CRDB Bank sets aside $30 million capital for DRC entry

Dar es Salaam. CRDB Bank Plc has set aside $30 million in capital for its entry into the Democratic Republic of Congo (DRC), the bank has said.

Speaking during a virtual meeting with investors, the CRDB Bank Plc managing director, Mr. Abdulmajid Nsekela, said the lender was only finalizing regulatory procedures.

“Our plan is to enter the market with two partners…. We have set aside $30 million as capital, and so far, we are only finalizing regulatory procedures,” he told 35 participants from various investment funds across the world.

Mr. Nsekela was specifically responding to a question from a senior portfolio manager from Old Mutual Investment Group SA, Mr Randolph Oosthuizen, who wanted to know the steps that CRDB Bank had so far taken in its DRC expansion plan.

Mr Nsekela told the investors that CRDB Bank Plc is looking up to partnering with Norway’s Norfund and Denmark’s IFU in its DRC venture.

Also known as the Investment Fund for Developing Countries, the IFU is a Development Financial Institution owned by the Government of Denmark. It is a self-governing, state-owned fund that aims to promote economic and social development in developing countries.

It provides risk capital and advice to companies wanting to do business in Africa, Asia, Latin America, and Europe.

From its head office in Copenhagen and on-location through regional offices in Asia, Africa, Latin America, and Central and Eastern Europe, IFU works with more than 800 Danish companies and has so far made more than 1200 investments in 100 developing countries. Its total investment is valued at about 160 billion Euros.

On the other hand, Norfund is a private equity company that the Norwegian Ministry of Foreign Affairs owns. The fund – whose head office in Oslo and local offices in Thailand, Costa Rica, Kenya, Mozambique, and Ghana - receives its investment capital from the state budget.

Norfund helps to build sustainable businesses that would not otherwise be developed because of the high risks involved.

CRDB Bank’s board chairman, Dr. Ally Laay, told the lender’s Annual General Meeting (AGM) in Arusha in May this year that the Bank of Tanzania (BoT) had issued approval for its (CRDB Bank) DRC expansion.

BoT Deputy Governor (Financial Stability and Deepening), Dr. Bernard Kibesse, confirmed at the AGM that the regulator had indeed given the green light for CRDB Bank Plc’s entry into the DRC market. He said BoT’s role was to facilitate a smooth passage of CRDB to Congo, noting that the regulator would work closely with its counterpart in the DRC for a smooth transition from one country to another.

During the virtual investors’ briefing, an associate Vice President at EFG-Hermes, Mr. Muamamar Ismaily, wanted to know about CRDB Bank’s investment in digital banking.

In response, Mr. Nsekela said CRDB Bank had invested massively in digital banking through such platforms as SimBanking, Internet banking, Agency banking (CRDB Wakala), and SimAccount. He said currently, 85 percent of customers’ transactions are being done digitally.

Among others, the virtual session was attended by several individual investors and their counterparts from Old Mutual Investment Group of Cape Town, South Africa, Change Global Investment of Camas, Washington in the United States, as well as EFG Hermes of Cairo in Egypt.

The list also included EMIM of London in the United Kingdom, CGI of Camas, 337 Frontier of New York, and Securities Africa from South Africa.