CRDB and NMB posted a collective profit growth of 53% on an annual basis, to a collective total profit of TZS 580bln. Grown profits for both banks resulted from increased interest and non-interest income as they collectively grew their loan portfolios by 31% to TZS 11.85trn, somewhat 43% of the total national banking loan portfolio. The growth is on the back of accommodative measures implemented by the central bank, which have facilitated an aggregate credit growth of 20% to the private sector by July 2022, the speediest expansion in the last seven years.
Different from NMB, CRDB saw tightened interest margins as interest expenses grew quicker than interest income. It should be remembered that in March 2022 CRDB’s loan to deposits ratio went above 80% for the first time since March 2017. It seems the bank increased aggressiveness in deposit mobilization with campaigns like Flexi Account which offers 9% on deposits secured for at least three years. Moreover, the bank’s borrowings as a share of total liabilities have been gradually growing, from 5.6% in September 2019 to the current 15.3% in September 2022. The bank has since slightly lowered the loan to deposits ratio from 86% in March 2022 to 83.4% by end-September, 2022 which is still above the regulatory 80% recommended threshold.
