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Development Bank of Zambia Strategic Business Plan: 2013-2015

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STRATEGIC BUSINESS PLAN

2013-2015

November 2013


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FOREWORD

The Development Bank of Zambia (DBZ) commenced 2013 with the preparation of a Strategic Business Plan (SBP) to provide a guide/road map

for the plan period 2013-2015. In the preparation of the SBP, departmental and unit heads participated in two strategic planning workshops; the

first from 25th

to 27th

January 2013 and the second from 4th

to 5th

May 2013 to plan and agree on the outline of the plan. The business plan is

based on the deliberations and consensus reached at these workshops.

The 2013-2015 Strategic Business Plan builds on the accomplishments of 2012. As the Bank is re-capitalised and consolidates its position in

the market, a substantial upturn in activity is expected during the plan period. Developments in the economy and the Banking and Financial

Sector will have a significant impact on the operations of the Bank.

This plan is prefaced on the prudent management and success of the economy. It envisages that there will be stability in Africa and the region

and that Zambia will continue to rank amongst the most attractive investment destinations.

The Government of the Republic of Zambia’s continued support to DBZ will help consolidate the Bank’s position. It is exciting to note that in

common with other countries, the Government of Zambia recognizes the pivotal role that DBZ can play in empowering citizens and in

contributing to the development of the country.

An added advantage arises from the review of assistance programs by Government and major cooperating partners. The old models for

channelling development assistance are changing. Increasingly, development assistance is being channelled through development institutions

with emphasis on the reduction of overheads relating to the delivery of this assistance. DBZ is ideally positioned to take advantage of this

dynamic.

In order to consolidate the impact of the Bank’s operations and enhance its contribution to the development of the country, the Bank will attach

importance to achieving improved project quality at entry. The supervision and monitoring of project operations will also be strengthened in


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order to improve the timely and successful completion of expected output. DBZ intends to increase mobilisation of resources from the market to

finance demand for its products.

Internally, there are a number of issues which the Bank needs to address:

i. The portfolio will continue to grow on the back of increased capitalisation. This growth must take account of the continuing

volatile conditions in the financial markets and the economic stress suffered by borrowers.

ii. The Bank will diversify and expand its product offering, gradually shifting to more term lending and offer

infrastructure/project finance

iii. Attention will be given to continuing the promotion of “self-liquidating” loans to the Small and Medium Enterprise (SME)

sector and financing based more on project cash flows and less on security.

iv. Co-operation with International Financial Institutions, donors and other external actors will form an increasingly important

activity, as the Bank seeks to expand partnerships in order to achieve greater leverage of own resources, improved risk sharing

and the establishment of new sources of finance.

In line with the core objective of developing an institutional culture of transparency, accountability, cooperation and sound corporate

governance, DBZ is committed to developing and implementing the necessary systems and controls. To this end, this Strategic Business Plan

outlines the Bank-wide and the departmental objectives and strategies to be pursued and implemented by each department and unit to achieve

growth and manage risks during the Plan’s implementation period: 2013-2015.

Jacob Lushinga

Managing Director


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1.0 Introduction

The Development Bank of Zambia (DBZ) was established in 1972. It was established under Chapter 363 of the Laws of Zambia. The

shareholding of the Bank is comprised of the Government of the Republic of Zambia and public sector financial institutions, the local private

sector and foreign institutions.

DBZ is committed to meeting shareholder expectations and enjoys strong support from government and other regional and international

development finance institutions. The Bank has earned recognition from government and the development community as a vehicle that can be

used to spearhead and catalyse development.

Despite these achievements, DBZ cannot afford to be complacent in the current plan period which is characterised by risks and global financial

uncertainty. Zambia is highly interconnected to the global economy, with high dependence on foreign investment capital and foreign demand for

her exports. This renders the country and the bank vulnerable during times of global financial and economic uncertainties.

