Chairman King

Absa Business News

Nigeria’s Distressed Banks: South Africa’s FirstRand & Standard Bank Show Interest in Buying

Jan 14

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FirstRandFirstRand Ltd. and Standard Bank Group Ltd., South Africa’s two biggest banking groups, have both registered with the Central Bank of Nigeria (CBN) to investigate buying distressed lenders in the West African country.

Standard BankThe timetable for buying any of the 10 Nigerian institutions that failed an audit last year will be determined by the CBN, FirstRand CEO Sizwe Nxasana said today. The Johannesburg-based bank said it may prefer to buy one of Nigeria’s “healthier” banks.

“There are opportunities across the board,” Nxasana, 52, said. “We are still looking at all the options.”

AbsaFirstRand first mooted its African expansion plans last June while Standard Bank is also looking to add to its assets in Nigeria. Additionally, ChairmanKing.com reported in September that Barclays/Absa was applying to open an office in Nigeria.

While the country’s banking crisis last August saw the central bank inject N620 billion ($4.1 billion) into 10 banks to cover bad debts, the economy’s growth potential means Nigerian institutions offer “nice opportunities,” investor Mark Mobius said last week. Read the rest of this entry »

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Standard Bank Looking at Nigeria for Possible Takeover Targets

Dec 15

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Standard BankStandard Bank Group Ltd., Africa’s largest lender, says it’s looking at Nigeria for possible acquisition opportunities as a banking crisis in the West African country slashes valuations.

“The current situation in Nigeria does present opportunities, and we are watching developments with interest,” said Erik Larsen, spokesman for Johannesburg-based Standard Bank, in an e-mailed response to questions today. “Nigeria is a key strategic market for Standard Bank.”

Stanbic IBTCStandard Bank already operates in Nigeria through its controlling stake in Stanbic IBTC.

Nigeria’s banking crisis began in August when the Central Bank of Nigeria (CBN) sacked eight chief executive officers and injected N620 billion ($4.1 billion) into those and two other distressed lenders to boost their capital and liquidity. Read the rest of this entry »

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What’s Next for Nigeria’s Banks?

Oct 29

Posted by Staff Writer in News | Post Comment

The Central Bank of Nigeria has an important role to play in efficiently regulating Nigeria's banking sector.

The Central Bank of Nigeria has an important role to play in efficiently regulating Nigeria's banking sector.

Since the audit results of the remaining 14 Nigerian banks was announced earlier in the month, there has been much speculation about foreign take-overs of the troubled institutions, as well as mergers within the sector. Going forward, the Central Bank of Nigeria (CBN) will also have to actively manage the financial health of the banks and make sure they don’t find themselves in such a situation again.

After the audit findings on the first 10 of Nigeria’s 24 banks were revealed in the middle of August, the market has been holding its breath for the results of the 14 remaining banks.

On 2 October, the Central Bank of Nigeria (CBN) announced that four more banks – Bank PHB, Equitorial Trust Bank (ETB), Spring Bank, and Wema Bank – were undercapitalized, in a poor liquidity position, and in what the CBN called a “grave situation”. A fifth bank – Unity Bank – was adjudged to have insufficient capital but a healthy liquidity position.

The CBN said it will inject N200 billion (US$1.3 billion) into the four distressed banks to stabilize them. This is in addition to the N420 billion ($2.8 billion) released to the five banks – Oceanic Bank, Intercontinental Bank, AfriBank, Finbank and Union Bank – found to be in trouble after the first round of audits. The managing directors and executive directors of Spring Bank, Equitorial Trust Bank (ETB), and Bank PHB have also been removed. Read the rest of this entry »

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Careers in Africa: International Firms to Converge in London Seeking Top African Talent

Oct 27

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Global Career CompanyAs an indication of optimism in the market, leading companies like Ecobank, Halliburton, and Total will be congregating in London to secure talented professionals for their operations across Africa at the Careers in Africa Recruitment Summit from 30 October to 1 November.

This will be the second edition of the Summit this year following a very successful event in May. Kabeho Solo, Chief Human Resources Officer at National Microfinance Bank of Tanzania says “This event continues to be a source of high caliber talent from diverse backgrounds.” Read the rest of this entry »

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MTN Uganda Secures Funding for Network Expansion

Oct 14

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MTNMTN’s Ugandan subsidiary has raised $100 million in debt to fund the expansion of its network. Isaac Nsereko, Chief Marketing Officer at MTN confirmed the development to the Reuters news agency.

Absa Capital, the investment banking arm of Absa Group was lead arranger of the syndicated loan.

“We are using it to invest in the network, different sections of the network really,” Isaac Nsereko told Reuters in a telephone interview.

Based on data from the Mobile World, the country’s five current operators and their market shares are: MTN (41%); Zain (22%); Uganda Telecom (19%); Warid Telecom (17%) and Orange (2%).

A sixth network, I-Tel launched its network last month.

