View Full Version : Habari za biashara /Financials news
July 27th, 2011, 09:02 AM
This thread is meant to highlight how the Tanzanian market is performing e.g. inflation news, recent acquisitions and mega financial transactions that are happening in Tanzania and across the border including the IPOs news in the region and at our stock exchange primarily!
July 27th, 2011, 09:15 AM
20th July 11
ABG crosslisting on Dar bourse close to completion
The Dar es Salaam Stock Exchange has said African Barrick Gold (ABG), part of Barrick Gold Group, has started the process of crosslisting its shares on the bourse.
DSE chief executive officer, Gabriel Kitua, said in an exclusive interview in Dar es Salaam that the development will see the number of crosslisted players rise to six.
Other crosslisted firms are Kenya Airways, East African Breweries, Jubilee Holdings, Kenya Commercial Bank, and the Nation Media Group.
“We have received application documents from ABG, they have completed some of the required procedures for crisslisting,” he said.
He said the DSE has processed the documents and advised the applicants accordingly.
“They have made good progress. We are waiting for them to make final submission of the documents before we forward them to higher authorities for approval,” he said.
Meanwhile, for the purposes of encouraging security issuance, listing and development of capital markets the government through the Capital Markets and Securities Authority (CMSA) has granted fiscal incentives to issuers of securities.
It has reduced corporate tax from 30 percent to 25 percent for a period of three years provided that the issuer has issued at least 35 percent shares held by public.
The reduced rate is applicable for five years starting from the date of listing. The rationale for this incentive is to attract more listings, according to CMSA.
The other incentive is tax deductibility of all IPO costs for the purposes of income tax determination.
According to the authority, all IPO costs are accepted by the Tanzania Revenue Authority (TRA) as acceptable expenses used in the generation of income and profits, and therefore are taken into consideration when determining profit for tax purposes.
This incentive is meant to make IPO costs tax deductible and extends the benefits to investors. In this case withholding tax on investment income made by Collective Investment Schemes (CIS) is final tax.
Investors in CIS will not be charged tax on the income distributed by CIS after the scheme income taxation under the new arrangement.
The incentive is therefore intended to develop an interest in the DSE secondary market activities, according to the capital markets agency.
In addition, there is no stamp duty on secondary market trades involving listed securities. The incentive is also intended to develop an interest in the DSE secondary market activities.
Again under the new incentive arrangement, there is no tax on capital gain realised by selling listed securities. The tax on unlisted securities is 10 percent. Another incentive is reduction of withholding tax on dividend income from 10 percent for unlisted securities to 5 percent for listed securities. This incentive is intended to encourage investor participation in the bourse.
Reports say that initially ABG had indicated that it was going to complete secondary listing of its shares on the bourse at least by last month.
The company’s chief executive officer, Greg Hawkins, was quoted as saying his firm was still resolving some issues on how to synchronise the requirements of listing shares on the exchange with the London Stock Exchange.
"We are getting very close" to resolving the issues, he said, adding that the listing will not result in any capital raising since it’s cross-listing, which means investors will have the ability to buy African Barrick Gold's shares on either exchange.
The secondary listing is expected to provide more liquidity for the Dar es Salaam Stock Exchange and the firm’s employees will have the ability to invest in the company's shares. About 89 per cent of the company's 4,500 employees are Tanzanians.
Hawkins said that following the secondary listing, it might consider a listing in Johannesburg, the possibility of listing on the Johannesburg Stock Exchange is still "an open question," he said.
He said a listing on the JSE could potentially allow the company to attract an investor base that is restricted in terms of where it can invest.
July 27th, 2011, 09:22 AM
Tanzanians get priority in sale of brewer’s shares
An East African Breweries manufacturing line. Kenyans will have a chance to buy Tanzania Breweries Limited leftover shares next month. File
An East African Breweries manufacturing line. Kenyans will have a chance to buy Tanzania Breweries Limited leftover shares next month. File
Tanzania has relegated Kenyan investors to scramble for leftovers not taken by its residents when 59 million shares in Tanzania Breweries Limited (TBL) come up for sale next month.
The shares on sale represent the 20 per cent stake that was held by Kenya’s East African Breweries Limited in the company under an arrangement entered into by SABMiller and Diageo, the two firms’ parent companies respectively.
“Allotment will be on pro-rata basis. Tanzanian applicants will have first priority over other members of East Africa,” said a brief on the share sale released by Renaissance Capital.
East Africa Breweries is ceding the stake as part of the settlement for its majority control of Serengeti Breweries, effectively bringing to an end its distribution arrangements with TBL in Kenya and Tanzania Breweries in the two markets.
The action, similar to Rwanda’s stance on the Bank of Kigali and Blalirwa IPO, has raised eyebrows in investment circles because they appear to run against the spirit of the East African Community that has seen Kenya and Uganda ascribe resident status to investors from other EAC partner states during share offers.
The share issue will raise at least Sh6 billion for East African Breweries, going by projections from Renaissance Capital which said it had been briefed by a stockbroker handling the transaction.
The report said the shares would be sold at a premium of between 10 and 15 per cent above the Sh102 per share closing price on July 1, suggesting a top value of Sh6.9 billion.
This will be the fourth that Kenyan investors will be given a back-seat after they were completely locked out of Tanzania’s national carrier, Precision Air, IPO three months later.
The decision to favour locals over regional investors means that the two countries are still lagging in implementing what was envisaged by the East African Member States Securities Regulatory Authorities (EASRA), the regional capital markets regulator.
Proposals to tighten integration included the harmonisation of capital market policies, regional legal frameworks and the promotion of cross border listings and trading.
Kenya has already implemented provisions requiring all East Africans to be accorded domestic investor status during share issues.
Gerishon Ikiara, an international economics lecturer at the University of Nairobi, said the preferential treatment arose from fears by smaller economies of being swallowed up by the dominant economies.
“This is a knee-jerk reaction especially from politicians who do not go at the same pace as business people,” said Dr Ikiara.
The hangover from the first East Africa Community where Tanzania felt that it did not get a fair deal on the distribution of assets still lingers a generation down the line.
Dr Ikiara said that the situation is not exclusive to East Africa with the United Kingdom, for example, choosing not to adopt the euro and the Norwegian public voting against joining the European Union in a referendum.
Analysts also said that given the patriotism that alcoholic drinks, especially beer, stir, it would be strategic to sell shares in TBL to Tanzanians over other nationals.
Developing the local stock market and capital creation within the domestic market are other factors that make the choice to first sell TBL shares to Tanzanian locals prudent, said Robert Munuku, a research analyst at Drummond Investment Bank.
