NMB Bank Limited @20

NMB Bank Limited turns 20 years this month so this week’s instalment duly recognises its achievements at a time when the broader banking sector faces multiple challenges.

Financial Sector Spotlight with with Omen Muza

I have singled out the bank for special mention not only because I spent five of the formative years of my banking career at Unity Court, but mainly because of the significance of NMB Bank’s achievement in the context of the current make up of the banking sector.

The then National Merchant Bank of Zimbabwe was formed as the first wholly Zimbabwean merchant bank by the trio of Dr Julius Makoni (who now prefers his new title of Bishop), current Group CEO James Mushore and Deputy Group CEO Francis Zimuto. NMB Bank’s pioneering role means that its continued existence augurs well for the indigenous banking revolution, shaky as the revolution may currently be.

Additionally, the fact that the impetus of the bank’s formation was liberalisation of the Zimbabwean economy means that its continued existence essentially vindicates the decision to liberalise the economy. Viewed in this context, NMB’s successes cease to become theirs alone, but belong to all progressive Zimbabwean businesspeople.

To put its longevity in perspective, of the local banks in operating today, only BancABC, CBZ Bank Limited and ZB Bank have been around longer than NMB Bank.

This longevity is further illustrated by the fact that in 1993 when the bank first opened its doors to the banking public, Dr Leonard Tsumba was beginning his tenure as the second governor of the Reserve Bank of Zimbabwe (RBZ).

Incidentally, NMB Bank celebrates its 20-year anniversary at a time when the third governor of the RBZ, Dr Gideon Gono is winding down his term of office.

Alongside BancABC, NMB Holdings is one of only two dually listed Zimbabwean banking groups. NMB Bank is the main operating unit of NMBZ Holdings, which is listed on the Zimbabwe Stock Exchange (ZSE) and the London Stock Exchange (LSE).

In early 1997, as it sought to enhance capacity to underwrite more business, the NMBZ Group embarked on a hugely successful capital raising exercise which saw it being listed on the ZSE and the LSE through an Initial Public Offer (IPO) that was 4.5 and 2 times oversubscribed in Harare and London respectively.

Its ZSE listing makes it one of the six active financial counters on the local bourse alongside ABC Holdings, Barclays Bank, CBZ Holdings Limited, FBC Holdings Limited and ZB Financial Holdings Limited.


Interfin and Trust Holdings Limited are currently suspended.

Another milestone for NMB Bank was being granted a commercial banking licence in December 1999, paving the way for commercial banking operations to commence in July 2000 and enabling it to diversify sources of funding and enhance its product offering.

It hasn’t however, been all plain sailing for the bank; it has had its fair share of challenges over the years. Hardly three years after its formation, there was a mass exodus of staff and business at the establishment of Trust Bank in 1996. This was followed by the temporary losses of its Authorised Dealership Licence on two occasions due to incidences of Exchange Control violations and fraud.

These setbacks have, however, only served to demonstrate the resilience of the NMB brand, which has emerged stronger after each crisis. Even the upheaval of forced management changes at the height of the 2003/2004 banking crisis and towards the end of the hyper-inflationary era in 2008 was no match for the bank’s reputation.

NMB Bank’s success can be attributed partly to its formation by experienced entrepreneurs who had previously held senior positions at international institutions such as the World Bank and IFC.

In recent years, the attractiveness of NMB’s brand has come in handy in its quest to grow value and improve shareholder profile. This has seen it successfully courting foreign investors at a time when country risk is arguably at its peak.

In March 2013, the bank attracted state-owned investment vehicle Norwegian Investment Fund for Developing Countries (Norfund)’s first investment in Zimbabwe when Norfund, together with AfricInvest Capital Partners and FMO emerged as NMB’s strategic partners after investing a combined US$14,8 million through equity in exchange for about 27% shareholding.

Feedback: omen.muza@gmail.com.  Omen N. Muza writes in his personal capacity. You can view his LinkedIn profile at zw.linkedin.com/pub/omen-n-muza/30/641/3b8

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