Postal Bank posts 3.8bn/- historic profit

Mr Moshingi
The Tanzania Postal Bank (TPB) has declared a land mark pre-tax profit of 3.8bn/-, which is an increase of 338 per cent in 2011, thanks to prudent spending and lending.

The historical profits came at a time when the global and the country's economic activities slowed down last year. The inactive period also saw the country's GDP dropping to 6 per cent.

TPB Chief Executive Officer  and Managing Director, Mr Sabasaba Moshingi said the achievement is attributed to increased line of business that helped to significantly up revenues and cut down unnecessary spending.

“Far-sighted lending has enabled the bank to contain non-performing loans to 2 per cent level which is well below the industry rate of 6.9 per cent,” Mr Moshingi told reporters yesterday.

The CEO said the historic profit compared to 0.8m/- generated last year was also a result of customers' growing confidence.  He said the pre-tax profit goal for 2011 was pegged at 3.5bn/- but  went up to 3.8bn/- despite a number of challenges last year.

“We are aiming to post a pre-tax profit of 4.5bn/- than this year and we are sure of reaching the target,” Mr Moshingi said, adding:

“We could  have done much better but we are currently investing on renovating our branches as well.”   

He named  lines of business that contributed massively on the profits  as direct customers loans, government securities and  commission paid by the Tanzania Revenue Authority (TRA) for collection of taxes.

This, according to the financial statement, saw income generated from loans revenue (net interest income)  climbing from 11.02bn/- in 2010 to 14.19bn/- in 2011.  Fees and commissions also grew significantly from 5.24bn/- to 6.62bn/- in the year under review. 

Earnings from lending were pushed by the increased amount of loans and advances to customers that reached 66.03bn/- at the end of last year compared to 64.64bn/- in 2010.

This enabled the bank’s assets to grow by 12 per cent to reach 136.24bn/- at the end of 2011.  The bank’s deposit base increased by 13 per cent to hit the 120.9bn/- mark at the closure of the books in December, last year. 

Majority  of the bank's clients are low income earners who  are about  90 per cent of the  total customers’ base. In 2011, the bank's client base grew up from 20,000  to 602,000 customers. 

TBP is one of the oldest banks in the country. It was found in 1925 and became operational in 1927 as Tanganyika Posts Office Savings Bank (TPOSB). 

Following financial sector reforms in the late 1980s, Tanzania Postal Bank (TPB) was established as successor of TPOSB following the Act of Parliament in 1992.    Since 1992 it became an independent institution from the defunct Tanzania Posts and Telecommunication Corporation (TP&TC).
Source: The Daily News,http://dailynews.co.tz,reported by Abduel Elinaza
Share on Google Plus

About Abduel Elinaza

This is a short description in the author block about the author. You edit it by entering text in the "Biographical Info" field in the user admin panel.