NMBZ Holdings, a prominent banking group, is currently negotiating three new lines of credit totaling US$75 million to support critical sectors of the economy, including agriculture.
While the banking group has not disclosed the specific sources of these funds, discussions are underway at various stages. This move follows a recent acquisition of a US$25 million loan from Proparco, a French Development Finance Institution. The Proparco facility is aimed at supporting small and medium-sized enterprises (SMEs), agriculture, women entrepreneurs, and local businesses involved in imports and exports.
In a trading update for the third quarter of 2024, company secretary Violet Mutandwa highlighted that the group, through its subsidiary NMB Bank, is focusing on securing external credit lines to help enhance the production capacity of Zimbabwean companies, addressing the capital gap.
Through a partnership with Rabobank, a global leader in food and agriculture, NMBZ is rolling out a value chain strategy designed to boost Zimbabwe’s agricultural sector. An in-depth study of the horticulture sector during the quarter revealed significant growth potential, especially in increasing access to export markets in regions such as the European Union, the Middle East, and the Far East.
The study also emphasized the need for specialized financing solutions tailored to the sector’s unique needs, helping both large-scale and smallholder farmers expand their operations.
The group is actively developing financial solutions to cater to the specific requirements of the agricultural sector and is focused on increasing its engagement in this area.
Additionally, NMBZ’s fintech subsidiary, XPlug Solutions, is leading the way in Robotic Process Automation (RPA) and digital transformation for financial institutions. XPlug’s services have been adopted by several major banks in the region, resulting in significant cost savings and improved operational efficiency.
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The subsidiary has also expanded its reach to five new countries: Rwanda, Uganda, Zambia, Mozambique, and Tanzania. During the review period, XPlug launched the Socket SMS Gateway, which has facilitated the sending of over 14 million SMS messages to customers, offering businesses an affordable and easy-to-use communication platform.
In terms of financial performance, NMBZ Holdings reported operating income of ZiG1.3 billion, reflecting a 10% increase from ZiG1.2 billion in the previous year. This growth was driven by a diverse range of products, higher transaction volumes, and a solid balance sheet.
The group’s balance sheet is supported by US dollar-denominated assets funded by offshore credit lines, which target productive sectors of the economy. Total assets for the period amounted to ZiG5.5 billion, representing a 39% increase from ZiG3.9 billion recorded at the end of 2023.
This growth was mainly attributed to higher levels of loans and advances, which reached ZiG2.7 billion, marking a 110% increase from the end of 2023. Notably, 90% of these loans were denominated in US dollars.
Deposits grew by 73% during the quarter, rising from ZiG1.4 billion at the end of 2023 to ZiG2.4 billion, with 87% of these deposits in US dollars.
NMBZ also reported a capital adequacy ratio of 30.92%, well above the regulatory minimum of 12%, underscoring the bank’s strong financial position and its ability to meet liquidity requirements.
Looking ahead, NMBZ plans to focus on its core business while expanding its presence both within Zimbabwe and internationally.
