Wazua
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Equity Group FY 2015 profit before tax up 7%
Rank: Veteran Joined: 8/10/2014 Posts: 992 Location: Kenya
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murchr wrote:VituVingiSana wrote:mulla wrote:Fetero wrote:James Mwangi is 1st pouring praises to the ONLY BEST asset owned by equity that never gets an entry in balance sheet. #His Employees!!! Most of his employees don't share the same sentiments...at least the ones I have interacted with. Still KCB rules with PBT up 12% 1. Mwangi is full of praise for those employees whose skills are necessary in this day & age. Tellers are a dime a dozen and being phased out by Mobile Banking, agents and ATMs. 2. Pay for performance. Those who complain should quit. Mwangi isn't forcing them to remain at Equity. 3. His top management is accomplished. Look at how Equitel has taken on Safaricom despite the roadblocks from Safaricom's lobbying and lawsuits.James Mwangi is a legend. Am still trying to locate the impact of Equitel in FY's results Lemme interject: Interest income KCB - 39.2bn +3.3bn Equity - 34.1bn +4.9bn Non interest income KCB - 19.78bn +0.55bn Equity - 21.9bn +3.4bn Total income KCB - 59.02bn +3.84bn Equity - 56.1bn +8.bn Costs are equal at 32bn KCB had a tax credit this year, Equity last year had a capital gain from sale of HF shares which was a one off. Equity had a significant one off IT cost this year. If you want higher numbers go for KCB, if you want higher diversified growth go for Equity.I think growing non-interest income is much important than the volatile interest income One more thing, Equitel contributes in interest income...an average of 1.5bn loans issued every month. Average interest rate is 5% so almost 1bn in interest income in 12 months assuming flat growth
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Rank: New-farer Joined: 6/24/2011 Posts: 49
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VituVingiSana wrote:mulla wrote:Fetero wrote:James Mwangi is 1st pouring praises to the ONLY BEST asset owned by equity that never gets an entry in balance sheet. #His Employees!!! Most of his employees don't share the same sentiments...at least the ones I have interacted with. Still KCB rules with PBT up 12% 1. Mwangi is full of praise for those employees whose skills are necessary in this day & age. Tellers are a dime a dozen and being phased out by Mobile Banking, agents and ATMs. 2. Pay for performance. Those who complain should quit. Mwangi isn't forcing them to remain at Equity. 3. His top management is accomplished. Look at how Equitel has taken on Safaricom despite the roadblocks from Safaricom's lobbying and lawsuits. James Mwangi is a legend. Word on the street is that the employees have been 'looked at' this year. Proverbs 4:23
[23]Keep thy heart with all diligence; for out of it are the issues of life.
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Rank: Chief Joined: 1/3/2007 Posts: 18,342 Location: Nairobi
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To add to @watesh - Equitel has REDUCED the cost of transactions by reducing the need for branches [660 staff have left], ATMs and agents. In a (past) presentation, JM said the cost increases from mobile/internet to agents to ATMs to branches. Branches will become Sales Points not 'transaction' points. Equitel is going to add services to the menu. Plus expansion within new markets e.g. DRC will be driven by mobile banking. He said Equitel transactions were up 1,000% and can only grow in number & value thus reducing the need for (expensive fixed-cost) branches. If his presentation is online, watch it. JM is a man on a mission! Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 2/26/2012 Posts: 15,980
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VituVingiSana wrote:To add to @watesh - Equitel has REDUCED the cost of transactions by reducing the need for branches [660 staff have left], ATMs and agents.
In a (past) presentation, JM said the cost increases from mobile/internet to agents to ATMs to branches.
Branches will become Sales Points not 'transaction' points.
Equitel is going to add services to the menu. Plus expansion within new markets e.g. DRC will be driven by mobile banking. He said Equitel transactions were up 1,000% and can only grow in number & value thus reducing the need for (expensive fixed-cost) branches.
If his presentation is online, watch it. JM is a man on a mission! VVS thats the future of banking, more technology less paper, brick and mortar. That said, KCB is reaping the same fruits except for transaction charges that the user pays to Safaricom, for Equitel...these charges are subsidized or non-existent right? "There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
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Rank: Chief Joined: 1/3/2007 Posts: 18,342 Location: Nairobi
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murchr wrote:VituVingiSana wrote:To add to @watesh - Equitel has REDUCED the cost of transactions by reducing the need for branches [660 staff have left], ATMs and agents.
In a (past) presentation, JM said the cost increases from mobile/internet to agents to ATMs to branches.
Branches will become Sales Points not 'transaction' points.