DBZ’s 2013-2015 business plan is designed to both effectively address the challenges facing the Bank and reposition the institution to better

meet its overarching objective of deepening the development impact of its interventions. To this end, this business plan is intended to help the

Bank attain its premier status through greater mobilization of resources and enhancing its capacity to dispense development financing through a

diversified portfolio of short, medium and long term funding instruments.

2.0 Our Mandate

DBZ’s mandate is to support the Government of the Republic of Zambia’s economic development strategies for growth, wealth creation, job

creation, poverty reduction, infrastructure development and improved service delivery.

In the Bank’s quest to fulfil its mandate, DBZ’s main focus is to:


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i. Support investment in both the public and private sector to galvanize growth, productivity, employment, wealth creation and

broad based citizen’s economic empowerment;

ii. Support infrastructure financing to catalyse economic activity and improve service delivery; and

iii. Proactively provide technical support in terms of policy advocacy and advice to Government and other stakeholders.

3.0 Target Sectors

In carrying out its business, the Bank will endeavour to provide capital and other resources for investment in the following main areas which are

consistent with the objective of maintaining a reasonable diversification in its investments among all sectors of the economy:-

Agriculture and agri-processing;

Manufacturing, tourism and hospitality;

Transport, Storage and Communications;

Mining, Construction and Renewable Energy; and

Infrastructure and other economic activities

4.0 Our Mission

The mission of the Bank is to provide competitively priced, tailor-made financial, technical and advisory solutions to viable local enterprises as a

catalyst in economic development.

5.0 Our Vision

To be Zambia’s premier development finance partner


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6.0 Our Values

The values that the staff of the Bank embraces in the execution of their duties reflect the pivotal role the Bank plays in the development of the

country. The values are known by the acronym I-CREDIT, depicting one of the core objectives of the bank which is the provision of medium

and long term credit as a tool for achieving developmental growth.

I-CREDIT stands for:

Integrity: Exhibiting the highest levels of objectivity, accountability, honesty, transparency, fairness and responsibility at all times;

Customer Focus: Placing the customer at the core of the Bank’s business and ensuring high quality of service at all times;

Recognition: Recognizing and rewarding high performance

Effectiveness: Executing mandates effectively, ensuring delivery at least cost and in the shortest time possible;

Diligence: Highest levels of proficiency and due professional rigor;

Innovation: Cutting-edge idealism and adaptability, ensuring the optimum use of information technology and current financial engineering

techniques;

Teamwork: Working in teams to ensure that the objectives of the Bank are achieved in the set timeframes at all times;

7.0 Our Objectives

DBZ’s overall objectives under the new business plan are to:

7.1 Seek rapid growth in business volume and, in that regard, assist in deepening the development impact of DBZ’s interventions.

7.2 Be the market leader in the chosen segments/niches.


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7.3 Broaden and diversify product range.

7.4 Develop customer responsive pricing policies.

7.5 Accept risk and align attitude to risk with the business environment.

7.6 Seek alliances with other banks to enhance clients’ credit propositions and provide term finance which other banks may be unable to

provide.

7.7 To Modernise ICT Infrastructure

These overall objectives are closely supported by departmental commitments as reflected in respective streamlined objectives, coupled by

corresponding matrices of interventions.

8.0 Challenges

In designing the 2013-2015 business plan, and as reaffirmed by the Bank’s internal corporate strategy for the period 2012-2016, DBZ is mindful

and prepared to affirmatively tackle the challenges it faces in its quest to fulfil its mandate.

8.1 National Challenges

8.1.1 High incidence of poverty and unemployment

8.1.2 Unequal access to economic opportunities, including investments

financing, among economic sectors and regions

8.1.3 Low rate and poor distribution of wealth creation, poor service delivery, and

8.1.4 A poorly diversified and integrated industrial export base

8.2 Internal Challenges

8.2.1 Unclear or lack of internal policies and procedures;


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8.2.2 Sluggish credit appraisal and approval system;

8.2.3 Absence of an effective project monitoring system;

8.2.4 Inefficient financial and management reporting systems;

8.2.5 Weak internal control systems;

8.2.6 Poor and ineffective debt collection procedures and processes;

8.2.7 Inadequate skilled staff;

8.2.8 Poor and inadequate ICT infrastructure; and

8.2.9 Poor quality of information.

9.0 Causes of Challenges

DBZ is however mindful of the underlying causes of these challenges that include:

