Fidelity Shield downgraded to negative outlook

Fidelity Shield Insurance’s future outlook has been downgraded from stable to negative over weak liquidity and recently “subdued” cash flow. GCR assigned the negative grade to Fidelity Shield Insurance but retained BBB+ rate on its ability to settle claims. The South African rating agency identifies the Fidelity Shield’s investment in property as a key barrier to liquidity. The insurer’s earnings are said to be mainly driven by investment income and not its core business of underwriting [...]

Insurance brokers protest excise tax as backlog piles

Insurance brokers say the 10 per cent excise tax on commissions poses a threat to the industry. The Kenya Revenue Authority (KRA) introduced the tax in 2013 but insurance brokers went to court to have the decision reversed. The tax was to apply to related service providers such as agents, loss adjustors, loss assessors and other intermediaries. The brokers said the tax would make insurance products expensive and erode any gains in penetration, now at three per cent of GDP, though far behind other markets such as South Africa with 14 per cent [...]

Pancontinental to start drilling Lamu oil block despite industry slowdown

Coast region explorer Pancontinental Oil and Gas is set to drill part of offshore Block L6, located around Lamu, shrugging off widespread slowdown of activity in the industry. Pancontinental Oil and Gas exited L10A as well as L10B earlier this year, citing escalating costs of the business. The company said it was convinced that there were oil deposits offshore, not far from the confluence of River Tana and the ocean [...]

Nairobi coffee sales take break on low supplies

The weekly coffee auction took a break last week as volumes dwindled after the main crop from eastern Kenya dried up. Nairobi Coffee Exchange (NCE) has been grappling with low quality beans in recent auctions, with the price of the commodity falling. In the latest auction price of the beverage dropped from an average Sh16,218 to trade at Sh15,198 per 50-kilogramme bag [...]

Tea prices at Mombasa auction fall as volumes rise

Tea prices at the Mombasa auction have dropped for the third time in a row as the volumes offered for sale grew by more than half a million kilogrammes at last week’s auction. A kilo of tea on average sold at Sh291 during last auction from Sh300 in the previous sale. But in comparison with the corresponding period last year, the price of the beverage has improved significantly. The same time last year, a kilogramme of made tea was selling at Sh191 compared to the current price of Sh291 [...]

KCAA rejects Fastjet bid for global licence

UK’s budget airline Fastjet has been denied a licence to operate international routes through Kenya by the aviation regulator in a move seen to protect national carrier Kenya Airways. Kenya Civil Aviation Authority, however, granted Fastjet a domestic licence allowing it to connect Nairobi, Eldoret, Wajir, Mombasa and Kisumu. Fastjet intends to operate global flights to and from Europe, the Middle East, Uganda, Zimbabwe and South Sudan, among other countries, deploying a fleet of up to 34 Airbus A319 aircraft [...]