Agribank positive about 2018

OGONE TLHAGE

Agribank CEO Sakaria Nghikembua says the lender is looking to make the most out of the resurgence of the agriculture sector.

While the economy has not performed well over the last year, he said the situation was poised to turn for the better and to prepare adequately, Agribank would aim to diversify its loan portfolio and grow its market share.

According to him, agriculture commodities prices and sales volumes across the board have shown a persistent rising trend throughout the year and maintained high levels compared to the previous year.

“This is particularly on the back of improved production and high demand in the local and export markets, favourable prices and trading conditions,” Nghikembua said.

Looking ahead, he said the economy would perform well in 2018 and 2019 with growth of 2.2% and 2.4% expected respectively, largely because of recoveries in the agricultural sector and growth in the mining and tourism sectors.

With improvements expected in the broader economy, he said the positive effects would spill over into the agriculture sector.

“The trend in agricultural product prices is projected to improve; hence the agricultural sector is anticipated to strongly support growth. Expected growth in the agricultural sector is partly a response to the end of the El Nino drought that plagued the Southern African region for two consecutive periods,” Nghikembua said.

To prepare for the buoyancy of the agriculture sector, Nghikembua said Agribank would have to modify its business plan somewhat due to the depth of competition in the banking sector.

From a business perspective, Agribank operates in a dynamic environment faced with fierce competition in the financial intermediation market, uncertainty in climate change, economic conditions as well as disease and pest outbreaks.

Agribank would roll out more products for farmers, he said.

“This has prompted the bank to strengthen efforts aimed at increasing our market share, diversifying our loan portfolio, improving loan collections, building brand loyalty, while mainstreaming risk management in our business operations,” Nghikembua said.

This, he said, would also help increase Agribank’s market share.

“In terms of business prospects, we foresee growth resulting from a second consecutive year of normal rainfall. This is supported by a continued upward trend in producer prices across agricultural products. We therefore look forward to growth in our market share over the next two to three years,” he said.