This article is sponsored by TDB Group
During the proceedings of the Annual General Meetings, H.E. Ernesto Max Elias Tonela, Minister of Economy and Finance of the Republic of Mozambique, was elected as the new TDB Chairperson of the Board of Governors.
TDB Group President and Managing Director Admassu Tadesse expressed gratitude to the Mozambican government for hosting the meetings. Reaffirming the Bank’s commitment to the country and region, Tadesse said that “Mozambique is strategically located and helps facilitate the competitiveness and connectivity of other member states in the sub-region,” he said, citing the country’s unique location on the Indian Ocean.
Presenting a report on TDB Group’s performance, Tadesse said that in spite of the challenging global macro and political environment, the Group, with its different subsidiaries and strategic business units – Trade and Development Banking, TDB Asset Management, ESATAL fund management company, TDB Captive Insurance, the Trade and Development Fund, and TDB Academy – was able to post significant improvements over the previous years and reach some record milestones. “We are very pleased to report that our total assets during this period managed to grow by 21% year-on-year, crossing the USD 10 billion mark for the first time in 39 years. Similarly, our total equity, including reserves, rose robustly by 13% to USD 2.2 billion and on the back of that, our net profit also grew by 11% to a historic level of USD 230 million, generating an attractive return on equity of 11% to shareholders.”
The Bank also maintained the good quality of its assets, containing non-performing loans at 3.6%, and maintaining a capital adequacy level of 35%. The portfolio remained resilient mainly due to proactive portfolio management strategies and robust risk management practices in place. As a result, the Bank’s investment-grade credit ratings were affirmed by credit rating agencies such as Moody’s and GCR. “The credit agencies highlighted our strong capitalization and our dynamic use of credit enhancement and risk mitigation instruments. They also took account of our strong governance and risk management, our track record, and our diversified funding sources, including very high-quality liquidity buffers that have proven to be very valuable in these complex times,” he noted.
Tadesse expressed satisfaction with the group’s success in securing several sustainability-linked facilities with strategic partners during 2023. Additionally, the group tapped into syndicated loan markets when capital markets were closed, managing to attract USD 2.3 billion of financing on the debt side of the balance sheet. “We are also pleased to report that even in these adverse conditions TDB Group’s shareholders continue to demonstrate their confidence in the institution, with many recapitalising their dividends as they have been doing for many years, reaching a record level in the year under review,” he said.
In a recorded message, Dr Akinwumi A. Adesina, President of the African Development Bank Group commended the Trade and Development Bank (TDB) Group for its impressive progress under the leadership of Admassu Tadesse, which has seen the Group win several awards and endorsements, including an award for African banker of the Year earlier this year at the prestigious African Banker Awards. “I applaud the Group’s efforts in helping to bridge severe gaps in access to trade finance in Africa’s least developed economies,” he said.
Adesina stressed the importance of maintaining focus on TDB Group’s core mandate of bridging the trade finance gap in Africa and continuing to innovate for transformational impact. Adesina assured TDB Group of the continued support of the African Development Bank, highlighting their strategic partnership in accelerating Africa’s development goals.
Dr. Victoria Kwakwa, Vice President, Eastern and Southern Africa at the World Bank Group, emphasised the World Bank’s appreciation and commitment to its strong partnership with TDB Group, which began in 2020 with a special purpose facility of USD 415 million focused on renewable energy and off-grid solutions. She also noted that the World Bank expanded its efforts with an additional USD 300 million to support private sector investments in distributed renewable energy and clean cooking projects in TDB member countries. Additionally, the Multilateral Investment Guarantee Agency partnered with TDB through guarantee facilities to support trade finance expansion. “The combined aggregate facilities from IDA and MIGA to TDB Group are close to USD 1.5 billion and include new cooperation with the Trade and Development Fund,” Kwakwa pointed out.
H.E. Albert Muchanga, African Union Commissioner for Trade and Industry, called on African governments to step up their support for African development finance institutions, highlighting the development impact of TDB Group. “We are calling on all member states to allocate at part of their foreign exchange reserves into the African financial institutions to enhance their financial base for on-lending to us,” he said.
Delivering the keynote address, H.E. Dr. Adriano Afonso Maleiane, Prime Minister of the Republic of Mozambique, emphasised the importance of the TDB Group’s efforts in addressing critical issues such as financial, energy, food security, and climate change, noting the collaboration with African multilateral institutions like the TDB Group to finance transformative initiatives, particularly in agriculture and energy sectors. He called for continued collaboration and innovative solutions to accelerate sustainable and inclusive development. Maleiane encouraged investment in education, technical training, and entrepreneurship to prepare the youth for future challenges and expressed optimism about achieving economic growth with the support of the TDB Group and other partners.
Maleiane also praised the TDB Group’s instrumental role in financing key projects across various sectors on the Mozambican economy, including agriculture, infrastructure, energy, transportation, and logistics. “We acknowledge the efforts made by the TDB group and other partners in providing support and assistance to our countries and ensuring continuous socio-economic development that impacts citizens’ lives,” he remarked in his intervention.
H.E.Tonela, added that “TDB Group has done this through investments in modern agricultural technologies and sustainable practices. This has contributed to improved productivity and resilience to climate change,” he said.
As has become custom at the AGM, the Group donated a grant to a deserving project, as part of its corporate social responsibility activities. This year, TDB Group is honoured to support the “Project for the installation of a solar water pumping system for irrigation of agricultural fields and cattle drinking in Salane” in the district of Mapai, Gaza Province, through the FUNAE Energy Fund with a grant of USD 100,000 to the Associação Lhuvukane Varime ni Vafuyi Macandazulo-Salane.
This initiative addresses some critical challenges faced by the community due to climate change, including the seasonal nature of their primary water source and the high costs and environmental impact of diesel water pumps.
By providing a solar water pump, additional water storage tanks, and necessary irrigation infrastructure, the project aims to enhance food security, increase household incomes, empower women economically, and overall improve the support is expected to improve the quality of life for the 1,570 families in Salane.
Commenting on the Group’s activities, Ms. Joy Ntare, Group Vice President and Deputy Managing Director, added that across all of the group’s activities, “with every project that the Group underwrites, we make sure that its development impact is understood, including in terms of the people it touches and jobs it creates, and that issues around governance, environmental and social impact are addressed.”