Bank reaffirms its commitment to supporting Zambia’s economic growth in energy, infrastructure and mining
Zambia’s largest financial institutions by asset size, Stanbic Bank, grew its balance sheet by over K2.3billion (about USD252million) through credit extension to key sectors that drive the copper producers gross domestic product growth. The bank has continued to outpace the commercial banking sector’s average performance, reinforcing its commitment to funding economic growth.
Stanbic through its corporate and investment division funded more than US$252million of key debt and advisory led transactions in Zambia last year, Chief Executive Leina Gabaraane said. The bank funded mining with US$101million, public sector with US$67million, the non bank financial sector (NBFI) with US$28million, telecoms with US$41million and real estate with US$38million, Gabaraane said.
Our involvement in these transactions went a long way in uplifting the general social and economic standards of the country and touched on job creation and job security for over 14,000 direct and indirect beneficiaries,” said Stanbic Zambia Chief Executive Leina Gabaraane.
Mr. Gabaraane explained that the extent of the bank’s integration into the economic system is such that Stanbic’ s performance is closely correlated with fluctuations in the economy.
“Use of proceeds from the funding we arranged or funded went towards expansion finance, mine life extension, equipment finance and several brand-new greenfield developments. Based on funds arranged and deployed to the mining and real estate sectors over the last five to ten years, Stanbic Bank Zambia ranks at the top of the country’s debt finance league tables,” he continued.
In addition to the knock-on effect of increased taxes for the government and our support of the key sectors of the economy, Stanbic plays a key role in supporting the small and medium enterprises (SMEs), sector, more so with the real estate transactions we backed, which will see the opening of over 60 new trading outlets once they are completed.
The bank believes small and medium enterprises (SMEs), are the engine of the nation’s growth, and that ensuring simpler and more friendly regulations for such businesses to thrive is key to making Zambia an attractive investment destination.
Gabaraane said that despite mining being an important economic sector, efforts at diversifying the economy away from over-dependence on mining would manage the risk of cyclic metal prices, and Stanbic believed agriculture remained the top priority sector to drive Zambia’s growth.
He further said that an International Monetary Fund (IMF) programme would help address sentiment and boost reserves, but that government measures to curb spending and boost their revenue mobilization was a positive thing.
“Interest rates remain elevated as a reflection of the higher perceived risk of the economy due to ratings downgrades, something an IMF programme would help avert. However, we are in a better place, with the copper price stable and the currency.
Power supply has also been stable and resulted in good copper output numbers, so, a lot is being done locally to address some issues that have been of concern in the economy from a fiscal stand point,” Gabaraane said.