NMB BANK PLC20th ANNUAL GENERAL

MEETING

5th June 2020

03

02

01

PRESENTATION FLOW

BANK OVERVIEW & ACCOMPLISHMENTS - Ourhistory, transformation, national & global recognition, current shareholding structure, 2018 vs 2019 & value added to stakeholders

FINANCIAL REPORTS - NMB’s position in the banking sector, Financial performance overview

Q1 2020 RESULTS - Snapshot of our balance sheet and profit and loss account Q1 2019 vs Q1 2020

04 COVID–19 - Impact assessment and NMB’s response to the impact

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06 2019 DIVIDENDS - Dividend Payment as proposed by the board

Q&A - Investor Relations office

BANK OVERVIEW & ACCOMPLISHMENTS 01.

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OUR HISTORY

Established under the National Microfinance

Bank Limited Incorporation Act of 1997,

following the break-up of the defunct National Bank

of Commerce. Three entities were formed: National

Microfinance Bank, NBC Holdings Limited and

National Bank of Commerce.

Established

1997

2005

Rabobank

Group

The Government of Tanzania sold 49% to a

consortium led by the Rabobank Group. The

consortium consisted of Exim Bank (Tanzania)

Limited, National Investments Company Limited

(NICOL) and TCCIA Investment Company Limited.

The Government sold 21% of its shareholding

to the Tanzanian public through an IPO on the

DSE market. At the close of the IPO, the

Government had 31.8% stake in NMB which it

holds to-date.

IPO

2008

2017

Name

Change

The bank changed its name from National

Microfinance Bank Plc to NMB Bank Plc to

reflect the fully fledged commercial bank it has

become.

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OUR TRANSFORMATION

2019

Listed on the Dar es Salaam Stock Exchange

> TZS 6.5trl Balance Sheet size

Fully fledged commercial bank providing solutions to Government and Commercial clients

224 branches across Tanzania

794 ATMs > 5,980 Agents

> 3.3 million MasterCard debit cards

State of the art Internet Banking Platform

> 2 million NMB Mkononi customers

State of the art technology –Tier 3 Data Centre

> 4 million customer accounts

600,000 customer accounts

Limited product offering: savings accounts + payments

< TZS 200Bn Balance Sheet size

Payment Factory 97 branches across Tanzania

1997

NO ATMs NO Cards

NO Mobile Banking

Limited Technology

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CURRENT SHAREHOLDING STRUCTURE

Govt of Tanzania

31.8%

Rabobank Group

34.9%

Other

13.8%

Morgan Stanley

2.8%

SQM Frontier Africa

1.9%

Pension funds

2.0%

1.0%

Patrick Schegg

NICOL

6.6%

Aunali & Sajjad Rajabali

5.0%

NHIF

NHIF

0.2%

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NMB 2018 vs NMB 2019

2018

NMB

2019Agency Banking

Staff

Accounts

Agency Banking

Staff

Accounts

776

6,800

3,450

3.3 MILLION

794

5,980

3,450

4 MILLION

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NATIONAL & GLOBAL RECOGNITION

Best Bank in Tanzania - 7th time in a row

Euromoney Awards for Excellence

Best Bank in Tanzania - 6th time in a row

Euromoney Awards for Excellence

Best Retail and Best Commercial bank in Tanzania

Banker East Africa Magazine

Best Blended Finance Partner in Africa

International Finance Corporation (IFC)

Best presented Financial Statement 2017 and 2018

National Board of Accountants and Auditors

Bank of the Year

Banker Africa

Best listed Company

Dar Stock Exchange

Best Bank Transformation in

Africa

Euromoney Awards for Excellence

Best Bank in Tanzania 5th time

in a row

Euromoney Awards for Excellence

Best Retail Bank in Tanzania

Asian Banker Awards

20

19

/18

20

17

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VALUE ADDED TO STAKEHOLDERS

2018 2019

Govt. Taxes: TZS 183 bn

Shareholders: TZS 48 bn

Investments: TZS 144 bn

Employees: TZS 138 bn

Govt. Taxes: TZS 144 bn

Shareholders: TZS 33 bn

Investments: TZS 98 bn

Employees: TZS 124 bn

27%

45%

47%

11%

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SUPPORTING MAJOR PROJECTS IN THE ECONOMY

