NBM strategic plan working, profit up 68%
National Bank of Malawi (NBM), which has posted a 68 percent profit growth to K12.7 billion from K7.5 billion, says with its capital, resources and agility, it will continue to walk on a growth path.
The listed bank’s share value has risen from K55 to K215 per share at the end of 2013, according to the financial results published yesterday.
The bank’s foreign exchange earnings increased partly due to the turnover as a result of improved availability foreign exchange on the account of high donor funds in flows.
This year, the bank will pay a final dividend of K2.9 billion, representing K6.20 per share which will be payable after its June 2014 annual general meeting.
According to a statement accompanying the results jointly signed by NBM chief executive officer George Partridge and board chairperson Matthews Chikaonda, the equities desk performed very well as the stock market recovered and experienced significant price gains in a number of counters which reflected a positive business environment.
Despite the good performance, the bank said it faced liquidity challenges in the industry for a couple of months which resulted in higher cost of funding with money market income surpassing expectations.
“The operating environment in the banking sector was characterised by liquidity challenges especially in the first half of the year as a direct result of the Reserve Bank of Malawi’s continued tight monetary policy stance exercised through mopping-up operations and the maintenance of high interest rate regime. This environment constrained new lending,” said the statement.
Going forward, the bank has said in the immediate term, they envisage a continuation of the declining trend of inflation and stability in the exchange rate, at least within the tobacco selling season.
However in the medium to long term, said the statement, the growth of the economy will depend on the policies to be adopted after the May 2014 general elections and the speed and level at which budgetary support and confidence are restored.
The bank is implementing a five-year strategic plan which is in the second year of implementation.
