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Daily Nation : February 13th 2014
38 | BUSINESS Equity installs an enhanced banking system BY NATION REPORTER Equity Bank has upgraded its core banking system in a move that will enable it handle up to 150 million accounts and a million transactions per second. The system has been enhanced from Finacle 8 to Finacle 10, which, it said, will allow over 8.7 million Equity Bank customers to transact seamlessly across Kenya, Uganda, Rwanda, Tanzania and South Sudan. “The system is multi-currency and multi-country; it is thus going to open up trade in the region,” Equity chief executive James Mwangi said yesterday. Equity Bank’s operations will now run on a single instance of Finacle, which has been deployed centrally. This will enable the financial institution save on infrastructure and maintenance costs. Roll out offerings The replaced core banking system was built in 2005 with the capacity to process 300,000 transactions per minute while holding 35 million customers. Mr Mwangi said Finacle will help the bank roll out offerings faster, explore new lines of business and deliver a superior banking experience to its customers. The bank’s chief operating officer, Mr Julius Kipn’getich, said that the new system provides a unified view of customers, allowing the bank to offer personalised products at competitive rates. The upgrade that has taken 12 months since last year was blamed for a one-week slowdown of automated teller machines (ATMs), which affected millions of customers last July. BRIEFLY FARMING Sh7 billion to boost agriculture in Kenya The Government of Brazil has agreed to give Kenya Sh7 billion to be used in purchasing of farm inputs and other farm machineries across the country. Cabinet Secretary for Agriculture, Livestock and Fisheries, Mr Felix Koskei, said the two governments will be signing the deal next month while the equipment is expected in the country within six months. Speaking in Nairobi during the launch of code of conduct and ethics for the Kenya Society of Agricultural Professionals, Mr Koskei said the government was also in talks with the Government of India to support the agriculture sector. “We want to have best agricultural practices in the country that is why we are seeking these support from our development partners,” said the Cabinet Secretary. He said there is enough fertiliser in the country and asked farmers to prepare early. ECONOMY | Team in place to address cost of borrowing Uhuru asks banks to cut interest charges President promises to deal with issues that are blamed for high levies on credit in the country BY CHARLES WOKABI email@example.com P resident Kenyatta yesterday reiterated his call to commercial banks to lower lending rates promising the removal of administrative bottlenecks that have contributed to the high cost of credit. Speaking when he met senior officials of the Standard Chartered Bank Group, led by the bank’s global chairman, Sir John Peace, the President urged financial institutions to unlock economic growth by lowering interest rates on loans. Work in partnership “Banks and other financial institu- tions need to work in partnership with the government to make credit both accessible and affordable. This will attract a bigger customer base,” Mr Kenyatta said. The government has been piling pressure on commercial banks to reduce the cost of lending in order to ease access to capital with a team already in place to investigate the COST OF BORROWING What the president has been asking for Loans: President Kenyatta and his deputy William Ruto raised concerns on the high cost of credit last year and asked the CBK and the Treasury to investigate Measures: A team has already been formed to investigate the cause of Kenya’s wide interest rate spreads — the difference between interest earned on deposits and interest charged on loans. PHOTO | PSCU President Kenyatta with the Group Chairman of Standard Chartered Bank, Sir John Peace, at State House, Nairobi yesterday. high interest rates. Last month, the National Treasury Cabinet Secretary Henry Rotich said the team draws membership from his ministry, the Central Bank, the private sector and the Kenya Bankers Association. Sir Peace assured the President of his bank’s commitment to working with the government to make credit affordable, agreeing that the move is beneficial to both the financial institutions and customers. “We will invest much more here because we share the government’s commitment to making Kenya a regional financial hub and appreciate what has been done to improve the investment environment,” Sir Peace said. The Standard Bank chairman was accompanied by the bank’s Africa chief executive officer Diana Layfield, the chairman of StanChart Kenya, Ms Anne Mutahi and new Kenyan CEO Laming Manjang. Outgoing StanChart Kenya CEO Richard Etemesi was also present. DAILY NATION Thursday February 13, 2014 RICE WOES FOR THAILAND Presidents faces lash-back for policy that took her to power Page 41 CMC suitor’s terms return to haunt it BY NATION REPORTER Al-Futtaim is struggling to meet the terms it set in December last year in order to acquire CMC Holdings. The Dubai-based conglomerate has now been forced to waive a provision that required it to attain at least 75 per cent of CMC shareholding stake before buying the local vehicle dealer. “We hereby give notice that Al- Futtaim has determined as at 11th February 2014 to waive this condition set out in Part III, paragraph 3 (b) of the Offer Document,” a statement by the firm to CMC shareholders said on Tuesday. Granted second extension Also, the giant group has granted extension of submission – for the second time – of the shares by CMC’s minority owners in a bid to achieve 75 per cent complete takeover. According to market analysts, shareholders may have failed to appreciate the value offered by AlFuttaim for each stake. “The assumption was that by the set date, almost all CMC owners would have submitted their shares,” an investment analyst with Mavuno Capital, Mr Robert Bunyi, said. CMC was suspended from the Nairobi Securities Exchange in 2011 after a series of boardroom wrangles at a time when its shares were trading Sh13.50. Delist the shares Last September, Al-Futtaim an- nounced its intention of acquiring the car dealer and valued it at Sh7.5 billion (translated to Sh13 for each share). It has been Al-Futtaim’s intention to delist the shares of CMC Holdings in order to lay a long-term growth strategy for the firm. “We want to run it privately away from short-term demands by shareholders. We do not want to be accountable for the company’s results on an annual basis because ours is long term,” its general manager in charge of investments and acquisitions, Mr Yasser Alvi, said at a previous media briefing. In the event the 75 per cent thresh- old is not achieved by the closing date of the offer, February 18, Al-Futtaim will count on CMC to delist during its Extra-Ordinary General Meeting (EGM). Talks on production dates for Turkana oil start BY NATION REPORTER Tullow Oil has confirmed that it has started discussions with the Kenyan Government on the development plans to start production of oil in Turkana. As part of the plans, Tullow will drill over 20 wells this year. Last week, the government said it will be calling for bids for develop- ers to design and construct crude oil pipeline connecting Turkana oil fields to Lamu Port with a completion date of 2016. “Tullow considers that its acreage in Northern Kenya has the potential to be a significant new oil province,” company chief executive Aidan Heavey told reporters at yesterday’s briefing in London. “We are starting discussions with the government now on the development plans,” he said. Last week, Cabinet Secretary Davis Chirchir said the country’s oil resources have attained commercial thresholds and time is ripe for the country to start preparing for “commercial infrastructure of production wells ahead of possible production in the next three years.” “We will soon go out inviting firms to express their interest in the project. We are looking at prospective investors to give Engineering, Procurement and Construction (EPC) models and their financing arrangements,” he said. Drilling is ongoing at two wells, Emong 1 and Twiga South. The former is next to the Ngamia-1 where the first discovery was announced nearly two years ago.
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