DAR ES SALAAM: TANZANIA Agricultural Development Bank (TADB) saw its net profit rise by 49 percent in the second quarter ending June, driven by increased loans in the fishing sector.
The bank’s financial statement released yesterday showed net profit increased to 4.95bn/- in three months to June from 3.32bn/- in a comparative quarter last year.
The TADB’s Managing Director, Mr Frank Nyabundege, said the lender’s loan portfolio was boosted by the government’s support, allowing it to reach more sectors in fishery, livestock and agrirelated activities.
“Government financial support has enabled us to reach out to more fishermen, facilitating their businesses and helping them flourish,” said Mr Nyabundege.
Through its smallholder credit guarantee scheme, the farmer’s bank has been able to provide loans to 23,659 smallholder farmers, breeders and fishermen.
The farmer’s bank, with more than 753bn/- of assets until June, its motive to support the SMEs enabled to register some strides during the period.
The report showed the lender’s increased loans to the smallholders resulted to growth in bank’s interest income.
Net interest income, the report showed, has increased by 42.1 per cent to 11.8bn/- in Q2 up from 8.31bn/- posted in a similar period in the previous year.
The increase in interest income has been attributed by the increased the robust bank’s loan portfolio in the quarter that increased by 38.2 per cent until the end of June.
Until the end of June, the pro-farmer’s bank managed to issue loans worth 466.6bn/- from 337bn/ registered in Q1 ended in March this year.
However, the render’s non-interest income slightly went down by 30.7 per cent to 1.48bn/- until the end of June from 2.14bn/- posted in a similar period of the prior year.
The decrease was attributed to the reduction in the foreign currency dealings and translation gains and fees and commissions.
The lender’s foreign currency dealings and translation gains decreased by 26 per cent to 111m/- from 150m/- posted last year while the bank’s fees and commissions slightly went down to 978m/- until the end of June from 1.14bn/- recorded in the same period last year.
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TADB’s non-performing loans (NPLs) significantly increased to 16.5bn/- in three months to June from 13.5bn/- posted at the end of March.
Despite the increase, the NPLs ratio until the end of June stands at 3.0 per cent, down compared to the Bank of Tanzania’s threshold of 5.0 per cent.
Furthermore, the lender’s operating expenses have increased to 6.53bn/- in Q2 from 5.24bn/- posted in a similar period of the previous year, pushed up by increased salaries and benefits.
According to the statement, salaries and benefits increased by 2.3 per cent to 2.76bn/- from 2.70bn/- posted in a similar period last year.
The increment is highly pushed by the increased number of staff to 126 at the end of last month from 111 in a similar period in a previous year.
Despite the increase of staff, the bank has maintained the number of operating branches. The lender has seven zone offices.