Good morning. Here’s what you need to know
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Indo Zambia Bank declares K50 million dividend cheque
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Zambia and Botswana Cement Partnership with Signing of 10 MOUs
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About $1 billion mobilised for Lobito Corridor project linking Zambia, Angola, DR Congo
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Central bank of Nigeria raises interest rates to combat soaring inflation
In Local Business and Finance News
While the country continues to face economic challenges, the banking sector continued to post healthy profits in 2023. Data shows that Indo Zambia Bank (IZB) has posted a K604.33 million Net Profit after tax for the year ended 31st December, 2023, significantly exceeding its budgeted profit of K540.70 million. According to the Bank’s Board Chairperson Michael Gondwe, this represents an 18.74% percent increase in after-tax profit from 2022. Presenting the Bank’s 2023 financial statement in Lusaka, Mr. Gondwe disclosed that the Bank’s total interest on advances grew by 19.16% and amounted to K732.91 million as at 31st December 2023 compared to 2022, while total revenue grew by 8.65% and crossed the K2.0 billion mark. He explained that the Bank achieved an operating profit of K1billion in the year under review, against K826.14 million in 2022, with a growth rate of 21.05%, which is a milestone achievement. Read more: Money FM
Indo Zambia Bank (IZB) has declared K50 million in dividend cheque to one of its shareholders, Industrial Development Corporation (IDC). This is part of the K125 million dividend payout approved by Shareholders in the 2023 financial year to pay the bank’s shareholders in 2024 as it celebrates 40 years of existence. Speaking shortly after receiving the cheque, IDC Chief Executive Officer Cornwell Muleya said the K50 million dividend cheque is 25 percent higher than the K40 million the bank declared in 2023 and this is a testimony to the long lasting friendship that exists between Zambia and India. Read more: Money FM
Zambia and Brazil have signed an agreement aimed at accelerating the revival and transformation of Zambia’s cotton industry. And Agriculture Minister, Reuben Phiri says government wants to boost production of the cotton industry to regain its past performance. Mr. Phiri says government is confident that the cotton industry is able to produce more than 250m Kilograms. The Agriculture Minister said this In Lusaka at a signing ceremony of the bilateral project dubbed ´Strengthening of the cotton value chain in Zambia’. He has urged the Cotton Board of Zambia and the Department of Agriculture to be prudent in the use of the resources and adhere to the principles enshrined in the cooperation agreement. Read more: ZNBC
The Ministry of Small and Medium Enterprise Development will host the first ever Macro, Small and Medium Enterprises and Cooperatives National Indaba. The Indaba to run from 10th-11th April 2024, will attract participants from Botswana, India, Kenya and Malawi among others. Speaking during the launch, Small and Medium Enterprise Development Minister Elias Mubanga said the Indaba will be a platform to learn practices from other countries. Read more: ZNBC
In a significant move to bolster their partnership, Zambia and Botswana have solidified their commitment through the signing of ten Memoranda of Understanding (MOUs) covering various critical sectors. These agreements were inked less than two months after a productive visit to Kasane, marking a pivotal moment in the strengthening of economic ties between the two nations. Crafted with precision and foresight, these MOUs span across sectors such as Science and Technology, Mining, Minerals, Agriculture and Livestock, Railway Transport, and the Establishment of the Kazungula Bridge Authority (KBA), among others. President Hakainde Hichilema and President Mokgweetsi Masisi of Botswana expressed their profound gratitude for this significant step forward, emphasizing the potential these agreements hold for enhancing economic growth and benefiting their citizens. Read more: Lusaka Times
Bondholders will provide approximately US$2.5 billion in cash flow relief to Zambia through reduced debt service payments following the agreement to restructure the existing debt between the two parties. This would be provided during the International Monetary Fund (IMF) programme period. Finance and National Minister, Situmbeko Musokotwane, said this when delivering a speech on the restructured debt in Parliament on Wednesday. Under this agreement, the bondholders would also forego approximately US$840 million of their claims through a haircut on the outstanding balance on the bonds and accrued interest. He noted that the implication of the agreement with the bondholders and OCC was that government would resume making debt service payments on the restructured debt. This, he explained, required funds to be made available in the budget to meet the obligations falling. “We will continue engaging other commercial creditors on a Non-Disclosure basis, with the determination of getting debt treatments on terms comparable to what has been agreed with both the OCC and the Bondholders,” Musokotwane said. Read more: Zambia Monitor