Construction of SGR BG – TZS 140 Bn

• Supply of spare parts for Kinyerezi I LC – TZS 70 Bn• REA contractor's BG & LC - TZS 105 Bn

• Structured financing for 400 TARURA & TANROADS

contractors - TZS 26 Bn• Bus Rapid Transport Financing - TZS 100 Bn

Procurement of Terminal equipment TPA LC line - TZS 70 Bn

Pharmaceuticals and medical equipment LC – TZS 58 Bn

• Tabora, Igunga & Nzega Water Pipeline LC transaction facilitation – TZS 550 Bn

• Rehabilitation of Water treatment plant for DAWASA LC transaction facilitation –

TZS 35 Bn

TZS 1.2 Trillion

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Payment and collection solutions - TZS 3.5 Trillion collected in 2018 and 2019

WE GIVE BACK TO THE COMMUNITY WE SERVE

For the past 4 years, over TZS 4Bn used

• Over 330 hospitals were provided

with health care appliances

Over 31,150 desks were provided for schools

Over 1,150 computers were provided to schools

• Over TZS 200Mn provided to the

Government of Tanzania & Zanzibar to aid in the fight against Covid-19

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Computers

Health Care Appliances

COVID-19 Relief

Desks

FINANCIAL REPORTS02.

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BANKING SECTOR 2019

BANK I BANK H BANK G BANK F BANK E BANK D BANK C BANK B BANK A

No. 1

142.1

122

34.022.7

21.317.4

16.99.89.69.1

2019 TOP 10 MOST PROFITABLE BANKS

(PAT) IN TZS BILLIONS

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BANKING SECTOR 2019

105132

93 98142

451

357

209239

386

2015 2016 2017 2018 2019

NMB PAT Bank Sector PAT

2.1

4.8 6.4

5.9 6.7

6.4

9.5

11.710.4

8.9

2015 2016 2017 2018 2019

NMB NPL Ratio Bank Sector NPL Ratio

2019 Profit after Tax

62%

Industry average increase

46%

NMB increase

Industry Non-Performing loan ratio

2019

8.9%

2018

10.4%

2017

11.7%

NMBs PAT 2019 Market share

37%

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FINANCIAL PERFORMANCE OVERVIEW

370

449 467 492 518

2016 20182015 2017 2019

Net Interest Income (TZS Billions)

1330

131 137

100

2016 20182015 2017 2019

160 151 159

196 204

2016 20182015 2017 2019

Non Interest Income (TZS Billions)

150 154

93 98

142

Profit After Tax (TZS Billions)

2016 20182015 2017 2019

Impairment (TZS Billions)

Increase of NII due to continued growth in loans and advancesand investment in Government securities

5%Y-O-Y

Increase

Operating Expenses remained flat.

0%Y-O-Y

change

Reduction of Impairment charge due to improvement of loan Portfolio management

27%Y-O-Y

Decrease

46%Y-O-Y

Increase

15

310362 375

409 411

NFI growth driven by increase of revenues from NMB Mkononi, Agency banking commission, and Card fees.

4% Y-O-Y

Increase

Operating Expenses (TZS Billions)

2016 20182015 2017 2019

FINANCIAL PERFORMANCE OVERVIEW

3.6

2.52.8 2.8

3.3

Loans and Advances (TZS Trillion)

2015 2016 2017 2018 2019

3.6 3.74.3 4.3

4.9

2015 2016 2017 2018 2019

Customers Deposit (TZS Trillion)

0.70.8 0.8

0.91.0

Share holders funds (TZS Trillion)

2015 2016 2017 2018 2019

Total Assets (TZS Trillion)

