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Pretty concerned about the rate at which the NonPerfoming loans are escalating...
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redi
#1 Posted : Friday, May 10, 2013 3:36:59 PM
Rank: Member

Joined: 1/24/2008
Posts: 46
Location: Embu
- Eqty- up by almost 4 Billion
-KCB- up by 2B
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  | | Edit by moderator: Tuesday, May 14, 2013 1:17 AM | Reason: spelling in title
Cde Monomotapa
#2 Posted : Saturday, May 11, 2013 12:48:17 AM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
redi wrote:
- Eqty- up by almost 4 Billion
-KCB- up by 2B
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hisah
#3 Posted : Sunday, May 12, 2013 9:36:39 PM
Rank: Chief

Joined: 8/4/2010
Posts: 8,977
It is also affecting UG banks as they too see a spike in NPL.

Ugandan banks suffer effects of bad loans - http://www.theeastafrica...-/12ldogjz/-/index.html

Quote:
Ugandan banks are facing uncertainty this year as operational costs rise amid a backlash of surging bad loans.

Whereas the banks posted a rise in profits in 2012 amid tough economic conditions, massive growth in costs incurred on bad loans and weaker performance in new branches threatened to ruin the party, analysts said.

A mixed short term outlook has created uncertainty over this year’s forecast with analysts projecting a rise in bad loans.
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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mwekez@ji
#4 Posted : Sunday, May 12, 2013 11:40:41 PM
Rank: Chief

Joined: 5/31/2011
Posts: 5,121
The NPL escalation rate is indeed worrisome. However if the escalation rate is contained and recoveries made, all will be well coz the Gross NPL/Loan ratio are currently at tolerable level {Q1 2013, Equity, 5.3%;KCB, 7.61%}
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Cde Monomotapa
#5 Posted : Monday, May 13, 2013 1:59:50 AM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
hisah wrote:
It is also affecting UG banks as they too see a spike in NPL.

Ugandan banks suffer effects of bad loans - http://www.theeastafrica...-/12ldogjz/-/index.html

Quote:
Ugandan banks are facing uncertainty this year as operational costs rise amid a backlash of surging bad loans.

Whereas the banks posted a rise in profits in 2012 amid tough economic conditions, massive growth in costs incurred on bad loans and weaker performance in new branches threatened to ruin the party, analysts said.

A mixed short term outlook has created uncertainty over this year’s forecast with analysts projecting a rise in bad loans.

SBU's 2012 provisions were super sized. Lucky the USE's has limited action. However, the div is quite generous.
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2012
#6 Posted : Monday, May 13, 2013 10:37:24 AM
Rank: Elder

Joined: 12/9/2009
Posts: 6,592
Location: Nairobi
redi wrote:
- Eqty- up by almost 4 Billion
-KCB- up by 2B


Why are you surprised?
How many businesses are making 25% profit other than banks? Charging loans at 25% is begging for default.

BBI will solve it :)
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mwekez@ji
#7 Posted : Monday, May 13, 2013 10:55:50 PM
Rank: Chief

Joined: 5/31/2011
Posts: 5,121
CBK, in 2012 Bank supervision report has given the following rating guideline on NPL ratio (asset quality)

Strong; 0-5%
Satisfactory; 5.1%-10.0%
Fair; 10.1%-15.0%
Marginal; 15.1%-20.0%
Unsatisfactory; Over 20%

At least for now our banks asset quality are strong to satisfactory.
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mwekez@ji
#8 Posted : Monday, May 13, 2013 10:59:55 PM
Rank: Chief

Joined: 5/31/2011
Posts: 5,121
2012 Bank Supervision Report from CBK >>> http://centralbank.go.ke/images...%20Reports/bsd2012-r.pdf
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mwekez@ji
#9 Posted : Monday, May 13, 2013 11:19:22 PM
Rank: Chief

Joined: 5/31/2011
Posts: 5,121
Quote:
High interest rates and economic shocks linked to the March 4 General Election have rendered thousands of borrowers unable to service bank debts, pushing the volume of bad loans in Kenya to a five-year high (Kshs 70B as at March).

http://www.businessdailyafrica..../-/130l102z/-/index.html


The chap however failed to point that loans are at all time high levels and therefore Gross NPL/Loans ratio is significantly lower than it was the five years ago
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VituVingiSana
#10 Posted : Tuesday, May 14, 2013 5:17:05 AM
Rank: Chief

Joined: 1/3/2007
Posts: 18,361
Location: Nairobi
mwekez@ji wrote:
2012 Bank Supervision Report from CBK >>> http://centralbank.go.ke/images...%20Reports/bsd2012-r.pdf
If CBK's criteria [& audit process] captures accurate data. Many banks [including European & US banks] were 'healthy' until they needed to be bailed out.

As Warren Buffett aptly put it:

When the tide goes out, is when we find out who has been swimming naked.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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  | | Edit by user: Tuesday, May 14, 2013 11:59 AM | Reason: Not specified
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