Postal Bank gets ready for DSE listing to raise share capital

BERNARD LUGONGO in Dodoma

TANZANIA Postal Bank (TPB) is gearing up to get listed on Dar es Salaam Stock Exchange (DSE) and float its shares to raise capital and transform all its operations from manual to electronic.

The state-run financial institution yesterday assured the Parliamentary Committee Accounts (PAC) that by May next year, it would have already been listed on the stock market. The bank’s move was in line with the finding remedy to the current weaknesses brought by the manual operations for some of the services.

The Controller Auditor General (CAG) report for the bank’s accounts ending December 2015 reveals several “human errors” that were blamed on manual operations. For instance, the report shows that computation on loans was done manually, which led to giving more loan amounts than what a debtor had applied for.

The Chairperson of the TPB Board of Directors, Professor Lettice Rutashobya, said the current bank’s manual system could not meet all transaction requirements.

“Currently, our financial capacity is too poor to meet all operations, since we do many things manually. And with manual operations, human errors are difficult to avoid.

This is why we are looking for more capital in order to strengthen our capacity for going digital,” she said. Kilindi MP Omari Kigua wanted to know measures that the bank would take to address the problem, arguing that operating manually exposes the bank to risks and errors.

TPB Chief Executive Officer Mr Sabasaba Moshingi said the bank is currently undergoing transformation that would see significant changes in its computation system.

“We are going to get listed on the stock market, and we have hope that Tanzanians would support us through buying the shares that would enable us get money for purchasing the new digital system,” he said. He affirmed that the new electronic system would be installed in all branches by end of this year.

However, the bank has recorded significant increase in capital for the past five years, from 8bn/ in 2010- to 42bn/- last year.

Treasury Registrar Lawrence Mafuru commended the bank for the growth and managing to get profit for the past three years. He said other public companies are supposed to emulate the same efforts shown by the TPB by going commercial so that they could help the government in collecting funds and thus achieve in implementing its development plans.

“There has been a conceptual idea that state-owned companies are not run commercially, it is good that the TPB has proved it wrong,” he said, noting that due such wrong mentality many public institutions have been operating on financial support from the government.

PAC Chairman Aeshi Hilaly directed TPB to ensure that it addresses all weaknesses indicated in provision of loans and carry out daily transaction reconciliation particularly on transactions done at Automated Teller Machines (ATMs).

Mr Hilaly further told the bank’s management to fast track installation of the physical security facilities in all its branches to keep the bank safe. The CAG report established that some of the branches of the bank lacked physical security facilities such as fire alarms, bullet proof kits and cameras