9.1 Poor quality, costly and limited infrastructure

9.2 Inefficient public expenditure management

9.3 Highly capital intensive and urban-based sectors: mining, construction, tertiary sectors, etc

9.4 Limited access to land and other factors of production

9.5 Binding micro-level constraints, including high costs of doing business, poor business management skills and governance practices

9.6 Financial market failure

9.6.1 low access to financial and related business support services

9.6.2 high interest rates and fees

9.6.3 scarcity of term finance

9.6.4 pre-eminence of a conservative commercial bank system


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9.6.5 an ascent non-bank financial system and capital markets.

To enable DBZ achieve its mandate the aforementioned issues need to be addressed within the context of the 2013-2015 Business Plan.

10.0 Interventions

Within the context of the Plan, DBZ will provide the following interventions:

10.1Direct lending (providing short, medium and long term investment capital)

10.2Equity Financing in strategic areas of opportunity

10.3Funds Management (mobilizing and investing third party funds in priority sectors)

10.4Co-financing and syndicated financing arrangements

10.5Apex lending (wholesale lending to financial institutions operating in Zambia)

10.6Provision of technical assistance, business advisory services and capacity building

10.7Fund-based term financing; bridge financing; refinancing; leasing; equity; working capital and trade finance.

10.8Modernisation of ICT infrastructure


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11.0 Departmental Challenges and Strategies

The urgent need for the deepening of the development impact of DBZ’s interventions calls for the Bank to implement the requisite corporate

reforms and to build its financial base. In that regard, the Bank has decided to frontload the departmental interventions and development

strategies as indicated below:

11.1 Human Resources Department

11.1.1.1 Inadequate staffing levels and skilled staff

11.1.1.2 Lack of cohesion and team work

11.1.1.3 Inefficient recruitment and retention procedure

11.1.1.4 HR capabilities in financial and business acumen

11.1.1.5 Lost organisational memory with restructuring and probably turnover

11.1.1.6 Lack of proper systems and process

11.1.2 Objectives Time Lines

11.1.2.1 To attract and retain competent and qualified employees

11.1.2.1.1 Introduce a fair, equitable and competitive remuneration system December 2013

11.1.2.1.2 Develop and implement a retention policy March 2014

11.1.2.1.3 Introduce a private pension scheme for employees September 2013

11.1.2.2 Capability Development


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11.1.2.2.1 Identify business, team and individual learning & development needs March 2014

11.1.2.2.2 Design and facilitate implementation of development programmes to improve On going

leadership and technical skills

11.1.2.2.3 Provide employees with a tool to develop personal development plans December 2013

11.1.2.2.4 Develop and implement learning evaluation to selected programmes February 2014

11.1.2.2.5 Conduct familiarization tours to other developmental finance institutions in the region Ongoing

11.1.2.3 Operational Excellence

11.1.2.3.1 Develop and Implement HR Manuals

11.1.2.3.2 Develop equitable incentives and remuneration system

11.1.2.3.3 Benchmark reward and remuneration with financial institutions in Zambia March 2014

11.1.2.3.4 Introduce a private pension scheme for employees December 2013

11.1.2.3.5 Conduct a job evaluation exercise December 2014

11.1.2.3.6 Conduct HR Policy Sensitizations to staff On going

11.1.2.3.7 Introduce wellness programmes and team building activities

11.1.2.4 Implement Performance Management System 11.1.2.4.1 Train Heads of Departments (HODs) Line Managers and employees on the PMS December 2013

11.1.2.4.2 Facilitate agreements of annual Performance contracts January 2014

11.1.2.4.3 Facilitate attachments with Development Financing Institutions (DFIs) Ongoing


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11.1.2.4.4 Integrate PMS with reward system January 2015

