NMB nears trillion-shilling profit milestone

DAR ES SALAAM: NMB Bank has reached a significant milestone in its financial performance, posting a record profit before tax of 931bn/- in 2024, bringing it close to the coveted trillions hilling mark.

This represents a remarkable 20 per cent increase compared to the 775bn/- reported in 2023, showing the bank’s continued growth and solid financial health.

The strong profit growth and a return on equity of 28 per cent, the bank has demonstrated its ability to generate substantial returns for its shareholders, positioning itself as a key player in the country’s banking sector.

NMB CEO Ms Ruth Zaipuna  said over the weekend that last year was a year of exceptional financial and operational achievements for the bank, underscoring its strategic growth and commitment to supporting the country’s economic development.

“Our results reflect the strength of our business model, the dedication of our people and the trust of our customers. As we look ahead, we remain focused on driving innovation, expanding financial inclusion and delivering sustainable value to all our stakeholders,” she said.

According to the statement issued by the bank over the weekend, total revenue rose by 16 per cent to 1.6tri/-, supported by the growth of net interest income and non-funded income by 13 per cent and 23 per cent, respectively.

Furthermore, the cost-toincome ratio improved by 100 basis points year-on-year to 38 per cent in last year, well below the regulatory maximum limit of 55 per cent.

“This improvement was driven by streamlined operations, disciplined cost management and strategic investments in people and digital technology, positioning the bank to sustain growth and deliver val- ue across its core businesses.

“These efforts underscore the bank’s ability to balance efficiency with innovation, ensuring a solid foundation for future success,” said the report.

The bank’s balance sheet continued to grow, with total assets increasing by 13 per cent year-on-year to 13.7tri/- driven by solid growth in both loans and advances and customer deposits.

The bank’s statement showed net loans and advances to customers grew by 10 per cent to 8.5tri/- and customer deposits recorded broad-based growth, rising by 13 per cent to 9.5tri/-.

Additionally, the bank maintained strong credit portfolio quality, with the nonperforming loans (NPL) ratio improving to 2.9 per cent last year compared to 3.2 per cent recorded in 2023.

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This reflects strong credit origination and a robust credit monitoring process. Moreover, NMB remains well-capitalised, underpinned by strong earnings growth and efficient capital deployment, contributing to a well-capitalised status.

“As of end of December, the capital adequacy ratio stood at 23 per cent, well above the regulatory minimum requirement. This solid capital position supports future investments, lending growth and long-term stability,” the bank said.

The successful execution of NMB’s strategy has delivered record-breaking results and enabled the achievement of significant milestones.

NMB’s consistent financial performance has also earned it a place among SubSaharan Africa’s 30 most valuable companies excluding South Africa, according to Capital Market Union CMU, Sub-Sahara Africa Top 30 Companies Report 2024.

The statement said also that NMB solidifies its position as market leader, commanding roughly a quarter of the market share in both loans and customer deposits.

By end of last year, the bank on boarded 1.5 million new customers, propelling its total customer base to over 8.6 million.

Furthermore, NMB invested over 5.4bn/- in education, health and climate-related initiatives, underscoring its dedication to driving positive social and environmental impact.

The statement said the lender will continue to invest in technology, talent and customer-centric solutions to drive financial inclusion and support the country’s economic development.