NATIONAL BANK OF COMMERCE MARKS 50 YEARS, REMITS TSHS. 1.2 BILLION DIVIDEND TO TREASURY

Minister for Finance and Planning, Dr Philip Mpango (first left), receives a dummy cheque for Tshs 1.2 billion from NBC Ltd Managing Director, Edward Marks (second right), as the government’s dividend from the bank being the second largest shareholder with 30 percent of shares during the ceremony to mark the NBC 50 years celebrations in Dodoma over the weekend. Looking on are NBC Board Chairman, Nehemiah Mchechu (second left) and Elias Mwakibinga, Director in the Office of the Treasury Registrar (first right).

The Board of Directors of the National Bank of Commerce (NBC Tanzania) for the first time in its history has approved the transfer of 1.2bn/- to its shareholder.

Board Chairman Mr Nehemiah Mchechu announced Friday during the bank’s golden jubilee, the bank had been turning profit since 2015, but could not issue proper dividend to its investors.

Tanzanian government is the second largest shareholder with 30 per cent share after the South African banking group—Barclays Africa Group formally Absa Group Limited that owns 55 per cent and International Finance Corporation (IFC) that owns 15 per cent stake in NBC.

“In 2015 and 2016, NBC posted a profit of 12bn/- and 14bn/- respectively and this year the board finally approved dividend of 1.2bn/- to be transferred to the treasury, one of our largest shareholder,” Mr Mchechu said when addressing the podium.

Finance and Planning Minister Dr Phillip Mpango who represented the Prime Minister Kassim Majaliwa told delegates the government had long been awaiting for such returns as an investor.

“This is the time that all the institutions with whom the government has shares start paying proper dividend … I expect you will triple the payments in the next financial year,” he said.

However, the minister highlighted that there has been poor penetration of financial institution, especially, banks in rural areas with figures indicating only 17 per cent of bankable population had access to banks.

The trend puts the government target to reach 75 per cent of bankable population to use banks come 2017 in question.

As response, Dr Mpango urged the country’s third largest bank by asset and other banks to streamline their focus targeting Small, Micro and Medium enterprises as well as private sector to promote financial inclusion.

“The government plans to transform its economy into a middle income country. This means we target our economic growth to jump from the current 7per cent to 10 per cent in 2020. In additional we are seeking to increase our per capita income from us$1,006 in 2015 to us$1,500 in 2020,” he said pointing out it is by the help of the banks that the government’s vision would be attained.

Apparently he said most people including elite are still afraid of borrowing from banks. Dr Mpango challenged the banks to lower their loan interest considering that the central bank had as well lowered its interest from 16 per cent to 12 per cent.

The minister, however lauded the bank for its innovativeness having been the pioneer of agency banking, embedded insurance cover and online banking.

Earlier, the board Chairman Mr Mchechu said after 50 years, the bank was considering to re-launch a number of operations aiming to return the bank to the top post as a financial institution in the country.
NBC with a net asset of approximately 1.7trn/- has already issued loan amounting to 1trn/- to the government institutions, private sector, business firms and individuals.

According to Mchechu the bank has the highest ambition to help the government and partners spur economic growth.