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Frozen $500 mln in Angolan fraud probe came from central bank account with Standard Chartered

Comments (0) Actualites, Africa

LUANDA/LONDON (Reuters) – The $500 million at the centre of an alleged fraud involving the son of Angola’s former president was transferred out of a Standard Chartered account held by Angola’s central bank, the British bank told Reuters on Wednesday.

The Angolan prosecutor general’s office said on Monday it had charged Jose Filomeno dos Santos, the former president’s son, and Valter Filipe da Silva, the former governor of the central bank known as Banco Nacional de Angola, with fraud over the case.

Britain’s National Crime Agency said last week that $500 million had been frozen in the UK as part of an investigation into a potential fraud against Angola’s central bank and could be returned to the southern African country.

“We are aware that our client, Banco Nacional de Angola (BNA), was the victim of an attempted fraud in Angola which involved the transfer of funds from their Standard Chartered Bank account,” Standard Chartered said in an emailed response to questions.

The bank did not respond to a question on how the transaction appeared to bypass security mechanisms.

The Angolan central bank, which has so far made no public statement about the case, did not immediately respond to a request for comment.

Dos Santos is the highest profile figure charged since President Joao Lourenco succeeded longtime leader Jose Eduardo dos Santos last September pledging to tackle an endemic culture of corruption in the oil-producing country.

Reuters was unable to immediately contact Jose Filomeno dos Santos. He said in a statement circulated in Angolan media on Tuesday that he was cooperating with the investigation and had handed his passports in to the prosecutor general’s office.

Reuters has also been unable to reach Da Silva for comment.

Standard Chartered said it is closely cooperating with Angola’s central bank and British law enforcement.

A source familiar with the matter told Reuters on Wednesday that HSBC had frozen a bank account in connection with the alleged fraud.

The Financial Times, which reported the HSBC bank freeze earlier, said documents purporting to be from Swiss bank Credit Suisse were also used in the fraud.

The documents were fake and Credit Suisse was not involved in the transaction, a source familiar with the matter told Reuters.

Britain’s National Crime Agency said the funds were frozen after the transaction raised suspicions, without naming the banks involved.

Standard Chartered, which has operations across Asia and Africa, ended its dollar-clearing operations with commercial banks in Angola in Dec. 2015 because it deemed it too risky.

Singapore said last week its central bank had imposed penalties of nearly $5 million on Standard Chartered Bank and Standard Chartered Trust (Singapore) for breaching money laundering rules and terrorism financing safeguards.

HSBC’s move to freeze the accounts and work with authorities to return the funds will reinforce the lender’s assertion that its efforts to improve financial controls are bearing fruit.

The bank paid $1.9 billion in fines to U.S. authorities in 2012 and agreed to install an independent monitor to improve its anti-money laundering controls, after it was used to launder Mexican cartel drug money.

A five-year period in which the bank faced criminal prosecution if it breached U.S. compliance rules again ended in December.


(Reporting by Stephen Eisenhammer in Luanda and Lawrence White in London; Editing by Adrian Croft)

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Angola oil production declines slightly in 2017, profits rise

Comments (0) Actualites, Africa, Business, Economy, Oil

LUANDA (Reuters) – Oil production for Angola, Africa’s No. 2 crude producer, averaged 1.632 million barrels per day in 2017, down from 1.72 million barrels the previous year, the chairman of the state-run oil company Sonangol said on Wednesday.

Angola has been grappling with the effects of generally depressed oil prices on its government finances but is constrained from lifting production because it is committed to OPEC-mandated cuts.

Angola is a member of the Organization of the Petroleum Exporting Countries, and it must limit output in line with OPEC’s commitment to cut output by about 1.2 million barrels per day (bpd) as part of a deal with Russia and others.

Sonagol chairman Carlos Saturnino also told a media briefing that the net profit for Sonangol, which regulates Angola’s oil sector, was $224 million in 2017 versus $81 million the previous year when oil prices were lower.

It was his first briefing since Angola President João Lourenço fired Isabel dos Santos, daughter of his presidential predecessor, from the helm of Sonangol.

Lourenço took power in September and is seeking to win credibility with international investors and shed Angola’s image as an opaque oil economy with rampant corruption.


(Reporting by Stephen Eisenhammer; Writing by Ed Stoddard; Editing by James Macharia)

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Angola’s inflation slows to 32.58 percent year/year in May

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LUANDA (Reuters) – Angola’s inflation slowed to 32.58 percent year-on-year in May from 34.8 percent in April, according to data on the national statistics agency’s website seen by Reuters on Monday.

