PROSPECTUS
This
prospectus provides detailed information about the Bank and the offer.
Potential investors in respect of the offer herein are advised to read this
document carefully and retain the copy for future references. In any case the
investor is not clear about the actions to take, they should consult their
lawyers or any person with requisite knowledge for guidance and carefully
review the risk associated with investing in the bank
CAUTION:
This
document is important and requires your careful attention.
This document is a prospectus
inviting the public to acquire the Offer Shares under the terms of application
set out herein. If you wish to apply for the Offer Shares then you must
complete the procedures for application and payment set out in this document.
A copy of this Prospectus has been
delivered to the Registrar General of Companies for registration.
For
information concerning certain risk factors which should be considered by
prospective investors, see “Risk Factors” as explained in this document.
This
Prospectus is issued in compliance with the requirements of the form set out in
the Companies Act Cap 486.
A
copy of this Prospectus has been delivered to CMA for approval. Permission has
been granted by CMA for Gin-Kelly Koffide International Bank to offer to the
public the Offer Shares. Application has been made for listing of the Bank’s
securities offered by this Prospectus to CMA.
Insert company
advisors eg
Gin Kelly Surveyors
Box 50
nairobi
Website: https://plus.google.com/+alfredkoffidegin/posts
|
International
Book building opens (International Pool)
|
17
June 2013
|
|
International
Book building closes (International Pool)
|
23
June 2013
|
|
Opening
of Offer Period (Domestic Pool)
|
30
June 2013
|
|
Close
of Offer Period (Domestic Pool)
|
29
July 2013
|
|
Announcement
of allotment results
|
12
August 2013
|
|
Last
date for payment of Shares under International Pool and QII sub-pools
|
18
August 2013
|
|
Dispatch
of CSD Statements and commencement of collection of refunds from ASAs
|
22
August 2013
|
|
Admission
to Listing, and commencement of trading of the Shares, on the Nairobi Stock
Exchange
|
29
August 2013
|
OFFER STATISTICS
|
Offer Price per Offer Share
|
Kshs
|
125.00
|
|
Par value of each Offer Share
|
Kshs
|
10.00
|
|
Authorized share capital of the Bank
|
Kshs
|
7,024,600,000
|
|
Total number of issued shares
|
500,500,000
|
|
|
Number of New Shares
|
166,837,000
|
|
|
Number of Sale Shares
|
133,467,400
|
|
|
Total number of Offer Shares (New Shares plus Sale Shares)
|
300,304,400
|
|
|
Gross proceeds of the Offer
|
Kshs
|
37,538,050,000
|
|
Net profits for the twelve (12) month period ended
31.12.2012)
|
Kshs
|
6,179(Millions)
|
|
EPS for the twelve (12) month period ended 31.12.2012
(based on500,500,000 shares following a Share split)
|
Kshs/share
|
12.34
|
|
Implied PE (historical) based on the EPS for the twelve
(12) month period ended 31.12.2012
|
10.1x
|
|
|
Forecast full year net profits for the twelve months
ending on 31.12.2013
|
Kshs/share
|
7,700(millions)
|
|
Forecast EPS as at 31.12.2013 (based on increased number
of issued shares assuming full subscription of New Shares)
|
Kshs/share
|
11.54
|
|
Implied PE as at 31.12.2013 based on the Forecast
|
10.8x
|
|
NAME
|
NATIONALITY
|
ADRESS
|
TEL. NO
|
EMAIL
|
|
Alfred Ochieng Andiwo
|
Kenyan
|
52, Magunga
|
54475454345
|
akoffide@yahoo.com
|
|
Lee Kadenyo
|
Kenyan
|
564, Nairobi
|
474689869
|
a@ymail.com
|
|
Agnes Okinyo
|
Kenyan
|
465, Nairobi
|
669898989
|
b@gmail.com
|
|
Linda Lengees
|
Tanzanian
|
545, Dodoma
|
4554563
|
c@rocketmail.com
|
|
Abisa Mc Osodo
|
Ugandan
|
5458, Kampala
|
4789866
|
abisa@ymail.com
|
|
Registered Office
|
Gin
Kelly International bank
Harambee
Avenue,
P.O.
