Tanzania: NMB Pays 21.8bn/ - in Dividend to Govt

NMB Bank Plc, the country's most profitable bank yesterday made a 21.8bn/- dividend payout to Treasury, which has enabled the government to garner over 155.8bn/-in 15 years from its investment.

Speaking before handing over the dummy cheque of the new payout in Dodoma to Vice President Dr Philip Mpango, the bank's Chief Executive Officer, Ms Ruth Zaipuna, said NMB has already deposited the amount in national coffers ready for use and investment in development projects.

"NMB is one of the government's privatised companies that has been making profits consistently for the past 15 years. NMB Bank, in this period has paid over 155.8bn/- in dividend to the government," the leading financial services provider in the country said in a statement.

Ms Zaipuna said the total dividend to the government for 2020 was a 43 per cent increase over what was remitted in the 2019 following the bank's extraordinary performance during the year that set many in-house and sectoral records. These, she explained, included a super net profit of 206bn/- that also broke the previous NMB profit after tax record of 155bn/- that had been set in 2014.

According to her, the increase in the dividend paid to the government is a clear indication of the bank's productivity ability and efficiency capacity to serve the country better, deliver value added benefits to shareholders and make a difference in people's lives.

"In 2020, NMB Bank set an operational precedent in Tanzania's banking sector after the its net profit shot up by 45 per cent and reached 206bn/-, compared to 142bn/- attained in 2019, thereby setting a historic milestone in the banking sector in the country," Ms Zaipuna noted in her speech.

She added that the bank did not clinch the number-one slot in profit making only during the year but also in various other competitive perimeters such as emerging tops in the size of the balance sheet that soared to 7tri/. NMB also led the pack in clients' deposits with 5.3tri/- as its capital base also climbed to 1.1tri/-.

Its operational efficiency was equally superb as it recorded an industry-best 51 per cent costto-income ratio. On June 4, 2021, at the Annual General Meeting held online, NMB shareholders approved a total of 68.5bn/- dividend payout, equivalent to 137/- per share of which 21.8bn/- has been paid to the government for its 31.8 per cent stake in the business.

Other NMB shareholders have also been paid dividend, including Arise B.V, the largest shareholder who has received 23.9bn/-from their 34.9 per cent shareholding.

"In addition to the dividend, NMB Bank paid over 245bn/- to the government in 2020 as taxes ranging from PAYE, Corporate Tax, Skills and Development Levy, Excise Duty and VAT on services," Ms Zaipuna noted.

Speaking after receiving the hefty payout, Dr Mpango said NMB was indeed worth the investment the government made in the business since the economic value it was delivering goes beyond monetary value. Citing the 1.4bn/- the bank invested in social projects as part of its corporate social responsibility (CSR) activities, he called on other entities in which the government has shares to emulate the NMB case.

However, Dr Mpango challenged the bank to deliver more value in the future since it has the financial muscle and innovative capacity to do so.

"NMB is leading by example, this is the third time I am receiving dividend from NMB Bank, two years while I was the Minister of Finance and Planning and the first time as the Vice President," Dr Mpango said.

"If other entities did the same as NMB on dividend, we would witness a great improvement in the provision of social services for Tanzanians and contribute to the various strategic government projects in progress," he added.

On his part, NMB Bank's board chairman Dr Edwin Mhede thanked the government for creating a conducive business environment through progressive fiscal and monetary policies that continue to make the bank profitable and enable it to deliver accordingly.

He said the new dividend payout to the Government reflects consistent delivery of strong returns to the bank's shareholders and value-creation to stakeholders as NMB continues to transform lives.

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