2015 2016 2017 2018 2019

4.6 5.05.5 5.7

6.6

11% 14% 15% 13%

Y-O-Y Increase Y-O-Y Increase Y-O-Y Increase Y-O-Y Increase

Key Ratio 2015 2016 2017 2018 2019

Return on Equity % 23 20 12 11 15

Return on Asset % 3 3 2 2 2

Cost to Income Ratio % 57 59 58 59 60

Earning per Share (TZS) 298 308 187 195 284

Dividends per Share (TZS) 104 104 64 66 96

Tier 1 Capital % 20 19 16.9 16.5 17.1

Total Capital % 22 20 17.6 18.5 18.5

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2019 BALANCE SHEET

Loans & Advances increased by 334Bnbetween 2018 & 2019

11%Y-O-Y

Increase

Borrowings increased by 171Bn driven by NMB bond which was oversubscribed by 333%

35% Y-O-Y

Increase

The performance shows a positive jaws as deposits increased faster than loans & advances

Customer deposits increased by 594Bnbetween 2018 and 2019

14%Y-O-Y

Increase

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2019 2018 Variance

TZ' Billion TZ' Billion TZ' Billion

Cash & Balances with BOT 1,341 1,070 271 25%

Interbank Placements 264 174 90 52%

Government Securities 764 740 24 3%

Loans and Advances 3,596 3,252 344 11%

Other Assets 590 444 146 33%

TOTAL ASSETS 6,556 5,681 875 15%

Customer Deposits 4,922 4,328 594 14%

Borrowings 661 490 171 35%

Shareholders Funds 972 863 109 13%

TOTAL LIABILITIES 6,556 5,681 875 15%

Loan to Deposit Ratio (LDR) 72% 78%

Core Capital 17% 17%

Capital Adequacy Ratio 19% 19%

% Variance

2019 PROFIT & LOSS ACCOUNT

Net interest income increased by 26Bn driven by increased Loans & Advances.

5%Y-O-Y

Increase

Loan Impairment has decreased by 37Bn between 2018 & 2019

27% Y-O-Y

Decrease

Operating Expense has been contained Y-o-Y with a slight decrease or 2Bn

Non-Funded income increased by8Bn between 2018 & 2019

4%Y-O-Y

Increase

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2019 2018 Variance

TZ' Billion TZ' Billion TZ' Billion

Net Interest Income 518 492 26.4 5%

Non Funded Income 204 196 8.4 4%

Total Income 723 688 34.8 5%

Loan impairment (100) (137) 37 -27%

Operating Income 623 551 71.8 13%

Operating Expenses (411) (409) -2 0%

Income Before Tax 212 142 69.8 49%

Tax (69) (44) -25 57%

Profit After Tax 143 98 44.8 46%

Cost to Income Ration (CIR) 60% 59%

Non Funded Income to Total Income (NFI/Total Income) 28% 28%

Return on shareholder's fund 15% 11%

Performance Summary% Variance

CAPITAL ADEQUACY & LIQUIDITY

20.3

19.2

16.9 16.517.1

21.6 20.4 17.6 18.5 18.5

71%

76%

68%

78%

72%

62%

64%

66%

68%

70%

72%

74%

76%

78%

80%

0

5

10

15

20

25

2015 2016 2017 2018 2019

Core I Capital Total Capital Loan to Deposit Ratio

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Q1 2020 RESULTS03.

