NMB Bank breaks record with Sh290 billion net profit

Dar es Salaam. NMB Bank Plc had yet another good year in 2021 as its profit rose to a record level, translating into mouth-watering returns on investors’ money.

The bank, which is listed on the Dar es Salaam Stock Exchange (DSE), reported on Thursday that its profit before tax grew by 41 percent to reach Sh420 billion in 2021, from Sh301 billion that the lender registered in 2020.

This translates into a net profit of Sh289 billion in 2021 which is 39 percent more than Sh210 billion that it registered in 2020.

The money came from double-digit growth rates in both funded and non-funded income streams.

The figures, published in the media yesterday, show that NMB Bank’s net interest income advanced by 19 percent to settle Sh682.115 billion in 2021 from Sh571.165 billion in 2020.

On the other hand, non-interest income rose by 15 percent to reach Sh306.46 billion in 2021 from Sh271.279 billion in 2020.

The bank, which boasts of assets worth Sh8.7 trillion, also reported substantial improvements in the management of its operational efficiency, with further improved cost-to-income ratio and in non performing loans (NPLs).

Its improved cost-to-income ratio was quoted at 47 percent in 2021 while its NPLs were quoted at 3.2 percent.

The Bank of Tanzania (BoT) wants commercial banks to maintain their cost-to-income ratios at not more than 55 percent while NPLs must not exceed five percent.

NMB Bank Plc chief executive officer Ruth Zaipuna (pictured) attributes the performance to what she termed as ‘disciplined execution of its strategy, strong client activity, high-staff morale, and leadership agility’.

“I remain confident that with the disciplined execution of our strategy, increased customer activities, high staff morale, and strong leadership, we will sustain this strong growth momentum of our underlying business,” she said in a statement yesterday.

She said the growth puts the lender on the right path to achieving its mission of being the vehicle of social and economic development in Tanzania.

“Our focus and contribution in the agriculture sector continued during the year, whereby we were the first bank to set aside Sh100 billion as special agriculture fund for lending to the agriculture value chain at interest rates not exceeding 10 percent,” said Ms Zaipuna, detailing a number of other programmes that her bank has achieved during the past few months, including spending over Sh2 billion towards various social impact initiatives in education, health, financial literacy and environment.

According to the statement, NMB Bank’s loans and advanced increased by 13 percent to Sh4.6 trillion in 2021, courtesy of strong growth in its key market segments including agri-business, SME and Personal Loans.

Total Deposits grew by 25 percent to Sh6.4 trillion at the end of December 2021 compared to Sh5.3 trillion in December 2020.