Akiba Commercial Bank

Akiba Commercial Bank, Tanzania

Akiba Commercial Bank was founded in 1993. In 1997, Akiba received its operating license and formally launched operations.

Accion first partnered with Akiba in early 2002, with the initial launch of an institutional assessment exercise. Over the course of the next few years, Accion provided technical assistance services for Akiba’s operations, largely in the areas of training, product design and marketing.

In 2008, Accion Investments in Microfinance, SPC (AINV), a fund sponsored and managed by Accion, invested just over US$2m in Akiba to strengthen the equity base of the bank and provide capital for growth. Around the same time, Akiba and Accion entered into a management agreement whereby Accion seconded key management positions.

In 2012, as part of a reorganization, AINV transferred its 20% ownership in Akiba to Accion. The bank saw steady growth in gross portfolio and profitability under Accion’s management contract, reaching a gross portfolio of TZS 80 billion and pre-tax profitability of TZS5.3 billion at the end of 2014. In this period the bank also expanded outreach from 6 branches to 16 branches.

On April 1, 2015, the board of Akiba selected a new Managing Director of Akiba and Accion’s management contract came to an end as of May 31, 2015. The bank continued its growth trajectory in 2015 and 2016, reaching TZS149 billion in gross portfolio and 12.3 billion in pre-tax net income at the end of 2016. However, during 2017, due to deteriorating loan quality in the portfolio the bank saw a reduction in gross loan portfolio and posted a pre-tax loss.

In 2018, the board of Akiba engaged the German firm, Inspiring Development, to deploy a new Managing Director and a General Manager of Risk. Under the new management, the loan portfolio has been stabilized and its quality has improved.

Other shareholders in Akiba include FMO, Erncon, Triodos, Parastatal Pension Fund, Incofin, Interconsult, FEFISOL, and other private individuals.

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