The National Bank of Commerce (NBC) has said that it will embark on a number of initiatives and projects that will see its operating model changing with a view to streamline its operations.
The initiatives are also aimed at improving risk management and control environment that in turn will give sustainable growth in the market.
A press statement issued by the bank in Dar es Salaam yesterday said the changes are also aimed at improving customer service delivery.
It is of the view that, the year end cumulative position will be even better, the statement said.
It further said this year the bank’s profitability has been negatively impacted by very high levels of nonperforming loans resulting from the famous 2008 global financial crisis which affected both its corporate and retail loans thus forcing it to apply very prudent and stringent impairment policies.
NBC remained resilient in its performance turning around after a difficult first half of the year to deliver and impressive performance for the quarter ending September 30, 2012, the statement noted.
The bank recorded a profit before tax of 5.9bn/- compared to a loss of 20.0bn/- recorded during the second quarter of 2012.
Lawrence Mafuru who is the bank’s Managing Director said in the statement: “Our third quarter profit after tax stands at 4.2bn/-, reducing our nine months cumulative loss to 10.6bn/-.
This is mainly attributed by improved interest and non-interest income streams during the quarter under review.
The main contributor of this positive outlook comes from impairments line that have gone down quite substantially following aggressive measures taken by the bank to remediate its nonperforming assets.
Mafuru added: “We would like to thank our customers for their continued support and also assure them and the general public that our business is solid and the outlook is positive.”
The reported losses during the first half of the year were mainly driven by unusually large impairment items from specific big borrowers, some provisions raised for cost and prior year under accruals related to IT costs and technical assistance provided by our parent company, ABSA Group, in South Africa. These are one-off items and have since been normalised”.
Despite all the challenges and global economy slowing down, NBC’s balance sheet remained resilient quarter on quarter, with good growth recorded in debt securities/investment book compensating the shrinkage in lending book due to a tight stance that has taken in private credit expansion to allow for its balance sheet cleaning, it said.
The shrinkage into our customer deposits has largely been driven by huge quarterly pay-out mainly being taxes and our conscious decision to let go expensive institutional deposits, it added.
NBC remains to be an important player in the country’s financial services sector with 45 years of experience in the Tanzanian local and regional market, it said.
It has a lead position in offering conventional and Islamic banking services through an extended branch network and ATM foot print.