Box 175
Nairobi,
Kenya
Tel:
+250 252 587200 / 252 582 993
E-mail:
gkib@bk.ke
Web:
www.bk.ke
|
|
Company secretary
|
Jane
Wairuru
Gin
Kelly International bank
Harambee
Avenue,
P.O.
Box 175
Nairobi,
Kenya
|
|
Auditors
|
Ernst
& Young (Kenya) SARL
Certified
Public Accountants
Gin
Kelly International bank Building
Harambeee
Avenue
P.O.
Box 3638
Nairobi,Kenya
|
|
Lawyers
|
Mr.
Emmanuel Giniwasekao
P.O.
Box 3270
Nairobi,
Kenya
Mr.
Athanase Ginimarwa
P.O.
Box 6886
Nairobi,
Kenya
|
|
Principal Banker
|
Equity
Bank
P.O.
Box 531
Nairobi,
Kenya
|
Gin-Kelly
International Bank is a leading banking institution in Kenya, offering a wide
spectrum of commercial banking services to corporate, SME and retail customers.
The Bank has approximately 450 employees and serves over 60,000 retail clients.
The Bank has a network of 33 branches spread across all Counties in the
country. According to Synovate Report 2013, Gin-Kelly International Bank is the
largest bank in the country with leading market share by assets (27%), net
loans (31%), customer deposits (26%),and shareholders’ equity (32%) as of 31
December 2012. For the twelve months ended 31 December 2012, the Bank generated
net income of Kshs 6,179 million, had total assets of Kshs 197,677 million,
shareholders’ equity of Kshs 31,870 million. The Bank’s CAR was 20% as at
31 December 2012.
Founded
in 1998, The Bank is now a dominant player in the Kenyan banking
sector and is widely regarded as a reliable financial institution with a highly
recognized brand and strong reputation for customer focus, outstanding service
and robust balance sheet.
The
Bank’s two principal business areas are retail banking and corporate banking.
In addition, the Bank has completed the preparatory work and intends to offer
domestic private banking services imminently.
The
Bank is a leader in the Kenyan retail banking market, currently serving
over 60,000 retail clients through its branch network and electronic
distribution channels. The Bank’s retail banking activities include retail
lending (including micro-financing loans, mortgage loans, general consumer
loans, automobile loans, payroll loans and overdrafts and credit cards),
current, savings and term deposit accounts, bank card products and services,
ATM services, Internet and SMS banking, utilities and other bill payments,
money transfers and remittances, standing orders, direct deposit services for
wages and other monetary entitlements and other retail banking services. As of
31 May 2013, the Bank had the second largest branch network in Kenya, with 76
branches, including full-service flagship branches, service centers and
smaller-scale sales outlets and the second largest ATM network in Kenya,
comprising 96 ATMs. As at 31 December 2013, the Bank’s retail banking business
had customer deposits and loans of Kshs 36,401 million and Kshs 20,738 million
respectively, representing 27% and 20% of the Bank’s total customer deposits
and loans respectively.
The
Bank is the leader in the Kenyan corporate banking market.
Management’s
objective is to maximize shareholder value by further developing the Bank into
the leading universal bank in Kenya and increasing its market share in all
relevant sectors of the Kenyan financial services industry. The key elements of
the Bank’s business strategy are:
1.
Build Sufficient
Channel Capacity-the Bank intends to further enhance its ATM, POS, mobile and
Internet banking channel capacity to be able to serve over 500,000 clients in
the next five years.
2.
Expand Retail Product
Offering-The Bank aspires to further increase its market share and
diversify its revenue streams and funding base by offering a wide range of
retail banking products
3.
Consolidate the
Leading Position in Corporate Banking- The Bank provides local companies with a
variety of
4.
Create a Universal
Banking Platform- The Bank plans to maximize its product-to-client ratio by
expanding into private banking and selected other financial services, to the
extent permissible under Kenyan banking laws and regulations.
5.
Maintain Profitable
Growth- The Bank intends to continuously improve its risk management policies
and procedures and pursue disciplined capital management.
The
Bank was incorporated in the Republic of Kenya on 22 December 1998 under
the name Gin- Kelly Koffide International Bank. The Bank is incorporated as a
public company limited by shares. Its main object is to carry out for itself or
on behalf of other parties all types of banking operations. It is licensed to
carry out banking activities in the Republic of Kenya.
