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Golden Sibanda : Senior Business Reporter
NMBZ Holdings has secured $40 million lines of credit from African Export and Import Bank and European development finance institutions for lending to productive sectors and small enterprises, group chief executive officer Benefit Washaya has said. Mr Washaya told the bank’s annual general meeting yesterday that the bank has secured a $20 million loan facility from Afreximbank and is now in the process of drawing down on the loan facility.He said the bank is on the verge of concluding another $20 million line of credit facility with two European development finance institutions and should seal the agreement in the next two months.
“Our core focus remains on sourcing the much needed lines of credit in order to support the productive sectors of the economy and this will also ease the cash and nostro challenges.
“We have received an approval for $20 million from Afreximbank and we are currently in the process of drawing down on that line (of credit). Further, I am pleased to advise that two European DFIs visited us last month for a due diligence with a view to providing us with lines (of credit) totalling $20 million.
“The due diligence exercise went very well and I am optimistic that within the next two months we will be able to access the $20 million, which will largely be used to support the SMEs sector in this economy,” Mr Washaya said after the AGM.
He said that the bank had done well in the area of raising lines of credit, leveraging on the group’s strong shareholder base. NMBZ’s shareholders include Old Mutual, FMO of Netherlands, AfricInvest of Tunisia and Norfund of Norway.
Giving a brief trading update for the period January to April 2015, Mr Washaya said total loans, deposits and advances in the period under review remained unchanged from December 31, 2015.
“Our operating income for the four months to April 30, 2016, at $13,6 million recorded a 2 percent decline when compared to the same period last year. This was due to a decline in non-funded income due to reduced transactional volumes induced by the cash and nostro challenges and our drive to migrate customers to less expensive electronic channels,” Mr Washaya said.
Operating expenses for the four months remained static compared to the same period last year, due to aggressive cost containment measures adopted by the bank. Cost to income ratio for the period in review was marginally up at 66 percent against 65 percent recorded in the comparative period last year.
The NMBZ boss said that the non-performing loans ratio has declined to 13,6 percent, as at April 30, from 16,5 percent at the same time last year due to aggressive collections by the bank.
“I will acknowledge that the NPL ratio at 13,62 percent is above market average, but I just want to put this into context in that on the available information, as at December 31, 2015, banks had transferred toxic loans in the sum of $357 million to ZAMCO and of that NMBZ’s contribution was a mere $1 million.”
Mr Washaya said that NMBZ’s capital base continues to grow and shareholder funds stood at $53 million as at April 30, 2015 while the bank remains on track to reach 2020 regulatory capital levels.
He also said agency banking and technology driven channels will support the business model going forward in order to advance financial inclusion. “We are rolling our agency banking with a retailer who has 60 branches across the country.”
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