High interest on bonds to hit bank, insurers’ earnings

Banks and insurance companies’ earnings are expected to take a hit from unrealised losses arising from the recent hike in interest rates for Treasury bills and bonds. Interest rates of the bills have shot to 20.6 per cent at the end of September up from 8.6 per cent at the close of the last reporting period ending in June. A rise in interest rates has an inverse relationship with the price of bills and bonds in the market such that losses are incurred once the yield rises because the price falls [...]

TransCentury plans cash call in six months to pay off Sh5.9bn bond

Engineering and infrastructure firm TransCentury will be going to the market to raise additional cash in the next six months. TransCentury seeks to raise the funds for its construction, energy businesses and to pay off a Sh5.9 billion convertible bond that is due in March 2016. Chief executive Gachao Kiuna had earlier said the company was looking to raise money through a rights issue in addition to borrowing [...]

Kenya to reintroduce VAT on all oil products

Fuel prices in Kenya are expected to increase sharply next year as the government plans to increase taxes on the commodity to raise an additional Ksh16 billion ($152.62 million). The government will impose 16 per cent value added tax (VAT) on oil products to shore up its domestic revenues, which have come under pressure in the wake of burgeoning spending, corruption and wastage. The tax, which is to be enforced by September next year, will make the cost of goods and services expensive, increase the cost of doing business in the country and render East Africa’s largest economy uncompetitive to investors [...]

Naivas in a head-to-head race with Nakumatt for Bungoma

Naivas Supermarket has announced plans to open a branch in Bungoma, stepping up competition for shoppers in western Kenya following rival Nakumatt’s acquisition of the town’s main retailer Yakos [...]

Jubilee Insurance partners with DR Congo insurer

Jubilee Insurance has entered the Democratic Republic of Congo where it plans to tap high demand for cover in the country. Jubilee Insurance has partnered with State-owned insurance company Sonas to offer medical and life cover products [...]

US investor to offer loans on M-Pesa, Facebook data

A US company has launched a Facebook-linked mobile phone lending service that allows users to borrow and repay small loans through M-Pesa. The firm will be offering entrepreneurs up to Sh50,000 repayable in six months. It will target small and micro enterprises that are in need of quick loans but are locked out by traditional banks which demand collateral and see them as high-risk borrowers. Borrowers need to download Branch from Google Play, log-in with their Facebook accounts and can then begin applying for small loans [...]

Nairobi seventh in global rental index

Nairobi has been placed seventh out of 18 global cities ranked in terms of the growth in rental prices over the 12 months to June this year. Nairobi is among global cities that reported sluggish growth in residential rent prices over the 12 months to June this year. Rents for prime residential properties in Nairobi’s suburbs increased by only 1.4 per cent in the year to June, says Knight Frank. The slow growth is due to prime tenants such as employees of multinationals and diplomatic missions being unable to pay higher rents [...]