× Business BUSINESS MOTORING SHIPPING & LOGISTICS DR PESA FINANCIAL STANDARD Digital News Videos Health & Science Lifestyle Opinion Education Columnists Moi Cabinets Arts & Culture Fact Check Podcasts E-Paper Lifestyle & Entertainment Nairobian Entertainment Eve Woman Travelog TV Stations KTN Home KTN News BTV KTN Farmers TV Radio Stations Radio Maisha Spice FM Vybez Radio Enterprise VAS E-Learning Digger Classified Jobs Games Crosswords Sudoku The Standard Group Corporate Contact Us Rate Card Vacancies DCX O.M Portal Corporate Email RMS
×

Stanchart gets nod for Sh3 billion rights issue

NEWS
By JACKSON OKOTH | May 25th 2012

By JACKSON OKOTH

Standard Chartered Bank has indicated that cost of credit could remain high, at least for the next six months. This is until there is a substantial drop in cost of living, which remains high due to expensive food and fuel.

“Inflation figures are not encouraging. While we expected current rains to trigger a drop in food prices, this has not happened.

The Central Bank could therefore keep its rate at current levels for the next six to nine months,” warned Richard Etemesi, chief executive- Standard Charted Bank.

He made these remarks Thursday while addressing shareholders during the bank’s Annual General Meeting (AGM) at a Nairobi hotel.

Shareholders approved a rights issue that aims at raising Sh3.2 billion to support a growing balance sheet and anticipated business growth between this year and 2015.

“We shall use some of these funds to increase customer assets, recruit more staff, increase loans and advance portfolio and refurbish some of our branches,” said Etemesi.

The bank says uncertainty around the political process and elections will continue to act as a drag on business confidence while a forceful parliament with a populist agenda could also be detrimental to the economy.

In recent weeks, the shilling has been under pressure raising fears that the experience of last year when it hit a historic low of Sh107 to the US dollar, could recur.

“A widening current account deficit is putting pressure on the shilling. There has also been an outflow of foreign currency as investors shift from falling Treasury Bills to higher yielding instruments,” said Etemesi.

In the last few days, CBK has pumped over $100 million (Sh8.4 billion) to the local forex market in a bid to support the local unit.

There are concerns that adverse weather condition, including floods in part of the country in recent months, could affect agricultural production.

Persistence in the Euro Zone crisis, volatile international crude oil prices and a widening current account deficit together upcoming election politics expected to be keep drivers of the economic outlook this year, says the bank.

 

Share this story
Sasini half-year profit dips by 58 per cent
Sasini Ltd recorded a 58 per cent drop in net profit for the six-month period ended March 31, 2012.
Absa Bank net profit for 3 months up 24pc
The performance was mainly driven by growth in interest income, particularly in the small and medium enterprises.
.
RECOMMENDED NEWS
Feedback