The sale would be a boost to the DSE which so far has 16 listed companies. Five Kenyan companies EABL, Nation Media Group, Jubilee Holdings, Kenya Airways and KCB are cross-listed there.
The DSE’s profile is also rising with the exchange emerging top in the 2011 Best Sustainable Stock Exchange category in the World Finance Exchange and Brokers Awards.
Eric Musau, a research analyst at Standard Investment Bank, said that Tanzania has more than enough appetite for the shares which are likely to attract large investors such as pension funds.
The move may also pay off for SABMiller which chose not to buy the stake directly from EABL said Johnson Nderi, a research analyst at Suntra Investment Bank. Buying the shares from the market, he said, was far much easier than negotiating with a principal shareholder.
A report by Renaissance Capital said that the majority marketshare, loosened regulation and strong profits justify the premium on the Sh102 price. “TBL is as profitable as KBL (which makes most of the profit for EABL) and it has a dominant position in a market with much less regulatory risk than Kenya,” said the Renaissance Capital’s report on TBL.
TBL has a 85 per cent marketshare and profits for the 2011 financial year grew by 31 per cent to Sh6.88 billion from 2010’s Sh5.23 billion.
July 27th, 2011, 09:37 AM
Tanzania's Precision Air to kick off IPO this month
Mon Mar 7, 2011 3:53pm GMT
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DAR ES SALAAM (Reuters) - Tanzania's Precision Air will list on the Dar es Salaam Stock Exchange (DSE) this month or by latest early April, its chief executive said on Monday, but declined to give details of the amount it plans to raise.
Partly owned by Kenya Airways -- with a 49 percent stake -- Precision is the main carrier in Tanzania.
"We are at very advanced levels to list Precision Air's shares on the Dar es Salaam Stock Exchange," Alfonse Kioko said.
"We still have plans to issue the IPO this month. If there are any unforeseen delays, then the shares should be floated by early April at the latest."
Kioko said the airline will disclose details on the price range and how much it plans to raise from the IPO after getting regulatory approval in the coming weeks.
"We will be able to reveal all the details of the IPO when we are finally cleared by the Capital Markets and Securities Authority and the DSE," he said.
The airline last year sought regulatory approval for the sale of the shares, which will result in Kenya Airways cutting its stake to 34 percent.
Precision's chairman, Michael Shirima started the company in 1993, offering charter services with a five-seat Piper Aztec plane. The firm operates an ATR 72-500 and ATR 42 planes and a Boeing 737 to 13 destinations in Kenya, Tanzania and Uganda.
Kenya Airways, which bought its stake in 2003, was not immediately available for comment.
Precision said in late 2009 it planned to invest about $300 million within three years to expand its fleet.
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July 27th, 2011, 09:42 AM
NBC shareholders approve 25pc share sale Send to a friend
Tuesday, 03 August 2010 00:00
By Alvar Mwakyusa
Shareholders of the National Bank of Commerce (NBC) have agreed to float 25 per cent of its shares to the public.
Sources privy to the deal have told The Citizen that the bank will issue its initial public offering (IPO) before listing on the Dar es Salaam Stock Exchange (DSE).
According to the sources, the Tanzania government is expected to offload 20 per cent shares out of its 30 per cent stake. On the other hand, South Africa's ABSA group and the International Finance Corporation (IFC), a private company belonging to the World Bank, will sell 2.5 per cent of their shares each.
Finance and Economic Affairs minister Mustafa Mkulo had hinted while presenting budget estimates for fiscal year 2010/2011 that the government is expected to raise Sh30 billion in the IPO.
However, the sources said the aim of selling the shares is to increase Tanzanians’ ownership in the financial institution.
“The government does not want to engage in business, and wants to enable Tanzanians benefit from such institutions,” said the source that did not want to be mentioned.
At present ABSA holds a majority shareholding in the bank. It has a 55 per cent stake while the government of Tanzania has 30 per cent and IFC has 15 per cent shares.
Nevertheless, the sources noted that the deal awaits regulatory approval from the Capital Markets and Securities Authority (CMSA).
"It is, however, unlikely that the IPO would take place this year…people in government circles seem to be much focused on the General Election slated for October 31," said the source.
Contacted for comments, the CMSA chief executive officer, Dr Fratern Mboya, said the regulator was yet to receive an application for the IPO.
"The requirement is that they apply to the CMSA on the intention to float shares. We have not received any application on the NBC IPO," he said in a telephone interview.
And, according to the sources, the cabinet is yet to approve the sale of the government shares.
"But this is just a formality because even shareholders of ABSA and IFC would also have to approve the offloading of shares," said the source.
Reached for comment, Mr Mkulo said he was upcountry and could not comment on the matter.
"I am now in my constituency in Kilosa; you should contact the permanent secretary at the ministry in Dar es Salaam," said the minister.
Efforts to get comments from the Consolidated Holdings Corporation (CHC), custodians of government assets in privatised firms, have not been successful. Questions sent to the CHC by The Citizen inquiring about the NBC IPO have not been answered for two weeks now.
The listing by NBC would make it the fifth bank to trade shares at the DSE. Other banks are NMB Bank, CRDB Bank, Dar es Salaam Community Bank and the Nairobi Stock Exchange (NSE) cross-listed KCB Bank.
The Absa group CEO, Ms Maria Ramos, was quoted during the World Economic Forum for Africa (WEFA) in Dar es Salaam last May as saying that the IPO would dilute the Tanzania government’s stake.
NBC is currently the third largest bank in Tanzania, out of a total of 34 registered banks. It was formed on April 2000 when NBC (1997) Ltd was privatised and sold to ABSA Group Ltd.
NBC (1997) Ltd was established from the restructuring of the then National Bank Commerce in 1997 into three entities, namely NBC Holdings Corporation, National Micro-finance Bank (NMB) and NBC (1997).
July 27th, 2011, 02:42 PM
TANZANIA has made impressive achievements and managed to attract Foreign Direct Investments (FDIs) worth 700 million US dollars (about 1.09tr/-) in 2010, up from 645 million US dollars (nearly 1tr/-) recorded the previous year. This is an 8.5 per cent increase.
In the East African Community (EAC), Tanzania emerged second after Uganda which recorded 846 million US dollars FDIs in 2010, up from 816 million dollars.
Kenya attracted investments worth 133 million US dollars, Rwanda, 42 million US dollars and Burundi 14 million US dollars.
Tanzania was also one of the countries with high shares of intraregional FDI stock because investors from South Africa were active, primarily in the natural resource-related industry.
Speaking at the launch of the 2011 World Investment Report in Dar es Salaam on Tuesday, the Acting Tanzania Investment Centre (TIC) Executive Director, Mr Raymond Mbilinyi, said the report signified the investors' confidence with government's efforts in creating enabling investment climate.