Price increases on a month-on-month basis slowed 1.6 percent in May compared to a 1.8 percent previously.


(Writing by Olivia Kumwenda-Mtambo; Editing by James Macharia)


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Caixabank bid for Banco BPI hits new snag as vote on rights cap delayed

Comments (0) Africa, Business, Latest Updates from Reuters

PORTO, Portugal (Reuters) – A meeting of shareholders in Portugal’s Banco BPI, that started on Friday and was expected to lift a 20 percent limit on voting rights, was suspended until September due to a legal injunction, in a new snag for a takeover bid by Spain’s Caixabank.

The bid is opposed by the bank’s No. 2 shareholder, Angolan investor Isabel dos Santos, the daughter of Angola’s president. Caixabank has said its bid hinges on the scrapping of the voting rights limit, which has so far allowed dos Santos to fend off its attempts to control the country’s third-largest lender.

Chairman of the BPI board Artur Santos Silva said the injunction blocked the vote due to a minor procedural issue, which Santos Silva expected to be resolved by Tuesday.

He said Caixabank had then proposed to postpone the meeting for 45 days, which shareholders approved. Portugal’s market regulator CMVM had suspended trading in BPI shares on Friday awaiting the result of the vote.

“I am very sorry about this situation … which is hard to understand,” he said, adding the injunction was based on the fact that the minutes of the board meeting that set Friday’s vote had lacked a formal seal of approval. “On Tuesday this problem will disappear,” he said.

He did not name the shareholder who launched the injunction, but shareholders at the meeting said Portuguese shareholder Violas Ferreira, who has a 2.7 percent stake in BPI, had presented it.

Thanks to a government decree in April aimed at putting an end to voting right limits in the banking sector, Caixabank would have voted with its full 45 percent stake in BPI to lift the cap. The motion requires a two-thirds majority to pass.

In April, Caixabank launched a takeover bid for the lender, offering 1.113 euros per share, less than its initial offer of 1.329 euros, which dos Santos fended off last year.

Dos Santos has already said the price is too low and wants an independent auditor to fix a minimum price for BPI shares, above the current offer. She has also accused the government of making an “unprecedented and clearly partial” decision in changing the law on rights limits.

But BPI’s board has called the new offer “opportune and friendly”, if low. It said an eventual takeover should help resolve the problem of BPI’s excessive exposure to risky Angolan assets and better prepare the lender to meet growing capital requirements from regulators.

BPI, which draws most of its profit from Angola, has been affected by a change in European rules that classify all exposure to the African country as risky and to be fully provisioned for, significantly reducing BPI’s solvency ratios. It has to cut the exposure and comply soon or pay hefty fines.


(Reporting By Sergio Goncalves, writing by Andrei Khalip, editing by Axel Bugge and Susan Thomas)

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Angola halves growth forecast, cuts spending as oil price bites

Comments (0) Africa, Business, Latest Updates from Reuters

LUANDA (Reuters) – Angola has halved its 2016 economic growth forecast and slashed government spending as lower oil prices hammer state revenues in Africa’s largest crude exporter, the finance ministry said on Monday.

Sub-Saharan Africa’s third-largest economy will grow 1.3 percent this year, compared with a previous forecast of 3.3 percent, the finance ministry said in a statement.

Government spending will be cut to $24 billion from $30 billion projected in the original 2016 budget as revenues were also slashed to $18 billion from $24.4 billion.

The statement, a rare disclosure by one of Africa’s most secretive states, said Luanda had borrowed $11.46 billion between November 2015 and June 2016, including $5 billion from the China Development Bank and $2 billion from other state-backed Chinese lenders.

Total government debt stood at $47.9 billion, including $25.5 billion in external loans, it added, although this figure does not include debt held by state-owned companies such as domestic oil firm Sonangol.

Cuts to public services have already had a major impact on the former Portuguese colony, with piles of uncollected rubbish lying rotting in the streets of the capital, in the shadow of half-finished concrete office blocks and shopping complexes.

Health experts say the spending reductions are partly to blame for a yellow fever outbreak that started in one of Luanda’s vast slums in December and which has spread throughout the country and as far afield as China.

The finance ministry confirmed it had ended emergency financing talks with the International Monetary Fund (IMF) because it had achieved “great fiscal equilibrium”.

However, it said it was still committed to a structural overhaul of an economy that remains perilously reliant on oil.

The finance ministry has cut its budgetary oil price assumption to $41 a barrel, from $45 previously. Crude oil output remains steady at 1.77 million barrels per day, it said.


