NMB Bank Limited is targeting a non performing loan (NPL) ratio of 10 percent by December 2015, a 17,7 percent decline from last year.
Speaking at the bank’s financial results for the year to December 2014, NMB Holdings’ chief executive officer Benefit Washaya said: “The bank made significant debt recoveries in 2014 and will continue to intensify its recovery efforts in 2015 in a bid to reduce the non-performing loans. Our automated end-to-end credit management system is now in place and this has improved the quality of credit appraisals… We are targeting an NPL ratio of 15 percent by 30 June 2015 and 10 percent by 31 December 2015.”
He said the bank had negotiated for a US$71 million line of credit and was presently in the process of negotiating with other potential funders to raise an additional US$20 million that would bring total credit lines to US$91 million.
In the period under review, the group recorded an attributable profit of US$1,6 million compared to a loss position of US$3,3 million in the prior year.
NMB Bank kept its non-performing loans under check, resulting in impairments dropping to US$5 million from US$16,6 million in 2013.
Interest income declined to US$31 million from US$33 million while interest expenses also dropped to US$12,6 million from US$13 million.
The bank said improvement in the operating results were underpinned by current efforts being made by the group to contain non-performing loans, implementation of a new credit system and the repositioning of the bank in the financial services sector.
Total income was four percent down on prior year at US$48,07 million from US$50,1 million the previous year.
The bank’s liquidity ratio closed the year at 32,38 percent and was above the statutory requirement of 30 percent.
Commenting of capitalisation, Washaya said the plan was to achieve tier one status with a core capital of US$100 million by December 31, 2020.
“We continue to look for reasonably priced credit lines which will allow the Bank to underwrite more good quality loans,” he said.
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