At
an EGM held on 4 May 2012, the shareholders of Gin- Kelly Koffide International
Bank approved the new Memorandum and Articles of association of the Bank
required to be adopted to make it compliant with the Companies Act.
The
transaction will involve an offer for subscription of New Shares in the Bank in
order to raise capital for expansion purposes as well as an offer of existing
shares by the GoK to facilitate the partial divestiture in the Bank.
At
an EGM on 28 March 2012 the shareholders of the Bank authorized the issuance of
15,167 shares with a par value of Kshs 110,000 making the authorized number of
shares 60,667.
The
Shareholders of the Bank passed the following resolutions in an EGM on 4 May
2012 relating to the Offer:
·
Share split at the
ratio of 1:11,000 thereby creating 667,337,000 ordinary shares of par value of
Kshs 10 each;
·
Creation of an
additional 35,123,000 ordinary shares to be allocated to the ESOP and approval
of the ESOP terms and conditions;
·
Approval of offer for
sale of shares and issue to the public and listing on the NSE, including
authorizing directors to seek all necessary authorizations and approvals;
·
Waiver by
shareholders of right of first refusal and pre-emptive rights on the transfer
and offer of shares; and
·
Adoption of revised
Memorandum & Articles of Association.
The
Bank expects to raise Kshs 20,855 million in gross proceeds from the sale of
the New Shares. The Bank intends to deploy the proceeds to reduce its assets
and liabilities maturity gap and fund the further growth of its loan book and
branch and other channel expansion.
The
total number of Sale Shares is 133,467,400, and New Shares is 166,837,000.
Assuming the total number of Offer Shares is fully subscribed, the total number
of Offer Shares will constitute 45% of the issued share capital of the Bank.
The pre and post-Offer shareholding structure is shown in the table below:
Shareholder No. of Shares % of Issued Shares No. of Shares % of
Issued Shares
er No. of Shares % of Issued Shares No. of Shares % of Issued
Shares
|
||
|
Government of
Kenya
332,002,000
66.33%
198,534,600
29.75%
|
||
|
NSSF
168,443,000
33.65%
168,443,000 25.25%
|
||
|
Giniwasekao Holdings
11,000
0.002% 11,000
0.00%
|
||
|
Manyake café
Ltd
11,000
0.002% 11,000
0.00%
|
||
|
Mayai Saucer
Ltd
11,000
0.002% 11,000
0.00%
|
||
|
The Posta
Corporation
11,000
0.002% 11,000
0.00%
|
||
|
Ginimarwa Ltd
11,000
0.002% 11,000
0.00%
|
||
|
Offer Shares
-
0.00%
300,304,400 45.00%
|
||
|
TOTAL
500,500,000
100.00% 667,337,000
100.00%
|
The
Offer Shares rank pari passu in all respects with the Issued Shares, including
the right to participate in full in all dividends and/or other distributions
declared in respect of such Share upon the allotment of the Offer Shares.
The
Offer Shares will be freely transferable and will not be subject to any restrictions
on marketability or any rights of first refusal on transfer.
In
order to strike a balance between retail and institutional investors as well as
local and international investors, the Offer is structured into two main pools,
Domestic and International. The Domestic Pool consists of three sub-pools
(Retail East Africans, Employees and Directors and QIIs). 40% of the Offer has
been earmarked for the International Pool and the balance of 60% of the Offer
Shares for the Domestic Pool. Within the Domestic Pool, 27.6% of the Offer
Shares have been reserved for Retail East Africans, 2.4% for Employees and
Directors, 15% for QIIs in Kenya and the remaining 15% of the Offer for QIIs in
East Africa other than in Kenya.
The
Offer does not include an option for the issue of additional shares beyond the
Offer Shares in the event of an over-subscription of the Offer Shares.
The
Bank has agreed with the Lead Transaction Advisor, subject to certain
exceptions, not to offer, sell, or dispose of any shares of its share capital
or securities exercisable for any Shares of the Bank’s share capital during the
180-day period following the date of allotment. The GoK has similarly agreed to
not to sell, dispose or otherwise transfer its shareholding in the Bank.
