Roadwin Chirara
7 April 2006
FINANCIAL services group Premier Banking Corporation (PBC) says it has no immediate plans to venture into mainstream commercial banking.
The company's group chief executive officer, Exodus Makumbe, said commercial banking was not currently part of the company's strategic focus.
He said the company was focusing on growing its merchant banking division, which it only started operating in November last year.
"We have no plans for commercial banking activity," said Makumbe. "We are focusing on growing our company's brand and merchant banking business."
He said the commercial banking sector was currently not conducive for any new entrants. He said the turbulence in the economy was proving a challenge to the financial sector thus discouraging new entrants.
"There has been so much happening in the sector and this has led to the decision to first establish the company as a strong financial player," said Makumbe.
He said continued distinction between merchant and commercial banking might in the long-term provide a opportunity for the company to explore other services for its customers.
"What is critical is the service offered as an institution and this determines the survival of the company in the long term," said Makumbe.
He said the company would keep searching for exciting opportunities in the long-term. "We are a financial entity and we will consider any opportunities that might be presented to us," said Makumbe.
He said as part of growing its merchant banking division, the company was planning to open more branches.
"We are going to be opening more branches for our merchant banking divisions and this is permissible under the Banking Act," he said.
Premier's decision comes after another financial services company, African Banking Corporation last year announced that it would not be venturing into commercial banking locally.
The company's group chief executive officer, Douglas Munatsi, said he had realised the lack of significant returns by entities that had taken up commercial banking.
"Most, if not all, have failed to make any money in commercial banking," said Munatsi then.
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