Dar es Salaam. Exim Bank Tanzania has completed the acquisition of assets and liabilities of First National Bank (FNB) Tanzania Limited as it ups its expansion plan domestically and regionally.

The move comes almost nine months after Exim Bank Tanzania signed the offer to acquire certain assets and liabilities of FNB Tanzania on October 26, 2021.

The signing paved the way for regulators to start scrutinising the deal, compelling the Fair Competition Commission (FCC) to start looking for stakeholders’ inputs through its January 10, 22 public announcement.

Exim Bank’s Chief Executive Officer (CEO), Mr Mr Jaffari Matundu, said at the weekend that regulators, including the Bank of Tanzania (BoT), have okayed the deal and that clients with FNB are now banking with Exim Bank.

This is the second acquisition by Exim Bank Tanzania after that of UBL Tanzania which was sealed three years ago.

“We are excited to welcome former FNB Bank customers to the Exim family,” he said at the weekend.

Exim Bank Tanzania was established almost 25 years ago. It has since expanded to the Comoros, Djibouti, Uganda and Ethiopia, boasting a total of Sh2.4 trillion in asset size throughout the region.

According to Mr Matundu, Exim Bank generated a pre-tax profits of Sh18 billion during the first half of the current calendar year, up from only Sh6 billion that was registered during a similar period last year.

Total assets reached Sh1.5 trillion from Sh1.3 trillion over the past year while consumers’ deposits rose from Sh780 billion at the end of June last year to Sh943 billion in June this year.

Mr Matundu attributes the growth to a conducive environment that the banking sector was currently working in which was in line with President Samia Suluhu Hassan’s pro-business policies.

Commercial banks and saccos added an average margin of 4.5 percent on funds obtained under a State-backed affordable housing plan, according to the Kenya Mortgage Refinance Company (KMRC).

Seven financial institutions got Sh1.34 billion from KMRC after it started disbursing funds for onward lending to home buyers last year, the firm says in its annual report for 2021.

The mortgage refinancing firm, incorporated to derisk access to home loans for workers earning up to Sh150,000 a month, offers funds to banks and saccos for onward lending at an annual interest of five percent.

The recipient lenders are, in turn, expected to lend out the cash to home buyers for single-digit interest rates.

“The average lending rate is 9.5 percent per annum fixed for the tenor of the (home) loans,” KMRC told the Business Daily in regard to funds disbursed last year.

The rate is lower than the average commercial bank lending rate of 12.2 percent as of May.

Prospective home buyers who qualify for home loans under the KMRC framework access up to Sh4 million for property in the Nairobi metropolitan area and Sh3 million elsewhere, with a repayment period of up to 20 years. The KMRC funding covered 574 home loans last year, putting the average mortgage size at Sh2.34 million.

The overall industry’s average mortgage size last year increased to Sh9.2 million from Sh8.5 million previously, the Central Bank of Kenya data shows, locking out low- to mid-income workers from a thin market of 26,723 home loan accounts worth Sh232.7 billion.

Co-op Bank, which accounted for 5.6 percent of the residential mortgages market last year, tapped the highest amount from KMRC at Sh550 million, followed by HFC (Sh515 million).

Others were Unaitas Sacco (Sh116m), Stima Sacco (Sh69m), Credit Bank (Sh52m), Tower Sacco (Sh30m), and Ukulima Sacco (Sh12m).

“The focus for KMRC is to help drive down the rates so that we have low rates and longer tenors. So we are trying to help people who are at lower income levels to get financing for housing,” KMRC chief executive Johnstone Oltetia said earlier.

UGANDAN Minister of State for Works and Transport, Mr Byamukama Fred has expressed his country’s readiness to strengthen business cooperation with Tanzania, following notable improvements in transport infrastructure in the Central Corridor.

He made the remarks mid this week during his tour of Isaka Dry Port in Kahama District of Shinyanga region and Mwanza South Port in Mwanza region, to see the businesses conducted in the Central Corridor.

The minister was delighted with implementation progress of the projects at Mwanza South that include construction of the new ship – MV Mwanza Hapa Kazi Tu and rehabilitation of MV Umoja cargo ship.

“These are multi- billion projects, which will serve not only Uganda and Tanzania but also other neighbouring countries.

Marine transport ensures safety of the cargo and timely delivery,” he said.

Improvements in marine transport will reduce traffic congestion and help the Tanzanian government to save money that could be used to rehabilitate road infrastructure that could have been damaged by heavy trucks.

He gave an example of tonnes of fuel that passed through the Mwanza South Port to Uganda a few months back and arrived safely to the destination.

The Ugandan minister added that the construction of the Standard Gauge Railway (SGR) will also stimulate business between the two countries.

The Central Corridor Transit Transport Facilitation Agency (CCTTFA) Executive Secretary, Advocate Flory Okandju, said that infrastructure improvement in Tanzania will help to remove trade barriers among East African countries.

He added that improving infrastructure means economic growth, poverty eradication and employment creation.

“We also call upon Ugandan minister to make sure the same infrastructure are also available in his country so that we can strengthen our businesses… we also call on all East African countries to make use of the Central Corridor,” he said.

The Acting Lake Zone Ports Manager, Mr Vincent Stephen, said that cargo volume has been increasing at Mwanza South Port, following improvement of the port infrastructure.

According to him in 2021/2022 the port targeted to receive 195,000 tonnes of cargo but it surpassed the target by receiving 230,000 tonnes. “We expect an increase to between 300,000 and 350,000 tonnes, this year,” he said.

The Acting Chief Executive Officer for Marine Services Company (MSCL), Mr Philemon Bagambilana said that rehabilitation of the cargo ship- MV Umoja is at over 30 per cent.

The rehabilitation involves, among other things, cargo capacity from 19 to 21 wagons and is expected to be completed in February next year.