Stanbic Bank CEO on Tanzania's growth prospects, banking sector outlook

Tanzania's economic landscape has been the focal point of many discussions lately, especially in the banking sector. Manzi Rwegasira, the CEO of Stanbic Bank Tanzania, recently shared insights on the bank's outlook on the country's economic future in an interview with CNBC Africa. With the central bank rate fixed at 6 percent in June and GDP growth projections at 5.6 percent, the banking sector seems to be on a positive trajectory. Rwegasira highlighted the growth of the banking industry in recent years, with private sector credit growth hitting double digits and NPL ratios declining. The renewed confidence among corporations, investors, and consumers has been a driving force behind this growth. Looking ahead, Rwegasira believes that banks will continue to be a significant driver of economic growth in Tanzania. While discussing the potential risks in the sector, Rwegasira acknowledged the existence of both exogenous and internal factors. Geopolitical risks, such as tensions in regions like Russia and Ukraine, remain a concern as they could impact energy prices and, consequently, the economy. Rwegasira emphasized the importance of managing currency risk to protect assets and customers from foreign translation losses. Stanbic Bank advises clients to avoid mismatches between their inflows and outflows, ensuring a prudent approach to currency risk management. Despite currency fluctuations, interest rates in the region have remained stable, which has affected foreign direct investments (FDIs). Rwegasira highlighted the importance of capital flow into the Tanzanian market and outlined Stanbic Bank's efforts to attract investments while safeguarding against macroeconomic and currency-related risks. As a pan-African bank with operations across the continent, Stanbic sees Tanzania as a promising investment destination with growth potential, particularly in sectors like energy and infrastructure. The recent upgrade of Tanzania's credit rating to B-plus with a stable outlook showcased the country's economic stability and growth prospects. Rwegasira identified energy and infrastructure as key sectors for banking investment, citing ongoing developments and investments in these areas. Overall, the CEO of Stanbic Bank Tanzania remains optimistic about the country's economic future and the opportunities it presents for investors and banks alike.