16 NAIROBI STAR Tuesday, 27 January 2009

STAR BIZ
Practical tips on handling
personal finance
NEWS YOU CAN USE, EVERY DAY.

▼ FOREX Exchange Rates

CURRENCY MEAN BUY SELL
Stage set for new bank mergers
US DOLLAR 79.7167 79.6500 79.7833 BY JAMES MBUGUA Sh1 billion by 2012. The move follows the “return” on their sav-
STG POUND 108.5179 108.4191 108.6167 “All institutions whose passage of the Finance ings accounts. By custom,
KENYA’S 43-bank core capital is currently Bill 2008 and subsequent Islamic banks do not pay
EURO 103.0086 102.9071 103.1100 landscape may witness below Sh1bn should sub- signing into law by Presi- interest on savings.
SA RAND 7.8265 7.8104 7.8427 a sea-change with likely mit to the Central Bank of dent Kibaki on December Banks will from now
consolidations and merg- Kenya, a time bound core 15. make their licence renewal
KES / USHS 25.2536 25.1307 25.3765
ers after the CBK for- capital build up plan by Other regulations that applications within three
KES / TSHS 16.7003 16.6185 16.7820 mally published guidelines 1st March 2009,” CBK in are now codified into law months before the expiry
AE DIRHAM 21.4359 21.4110 21.4608 requiring all banks to be a statement posted on its include the requireament of their current licences on
capitalised to the tune of website said yesterday. by Islamic banks to pay a December 31.
JPY(100) 86.7108 86.6104 86.8112

WHY MOI NOTES

IND RUPEE 1.6215 1.6195 1.6234
CHINESE YUAN 11.5178
Source: Commercial banks
11.5051 11.5306 ▼ BRIEFS
Kenya gets US
STOCKS
BIGGEST MOVERS ARE BACK IN tourism boost
Two prominent American

CROWN BERGER
BAMBURI CEMENT
CFC STANBIC
NBK
ATHI RIVER MINING
BIGGEST LOSERS
PAN AFRICA
OLYMPIA CAPITAL
TPS EA SERENA
COOPERATIVE BANK
KENYA OIL
Bread firm profits
rise ahead of IPO
BY PETER KIRAGU
DPL Festive, the small
bread maker that is prepar-
ing to issue an IPO, has
announced that its pre-tax
profit rose to Sh62 mil-
lion in the six months to
September 2008.
This represents a 225
per cent rise compared to
Sh19 million recorded in
the previous year. This is a
major boost in its finan-
cial outlook as it awaits
approval of its impending
initial public offer.
Revenues for the six
Did you invest in the CO-OP shares?
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CIRCULATION
SHS
6.67 24.00
3.20 154.80
2.68 57.50
1.82 39.20 BY JAMES MBUGUA
1.53 92.90
THE reappearance of cur-
rency notes bearing former
President Moi’s image is
nothing to worry about, the
SHS Central Bank has assured.
The return of notes bear-
-8.62 53.00
ing the former president’s
-4.17 9.20 portrait has raised specu-
lation that CBK was being
-3.92 49.00
forced to go back to the
-3.41 8.50 archives to sustain the na-
-3.19 57.60 tion’s cash circulation.
The notes started disap-
pearing in 2003 when notes
bearing former President
Kenyatta’s portrait made a
comeback.
Responding to queries,
the director, Currency Op-
erations and Branch ad-
ministration at the Central
months reached Sh463 Bank, James Teko Lopoye-
million compared to Sh616 tum, said yesterday that
million recorded in the people should not read too
full year ending 31 March much into the reappearance
2008. of the notes as they were
DPL chief executive still legal tender.
Dipesh Shah said the results “We have never demon-
have been achieved despite etised any notes. At the time
the challenges experienced, when we introduced the
including the post-election portrait of the former presi-
upheavals and the dwin- dent (Kenyatta) we did not
dling disposable incomes demonetise these notes,”
among consumers. said Teko.
The firm’s listing at the Teko dismissed sugges-
Nairobi Stock Exchange is tions that the money may
awaiting approval by the
market regulators. It wants
to raise Sh500 million.
IMF warns Africa over tough times
POLICYMAKERS in
sub-Saharan Africa should
prepare for tough times
ahead, with no guarantee
that the resilience shown
so far to global economic
CO-OP shocks will continue, the
to 5544 International Monetary
Fund said yesterday.
Major world economies
are in recession, stung by a
global credit squeeze, and
growth is now slowing in
BACK IN ACTION: CBK forced to sustain cash circulation
have been brought back to
meet a shortfall, especially
in view of the scandal that
hit the CBK over a decision
to grant currency printer,
Thomas De la Rue, a con-
tract to print bank notes at
what was considered an ex-
orbitant rate.
“Any money that we
have issued before has not
been demonetised. They
will circulate in the system
so long as they are clean,”
said Teko. “We are not re-
leasing anything new. They
(Moi bank notes) were just
held.”
developing countries that
had at first appeared resil-
ient to the downturn.
The IMF said in a state-
ment on its website higher
food and fuel costs had put
pressure on inflation and
external balances in sub-
Saharan Africa, and the
deepening financial turmoil
that has hit world growth
could knock growth
through lower capital flows
The reserve bank is man-
dated by law to control
the circulation of money
in the country by issuing
and withdrawing currency
notes as and when it is ap-
propriate.
Sometime in 2007, the
bank decided to move into
new generation currency
notes with added security
features to thwart fraud
and counterfeiting of notes.
“We only issue new bank
notes as a top up,” he said
adding that CBK would
print new notes if it deemed
it necessary.
and export revenue.
“Economic growth in the
countries of sub-Saharan
Africa has been surpris-
ingly resilient in the face of
the latest shocks hitting the
global economy, notably
the food and fuel price
increases and financial
market turbulence,” the
IMF said in a statement.
“However, the Inter-
national Monetary Fund
personalities have endorsed
Kenya as the next major
destination for American
tourists. Former Congress-
man of the State of Georgia,
Andrew Young and Bishop
Eddie Long of the New
Birth Missionary Baptist
Church, in Atlanta, have
both pledged to visit Kenya
this year to support tour-
ism. The two met separately
with tourism Minister
Najib Balala in Washington
DC where he is leading
the tourism marketing
campaign in the US. The
American market has a
huge potential for Kenya.
Shilling stable
versus the dollar
THE Kenya shilling was
unchanged against the
dollar on Monday as
banks assessed the market
after highly erratic trade
in the previous session
following the appoint-
ment of a new finance
minister. Banks traded the
shilling at 79.75/85 per
dollar unchanged from
Friday’s close. The unit
traded in a 79.65-80.00
band. Last Friday, the
shilling saw volatile trade
as some traders panicked
after the naming of Uhuru
as new finance minister.
cautions that there is no
guarantee that this resil-
ience can be maintained
and that this will require a
determined response from
the economic policymak-
ers, governments as well as
central banks.”
IMF Africa Director An-
toinette Monsio Sayeh said
policymakers should try
maintain economic stability
while protecting the poor.