20

Q1 2020 BALANCE SHEET

Loans & Advances increased by 475Bn between Q1 2019 & Q1 2020

15%Y-O-Y

Increase

Customer deposits increased by 202Bn between Q1 2019 & Q1 2020

4%Y-O-Y

Increase

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Q1 2020 Q1 2019Variance

TZ' Billion TZ' Billion TZ' Billion

Cash & Balances with BOT 1,129 1,341 (212) -16%

Interbank Placements 150 264 (114) -43%

Government Securities 931 820 111 14%

Loans & Advances 3,705 3,230 475 15%

Other Assets 556 901 (345) -38%

Total Assets 6,472 6,048 424 7%

Customer Deposits 4,758 4,556 202 4%

Borrowings 693 613 80 13%

Shareholder's Fund 1,021 880 141 16%

Total Liabilities 6,472 6,048 424 7%

Loan to Deposit Ratio 81% 74%

Capital Adequacy Ratio (%) 20% 18%

Balance Sheet Variance

Net interest income increased by 12Bn between Q1 2019 & Q1 2020

10%Y-O-Y

Increase

Non-Funded income increased by11Bn between Q1 2019 & Q1 2020

22%Y-O-Y

Increase

Loan Impairment has decreased by 16Bnbetween Q1 2019 & Q1 2020

43% Y-O-Y

Decrease

Q1 2020 PROFIT & LOSS ACCOUNT

Profit After Tax has increased by 49Bnbetween Q1 2019 & Q1 2020

146%Y-O-Y

Increase

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Q1 2020 Q1 2019Variance

TZ' Billion TZ' Billion TZ' Billion

Net Interest Income 134 122 12 10%

Non Funded Income 60 49 11 22%

Total Income 194 170 24 14%

Loan impairment (22) (38) 16 -43%

Operating Income 172 132 40 30%

Operating Expenses (102) (104) 2 -2%

Income Before Tax 70 29 41 142%

Tax (21) (9) -12 133%

Profit After Tax 49 20 29 146%

Cost to Income Ration (CIR) 53% 61%

Non Funded Income to Total Income (NFI/Total Income) 31% 29%

Q1 2020 Perfomamnce % Variance

COVID–19

IMPACT ASSESSMENT04.

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NMB RESPONSE TO COVID-19 IMPACT

Staff

Continuouslyeducating staff on best practices to combat Covid-19 outbreak

Provided staff with protective gear (Face Masks, and Hand sanitizers)

Split staff in three groups; Work from Home, Work from Disaster Recovery site, and Work from HQ building

Insist on social distancing among staff and guide customers accordingly

Business Continuity

Activated Business Response Forum to ensure strategy re-calibration for business turnaround

Activated Crisis Management protocols and regular monitoring at ExCo level via Crisis Management Meetings

Clients

Promote the usage of digital and self-service delivery channels

Relief to customers through restructuring of loans

Monitor quality of the SME, MSME and Corporate loans portfolio to limit expected impairment impact

Overall

Businesses have started to re-open. Government has issued assurances; No lockdown

Strong business ties with salaried government employees and government has maintained stability throughout

Strong capital position to absorb anticipated impact

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05. Q&A

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2019 DIVIDENDS 06.

26

2019 DIVIDENDS

TZS 96Per Share

TZS 48BN

NMB Board proposes dividend payment of

This is in accordance with the Bank’sDividend policy, as stipulated in theArticles of Association, to pay one-third(33%) of profit after tax as dividend andretain 66% of profit to strengthen thecapital base and for investmentpurposes

Analysis done by managementindicate no significant impact onthe capital position after thedividend payment to the totalcapital position of the bank

104 104

64 66

96

0

20

40

60

80

100

120

2015 2016 2017 2018 2019

4852 52 32 33

Total DividendTZ’ Billion:

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DISCLAIMER

“NMB Bank Plc (“NMB”), has taken all reasonable care to ensure that this presentation is true andcorrect in all material aspects. This presentation and any other information supplied is not intended toprovide the basis of any evaluation or as a recommendation by NMB, nor does it constitute an offer,to sell or buy any NMB shares. Any recipient of this presentation should make its own independentassessment of the condition and affairs of NMB. This presentation may include “forward lookingstatements” which includes all statements other than historical facts and data, including statementson the banks financial position, strategy or other plans and possible future scenarios. Suchstatements, if any, are not guarantees of future performance, and involve known and unknown risksand factors that could cause the actual results to be materially different from the forward-lookingstatements. No responsibility is accepted for the reasonableness of any such forward lookingstatements. NMB does not represent that this presentation may lawfully be distributed in anyjurisdiction, and this presentation may not be re-distributed except with the express approval ofNMB.”

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