CRDB proposes highest ever dividend of 50/-

DAR ES SALAAM: CRDB Bank has announced a dividend of 50/- a share, the highest since it was established.

The dividend rate came after the CRDB bank’s impressive financial results for the year ending last December, demonstrating a remarkable 21 per cent growth in profit after tax.

CRDB, the largest bank in terms of balance sheet, saw its net profit surging from 351bn/- in 2022 to 423bn/- last year.

The proposed 50/- dividends per share to shareholders for 2023, bring the total dividend to 131bn/-, representing a growth of 11 per cent year on year.

However, according to the bank’s statement issued yesterday, the proposed dividend is subject to regulatory approval.

The Bank’s Group CEO and Managing Director, Mr Abdulmajid Nsekela, attributed the robust performance to the successful execution of its strategic focus on sustainable growth and the development of a resilient business model capable of navigating regional and international challenges.

“We are pleased to announce another year of significant growth, solidifying our position as a key player in the financial sector in the region. The impressive financial results reflect our commitment to delivering value to our stakeholders,” Mr Nsekela said in a statement.

The Bank’s stellar performance was primarily contributed by growth in both funded income and non-funded income.

Funded income (interest income) grew by 29 per cent in line with loan portfolio growth. Net interest margin however grew at 19 per cent, suppressed by the growth in interest expenses by 58 per cent on account of rising interest rates at both domestic and international markets.

On the other hand, the Group continued to record impressive growth in non-funded incomes (fees and commissions incomes) that saw an impressive 11 per cent year-on-year growth on account of increased usage of digital channels.

This translated to the strengthening of earnings per share by 20 per cent to 161/90. According to the CRDB’s audited financial results for 2023 released late last week, the bank also reported substantial growth in key performance indicators.

Total assets saw a notable 14 per cent increase from 11.6tri/- to 13.3tri/- .

Furthermore, loans and advances and customer deposits also recorded substantial growth at 23 per cent and 8.0 per cent, reaching 8.5tri/- and 8.9tri/-, respectively.

The Bank’s total equity stood at an impressive 1.8tri/-. The CRDB head emphasised that the seamless execution of the first year of the bank’s new medium-term strategy (2023 – 2027) has been a key catalyst for achieving record-breaking performance.

“The meticulous execution of our strategic initiatives has propelled this exceptional growth,” he said.

The Group’s efforts to deepen its roots in the retail segment have witnessed a remarkable 35 per cent expansion in loans to Micro, Small and Medium Entrepreneurs (MSMEs) and notable advancements in inclusive financing across diverse sectors and segments such as youths, women, agriculture and sustainability financing.

“This has resulted in significant customer acquisitions and a remarkable increase in the volume of transactions across various electronic platforms,” Mr Nsekela said.

The growth in transactions on its digital channels continues to support the lender retail push as fees from digital products increased by 11 per cent over 2022, with retail deposit balances also growing by 23 per cent.

“Our commitment to pioneering solutions that positively impact lives especially those who are at the bottom of the pyramid bolstered our overall financial performance,” added Mr Nsekela, noting that the introduction of CRDB Bank Foundation also shows its commitment to community engagement and financial inclusion beyond banking services.

Fredrick Nshekanabo, CRDB Group’s Chief Financial Officer (CFO) emphasised the bank’s robust financial position. He noted that the bank’s emphasis on a high-quality loan portfolio is reflected in its low Non-Performing Loans, holding steady at 2.8 per cent.

Additionally, the bank has successfully maintained a Cost to Income ratio of 49.5 per cent, underscoring its dedication to prudent risk management and ongoing profitability.

Looking ahead, Mr Nshekanabo said CRDB Group is well-positioned for the future, and it remains committed to delivering value to customers, shareholders and the communities it serves.

In 2023, CRDB Bank significantly broadened its horizons by expanding its reach into the Democratic Republic of Congo (DRC) market and venturing into the insurance sector with the establishment of CRDB Insurance Company.

These strategic moves further strengthen the bank’s foothold not only in Tanzania but also across the broader East and Central Africa region.

The Group’s focus on sustainable growth and financial prudence will continue to guide the bank’s strategic decisions in the coming years.

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