NIC Bank Tanzania receives TZs 8.5Billion capital boost:Funds to support the Bank’s lending capacity targeted at Corporate and SME market

NIC Bank Tanzania will benefit from Tzs 8.5 Billion of additional capital from the Bank’s shareholders. The funds will be disseminated in two tranches of Tzs 5.8B with the injection of additional capital from NIC Bank Kenya already done in December 2013, with the Tzs 2.7B balance from the other local shareholders of NIC Bank Tanzania expected within a period of 6 months but no later than June 2014.

“A growing financial need in this market has required that NIC Bank Tanzania further grow its’ competitive position. The capital will be used to fund the Bank’s business plan in the coming year with the aim of growing our market share with a focus on Corporate and SME lending, “said Mr. Pankaj Kansara – NIC Bank Tanzania MD.

NIC Tanzania is banking on the emerging opportunities inasset finance, trade finance and infrastructure project financing to increase its’ market share, driven by  an improved business framework that has helped attract foreign direct investments and spur SME growth.

“The capital-injection scheme is an appropriate, necessary and proportionate means of stabilizing the institution and will also enable us increase lending to the Tanzanian market across the Corporate and SME segments” added Mr. Kansara.

“This additional capital will partly finance the growth of theanticipated loan book for 2014 and is expected to cushion the bank’s undertaking in respect to its Non-Performing Loan book” explained Mr. Kansara.

NIC Bank Tanzania has grown its balance sheet from Tzs 30 Billion in 2009 to Tzs 180 Billion in 2013, representing an annualized growth of 43 %.

“Looking at the success of our parent company, we hope to leverage on these strengths and replicate the product offering in the Tanzania market where applicable, while  exploiting the available resources at the Group level to develop even more targeted products to grow our presence,”said Mr. Kansara.

“We are pleased by the demonstration of confidence by the Bank’s shareholders through their decision to inject additional capital,” added Mr. Kansara.

“The shareholders remain committed to the bank’s operations in Tanzania and see growth opportunities arising from the integration of the East African Community. This capital injection will support our operations, taking into provision the bank’s Non-Performing Loan book,” concluded Mr. Kansara.

In 2013, NIC Bank Tanzania undertook a very successful rights issue of Tzs8.5 billion with the parent company increasing its shareholding to68.97%.

The Bank operates on a fully integrated system, offering a seamless cross border platform and in support of Corporates operating within the East Africa Community lock.

NIC Bank Tanzania currently has branches in Dar es Salaam, Arusha, Mwanza and Kahama.

In November last year, NIC Bank Tanzania moved its headquarters to Ohio Street and opened an additional branch at the same location.

NIC Bank Tanzania is a subsidiary of Nairobi Securities Exchange (NSE) listed NIC Bank holding which owns majority stake following the acquisition of the Savings & Finance Commercial Bank Limited in 2009.

NIC Bank’s acquisition of majority interest in Savings & Finance Commercial Bank (S&F) was the Bank’s first cross-border acquisition, underlining the bank’s growth and expansion strategy in the region.