wazua Tue, Mar 31, 2026
Welcome Guest Search | Active Topics | Log In

4 Pages«<234
NIC Bank 2012 fy results
Options
Previous Topic · Next Topic
mwekez@ji
#31 Posted : Thursday, February 21, 2013 2:10:01 PM
Rank: Chief

Joined: 5/31/2011
Posts: 5,121
the deal wrote:
mwekez@ji wrote:
the deal wrote:
Another rights issue coming


Not soon. If you think contrary, substantiate

New CBK prudetial guidelines effective 1 January 2013.

Core capital/RWA--->10.5% vs NIC Bank's 15.6%

Total capital/RWA--->14.5% vs NIC Banks 16.4%

Very little head room to expand balance sheet.


its,

Core capital/RWA---> 8% plus 2.5% Capital Conservation Buffer

Total capital/RWA---> 12% plus 2.5% Capital Conservation Buffer

Banks have been given 24 months to meet the 2.5% Capital Conservation Buffer (either via retained earnings or other capital raising method).

What is more, the NIC's core capital/RWA ratio already has enough headroom. Total capital/RWA has some room and can be improved further via Tier I or via Tier II capital (e.g debt)
.
Back to top
  | | Edit by user: Thursday, February 21, 2013 2:53 PM | Reason: Not specified
VituVingiSana
#32 Posted : Thursday, February 21, 2013 3:17:52 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,361
Location: Nairobi
mwekez@ji wrote:
the deal wrote:
mwekez@ji wrote:
the deal wrote:
Another rights issue coming


Not soon. If you think contrary, substantiate

New CBK prudetial guidelines effective 1 January 2013.

Core capital/RWA--->10.5% vs NIC Bank's 15.6%

Total capital/RWA--->14.5% vs NIC Banks 16.4%

Very little head room to expand balance sheet.


its,

Core capital/RWA---> 8% plus 2.5% Capital Conservation Buffer

Total capital/RWA---> 12% plus 2.5% Capital Conservation Buffer

Banks have been given 24 months to meet the 2.5% Capital Conservation Buffer (either via retained earnings or other capital raising method).

What is more, the NIC's core capital/RWA ratio already has enough headroom. Total capital/RWA has some room and can be improved further via Tier I or via Tier II capital (e.g debt)
.
Which means retained profits will add to the Core Capital over the next 2 years.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
Back to top
  |
the deal
#33 Posted : Thursday, February 21, 2013 3:28:46 PM
Rank: Elder

Joined: 9/25/2009
Posts: 4,534
Location: Windhoek/Nairobbery
VituVingiSana wrote:
mwekez@ji wrote:
the deal wrote:
mwekez@ji wrote:
the deal wrote:
Another rights issue coming


Not soon. If you think contrary, substantiate

New CBK prudetial guidelines effective 1 January 2013.

Core capital/RWA--->10.5% vs NIC Bank's 15.6%

Total capital/RWA--->14.5% vs NIC Banks 16.4%

Very little head room to expand balance sheet.


its,

Core capital/RWA---> 8% plus 2.5% Capital Conservation Buffer

Total capital/RWA---> 12% plus 2.5% Capital Conservation Buffer

Banks have been given 24 months to meet the 2.5% Capital Conservation Buffer (either via retained earnings or other capital raising method).

What is more, the NIC's core capital/RWA ratio already has enough headroom. Total capital/RWA has some room and can be improved further via Tier I or via Tier II capital (e.g debt)
.
Which means retained profits will add to the Core Capital over the next 2 years.

