CRDB Bank: AFRICAN

CRDB Bank has established itself as a leader in Tanzania's financial sector by providing customer-oriented services and prioritizing its people. Its approach not only strengthens the bank but also contributes to the country's economy. CRDB's commitment to youth, women, and small business owners sets it apart from its competitors. It achieves this by designing products that target young people from a young age. The bank's Group Chief Executive Officer and Managing Director, Abdulmajid Mussa Nsekela, recently emphasized its desire to empower the youth by enabling them to engage in meaningful economic activities and productivity.

From fulfilling its community social responsibility to providing tailored financial products and supporting small and medium-sized enterprises, CRDB has endeared itself to the people and bolstered the national economy, resulting in numerous accolades from Tanzania and the international community. In an interview with African Leadership Magazine, the Managing Director of the Bank highlighted some of the institution's significant accomplishments, such as securing a partnership program worth $100 million with the United Nations that aims to benefit approximately six million people.

CRDB recently reported a net profit of about 31 percent in 2022, and this, no doubt, points to your incisive leadership at the bank. Can you share some of your efforts towards building CRDB into one of the most profitable banking brands in Tanzania and East Africa at large?

"Well, the results you see are a product of the hard work and dedication of the staff of CRDB Bank and the trust that our customers have in us. As a leader, I am proud of what we have accomplished as a team, and I remain grateful to our stakeholders, our board of directors, my colleagues at CRDB Bank, and above all, our loyal customers.

Over the past five years, we have been undertaking strategic reforms to align our group for growth. I am happy that the financial performance, alongside other transformations, are the tidings of these reforms, and today, CRDB Bank is best-positioned to be the undisputable leader in the industry and in the region.

More importantly, we have invested in a responsive business model that puts the customer at the center of everything we do. Our medium-term strategy fully recognizes our long-term ambitions and has considered the market risks that continue to shape the business environment. I am confident that the bank will perform even better in the coming years.

Last year, the CRDB signed a $60 million financial package comprising $50 million in subordinated debt to support the bank's regional expansion efforts and a $10 million senior loan to accelerate access to finance for small businesses managed and owned by women in Tanzania. Can you tell us how these funds will accelerate your planned expansion program and the growth of womenled small businesses in the region?

"CRDB Bank prides itself as a champion of financial inclusion in Tanzania. We have several products tailored for the underserved segments of the population, especially women and youth. We are also a market leader in lending to small and medium enterprises since we view SMEs as the engine of growth for the Tanzanian economy

The subordinated debt will augment our financial capital resources to grow these two portfolios, which are the center of our focus in the medium-term strategy for 2023–2027. We are keen on leveraging value chain financing for SMEs, especially those in the key sectors of the economy, with a broader view of supporting the economic transformation agenda.

We have placed a high premium on women-led enterprises because we know the potential that lies therein. Our experience has shown us that women-led enterprises have a higher propensity to succeed and have a multiplier effect on society in

terms of value distribution".

CRDB's digital transformation strategy is helping to promote the country's financial inclusion agenda. Can you share some of the bank's milestones in this regard?

"Our success in recent years has been buoyed by our ability to provide convenience to our customers in a cost-effective way This was the main goal of the digital transformation strategy, which targeted expanding our reach and deepening access to financial services. We continue to invest in scalable technologies while at the same time strengthening our distribution network to reach the rural population.

The milestones achieved over the past five years include successfully expanding our digital banking services through our proprietary SimBanking platform and mobile banking options. Today, our customers can open and operate bank accounts through their mobile phones. We see this as revolutionary because it allows us to reach more people effectively and efficiently

Secondly, we have significantly grown our agency banking network (CRDB Wakala), from just above 5,647 in 2018 to more than 22,000+ in 2022. This is the largest agency banking network in the country, providing services to more than two million Tanzanians every month. For us, this is a big breakthrough since it eliminates the cost of brick-andmortar branches.

With these expansions, we have been able to onboard many customers, further deepening access. As a result, we have also grown our credit portfolio by providing digital loans to customers who previously lacked access to financial services. This has had a multiplier effect on households and livelihoods".

SMEs are the engine room for sustainable economic growth and development, and CRDB Bank has an extensive history of supporting these businesses in Tanzania and other markets. Can you share some of the strategic outcomes of the bank's sustained support for small businesses in the region?

"Our growth strategy is premised on the simple principle that for us to grow sustainably, we have to empower people to invest and generate income from various activities within the wider economy The structure of our economy is still heavily driven by agriculture and trade, and so we have modeled our support for these sectors along their value chains.

Our focus in the agriculture sector is staggered along the entire value chain, from farm inputs to financing solutions to address the capital challenges, especially for enterprises providing services to the government or those engaged in trade and agriculture value addition. This continues to transform households and has contributed to improved liquidity in the economy".

With the growing demand for green investments on the continent, can you share some of the Bank's efforts to support green projects in the region?

“At CRDB Bank, we see ourselves as an environmental steward in Tanzania and the region. Over the past years, we have made deliberate investments in building our capacity to create impact and contribute to charge a lower interest rate to customers by as much as an estimated 60% below current market rates while maintaining their target spread over their cost of funding.

