By MAIMBOLWA MULIKELELA –
THE Development Bank of Zambia (DBZ) will this year release about K400 million for onward lending to Small and Medium Enterprises (SMEs), managing director Jacob Lushinga has said.
Mr Lushinga said the bank would disburse not less than K400 million from its own resources to key priority sectors such as manufacturing, construction, mining, tourism and agriculture.
Speaking during the Zambia Association of Chambers of Commerce and Industry (ZACCI) chief executive officer’s breakfast meeting in Lusaka yesterday, Mr Lushinga said the bank last year received a total of US$20 million (K104.6million) from the Euro Bond out of which, K58 million was disbursed to SMEs.
He said 21 projects worth $8.8 million (K49million) were also approved and that, K99 million in terms of commitment has so far been exhausted.
‘‘More than 50 per cent of the funds has been disbursed in forms of loans and currently we have exhausted the funds in terms of commitment worth K99 million and we have disbursed about K58 million to the SMEs,’’ Mr Lushinga said.
Giving an overview of the bank’s performance in 2013, Mr Lushinga said out of the $20 million Euro bond, $4.4 million was disbursed as at December 2013. ‘‘The balance of the Euro bond proceeds stood at K55.6 million, a total of 40 projects with a total value of approximately K93.5 million and $33.7 million were earmarked to be considered for disbursement during 2014,’’ he said. Mr Lushinga said out of the 40 projects to benefit from the Euro bond includes 14 projects from commerce and trade amounting to K38, 115,500, agri-business would also get K33, 020, 013.
Meanwhile, the bank invested a total of K305.5 million to various sectors of the economy, with direct lending standing at K212.4 million as at December 2013.
Out of this amount 88 per cent was derived from DBZ funds, while 12 per cent was from the Euro bond fund.
A total of 26 loans were booked under direct lending, spread across all sectors, with the construction accounting for the largest part of the loan portfolio at 29 per cent, followed by manufacturing at 22 per cent. He said as at December 2013, a total of 6,132 jobs were created through DBZ of which 947 were direct jobs and 5,185 were indirect.
Speaking at the same event, Bankers Association of Zambia (BAZ) chairperson Shankardas Gupta said growth of the deposits was not significant in 2013 and that, it was too small to carter for the demand of the economy.
Mr Gupta said given the current scenario, the lending rates have gone up following an increase in the policy rate from 10.25 per cent to 12 per cent, representing an increase of 1.75 per cent.