loader
Picha

DCB plans for municipal bonds underway

DAR ES SALAAM Commercial Bank Plc (DCB), has initiated process to introduce municipal bonds that will help municipals and district councils raise funds for strategic projects.

Speaking recently in Mwanza DCB Managing Director, Godfrey Ndalahwa said the plan would help finance strategic projects and the bank has begun negotiations with municipalities and other key stakeholders.

“ The process of establishing this service is ongoing. We aim to add more municipalities that have this kind of strategic projects. This is a good source of raising funds for large and small investors get the opportunity to invest in municipal projects,” he said.

He said bank’s sponsorship of the recently held Annual General Meeting of the Association of Local Authorities of Tanzania (ALAT), in Mwanza saying was based on the bank’s intention to serve the public and small business owners especially women and young people.

“ We have been working very closely with the municipalities and all Dar es Salaam councils in providing loans to women and youth and the success is great so far when you look at the money that has come out and the beneficiaries have benefited three times and this is because of the expertise and experience we have,” he said.

The Dar es Salaam Stock Exchange (DSE), listed bank is expecting to boost its capital by 57 per cent to 26.7bn/- up from 16.9bn/-after oversubscription of shares in a rights issue launched in November last year.

It tapped its shareholders and new investors to raise 8.9 bn/-through the rights issue but the results exceeded their expectation underlining a vote of confidence by shareholders and new investors on the bank’s long-term growth strategy.

The bank was expecting to raise 9.6bn/-up from 8.9 bn/-target after managing to sell 36.6 million additional shares surpassing the target of selling 33.9 million shares, equivalent to 108 per cent.

DCB Bank made 1.6bn/- profit in the 2018 financial year up from 6.9bn/-loss in 2017 thanks to a turnaround strategy adopted to return to profitability.

The performance is a result of cost cutting measures that saw reduction in operating costs and enhancement of efficiency through digital service, controlling of non-performing loans and improvement in branch network.

DCB had set up a fiveyear strategic plan to maintain profitability which was being implemented in three phases.

The first phase which covered January to June last year was mainly a turnaround phase focused on operational changes which helped to cut operating costs.

The bank managed to reduce operating costs and the proportion of revenue and expenditure from 104 per cent in 2017 to 81 per cent in 2018. As part of the strategy, non-performing loans were set to drop to a single digit by the end of 2019 .

The second phase is transformation and consolidation where the bank was focused to deliver a profit before tax of 1.8bn/-by the end of December 2018.

According to Managing Director that will be achieved while proactively managing all key risks to ensure the bank is more resilient and strong enough to absorb volatile business environment, whilst ensuring compliance with minimum regulatory requirements.

The bank operates across the country with eight branches in Dar es Salaam and Dodoma and more than 1,000 agents.

TANZANIA and Zambia Railway Authority ...

foto
Author: DAILY NEWS Reporter

Recent Posts

Categories

more headlines in our related posts

latest # news