Exim Bank has continued to maintain its positioning as 5th largest Bank in terms of asset base.
This is according to the recently published results, Group’s total assets stood TZS 1.6 Trillion ($700.34 million) with growth driven by increase in customer deposits.
A statement seen by The Exchange shows that the bank’s 100% owned subsidiaries at Djibouti and Comoros operations recorded superlative performance with best ever profits.
“Exim Bank is now ranked fourth & second in these respective territories.” It says.
Performance of Bank’s Tanzania operations was stable on the top line; however, the bottom line was impacted due to higher provisioning on the impaired assets. The bank, with a step towards its preparedness to the newly introduced norms of accounting effective from January 2018 viz. IFRS9 had made higher provisions to the tune of TZS 29 Billion during the year 2017 as compared to TZS 2 Billion ($ 875,656) during the previous year (2016).
The bank also wrote off impaired assets worth TZS 3.35 Billion ($1.466 million) , in compliance of regulatory guidelines.
Bank’s operating profits stood at TZS 39 Billion. With increased provisions, the bank Profit before tax was lower at TZS 9.6 Billion.
“It is important to note that the bank had extraordinary gains to the tune of TZS 46 Billion ($20.14) in the year 2016 due to (one off) sale of its equity stake in one of the local entities in the Country.” The statement reads.
The bank has further planned to write off a major chunk of its impaired assets during Q1/18 in compliance to the newly introduced guidance from the central bank. This will help reduction in bank’s impaired assets portfolio from 14.63% to 8.95% as at end of March 2018. The Bank Acting Group CEO reaffirmed the Bank’s endeavor to continuous improving the quality of loan portfolio to the target of below 5% by December 2018.
The Group recorded a 7% growth in Net interest income to TZS 97 Billion, driven by earning asset book growth, better yields and contained cost of funds despite increasing non-performing asset book which was subsequently written-off.Non-funded income; foreign exchange income as well as fees and commission income recorded reasonably annual growth of 24% and 12% to TZS 12 Billion ($5.25million) and 37 Billion ($16.202 million) respectively driven by increased volumes of transactions in all of channels. “Thanks to guaranteed turnaround time and good service delivery across our networks”, Acting Group CEO said.
Group’s total shareholders’ fund maintained @TZS 231 Billion ($101.64 million) as at Dec 2017 while core capital improved to TZS 162 Billion (2016: TZS 156 Billion) which is far more than 10 times required level for the bank without foreign subsidiaries while the capital adequacy ratios as at 31st December 2017, Tier I and Tier II ratios were at 17.34% and 19.32%, well above the minimum regulatory requirement of 12.5% and 14.5% respectively.
Exim Group, one of the largest indigenous banks in the country, has been making sustained investments in technology for the last 3 years. The Bank has seen these investments starting to pay off. The bank has been able to make a niche in the Corporate and SME sector having introduced its Cash Management Solution during the year. Bank’s exclusive ‘Cash Deposit Machines’ on/off site and handy Cheque scanners are considered as the favorites amongst Corporates for their ease of use, accuracy, speed & safety of transactions.
Djibouti and Comoros recorded a robust performance during the year with net profit (before management fees) at TZS 4.8 Billion ($2.112 million) and TZS 6.5 Billion ($2.860 million) respectively during the year. The profits were driven by well-diversified sources of income – interest income and non-funded income streams – FX trading and transaction banking and commissions on fund transfers. Return on equity to these two subsidiaries were far above the normal returns @50% and 40% for Djibouti and Comoros respectively.
The Group audited financials indicate that net loans and advances were up by 9% from TZS 838 Billion ($368.72 million) to TZS 912 Billion ($401.28 million) during 2017; loan portfolio is fairly diversified across sectors, reflecting the variety of the Tanzanian economy and its buoyant private sector.
The loans and advances were largely financed by customer deposits with focus on low costs sourcing, driven by cash management solutions we provide to our customers range from digital products which include internet banking, cash scanning, cash deposit machines, etc. to door-to-door cash pickups. The customer deposit based recorded a reasonable growth of 7% above a Trillion mark TZS 1.2 Trillion ($528 million).
“There was growth posted by the Bank’s Group, in all parameters viz. Core capital, Assets, Deposits, Loan Book and operating income”, stated Mr. Ponda, the Group Acting CEO at the press conference held at Bank’s Head Quarters, Exim Tower Dar es Salaam.
Resulting out of bank’s core focus on technology and digitization, the Bank has recently rolled out its very distinctive ‘Omni Channel Electronic Banking’ offering for its Retail, SME & Corporate Customers. A unique omni experience, agnostic to any electronic device. A sound, safe and differentiated experience to the customers.
Within a short span of 20 years of its existence, the bank has built a strong brand through its geographical reach, innovative products, relationship management and its ability to provide a faster turnaround in services and in the process building a strong loyal customers base.
Partnering TANAPA, the bank has been a pioneer in introducing automated collections at its coveted national parks. Not only that the bank has now been providing automated collections at all the national parks of TANAPA across the country but has also now enabled on-line generation of permits and collection of fees. The service so rolled out by the bank has been very well received across the entire fraternity of the tour operators, besides accolades from the Agency itself.
In 2017, the Bank further expanded its presence as part of its strategy to grow its distribution footprint at locations that brings it closer to its customers, while offering a refreshing banking experience. The Bank now has 46 branches across its network; 33 in Tanzania, 6 in Comoros, 2 in Djibouti and 5 in Uganda. In addition to its branches, the Bank has 78 ATMs, 7 MoneyGram counters and 3 Teller Implants across the Group.