A Bank gives you an umbrella when it is sunny and takes it away when it starts raining.

What am I saying? I am saying that a bank makes money when you are servicing your loans but makes more money when you default.

How does a bank do that? A bank does that by attaching and selling the security which could be your house, stock of goods or your business.

Banks are not stupid my fren.

🎲 the dice has landed. Its now official kequeer has grown voluptuous shafting appetito to the willing souls. .

Here is my take:

- GoK will convert debt to equity [think NBK, KPLC, KenGen or Uchumi] at a discount i.e. the taxpayer will end up buying worthless shares. Even if GoK gets some value, it will be at a fraction of the investment.

- Banks, like Uchumi's creditors, will get shares BUT unlike Uchumi, they may not be able to sell them out at the price they will get the shares. Once bitten, twice shy.

- The guarantee of $77mn is peanuts. Banks are owed $280mn so this is only 25% of the current debt. And the guarantee kicks in over 10 years so accounting for time value of money it might be only 5%!

This is a poor deal for the banks i.e. they may have rights/collateral they can seize and get more than 25% in TODAY's money. I also think that banks were arm-twisted into not taking action against KQ much earlier.

The Taxpayer will be screwed over 100%.

I am sure there are a few idiots [minority shareholders] who would put in fresh cash in as a Rights Issue but I don't think most would.