STATE-OWNED mortgage lender, National Building Society (NBS) has expanded into corporate and institutional banking.
The firm said last week that by entering into corporate banking, it wanted to play a part in Zimbabwe’s industrialisation.
In a speech read on his behalf by director of the Reserve Bank of Zimbabwe’s director of Supervision Division Philip Madamombe, the central bank governor, John Mangudya said the building society's move was a step in the right direction.
“NBS’ realisation of the strategic need for entering the corporate and institutional banking (CIB) space is a reflection of a deliberate strategy to align the business model to the vision of supporting industrialisation through offering a bouquet of corporate banking products and to enhance stakeholder value in a fast-changing world, thereby ensuring the long-term viability of the institution,” he said at the launch of the new product last Friday.
“This strategic thrust to on-board corporate and institutional businesses will help diversify the institution’s funding sources and strengthen the NBS balance sheet and thus contribute to institutional sustainability.”
Mangudya said global financial crises had revealed that banks were inherently fragile.
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“We trust that as NBS on-boards the corporate and institutional businesses, it will continue to strengthen its corporate governance and risk management systems in order to manage the attendant risks and give impetus to its mandate of contributing to national development through housing delivery and financial inclusion,” he said.
“Furthermore, as NBS repositions itself, it’s critical that it adopts sustainable banking practices and makes an impact in the corporate and institutional banking space.
“NBS should endeavour to profitably deliver sustainable social, economic and environmental solutions within its corporate and institutional banking activities.”
NBS managing director Tapera Mushoriwa said he believed the launch would ensure the society meets its national mandate and vision.
“We are a Zimbabwean bank,” Mushoriwa said.
“This is home, we understand the market and our current and future performance is tied to the same operating environment. We believe in banking focused on tailor-made solutions specific to your circumstances and aligned to your vision.”
Cognisant of the evolution in the digital world, Mangudya encouraged the building society to ride on the technology wave to optimise service delivery.
He said technology had inevitably become the future of banking.
Mangudya said the central bank, as regulator, emphasised the need for banks to keep pace with fintech through leveraging on big data and forging partnerships with technology firms to develop digital solutions at lower cost and increased efficiency.
“Let me remind you that most importantly, as banking institutions are the key pillars for savings mobilisation and resource allocation, payments infrastructure and economic development, the delivery of their services is primarily premised on trust, and as such have a fiduciary responsibility and duty to protect the integrity and reputation of the banking system, to engender public trust and confidence in the financial system,” he stated.