Jiya targets to grow NBM profit to $100m

National Bank of Malawi (NBM) plc newly appointed chief executive officer Harold Jiya says he is well-prepared for the job and targets to deliver a $100 million (about K175 billion) profit after-tax for the bank by 2027.

He said he also plans to increase the Malawi Stock Exchange-listed bank’s customer base to two million and increase its regional reach.

In his presentation during an interaction with business journalists in Blantyre on Wednesday, Jiya, who has taken over from MacFussy Kawawa on July 1, said NBM is a well-performing bank.

He said he plans to move the bank, which chalked a K71.96 billion profit after-tax in the year ended December 31 2023, to the next level in line with the five-year strategic plan.

Said Jiya: “We have a strategic plan which I was part of in developing. We are clear about the path that we want to take.

“I am confident that I will deliver on that strategic plan. We are number one in the country, but I want us to be the number one digitalised bank in the country.”

He said NBM is interested to spread its reach within the region, having already penetrated the Tanzania market through the acquisition of 51 percent in Akiba Commercial Bank in 2021.

“That is my focus goal and I am sure with the grooming that I have had and being number two understudying the CEO who retired, I am more than ready to take the bank on this path,” said Jiya, who has been with NBM for over 20 years.

On regional acquisitions, he said NBM conducted a regional study to find out where they can get more value and also looked at where their customers do business.

Said Jiya: “We noted that most of our customers do business in Tanzania, Mozambique and Zambia. We are following where our customers go to that is why we bought a bank in Tanzania and we are looking at several targets in Mozambique and Zambia.

“We are looking at comparable target that we can easily turn around so that they are performing.”

He said they have done country studies and due diligence on a few banks they can work with and are talking to some shareholders.

“We know that buying a bank is a difficult process because you have to have a willing seller and willing buyer and have to agree on the price,”  said Jiya.

In the year ended December 31 2023, NBM’s after-tax profit was pushed by 20 percent growth in customer deposits.

The profit increased by 56.6 percent from the previous year’s K45.9 billion, according to the bank’s financial statement.

“These results were largely driven by growth in customer deposits which resulted in increases in the loan book and fixed income securities,” reads the financial statement in part.

In the year under review, the bank’s net interest and investment income grew by 33 percent coupled with an 86 percent increase in other income, mainly arising from growth in foreign exchange commissions by 99 percent from K12.8 billion to K25.5 billion, the results show.

Overall, net revenue grew by 50 percent while operating expenses increased by 25 percent which was within the 28 percent average inflation for the year, according to the statement.

But the bank’s net impairment losses continued to increase, reflecting the realities of the tough operating environment.

Meanwhile, the bank has forecast a continuing challenging operating environment, but said it expects to sustain its performance by exploiting opportunities in the market.

Published World Bank data shows that in 2023, the banking sector’s profit after tax increased by 50.2 percent to K 256.7 billion compared with K170.8 billion recorded in December 2022.