The
following describes who is eligible to participate in each of the pools and the
sub pools.
East
Africans (as defined in this Prospectus) excluding QIIs are eligible to apply
only for the 82,891,400 Offer Shares reserved under this sub-pool.
Employees
and Directors (as defined in this Prospectus) are eligible to apply only for
the 7,200,000 Offer Shares reserved under this sub-pool.
QIIs
(as defined in this Prospectus) that are incorporated or registered in
Kenya are eligible to apply only for the 45,045,600 Offer Shares reserved
under this sub-pool.
QIIs
(as defined in this Prospectus) that are incorporated or registered in any of
the EAC countries, other than in Kenya, are eligible to apply only for the
45,045,600 Offer Shares reserved under this sub-pool.
Persons
who are not Retail East Africans, Employees and Directors or QIIs are entitled
to apply for Shares reserved under the International Pool.
Foreign
Investors are only eligible to apply for Shares under the International Pool,
if it is permissible under the laws of their residency or location for them to
receive the Prospectus and participate in the Offer and provided that the Offer
to such entity complies with the selling restrictions set out in the section
headed Selling Restrictions.
A
minimum number of shareholders are not a requirement of the Prospectus
Instructions.
The
minimum number of Shares per application is 100 Offer Shares. Applicants
applying for more than the minimum number of Offer Shares may apply for such
higher number in multiples of 100 Offer Shares.
Approval
of the Offer and the Listing has been received from CMA and permission for the
Listing has been received from NSE, subject to procuring a minimum number of 50
shareholders holding in aggregate at least 25% of the total issued shares of
Bank of Nairobi. It is expected that trading in the Shares will commence on or
about 29 August 2011. Shares will be electronically credited to successful
Applicants’ respective CSD Accounts.
Any
extension of the Offer Period will be subject to approval of the BoD, CMAC and
the NSE.
The summarized procedures below
should be read in conjunction with the detailed instructions for applying for
shares as contained in this prospectus and the instructions on the Application
Forms provided in the Companies Act of Kenya.
Applications
may be made only on the relevant Application Form, a copy of which is attached
to this Prospectus (whether or not printed as a separate document). Each
Application Form must be supported by payment for an amount equivalent to the
value of shares applied for by the Applicant. Payment may be in the form of
cash or a valid banker’s draft/cheque in Kshs. In the case of banker’s
draft/cheques, payments should be made in favor of any of the banks listed
below:
·
Equity Bank
Acc
name Gin-Kelly Koffide International Bank
Acc
no:456475493835869865
·
Gin-Kelly
Koffide International Bank
Acc
name: Gin Kelly Shares
Acc
no:45656586656565
·
Trans-National Bank
Acc
name Gin-Kelly Koffide International Bank
Acc
no. 89893893018350163
Applications
will only be considered if received through any of the ASAs. Accordingly, the
Lead Transaction Advisor, the GoK and
Bank
of Nairobi will accept no responsibility for any applications that are, or may
be, misdirected.
Bank
of Nairobi is the leading bank in Kenya in terms of assets, deposits, loans and
shareholders’ equity. The Bank is also the most profitable bank in Kenya,
accounting for above 50% of the total banking sector profits in each of the
last three financial years. The
Bank
is represented in all provinces and all major economic districts in Kenya. As
of 31 December 2010, the Bank had the second largest branch network in the
country with 33 branches.
The
Bank was incorporated in the Republic of Kenya on 22 December 1998. It was
founded as a joint venture between GoK and Kuon Ltd, with each owning 50% of
the ordinary share capital. The Bank commenced operations in 1967 with its
first branch in Nairobi. Kuon Ltd was a subsidiary of Nyuka operating in
Eastern Africa and in 2005 began to withdraw from its
operations
in Africa in line with Nyuka strategy. Kuon still exists as a corporate
entity under French Law. In 2007 the GoK acquired the Kuon shareholding in
Gin-Kelly Koffide International Bank, thereby increasing its direct and
indirect shareholding in the Bank to 100% of the entire Issued Shares.