11.2 Corporate Planning

11.2.1 Key challenges

11.2.1.1 Low levels of awareness of the bank and its offering

11.2.1.2 Low brand recognition

11.2.1.3 Absence of comprehensive Corporate Social Responsibility Programme

11.2.1.4 Absence of communications standards

11.2.1.5 Lack of bank-wide unity of purpose


11.2.2.1 To reposition the Bank and re-engineer business processes to enhance service delivery

11.2.2.1.1 Co-ordinate the implementation and monitoring of the Corporate Strategic Plan January

2014/On-going

11.2.2.1.2 Periodic review of the Strategic Plan in order to adapt it to changing circumstances Bi-Annual

11.2.2.1.3 Develop Corporate Communications Manual March 2014

11.2.2.2 Enhance Resource Mobilization

11.2.2.2.1 Development and co-ordination of Resource mobilization strategy in conjunction with Finance

Department March 2014

11.2.2.2.2 Identify sources of income through new products December 2014

11.2.2.2.3 Introduction of fully operational business advisory services in order to create and maintain a


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competitive edge December 2014

11.2.2.2.4 Identify potential sources of affordable finance that will ensure the

Bank’s financial sustainability January 2014/on-

going

11.2.2.2.5 Engage and collaborate with local, regional and international financiers for potential funding

June 2014/On-going

11.2.2.2.6 Develop a prioritized product portfolio in liaison with Projects March 2014

11.2.2.2.7 Publish annual report by June of every year

11.2.2.3 Oversee timely implementation of bank-wide strategic initiatives and projects

11.2.2.3.1 Periodically monitor and record progress in the attainment of departmental

activities as outlined in the strategic plan Quarterly

11.2.2.4 Develop and implement corporate performance management framework in collaboration with all

departments

11.2.2.4.1 Develop Corporate Key Performance Indicators December 2013

11.2.2.5 Promote the Bank’s business and image

11.2.2.5.1 Create awareness of products and services offered by DBZ. June

2013/ongoing

11.2.2.5.2 Develop an integrated marketing and communications strategy to engender loyalty January

2014

11.2.2.5.3 Rebrand the Bank January 2014


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11.2.2.5.4 Create buy-in of strategic plan from all stakeholders January 2014/ongoing

11.2.2.5.5 Participate in local and international shows/exhibitions June 2014/ongoing

11.2.2.6 Develop, implement and monitor a Corporate-wide Marketing Strategy

11.2.2.6.1 Segment the market (develop strategies for each segment): March 2014

i. Government

ii. Capital markets

iii. Donors

iv. Customers

v. Stakeholders

vi. Special interest groups

11.2.2.6.2 Develop and implement product/service marketing plan. May 2014

11.2.2.6.3 Monitor Marketing plan Quarterly

11.2.2.7 Develop a sustainable Corporate Social Responsibility Programme

11.2.2.7.1 Identify initiatives to generate maximum publicity and goodwill, targeting those groups that are

untapped but may have significant impact on development. February 2014

11.2.2.8.2 Develop a CSR policy January 2014

11.2.2.7.2 Implement programme and measure impact. June 2014

11.2.2.7.3 Schedule events to showcase and promote the identified initiatives using

various media channels identified in the Communications Policy. June 2014


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11.2.2.7.4 Participate in various social activities that create visibility of the

Bank to promote its image January

2014/ongoing

11.2.2.8 Enhance skills in Departmental Capacity

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11.2.2.8.1 Develop and implement an annual training schedule in collaboration with HR. Annual

11.3 Information and Communications Technology (ICT) Department


11.3.1.1 Poor and inadequate ICT infrastructure

11.3.1.2 Poor internet connectivity

11.3.1.3 Disparate IT systems, none of which are integrated

11.3.1.4 Lack of an Information Security Management System

11.3.1.5 Non –existent Governance, Risk and Compliance model

11.3.1.6 Inadequate skilled resources

11.3.1.7 Lack of project management skills

11.3.2 Objectives Time lines

11.3.2.1 Develop a comprehensive ICT 2013- 2015 Strategic Plan aligned to the Corporate Plan

11.3.2.1.1 Identify all major IT projects and their estimated budgets January 2014

11.3.2.1.2 Prioritize IT projects in order of justified business case, impact on overall Bank


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effectiveness, market competitiveness and timeliness January 2014

