transforming public sector banks national microfinance bank
DESCRIPTION
Misconceptions Commercial loans are necessary Expensive centralized bank operating systems are necessary Foreign training is necessary The Poor don't save The Poor don't repay loansTRANSCRIPT
Transforming Public Sector Transforming Public Sector BanksBanks
National Microfinance Bank
Why BotherWhy Bother Development stops at the major cities
Commercial Banks focus on urban areas and more formal sectors, leaving the “underserved”
Critical to the financial network of the countryEveryone uses a national banking system Government Banks
Private Sector
MisconceptionsMisconceptions
Commercial loans are necessaryExpensive centralized bank operating
systems are necessaryForeign training is necessaryThe Poor don't saveThe Poor don't repay loans
Enabling EnvironmentEnabling Environment
Business LawLabor LawsCourtsGovernment Support
PoliticalPolitical
Perseverance to maintain business principles
MarketMarket
Critical Mass of DemandOpportunity for Key Products
RemittancesSavingsCredit
LaborLabor
Availability
Adaptability
Mobility
Business InfrastructureBusiness Infrastructure
Management
Suitable Technology
Branch Network
External SupportExternal Support
World BankDAICentral Bank of TanzaniaPSRCMinistry of Finance
Banks Comparative Performance as of December 31 2002
-4000
-2000
0
2000
4000
6000
8000
10000
12000
14000
Tzs
Mill
ions
NBC Stanchart NMB Citibank CRDB Stanbic Barclays
Profit before Tax31 Dec. 2002Dec-02 Dec-01
AFTER TAX PROFITS
(3,000)(2,000)
(1,000)-
1,0002,000
3,0004,000
5,0006,000
1998 1999 2000 2001 2002
Tshs
mill
ions
FEE INCOME(exclusive of government fees)
-1,0002,0003,0004,0005,0006,0007,0008,000
1998 1999 2000 2001 2002
Tshs
. mill
ions
BRANCHES LENDINGBRANCHES LENDING
0
10
20
30
40
50
60
70
80
2000 2001 2002 2003
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Existing
Microfinance Loan Growth
-500
1,0001,5002,0002,5003,0003,5004,0004,500
1998 1999 2000 2001 2002
Tshs
. mill
ions
Staff TrainingStaff Training
Man-Days of Training Conducted
2001: 3,013 Man-days
2002: 5,506 Man-days
Attendance
2001: 763 individuals
2002: 981 individuals
Employee Headcount
800
850
900
950
1,000
1,050
1,100
1998 1999 2000 2001 2002
NON-INTEREST EXPENSE
-2,0004,0006,0008,000
10,00012,00014,00016,00018,00020,000
1998 1999 2000 2001 2002
Tshs
. mill
ions
INFORMATION TECHNOLOGYINFORMATION TECHNOLOGY 70 branches
automated Core Banking
System Implemented by year-end 2003
Centralized accounts payable
Increased centralization of branch accounting
0
20
40
60
80
100
Num
ber
of B
ranc
hes
1997 1998 1999 2000 2001 2002 2003
Automation Growth