(Writing by Joe Brock; Editing by Ed Cropley)

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Angola’s Sonangol halts all asset sale talks

Comments (0) Africa, Business, Latest Updates from Reuters

JOHANNESBURG (Reuters) – New Sonangol chief executive Isabel dos Santos has suspended all talks relating to the sale of assets belonging to the Angolan state oil firm and stripped its internal legal department of most of its powers, a statement said.

Dos Santos, the billionaire daughter of President Jose Eduardo dos Santos, was appointed to the Sonangol helm last month with orders to improve the efficiency of the sprawling 40-year-old firm, the central pillar of Angola’s economy.

The statement posted on Sonangol’s website after a board meeting at the end of last month said “all processes of evaluation, negotiation and sale of any assets” had been suspended with immediate effect.

It gave no further details.

Separately, it said the board had removed the legal department’s mandate to handle anything other than disciplinary matters. Again, the statement provided no more clarity.

Isabel dos Santos told Reuters last month she planned to hive off Sonangol’s non-core assets, such as its banking, real estate and airline interests, into separate holding companies to bring the company’s focus back exclusively to oil.

Boston Consulting Group and PriceWaterhouseCoopers have been hired as external advisers to the shake-up, which has won approval from the foreign oil firms operating in Africa’s top crude producer.

Isabel dos Santos also said she intended to improve transparency at Sonangol, long been regarded as one of the most opaque institutions in Africa.

In 2011, Sonangol was accused of misplacing $32 billion in oil revenues owed to the government.

The International Monetary Fund later said it had managed to track down the missing cash, attributing the accounting discrepancy to “quasi-fiscal operations” conducted on behalf of the government.


(Reporting by Ed Cropley and Herculano Coroado; Editing by James Macharia)

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IMF says Angola needs fiscal prudence in run-up to 2017 elections

Comments (0) Africa, Business, Latest Updates from Reuters

LUANDA (Reuters) – Angola needs to maintain fiscal prudence in the run-up to the 2017 elections, an International Monetary Fund (IMF) team said on Tuesday after a two-week visit to the oil producing country.

Angola’s economy grew fast after a 27-year civil war ended in 2002, peaking at growth of 12 percent three years ago, but a sharp drop in oil prices has sapped dollar inflows, dented the kwanza and prompted heavy government borrowing.

Oil output represents 40 percent of Angola’s gross domestic product and more than 95 percent of foreign exchange revenue in sub-Saharan Africa’s third biggest economy.

The IMF team said the outlook for 2016 remained difficult, despite the increase of oil prices in recent weeks.

The global lender also warned that economic activity will likely decelerate further, adding that a modest recovery could be expected in 2017 if shortages of dollars are tackled.

“The significant fiscal effort carried out last year was a very important step to assuage fiscal and public debt sustainability concerns,” Ricardo Velloso, who led the team, said in a statement.

“However, further steps are still needed to reduce vulnerabilities, and maintaining fiscal prudence in the run-up to the 2017 elections will be critical.”

The IMF team arrived in Angola on June 1 to discuss options on how to diversify the economy and reduce the dependence on the oil sector, Angolan authorities have said.


(Writing by Nqobile Dludla; Editing by James Macharia)

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IMF team in Angola for loan talks, economy diversification on agenda

Comments (0) Africa, Business, Latest Updates from Reuters

LUANDA (Reuters) – A team from the International Monetary Fund is visiting Angola to negotiate a loan facility after lower oil prices hammered the finances of Africa’s second largest crude exporter, the Ministry of Finance said on Wednesday.

The ministry said the IMF team will be in Angola from June 1 to June 14 and would discuss options on how to diversify the economy and reduce the dependence on the oil sector.

“The initial negotiations focused on recent economic developments, fiscal, monetary and exchange rate policy in the country, as well as the evaluation of the reforms that the government has been implementing,” the ministry said in a statement.

Angola said in April that it would begin loan negotiations with the IMF on a three-year loan facility.

Angola’s economy grew rapidly after a 27-year civil war ended in 2002, peaking at growth of 12 percent three years ago, but a sharp drop in oil prices has sapped dollar inflows, dented the kwanza and prompted heavy government borrowing.

Oil output represents 40 percent of Angola’s gross domestic product and more than 95 percent of foreign exchange revenue.


(Reporting by Herculano Coroado; Writing by Olivia Kumwenda-Mtambo; Editing by Alison Williams)

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African governments seek bailouts as commodity prices fall

Comments (0) Africa, Featured, Politics

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Angola is the latest nation to seek an aid package from the International Monetary Fund as its oil-dominated economy falters.

