One of the top three commercial banks in Tanzania plans to cross list on the Uganda Securities Exchange
One of the top three commercial banks in Tanzania, CRDB Bank Plc, has said it is planning to open a branch in Bujumbura, making it the first Tanzanian bank to expand to Burundi.
This is will also make CRDB the second bank in the country to invest outside Tanzania after Exim bank which has invested in The Comoros Islands.
The Bank's Managing Director, Dr. Charles Kimei told the East African Business Week in Dar es Salaam last week that the branch will be opened on July 1 this year.
Dr Kimei, said they targeted Bujumbura because the banking system is still undeveloped with just 6% of the population banked.
"Burundi needs microfinance services...we are ready to intervene and help them to develop," Dr Kimei said last week when presenting this years' first quarter financial results.
The bank said its profit increased by 34% to Tsh28 billion ($ 17.5 million) in the first three months of the year. In Tanzania, the bank has over 80 branches across the country, supported by 215 ATMs.
The bank's supremo said that the bank will be a plus to a number of its customers plying between Dar es Salaam and Bujumbura and others who access their services near the border towns.
The bank said that they are finalizing relevant operation permits with Burundi's central bank.
Dr Kimei said that CRDB wants to solidify its presence in Bujumbura to become not just a bank but a leading entity driven by respect and credibility.
He said the bank, which is listed on the Dar es Salaam Stock Exchange, delayed to expand outside the country because the internal "market is still too good" surrounded with a number of opportunity.
But with growing activities in the East African Community (EAC), the financial sector going out strategy is now important to the bank expansion.
The MD also said once the time is ripe they will also cross-list across at the Nairobi Stock Exchange and Uganda Securities Exchange to ease share trading and not to raise capital.
The International Monetary Fund (IMF), mission to Burundi led by Mr Oral Williams, said late last year at the conclusion of their visits that the economy is expected to grow by about 4.2 % this year, lower than the earlier projections as a result of weakening in aggregate demand related to the food and fuel price shocks.
Although headline inflation rose sharply to 11.7 % last September, core inflation remained in single digits.
A rebound in coffee production and construction activity should contribute to a moderate pick-up in growth to 4.8 % next year.
BY LEONARD MWANGA The East African Business Week 28 MAY 2012