Nedbank’s Zim unit indigenised

via Nedbank’s Zim unit indigenised – DailyNews Live 10 March 2015

HARARE – Nedbank Group Limited (Nedbank)’s Zimbabwean unit MBCA Bank (MBCA) has been indigenised in line with the country’s empowerment policy.

The bank – 74 percent owned by the South African Nedbank – said its empowerment compliance plan was approved by Zimbabwe’s Indigenisation ministry.

Although President Robert Mugabe’s government has hinted that indigenisation thresholds will be on a sectorial basis, the country’s empowerment policy – enacted in 2008 – compels foreigners to cede majority shareholding to black locals.

While he did not give detail on the compliance plan, MBCA chairman Richard Zireva said in the institution’s financials for the year to December 2014 that all the preliminary processes were completed last year.

He said the bank’s empowerment plan – which had been under discussions for over a year – “was approved… during the course of the year and implementation is underway”.

MBCA is one of the four foreign-owned banks required to comply with the indigenisation policy, aimed at empowering economically disadvantaged Zimbabweans.

The other foreign owned banks are British-owned Barclays Zimbabwe and Standard Chartered Bank of Zimbabwe, and Stanbic Bank – a unit of South Africa’s Standard Bank.

Last year, the Bankers Association of Zimbabwe (Baz) indicated that foreign banks were yet to comply with the indigenisation policy due to authorities’ delays in approving their compliance plans. – Business Live

This is despite government’s pressure for the institutions to conform with the law, with former Empowerment minister Savior Kasukuwere giving them numerous ultimatums.

In December, businessdaily gathered that Nedbank planned to rename MBCA to Nedbank Zimbabwe sometime this year.

Charity Jinya, MBCA’s managing director, neither denied nor confirmed the plan.

“It is currently too early to confirm our plans on rebranding. We will advise you once definitive plans are in place,” she said at the time.

This came as two years ago, MBCA embarked on a partial rebranding exercise by changing its predominantly blue colour to green, a colour also used by Nedbank.

Then, the bank’s spokesperson Dedrey Mutimutema said they were partially rebranding in line with Nedbank’s strategies.

“Our plan is to align our activities, make up, and design with the rest of the Nedbank group,” she said.

Meanwhile, MBCA posted a 33 percent increase in profit after tax to $5,4 million for the period under review on the back of a rise in net interest income.

Profit after tax for MBCA grew from the 2013 figure of $4 million.

“This increase was attributable to $2,222 million growth in net interest income on the back on increased lending to our customers. The bank’s total income grew from $22,617 million to $25,5 million representing a 13% increase from the prior year,” MBCA managing director Charity Jinya said in the same statement.

The group’s operating expenses grew at a lower rate at 7,4 percent resulting in an increase in profit, with the balance sheet for the group at $188,936 million from $179,689 million due to repayments from major customers in the period under review.

Loans and advances constituted 49 percent of the total balance sheet compared to the same period 2013. Loans deposit ratio increase to 67 percent from 59 percent in 2013.

Jinya also said the operating environment continues to be challenging due to low investment inflows, lack of competitiveness and low levels of productivity.

Meanwhile, MBCA posted a 33 percent increase in profit after tax to $5,4 million for the period under review on the back of a rise in net interest income.

Profit after tax for MBCA grew from the 2013 figure of $4 million.

“This increase was attributable to $2,222 million growth in net interest income on the back on increased lending to our customers. The bank’s total income grew from $22,617 million to $25,5 million representing a 13% increase from the prior year,” MBCA managing director Charity Jinya said in the same statement.

The group’s operating expenses grew at a lower rate at 7,4 percent resulting in an increase in profit, with the balance sheet for the group at $188,936 million from $179,689 million due to repayments from major customers in the period under review.

Loans and advances constituted 49 percent of the total balance sheet compared to the same period 2013. Loans deposit ratio increase to 67 percent from 59 percent in 2013.

Jinya also said the operating environment continues to be challenging due to low investment inflows, lack of competitiveness and low levels of productivity.