"It is an encouraging report, but we need to build the capacity of domestic investors for sustainable investment and economic growth," he observed.
He said the report was an important tool in implementing the five core priorities in the Five Years Development Plan (201112 - 2015/16) launched last month by President Jakaya Kikwete.
Policy makers should now consider the Non-Equity Modes (NEMs) of international production which include contract manufacturing, services outsourcing, contract farming, franchising, Licensing and management contracts.
One of the key advantages of the NEMs was a flexible arrangement with local firms, with a built-in motive for Transnational Corporations (TNCs), to invest in the viability of their partners through dissemination of knowledge, technology and skills.
It also offers host economies considerable potential for long-term industrial capacity building, through a number of key development impact channels like employment, value added, export generation and technology acquisition.
The NEMs employ an estimated 14 to 16 million workers in developing countries. For example, in the sugar industry in Tanzania, almost 60 per cent of the total feed stock by ILOVO which is a TNC from South Africa is provided by contract farmers.
He said the government would continue to improve infrastructures including power, roads, railways and airlines in order to create a more conducive investment climate.
However, he said one of the risks associated with NEMs was that employment in contract manufacturing, for example, can be highly cyclical and easily displaced.
The United Nations Industrial Development Organization (UNIDO) Country Representative, Mr Emmanuel Kalenzi, said although the post-crisis recovery has been slow to take off, FDI has remained a key component of the world's growth engine.
This year's report, he said would help developing countries' policy makers and the international development community, navigate through challenges posed by the crisis and capitalize on the opportunities for their development gains.
The Royal Netherlands Ambassador, Dr Ad Koekkoek, recommended the creation of enabling environment for domestic investors, saying it would become an incentive and attraction to foreign investors.
By SEBASTIAN MRINDOKO, 26th July 2011
July 27th, 2011, 08:08 PM
FNB opens window
By DAILY NEWS Reporter, 27th July 2011 @ 12:00, Total Comments: 0, Hits: 12
SOUTH Africa’s First National Bank has officially commenced its operations in Tanzania with a fully operational branch in Dar es Salaam. This follows the bank’s announcement that it had received a licence to operate in the country.
According to the bank’s statement, the opening would be followed by two more branches.
The statement said that FNB will initially focus on establishing its footprint in Dar es Salaam with the intention of expanding its representation to all regions of Tanzania.
In addition to branches and ATMs, the bank’s product offering will also include online banking and cell phone banking.
FNB Tanzania CEO, Mr Richard Hudson said the move will enable the bank tap into one of the most attractive markets in East Africa with excellent economic growth and banking sector performance.
“The roll-out of branches, products and services will be on a phased approach and will be tailored to the needs of the citizens of Tanzania”, he said. On his part, Danny Zandamela, CEO of FNB Africa added:
“We are excited about establishing FNB in the East African market and we believe that Tanzania’s demographic profile offers the perfect market for our innovative products and services”, he said, adding:
“FNB’s low cost and convenient products such as cell phone banking will directly address market conditions in Tanzania." He said that Tanzania is a large market enough to accommodate another bank ‘and FNB’s products and services are well suited to the environment’.
“We are therefore confident of success in Tanzania and are looking forward to partnering with the people of Tanzania to make a success of the Group’s investment in the country and remain committed to continually growing our business in East Africa.” said Hudson.
FNB is currently operating in six African countries outside of South Africa, namely Mozambique, Lesotho, Swaziland, Botswana, Namibia and Zambia. It is also considering expanding its footprint into countries like Uganda, Kenya, Angola, Ghana and Nigeria.
July 27th, 2011, 11:18 PM
Good news, with FNB online banking people can now be able to top-up and withdraw money from their Paypal accounts by just linking the profile...
August 12th, 2011, 12:41 AM
TanzaniteOne to list at DSE
Monday, 08 August 2011 07:23 Leonard Mwanga
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DAR ES SALAAM, TANZANIA-Tanzanite One, the gemstones producer and developer, sales has almost doubled in the second quarter, and announced its intention to list at Dar es Salaam Stock Exchange (DSE) before the end of this year.
The firm, operating the largest tanzanite mine in the world at Manyara, said they generated sales worth of 6.2 million US dollar in the said quarter, the best sales figure for the last three years. The financial statement shows that the sales represent an increment of 57 per cent from 3.96 million US dollar that was posted in the first quarter of this year.
The firm's Chief Executive Officer Mr Bernard Olivier said in a statement the sales were achieved through a combination of the sales of cut stones; rough tanzanite smaller than five carats and material sold at the company's retail outlets.
"The Company has had a very successful quarter and we are extremely pleased with the impressive sales results obtained in the second quarter," Mr Olivier said.
The CEO added: "during the period we not only achieved an increase in production and sales compared with same period last year but also achieved the best quarterly sales figures by the company in three years."
Mr Olivier said the firm also was "very excited by the sapphire project in Australia and the initiation of our secondary listing on the Dar es Salaam Stock Exchange."
The secondary listing on the DSE will give Tanzanians and Company employees the ability to invest in the Company's shares. In the second quarter of this year, Tanzanite One achieved production totalling 641,615 carats from the processing of 12,198 tonnes of material at an average grade of 53 carats per tonne for the quarter.
On Tsavorite mine which is close to the tanzanite mine in Manyara, the firm has decided to incorporate the final phase of the Tsavorite resource establishment work with the upcoming bulk sample scheduled to commence later this quarter.
August 17th, 2011, 03:10 PM
Firm starts mobile ticketing
By Songa wa Songa
The Citizen Correspondent
Dar es Salaam. A Dar es Salaam-based marine transporter, Azam Marine and Coastal Fast Ferries limited, has embarked on mobile ticketing in a bid to make the process more convenient to customers.The company believes moving from traditional paper ticketing, will enable it to smoothly avoid unscrupulous traders who used to buy and hoard tickets that they later resell to desperate travelers at inflated prices.
“We used to receive a lot of complaints on passengers paying these tricksters twice as much as the normal fare. Moving to mobile ticketing will help our customers to pay just what they are required to,” the company’s general manager, Mr Hussein Said told The Citizen recently.
According to him, the company commissioned a Finnish company CARUS in 2009 to develop the project software for Euros 200,000 (about Sh400million) and the service was on trial for the past two months.
“So far so good, the service has shown a positive result and if all goes well, we shall officially launch the programme early next month,” he said.He said the idea of mobile banking, the world’s newest technology in ticket sales, came after the company faced some challenges with its former electronic-ticketing project.
“We tried electronic ticketing but as you know, ours is not a credit card economy……with mobile money transfer at a boom in the country, we decided to use the technology,” he said.
