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Sunday, April 27, 2008

More stockbrokers to bite the dust?

6 brokers on the Watchlist according the Business Daily.

Bob Mathews - In trouble once. In trouble again?
Discount Securities - The owners tried to sell it at an inflated price but no-one bit at the time.
Reliable Securities - In the news before. Jos Konzolo was the former NSSF head honcho.
Crossfield - Securities - No idea.

Solid Securities - Now NIC Capital. An operational matter or a problem with the prior owners. NIC Bank has enough money to keep them in business. NIC owns 60% of SS but I expect an 'internal' Rights Issue will increase their stake.

Ngenye Kariuki & Co - A surprise on this list. It has been a 'steady' firm with a large retail base. The owner is a hands-on manager (unlike Nyaga Stockbrokers).

Does any one have more to add on these firms?

And a new broker- Chartered Capital. Info from Bankelele.

I think the value of the 'licenses' will drop from the astronomical figures bid by Old Mutual (KShs 452mn) and Renaissance Capital (KShs 256mn). Rumours have it that there are another 4 new licenses waiting to be issued.


Ssembonge said...

Even though the NSE is a small bourse, we need as many brokers as possible to ensure that the firms offer competitive services.

Later on when they fully embrace technology, they can merge or let the weak ones close shop.

As for the licences, I'm not sure why they cost that much. I think the record for a 'seat' at the NYSE is $4m (240 m Kshs).

bankelele said...

I think some brokers may be worse off after the IPO than before -because it appears that commerical banks processed the lions share of applications, while some brokers had extra costs of new staff, offices, and advertising which they never do anyway

some info, may be outdated
- Ngenye kariuki family owned & run
- Crossfield: Chairman-Nilesh J. Kotedia, J.T Swaley, Kumar Krishna (MD), Herbert Joseph Gore (GM)
- Solid Investments - Now part of NIC was 75% owned by Kithinji Kiragu
- Discount Securities: Chairman- William Murungu, Allan Simu, Executive Director- David Githaiga

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