Africa Banking Capital Market FDI Finance M&A Tanzania

South Africa’s Arise now majority shareholder in Tanzania’s NMB Bank Plc

Arise, an African investment company has acquired 34.9 per cent of Rabobank shares in the Dar es Salaam Stock Exchange (DSE) listed NMB Bank Plc. Notably, NMB is one of the largest and most successful banks in Tanzania.

The buyout actually took place late last year when on 28 December 2020, having been approved by the Capital Market and Securities Authority (CMSA) in Tanzania for the transfer of 174,500,000 NMB Bank Plc shares owned by Rabobank to Arise.

The share transfer process was completed on 31 December 2020.

According to Arise Chief Executive Officer, Mr Deepak Malik the conclusion of the share transfer is a significant milestone for the company which partners with sustainable, locally owned financial services providers in Sub -Saharan Africa.

“The organization’s core mandate is to partner with local sustainable financial institutions to strengthen and develop effective, inclusive financial systems in Africa to contribute to economic growth and poverty reduction,” he said.

“Tanzania is a key investment destination in Sub-Saharan Africa for Arise and we are excited about the collaborative partnership with NMB,” added Mr. Malik noting that the partnership will further advance financial inclusion in Africa

In her comments, NMB Chief Executive Officer Ruth Zaipuna, said, “The successful completion of the share transfer is a testament of investors’ confidence on the Institution and the Country at large.”

”The collaborative partnership between Arise and NMB is envisaged to deliver substantial operational, commercial, organizational and financial benefits with long-term market returns that go beyond stakeholders’ expectations”, she added.

Also read: Tanzania to resume oil, gas negotiations after a yearlong stall

Assets & Profits: Meet Tanzania’s Largest Bank

If assets and profits are any measure to go by, then NMB is Tanzania’s largest bank.

Assets: In the third quarter 2020 financial results which placed NMB’s total assets at a record TZS 7.0 Trillion up from TZS 6.1 Trillion from in the third quarter in 2019.

Profits: NMB is also the most profitable bank in Tanzania, having recorded an impressive TZS 145 Billion net profit in the quarter ended 30 September 2020 up from TZS 82 Billion registered in 2019.

So what is to be expected of this partnership?

When you combine a company with a long term proven record in financial inclusivity like Arise with a bank that focuses on microfinancing like the National Microfinance Bank (NMB), then you undoubtedly have a a very promising and lucrative future of huge financial inclusion potential.

This long-term investment by Arise will only serve to support NMB’s future growth aspirations and spur economic growth and the prosperity of Tanzanian’s, through increased financial inclusion, and the growth of Retail, Small Medium Enterprises (SMEs) as well as the Agriculture sectors and related value chains.

With international operation background, it is also expected that Arise will not only support the growth and development of NMB but also foster access to international standards of best practice and expertise across an array of business areas.

“We are confident that this partnership will yield positive benefits for both NMB and Arise in the future”, concluded Mr Malik.

Arise aims to contribute to the economic growth in Africa and the prosperity of its people by increasing financial inclusion, employment, strengthening rural development and in effect, nurturing poverty alleviation.

The company was founded by several cornerstone investors the likes of Rabobank, Norfund, NorFinance and FMO, the company currently manages assets in excess of USD 950 million and is operational in over 10 African countries.

NMB Bank Plc. (“NMB”) is a full-service commercial bank focused on 4 main business divisions: Retail, Wholesale, Agri and Treasury. NMB provides a suite of financial services and products to retail customers, farmers, SMEs, Corporates, Institutions, and the Government.

The bank has 225 branches, over 8,000 Agents (Wakala) and more than 700 ATMs across the country and is represented in all districts of Tanzania. NMB has over 4 million customers and employs over 3,400 staff. It is listed at the Dar Es Salaam Stock Exchange and its largest shareholders are the strategic partners Arise B.V with a 34.9% shareholding and the Government of Tanzania with a 31.8% shareholding.

Euromoney awards for excellence selected NMB as the “Best Bank in Tanzania” for 8 years in a row from 2013-2020. The bank has been named The Safest Bank in Tanzania for the year 2020 by Global Finance Magazine.

Notably, NMB Bank was also awarded as the Best Blended Finance Partner in Africa for banks working with International Finance Corporation (IFC) of the World Bank Group in 2019. Also, the Best Retail and Best Commercial Bank in Tanzania by the Banker East Africa Magazine in 2018.

Original article on The Exchange

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