Rank: Elder Joined: 12/4/2009 Posts: 10,785 Location: NAIROBI
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DtheK wrote:Ericsson wrote:https://www.businessdailyafrica.com/bd/corporate/companies/cic-skips-sh425m-interest-on-loan-from-co-op-bank-3786394
CIC Insurance Group last year obtained a moratorium on interest payments on a Sh3.4 billion loan owed to Co-operative Bank , saving the underwriter Sh425 million in finance costs in 2021.
The five-year loan matures in September 2024 and carries a fixed interest rate of 12.5 percent, with the principal due in a single bullet payment at the end of the period.
“During the year, the company obtained a moratorium of repayment of interest until October 2022, hence no interest repayments have been made during the year,” CIC says in its latest annual report.
The moratorium on interest payment is part of the accommodation Co-op Bank has given the insurer to give it more financial flexibility. The loan was previously secured — in addition to the land — by cash deposits and corporate guarantees but these have since been dropped.
Co-op owns a 24.8 percent stake in the insurer. These people might need a rights issue ASAP to sort this Co-OP loan, like Sanlam. Unless I misread it has increased to 4.9B, the value of the Kiambu land is 4B.In 2023 they were only able to pay 111M and collected less than 100M in land deposits. So they'd have to do something to the land that adds 900M in value and then the land would have to appreciate by 12% plus annually? The debt has increased to ksh.5.3bn as per HY results Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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