BANK OF AFRICA – TANZANIA Limited (BOA-TANZANIA) recorded a pre-tax profit of TZS 6 billion (2019: Loss of TZS 16.1 billion) during the year ended 31 December 2020. The profit is attributed to the increased investment in Government securities which resulted into increased interest income & gains on securities trading, decreased impairment charges and the reduction in operating expenses through cost initiatives measures such as the reduction in the number of staff & closure of loss-making branches.
Impairment charges on loans and advances declined from TZS 14 billion in 2019 to TZS 2.7 billion – equivalent to 80.6% decline. This follows an improved quality of the loan portfolio as evidenced by the decline of Non-Performing Assets Ratio from 9.2% at the end of 2019 to 7.5% at the end of 2020. This was a result of management’s exercise of more stringent credit appraisal processes coupled with strengthening of the Recovery & Risk Prevention functions. The credit selection, appraisal and approval processes, complemented by strong relationships with customers have ensured that potential credit delinquencies are identified and managed at an early stage.
