NMB Bank, one of the largest lenders in the country, recorded a 76-per cent increase in pre-tax profit for year ending this September, thanks to tremendous market confidence in the bank.
The bank, listed on Dar es Salaam Stock Exchange (DSE), recorded a profit before tax jump from 118bn/- in last year’s quarter three (Q3) to 208bn/- of similar period this year.
NMB Chief Executive Officer Ruth Zaipuna said the growth was a result of rapid economic growth in the country as witnessed by the declaration of the country’s middle-income status in July.
“The strong financial performance [so far] is an encouraging indicator of the effectiveness of our strategy, the quality of our people and the tremendous market confidence in the bank,” Ms Zaipuna said yesterday in a statement.
The sustained GDP growth rate over the recent past has also boosted the performance of the banking sector in the country, with NMB Bank being one of the beneficiaries. A favourable business operating landscape, coupled with successful implementation of the lender’s strategic initiatives is also another factor.
During the quarter profit after tax increased by 77 year on year (y-o-y) per cent from 82bn/- in Q3 2019 to 145bn/-.
Additionally, during this period NMB Bank’s strategy to grow its strategic income streams was further re-affirmed with the growth of operating income of 14 per cent from 527bn/- in Q3 in 2019 to 600bn/- in this year in Q3.
The bank’s efficiency programme and disciplined cost management efforts are also trending well, leading to an improved cost to income ratio of 52 per cent.
Further, confirming the bank’s growing reputation as an economic development financier, NMB Bank’s total assets grew by 15 per cent to 7.0tri/- up from 6.1tri/- in a similar period last year. On the other hand, bank deposits dropped slightly to 5.2tri/- from 5.4tri/-.
The lender managed to improve the quality of loan book leading to a reduction in loan impairment charges by 22 per cent y-o-y while non-performing loans grew down to 6.6 per cent from 7.0 per cent.
According to financials, NMB Bank strengthened its capital base within both internal and regulatory limits, which is central to sustained business growth in the many years to come.
The bank’s core capital as a proportion of its total risk weighted assets continues to be above the bank of Tanzania statutory minimum of 12.5 per cent.
Last week, NMB Bank was recognised the Safest Bank in Tanzania for 2020 by Global Finance. The accolade comes a few months after Euromoney, a leading global financial markets magazine based in London, named NMB Bank the best bank in Tanzania for the eighth consecutive year.