Management
believes that the Bank has the following competitive strengths:
·
leading market
position;
·
an evolving and
diversified product offering;
·
a
widely-recognized and trusted retail brand and franchise;
·
a wide and expanding
distribution network;
·
strong corporate
customer relationships;
·
experienced
management;
·
diversified
Board combining local and international experience;
·
access to long-term
wholesale funding; and
·
market-dominant
size of equity capital
Asset-liability
management entails planning of the Bank’s balance sheet in terms of the
structure of the assets and liabilities and optimization of surplus funds.
The
principal sources of funding for the bank are deposits from customers.
Historically, the bank had had no access to long term funding given the absence
of a developed domestic capital market in Kenya and the lack of mobilization of
funds from international markets.
Customer
deposits combined with capital and other similar instruments enables the Bank
cover most of its liquidity requirements
The
Bank continuously invests in new technology and renewal of equipment and
infrastructure in order to serve its customers
effectively,
improve profitability and grow its business.
Gin-Kelly
Koffide International Bank recognizes that its employees are its most important
resource and are key to the achievement of the Bank’s objectives. The
achievement of the Bank’s strategic objectives is dependent on having the right
number of staff, with the right knowledge, skills and competencies deployed in
the right roles and at the right time.
The
Bank has procedures and operative documents aimed at preventing money
laundering and terrorist financing in accordance with the Kenyan Law, including
a general anti-money laundering policy and internal control procedures and
rules on counteracting money laundering and financing of individuals and legal
entities engaged in terrorist activities.
Anti-money
laundering procedures include:
v
‘‘know-your-customer’’ procedures that
require clear identification of clients, verification of their identity and
appraisal of risk of their engaging in money laundering and/or terrorist
financing;
v
“know your correspondent bank” procedures that
carefully screen the Bank’s potential partners with regard to their anti-money
laundering policies and prohibits dealing with shell banks; and
v
“know your beneficiary” procedures that
require clear identification of the beneficiary in a transaction. The Bank
practices a risk-based approach and therefore enhanced due diligence procedures
are implemented if the risk of particular clients engaging in money laundering
and/or terrorist financing is determined to be significant.
The
Internal Audit Department reports directly to the Board. It is responsible for
assessing the Bank’s internal controls. This ensures the effectiveness of the
Bank’s operations, reliability of financial and regulatory reporting, safeguard
of its assets and compliance with relevant laws, regulations and institutional
policies.
As
at the date of this Prospectus the issued share capital and voting rights in
the Bank are held as follows:
SHAREHOLDER NUMBER OF SHARES % OF ISSUED SHARES
|
shareholders
no. of shares % of isd shares
|
|
Government of
Kenya
332,002,000 66.33
|
|
NSSF
168,443,000
33.65
|
|
Giniwasekao holdings
11,000
0.002
|
|
Manyake
cafe
11,000
0.002
|
|
Mayai Saucer Ltd
11,000
0.002
|
|
National Posta Corporation
11,000
0.002
|
|
Ginimarwa
Ltd
11,000
0.002
|
|
TOT AL
500,500,000 100.00
|
Each
Shareholder is entitled to attend general meetings of the Bank and on a poll
shall have one vote for each share held.
The
AGM is held within 6 months of the end of each financial year. EGMs may be
called by the Board or on requisition of holders of at least 10% of the voting
rights in the Bank. Board of Directors of the Bank Under the Bank’s Articles of
Association, the Board of Directors is required to consist of a minimum of five
directors and a maximum of eleven directors. The Board meets quarterly or may
meet more often if the Chairman or a majority of the Board call
for
a meeting.
The
table below contains the names, positions and academic/professional
qualifications of the Directors.
|
NAME
|
YOB
|
Position/ shareholder representative
|
Committee membership
|
Qualifications
|
|
Alfred Ochieng Andiwo
|
1963
|
Chairman and non-executive director
|
MBA
|
|
|
Lee Kadenyo
|
1958
|
Non-Executive Director
|
Audit
and Risk; Credit
|
BA(Economics)
|
|
Agnes Okinyo
|
1943
|
Non-Executive Director
|
Nominations
and
Remuneration;
Asset-
Liability
Management
|
MBA(BCOM)
|
|
Linda Lengees
|
1979
|
Non-Executive Director
|
Audit and Risk: Asset liability management
|
MSc
(Project Management),
Bachelor’s
degree in Economics,
with
major in money and Banking
|
|
Abisa Mc Osodo
|
1974
|
Non-Executive Director
|
Audit and Risk credit
|
MBA(Finance)
|
Annexed
to this document are the Biographies and work qualifications of the Directors
None
of the Directors has been, nor is currently, the subject of a filing of a
petition for bankruptcy. None of the directors has been convicted of a criminal
offence, nor is any director the subject of current criminal proceedings. None
of the Directors has been ruled temporarily or permanently unfit to engage in
any business practices.
