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Nedbank mulls disposing of asset management firm

NEDBANK Ltd, MBCA’s major shareholder, is considering disposing its asset management firm, a move which market watchers said was meant to increase the group’s earnings.

According to information at hand, Nedbank, with a 70,41% stake in MBCA, had done all the paper work to dispose MBCA Asset Management.
MBCA on Wednesday confirmed the development saying it had embarked on a repositioning initiative.
“Our aim is to be the leading lender in Zimbabwe, specialising in corporate and business banking, trade finance, private clients and advisory service,” said MBCA in a written response to businessdigest. “This repositioning is to ensure we remain profitable in the tough operating environment following the capital raising programme which demonstrates Nedbank group’s confidence in MBCA Bank.”
As of December 31 2009, MBCA deposits amounted to US$22,9 million with a market share of 1,7%. The bank advanced loans amounting to US$52,4 million representing a market share of 6,7%. The financial institution had a loan-to-deposit ratio of 125,44% during the same period
“Our focus is on appropriate products and services for our targeted market segments on service excellence and customer value. Our internal processes are receiving greater emphasis to boost efficiency and discipline,” the bank said.
MBCA, one of the four foreign-owned banks operating in Zimbabwe, recently raised US$9,2 million from a rights issue to recapitalise the group’s commercial entity to meet the regulatory capital requirements set by the Reserve Bank of Zimbabwe (RBZ).
The other foreign banks are Stanbic, Standard Chartered and Barclays.
The recapitalisation move would see the bank attracting significant off-shore credit facilities from corresponding banks, which prefer to deal with adequately capitalised banks.
The rights issue raised US$9,2 million for MBCA Bank, US$500 000 for MBCA Capital Management and US$300 000 for the holding company.
Rights in MBCA, rated the most efficient bank with a return on equity of 99% and a cost to income ratio of 57%, are owned directly and indirectly by South Africa’s Nedbank, NM Rothchild & Sons Limited, Mediobanca-Banca de Credito Finanziario, Old Mutual Zimbabwe and a number of employee vehicles.
“Effective shareholding by Nedbank Ltd and Old Mutual Zimbabwe has increased to 70,41%  and 17,90% respectively after the rights issue. Part of the repositioning entails the sale of their interests in MBCA Capital management Ltd,” said MBCA Bank.

 

Paul Nyakazeya

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