Africa, Business, invesment, Invesments, news, Uncategorized, World Bank, World Bank Group

Africa News February 07, 2014 at 11:25AM

this blog is spored BY reflex Eco Group

VENTURES AFRICA – Johannesburg and London-listed private and investment bank, Investec, is looking at disposing of its underperforming UK-based subprime mortgage lender, Kensington, it said late on Thursday.

Kensington was bought by Investec in 2007 right at the outbreak of the subprime mortgage crisis in the US, which eventually sparked the global financial crunch in 2008 and beyond.

The continued underperformance of Kensington made Investec the only South African bank to be directly exposed to the global subprime mortgage crisis at the time.

In November 2007, Investec said it had to write down £36 million (about R500m at the time) of US structured-credit investments in the interim period to September that year.

Stephen Koseff, the CEO of Investec, once told Ventures Africa at a lunch in Sandton, Johannesburg that Kensington had been turned around.

But Thursday’s announcement clearly shows that the turnaround did not last long.

Investec, which said it had been approached by a couple of potential buyers for Kensington, has already appointed Fenchurch Advisory to advise it on this transaction.

Investec said it could not say for sure that the sale will go ahead, promising to make an announcement soon.

Tracy Brodziak, a financial services analyst at the Cape Town-based Old Mutual Equities, told Moneyweb that the sale of Kensington would be great for Investec as the unit had failed to perform well for a while.

 

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