Read more on Uganda

MTN Uganda | Absa Capital | Zain Uganda | Uganda Telecom | Warid Telecom Uganda | Orange Uganda

Source(s): Cellular News

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MTN-Bharti Merger Veto May Signal Bigger Zuma Role

Oct 2

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MTN Bharti AirtelSouth Africa’s decision to block a $23 billion merger between MTN Group Ltd. and India’s Bharti Airtel Ltd. may indicate President Jacob Zuma favors more state involvement in the economy to protect jobs and local industries.

Bharti and MTN abandoned talks after the deadline for an agreement expired on Sept. 30. Bharti said the structure of the deal failed to get approval from the South African government.

Zuma, who was swept into office in May with the backing of labor unions, is under mounting pressure to stem a slump in manufacturing output and the loss of tens of thousands of jobs as the economy suffers its first recession in 17 years. Until now, he has stuck to the business-friendly policies of the previous government, headed by Thabo Mbeki. Read the rest of this entry »

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Why the Nigerian Banks Stay Optimistic

Sep 28

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Naira

Analysts at Renaissance Capital call it the numbers game in Africa’s biggest market with a population of 150 million and note that Nigerians are still spending. One barometer, the sales of first-class and business-class air tickets on flights between Lagos and Europe, indicates the elite is awash with cash. More contentiously, Renaissance predicts that Nigeria’s gross domestic product will hit $308 billion in 2011; the IMF’s projection for South Africa is $262 billion.

Oil, gas, and Africa’s biggest market keep the investors interested despite the increasingly desperate politics in Abuja ahead of the 2011 elections.

After six weeks of billion dollar bailouts, high-level sackings, and the arraigning in court of five top executives, Nigeria’s financial sector is still robust enough to prompt paeans of praise from banks such as Goldman Sachs, Renaissance Capital and Standard Chartered. Not far behind in their pursuit of Nigerian business are South African banks such as Standard, Absa (now controlled by Britain’s Barclays Bank) and FirstRand – all of which are looking at buying stakes in troubled Nigerian banks, such as Intercontinental, Union, and Oceanic. Read the rest of this entry »

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Absa/Barclays Applies to Open Office in Nigeria; FirstRand and Standard Bank Keen to Enter Nigerian Banking Market

Sep 17

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AbsaAbsa’s Deputy CEO Louis von Zeuner said that Absa was applying for a representative office licence in Nigeria. Mr. Zeuner said this at an exhibition for the financial services group’s clients yesterday.

According to Absa’s Deputy CEO, international opportunities have opened up after UK-based Barclays bought a 51% stake in Absa. Barclays has been driving business to Absa and vice versa.

Competitor banking group FirstRand said on Tuesday that it was keen to enter the Nigerian banking market and that FirstRand had received conditional approval for an office in Nigeria. FirstRand’s CEO-designate Sizwe Nxasana said that the bank would wait for a second phase of consolidation among Nigerian banks before entering the market. Read the rest of this entry »

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Absa & Interntaional Finance Corporation (IFC) in $150 Million Infrastructure Funding Deal

Sep 4

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AbsaSouth African banking group Absa said on Thursday it has entered into a $150 million funding deal with the International Finance Corporation (IFC) to invest in sub-Saharan African infrastructure projects.

Absa, said it would also use the funds from the World Bank’s private sector finance arm to explore other opportunities in the region.

“Absa through Absa Capital shall focus particularly on infrastructure development in the telecommunications; oil and gas; and power and energy sectors,” Absa CEO Maria Ramos said in a press briefing. Absa Capital is Absa’s investment banking arm. Read the rest of this entry »

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International Finance Corporation (IFC) Plans More Spending on Oil in Sub-Saharan Africa

Jul 30

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Oil WellInternational Finance Corporation (IFC), the World Bank Group’s private-sector lending arm, plans to increase spending on sub-Saharan Africa’s oil and gas industry and sees “significant” opportunities in Ghana, Uganda, and Tanzania.

“Africa is a focus region for us,” Kamal Dorabawila, the IFC Head of Oil and Gas in Africa, said from Cape Town today.

The IFC has invested $400 million in Africa, about 19% of its global oil and gas total, Kamal Dorabawila said.

Ghana expects to pump 500,000 barrels of oil a day by 2014 as it seeks to boost supplies to the domestic market and become Africa’s newest crude exporter. Chairman King recently reported that Ghana will become one of the world’s top 50 oil producers.

Tullow Oil Plc. has drilled 25 wells in the Lake Albert Rift Basin in Uganda since January 2006, of which 24 found oil and gas.

IFC, Standard Chartered Bank Plc, BNP Paribas SA, Societe Generale SA, Absa Group Ltd. and Calyon are among financial institutions that helped Kosmos Energy LLC get a $750 million loan to fund Ghana’s Jubilee Field phase one development. Jubilee “is a world class oil discovery” and Ghana’s offshore is a highly prospective area, Dorabawila said.

Ghana is seeking private investors to build three or four refineries, with at least one being located in the country’s Western region, the site of the Jubilee offshore oil field. Read the rest of this entry »

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