Tanzania’s Banking Sector Surpasses Sh2 Trillion in Profits.

Friday, 31st January 2025

Dar es Salaam – Tanzania’s banking sector has entered uncharted territory, with total net profits surpassing Sh2 trillion for the first time. The growth reflects a combination of regulatory stability, digital banking adoption, and shifting economic dynamics, setting a new benchmark for the industry.

With 33 commercial banks operating in the country, a handful of first-tier institutions continue to shape the financial landscape. CRDB Bank Plc and NMB Bank remain dominant in terms of total assets, while NBC, Exim Bank, and Stanbic Bank have maintained steady growth. Others, including PBZ, Azania Bank, and Standard Chartered Bank, have also reinforced their positions in an increasingly competitive environment.

The sector’s profitability has been on an upward trajectory, with net profits climbing from Sh1.57 trillion in 2023 to Sh2.14 trillion in 2024, based on unaudited financial statements from 22 banks. The biggest driver of this surge has been higher lending volumes, coupled with a rise in transaction-based revenue streams. NMB Bank led the industry, recording Sh643.8 billion in net earnings, while CRDB Bank followed closely, reporting Sh550.8 billion. The two banks have built on their ability to expand loan books while managing risks effectively, reflecting broader economic stability and improved business sentiment.

Profitability gains were not limited to the largest institutions. Stanbic Bank, NBC, and Standard Chartered Bank all saw significant increases in net earnings, while Exim Bank and PBZ posted some of their strongest numbers to date. The turnaround at Tanzania Commercial Bank (TCB), which rebounded from a loss in 2023 to profitability in 2024, underscores the shifting fortunes within the sector. Equity Bank also posted a sharp rise in profits, reflecting the increasing role of regional banking networks in Tanzania’s financial market.

The performance of the sector has been shaped by several factors, with regulatory reforms and an evolving digital landscape playing a central role. Lending practices have become more refined, allowing banks to better balance risk while expanding their loan portfolios. Meanwhile, the shift toward mobile banking, digital transactions, and alternative financial services has widened access to banking solutions, reducing dependency on physical branches.

For banks that have navigated these shifts successfully, operational efficiency has become as important as revenue growth. At NMB Bank, executives have pointed to a combination of cost controls, risk management, and digital expansion as key factors behind its continued profitability. The bank also reported an improvement in credit quality, with its non-performing loan (NPL) ratio dropping below 3 percent, signaling stronger borrower performance.

CRDB Bank has taken a broader regional approach, with expansion beyond Tanzania’s borders playing a growing role in its strategy. The bank has been focusing on SME financing, agricultural lending, and digital payments, areas that have shown consistent growth. Executives at the bank have stressed that access to finance for small businesses and informal sector players remains a major priority, reflecting a shift in how banks position themselves in a market where financial inclusion is increasingly tied to long-term sustainability.

The broader banking sector has also benefited from a regulatory environment that has prioritized stability while allowing room for digital disruption. The Bank of Tanzania’s oversight of credit risks and liquidity ratios has helped maintain market confidence, ensuring that banks are well-capitalized to weather potential shocks. Meanwhile, banking regulations have adapted to technological changes, creating room for fintech partnerships and mobile-based financial services to flourish.

Looking ahead, the sector remains at an inflection point. While profitability has soared, questions remain about how banks will sustain this momentum. The impact of global economic trends, shifting interest rates, and potential credit risks in key sectors will likely shape banking strategies over the next few years. At the same time, the competition in digital finance, cross-border banking, and alternative lending models is growing, pushing traditional banks to adapt faster to changing customer behaviors.

As Tanzania’s financial system continues to evolve, the challenge for banks is no longer just about profitability—it is about relevance. The institutions that will thrive are those that strike the right balance between risk and innovation, leverage technology effectively, and deepen their role in the broader economy. With the banking sector now crossing the Sh2 trillion profit threshold, the next phase will be defined by how well these gains translate into long-term economic impact.