Malawian Bank, FDH, eyes Zambia, Mozambique financial markets


FDH Bank PLC is reportedly eyeing to set up base in Zambia and Mozambique as part of its long-term expansion strategy.

The bank claimed to have conducted market surveys in Zambia and Mozambique to assess the feasibility of penetrating the regional markets.

Read more: Bank of Zambia rates country’s financial sector performance good, as bad loans below 10 percent

According to Nation Online, the bank’s Managing Director, Noel Mkulichi, said this on Tuesday in Blantyre during the second FDH Bank Investors’ Forum.

In his presentation, he said the Malawi Stock Exchange (MSE)-listed bank wants to tread carefully as it conducts market research to minimise the risks that could affect equity holders.

“The markets are different in terms of legal and business environment, so we need to analyse further before investing.

“We are currently assessing the Zambian market and we will see whether there will be an acquisition. Last year, we went to Mozambique for a similar mission, but for now we are still doing the study,” Mkulichi said.

If FDH Bank PLC successfully manages to penetrate the regional markets, it would be among the three MSE-listed firms that have subsidiaries accross Malawi borders.

Board Chairperson, Charity Mseka, said the bank had revisited its strategy, adding four pillars that could enable it achieve the expansion ambition and develop resilience from current economic threats.

She said the pillars, namely customer focus, operational efficiency, people development and continuous innovation, would ensure the bank overcomes current exchange rate volatilities, inflation pressure and foreign exchange scarcity risks that are expected to continue in 2024.

“These pillars could also enable the bank to utilise the available opportunities like the economic recovery-related private sector credit growth that would see the bank increasing its lending to private sector apart from the said regional expansion drive,” Mseka said.

However, despite shareholders and stakeholders receiving the regional expansion news with excitement, investment analysts highlighted the need for the bank to conduct thorough feasibility studies before making a decision.

Stockbrokers Malawi Limited equity investment analyst Kondwani Makwakwa said the bank’s interest to expand regionally showed that the local financial sector was maturing, but urged thorough feasibility studies before making a final decision.

FDH Bank PLC, a subsidiary of FDH Financial Holdings Limited, listed on MSE on August 4 2020, with an Initial Public Offer price of K10. The share price is now at K65.11.

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