Mobile ticketing technology allows a passenger to call to a free number of the partner mobile phone operator, which is linked to the company’s server for reservation reference number. The client then selects the date and time of travel, class and price from the handset menu then pays through mobile money transfer service.
According to Mr Said, the ongoing trial phase involves Vodacom and Zantel but the company will sign up other operators as the programme grows.In addition, the programme will include installation of e-gate that will only allow passage to passengers with the right ticket of the specific time and date.
August 19th, 2011, 11:55 AM
Local bank begins to trade in Chinese currency
Friday, 19 August 2011 09:34
The Stanbic Bank headquarters in Dar es Salaam. PHOTO | FILE
By Victor Karega, The Citizen Correspondent
Dar es Salaam. Stanbic Bank Tanzania has begun to trade the Chinese currency ‘Renminbi’ (RMB), the move aims to provide the business community with faster and discounted trading opportunities abroad.
According to Stanbic Bank head of global markets, Mr Zainul Chandoo, by trading in RMB, local traders seeking to source items from China are offered better pricing and special loans as well.
“They also stand to benefit from no foreign currency exposure due to changing exchange rates and better credit terms as a result of faster transaction dealings as well as develop improved business relationships with their suppliers,” Mr Chandoo told The Citizen in a telephone interview.
China is already the world’s biggest exporter and second largest economy and is likely to achieve top global economic status in the coming years.
“Therefore as a financial institution, we have to keep up with the financial world and ensure we offer the best solutions to our customers so as they can move forward.”
The RMB is a settlement currency that allows both traders and suppliers in China to trade in one currency.
He pointed out that the currency solution facilitates better trading opportunities as well as empowers the bank’s customers to negotiate for better prices.
The banker explained that the currency also enables traders to negotiate for discounts because of the economic benefits the Chinese exporters gain through using RMB as opposed to other foreign currencies such as the US dollar or euro, as the settlement will avoid going through the State Administration of Foreign Exchange (SAFE) for foreign income.
This, in turn, shortens the settlement cycle and reduces working capital cost and can result in up to 10 per cent discounts of the underlying transaction value, he added.
In addition, the suppliers in China are enabled to get faster tax rebates as they qualify for automatic tax refund or exemption on qualifying export products at the moment of invoicing, providing a significantly faster rebate than if other currencies are up to 90 days faster because they do not have to wait for the payment to be cleared as well as VAT benefits.
August 29th, 2011, 10:07 PM
29th August 11
PA shares up for sale at DSE next month
The Guardian Reporter
Precision Air shares will be ready for sale to the public at the Dar-es-Salaam Stock Exchange (DSE) after mid September.
This was said yesterday by Orbit Securities Company Limited chief executive officer Lawren Mlawi in an exclusive interview with The Guardian on Friday.
He noted that the brokers are finalising all procedures as regards the firm’s accounts in order for the shares to be open for members of the public.
“The Initial Public Offering (IPO) might open Precision Air shares during mid September,” he said adding that they have accomplished all necessary details. Precision Air had planned to sell a third of its shares from in an IPO by the end of the year to fund for the firm’s expansion through in an announcement they issued in March this year at the bourse.
The company intends to widen its shareholder base and present shareholders, which include Kenya Airways KQ with 49 percent, who are set to reduce their own holdings substantially.
KQ is expected to retain about 30 percent shareholding but the commercial cooperation with Precision Air in terms of code shared flights and the exploitation of synergy effects will not only continue but is expected to strengthen further.
This was initially said by the Capital Markets and Securities Authority (CMSA) chief executive officer, Dr Fratern Mboya.
He told the media in Dar es Salaam early this year that regulatory approvals particularly evaluation of the company's prospectus are progressing well.
Eventually, Precision Air Services Limited proceeded with the listing processes at the DSE.
Mlawi mentioned that his company attracts customers through agency network whereby clients are called by the company brokers to educate them about shares.
Moreover, the company has clients of over ten years whom they tend to keep and brief them on daily and monthly market reports.
September 7th, 2011, 08:06 PM
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UPDATE 2-African Barrick Gold plans Tanzania listing
Wed Sep 7, 2011 12:20pm GMT
* To raise output to 2 million ounces by 2024
* Seeks acquisition of assets outside Tanzania
By Fumbuka Ng'wanakilala
DAR ES SALAAM, Sept 7 (Reuters) - African Barrick Gold , which has four gold mines in Africa's fourth largest gold producer Tanzania, said on Wednesday it was planning to cross-list on the country's bourse by the end of this year.
The Tanzanian-focused miner, a unit of the world's largest gold miner Barrick Gold Corp , also said it was planning to double output to 2 million ounces by 2024 from a projected 1 million ounces in 2014.
"We have made a commitment to cross-list on the Dar es Salaam Stock Exchange. Our initial plan was to cross-list by the end of September," ABG's Vice President for Corporate Affairs, Deo Mwanyika, told a news conference in Dar es Salaam.
"We are still targeting cross-listing before the end of this year and progress has so far been good," said Mwanyika.
ABG produced nearly 700,000 ounces of gold last year, Mwanyika said, and has a resource of 30 million ounces in Tanzania.
In July, the firm posted forecast-beating output and a 54 percent jump in second-quarter income, despite setbacks including an armed attack on one of its mines.
"We plan to cross-list on the Dar es Salaam Stock Exchange not to raise capital, but to encourage the participation of Tanzanians in the ownership of ABG," Mwanyika told Reuters on the sidelines of the news conference.
ABG is expected to cross-list on the Dar es Salaam Stock Exchange in Q4 2011 after getting approval from the country's exchanges regulator, brokers at the Tanzania bourse told Reuters.
ABG has so far invested around $2 billion in Tanzania and has a market capitalisation of $3.8 billion.
Mwanyika said ABG, which is the largest gold miner in Tanzania, plans to expand its footprint outside the east African country by making acquisitions.
"We are here for the long haul, but we are also looking at other properties elsewhere in Africa," he said.
The gold producer also announced the launch of a new community development fund in Tanzania with a $10 million annual budget.
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September 18th, 2011, 07:49 AM
THE Dar es Salaam Stock Exchange (DSE) emerged among three top performing bourses in Africa, last month, despite soaring inflation rates and weakening of the shilling.
Apart from emerging first in East Africa, the Dar es Salaam bourse managed to beat the Nairobi Stock Exchange (NSE) by far as well as the Nigeria All Share Index and Egypt - EGX 30 index which dropped by 7.7 and 6.9 per cents respectively.
According to the Morgan Stanley Capital International (MSCI) Index that measures a different aspect of global stock market, the Tanzania-All Share Index improved by 0.4 per cent among the ranked African bourses.
