NMB Bank exploring opportunities in the low LSM

Published: 30 August 2013

NMB Bank Chief Executive James Mushore told an analyst briefing yesterday that his bank is going to explore growth opportunities in other market segments saying the journey might lead them to opportunities for broadening their catchment area.

Mushore said NMB Bank will continue to focus on reducing the non-performing loans (NPLs) which are currently at 22.8% of loan book.

"We need to focus on NPLs which have increased from what we reported last time.

"We are always very candid and honest about our NPLs figures.... But I think the stagnant economy and liquidity challenges adversely affected borrowers' ability to service loan obligations," he said.

Mushore added that they have intensified their corporate restructuring and recovery policy on the NPLs. The firm is targeting a reduction in NPLs to below 20% by 31 December 2013.

He further noted that they are going to explore growth opportunities in other market segments saying the journey might lead them to opportunities for broadening their catchment area.

Giving the financial highlights for the six months ended 30 June 2013, Chief Financial Officer Benson Ndachena said attributable profit went up 4% to $2.672 million while basic earnings per share also increased by 4% to 0.95c.

The total deposits improved by 10% to $210.67 million while total equity posted an increase of 55% to $47.95million.

Commenting on the developments the bank has made, Mushore indicated that total credit lines secured to date amounts to $57.4 million and "credit lines continue to be a challenge."

He stated that the bank connected to the EcoCash platform in June 2013 and it is proving to be an additional revenue stream for the bank.

Mushore also highlighted that the bank attained new capital of $14.8 million raised from 3 strategic foreign investors.

Mushore told the meeting that the group will launch mobile banking in September 2013 while upgraded internet banking will be re-launched in December 2013.

The group will launch the Customer Relationship Management (CRM) in the first quarter of 2014 and the chip and pin cards in September 2013.

Mushore said that before the election date was announced the firm took a step to increase the liquidity ratio to 40% (against the RBZ minimum of 30%) to be ready to meet any demand from clients.

Commenting on the new minimum capital requirements he said they await the Monetary Policy Statement for the revised capital levels and their plans are to ensure compliance with the new capital requirements.

Going forward in terms of assets, Mushore said growth in assets will continue to come from credit lines and growth in deposits.

"The policies of the new government will determine accessibility of credit lines and growth in market deposits," he said.

- zfn