11.3.2.1.3 Identify and recruit IT resources to execute the IT Strategy February 2014

11.3.2.2 Replace information system infrastructure

11.3.2.2.1 Complete core ICT procurement process January 2014

11.3.2.2.2 Prepare building for new network infrastructure February 2014

11.3.2.2.3 Complete installation of new network infrastructure March 2014

11.3.2.2.4 Complete installation of Front End Solution February 2014

11.3.2.2.5 Apply for E1 ISDN (Integrated Services Digital Network) March 2014

11.3.2.2.6 Commence procurement of UCS Telephone System March 2014

11.3.2.2.7 Complete installation of UCS Telephone System August 2014

11.3.2.2.8 Commence procurement of Electronic Security System August 2014

11.3.2.2.9 Complete installation of Electronic Security System December 2014

11.3.2.3 Enhance project portfolio management systems and delivery capabilities of the Bank

11.3.2.3.1 Commence implementation of core banking software to increase efficiency. March 2014

11.3.2.3.2 Appoint Banking and ERP Consultative Forum March 2014

11.3.2.3.3 Complete implementation of ICT system. September 2014

11.3.2.4 Implement ICT governance, risk and compliance (GRC) framework

11.3.2.4.1 Agree on drafted ICT Policies September

2013/Completed

11.3.2.4.2 Implement ICT Policies December 2013

11.3.2.4.3 Appoint GRC Consultative Forum January 2014


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11.3.2.4.4 Introduce and commence implementation of ICT Governance and

Management Best Practice – Cobit 5 February 2014

11.3.2.4.5 Introduce and commence implementation of ICT Service Delivery Management

Best Practice – ITIL (Information Technology Infrastructure Library) February 2014

11.3.2.4.6 Introduce and commence implementation of IS0/IEC 27001 and 27002 Best

Practice on Information Security Management System February 2014

11.3.2.5 Transfer skills transfer and capacity building

11.3.2.5.1 Embark a comprehensive capacity building programme On going

11.3.2.5.2 Commence Core Banking and ERP training July 2014

11.3.2.6 Foster knowledge sharing

11.3.2.6.1 Deploy knowledge management systems: Document Repository and Smart Templates October 2014

11.3.2.7 Introduce online and web-based client services

11.3.2.7.1 Launch rebranded Website January 2014

11.3.2.7.2 Launch online Customer Service Management December 2014

11.4 Projects Department


11.4.1.1 Lack of operational manuals, guidelines and policies

11.4.1.2 Low business volumes

11.4.1.3 Increasing non-performing loans


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11.4.1.4 Inadequate human and financial resources to support increase in lending portfolio

11.4.1.5 Absence of a risk management framework

11.4.1.7 Inadequate staff

11.4.1.7 Lack of policies and guidelines

11.4.1.8 Non-existent monitoring and risk management frameworks


11.4.2.1 Foster Financial Sustainability through better performance of lending portfolio

11.4.2.1.1 Review the appraisal processes and procedures for the range of products

and services offered by DBZ. December 2013

11.4.2.1.2 Develop Frameworks, Systems and Tools for Project Monitoring and Supervision December 2013

11.4.2.1.3 Develop terms and conditions for managing special revolving funds to finance

specific sectors and/or projects December 2013

11.4.2.1.4 Update and introduce Bank Policies, Procedures and Operational Manuals

for Projects Department December 2013

11.4.2.1.5 Increase lending to PFIs from K46,501,367 to K150,000,000 December 2014

11.4.2.1.6 Initiate lending to Local Government for housing requirements as follows:

K100, 000,000 December 2014

K200, 000,000 December 2015

11.4.2.1.7 Increase lending to Microfinance institutions (World Bank Funds) from K12,000,00

to K14, 000,000 December 2015

11.4.2.1.8 Increase lending

a) SME - K105,000,000 December 2014


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b) Medium Corporates - K100,000,000 December 2014

