Kenya News

Shares in Tanzania's CRDB Bank up 33 pct on listing

DAR ES SALAAM, June 17 (Reuters) - Shares of Tanzania’s CRDB Bank rose 33 percent on listing on the Dar es Salaam Stock Exchange on Wednesday, after an initial public offering involving the sale of 18.8 billion shillings ($14.4 million) worth of stock.

The shares closed at 200 shillings having been offered at 150 shillings.

“Our listing is a sign of the success the bank has had in a long time,” said Martin Mmari, chairman of CRDB’s board of directors, during the listing ceremony.

The IPO, in which 125.4 million shares or 7 percent of the total were sold, was oversubscribed by 170 percent. The investment arm of Danish development agency DANIDA offloaded a 5 percent stake, leaving it holding 22.6 percent of the bank.

CRDB, which says it is Tanzania’s leading bank in terms of assets and loans, expects pretax profit to jump 19 percent to 71.43 billion shillings in 2009. It also sees net interest income rising to 106.15 billion shillings from 91.16 billion last year.

The bank will use the money raised in the IPO to expand its network from its current 58 branches, install automated teller machines and improve its IT infrastructure.

CRDB’s IPO raises the number of stocks on the DSE to 15, of which four are cross-listed from neighbouring Kenya. It raises the market’s total capitalisation by 600 billion shillings to 5.3 trillion, the DSE said.

Public interest in owning stocks in the nation of 40 million people has increased in the last few years, but the government says it is still too low.

“We still have few products listed on the DSE, we have a small investor base, the markets are to some extent illiquid,” said Jeremiah Sumari, deputy minister for finance and economic affairs. (Editing by David Holmes) ($1=1301.0 Tanzanian Shilling)