At the top, the Namibia stock exchange recorded upper-most returns as the local index rose 5.8 per cent followed by Tunis index that went up by 1.3 per cent.
Having a total of 200,000 local investors owning stakes in different listed companies, the DSE early this year emerged the best Sustainable Stock Exchange in Africa, an award granted by the London-based World Finance, a leading financial magazine.
The Chief Executive Officer of Zan Securities, Mr Raphael Masumbuko, said the outstanding performance was a positive sign that the road was clear for both local and foreign investors to exploit the market potential.
"Despite being small, it is encouraging that our units and capital appreciation are good compared to the neighbouring countries," he said.
Mr Masumbuko said the market performance posed a challenge not only to the listed companies to increase efficiencies but also an incentive to others searching for best returning investments opportunities.
Speaking in a telephone interview from South Africa, The DSE Chief Executive Officer, Mr Gabriel Kitua, said the growing local investors' awareness on the benefits which could be accrued by investing in the market was among the factors for the bourse's outstanding performance in Africa.
"The performance of the listed local companies are encouraging and demonstrate peer confidence on the market and the country's economy to generate investment opportunities in the form of equity," he said, adding that, "our index is expected to grow at 7 per cent in the second part of the year."
In the month under correspondence, the total market capitalization of Dar's bourse at August 30, jumped to 5,977.19bn/- from 5,933.41bn/- recorded at July 31 this year, indicating the investors gain 43.78bn/-.
While their counterparts at the NSE lost an estimated 100bn/- Kenyan shilling (1.7tr/- Tanzania shilling) in August
December 6th, 2011, 11:24 PM
THE growing confidence of multinational investors in the positive performance of the Dar es Salaam Stock Exchange (DSE) is expected to make it one of the most vibrant equity markets in Africa.
The 13-year old DSE emerged as the best performing bourse in East Africa and third in Africa after Egypt and South Africa for the August trading figures. DSE’s total market capitalisation has reached 3,684.55million US dollars (about 6,093.56bn/-).
The performance of the listed local companies has been encouraging as well, which is a demonstration of peer confidence on the market and the country's economy to generate investment opportunities in the form of equity.
The continuing entrance of new players in the equity market will stimulate trading and attract more investors but experts recommend more efforts to make the bourse a significant entity of the economy.
Last week, the African Barrick Gold announced officially to cross list at the Dar es Salaam bourse, which will offer a unique opportunity for local investors to own a stake in one of the largest mining companies in the country.
The mining firm has so far invested around 2 billion US dollars in the country and has a market capitalisation of 3.3 billion US dollars. According to DSE, the coming in of the ABG would add 50,000 more investors in addition to the current number of 200,000.
The DSE Chief Executive Officer, Gabriel Kitua, said recently that Barrick's cross-listing on the bourse would mark a ''major milestone'' in the equity market and has shown the way for other mining firms to follow suit.
Some of the mining companies that have interest are Kibo Mining plc, a mineral exploration company, focused on gold and nickel projects in Tanzania and the Africa-focused oil and gas firm, Ophir Energy Plc.
Also firms operating in the telecommunications sector have expressed interest to list at the Dar es Salaam bourse as a way of localising them. The ABG cross-listing is sending a positive signal of the confidence that multinational companies have in the fast growing DSE.
The shares will be traded on the DSE in the form of depositary receipts. The Cash-rich pension funds are among the major players expected to invest heavily in ABG's shares following approval from the Capital Markets and Securities Authority (CMSA) and the DSE for the share listing.
Many savvy investors have been turning to gold mining stocks, thanks to soaring prices of the precious metal on the world market.
The Chief Executive Officer of the CORE Securities, Mr George Fumbuka, sponsoring dealer for the cross-listing of ABG's shares, said local investors would be allowed to buy shares in the mining company at the DSE using the local currency.
ABG is poised to become the first-ever mining company in the country to be listed on the local stock exchange, a move expected to give a major boost to local ownership of the mining sector.
ABG's Vice-President for Corporate Affairs, Deo Mwanyika, said the miner was on track to boost output from 700,000 ounces in 2010 to 1 million ounces by the end of 2014.
ABG is currently included in the FTSE 250 index on the London Stock Exchange (LSE) made up of the 250 companies immediately below the FTSE 100, which comprises the largest 100 companies listed on the LSE.
ABG is one of the largest companies in the FTSE 250 which is actively followed by a number of investors who track and invest in the index.
The company's four gold-producing mines in Tanzania are Buzwagi, North Mara, Tulawaka and Bulyanhulu, the country's largest underground gold mine, which began production in April 2001.
According to ABG, the response that the local investors will display in its shares after cross listing will provide an important milestone for the mining firm’s consideration to offer portion of its stake for sale to Tanzanians.
By SEBASTIAN MRINDOKO, 6th December 2011 @ 11:00
December 14th, 2011, 06:13 PM
UCHUMI kati ya nchi za Tanzania na Djibouti unatarajia kukua kwa kiwango kikubwa baada ya ufunguzi wa tawi la Benki ya Exim nchini humo ambao litakua kiungo muhimu kwa wafanyabiashara na sekta nyingine za kiuchumi katika nchi hizo mbili.
Benki ya Exim Tanzania imekuwa benki ya kwanza nchini kutanua mabawa yake nje ya Tanzania baada ya kufanikiwa kufungua tawi lake la kwanza mwaka 2007 Comoro, mpango ambao umerahisisha ufanyaji biashara kwa wafanyabiashara wa nchi hizo mbili.
Akizunguma juzi wakati wa uzinduzi rasmi wa benki hiyo nchini Djibouti, Gavana Mkuu wa Benki Kuu ya Djibouti Mahamoud Haid alisema kuwa ifikapo mwaka 2012 nchi yake itakuwa imepiga hatua kubwa kiuchumi kwa kuwa na kadirio la ongezeko la asilimia 5 kutokana na shughuli za bandari na huduma za kifedha kwa ujumla.
“Ujio wa Benki ya Exim ya Tanzania nchini Djibouti utasaidia kusukuma mbele zaidi sekta ya fedha nchini. Uamuzi wa benki wa kuja na kuwekeza hapa umeonyesha kiwango kikubwa zaidi cha kujiamini kwamba kupitia Benki ya Exim maendeleo yatapatikana nchini,” alisema.
Aliongeza kuwa Benki Kuu ya Djibouti imeanzisha kitengo kipya kitakachojikita zaidi katika kusimamia sekta ya kifedha kwa mapana zaidi.
