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The East African : Mar 16th 2015
52 MARCH 14-20,2015 BUSINESS, MARKETS AND FINANCIAL ANALYSIS THE MARKET WHISPERER EQUITY MARKETS (WEEKLY CHANGE IN BENCHMARK INDEX) NSE 20 Share Index Kenya 5,373.22 -2.15% (CUMULATIVE MOVEMENT) DSE All Share Index Tanzania 2,660.78 -1.50% MARCH 14-20,2015 BUSINESS, MARKETS AND FINANCIAL ANALYSIS THE MARKET WHISPERER EQUITY MARKETS (WEEKLY CHANGE IN BENCHMARK INDEX) NSE 20 Share Index Kenya 5,373.22 -2.15% (CUMULATIVE MOVEMENT) DSE All Share Index Tanzania 2,660.78 -1.50% USE USE All Share Index Uganda 2,010.00 2.71% RSE All Share Index Rwanda 137.33 0.00% JSE All Share Index South Africa 53,208.07 -0.04% NGSE All Share Index 31,049.37 Nigeria 3.56% rica is expected to intensify following the opening of a marketing office in Nairobi by Mauritius Commercial Bank (MCB). The bank expects the rep- Mau≥itius Comme≥cial Bank sets up o∞ce in Nai≥obi C ompetition for trade finance deals in East Af- resentative office, authorised by the Central Bank in November last year, to offer new leads and referrals for trade facilitation. Kenya and Mauritius have signed double taxation treaties that are expected to see increased trade between the two countries. MCB chief executive An- tony Withers said the bank was attracted to Kenya by international organisations setting up offices in Kenya. “The office will also sup- port the growing trade and investment flows between Kenya and Mauritius. The office is a listening post that will enable us to maintain a relationship with banks in Kenya and neighboring countries,” Mr Withers said. Raoul Gufflet, the bank’s head of international division, said that MCB would NedBank, a South African bank, has a representative office in Nairobi. The city will soon be competing with Johannesburg as a top financial hub. Picture: File position itself in the trade finance spectrum now controlled by Citi, KCB and Cfc Stanbic in Kenya. “We are thinking of giv- ing a much more trade-oriented focus to the Nairobi office as a landing base for the various activities that the bank will try to develop in the local market, capital The bank was attracted to Kenya by international organisations setting up offices in Kenya markets and the East African Community as a whole,” he said. Outside Mauritius, MCB Bank has a presence in Madagascar, Maldives, Mozambique, Seychelles, South Africa, France, Reunion and Mayotte. MCB boasts 200 correspondent banks in 39 countries. After South Africa and Nigeria, Kenya is the larg- est economy in sub-Saharan Africa and has good gateway connections in Africa. Kenya’s Central Bank does not allow representative offices of foreign banks to undertake banking business. As at December, 2014, MCB’s market capitalisation was at $3.8 billion on the Mauritius Stock Exchange, while its equity value was at $3.12 billion. “The entry of foreign players will promote competition and diversify the current offerings of financial services,” CBK said when it granted CMB the licence for the office. Other lenders with rep- resentative offices in Kenya are Bank of Kigali, Central Bank of India, HDFC Bank (India), Nedbank and FirstRand Bank, both of South Africa, Bank of China and Rabobank Nederland. US bank JP Morgan Chase has also indicated its intention to open an office in Nairobi, bolstering Nairobi’s ambition to compete with Johannesburg as a top financial hub in Africa. De≥ivatives coming to Kampala, Nai≥obi bou≥ses IT NOW seems trading in instruments that mitigate investment risks — known as derivatives —could become a reality by the second half of the year in Nairobi and Kampala. ALTX Uganda, the country’s first derivatives exchange, is set for launch in May, promising investors shorter settlement times and access to global markets. The Nairobi Securities Exchange plans to have a derivatives board in place by the end of June, giving impetus to the deepening of the capital markets being driven by regulators and the East Africa Stock Exchanges Association. ALTX promises a settlement time of one day compared with five days at the Uganda Securities Exchange, which plans to launch its own automated trading platform in July. Joseph Kitamirike, ALTX Uganda’s chief executive officer, said the quicker turnaround in settlement would spare investors loss of alternative trading opportunities, thereby attracting liquidity from especially large foreign investors who have been opting for more developed markets. So far, ALTX has signed up Bur- bidge Capital and Rock Financial Services as brokers. ALTX Africa Group recently sold a 25 per cent stake to GMEX Group, a British supplier of trading software solutions. With its impending automation, USE for its part hopes to reduce the settlement time from five days to three days. “It is a big challenge for anyone in the market to achieve a one-day settlement time lag because of common difficulties experienced between fund managers and custodians whose systems take longer to process transaction entries,” USE chief executive officer Paul Bwiso said. However, the ATS will be integrated with the Bloomberg and Reuters data systems to give investors real-time data that could bolster offshore participation. Published at Nation Centre, Kimathi Street, and Printed at Mombasa Road, Nairobi by Nation Media Group, Box 49010, GPO Nairobi, 00100. Registered at the GPO as a newspaper. Nairobi Office, Tel: 3288000, 211448, 337710, Fax 214531, 213936. Dar es Salaam Office. Tel: 2119657/8. Kampala Office, Tel: 232771, 232772. Fax 232781 Download free QR Readers from the web and scan this QR (Quick Response) code with your smart phone for pictures, videos and more stories Flame T≥ee G≥oup to get food b≥ands f≥om Chi≥ag FLAME TREE Group, which listed on the Nairobi Securities Exchange, three months ago, intends to acquire four food and snack brands from Chirag Kenya. The new stable — Natures Own (spices), Chigs (potato crisps), Honeycomb (biscuits) and Gonuts (nuts) — had an annual turnover of Ksh90 million ($1 million) last year. The deal is subject to ap- proval from the competition authority but this is expected to be a matter of course because the food sector is fragmented and none of the players has control of the market. Flame Tree, which is increas- ingly being seen as a diversified fast moving consumer products player, already runs a food business under the Happy’s brand. The acquisition is expected to double the company’s presence in the segment. Since the listing, the company’s shares have jumped by 6.75 per cent to Ksh8.70, about 10 US cents.
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