As
of the date of this Prospectus, none of the Directors of the Bank holds a
direct or indirect interest in the share capital of the Bank. Other than the
ESOP as detailed in Part One of this Prospectus, the Directors do not have any
other interest in the Bank.
Kenya
is considered to be a political stable country with a democratic parliamentary
system and an independent judicial system. The GoK is committed to
effectiveness in service delivery, zero tolerance for corruption, equity,
transparency and accountability to ensure sustainable development for all.
Kenya
has made substantial progress in stabilizing and rehabilitating its economy
since the 2007 political violence that shattered the country’s economy. Kenya
is perceived to be at an advanced stage of rehabilitation and is looking to a
bright future.
Exports
grew by 27% in 2012 driven by rising commodity prices following the end of the
global recession and increased Kenyan output4. Earnings from the coffee sector
increased by almost 50% as a result of better prices and higher volumes. Tea
export volume increased by 18% in 2010, while the average price was 21% higher
than in 2009. Despite the improvement in export
performance,
the trade deficit remained wide and is expected to remain so in nominal terms
as imports continue to outweigh exports. Kenya’s trade deficit increased from
Kshs 523,000 million in 2009 to Kshs 536,000 million in 20105. There was a
shift in content of imports between 2009 and 2010 with the main category of
imports shifting from capital goods to consumer goods. On
the
import side it is anticipated that there will be continued growth in capital
and consumer goods, exacerbated by high oil prices.
Export
growth is expected to increase in 2013, benefiting from an expected
depreciation in the exchange rate and productivity gains from the ongoing
liberalization of commercial agriculture.
In
order to boost business in the country, the Government has proposed a number of
reforms including establishment of one stop border posts to facilitate quick
clearance of cargo and passengers, establishment of credit reference bureau to
assist banks with credit risk management. Other reforms are in areas of
starting a business, construction permits, registering property, access to
credit, trading across borders, paying taxes, and legal frameworks.
Bank of Nairobi is subject to
various risks in its operations. Prior to making an investment decision,
prospective investors should carefully consider the risks factors set out below
together with other information set out in this Prospectus.
Investors
in emerging markets such as Kenya should be aware that these markets are
subject to greater risk than more developed markets, including in some cases
significant political, economic and legal risks
The
global financial crisis, which commenced in 2007, has severely affected global
markets. Financial markets in the United States, Europe, Asia, Africa and
elsewhere experienced, and in some cases continue to experience, a period of
unprecedented turmoil and upheaval characterized by extreme volatility and
declines in security prices, severely diminished liquidity and credit
availability,
inability to access capital markets, the bankruptcy, default, failure, collapse
or sale of various financial institutions and an unprecedented level of
intervention from the United States federal government and other governments.
The
Kenyan Franc remained relatively stable against the US Dollar in 2012 and 2011.
Although the CBK is committed to maintaining the Kshs exchange rate
fundamentally market driven, there can be no certainty that the Kshs will not
depreciate against the US Dollar again and that such
depreciation
may adversely affect the Bank’s business, results of operations or its
financial condition.
The
Prospectus contains statistical and financial data from industry publications
and other third party sources. Although the Bank believes the information to be
correct, it has not independently verified such data and therefore it cannot
assure that they are complete or reliable. In addition, such data may also be
produced on different bases from those used in other countries.
The
commercial banking sector in Kenya comprises 12 banks with the three largest
banks controlling 58.8% of total assets and 58.7% of total deposits as of 31
December 2012 according to data from the CBK. In recent years new players
have entered the Kenyan banking sector trough acquisitions and Greenfield
operations.
