Seriously, I am Just Asking...

Dear Africa interested individuals:

                                                        It is Monday, July 13th, 2015 and I have to decided to think out loud.  Ponder along with me.   I am just asking...

1. Why does Ecobank Transnational Incorporated (ETI) have a different auditor from its subsidiaries?  ETI uses PriceWaterhouse Coopers (PWC) while Ecobank Nigeria uses Deloitte and Ecobank Ghana uses KPMG. (These are the two main individual country subsidiaries of ETI.)  The auditing process for ETI and its many subsidiaries will be smoother and more integrative in nature if the same auditor is utilized.  There is a reason why the word uniformity exists.  Life is hard enough, let us try to simplify it as often as possible.  Let us zip by Africa and see what other companies in the same situation did. 

Illovo Sugar South Africa uses Deloitte and so does it subsidiary Zambia Sugar.  Qatar National Bank (QNB) (ironically a prominent shareholder in ETI) uses Ernst & Young for the global entity headquartered in Doha, Qatar and also for Qatar National Bank, Egypt.  Kindly note that Egypt requires dual auditors for banks.  PZ Cussons UK uses PWC and so does PZ Cussons Nigeria where about 30% of revenue comes from annually.  The actions of other companies is just a reference point.  I would have still stood for same auditing firm across subsidiaries even if other companies were also using separate auditors across subsidiaries in relation to the parent.  As evidenced, other companies share my position.  Why did Africa's largest bank by reach decide to be different by going the non-ideal route?  

2.  Why does no Nigerian Bank yet have an INTEGRATED annual report?  Does the apathy towards better corporate written communication emanate from fear of deeper level disclosures?  Most events like this are forced on Nigerian Banks.  I guess we have another one waiting in the wings.  Central Bank of Nigeria your number has just been called.  The same way they were mandated to put their detail annual reports on their websites by the Securities and Exchange Commission a few years ago.  Till date, some banks still flout this directive.  Unity Bank still does not have its detailed 2014 annual report on its website and we are now in the second half of 2015.  Why is the right thing so difficult for people to do in Nigeria?  When you now do the right thing, those that like doing the wrong thing will not let you be.  Waste of their time as far as I am concerned.  Darkness will always succumb to light.           

3.  Why do Nigeria and Ethiopia not yet have a strictly retail commercial bank?  The two most populous countries in Africa (Nigeria is also the seventh largest in the world) do not yet have banks strictly focused on retail customers to exploit the vast potential of their burgeoning populations.  South Africa has Capitec Bank.  Botswana, Namibia, Uganda, Kenya, Tanzania, Mozambique, Lesotho, Swaziland & Rwanda have strictly retail banks through the presence of Letshego in these countries.  All Nigerian banks appear fixated on corporates believing they are less risky to lend to and easier to work with.  How has that worked out for them thus far?  I guess the Asset Management Corporation of Nigeria (AMCON is Nigeria's bad bank)) will have a lot to say about this.  Nigerian banks keep lending to assets (developed properties with certificate of occupancy inclusive of governor's consent) and self recognition.  Africa's largest economy needs to have a strictly retail bank like yesterday.  Who will bell the cat?  

4. Why is Standard Chartered Bank (SCB) listed in Kenya, Ghana, Zambia and Botswana but not Nigeria?  Why should the citizens of these other African countries be able to share in the success of  SCB in their respective countries and Nigerians should be left out?  Maybe there is so much money to be made in Nigeria and the global office in the U.K. does not want to dilute the Nigerian 100% contribution to the bottom-line?  SCB Nigeria achieved net income of $136 million in 2014.  All of it benefiting the books of the parent.  The subsidiary of SCB in Africa's largest economy appears to be too large to share.  Meanwhile, the Nigeria arm actually needs equity capital (in my opinion.)  This  will be a great time for SCB Nigeria to sell a 20% - 25% stake and list on the Nigerian Stock Exchange and raise the needed equity injection without disturbing the parent that has a lot of bigger issues to deal with right now globally.  I am in pause mode; tell me when to press play...

5.  Why do South African companies find it difficult to succeed in the Nigerian food & restaurant market?  Africa's most advanced and largest economies cannot apparently align when it comes to matters of the stomach?  A quick rundown:

• Nando's ran away from Nigeria. Enough said.  Still holding sway in South Africa. 
• Famous Brands is struggling to grow profit at UAC Restaurants through Mr. Biggs which it owns 49% of.  Pre-tax income declined 63% and revenue declined 20% from FY 2013 - 2014.  Debonair's Pizza (owned by Famous Brands) is also losing market share and closing a few outlets here and there.   
•  Tiger Brands is still struggling to grow UAC Foods which it bought a 49% stake in almost five years ago.  While this is a better story than UAC Restaurants and Famous Brands, it is still not yet over the hump five years on.  Revenue held steady while pre-tax income declined 24% from FY 2013 - 2014.  
• Tiger Brands purchased a majority stake in Dangote Flour in October 2012.  The company has been loss-making since acquiring the company till date and the losses are mounting.  Half-year net income loss is already more than the audited loss for FY 2014 that ended in September.   

  I have finished asking and have now passed the baton to the rest of you.  I am still thinking and analyzing though; I never stop doing that. 

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