NBC recovers from loss, posts 6bn/- profit

National Bank of Commerce (NBC), one of the largest banks in the country, recovered from the red, posting a net profit of 6.41bn/- last year, thanks to reduction in bad debts written off.

The bank suffered 5.68bn/- loss in 2011 due to bad debts that were written off at the tune of 56.55bn/- and a substantial amount set aside for impairment losses of 55.81bn/-.

Last year the bank attributed its profit to net interest revenue that increased to 93.3bn/- compared to 85.94bn/- of the previous year while non-interest and other revenues contributed 55.13bn/- and 52.64bn/-, respectively.

The bank also managed to cut down expenditure to 128.06bn/- from 137.41bn/- of 2011, after closing a branch to reduce its workforce by 101 to 1,340. 

This managed to amplify it profitability level. In last year’s second quarter, bad debts chocked the bank to post a huge loss of 20.2bn/- which was the highest since the privatization of NBC and liberalization of the banking sector.

The bank attributed the mid year losses to corporate impairment losses amounting to 13.9bn/- and provisions of 13.7bn/- raised for cost and under accruals from 2008 to June 2012, relating to technical assistance provided by a parent company abroad.

Last year, however, NBC non performing loans (NPLs) stood at 117.4bn/- being 16.8 per cent of total gross loans issued up to the end of last December.

Assets grew from negative 0.36 per cent to 4.33 per cent, translating to 1.508tr/- at the close of the year while deposits also increased from negative 1.77 per cent to 3.49 per cent or 1.266tr/-.

Due to NPLs, the bank restricted its loaning out slightly from 56.9 per cent to 54 per cent equals to 653.01bn/-. 

NBC is one of the oldest banks in Tanzania, marking 45 year of experience in providing financial services. It offers conventional services through an extended branch network and ATMs.
Source: The Daily News, www.dailynews.co.tz, reported by Abduel Elinaza in Dar es Salaam 
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