Dialectic Africa Analyst

Dear Africa Interested Individuals:                                                         Nigeria is the largest economy in Africa while South Africa is the most advanced economy.  Nigeria is also the most populous country in Africa.  South Africa is not even among the top five most populous countries in Africa.  So which country is really bigger than the other? MTN Group makes more money in Nigeria than from any other country it operates in including the home country of South Africa.  Over 33% of global revenues are from Nigeria only.    DSTV (part of Naspers) increases bouquet prices by double-digits every 16 months on average and continues to operate a subtle monopoly which is a huge benefit given Nigeria's population and love for football (soccer).  Football is not the most popular sport in South Africa and is not even second.  Rugby and Cricket are way ahead in terms of popularity and viewership.  Naspers is the largest company in Africa by market cap at over $66

Dear Africa Interested Individuals:                                                         I will take a look at major foreign exchange earners for select African countries and how their currencies have fared against the U.S. Dollar.   The major foreign exchange earner for Ethiopia is Coffee.  Coffee prices have dropped approximately 9% over the past six months while the Ethiopian Birr has declined approximately 3% against the dollar over the same period.   The major foreign exchange earner for Kenya is Tea (has bounced back and forth between tourism and tea over the years.)  Tea prices (based on my source) have risen by about 46% over the past six months.  The Kenyan Shilling has declined 11% against the dollar over the same period.   The major foreign exchange earner for Algeria is Crude Oil.  Crude oil prices have dropped approximately 15% so far in 2015 while the Algerian Dinar has declined 7% against the dollar over the same period.   The major foreign exchan

Dear Africa Interested Individuals:                                                         I took a look at the largest bank by assets in 15 African countries from the north to the south.  I wanted to find out if the largest banks by assets wear the same crown on an absolute (nothing pertaining to valuation) price basis on their respective stock exchanges.  Prices referenced are either August 6th or 7th, 2015.  Prices will be referenced in dollars.   PER means price-to-earnings ratio.  Conversion rates are as at August 7th, 2015.      South Africa: The largest bank in South Africa is the Standard Bank Group.  Its share price is $12.41 with a PER of 13.9X .  This is not the costliest bank stock price on the JSE.  Barclays Africa is more than 5X costlier at $63.15 .   Nigeria: The largest bank in Nigeria is Zenith Bank (it is not First Bank when compared bank to bank without the non-banking companies.)  Its share price is $0.09 with a PER of 5.4X .  This is not the costliest ban

Dear Africa Interested Individuals:                                                         I have come across more complaints about the performance and happenings at First Bank and Diamond Bank in recent days.  A cursory look at their income statement (the "optics" sheet) shows that both banks made large (double digit in billions of naira) provisions for deteriorating loans on their books over the first six months of 2015.  In addition, First Bank's MD is on his way out and the CFO of Diamond Bank is out.  It is hard for people on the outside (understandably so) not to link these changes with their deteriorating loan book.  The comments around these banks shows why Nigerian banks (and some other companies) will continue to lean towards telling too little of a BAD situation and telling too much of a GOOD situation .  Earnings will continue to be opaque in nature just as lying will continue to be the norm and acceptable.  I agree that the banking industry in Niger

Dear Africa Interested Individuals:                                                          In difficult operating environments, I like to get a feel for the banks that are prepared to deal with the difficult times ahead.  Sometimes in life, the simplest assessments tell a lot.  I have picked one for today's article.  Ten (10) Nigerian banks have so far released their H1 2015 results.  This is not about profit this time around.  I want to look at the two Double D's that Nigerian Banks are fixated on; the former perennially and the latter temporal.  Deposits and Debt (could be borrowings, securities issued or on-lending facilities.)   First Bank increased its deposit base over the first six months of 2015 by $376.5m and reduced its outstanding debt by $412.2m .  First Bank succeeded in adding what it values and reducing a burden on its books.  If the bank succeeds in reducing its net debt by another $169m, by the end of the third quarter, it would have brought its debt

Dear Africa Interested Individuals:                                                        Forte Oil released its H1 2015 earnings on July 31st, 2015.  During my days of sending sporadic emails, I wrote an article discussing my serious concerns about the published figures of Forte Oil for Q1 2015.  The CFO of the company (first time in my history by the way) actually challenged me to an open debate to prove that I am wrong in my assertions.  I smiled to myself...  I said to myself "Jude wait for the H1 2015 result and see what management will do."  It is a case of either management will become more transparent in their bid to prove Jude and whomever else shares his view wrong or they will "lock up shop" and disclose less information to prevent me from picking out the holes (if any) in their published figures.  Forte Oil apparently chose the latter and through psychology, have proven that something is amiss without me even having to write a word .  The Q1 publis

Dear Africa Interested Individuals:                                                         I reviewed seven select banks in the two foremost frontier markets in Africa: Kenya and Nigeria.  Both are the heartbeats of economic activity in their respective regions.  I had a tripartite evaluative approach.  The banks reviewed are: . SCB Kenya    Equity Group Holdings Kenya Kenya Commercial Bank Zenith Bank Nigeria UBA Bank Nigeria First Bank Holdings Nigeria GT Bank Nigeria National Bank of Malawi  Bank of Kigali, Rwanda In terms of disclosure, I wanted to know which of these banks broke down their loans into a graduated maturity system including tenors in excess of five years which I consider long-term.  Only four of the nine banks disclosed this information:  SCB Kenya, Kenya Commercial Bank, Bank of Kigali and National Bank of Malawi .     In terms of lending, I assessed the amount of net loan interest income relative to net loans these banks generated during FY