NMBZ Holdings has secured in excess of US$56 million worth of lines of credit in the last five years to fund various projects, but is yet to draw down on some of them due to foreign currency shortages in the country.
By Melody Chikono
The credit lines have been funded by five different institutions, including for on-lending to small-to-medium enterprises (SMEs).
The bank is hoping to start drawing down on some of the lines in 2018 as it moves to target exporters.
Zimbabwe is facing challenges in accessing foreign currency with some companies being unable to process payments for imported raw materials and are now on the brink of closure.
NMB CE Benefit Washaya told businessdigest this week the bank will now restrict credit lines it secured for SMEs to exporters as shortages of foreign currency persist in the country. This has been necessitated by the fact that while it was easy to secure these lines for this sector, repayments were being made in local currency, making it difficult for the bank to repay the money.
Washaya said the bank has decided instead to channel the facility to exporters who are in a position to generate foreign currency to repay.
“We have been successful in our drive of securing lines of credit as we leveraged on our strong shareholder base. We have a total of US$56,4 million approved credit lines from five different institutions over the last two to five years. Most of our lines were initially targeted at SMEs. However, due to the shortages of foreign currency, we had to restrict utilisation of the lines to exporters since they are able to generate the much-needed foreign currency in order to support the repayments when the lines fall due,” he said.
However, Washaya said NMB remained positive about the outlook with the current re-engagement of the international community expected to translate to reduced country risk.
“That is one of the challenges we battle with when we go out to look for lines of credit. As a bank, we are going to play our part in supporting the economic developmental aspirations of the country and our customers,” he said.