Bank M (Tanzania) Limited, has recorded almost double its net interest income on the back of liquidity tightness and high interest rates in the market in the first half.
The bank's net interest income in the first six months of this year has shot up to 9.34bn/- compared to 5.51bn/- of similar period last year despite tight liquidity position and galloping inflation.
A statement issued by the bank yesterday said in the same period, the bank recorded a significant increase in Non Funded Income from 3.05bn/- to 6.22bn/-, a clear reflection of acceptance of its service delivery standards.
Jacqueline Woiso, the head of banking transaction said the statement that the increase in income which does not depend on interest shows that customers have firm confidence towards the banking products and services.
"We have made great strides in our performance and this is solely because of our enhanced service delivery and professional practices which make our customers to take Bank M as their preferred choice," she said.
The recently released financial statements of the bank, shows that Non Interest Expenses increased to 8.76bn/- from 5.73bn/- with a big chunk going to salaries and other staff benefits that consumed over half of the Non Interest Expenses.
This achievement in the first six months did not end up at the income generation but also in profitability as the pre-tax profit almost tripled to 6.55bn/- as per recently released financial performance of the bank for the 2nd quarter of this year, it said.
The profit growth implies that the bank will surpass its profitability level registered last year and enhance its presence in the top list of commercial banks in the market, despite being in the market for slightly over four years, it added.
According to the statement there was growth in pretax profit to prudent loaning as the bank continues to maintain low levels of NPLs (Non Performance Loans) to total loans and advances which also signify high quality in terms of asset management.
Explaining further, she said the bank's Non Performing Loans (NPL) as a percentage of total loan stands at 2 percent since last year's third quarter and has not set aside fund for doubtful debts for the period.
Meanwhile despite the low ratio of NPLs, the bank took no chances and put on provision for impairment losses on loans and advances of 246m/- compared to zero amount last year, she said.
Alongside the spurt in net interest income generated from loans, the Non-Interest Income has also grown significantly to 6.22bn/- in the first half against 3.05bn/- of previous year.
The loan book of the bank also grew to 240.05bn/- to push up total assets to 335.92bn/- from 312.23bn/- of the previous quarter of the year.
"We have managed well our loan book because of careful evaluation of risk which is also reflected in the sectoral exposure of the bank's loan portfolio which is well diversified with risks well spread across all the sectors of the economy," she commented.
The bank has also recorded similar overwhelming achievement in deposits with its total deposits climbing to 285.03bn/- in first six months of this year compared to 272.53bn/- it has managed to mobilise in 12 months of last year.
Bank M has continued it's stance as a standard setter in transparency by publishing in-depth additional disclosures to its financial statements, it said.
This is basically extra information on key financial and performance indicators that is not mandatory to be published under the central bank's guidelines, it said