Barclays Bank (Tanzania) Limited has posted a net loss of 6.29bn/- in the second quarter of this year, months after closing dozens of its branches and laid down workers in what it called “restructuring”. The bank in the similar quarter last year made a net profit of 1.63bn/-.

According to the bank’s financial statement released, the losses are attributed to the amount set aside for impairment losses on loans and advances of 2.34bn/- in the said quarter.

The impairment and non-interest expenses amount reduces Barclays’ net interest and non income earning of 5.42bn/- and 6.0bn/- respectively.

This also affected the bank’s earning per share after dropping to negative 118/- against 31/-. The non-interest expenses climbed up from 11.63bn/- of last year’s second quarter to 15.37bn/- in this year, mainly pushed by other operating expenses that consumed 8.51bn/- in just three months.

In May, Bacrlays was forced to close 10 branches and retrenched 100 workers countrywide in a move the bank termed as “restructuring” but analysts said was due to stiff competition and poor expansion plans. Barclays Tanzania Managing Director Mr Kihara Maina said then that closing and merging the branches decision would enable the bank to invest more effectively in other opportunities.

“This is part of the organization’s strategy to realign their geographical presence in the country,” the Barclays MD said in a release.

Commenting on the restructuring process, Bank of Tanzania’s Director of Banking Supervision, Mr Agapiti Kobelo, said that the bank balance sheet is sound, healthier and there is nothing to worry it “is merely restructuring”.

The Director said the statement to close branches was basically on the restructuring side after a cost benefit analysis which shows that the expansion, which was done at a go at late 2000s, was not paying. Up to the end of first half of  this year, Barclays total assets grew slightly less to 513.27bn/- from 570.33bn/- while its customer deposits also slid to 402.08bn/- from 471.29bn/- of similar half of last year.

Last year, Serengeti Advisers’ banking survey shows that Barclays is the fourth biggest bank in the country, with a workforce of 668, in term of employment controlling 6 per cent of total bank’s staff of 11,208 at the end of 2010. But the number of workers has dropped in the second quarter to 586.

By ABDUEL ELINAZA, Tanzania Daily News