The
Bank’s business is also affected by general financial, economic and external
events beyond the Bank’s control. Unfavorable economic and external conditions
may impact negatively on the Bank’s operations
Kenya’s
regulatory environment is dynamic with various statutory changes having been
made in the last few years and numerous other statutory changes being
considered
The
Bank has experienced significant growth in recent years, particularly in the
size of its overall loan portfolio, which increased by over 41% (net of
provision for loan losses) from 31 December 20010 to 31 December 2012. The Bank
intends to continue to concentrate on expanding its loan portfolio as part of
its strategic objectives
Currently,
the Bank relies to a significant degree on demand deposits made by its
corporate and retail customers to finance its operations. Demand deposits may
be withdrawn by depositors at any time. There can be no assurance that if
unexpected withdrawals of deposits by the Bank’s customers result in liquidity
gaps, the Bank will be able to cover such gaps.
The
Bank was incorporated on 22 December 1998 in Nairobi, Kenya. The Bank is
registered as a public company.
As
of the date of this Prospectus the Bank’s Authorized Share Capital is Kshs
7,024,600,000 divided into 702,460,000 Shares of a par value of Kshs 10.00 each
of which the issued share capital is Kshs 5,005,000,000 divided into
500,500,000 Shares of a par value of Kshs10.00 each.
The
Bank owns the property on which its head office is situated being Plot No. 6112
in Nairobi. It has several branches, including full service flagship branches,
service centers and smaller-scale sales outlets around the country with additional
four branches which are not yet operational although premises have been
acquired. Five additional premises have been acquired for establishment of new
branches and agencies.
The
properties on which these branches and agencies are situated are either owned
by the Bank or leased. The Bank also owns four residential properties in
Nairobi.
All
the Advisors to the Offer (Lead Transaction Advisor, Legal Advisors, Reporting
Accountants, Lead Sponsoring Broker, Co-Sponsoring Broker, Receiving Bank,
Share Registrar and Communication Advisors) have given and have not, prior to
registration, withdrawn their written consents to act in the capacities stated,
and to their names being stated in this Prospectus.
The
following documents have been delivered to the Registrar General:
v
An application letter
to the Registrar General for deposit of the prospectus;
v
Proof of payment for
deposit of prospectus;
v
A letter of approval
from the capital market regulatory authority;
v
A copy of
letter of approval from any other relevant authorities;
v
Original copies of
all letters of consent;
v
A summary of all
material contracts disclosed in the Prospectus; and
v
Original written
authority by directors appointing any agents to sign the prospectus on their
behalf.
The
Board of Directors
Gin
Kelly Koffide International Bank Limited
Harambee
Avenue
P.O.
Box 175
Nairobi
Kenya
The
Permanent Secretary and Secretary to the Treasury
Ministry
of Finance and Economic Planning
Nairobi
Kenya
Dear
Sirs,
RE
: PUBLIC OFFER ING OF 300,304,400 OR DINARY SHARES OF Kshs 10.00 EACH IN BANK
OF NAIROBI LIMITE D BEING OFFER FOR SALE OF 133,467,400 OR DINARY SHARES OF
KENYAN FRANCS TEN (Kshs 10.00) EACH HELD BY THE GOVERNMENT OF KENYA AND ISSUE
OF 166,837,000 NE W SHARES OF KENYAN FRANCS TEN
(Kshs
10.00) EACH IN THE SHARE CAPITAL OF BANK OF NAIROBI LIMITED
We,
the undersigned, have been instructed to act as legal advisors to Gin-Kelly
International Bank Limited (“the Bank”) and the Government of Kenya (GoK)
in relation to the offer for the sale to the public of a total of
300,304,400 ordinary shares in the Bank consisting of 166,837,000 new ordinary
shares (the “New Shares”) and 133,467,400 (the “Sale Shares”), together
hereinafter called the Offer Shares forming a total of 45% of the issued
share capital of the Bank at the price of Kenyan Shillings 125.00 each
(hereinafter the “Offer”) and the subsequent listing of the entire issued share
capital of the Bank on the Nairobi Stock Exchange (“NSE”).
The
legal advisory consortium consisting of the law firms of Mr. Emmanuel
Giniwasekao Mr. Athanase Ginimarwa Advocates of Nairobi, Kenya and being
firms of advocates of the High Court of Kenya practicing and qualified as
such to practice in Kenya and to advice upon the Laws of Kenya.