c) Large Corporates - K200,000,000 December 2014

11.4.2.1.9 Start disbursement of GRZ SMEs Fund December 2013

11.4.2.1.10 Utilise CDB SMEs Fund December 2015

11.4.2.1.11 Management of Third Party SME Funds (AfDB and RFP Lines) December 2015

11.4.2.1.12 Establish and utilise Women Special Fund December 2015

11.4.2.2 Diversify income stream

11.4.2.2.1 Establish Fee Income from Project formulation and resource mobilisation to K2,500,000pa December 2014

11.4.2.2.2 Introduce a collateral insurance brokerage of at least 5%-10% of

the premium be paid to DBZ June 2014

11.4.2.2.3 Introduce another managed fund to generate fees of at least 2% or

with interest sharing of at least 1.5-3% December 2014

11.4.2.3 Improve asset quality

11.4.2.3.1 Establish a Projects Monitoring Unit under Project Department October 2013

11.4.2.3.2 Create autonomous Projects Monitoring Department December 2013

11.4.2.3.3 Develop a Projects Portfolio Monitoring Manual December 2013

11.4.2.3.4 Build capacity within the department through staff training and secondment to other DFIs Annual

11.4.2.3.5 Maintain portfolio at risk to under 8% per annum Ongoing

11.4.2.4 Improve governance framework 11.4.2.4.1 Improve Customer Inter-face and response times from current one month to five

working days October 2013 11.4.2.4.2 Out-source Technical Advisory Services for SMEs January 2014 11.4.2.4.3 Up-date/Introduce Bank Policies and Procedure/ Operational Manuals December 2013 11.4.2.4.4 Formulate strategies for: December 2013

i. SME Lending

ii. Wholesale lending

iii. Retail lending to large Corporates


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iv. Technical and advisory services

11.4.2.5 Deepen the development impact of interventions 11.4.2.5.1 Introduce a development impact monitoring framework covering: December 2015

i. Employment creation

ii. Poverty Alleviation

iii. Capacity building

iv. Value addition

v. Increase Access to Credit by type of entity

vi. Promotion of women and youth entrepreneurs

11.4.2.6 Promote Social and Environmental Sustainability

11.4.2.6.1 Develop a social sustainability policy and monitoring framework December 2015 11.4.2.6.2 Develop an environmental sustainability policy and framework December 2015 11.4.2.6.3 Promote citizens’ economic empowerment December 2015 11.4.2.6.4 Promote women participation in the SME sector by allocating 5-10% of SME

funding to women owned and managed enterprises December 2015

11.5 Finance Department


11.5.1.1 Poor quality of information for management in planning, control and decision making

11.5.1.2 Weak internal control environment


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11.5.1.3 Lack of a robust credit administration system


11.5.2.1 Develop an effective service focused-finance unit that supports business strategy

11.5.2.1.1 Deliver timely, insightful financial intelligence that will contribute

to the organization’s competitive advantage. Ongoing

11.5.2.1.2 Identify key performance matrix for periodical reporting to decision makers December 2013

11.5.2.1.3 Build capacity of Finance Staff to equip them with core competences to effectively

deliver services Ongoing

11.5.2.1.4 Review accounting policies and procedures May 2014

11.5.2.2 Contribute to the effective governance of the Bank

11.5.2.2.1 Create a reserve fund as a cushion against losses - 25% of profit after tax December 2013

11.5.2.3 Improve timeliness in the preparation of the financial statements

11.5.2.3.1 Publish annual audited financial statements within 90 days of the year end Within 90 days of year

end

11.5.2.3.2 Present audited financial statements to the Minister of Finance Within 120 days of year

end

11.5.2.3.3 Submit Monthly Prudential returns to Bank of Zambia Monthly/ongoing

11.5.2.4 Improve coordination of budget planning and production, monitor and control budgets

11.5.2.4.1 Deploy business decision support analysis tools, among them long range

and annual operating planning, preparing budgets, analyzing results and

ad hoc analysis Ongoing


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11.5.2.5 Manage cash using robust cash management and treasury systems

