TBP Bank, Twiga Bancorp merge to create strong bank

The approval came after the government, filed for an application to merge the two in a bid to salvage Twiga Bancorp that went under and put under the BoT supervision since October 2016.

BoT’s Deputy Governor Bernard Kibesse said, the operations, liabilities, assets and staff of Twiga would be merged with TPB bank starting today.

“No new capital will be injected to TPB…it is well capitalized. “The two are merged to increase efficiency and stability,” Dr Kibesse told reporters at central bank headquarters. He said, nothing would be lost for Twiga’s customers including their deposit interest yields.

He said, starting today the central bank will be relieved from management of Twiga Bancorp and all affairs will be under TPB Bank—one of the fastest growing mid-sized banks in the country.

“This measure has been taken to improve the oversight and performance of banks owned by the government,” Dr Kibesse said. Twiga Bancorp was put under statutory management of BoT since October 2016 following its undercapitalization status.

The central bank at one time sought an investor to take over the ill-fated bank, but none come forward. After the merger, TPB Bank will be retained whereas customers, employees, assets and liabilities of Twiga Bancorp will be transferred to the newly formed TPB Bank Plc. TPB has shown its intention to list its shares at Dar es Salaam Stock Exchange (DSE).

Twiga Bancorp, before put under BoT supervision made the first profit in the first half of 2016 after five years of loses. The bank had 150 workforce serving six branches in Dar, Mwanza, Arusha and Dodoma.

Twiga went into operations in 1998 as a non-bank financial institution.

Meanwhile, BoT’s Deposit Insurance Board Operation Manager Rosemary Tenga said, the board has paid 60 per cent of deposits of five axed banks in January.

She said, currently the Board was auditing the five banks before embarking into the final stage of liquidating the banks. “The auditing exercise expected to be completed at end of the next month [June] if everything remain equal,” MsTenga said.

The main challenge, she said, was the depositors of the said banks to come forward and received their rights. The five banks that licence were axed are Covenant Bank for Women (Tanzania), Efatha Bank, Njombe Community Bank, Kagera farmers Cooperatives Bank and Meru Community Bank.

Tanzania has over 40 banks but its financial services sector is dominated by lenders such as CRDB Bank and NMB Bank.

Source: Daily News

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