Announcing the 92.16bn/- net profit earned during the year ending September 2019, CRDB Bank Plc’s Managing Director, Abdulmajid Nsekela said the extraordinary growth comes about because his management has focused on financing contract biding and guarantee for contractors and suppliers of major infrastructure projects.
“Performance guarantee and bid bonds have become very products for contractors and suppliers of major government’s infrastructure projects,” Nsekela who took over in October last year as the bank’s CEO said.
When he took over, CRDB had taken a hit in profits from 30.8bn/- in 2017 to 52.25bn/- last year before the latest profit spiralling to 92.16bn/-. “Our sustained growth has been championed by a committed staff, lowering of running costs and recovering of bad loans which had eaten into the bank’s profits,” Nsekela who is arguably one of the market’s youngest CEOs manning a mega bank, stated.
He said CRDB has played a role both in financing the ongoing state mega infrastructure projects in Standard Gauge Railway and Rufiji Hydro Electric Power Project (Nyerere HEP) in addition to bankrolling small and medium size enterprises.
The CRDB chief further stated that his management will continue focusing on trade financing because it is an area of rapid growth as demand for the product in the market is on growth path thanks to President John Magufuli’s administration’s focus on infrastructure development.
“We are convinced that this area of trade financing is of significance and will continue to invest heavily in this segment,” Nsekela added while emphasising that another area of focus remains financing SMEs.
Earlier this year, CRDB paired with United Bank for Africa to give a guarantee of U$730 million to the over 2,000 megawatts Rufiji hydro Power Project being undertaken by Egyptian Arab Contractors Limited and El Sewady Electric Company Elsewedy Electric with state power giant, Tanesco as client.
Among the highlights of the period include: the bank’s balance sheet which grew by 5 percent to 6.2trn/- from 5.9trn/- reported during the period last year; loan portfolio slightly grew by 2.5 percent to 3.25trn/- while deposits increased by 7 percent to 4.8trn/-. “Net interest income increased by 22 percent year on year to reach 389.66bn/- from 319.09bn/- reported in September 2018," Nsekela added.
The Tier 1 commercial bank continued to command a 22 percent market share of industry deposits owing to its robust network of 240 branches, 551 ATMs, over 2,400 Point of Sales (POS) terminals and 11,612 wakalas who increased by a whopping 7,260 year on year.
“Our focus on operational efficiency and sales optimization is paying off. We have embarked on the digitalization journey while adhering to good governance, reduce operational costs, and improve our service delivery. As you can see, our earnings from credit books, trade finance, and foreign currency dealings have significantly increased, showing our commitment to serving each segment in the market," the youthful CRDB boss added.