NMB Bank PLC - NASIRA PORTFOLIOStatus: Approved investment
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Who is our customer
NMB Bank Plc. (“NMB”) is one of the largest commercial banks in Tanzania, providing banking services to individuals, MSMEs, agribusinesses and corporates. NMB has an extensive network of agents, branches and ATMs spread across Tanzania and is enabling access to finance to end clients across the country.
What is our funding objective?
FMO is providing a USD 11 mln NASIRA Risk Sharing Facility (with a possibility to top-up to USD25million within 1 year of effectiveness). The facility will be geared towards NMB’s loans to MSMEs with a specific focus on the agriculture value chain being a key driver of the Tanzanian economy.
Why do we fund this investment?
NMB plays an important role in contributing to financial inclusion by serving the MSME segment that has difficulties in getting loans from financial institutions. The Risk Sharing Facility (RSF) will help the bank expand its business with MSMEs with a particular focus on MSMEs led by women, youth and operating in the agriculture sector. These clients often have a higher risk profile and have limited access to collateral and credit histories, which limits their ability to access financing. By sharing in the credit risk for the underlying loan portfolio, FMO will be helping NMB to offset the increased risk and enable them to further grow their loan portfolio and increase the financing for MSMEs.
What is the Environmental and Social categorization rationale?
The client is categorised as E&S Category A in accordance with FMO’s Sustainability Policy and based on the overall loan portfolio for NMB and their increasing exposure in the corporate sector. To tackle the increased E&S risks, an E&S Action Plan has been developed and agreed upon as part of the recent senior loan facility. Although, the underlying portfolio covered by this NASIRA facility will have lower E&S risk given the focus on MSMEs and low loan sizes to end-clients, the overall categorization and the same requirements will apply to the client.
|Date||Total FMO financing|
|2/22/2023||TZS 23294.70 MLN|
- Website customer/investment
- Tanzania, United Republic of
- Financial Institutions
- Publication date
- Effective date
- Total FMO financing
- TZS 643.50 MLN
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C)