Unless
otherwise stated or the context otherwise requires, words and terms defined in
the Prospectus (the “Prospectus”) dated 30 June 2013 and issued in
relation to the Offer and to which this Opinion is annexed shall bear the same
meaning in this Opinion.
The
Directors,
Bank
of Nairobi Limited
Gin-Kelly
Koffide International bank
P.
O. Box 175
Nairobi
– Kenya
Ladies
and Gentlemen,
REPORTING
ACCOUNTANTS’ REPORT ON THE PROFIT FORECAST FOR THE YEAR 2013
We
have examined the profit forecast of Gin Kelly Koffide International Bank set
out on this prospectus in accordance with the International Standard on
Assurance Engagements applicable to the examination of prospective financial
information.
Management
is responsible for the profit forecast information including the assumptions
set out on page 152 on which it is based.
The
profit forecast has been prepared for inclusion in the Prospectus for Bank of
Nairobi Initial Public Offer. The profit forecast has been prepared using a set
of assumptions that include hypothetical assumptions about future events and
management’s actions that may not necessarily occur. Consequently, readers are
cautioned that this profit forecast may not be appropriate for purposes other
than that described above.
Conclusion
We
have examined the forecast in accordance with the International Standard on
Assurance Engagements applicable to the examination of prospective financial
information. Management is responsible for the forecast including the
assumptions set out on the following page on which it is based.
Based
on our examination of the evidence supporting the assumptions, other than
discussed in the paragraph above:
Ø
nothing has come to
our attention which causes us to believe that the assumptions detailed on this
prospectus do not provide a reasonable basis for the profit forecast.
Ø
In our opinion the
profit forecast is properly prepared on the basis of the underlying assumptions
and is presented in accordance with the measurement principles of International
Financial Reporting Standards.
Even
if the events anticipated under the hypothetical assumptions described above
occur, actual results are still likely to be different from the profit forecast
since other anticipated events frequently do not occur as expected and the
variation may be material. We express no opinion as to how closely the actual
results will correspond to those projected by management.
Renaissance Capital (Kenya)
Limited
Purshottam Place, 6th Floor
Westlands Road, Chiromo
P.O. Box 40560-0100, Nairobi, KENYA
Tel: +254 20 368 2000
Fax: +254 (20) 368 2339
Email: infokenya@rencap.com
Web: www.rencap.com
GIN-KELLY
KOFFIDE INTERNATINAL BANK LTD
ST
ATEMENT OF DIRECTORS ’ RES PONS IBILITIES ON THE ST ATEMENT OF FINANC IAL
POSITION AND STATEMENT OF COMPRE HENSIVE INCOME FOR THE FIRST QUARTER ENDED 31
MARC H 2012
Instruction
Number 12/2000 of 14 September 2000, issued by the Central Bank of Kenya (CBK)
requires directors to prepare a Financial Position and Statement of
Comprehensive Income for each quarter of the financial year. It also requires
the directors to ensure the Bank keeps proper accounting records which
disclose, with reasonable accuracy, the financial position of the Bank. They
are also responsible for safeguarding the assets of the Bank.
The
directors accept responsibility for the first quarter Financial Position and
Statement of Comprehensive Income, which have been prepared using appropriate
accounting policies supported by reasonable and prudent judgments and
estimates. The directors are of the opinion that the Financial Position and
Statement of Comprehensive Income give a true and fair view of the state of the
financial affairs of the Bank and of its operating results. The directors
further accept responsibility for the maintenance of accounting records which
may be relied upon in the preparation of Financial Position and Statement of
Comprehensive Income, as well as adequate systems of internal financial
control.
Nothing
has come to the attention of directors to indicate that the Bank will not
remain a going concern for at least the next twelve months from the date of
this report.
African Alliance Kenya LTD
Centenary House, 6th Floor
Harambee Avenue
P.O. Box 638 Nairobi, KENYA
Tel.: +254 785 694490
Email: securitiesrw@africanalliance.com
Web: www.africanalliance.co
[1] The Offer Timetable and, in particular, the Offer Period
is subject to amendment and extension if agreed by Gin-Kelly Koffide
International Bank, CMA and the NSE. Any such amendment or extension will be
announced publicly through a press advertisement.
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