Connect with us

Hi, what are you looking for?

Capital Business
Capital Business

Kenya

Kenya not ready for EFT in IPO refunds

NAIROBI, June 25 – A leading investments banker says the country is not yet ready for Electronic Fund Transfers in transactions relating to Capital Markets.

Faida Investment Bank Managing Director Bob Karina said Wednesday that though EFTs could provide a solution to the slow IPO refund processes they would not be an immediate solution, noting that there are a number of impediments including a huge un-banked population, lack of trust, issues of literacy and a highly un-computerized society.

"Even for those who have bank accounts not many would like to disclose their bank details because they feel if they disclose someone might get into their account," said Karina.

He proposed that investors be given a choice in application documents to indicate how they would prefer to have their IPO refunds made to them.

Karina points out that depositors may want to re-invest their refunds without having to first cash their cheques, which makes the current system cumbersome.

Meanwhile, Karina who is a Lead Investment broker for the Kenya Commercial bank rights issue is optimistic of the full uptake of the 221.7 million new shares on offer.

Karina said there has been a huge demand for the rights since they begun trading at the stock market on Monday.

He is calling on shareholders who may not be able to participate in the rights issue to sell their rights in the market at the current going price of between sh5 and 7.

Karina assured shareholders that Provisional allotment papers required for application of the rights, have been dispatched to respective postal addresses.

Advertisement. Scroll to continue reading.

The document will also be used for the application of irrevocable bank guarantees for investors interested in the extra acquisition.

"All you need is for the bank to confirm that you have sufficient funds in your account to pay for any extra shares you may require," Karina explained, emphasising that these shares will not have to be paid for immediately but until allocated.

Previously only Qualified Institutional Investors (QII) were allowed the option but in this particular rights issue its open to all kinds of investors.

Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...

Headlines

NAIROBI, Kenya, Mar 16 – The World Bank has given the Kenyan government USD 60 Million (Sh6.1 billion) to help combat the deadly coronavirus pandemic...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...