NBS Bank has trimmed its loss by 74 percent to K1.1 billion in the year ended December 31, 2017, the bank’s financial report reveals.
The bank has trimmed the losses from K4.3 billion in 2016. This feat has changed the narrative in the banking circles on the prospects of the bank’s survival as many people speculated that the Malawi Stock Exchange (MSE)-listed bank would struggle to continue doing business and was on the verge of collapse.
NBS Chief Executive Officer, Kwanele Ngwenya was upbeat, stating that the bank is solidly on transformation path and will soon start posting positive results.
“The bank’s turnaround was largely affected by inadequate capital which had a negative impact on our ability to grow revenue. We, therefore, were primarily focused on recapitalization in the first half of the year. As you know, this was achieved through a successful rights issue through which we raised K11.8 billion,” he said.
Rights issue is an issue of shares offered at a special price by a company to its existing shareholders in proportion to their holding of old shares.
Following the recapitalization, NBS Bank is gaining traction in implementing its five-year strategy, recording a growth in total assets of 36 percent year-on-year which, according to Ngwenya, was driven by customer deposit growth of 15 percent.
“The growth in deposits is a result of the loyalty that our customers have in the bank. “The five-year plan involves a complete review of our systems and processes to ensure that we are more responsive to customers,” he said.
Ngwenya said the fruits of human capital investment in terms of recruitment and training will start bearing fruits.
He said their partnership with Rabobank—a technical partner from The Netheraland—gives the bank access to world-class banking skills and practices.