COOP Bank reported Q1 2016 Earnings before the Opening Bell, where Q1
PBT accelerated +14.144% off the back of a +16.70% increase in Loans
and Advances to customers which clocked 213.72b. Net Interest Margins
declined 30 basis points due to a faster rise in the Cost of funds.
Loan loss provision were 3.113946b vs. 2.400400b +29.726%. COOP Bank
eased -0.27% to close at 18.40 and traded 1.600m shares.
Equity Bank rebounded +1.27% to close at 40.00 and on meaningful
volume of 3.804m shares.
Standard Chartered was up-ticked +1.522% to close at 200.00 and was
trading at 205.00 +4.06% at the Finish. StanChart has plenty of scope
to the Upside. At a recent event in Nairobi, The StanChart CEO
specifically cited Kenya as an Outperformer in the Portfolio.

The Nairobi Securities Exchange issued a Notice where the following
restrictions were introduced

1. An Individual or Private Co. shall not hold more than 5% of the
equity share capital.
2. A Public Company shall not hold more than 10% of the equity share capital.
3. Trading Participants shall not cumulatively hold more than 40%.

I suspect the Authorities were concerned around a possible Stake
build-Up and this essentially takes some ''take-over'' premium out of
the price. The NSE firmed +0.89% to close at 28.25 and is +14.14% in

N.S.E Equities - Industrial & Allied

Bamburi Cement traded a block of 500.000 shares all at 190.00 and
unchanged. Bamburi Cement is +8.571% in 2016 and is an Outperformer at
the Exchange in 2016. Buyers have swelled and volumes in 2016.

BAT firmed +0.73% to close at 825.00 and traded 62,000 shares.

KenGen eased -0.75% to close at 6.60 and fractionally below the rights
issue price.

by Aly Khan Satchu (www.rich.co.ke)
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May 2016

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  aly khan says:
may 19th, 2016 at 11:44 am
A Video Teaser @Njorogep @cbkkenya Governor #Mindspeak