As its economy buckles under the weight of falling oil prices, Angola is turning to the International Monetary Fund (IMF) for a bailout.

By one estimate, the West African nation faces a shortfall of $8 billion, or 9 percent of its gross domestic product, this year. Angola last borrowed from the IMF in 2009.

Angola is one of several cash-strapped African countries that are turning to the IMF for financial help as prices drop for commodities such as oil and minerals.

Ghana agreed to an aid package in 2015, it’s first from the IMF in six years. Zambia is also in talks for IMF aid, which would be its first since 2008. Zimbabwe has also asked the IMF for its first loan in nearly two decades.

Meanwhile, the IMF stopped a $55 million loan to Mozambique – part of a bailout approved last year – after discovering the country had failed to report $1 billion in unreported loans it owes.

South Africa and Nigeria may also be forced to turn to the IMF as their economies struggle.

Angola faces shortfall

Angola’s request was an about-face after the nation repeatedly said it would not turn to the IMF for help in the current crisis because the aid would come with too many conditions.

But the country’s reserves have fallen as oil prices stayed below $45 a barrel and the government is reluctant to cut services in advance of elections in 2017.

Oil accounts for 95 percent of Angola’s exports and about half of the government’s revenue. In addition to slumping oil revenues, the country has suffered a retrenchment by China, which has its own economic problems.

Monetary agency requires transparency

In exchange for IMF aid, the Angolan government is likely to be forced to be more transparent about its financial dealings as the international agency typically scrutinizes the finances of countries it assists.

One criticism of Angola’s economy is the extent to which it is controlled by President José Eduardo dos Santos, who has ruled the country for more than three decades. While nearly half of the country’s population subsists on just over $1 per day, dos Santos’ daughter, Isabel dos Santos, is the richest woman in Africa, raising questions about the source of her wealth. Isabel dos Santos has denied using state money to enrich herself.

“The IMF stands ready to help Angola address the economic challenges it is currently facing by supporting a comprehensive policy package to accelerate the diversification of the economy, while safeguarding macroeconomic and financial stability,” Min Zhu, IMF deputy managing director, said in a statement.

One expert urged caution. Ricardo Soares de Oliveira, an Angola expert at Oxford University, noted that a study in 2011 by IMF staff found that the government could not account for $32 billion between 2007 and 2010.

“The IMF should use the leverage it has to extract serious concessions and tangible reforms from the government,” de Oliveira said.

Ghana receives bailout

Angola is the not the only country turning the IMF.

Ghana, an oil and gold producer, received a three-year, $918 million bailout in 2015. The country saw the value of its crude exports cut in half between 2014 and 2015, falling to $1.5 million in the first three quarters of last year as both prices and demand fell. Gold exports fell by nearly one third to $2.4 million.

In December, the IMF also agreed to a $283 bailout loan package for Mozambique that required the southern African nation to disclose all of its borrowing. In April, the IMF said it stopped a disbursement of $55 million after learning the country had not reported millions in loans by Credit Suisse Group and the Russian VTB Group.

Mozambique, a natural gas producer, saw exports fall by 14 percent in 2015.

Zambia, Africa’s second largest copper producer, saw a shortfall of 8 percent of gross domestic product in 2015 and is also seeking IMF assistance in 2016. Zimbabwe also expects an IMF loan in the third quarter of this year.

In addition to the IMF aid, the World Bank said it expects to lend up to $25 billion this year to countries reeling from falling commodity prices.

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Angola president continues central bank shakeup, replaces deputy governors

Comments (0) Africa, Latest Updates from Reuters, Politics

LUANDA (Reuters) – Angolan President Jose Eduardo dos Santos replaced two deputy central bank governors on Wednesday, his office said in a statement, the latest round of shake-ups at the bank as the oil-rich African country seeks assistance from the IMF.

Dos Santos in March appointed little-known Valter Filipe da Silva as Angola’s new central bank governor after José Pedro de Morais resigned.

His office said Gualberto Manuel Amaro Lima Campos and Cristina Florencia Dias Van-Dúnem had been dismissed and replaced by António Manuel Tiago Dias and Suzana Maria de Fátima Monteiro Camacho.

The economy of Angola, Africa’s second-largest oil exporter after Nigeria, has been hammered by the oil price fall, and the government is in talks with the World Bank and International Monetary Fund about possible financial assistance.

Three directors of the bank’s board were also dismissed and replaced.


(Reporting by Herculano Coroado; Editing by Ed Stoddard and Dominic Evans)

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