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HEADLINE NEWS..:
Kenyans, Ugandans in Diaspora wary of motherland investments as Equity Bank returns for more
James Mwangi
PHOTO:Kenya's Equity Bank Group CEO, Dr. James Mwangi.PIC BY COURTESY/ALL AFRICA
 

By:
HARRISON MAINA

Posted:
Jul,12-2017 13:34:02
 
BOSTON__Recent reports of a Kenyan business man from Boston on the verge of losing half a billion Kenya Shillings after purchasing a 30 acre piece of land in a prime Nairobi location whose ownership is contested by Equity Bank CEO, Dr. James Mwangi as well as the United States International University- USIU, has made Kenyan Diaspora investors in the region to re-assess their investments engagements back in the motherland.

At the same time, many Kenyans in the Diaspora are growing skeptical of the nonexistent corporate responsibility of many Kenyan based commercial banks that have recently invaded the Diaspora in a maddening scramble by east African based banks hunting for lucrative foreign deposits from their Diaspora citizens, which they use to lend back at from 15% to as much as 21% interest rates.

Compared to the much cheaper borrowing in the US at current average of 4.15% on a 30 year fixed mortgage, and 6.70% on most personal loans, most Kenyans and Ugandans targeted by these banks are unaware of the lopsided raw deals, leaving concerned diaspora members calling for a re-thinking of how the Diaspora is engaging with motherland banks.


However, even while making billions of profits in local currencies, some of which is re-invested back to the lucrative US financial markets, the commercial banks have been giving absolutely nothing back to the community they claim to so much cherish--only showering them with praise for their "patriotic responsibility" of sending billion of dollars back to Africa in annual remittances.

Other Kenyans also remained deeply troubled by reports of widespread theft of public funds including those earmarked for much needed healthcare, leaving the Diaspora to continue sending big sums to help ailing relatives while mismanagement remains rampant wish no yet to be seen consequences.

The concerns come at a time when the Equity bank, a bank that made its real take off after receiving millions in cheap deposits it gained after approaching the Kenyan Diaspora back in 2008 with promises of easily available cheap loans, is making a return to Boston this Sunday, pitching new investment opportunities available in East Africa where is aiming to spread influence.

Led by Dr. Mwangi himself, Equity will be holding an investment conference in Framingham where it hopes to attract new foreign investment from the Diaspora.

However, many Kenyans who contacted Ajabu Africa News with concerns indicate that they are wary of the security of their investments in Kenya, if Dr. Mwangi himself, the CEO of the leading bank in Kenya can lose over KSH 300 million in the land deal he claimed to have purchased from the former Kenyan President, Daniel Arap Moi.

According to recent reports from the Daily Nation, Kenya's leading daily newspaper, the former president alleges that Dr. Mwangi was conned out of his investment by his own attorneys, as he (Moi), only recognizes Dr. George Kiongera ,a renowned and respected business and community members in Boston who owns the Maestro Connections Health Systems as the only person he sold the land to. (Recap story here:Moi says Equity CEO conned out of Sh300m in land row)

To complicate matters further, the United States International University also lays claim to the same land that it insists it purchased from the former president.

As the tantalizing dispute makes its way through the Kenyan courts with a new mention expected on Wednesday next week , many Kenyans in the region are wondering who they can ever trust again to handle their investments back in the motherland.

"I mean, come on now. If Dr. Kiongera and Dr. Mwangi can lose KSH500,000,000 in an investment that all attorneys from both sides claim to have had done due diligence, then you hear the titles produced to effect the purchase were all fake, who can you trust  to handle your small investment by comparison," said a concerned Kenyan who preferred to remain anonymous.

Many Kenyans are also concerned that many banks visiting the Diaspora for business, including Equity bank, Kenya Commercial Bank, Family Bank and others do not seem to realize that the community they derive business in have many children born in USA who would greatly benefit from a little bit of social responsibility by the banks if they were giving back some of their windfall profits to the Diaspora.

According to the most recent performance results released by Equity bank last month, the bank's profits before tax for the 9 month period to September 2016 was KSH21.5 billion, an increase of 18 % over the same period last year.

In comparison, KCB pre-tax profits for the first half of 2016 grew by 14 % to KSH 15.1billion, while Co-Operative Bank of Kenya posted a net half year profit of KSH7.41 billion.

Unfortunately, Family Bank, another Kenyan Diaspora hunting bank had a bad year when its 9 month period profits fell to 963.3 million from 1.86 billion over the same period a year before, mainly due to what it called "retrenchment costs", although bank officials remained optimistic that the bank will return to better days in the near future.

