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Annual Report 2020 Shared Value Through the Times Contents ANNUAL REPORT 2020 SHARED VALUE THROUGH THE TIMES CONTENTS TO READ OUR DIGITAL COPY PLEASE 06 Our philosophy of growth SCAN THE QR CODE BELOW ABOUT OUR GROUP is underpinned by a strong conviction to orchestrate meaningful change and transform lives. For our Group, growth is defined by our sustained influence in society and, more 36 importantly, in the way we engage with the community and A REVIEWThis OF section OUR contains BUSINESSthe CEO’s thoughts on some pertinent the society at large. matters and recaps the year’s performance through the lens of our senior leaders. HEAD OFFICE (TANZANIA) Azikiwe Street Opposite Posta Mpya Postal Address 268, Dar es Salaam 52 Telephone: +255 222 197 700, Mobile: +255 714 197 700, OUR PERFORMANCE +255 755 197 700, +255 789 197 700 Email: [email protected], Website: www.crdbbank.com CRDB INSURANCE BROKER LIMITED To ensure the longevity of CRDB Bank House, Mikocheni Industrial Area Dar es salaam, Tanzania our Group we have modelled Telephone: +255 222 923 007/8 88 Mobile: ++255 758 000 024 our business around five key Fax: +255 222 923 006 CORPORATE GOVERNANCE Email: [email protected] sustainability themes, which - in our perspective - have a lasting impact CRBD BANK BURUNDI SA, HEAD OFFICE on our business. you can read more Rohero I, Chaussée du Prince Louis Rwagasore N ° 490/A BP 254, Bujumbura, Burundi about the themes on page 26 Telephone: +257 22 277 767/68 Email: [email protected] Website: www.crdbbank.co.bi 110 FINANCIAL STATEMENTS ABBREVIATIONS SHARED VALUE THROUGH THE TIMES SHARED VALUE THROUGH THE TIMES ABOUT THIS REPORT AC Amortized cost MNO Mobile Network Operators AGM Annual General Meeting MOU Memorandum of Understanding ALCO Assets and Liabilities Committee MSc Master of Science Directors Responsibility AML Anti-Money Laundering MSME Micro Small and Medium enterprises APF Local Authorities Pension Fund MUSE Mfumo wa Ulipaji Serikalini ATM Automatic Teller Machine N/A Not applicable The Board acknowledges BCM Business Continuity Management NBAA National Board of Accountants and Auditors, Tanzania its responsibility for BDO Business Development Officer NFI Non Funded Income BIF Burundian Franc NGO Non-Governmental Organization ensuring the integrity of BOT Bank of Tanzania NPL Non-Performing Loans this report. The Board has CAR Capital Adequacy Ratio OCI Other Comprehensive Income CASA Current and Savings Deposit Accounts OBIEE Oracle Business Intelligence Enterprise Edition considered the operating CCO Chief Commercial Officer OMC Oil Marketing Company context, strategy and CEO Chief Executive Officer OSHA Occupational Safety and Health Authority value creation model and CET Common Equity PAR Portfolio at Risk CFO Chief Finance Officer PAT Profit After Tax Reporting scope and boundary this report, in the Board’s CFP Contingency Funding Plan PAYE Pay As You Earn opinion, addresses all the CFT Combating Financing Terrorism PBT Profit Before Tax CRDB Bank Group Annual Report and Financial Statements have been issues that are material to, CIB CRDB Insurance Broker PD Probability of Default prepared for the period beginning 1st January 2020 to 31st December 2020. CIT Cash In Transit POF Purchase Order Financing This report extends beyond financial reporting and includes non-financial or could have a material CMT Crisis Management Committee POS Point Of Sale performance, our approach to risk management, an overview of our effect on, the Group’s COO Chief Operating Officer PSSSF Public Services Social Security Fund material risks and a summary of our governance and remuneration ability to create value. CSI Corporate Social Investments RMC Risk Management Commitee practices. It covers the Group’s business activities during the financial year CSR Corporate Social Responsibility ROA Return on Assets and provides a glimpse into the business prospects. CRDB Bank Group This report fairly presents DANIDA Danish International Development Agency ROE Return on Equity (the “Group”) comprises CRDB Bank Plc (the “Bank”) and its subsidiaries the performance of the DIA Director of Internal Audit S&P Standard and Poor’s CRDB Bank Burundi S.A and CRDB Insurance Broker Limited. DIF DANIDA Investment Fund SDGs Sustainable Development Goals Group. DKK Danish Krona SDGs Sustainable Development Goals Materiality DSE Dar Es Salaam Stock Exchange SME Small and Medium Enterprise EAC East African Community SMR Statutory Minimum Reserves We apply the principle of materiality in assessing what information EAD Exposure at Default SOA Service Oriented Architecture to include in our report, which focuses particularly on those issues, ECL Expected Credit Loss SPPI Solely Payment of Principal and Interest opportunities and challenges that impact materially on