Mkombozi Commercial Banks Plc. (MKCB) of Tanzania Initial Public Offering (IPO) and listing at Dar es Salaam Stock Exchange (DSE) alternative market, the Enterprise Growth Market (EGM) have been approved by the Tanzanian Capital Markets & Securities Authority (CMSA).
The IPO offers 5,000,000 shares at a prize of TZS 1,000.00 each. The IPO is open from Monday 3rd November 2014 until Saturday 29th November 2014.
Expected listing date is Monday, 22th December 2014.
When the IPO is completed, the bank’s issued paid up capital will increase to TZS 21,838,452,000 from the current issued and paid up share capital of TZS 16,838,452,000.
The move is in response to a direction by the Bank of Tanzania (BOZ) that required all banks to increase its core capital to TZS 15 billion by March 2015.
Between November 2013 and February 2014, the bank had an opportunity to raise its capital through a Rights Issue to TZS 5.8 billion, equal to three-quarters of the funding requirements.
As explained to TanzaniaInvest by Mrs. Edwina Lupembe, CEO of Mkombozi, three are the reasons behind MKCB IPO:” one, compliance issues, to reach TZS 15 billion core capital by march 2015. Second, to allow the expansion of the bank and open new branches and third involve the pubic, part of the financial inclusion exercise.”
According to letter of the Chairman Mr. Masha Mshomba, included in MKCB Prospectus:“Proceeds from the IPO (net of IPO expenses) will be used to meet objectives in the prioritized areas, pending which they will be invested in short-term Government securities. These areas include the establishment of agency banking; intensification of micro lending activities; intensification of corporate lending activities; continuation of advancing salary loans, increase in the mobilisation of deposits; establishment of two new branches; and increase of total assets.”
Mkombozi Commercial Bank Plc. was incorporated on 6th March 2007 and was granted banking license by the BOT as a full-fledged commercial bank on 18th July 2009 and started business on 28th August 2009.
The majority shareholding is comprised of the Tanzania Episcopal Conference, its dioceses and congregations.
Although MKCB is licensed to provide all commercial banking services, its main focus at the moment is in commercial lending (2014 target 71%); salaried loans (15%); solidarity group lending (10%); and agriculture (4%).
The bank did break even in year 3 (2011) with a profit after tax of TZS 37 million. In 2013 profit after tax reached TZS 119 million.
For the first quarter of 2014 the bank recorded a profit of TZS 365 million. Estimated 2014 profit after tax is TZS 1.7 billion.
Follow the links to download Mkombozi Commercial Bank Plc Prospectus: http://tanzaniainvest.com/downloads/Mkombozi-Commercial-Bank-Plc-Prospectus-2014.pdf
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