Blog Archive

Monday, February 11, 2008

Nyaga (almost) bites the dust....

Rumors about Nyaga Stockbrokers have been making the rounds on MyStocks & Stocks Kenya for a while...

Where there is smoke there is fire...

Since Nyaga is a major player in the retail market, this adds fuel to the fire. It seems many customers want out of Nyaga with the beneficiaries being firms like Ngenye Kariuki & Co.

The NSE is bailing NSB since a thuo-like debacle can only exacerbate the "bearish" situation on the NSE. I expect there will be a run on NSB but it will take longer to sort out compared to thuo coz NSB has a much larger/wider presence in Kenya.

I am sure there is a buyer for the license e.g. CBA but just the license NOT the business. Renaissance & NIC Bank are after high-net worth clients. I think CBA is in the same league. Of course, there is Old Mutual but they face opposition from other brokers. In any case, they would not want the retail business either.

Oh, well... what do you think?


Concept said...

My initial reaction....Not another one.CMA/NSE needs to be pro-active.What is k'sh 100M compared to loss of confidence that will hit the market?

mzeiya said...

I think bailing out failed brokers is a bad precedent.

coldtusker said...

Concept: Loss of confidence is an "illusion" i.e. stay with the stron brokers. The bailout is using OUR funds (not the brokers) since we pay .01% to the fund per transaction.

Mzeiya: Agreed. Now the gov't is bailing out Invesco - a kikuyu owned insurance firm. Regardless of your (or my) politics but I think the "bad" firms should be allowed to die so the "good" ones can thrive.

What is the point of supporting underperformers?

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