"It just makes no sense that we are the ones with the capital yet instead of going after investors here, like hedge funds managers who would guarantee the safety of our money, we go to Kenya and African investors most of whom are not 100% legit,” said popular Boston DJ, Ezra "Husky" Mwangi during a heated debate in the newly launched Ajabu Diaspora Network WhatsApp Diaspora Think Tank Group.

Mwangi added that the banks do not even offer Diaspora based kids or customers here any scholarships like the frequent flyer miles or other small incentives given by airlines to massage their customers.(
To join the exclusive, invitation only think tank for the ongoing discussions, text your Name and mobile Phone Number to:781-953-2490).

Other Kenyans contend that returns yields of investments well positioned in the US markets are much higher than those in Kenya, with the added benefit of being more secure than those in Kenya

Think tank members also decried the notion that Kenyan based Banks and other investment companies often dismiss the intellectual capabilities of Kenyans in the Diaspora, who have time and again failed to initiate any meaningful community or investment projects due to existing tribal and religious divisions, manipulation as well as unhealthy competition.

As a result, the Diaspora has been effectively relegated to mere spectators or followers of innovation and advancement going on, instead of leading in ideas like Diasporas from other countries like Israel, India and Australia do.

"They only view us as cash cows. They give us predatory loans.They take advantage of our differences and mistrust of each other. We should be telling them what to do instead of them coming all the way here to advise us. Something is very wrong," said a member in a post contribution.

The concerned Kenyans called on their counterparts to mobilize and force the banks to adjust their lending rates to aling with those of USA.

"I would not advise any Kenyan to take these predatory loans. We should come together and have these banks listen to us and reduce the rates they give to the Diaspora to those in America," said Omondi Owera, contributing from Seattle, Washington.

Although many Kenyans in the Diaspora send money back home to sit in the commercial backs in the hopes that they will return back home soon, the reality of the matter is many will never return permanently.

According to a upcoming piece by a newly acquired Ajabu Africa Columnist, many Kenyans and Africans who send all their money back home to invest there, then relocate back home after decades in the West end up disillusioned with motherland life.

"They quickly find out that they can't fit anymore. Friends they used to know are no longer in their league, many have much older children and they wonder what you have been doing in the Diaspora".

"He years to return "home" to the US in the US to his little comforts. Who would have thought a toilet is such an important asset? Who would have thought some “simple” ailment as the flu could be so misdiagnosed and end one almost getting killed by the "doctors"'? Wrote Kahungura wa Nyakiondo in a snap preview of the upcoming column where the Diaspora returnee character Fundi rushed to take the next available flight out of JKIA to escape the miserly for the second time since he first left Kenya with high hopes.

Other Kenyans blamed fellow Diaspora based compatriots of selling them out to the banks when they cut out personal deals and get paid to organize and mobilize while not advocating for the thousands of the Diaspora kids missing out.

When they pay a visit to the Diaspora, Bank leaders usually use the churches perceived as "big" as a platform to mobilize for their events, on the understanding that they will leave some tithes and offerings.

However, clergymen who welcome the entrepreneurs to these churches do not care to lobby such bank CEOs for a support of the programs propagated by the Kenyan Diaspora community to benefit our children, especially allocating funds to teach Swahili or other cultural languages.

"We have some Kenyans here who are only interested in serving their own needs. They only think about buying plots and building houses back home that they hardly will ever live in. They never pause to think of the legacy we are building to leave for our children who will most likely never want to live in Kenya for life," said another concerned Kenyan mother of two.

Other Kenyans have complained that they have received a lot of hard time trying to access loans from Equity bank as it had promised at St. Stephen's church in Lowell back in 2008 to anyone who holds a job in the Diaspora.

Although many banks have charitable foundations to help fund the education and other needs of orphaned and other needy children back in Kenya, the amount of funds they appropriate for the cause is very tiny compared to the amount of profits they get.

Therefore for Kenyans and other east Africans who plan to attend the Equity bank event were urged by concerned Kenyans to inquire from Dr. Mwangi why Equity and other Kenyan banks have failed to sponsor any Kenyan Diaspora community events in Boston, or even give back in any meaningful way to the community where it has "eaten" a lot from--even after such requests were made by to fund community based programs envisioned by the New England Kenyan Welfare Association.(Click here to view proposed, underfunded Diaspora community programs)

Source:
AJABU AFRICA NEWS

 
 
 
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