In a significant development for the country's mortgage refinancing sector, Absa Bank Tanzania has emerged as the latest shareholder in the Tanzania Mortgage Refinance Company (TMRC), injecting a substantial investment of 1.6 billion Tanzanian Shillings.
With this investment, Absa Bank Tanzania secures a six percent stake in TMRC, representing approximately one million shares, solidifying its position as the 19th shareholder in the company.
Oscar Mgaya, the Chief Executive Officer of TMRC, expressed appreciation for Absa Bank Tanzania's decision to join the consortium of shareholders, emphasizing the meticulous process involved in reaching such a significant milestone, which included obtaining approval from the board and other stakeholders.
"We are pleased to welcome more banks into the TMRC fold, a move that broadens the scope of mortgage financing," stated Mgaya during a ceremony held to mark Absa Bank Tanzania's entry into TMRC, held in Dar es Salaam.
TMRC serves as the mortgage liquidity facility within the country, extending long-term funding to financial institutions for mortgage lending purposes, currently servicing 31 financial entities.
Mgaya highlighted that Absa Bank Tanzania's participation elevates TMRC's total investment to 27.5 billion Tanzanian Shillings from 19 shareholders, urging other financial institutions to follow suit to facilitate wider access to mortgage loans across the country.
Absa Bank Tanzania's Chief Executive Officer, Obedi Laiser, expressed enthusiasm for the bank's newfound role as a shareholder, underlining the significant investment of 1.6 billion Tanzanian Shillings and the potential for further contributions.
"We are delighted to become shareholders today...this marks a memorable moment for us. It's better late than never," remarked Laiser, emphasizing the bank's commitment to expanding access to affordable, long-term mortgage financing for Tanzanians.
Laiser underscored the objective of bolstering mortgage lending in Tanzania, aiming to address the housing needs of citizens and support the government's initiatives aimed at ensuring improved housing accessibility.
"This partnership enables us to access increased long-term funding, from 5 billion Tanzanian Shillings to 32 billion Tanzanian Shillings, which will be channeled towards meeting the growing demand for housing loans among our customers, addressing the housing challenges confronting many Tanzanians today," concluded Laiser.
Absa Bank joins other financial institutions’ TMRC shareholders including CRDB Bank Plc; NMB Bank Plc; National Bank of Commerce Ltd (NBC); TIB Development Ltd; Azania Bank Plc; Exim Bank (T) Ltd and DCB Commercial Bank Plc. Other financial institutions’ TMRC shareholders include BancAbc Ltd; Bank of Africa (T) Ltd (BOA); First Housing Finance Ltd; Peoples Bank of Zanzibar Ltd (PBZ); I&M Bank (T) Ltd; NCBA Bank Ltd , Mkombozi Commercial Bank Plc and Mwanga Hakika Bank(MHB).
Other TMRC shareholders include, National Housing Corporation (NHC) and International Development Finance Institutions (DFIs) such as Shelter Afrique (an African Development Bank Group housing finance institution) and the International Finance Corporation (IFC) which is part of the World Bank Group.
By Absa Bank joining TMRC, the bank will have access to funds for mortgage purposes from TMRC as part of its strategy to grow its business through the issuance of mortgage loans.