MBCA gets $75 million from Nedbank

Published: 19 July 2013

MBCA Bank has secured US$75 million from majority shareholder, Nedbank Group of South Africa, to provide lines of credit to Zimbabwean companies.

MBCA managing director, Charity Jinya, last week told The Financial Gazette that the funds would be used for lending to the agricultural and mining sectors.

"MBCA Bank received a composite line of credit from its parent company Nedbank South Africa amounting to US$75 million. The funds will assist in meeting the requirements of the bank's agricultural and mining sector clients," said Jinya.

Nedbank, South Africa's fourth largest bank by market capitalisation and customer numbers, holds a controlling 74 percent stake in MBCA Bank.

Banca de Credito Finanziaio of Italy and Rothschild & Sons of the United Kingdom are the other two offshore partners who own 10,5 and 3,26 percent shareholding in the financial services firm respectively.

Old Mutual Zimbabwe Limited owns 18,30 percent while employees have a stake through a Share Trust controlling 0,66 percent.

MBCA Bank is one of the four foreign-owned banks under pressure by government to cede majority shareholding to locals under the contentious indigenisation law put in place in 2007.

Jinya recently said negotiations with government were on-going for a deal on the indigenisation process, revealing that parties were yet to reach a deal agreeable to all parties.

In its financial results for the year to December 2012, MBCA Bank reported a 48 percent rise in profit after tax to US$4,96 million, up from US$3,36 million in the prior year.

The solid performance was attributed to improved net interest income which increased by 37 percent on the back of increased loan utilisation throughout the year.

Costs to income ratio dropped to 68 percent from 79 percent achieved in previous year. The loan book increased by nine percent to US$88,19 million during the period under review.

The bank managed to underwrite a good loan book as evidenced by a loan impairment provision of 1,7 percent slightly up from the 1,5 percent recorded in the previous year.

MBCA Bank, Zimbabwe's first-ever merchant bank, was incorporated in 1956 as the Merchant Bank of Central Africa.

It then converted to a fully-fledged commercial bank and adopted the name MBCA Bank in 2004.
- fingaz