Financiers for the Lobito Corridor project linking Zambia and Angola have announced that almost US$1 billion financing towards the project has so far been mobilised. This reportedly is the largest single United States (US) and European Union (EU) investment on the African continent in recent years. The US International Development Finance Corporation in February this year announced new financing in support of the Lobito Corridor, a transnational 1, 300-kilometre railway line linking Angola’s Port of Lobito with southern Democratic Republic of Congo and north-western Zambia. The US and its partners, which included the European Commission, African Development Bank and Africa Finance Corporation had so far mobilized nearly US$1 billion for the project, according to a statement issued on Monday. Read more: Zambia Monitor
In International News
Nigeria’s central bank implemented a significant increase in its monetary policy rate, raising it by 200 basis points to 24.75% from the previous 22.75%, according to Governor Olayemi Cardoso on Tuesday. This decision marks a continuation of the bank’s efforts to combat surging inflation. Last month, the bank executed its most substantial rate hike in approximately 17 years, elevating the rate by 4 percentage points in a bid to rein in inflationary pressures. With inflation surpassing 30% on an annual basis, reaching its highest level in nearly three decades, the country grapples with a cost of living crisis affecting millions of its citizens. Read more: Africa News
Mergers and acquisitions (M&A) bounced back in the first quarter after a downbeat 2023, thanks to the return of mega deals, cheering investment bankers and lawyers waiting for a pick-up. Total M&A volumes globally climbed 30% to about $755.1 billion, according to the most recent data from Dealogic. The number of transactions worth more than $10 billion jumped to 14, compared with five during the same period last year. Investment bankers said boardroom confidence for dealmaking has improved on the back of strong earnings, potential interest rate cuts this year and an ebullient market. “When you see larger deals happening, it’s a much more direct sign of the returning health of the market, because boards and CEOs, due to the nature of large deals, are going to be more conservative when they approach them,” said Blair Effron, co-founder of investment bank Centerview Partners. “We do think that the activity that we see today is heading in the right direction.” Read more: Reuters
Toyota Motor’s global sales dropped 7% in February from a year earlier, hurt by a heavy decline in China due to Lunar Year holidays and a slump in Japan after a safety test scandal at its small car unit. Sales in China – the world’s biggest auto market – tumbled 36%. This year the week-long Lunar New Year holiday took place in February while last year it occurred in January. China’s auto market is also engaged in a cut-throat price war and Toyota said sales were affected by fierce competition. Read more: Reuters
The US stock market has hit a record high after a string of downbeat trading sessions. All three leading stock indexes rose on Wednesday, ending a three-day lull. The S&P 500, which tracks the performance of 500 of the largest US companies, finished up 0.9 percent on Wednesday, surpassing last week’s record. The rise leaves the benchmark index up more than 10 percent so far in 2024. The Dow Jones Industrial Average and Nasdaq Composite rose 1.22 percent and 0.51 percent, respectively. Among the big corporate players, Apple and Tesla climbed 2.12 percent and 1.22 percent, respectively, while semiconductor company Nvidia Corp declined 2.5 percent. Read more: Al Jazeera
Cocoa extended its surge — gaining more than $700 per ton in a single day and surpassing $9,000 for the first time ever — as a supply crunch grips the market and chocolate makers grapple for beans. Futures in New York climbed for a fourth straight day, adding to gains after news about funding challenges in Ghana, the world’s second-largest grower. The country is set to lose access to a key funding facility as a crisis in its cocoa crop has left it without enough beans to secure the money. The Ghana Cocoa Board, the industry regulator known as Cocobod, relies on foreign financing to pay cocoa farmers for their beans. Prices are up about 60% this month alone and have more than doubled already this year. Poor harvests on the back of bad weather and crop disease in West African growers, where most of the world’s cocoa is grown, and little sign of production relief elsewhere have left the industry in a bind. Read more: Mining
Finally, Capital Markets News
In 135 trades recorded yesterday, 45,551 shares were transacted resulting in a turnover of K256,966.60. The following price changes were recorded yesterday: -K0.03 in Standard Chartered Bank Limited and +K0.19 in ZANACO. Trading activity was also recorded in AECI, CEC Zambia, Zambeef, Zambia Sugar and ZAFFICO. The LuSE All Share Index (LASI) closed at 12,741.87 points, 0.41% higher than it’s previous close at 12,690.33 points. The market closed on a capitalization of K97,930,228,051.37 including Shoprite Holdings and K63,147,542,611.37 excluding Shoprite Holdings.
23 Govt Bond trades with total face value of K124,476,000 were processed yesterday, resulting in a total turnover of K105,620,810.