NMB in bid to finance key sectors of economy

NMB Zimbabwe is partnering with the Government and international financial institutions to enhance its credit lines in a bid to finance key sectors of the economy. In the 2023-24 summer cropping season, NMB has financed 7 100 hectares of maize and soya beans through primary producers, agro-dealers and seed houses.

In a statement accompanying its consolidated financial results for the year ended December 31, 2023, NBM Bank said raising of credit lines remains a key focus area as it continues to fund export-oriented productive sectors of the economy as part of its drive to support the growth of the Zimbabwean economy.

The bank’s chief executive officer, Mr Gerald Gore, said despite the highs and lows in the macroeconomic environment, the business banking division remained a reliable partner to businesses.

“The bank focused on enhancing its financial intermediation role as we secured medium to long-term funding for key sectors of the economy through offshore lines of credit,” he said.

“The bank partnered with Rabobank, one of the world’s leading Food and Agriculture Bank on a three-year food and agriculture support programme.”

He said this should assist NMB Bank grow the Agribusiness Unit as they contribute significantly to this key economic sector.

“Further, NMB Bank partnered with the Government of Zimbabwe through the National Enhanced Agriculture Productivity Scheme (NEAPS) and financed 7 100 hectares of maize and soya beans in the 2023 summer cropping season through primary producers, agro-dealers and seed houses.

“Loan book quality remains strong on the back of proactive monitoring and maintaining of close relationships with all customers,” he said.

Mr Gore said the Group has capabilities to take advantage of the opportunities presented by the environment and manage the related risks.

“The Bank was successful in raising lines of credit in the previous year and we are looking forward to accessing more funding. The Group diversification drive will gather momentum in the coming year as we fully operationalise the new subsidiaries.”

In June 2022, NMB launched a US$13,4 million European Investment Bank (EIB) facility to assist Bulawayo businesses that are involved in exports and expressed eagerness to scale up funding to capacitate their ventures.

The EIB extended the loan to NMB Bank as part of its private-sector lending initiative for Zimbabwe.

The loan facility, which has a tenure of seven years, is available in United States dollars through the existing NMB branch network and it is in the form of short, medium, or long-term.

The bank is working on supporting the private sector, including exporters in key areas of the economy with the right type of funding and the focus of the funding facility is to support agriculture, horticulture, and manufacturing exporting clients.

Zimbabwe has been recording growth in exports and this comes following the Second Republic led by President Mnangagwa’s intensified efforts to steer export-led economic growth and inclusive participation in industrialisation.

Meanwhile, NMB Bank said its property unit which was established last year, has been mainly focused on projects within the investment property portfolio of NMB Bank Limited.

Mr Gore said this is over and above the 26 cluster housing project at Reoville Homes, which the company completed in 2023.
“NMB Properties, working with a number of partners has a project pipeline for 2024 that includes cluster housing developments, residential stands and a shopping centre. The establishment of NMB Properties has positioned the group for sustained growth in the real estate sector,” he said.

The real estate sector is in a growth trajectory as investors, businesses and individuals sees the property sector as a store of value.
This has seen the private and public sector coming up with different initiatives, which include the launch of the Real Estate Investment Trust (REIT) Association by the Zimbabwe Stock Exchange last year in a bid to promote growth of the sector.

According to the NMB consolidated financial results for the year 2023, the bank achieved a total comprehensive income of $327,6 billion, which was a 444 percent increase compared to $60,3 billion for the previous year.

Fees and commission income grew by 210 percent and the bank said this was largely earned through their various digital platforms. Cost to income ratio was 35 percent, down from 45 percent the previous period.

“The deterioration in the exchange rate as well as inflationary pressures continue to push the cost of doing business upwards and we continue to mitigate this through continued focus on digitalisation, automation of processes and improved efficiencies.

“Given the macroeconomic environment, the group continued to forge ahead with value preservation strategies and focus on hard currency income streams,” said Mr Gore. — chronicle