It depends at what rate they grow their Total Risk Weighted assets (TRWA), since they don't do mortgages to have a weighting of 0.5 then TRWA could grow by double digits, overall carting a huge chunk of PAT into the retained earnings category affects the dividend payout ratio, so a rights issue is more appropriate.
Back to top
  |
mwekez@ji
#34 Posted : Thursday, February 21, 2013 3:52:47 PM
Rank: Chief

Joined: 5/31/2011
Posts: 5,121
the deal wrote:
VituVingiSana wrote:
mwekez@ji wrote:
the deal wrote:
mwekez@ji wrote:
the deal wrote:
Another rights issue coming


Not soon. If you think contrary, substantiate

New CBK prudetial guidelines effective 1 January 2013.

Core capital/RWA--->10.5% vs NIC Bank's 15.6%

Total capital/RWA--->14.5% vs NIC Banks 16.4%

Very little head room to expand balance sheet.


its,

Core capital/RWA---> 8% plus 2.5% Capital Conservation Buffer

Total capital/RWA---> 12% plus 2.5% Capital Conservation Buffer

Banks have been given 24 months to meet the 2.5% Capital Conservation Buffer (either via retained earnings or other capital raising method).

What is more, the NIC's core capital/RWA ratio already has enough headroom. Total capital/RWA has some room and can be improved further via Tier I or via Tier II capital (e.g debt)
.
Which means retained profits will add to the Core Capital over the next 2 years.

It depends at what rate they grow their Total Risk Weighted assets (TRWA), since they don't do mortgages to have a weighting of 0.5 then TRWA could grow by double digits, overall carting a huge chunk of PAT into the retained earnings category affects the dividend payout ratio, so a rights issue is more appropriate.


Investors in NIC are ok with high retention ratio. They are after value & growth in the company and consequently stock capital gains
Back to top
  |
sparkly
#35 Posted : Thursday, February 21, 2013 4:15:09 PM
Rank: Elder

Joined: 9/23/2009
Posts: 8,083
Location: Enk are Nyirobi
mibbz wrote:
BGL wrote:
sparkly wrote:
mibbz wrote:
asked a question in the hfck thread and nobody replied.what does deferred tax mean?


Two concepts: Current tax and Deferred tax.

Current tax - is the tax payable (or refund due)to KRA in that year, based on tax laws.

Tax laws determine profit differently from accounting principles.

Consider a bond held for trading at 100. Value of bond goes up to 110 and HF books a profit of 10. However, Tax of 3 (30%) is only paid if the bond is actually sold. So no current tax.

Deferred tax - tax payable or recoverable in future.

In the example above HF has an asset of 110 in balance sheet. They know if the sell it they will pay tax on the 10 profit they already booked.

So they will record the tax they are likely to pay once they sell the asset as deferred tax liability in their balance sheet.

When they actually sell the bond, they will move the tax of 3 from balance sheet to profit and loss. Thats how the P&L is affected.

Note: A simplified example.


Thanks @sparkly
So, would i be right if i say its tax payable in the future as a result of past transactions BUT which must be paid at some point. Then its a convenient way of making shareholders happy when things are tough.

Perhaps i can draw an analogy with deferral that we are accustomed to (the shuttle diplomacy watermelon was pursuing).


@sparly thanks a lot,at least i understand it now.isn't it possible to manipulate books in accounting to suit a specific need,i find this field very dynamic and the smarter accountants can hide potential bombshells in many places....


True, deferred tax is highly subjective when dealing with complex issues like business reorganisations, revaluations of investments and tax losses carried forward. I see creative accounting by KPMG (belief they are the auditors).

KBS has been active for past 2-3 years. Why recognise tne asset now, and incidentally increase the PAT. Thats why Buffet looks at the cash return.
Life is short. Live passionately.
Back to top
  |
4 Pages«<234
Forum Jump  
You cannot post new topics in this forum.
You cannot reply to topics in this forum.
You cannot delete your posts in this forum.
You cannot edit your posts in this forum.
You cannot create polls in this forum.
You cannot vote in polls in this forum.

Wazua Investor Theme
Powered by YAF | YAF © 2003-2009, Yet Another Forum.NET
Copyright © 2026 Wazua.co.ke. All Rights Reserved.