Here are three big stories from Africa’s business landscape you should keep in mind this week:
The CBN went on a licence-revoking spree
On May 24th, the Central Bank of Nigeria revoked the operating licences of 132 microfinance banks, four primary mortgage banks, and three finance companies.
Notably, the CBN’s reasons for this carnage varied from one bank to another. But in summary, the affected banks had either been inactive, were broke, didn’t submit required documents, provided no returns, or stopped doing the kind of banking they were supposed to do for over six months. According to the apex bank, being in any of these positions goes against the Banks and Other Financial Institutions Act (BOFIA), 2020, and the Revised Regulatory and Supervisory Guidelines for Microfinance Banks in Nigeria.
More attention was on Eyowo, which claims to have onboarded over 3 million Nigerian users since its inception. The budding digital bank reportedly went through a turbulent year in 2022 and has not recovered.
Patricia’s hack came to light.
Patricia, one of Nigeria’s leading crypto marketplaces, announced that it suffered a security breach. As a result, it had to put withdrawals on hold. “Not long ago, we were victims of a hack. Patricia, the retail trading application, was solely affected by the breach,” it said in an email to its customers last week. The company stated that only its bitcoin and naira assets had been compromised, while other crypto assets were intact.
Patricia later announced that it had found the culprit — a “syndicated group”—and had started taking legal steps against them.
However, new reports show that this breach is not so recent. It happened in January 2022 and cost the company $2 million. Patricia has been trying to manage this situation since then by buying coins from customers who wanted to move their assets to other wallets. But now, it seems to be in a tight position. Will this be a self-inflicted bank run? We hope not.
Nvidia’s rally hasn’t peaked.
The debate about the AI wars has centred around Google, Microsoft, Meta and OpenAI. However, one company is already profiting from this wave.
Nvidia Corp, the world’s most valuable chipmaker, has seen a $184 billion surge in its stock price this year, making it the best-performing stock on the S&P. The company, whose original business was selling graphics cards to gamers, has become the centre of the AI boom.
Now, the CEO, Jensen Huang, has announced that the company is unveiling new AI products to further capitalize on the frenzy. The offerings include the DGX GH200 supercomputer for creating advanced chatbots, networking systems to enhance data centre speed, a collaboration with WPP for cost-effective advertising production using AI and the metaverse, and Nvidia ACE for Games, which brings more personality to video game characters through AI-generated responses. Microsoft, Google and Meta are among the expected first clients of some of these offerings.
ICYMI: Market roundup
- Nigeria’s stock market had a slightly positive week, with the NGX All-Share Index gaining 1.51% to close at 52,187.93 points. The top gainers were FTN Cocoa Processors (54.55%), R T Briscoe PLC (40.74%), Chams Holding Company (36.67%), Tripple Gee and Company (32.20%), and University Press (20.32%). Top decliners were Sovereign Trust Insurance (−20.00%), Chellarams (−18.78%), Ardova (−13.90%), Royal Exchange (−7.69%), and Neimeth International Pharmaceuticals (−7.33%).
- The naira closed the week at N464.51 against the dollar at the Investors’ and Exporters‘ window, up from last week’s N462.00.
- Brent crude oil is $77.49 per barrel, up from last week’s $76.51. West Texas Intermediate (WTI) crude oil is $73.27 per barrel, up from $72.27.
- The crypto market rose 3.57% over the week to a $1.16 trillion market cap. Bitcoin gained 3.96% to close at $27,924, Ethereum gained 4.76% to reach $1,901 and BNB gained 2.25% to close at $314.
- Dawi Clinics, the largest chain of outpatient care in Egypt, has raised EGP 250 million ($ 8 million) to fund the growth of its chain of clinics across the Egyptian market.
- South Africa’s Play Sense, an independent preschool that offers play-based learning through its online micro-schools platform plaDorm, has secured an undisclosed funding round.
- Kunda Kids, a children’s media publisher and creative studio announced a $700k pre-seed round and the launch of its flagship animation series on YouTube, Kunda & Friends, which will premiere today.
- South African digital banking platform, TymeBank, has raised USD 77.8 M in a pre-Series C round.
