news - FMO arranges a USD 65 mln loan agreement for NMB in Tanzania

A delegation of the Dutch Parliament was present at the signing ceremony in Tanzania

On 20 august 2013, National Microfinance Bank PLC (NMB) signed a USD 65 million loan agreement in a transaction led by FMO, the Netherlands Development Finance Company, in cooperation with DEG, the German Development Finance Company and EFP (European Financing Partners SA), a group of 14 other European Development Finance Institutions.

In this transaction NMB will be able to obtain a senior unsecured long term loan in US Dollars, to support the working capital and investment needs of the bank’s growing private sector customer base, including large corporates, SME’s and agribusiness. FMO will provide an amount of USD 32.5 million, DEG will provide USD 20 million, and EFP will provide USD 12.5 million.

Says Mark Wiessing, the CEO of NMB: “ NMB lends to most key sectors in the growing Tanzanian economy. An increasing number of customers is looking for longer term funding in US Dollars, to support their business and investments. We intend to support these customers with their foreign currency financing requirements, but also by accelerating the rollout of other foreign currency based services such as trade finance and letters of credit, foreign exchange trading, and foreign currency accounts, which are available throughout our network of 150 branches”.

NMB Chief Financial Officer, Mr. Waziri Barnabas added: “ NMB is already one of the strongest and healthiest banks in the Tanzanian banking sector, as evidenced by our financial results. Through this facility from FMO and DEG we will be able to match the currency and tenor of our funding sources with our customers’ foreign currency financing requirements, thus further improving the quality of our balance sheet”.

The signing ceremony was held in the presence of the Deputy Head of Mission and Charge d’Affaires of the Dutch and German Embassies respectively, and a visiting Parliamentary Committee on Foreign Affairs and Development Cooperation of the Netherlands, currently on a mission to Ethiopia and Tanzania.

Mrs. Marleen Jansen, the Investment Officer - Financial Institutions for FMO in Africa commented that this transaction is the largest loan that FMO has ever concluded for a financial institution in Tanzania. She added that NMB have a convincing financial track-record and a strong management team and shareholder base, and the transaction is also evidence of FMO’s confidence in Tanzania as a whole. She added: “These facilities are intended to support NMB’s Tanzanian private sector customers, including SME’s and agribusinesses, who are the real engine of economic growth for the country”.

About NMB:

 NMB is the leading bank in Tanzania, with over 1.8 million customers, 150 branches and 500 ATM’s. NMB pioneered major innovations in Tanzania, including NMB Mobile (mobile payments), Pesa Fasta ( a remittance product targeted at the unbanked) and Chap Chap (a low cost account with  biometric features and access to all the bank’s branches and alternative channels). NMB recently integrated its payment services with M-Pesa, allowing its customers access to over 30,000 M-Pesa agents for their remittances and cash-in and cash-out requirements.

NMB is also making inroads in Wholesale Banking, Treasury and Transactional Services such as payments, collections, trade services and foreign exchange. NMB plays an important role in the agricultural value chains of key export crops such as tobacco and cashew nuts, and pioneered warehouse receipt financing. NMB also supports the Government of Tanzania (GOT) with banking services through all its branches, 60% of which are in rural areas. NMB is one of the largest private sector contributors to Government revenues in the form of income taxes, PAYE taxes and skills development levies.

NMB is listed on the Dar Es Salaam Stock Exchange, and is owned 32% by GOT, 35% by Rabobank of the Netherlands and the balance is owned by the Tanzanian public.  The bank reported a net profit after tax of TZS 97 billion or approx. USD 60 million in 2012, on TZS 2.8 trillion or USD 1.75 billion in assets. NMB was voted “Best Bank in Tanzania” in Euromoney’s July 2013 Global Awards for Excellence ceremony in London.

www.nmbtz.com

About FMO:

FMO (the Netherlands Development Finance Company) is the Dutch development bank. FMO supports sustainable private sector growth in developing and emerging markets by investing in ambitious entrepreneurs. FMO believes a strong private sector leads to economic and social development, empowering people to employ their skills and improve their quality of life. FMO focuses on three sectors that have high development impact: financial institutions, energy, and agribusiness, food & water. With an investment portfolio of EUR 6.3 billion, FMO is one of the largest European bilateral private sector development banks. www.fmo.nl