Dialectic Africa Analyst

Dear Africa Interested Professionals:                                                            I have put together a bunch of random thoughts to close out the first quarter of 2017.  Will be back to the rest of the continent as from Q2 2017 and put Nigeria to bed for awhile.   Stanbic IBTC Accounting Scandal: Do you know that everyone directly linked to the falsification of results is now out of the Stanbic IBTC picture directly?   1. Atedo Peterside; Resigned as Chairman of the board of Stanbic IBTC. 2. Sola david-Borha: Resigned as CEO of Stanbic IBTC Holdings.  Now works for Standard Bank  Group out of Johannesburg. 3. Arthur Oginga: Resigned as CFO and has left the Standard Bank group entirely.  He now works for a bank in Botswana.   4. Jim Obazee; The Executive Secretary of...

Dear Africa Interested Professionals:                                                            Zenith Bank on February 27, 2017, released its fiscal year 2016 result; Kenya Commercial Bank did the same on March 9, 2017.  Zenith Bank offered its shareholders a final and second dividend for the 2016 fiscal year of N1.77 per share.  This equates to a final  dividend yield of approximately 12% which is one of the best dividend yields for a bank in Nigeria's stock market history in relation to its current price.  The market did not budge as the stock was marked down on March 13, 2017, at pretty much the same price it was when the result and dividend declaration was announced on February 27, 2017.  What could have caused this?  The chatter among investors is the announcement of of hybrid capital raising in exc...

Dear Readers,                        This morning Access Bank was down in excess of 5% during trading hours.  During the last two hours of the trading day, there was a concerted effort to mop up the supply side to stop the bleeding on the downside.  The stock succeeded in closing the day just down 0.46% .  Maybe, another 30 minutes of trading and a deep red price movement would have a turned into a shallow green price movement.   Dangote Cement also rose with minimal shares traded <55,000 and as expected boosted the overall market as it single-handedly makes up one-third of the market capitalization of the Nigerian Stock Exchange.  There are vested interests here of course and plenty of exposure...  If Dangote Cement goes down (stock price wise), the Nigeria ASI Index goes with it and many emerging market portfolios will be hit. Stay tuned.  We are in interesting times. Companies tha...

Dear Readers;                        I will make this quick.  Companies must present a true state of affairs of their businesses.  While I cannot force them to do so, I will call them out.  Luckily, investors are actually getting a bit more cautious in their usual exuberant reaction to results that appear impressive on first take.   Dangote Cement: Dangote's Cement is not selling.  This has been a perennial issue.  The company is producing but, is selling way below its production.   The company is now competing on the level of Zenith Bank for interest income witha figure of N43.82B .   Finance income earned in 2016 by a cement company is approximately 90% of the interest earned on bonds by Zenith Bank for the whole of 2016 - $48.73B.  This is ridiculously deceitful.  This line item was pretty much used to negate finance expense of N45.4B.   Operating Profit for ...

Dear Africa interested professionals:                                                      Find below the verbatim text from the SEC about the Brokerage Scandal in Nigeria.  This is classic example of the grandiose speeches  I mentioned in my last article that are more focused on self than transparency.  The SEC's response is largely defense and pacifying rather than providing clarity and answering questions.   Why did the media have to break a story more than four months after SEC knew about it?   Now, the SEC wants to respond and feel it is being proactive and transparent.  This issue will be buried before you can dig six feet.  It is Nigeria; nothing of this nature is new. People are talking as I write and the hook is gradually being removed from the mouth of the fish.  Victor Ogiemwonyi will not be sentence...

Dear Africa interested professionals:                                                           I have incessantly spoken out about no proper system of checks and balances within some African Financial Markets.  Individuals continue playing musical chairs with influential positions to ensure they continue to have control over the financial marketplace and preserve their business deals while expanding their business empire.   Remember in 2014, when Access Bank (against extant rules in place) tried to freeze its share price for four months while it embarks on a rights issue to "preserve shareholder value?"  The freeze was on for a week until Arunma Oteh (SEC DG) at the time intervened and forced the freeze to be reversed.  Diamond Bank had completed its rights issue a few months earlier without seeking preferential treatme...

Dear Professionals:                                A little over a year and a half ago, I wrote two articles in two days about my concerns with companies audited by Deloitte based on my numerous experiences as an independent investment analyst. I will post both articles below.  In response to this article, some partner from Deloitte South Africa started chasing me around the internet with threats; he was obviously not thrilled with my truth telling which he deemed misleading lies. I always tell you readers, "posterity is never prejudiced."  Just as light and darkness will always reveal themselves, so also will the truth no matter how obfuscated it may initially appear.   Over the past month, Deloitte has been sanctioned by regulatory bodies in two different countries over poor audit oversight of its clients.   1. Deloitte has been hit with a record four million pounds fine b...