Established as New Building Society in 1964, NBS was converted to a full service commercial bank in July 2004. Owned 60% by NICO Holdings Limited, NBS is the fourth largest commercial bank in Malawi, with about 12% market share in total assets. The Bank had total assets of $195 million as at December 31, 2009. Current shareholding structure is as follows; NICO Holdings Limited 60% National Investment Trust Limited 8.1% Public (listed) 28.7% Employee Share Ownership Trust 3.2%

Total Project cost will be up to $10,000,000. IFC will invest in the ordinary shares of NBS Bank Limited. The shares are listed on the Malawi Stock Exchange. IFC’s total shareholding for the proposed transaction will be for a holding of up to 20% of the ordinary shares of the Bank.

NBS Bank Limited’s head office is located in Blantyre, but is operates from 13 branches and 14 agencies located throughout Malawi.

(i) Growth of SMEs in Malawi through increased access to financial services; (ii) Growth of the Bank as the investment will allow further leveraging; and (iii) Demonstration effect, allowing further investment by other players into the Malawian SME segment.

(i) Promotion of the development of the Malawian SME sector through the provision of long-term risk capital that would enable the Bank to extend long term financing to Malawian SMEs; and (ii) IFC investment will serve as an endorsement of NBS in particular and the Malawian Banking sector in general, encouraging additional investment into the sector by other funders. (iii) There is a possibility that IFC will implement an Agri-finance Advisory Program with NBS to enhance the Bank's capacity to provide Agri-finance to this under-served market in Malawi.

This project has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure. During appraisal, IFC will analyze the FI portfolio for types of transactions, size, tenor and industry sectors and based on an analysis of the potential Social and Environmental risks associated with the FI portfolio and considering IFC’s investment, determine the Applicable Performance Requirements. These will likely include the IFC Exclusion List, the National Social and Environmental Laws and regulations and the IFC Performance Standards. IFC will also review the FI’s labor practices according to the IFC’s Performance Standards 2: Labor and Working Conditions. Based on the Applicable Performance Requirements, the review of the Bank’s existing SEMS and capacity to implement the same, the project will be required to: (i) Upgrade and enhance the existing Social & Environmental Management System (SEMS), prior to investment, to the satisfaction of IFC, (ii) Continue to retain responsible, qualified persons to manage and implement the SEMS, (iii) Commit to implement the SEMS, to ensure that its activities are in compliance with the Applicable Performance Requirements, (iv) Submit a periodic report to IFC as per a format to be provided by IFC, and (v) Demonstrate commitment to applying the labor standards established by the IFC Performance Standard 2: Labor and Working Conditions.