👨🏿‍🚀TechCabal Daily – Access Bank records FX gains

On Friday, Kenya’s Court of Appeal upheld a ruling by a labour court filed in April 2023. The ruling meant Meta could face trial over the mass layoff of content moderators in the country.

About 185 ex-content moderators filed a lawsuit against Sama, a third-party company hired by Meta to moderate Facebook content. These workers, who had the challenging task of filtering out hours of disturbing material from social media, sued Sama for poor working conditions and unjust layoffs. 

A case in 2022, filed by ex-Sama worker Daniel Motaung, sued Sama for being wrongfully dismissed for trying to form a union to lobby the company for better pay. Motaung’s case was previously dismissed for lack of jurisdiction. Meta had also argued that it was not a direct employer and couldn’t be sued in Kenya. 

However, the new ruling by the Court of Appeal lumps the two cases and rules that both Meta and Sama could be responsible for paying $1.6 billion in compensation to these ex-workers.

Mercy Mutemi, a representative counsel for the ex-Sama workers said of the ruling, “Meta being sued in Kenya is a wake-up call for all Big Tech companies to pay attention to the human rights violations taking place along their value chains.”

To rein in inflation, the central bank’s Monetary Policy Committee has raised interest rates four times since the start of the year. The MPC raised interest rates to 26.75% in July.

 Inflation slowed for the second consecutive month in August with 32.2%, down from 33.4% recorded in July. The decreasing impact of the currency devaluation, the temporary removal of fuel subsidies, and a drop in food prices driven by the harvest season played a role in the inflation slowdown. 

Although analysts anticipate a potential pause in interest rate hikes, the central bank will likely remain cautious and assess inflationary pressures through November, considering the recent fuel price increase, before determining whether to ease or maintain its monetary tightening stance.

The MPC will also make other decisions around short-term interbank interest rates. In July, it widened its asymmetric corridor, allowing commercial banks to borrow from the CBN at 31.75% (up from 27.25%) and deposit at 25.75% (up from 23.25%).

Access Holding, the parent company of Nigeria’s largest bank by customer base, has posted its second-quarter financial statement. 

The company reported a pre-tax profit of ₦348.9 billion ($218.1 million) for the first half, driven by a surge in interest income from loans and investments. Access Bank earned about ₦646.34 billion ($404.0 million), aided by ₦412.8 billion ($258.0 million) unrealised foreign currency translation gain. 

The bank’s personnel expenses surged to ₦415.8 billion ($260.0 million) from ₦65.1 billion ($40.8 million). This may have been driven partly by a surge in hiring due to the Access Bank’s recent expansion. In June, Access Bank  acquired ABCT Bank in Tanzania to deepen its East African presence. Access Bank’s staff headcount increased from 7,567 to 8,009. The number of high-earning employees—staff earning ₦14.9 million ($9,312) monthly and above—increased by 689 in just six months.

Aside from Access Bank South Africa and Kenya, all other foreign subsidiaries reported pre-tax profits. Access Bank South Africa and Kenya posted pre-tax losses of ₦10.6 billion ($6.5 million) collectively. 

Hydrogen Payment Services, Access Holdings’ FinTech subsidiary, reported a pre-tax profit of ₦238 million ($148,750). Access Pension and ARM Pension, its newly acquired PFA, were both profitable, reporting revenue of ₦15.1 billion ($9.4375 million).