Sherehe za uzinduzi zilipewa baraka na Rais wa Jamhuri ya watu wa
Djibouti Ismail Omar Guelleh pamoja na Mkewe Kadra Mahamoud ambaye aliamua kufungua akaunti katika tawi hilo kuonyesha imani na benki wakati alipofanya ziara katika ofisi za benki hiyo.
Kwa upande wake, Mwenyekiti wa Bodi ya Wakurugenzi wa Benki ya Exim Yogesh Manek alisema kuwa maamuzi ya benki hiyo kufungua tawi hilo nchini Djibouti yametokana na hali nzuri ya kisiasa iliyopo nchini humo pamoja na kutanuka kwa soko hasa la sekta ya kibenki na fedha nchini humo.
“Imani tuliyonayo juu ya Djibouti kama taifa ilitufanya tufungue tawi letu lingine hapa. Pamoja na hayo kumekuwa na ongezeko kubwa la wawekezaji kutoka nje wanaowekeza nchini ambao wanahaki ya kupata hudumu za kibenki zenye ubora kutoka katika benki bora kama yetu.
“Kutokana na ushirikiano wa serikali pamoja na Benki Kuu, tuna uhakika kwamba tutakuwa na uwezo wa kuchangia kikamilifu katika maendeleo ya uchumi nchini,” alisema.
Manek alisema kuwa katika shughuli zake benki itahakikisha inatoa huduma za kibenki zenye ubora ikitoa kipaumbele zaidi kwa wateja wake pamoja na bidhaa maalum zinazoweza kuchangia ufanisi wa huduma za kibenki ndani ya nchi.
Benki ya Exim Tanzania toka kuanzishwa kwake nchini Tanzania mwaka 1997 imekuwa ikiendelea kuonyesha maendeleo makubwa katika nyanja zote za biashara ya benki ikiwa inaonyesha ongezeko la asilimia 22 katika aseti zake.
Mpaka sasa benki imekuwa na matawi 24, Mashine za kutolea huduma ya fedha (ATMs) 51 na zaidi ya vituo vya mauzo 300 ikitanuka na kuenea katika mikoa 11 Tanzania nzima
December 19th, 2011, 01:49 PM
DSE’s impressive performance lures investors
THE rise in the level of investors’ confidence demonstrated by impressive performances of the Dar es Salaam Stock Exchange (DSE) has attracted massive investments which in turn led to increased market capitalization.
This was said on Sunday in Dar es Salaam by the DSE Chief Executive Officer, Mr Gabriel Kitua in an interview over the performance of the bourse and the benefits accrued by investors.
“The appreciation of the value of listed securities has improved the wealth and so the livelihood of the investors holding stocks at the equity market,” Mr Kitua said. He said for example, the market capitalization increased by 22 per cent from 5,012.86bn/- in January to 6,093.56bn/- as of November, this year.
Kitua said the Tanzania Share Index that tracks movement in value of listed domestic companies appreciated by 22 per cent from 930.09 points during January, this year to 1,142.97 points as of the end of November.
Likewise, the all share index tracing the movement in value of all firms including the cross listed stocks appreciated by 12 per cent. He said the indices’ appreciation is notwithstanding the dividend payments that were made by the listed companies during the year.
With inflation at less than 19 per cent, the DSE CEO noted that the 22 per cent appreciation ensured net positive gain to investors on stocks listed at the bourse. “Despite the challenges seen in the macro-economic parameters like weak shilling against major currencies, high inflation, high interest rates, the DSE recorded increased activity on both equity and debt instruments,” said Mr Moremi Marwa of Tanzania Securities Limited (TSL).
Mr Marwa noted that positive performances on the bourse which led to gains made by investors are attributed to the increase in prices for most counters in the exchange.
He, however, recommended that more concerted efforts to create awareness on the availability of relatively cheaper capital at the bourse compared to existing tradition approaches, be made. Kitua wants investors to be informed on the availability of alternative profitable channels of investments other than savings and bank deposits
January 16th, 2012, 04:49 PM
new branch ilala dar es salaam
January 16th, 2012, 05:25 PM
Exim hawataki mchezo, tayari wako Comoro, Djibouti, na Zambia...
September 11th, 2012, 02:51 PM
Tanzania: India Keen to Finance Water Project
Tagged: Asia, Australia, and Africa, Business, East Africa, Environment, External Relations, Governance, Infrastructure, Tanzania, Trade, Water
BY ABDUEL ELINAZA, 11 SEPTEMBER 2012
THE government of India is set to issue a 178.125 million US dollars (about 285bn/-) credit to assist rehabilitating and improving Dar es Salaam water supply, Indian High Commissioner to Tanzania, Mr Debnath Shaw, said on Monday.
Mr Shaw said the second line of credit would be issued by Exim Bank of India to help the country develop water infrastructure in the commercial capital. "Negotiations are still underway, but are likely to be concluded in about a month from now," Mr Shaw told the 'Daily News' on the sidelines of opening of Bank of India Zanaki Street branch.
He said he could not give the transaction details as the negotiations are ongoing but hinted that the package will serve two regions, the other one would be named later. "Once the negotiations are concluded and an agreement is signed, I will give further details as everything is expected to be finalized in a month's time," Mr Shaw said.
The High Commissioner said India is committed to assist the country in delivering and improving social services following a long history of good relations. He, however, said more efforts are needed to increase economic and trade ties to at least match the political friendship.
India is Tanzania's second largest investor. In 2011, when on official visit to Tanzania, India's Prime Minister, Mr Manmohan Singh, announced a line of credit of 180 million US dollars (about 288bn/-) for development of water supply projects in Dar es Salaam and coastal regions. During the visit, Mr Singh also announced a grant of 10 million US dollars (about 16bn/-) for projects in social and educational sectors, projects which would be identified by Dar es Salaam.
The Indian PM also announced Vocational Training Centre and a grant of 100,000 US dollars (about 160m/-) for Zanzibar for purchase of laboratory equipment for schools. Tanzania is one of the largest beneficiaries of the Technical, Economic and Scientific Cooperation (ITEC) programme, which is an Agreement for Friendship, signed in 1966 between Dar and Delhi.
ITEC cooperation has been extended to Tanzania since 1972. Starting with 24 trainees annually, the number has gradually increased to 200 in 2011. Tanzania and India have traditionally enjoyed close, friendly and co-operative relations. From the 1960s to the 1980s the political relationship was driven largely by shared ideological commitments to anti-colonialism, anti-racism, socialism in various forms as well as genuine desire for South-South cooperation.
September 11th, 2012, 02:53 PM
Barclays, Absa in Talks to Combine African Banking Assets
By Renee Bonorchis, Howard Mustoe and Ambereen Choudhury on August 21, 2012
Barclays Plc (BARC), Britain’s second- biggest lender by assets, and South Africa’s Absa Group Ltd. (ASA) said they’re in talks to combine their African units and complete a plan started seven years ago.
