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Saturday, August 2, 2008

NMB IPO

Dear Forum Memmbers and fellow Tanzanians,
Some of you may already know this, but most Tanzanians don't. The Government is planning to sell 21% of the 51% of the NMB shares it holds. The Initial Public Offering, IPO is expected to take off before September 2008.

Currently, the shareholder profile for NMB is:

  1. The Government of the United Republic of Tanzania 51.0%

  2. RABO Bank 34.9%

  3. National Investment Company Limited (NICO) 6.6%

  4. Exim Bank Tanzania 5.8%

  5. Tanzania Chambers of Commerce Industries and Agriculture (TCCIA) 1.7%


(Source, NMB Website)

For more information read http://www.ippmedia.com/ipp/guardian/2008/05/26/115169.html.

Only Tanzanian citizens and Tanzanian owned institutions are allowed to bid for shares during the IPO. The aim is to enable Tanzania to take ownership of private companies that were previously stated owned. Once the stock gets listed on the DSE then it is fair game for everyone.
It is sad that most Tanzanians are still in the limbo in regards to the NMB shares. THe NMB IPO has been talked about for a while, but it was not common knowledge to most Tanzanians; even those working in the financial sector, while our neighbors in Kenya were already talking about obtaining these shares as early as May, 2007. Just read


It is high time Tanzanians became more informed about such important things in our country's development and economy, and show we can compete in the EAC. Our Kenyan friends have even gone as far as mocking us and accuse us of xenophobia because of the restrictions imposed on the IPO. So let us make full use of this opportunity; disseminate this information widely!!

10 comments:

Mujwahuki said...

Good reminder Mr. Nalitolela! Let us participate in this IPO not because we are being mocked by our friends who are ahead of us in these issues, but becaues it is part of our financial plan to move from one point to another better point. And remember that investing is not a race, everyone has his/her own financial plan and destiny and own pace of reaching there! Of course the faster the pace the better!

Three main reasons for taking up this IPO offer and other offers: Investing for capital growth, investing for regular income (dividend), and speculation on short-term price gain. The first reason, calls for a thorough reading of the the offer document (prospectus), and analysing various fundamentals and all potential risk factors (don't forget employees claims!!). In short you are looking to become a part owner of the company/bank.

The second reason requires the same analysis, but with less intensity, because you will try to figure out the dividend policy and its sustainability.

The last reason is, fortunately or unfortunately where most naive Tanzanian investors may be categorised. Here is when we buy shares even not aware of what is written in the fine prints of the offer document.

Incubent investors advise that you can be in any of the above category, though much weight should be skewed more towards the first reason.

Kila mtu ana mipango yake kifedha, nimejaribu kutoa tu uzoefu wangu binafsi kwenya haya maswaala.

Mujwahuki

Nalitolela, P. S. said...

Good point Mujwahuki,
I totally agree with you; it was not my intention to imply that we should buy only because Kenyans are interested or because they are mocking us. What I meant is that, people should know about this thing, they should be thoroughly informed and be in a position to make a decision as to whether they should invest or not. In a post preceding this one, titled How to Price Shares we discuss a few points about the kind of analysis a prospective investor should do before they decide to partake in such a venture

Mliakuvana said...

"It is sad that most Tanzanians are still in the limbo in regards to the NMB shares."
This statement I think should be that most Tanzanians are still in limbo in regards to the stock market in Tanzania despite its limited listings.

"It is high time Tanzanians became more informed about such important things in our country's development and economy, and show we can compete in the EAC."
Now this statement is a bit more like it - the question therefore, becomes; How? This is quite difficult especially when at the numerous maonyesho in Dar the CSMA and the DSM Stock Exchange pavilions receive very scant visitors.

I think one way of getting the news out there is through starting early in schools, especially by taking a good look at the subject of mathematics and introducing business math and finance math into the subject - let the colleges and financial institutions teach the professions but primary and secondary schools teach the skills - reading, writing, arithmetics.

If I remember correctly, there was a former minister of education who suggested this.....and we all know what hapened, don't we?

Anonymous said...