the CRDB Group EPS Earnings Per Share T Bills Treasury Bills and its ability to be a business that consistently delivers value to our ESB Enterprise Service Bus T Bonds Treasury Bonds stakeholders in a sustainable manner. EWS Early Warning System TIRA Tanzania Insurance Regulatory Authority EXCO Executive Committee TMRC Tanzania Mortgage Refinance Company Reporting Framework FSDT Financial Sector Deepening Trust TNBC Tanzania National Business Council FVOCI Fair Value through Other Comprehensive Income TNBRC Tanzania Mortgage Refinance Company Limited This report has been prepared in line with industry best practice and FVPL Fair Value through Profit or Loss TRA Tanzania Revenue Authority accounting frameworks for existing and prospective investors. It is aligned GCF Green Climate Fund TUICO Tanzania Union of Industrial and Commercial Workers to the parameters of the laws and guidelines governing listed companies, GDP Gross Domestic Product TZS Tanzanian Shilling Bank of Tanzania’s (BoT) prudential guidelines, National Board of GM General Manager UN United Nations Accountants and Auditors (NBAA), Dar es Salaam Stock Exchange (DSE) IAS International Accounting Standards USD United States Dollar and Capital Market and Securities Authority (CMSA) guidelines. ICT Information & Communications Technology USSD Unstructured Supplementary Service Data IFC International Finance Corporation The Group’s and Bank’s Annual Financial Statements were prepared in IFM Institute of Finance Management accordance with the International Financial Reporting Standards (IFRS). IFRS International Financial Reporting Standards IMF International Monetary Fund To foster clarity and transparency around our value creation process, INSEAD Institut Européen d’Administration des Affaires some elements of the International Integrated Reporting <IR> Framework ISA International Standards on Auditing were adopted in the preparation of this report. We intend to continuously ISEB Independent Schools Examinations Board evolve future reports to achieve full adherence to the <IR> Framework. JKCI Jakaya Kikwete Cardiac Institute KCBL Kilimanjaro Cooperative Bank Limited Combined Assurance KYC Know Your Customer LDR Loan Deposit Ratio A combined review by management and internal audit was performed LGD Loss given default to ensure the accuracy of our reporting content, with the Board and its LIBOR London Inter-Bank Offered Rate subcommittees providing an oversight role. This report contains certain LTE Long Term Evolution information that has been extracted from the audited consolidated MARC Management Audit and Risk Committee annual financial statements. The Group’s consolidated annual financial MANCOM Management Committee statements were audited by Ernst & Young. MCC Management Credit Committee MD Managing Director MFI Microfinance Institution MFSCL Microfinance Services Company Limited MIM Mobile Information Management 4 2020 CRDB GROUP AND BANK ANNUAL REPORT 2020 CRDB GROUP AND BANK ANNUAL REPORT 5 ABOUT OUR GROUP SHARED VALUE THROUGH THE TIMES SHARED VALUE THROUGH THE TIMES ABOUT OUR GROUP About Our Group 09 How we are organized to serve 14 Our leadership 11 Our perfomance at a glance 17 Our operating environment 18 Our strategy 6 2020 CRDB GROUP AND BANK ANNUAL REPORT 2020 CRDB GROUP AND BANK ANNUAL REPORT 7 ABOUT OUR GROUP SHARED VALUE THROUGH THE TIMES SHARED VALUE THROUGH THE TIMES ABOUT OUR GROUP OUR GROUP HOW WE ARE ORGANIZED TO SERVE Our integrated business model is designed to address the widespread needs covering all market segments by responding to the rapidly changing world. Overview: We are an integrated financial services provider listed at the Dar es Salaam Stock Exchange (DSE). We operate two subsidiaries, CRDB Bank Burundi (S.A) and CRDB Insurance Broker Limited. We are the largest bank in OUR BUSINESS Tanzania with a combined asset base of TZS 7.2 trillion. We have a robust branch network comprising 243 branches inclusive of 20 mobile units and 17,031 banking agents. We offer a comprehensive range of financial services to individuals, Small and Medium-sized Enterprises (SMEs) and corporations. CRDB BANK PLC OUR MISSION To provide competitive and innovative financial solutions through digital transformation, to achieve a distinctive customer experience, while caring for our people and delivering a sustainable contribution to the society OUR PURPOSE To transform lives through OUR VISION financial sector innovation, To be the leading Bank, which is customer needs driven intuitive action and with competitive returns to shareholders. sustainable business. CRDB CRDB BANK INSURANCE BURUNDI BROKER OUR DIFFERENTIATOR SA LIMITED A robust portfolio supported by a resilient balance sheet and great talent. We invest in people, technology and processes to deliver
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