There’s no certainty the talks will lead to any deal, which wouldn’t be completed until 2013, the banks said in a statement. The combination would affect assets in Kenya, Botswana, Zambia, Tanzania and Ghana. Barclays, based in London, bought 54 percent of Absa in 2005 for $4.5 billion to expand in emerging markets.
Barclays shares rose. The British bank’s African operations may be worth as much as 20 billion rand ($2.41 billion), according to Patrice Rassou, an Absa investor who helps oversee about $41 billion as head of equities at Sanlam Investment Management in Cape Town. The continent has 1 billion people, faster growth rates than developed nations and as much as 80 percent of its adult population don’t yet have bank accounts.
“These are well-run, profitable operations with little overlap with Absa except for Tanzania,” Rassou said by phone. Strategically, it’s the right move for Absa given the potential for African growth, he said.
Robert Diamond, who resigned as Barclays chief executive officer last month after the lender was fined for manipulating global interest rates, sought to boost the British bank’s profit by combining Absa and Barclays’s products and customer bases across more than 10 African countries. Together the banks have almost 60,000 staff on the continent.
‘Single Entry Point’
Absa dropped its original plan to buy the Barclays assets in 2008 after commodity-driven economic growth in Africa sent their earnings surging, making the businesses too expensive to acquire. Barclays revived the plan in April 2011, aiming to consolidate operations at Absa headquarters in Johannesburg and move other work to Dubai.
The South African bank’s shareholders will get “a single entry point into Africa” from a deal, “giving shareholders in both businesses the benefit of African growth,” CEO Maria Ramos said in a telephone interview from Johannesburg today.
It’s not clear how the ownership structure will work or whether Barclays will take a larger stake in Absa, as “there’s lots of work to be done and it’s very early days,” Ramos said.
The announcement of the potential combination has “nothing to do with Bob leaving last month” and the operational integration has been underway for more than a year, Ramos said, referring to Diamond.
Barclays’s listed subsidiaries in Kenya and Botswana will be maintained, according to the U.K. bank. Kenya is Barclays’ largest African unit, Ramos said.
Barclays’s pretax profit from Africa, including the bank’s holding in Absa, rose 13 percent to 910 million pounds ($1.4 billion) in 2011. The unit contributed 15 percent of the bank’s 5.97 billion-pound pretax profit. Together, Barclays and Absa operate in 12 countries and have over 14 million customers, according to Absa’s annual report.
“They’ll have a single base and a single entity and be able to take a lot of costs out of it,” said Christopher Wheeler, an analyst at Mediobanca SpA in London. “It would be a net positive and will mean they can compete with the likes of Standard Chartered (STAN) in those markets.”
Since Barclays bought into Absa in 2005, the lender has gone from being South Africa’s best-performing bank stock to its worst after an exodus of executives, slowing income, and rising bad debts caused profit to slump. Rivals Standard Bank Group Ltd. (SBK) and FirstRand Ltd. (FSR) have boosted lending and expanded in Africa while Absa’s growth on the continent stalled.
“ This could prove to be a transformational transaction for Absa,” said Greg Saffy, a banks analyst at RMB Morgan Stanley in Johannesburg. “The key issue now is relative price.”
Barclays shares rose 3.2 percent to 197.05 pence by the close in London, giving the bank a market value of about 24.1 billion pounds. The stock has risen 12 percent this year, compared with the FTSE 350 Banks Index’s 14 percent advance in the period.
Absa slipped 0.9 percent to 141.01 rand in Johannesburg. It is the worst-performing stock on the six-member FTSE/JSE Africa Banks Index, little changed this year compared with the average return of 19 percent.
To contact the reporters on this story: Renee Bonorchis at firstname.lastname@example.org; Ambereen Choudhury in London at email@example.com; Howard Mustoe in London at firstname.lastname@example.org.
To contact the editor responsible for this story: Edward Evans at email@example.com
Tanzania: 'Barclays, Absa Merger No Threat'
Tagged: Banking, Business, Company, East Africa, South Africa, Southern Africa, Tanzania
BY ABDUEL ELINAZA, 25 AUGUST 2012
BARCLAYS Bank Plc has said the ongoing talks with its subsidiary Absa Group of South Africa, on a proposed merger, would not affect the operations of Barclays Tanzania or the National Bank of Commerce (NBC).
"Barclays Bank of Tanzania and NBC would continue to operate as two separate and independent entities, with separate boards and management teams," a statement issued by Acting Head of Corporate Affairs Tunu Kavishe in Dar es Salaam on Friday said.
The bank assured shareholders that it was not guaranteed that the discussions would lead to a merger. And even then, the proposal was not expected to be concluded before next year.
Barclays first opened its doors in Tanzania in 1925 and continued to operate in the country until 1967 when its operations were nationalized to become NBC. It made a comeback in the year 2000.
Meanwhile, according to a statement issued by the NBC in Dar es Salaam on Friday, despite tough and aggressive competition and a sluggish economy, the bank believes that there are opportunities in the Tanzanian market that can be leveraged to ensure solid business growth.
The bank has declared a second quarter loss of 20.2bn/- which equated into a cumulative six months loss of 17.7bn/-, but believes that it can wipe out the losses.
The statement also said that the losses in the second quarter can be attributed to two items, namely Corporate Impairment losses amounting to 13.9bn/- and provisions raised for cost and under accruals from 2008 to June 2012 of 13.7bn/-, relating to technical assistance provided by a parent company abroad.
The statement quoted Acting Managing Director, Marius Alberts as saying that an independent contractor was used to review all balance sheet accounts and close off all items at risk. "These have been accounted for, it is something of the past, and we are looking forward to a very positive six months," he said.
September 13th, 2012, 10:27 PM
New bank to meet Tanzania central bank demands
Wednesday, 12 September 2012 11:30 John Mbalamwezi
DAR ES SALAAM, TANZANIA - Mkombozi Commercial Bank said it plans to raise its capital to over Tsh15bn ($9.3m) from the current Tsh10.1bn ($6.3m) to comply with the central bank regulation which requires commercial depository to have such capital.
Aiming at spreading its presence to the rest of the country in a very near future, a three years old commercial bank, which is under Tanzania Episcopal Conference (TEC), plans to raise the capital in three years to come, said Rev. Bishop Severine Niwemugizi, the Vice President of the Tanzania Bishop Council who initiated the idea to start the bank.
"We aim at spreading our wings to the rest of the country so as our bank would be able to serve many people in the country," Rev. Bishop Niwemugizi said in Dar es Salaam last week during opening of the Kariakoo branch which will become the bank's fourth branch since established in 2009.