Equitel is going to add services to the menu. Plus expansion within new markets e.g. DRC will be driven by mobile banking. He said Equitel transactions were up 1,000% and can only grow in number & value thus reducing the need for (expensive fixed-cost) branches.
If his presentation is online, watch it. JM is a man on a mission! VVS thats the future of banking, more technology less paper, brick and mortar. That said, KCB is reaping the same fruits except for transaction charges that the user pays to Safaricom, for Equitel...these charges are subsidized or non-existent right? 2-3 years ago, Mwangi made a presentation where he lambasted Safaricom for charging an arm & a leg for USSD. Some @Wazuan argued with me that a transaction cannot cost 100/- [I did a series a transactions & was charged about 100/-] and I have stopped arguing with folks who insist they are right when I know what I paid. Anyway, since then Equity went with Airtel and pays Airtel "per use" at a much lower rate. So yes, it seems Equity does subsidize Equitel but that's not a bad thing as it lowers costs of transactions for both customers [loyalty] and Equity [which can push volumes & new business]. The bigger picture is using Equitel to expand into EAC. Compare the profitability of Equity's subsidiaries vs KCB. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 7/21/2010 Posts: 6,194 Location: nairobi
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One day later the results are sinking and the share responds well "Don't let the fear of losing be greater than the excitement of winning."
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Rank: Elder Joined: 2/26/2012 Posts: 15,980
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VituVingiSana wrote:murchr wrote:VituVingiSana wrote:To add to @watesh - Equitel has REDUCED the cost of transactions by reducing the need for branches [660 staff have left], ATMs and agents.
In a (past) presentation, JM said the cost increases from mobile/internet to agents to ATMs to branches.
Branches will become Sales Points not 'transaction' points.
Equitel is going to add services to the menu. Plus expansion within new markets e.g. DRC will be driven by mobile banking. He said Equitel transactions were up 1,000% and can only grow in number & value thus reducing the need for (expensive fixed-cost) branches.
If his presentation is online, watch it. JM is a man on a mission! VVS thats the future of banking, more technology less paper, brick and mortar. That said, KCB is reaping the same fruits except for transaction charges that the user pays to Safaricom, for Equitel...these charges are subsidized or non-existent right? 2-3 years ago, Mwangi made a presentation where he lambasted Safaricom for charging an arm & a leg for USSD. Some @Wazuan argued with me that a transaction cannot cost 100/- [I did a series a transactions & was charged about 100/-] and I have stopped arguing with folks who insist they are right when I know what I paid. Anyway, since then Equity went with Airtel and pays Airtel "per use" at a much lower rate. So yes, it seems Equity does subsidize Equitel but that's not a bad thing as it lowers costs of transactions for both customers [loyalty] and Equity [which can push volumes & new business]. The bigger picture is using Equitel to expand into EAC. Compare the profitability of Equity's subsidiaries vs KCB. He still pays Safaricom because there are die hard Mpesa users who dont want anything to do with the thin sim. Curious tho, he did not mention the success rate of loan repayment. "There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
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Rank: Elder Joined: 7/11/2010 Posts: 5,040
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Im lifting my buy price maximum of equity to 35.00 from 33.00. They are paying a higher dividend (total sum) than KCB yet their profits are less by 2B. KCB dividend growth has stagnated allowing equity to catch up. The numbers don't lie. NO wonder the market prices them at the same per share value. KCB Thanks to the scrip dividend share, will see its PE diluted if even slighlty. I long for the day the outstanding shares for the 2 will be the same to allow head to head competition by the market. You just gotta love equity bank and the owner/ major shareholder running the show. I notice Equity does not appear in the highest paid CEO's list despite high profits and very high growth over the years. That is very shareholder friendly. Worryingly HFCK appears and so does britam. These could be non useful observations, however, they are facts that need to be considered when making investments. HFCK ceo earns the same as KCB CEO 4.9m per month. HFCK PAT= 1B KCB PAT=20B Note that Britams gets earnings from HFCK in form of dividends, which inturn in addition to their other sources allows them to pay themselves highly. http://www.businessdaily...2/-/qqxwvhz/-/index.htmlThe investor's chief problem - and even his worst enemy - is likely to be himself
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Rank: Chief Joined: 1/3/2007 Posts: 18,342 Location: Nairobi
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murchr wrote:VituVingiSana wrote:murchr wrote:VituVingiSana wrote:To add to @watesh - Equitel has REDUCED the cost of transactions by reducing the need for branches [660 staff have left], ATMs and agents.
In a (past) presentation, JM said the cost increases from mobile/internet to agents to ATMs to branches.