Hey,
Without secret, through my inner circle source of information on NMB, things are not going well and that was the big reason that the MoF decided to sell or open to the public some of its shares.
If you will read in depth the ROI generated by NMB last year, you will come across the facts that this sale of shares does not sound good.
With the information that I have, there was an urgent need of the MoF to have back or at least aquire some hard cash and make the bank liquidity instead of writing a blank check on the losses that it has encountered.Which they are afraid to reveal to the public that there bank is not doing or competing good.
The billions that are shown as bonus that it(the MoF) received were cooked to make it look that NMB is doing allright.
My point is- bear into mind that when you are inquring public to buy shares through Mkullo words, you are in one way or onother helping the Gov to pocket money from less knowledgeable citizens. Who will in turn invest or buy those shares and therefore in future run into madly finance investment.
Despite of us (Tanzanian) been lay back on shares buying or investment issue: one of the reason, is that our Gov tend to limit finance info on their own run banks. Many of local and International banks operates in TZ are truthfull and have openness environment that all of it shares are sold compared to NMB.
Many o the NMB shares are under Local governments authority and local gov cooperatives institutions.

Nalitolela, P. S. said...

Thank you for your comments dear members,
I would like to put forth a disclaimer that the post is for the purpose of conveying the information to the public, and it is not an advertisement for NMB. I advise people to do careful analysis and make informed decisions about whether to invest or not.

Anonymous said...

anony wa 12:40:00, r u claimin that financial statements published in the papers r false? m not refuting what u say, but the accounts r checked by an independent auditor; n last I checked the bank seemed 2 b doin well. I hope that's not just people who want to benefit only themselves tryin 2 scare others n start these conspiracy theories. I m sure Rabobank would b wise enough 2 get out of NMB if it weren' doin well.

al said...

Hao jamaa wanaojisifu eti ni wataalamu wa kununua shares Safcom imeishia wapi? kama sio ime-result into inflation kwa vile most Kenyans lended money from banks to buy shares and at the end of the day Kuwaitis fisadis wakanunua majority of shares (ufisadi at highest level),living the Kenyan market with too much money hence triggering inflation +26% and at the same time the expected profit from buying the Saf shares never to be realised (ufisadi at high level)leaving majority of Kenyans with a interest loans to pay. Thanks God our BOT Governor warned us.

If the reason of selling Safcom was expansion then hawa jamaa wamelizwa maana "realiable sources" tell hizo shares zimenunuliwa na jamaa wa Kuwait ambao ndio wana-own Zain sasa in real sense huwezi kumuuzia rival wako shares (i.e. Safcom & Celtel now Zain). Hii itakuwa-limit hawa jamaa in near by expansion projects haswa in EA Market

al said...

Anzisha topic ya Mineral Taxation in Tanzania, naona PWc wana TZ taxcards papers.

Ni muhimu maana hili swala linagusa uchumi wa nchi

Anonymous said...

Annoy wa Aug 04, 10:08:00 PM EAT.
Jaribu kufuatilia bank ya Ufaransa inayojulikana kama - French bank Société Générale - ambayo wali- uncover $7.14 billion US fraud — one of history's biggest fraud on banks.
Pamoja na kuwa na Financial statements zinazoonyesha faida kila mwaka na kupitiwa na Internal au External auditors au hata Independent auditors,bado loss au wizi huu ulikuwepo ndani kwa ndani.Hivyo serikali ya Tanzania kuomba kuuza shares zake za NMB kuna sababu za walakini na moja ya sababu za kujiokoa serikali ni kuuza shares zake kama benki ya Ufaransa na seriklai ya Ufaransa ilivyofanya au kujiandikia hasara.Kitu ambacho sio rahisi kabisa kufanyika hasa bank yenyewe inapokuwa NMB ambayo ndiyo bank kubwa kuliko zote Tanzania katika mifumo ya kibenki.
Unapoona banki kama NMB pamoja na ku-post faida na kugawa gawio lake kwa wanahisa bado serikali inabidi ijiondoe katika umiliki wa hisa zake maana yenyewe ndio inabidi ibebe hasara na kama bank ya kifaransa watafanya the same -
"Despite the writedown and losses, the company will post a net profit of $874 million to $1.16 billion US for all of 2007, the Paris-based bank said."
Hivyo mahesabu ya vitabuni sio kweli mara nyingi , jaribu fuatilia watu wa karibu na bank kwa uhakika zaidi, kwa kuwa bado hayo mahesabu hayajavunja sheria za kibenki. Kwani hutumia mwanya mchache waliopewa kuandika au kufunga vitabu vya faida au hasara kwa kila mwaka.

Nalitolela, P. S. said...

So the IPO takes off officially on Aug 18th according to Daily News