"I call upon stakeholders and those with goodwill to our fast-growing bank to offer their support by buying the bank's shares to raise our capital to over $9.3 m to enable the bank to implement its expansion plan," Rev. Niwemugizi said.
He said that for the time being the bank has over 10,000 depositors and in order to increase the number of our customers, "we plan to open four other branches in Iringa, Moshi, Bukoba and Arusha by 2015.
According to bank's external auditor, Ernest & Young, for the year ended December 2011, the bank has achieved a tremendous growth which as at last year, the bank has been able to make profit of Tsh37.4m ($.23,421).
The bank's Managing Director, Ms. Edwina Lupembe said that the bank has been able to lend over Tsh600m ($375,735) to more than 100 small groups of the entrepreneurs with a lending rate of 22.5% a month.
"To raise the required capital and the bank's assets is the challenge for us but our plan to extend wings to the rest of the country should be implemented," Lupembe said.
She added that the bank's assets have increased from Tsh7.4bn ($4.6m) for year ended 2009 to Tsh39.06bn ($24.4m) by the end of August 2012. The bank's deposits have also increased from Tsh16.4bn ($10.2m) in the year 2010 to Tsh21.92bn ($13.7m) in 2011.
December 12th, 2012, 10:43 AM
Tanzania's CRDB Bank starts operations in Burundi
Fri, Dec 7 2012
NAIROBI, Dec 7 (Reuters) - Tanzania's CRDB Bank has opened a branch in neighbouring Burundi to tap growing trade between the two nations, its managing director said on Friday.
With only five percent of the Burundian population of eight million people having a bank account, the landlocked central African nation is seen as a banking frontier, attracting lenders like Kenya's KCB and Togo-based Ecobank.
Trade between Burundi and Tanzania has been growing in recent years, mainly because Burundian businesses rely heavily on the Tanzanian port of Dar es Salaam to import goods.
"People have had to carry chunks of money across the border to trade," said Charles Kimei, CRDB's head, in a statement.
Kimei said the bank would turn its attention towards the Democratic Republic of Congo, a vast, mineral-producing central African country that lacks a developed banking sector.
The Burundian President Pierre Nkurunziza welcomed CRDB, saying the country required more banks to help it become economically self-sufficient. It is one of the least-developed nations in the world.
CRDB, which is the largest commercial bank in Tanzania with over 85 outlets, said it spent $10 million to establish the Burundian operation. (Reporting by Duncan Miriri; Editing by Richard Lough and Helen Massy-Beresford)
December 21st, 2012, 04:03 PM
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Absa Tanzania Unit to Boost Capital as Banks’ Bad Loans Grow
By David Malingha Doya and Renee Bonorchis - Dec 20, 2012
Absa Group Ltd. (ASA), the South African bank controlled by Barclays Plc (BARC), said shareholders are in talks to boost capital at its Tanzanian unit to help it grow amid an increase in bad debts and regulatory changes.
The National Bank of Commerce Ltd. in Tanzania remains well capitalized, Johannesburg-based Absa said in an e-mailed response to questions today. A plan to raise funds in the first quarter of next year would support the lender’s growth opportunities, Absa said.
NBC is considering boosting the capital it’s required to hold against deposits by 4 percent by raising funds “internally” and a decision will be made next month, Managing Director Lawrence Mafuru said in an interview in the commercial capital, Dar es Salaam. Absa owns 55 percent of NBC.
While lenders including FirstRand Ltd. (FSR) and Ecobank Transnational Inc. (ETI) have expanded in the East African nation, bad debts increased at four of Tanzania’s top six banks by assets in the three months through September, according to Serengeti Advisors Ltd., a Dar es Salaam-based research group. Impairments at NBC, the fourth-largest lender, grew to 14.7 percent of total loans in the third quarter, compared with 11.1 percent three months earlier, it said.
Federal Bank of the Middle East Ltd.’s Tanzanian unit, the country’s biggest lender, also reported increased bad debts along with National Microfinance Bank Ltd. (NMB) and Standard Chartered Bank Tanzania Ltd., Serengeti said.
“We need the funds to allow the bank to face the market with a lot more strength,” Mafuru said yesterday. “The money will help the bank remain within regulatory requirements of capital adequacy, as we increase lending and invest in technology.”
Impairments have increased partly because of the failure by borrowers in the agriculture industry to repay debts because of lower cotton prices, Mafuru said.
About a quarter of all loans in Tanzania go to the agriculture industry, with about 10 percent going to cotton farmers, according to Mafuru. The fiber is Tanzania’s second- biggest export commodity, after gold, he said.
The average ratio of non-performing loans to total loans for all 45 banks that operate in Tanzania was 8.1 percent in June, having risen from 7.5 percent in March and 6.7 percent December 2011, according to the Bank of Tanzania.
Tanzanian lenders have the highest level of impairments in the five-nation East African Community, said Abubakar Ukhotya, operations manager at the central bank’s directorate of banking supervision.
“Our desirable levels of NPL ratio to the loan book is 5 percent,” he said in an interview. The ratio in Kenya, East Africa’s biggest economy, is 5.4 percent, and 2.5 percent in Uganda, according to World Bank data.
Tanzanian banks’ assets may grow as much as 15 percent next year, spurred by an accelerating economy, increased electricity output and expanding manufacturing and construction industries, said Mafuru, who also heads the Tanzania Bankers Association. Growth this year was 10 percent, according to Serengeti.
In the “medium term,” banks in Tanzania stand to benefit from increased business from the discovery of 33 trillion cubic feet of gas off its coast by companies including BG Group Plc (BG/) and Statoil ASA (STL), it said.
“The hydrocarbon discoveries present significant opportunity for domestic banks to support prospective local suppliers of goods and services to the large firms carrying out exploration and production activities in the gas sector,” Serengeti analyst Aidan Eyakuze said in an e-mailed response to questions. “I anticipate further banking asset growth to be driven from these activities in the medium term.”
Tanzania, East Africa’s second-biggest economy, may grow 6.8 percent in 2013 compared with an estimated 6.5 percent this year, according to the International Monetary Fund.
Tanzania’s government owns 30 percent of NBC, while the International Finance Corp., the World Bank’s private-lending arm, holds 15 percent.
NBC last month reported net income fell by almost half to 4.2 billion shillings ($2.6 million) in the third quarter, from 8.2 billion shillings a year earlier.
To contact the reporters on this story: David Malingha Doya in Dar es Salaam at firstname.lastname@example.org; Renee Bonorchis in Johannesburg at email@example.com
To contact the editor responsible for this story: Paul Richardson at firstname.lastname@example.org