Branches will become Sales Points not 'transaction' points.
Equitel is going to add services to the menu. Plus expansion within new markets e.g. DRC will be driven by mobile banking. He said Equitel transactions were up 1,000% and can only grow in number & value thus reducing the need for (expensive fixed-cost) branches.
If his presentation is online, watch it. JM is a man on a mission! VVS thats the future of banking, more technology less paper, brick and mortar. That said, KCB is reaping the same fruits except for transaction charges that the user pays to Safaricom, for Equitel...these charges are subsidized or non-existent right? 2-3 years ago, Mwangi made a presentation where he lambasted Safaricom for charging an arm & a leg for USSD. Some @Wazuan argued with me that a transaction cannot cost 100/- [I did a series a transactions & was charged about 100/-] and I have stopped arguing with folks who insist they are right when I know what I paid. Anyway, since then Equity went with Airtel and pays Airtel "per use" at a much lower rate. So yes, it seems Equity does subsidize Equitel but that's not a bad thing as it lowers costs of transactions for both customers [loyalty] and Equity [which can push volumes & new business]. The bigger picture is using Equitel to expand into EAC. Compare the profitability of Equity's subsidiaries vs KCB. He still pays Safaricom because there are die hard Mpesa users who dont want anything to do with the thin sim. Curious tho, he did not mention the success rate of loan repayment. Those who use M-Pesa are charged, as I understand it, but its free for Equitel users. NPLs at less than 4% for 2015 and expected to be less than 3% in 2016 is what he said for 2016. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Chief Joined: 1/3/2007 Posts: 18,342 Location: Nairobi
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How much does it cost in executive [all of them combined] pay to earn 1B [HFCK]? How much does it cost in executive [all of them combined] pay to earn 20B [KCB]? Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 7/11/2010 Posts: 5,040
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VituVingiSana wrote:How much does it cost in executive [all of them combined] pay to earn 1B [HFCK]? directors emoluments 19.6 M
How much does it cost in executive [all of them combined] pay to earn 20B [KCB]?
directors emoluments 262 M
How much does it cost in executive [all of them combined] pay to earn 17B [EQUITY]?
Directors emoluments 58.7 M
For HFCK not bad. But the difference between KCB and Equity is significant. The investor's chief problem - and even his worst enemy - is likely to be himself
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Rank: Chief Joined: 1/3/2007 Posts: 18,342 Location: Nairobi
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Aguytrying wrote:VituVingiSana wrote:How much does it cost in executive [all of them combined] pay to earn 1B [HFCK]? directors emoluments 19.6 M
How much does it cost in executive [all of them combined] pay to earn 20B [KCB]?
directors emoluments 262 M
How much does it cost in executive [all of them combined] pay to earn 17B [EQUITY]?
Directors emoluments 58.7 M
For HFCK not bad. But the difference between KCB and Equity is significant. That's the point I wanted to make. The pay/compensation for HFCK executives (per Billion of PAT) may not be as high as it seems at first glance vs KCB but there are numbers we might not have available to us. And at Equity the value seems much higher i.e. the cost per Billion is lower. That said, I think the TOTAL pay/compensation for execs is much higher than stated above. I know Equity has a full C-Suite who aren't on the board [Mwangi + Wamae] but "directors" [high level execs] eg Staley, Hukai, Singh, Nora, Shah, etc. [Nyakera left to become a PS]. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Veteran Joined: 12/11/2006 Posts: 930
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Book Closure 18-Mar-2016. Payment 29-Apr-2016 “Invest in yourself. Your career is the engine of your wealth.”
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Rank: Elder Joined: 7/22/2009 Posts: 7,833
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Equitel in Numbers. Good stuff!Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Veteran Joined: 11/15/2013 Posts: 1,977 Location: Here
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Yesterday i went to an equity branch to transact over the counter. The queue was long. One of the managers came and to my satisfaction he really educated/lectured queuing customers. There were only 2 tellers and he promised soon it'll be 1 teller. He emphasized on them adopting technology and encouraged use of Equitel,ATM,Agents in transacting to save time and De-congest banking halls. He was mad at the youths who say are digital yet queuing.Further he justified the three to be cost efficient. He asked one customer where he had come from,the manager then calculated for him fare paid to and fro and the time wasted to come and deposit 2k only yet the same would have been done at the nearest agent. Civil education is important. Equity employees you better begin thinking of becoming an agent! Everybody STEALS, a THIEF is one who's CAUGHT stealing something of LITTLE VALUE. !!!
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Equity Group FY 2015 profit before tax up 7%
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