We work closely with the nationally designated authority, the Ministry of Environment in Tanzania, in identifying projects and programs that contribute to the national goals on climate action.

In addition to this, we have integrated an environmental and social management framework into our corporate lending, especially towards big projects. In our appraisals, we assess the impact of individual projects on the we have also grown our credit portfolio by providing digital loans to customers who previously lacked access to financial services. This has had a multiplier effect on households and livelihoods harvesting, storage, post-harvest processing, and marketing. We have created partnerships with governmental institutions and foreign companies to create ready markets for local products and raw materials. Principally, we are the biggest lender in the agriculture sector, with loans constituting about 646% of our retail portfolio.

The outcome of these efforts is increased agricultural productivity, especially for commercial crops such as coffee, cashew, and tea. We have also seen improved incomes for farmers, who are now able to repay their loans, as seen in the low ratio of our non-performing loans.

For SMEs, we have developed global efforts towards climate action.

We are the first commercial bank in Tanzania and the fourth on the continent to be accredited by the United Nations' Green Climate Fund (GCF) to champion green financing. Already, our first proposal, titled Tanzania Agriculture Climate Adaptation and Technology Deployment Program (TACATDP), got approved by GCF for financing to the tune of $100 million. The program targets smallholder farmers engaged in farming practices that promote climate adaptation in Tanzania and is expected to benefit more than six million people over the next five years. GCF's funding allows CRDB to

environment in the long term".

As a seasoned banker with over 20 years of experience in retail, commercial banking, banking operations, and control functions, what would you say are your biggest achievements?

"Well, for any professional banker, leading a successful enterprise is an achievement big enough in one's career. But I would say that I am proud to have played a role in the transformation of the banking sector in Tanzania. Although not an individual effort, I am happy that I have donated my knowledge, skills, and experience towards the betterment of the financial services industry both as a professional banker and as a captain of the industry. We have witnessed tremendous reforms in the industry, all of which are the results of extensive engagements and collaboration with multidisciplinary stakeholders, regulators, and peers"

As the world's largest reservoir of young people, Africa's biggest assets are its young people. How is the bank supporting young people in the region?

"CRDB Bank is passionate about young people. We are among the leading banks in the region, with more products targeting young people from their tender ages. We have integrated this into our sustainability strategy as a focal point, understanding that to build a wider pool of our customer base, we must empower the young into meaningful economic activity and productivity

We have programs specifically designed to address some of the challenges facing youth, such as unemployment and drugs. Through our social investment programs, we engage youth through sports. We support career sports such as basketball and football. We also provide scholarships for deserving students to help them pursue higher education.

Through our financial inclusion initiatives, for example, we have youth entrepreneurship programs undertaken in partnership with other institutions or organizations of goodwill, including innovation hubs, with the aim of building capacity for young people in tech and entrepreneurship".

Can you share some of the bank's philanthropic strides across its markets?

We have a social investment strategy anchored in four pillars: education, health, the environment, and youth and sports. These four pillars guide our philanthropic activities across all our markets. We chose the pillars based on our understanding that these areas are integral to the development of any society. We invest in health because we believe that for people to be productive, they must be healthy

Every year, nearly 60% of our annual CSI budget is spent on health causes, including the purchase of hospital equipment and building amenities such as wards. We also donate sums of money towards medical procedures for infants with congenital heart include annual tree-planting fairs and urban clean-ups"

As one of the continent's lights, you have contributed to a massive change in the financial system of Tanzania. What do you have to tell the young people who aspire to be where you are today?

"My counsel to the youth would be to ask them to trust the process. The banking profession is a highly specialized career that requires one to learn and master their area of specialization. More importantly, they should endeavor to learn and acquire diverse knowledge because the world is changing rapidly, and if one doesn't upskill, he or she may be rendered irrelevant in a shorter period of time. Above all, endeavor to build credibility through your work problems. We do this in partnership with reputed institutions like the Jakaya Kikwete Cardiac Institute (JKCI) and Ocean Road Hospital in Dar es Salaam.

One must link what they do with the impact it has on the people around them or the community at large, as this is also a good measure of success. Doing this will grow you and prepare you better for the days ahead".

We also have an annual marathon that serves to raise funds from partners and institutions of goodwill. Proceeds from this annual activity are channeled towards a social cause in the health sector

Our passion for the environment has led us to create a strong footprint across our markets through tree planting. We have integrated this into our culture, and all our branches and subsidiaries take it as a practice to take care of the environment. Our main activities

You have been invited to speak and receive the African Leadership Council award. What does this mean to you and CRDB?

"For CRDB Bank, this means our impact creation ambition is bearing fruit. We are proud to be counted among influential brands and happy that we are making a meaningful contribution to the economic emancipation of our continent.

For me, it is an honor and privilege to represent my colleagues at CRDB Bank. I carry the pride of the men and women at CRDB Bank, who put in hours of their lives to serve our customers, irrespective of the challenges around us. I am merely their agent; therefore, this is a moment of pride for all of us at CRDB Bank".