11.5.2.5.1 Use ICT platforms to enhance cash balances monitoring Ongoing

11.5.2.5.2 Provide management with daily cash positions Ongoing

11.5.2.6 Evaluate and compute taxes and statutory payments in a timely manner.

11.5.2.6.1 Pay taxes and other statutory obligations by due dates Ongoing

11.5.2.7 Set up a Treasury Unit, an Internal Audit Department and a Risk Department 2014

11.6 Legal Department

11.6.1 Key Challenges

11.6.1.1 Outdated policies and procedures

11.6.1.2 Non-adherence to policies and procedures

11.6.1.3 Weaknesses in the perfection of security for loans

11.6.1.4 Weak regulatory compliance

11.6.1.5 Non adherence to prudential regulations and international best practice

11.6.1.6 Shortcomings in corporate governance


11.6.1.1 Strengthen legal policies and procedures


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11.6.1.1.1 Review existing legal policies December

2014

11.6.1.1.2 Implementing legal policies where necessary e.g. Anti-Money Laundry policies. December

2014

11.6.1.1.3 Develop Legal policies where necessary. December 2015

11.6.1.2 Ensure that security is perfected diligently and on time

11.6.1.2.1 With additional human resource in the department: Conduct searches at Lands

Department to deduce title and at PACRA to establish ownership and directors

of prospective clients December

2014

11.6.1.2.2 Verify properties to be pledged to the Bank as security December 2015

11.6.1.3 Reduce the volume of outsourced legal services by 75%

11.6.1.3.1 Create capacity in Department to maintain the records management system in

the department December

2015

11.6.1.3.2 Reduce cost by negotiating fees in respect of outsourced legal services December

2015

11.6.1.4 Improve corporate governance

11.6.1.4.1 In collaboration with other departments introduce a risk management and

compliance component in the Bank in line with the Bank of Zambia Corporate

Governance Guidelines. December 2015


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11.6.1.4.2 Update shareholders’ agreement December 2015

11.6.1.4.3 Organise induction, training and workshops for Board members December 2014

11.6.1.4.4 Arrange study tours of Projects and other Development Finance Institutions December 2015

11.6.1.4.5 Introduce Directors’ self-performance evaluation June 2014

11.7 Procurement and Administration Department

11.7.1 Key Challenges

11.7.1.1 Limited staff resources

11.7.1.2 Lack of documented policies and procedures


11.7.2.1 To comply with the Act and Regulations

11.7.2.1.1 Develop a Procurement Plan in coordination with all user departments and

submit to ZPPA 31 December 2013

11.7.2.1.2 Re-constitute the Procurement Committee and submit names to ZPPA 30 September 2013

11.7.2.1.3 Publish and update the Procurement Plan on DBZ’s website and government gazette 30 April 2014

11.7.2.1.4 Training of Procurement and Evaluation Committee members

11.7.2.2 To obtain value for money

11.7.2.2.1 Ascertain that the most appropriate procurement method is applied for all purchases

of goods, works an services Ongoing


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11.7.2.2.2 Ensure adequate inspection for all goods , works and services delivered to the Bank Ongoing

11.7.2.2.3 Publish in a timely manner all intended purchases of goods, works and services in the

public media. Ongoing

11.7.2.2.4 Maintain an up to date Register of all DBZ assets and ensure periodic checks on their

status and value. (disscuss with finance) Ongoing

11.7.2.3 To encourage and promote private sector participation

11.7.2.3.1 Encourage active participation of suppliers of goods, works and services in DBZ

Procurement by ensuring timely publication of the Procurement Plan and other Procurement notices 30 April

2014/ongoing

11.7.2.3.2 Ensure that procurement of goods, works and services is timely and conducted in a

transparent and fair manner June 2013/ongoing

11.7.2.4 To improve efficiency of the operations of the department

11.7.2.4.1 Enter into Maintenance and Repair Contracts (MARC) for all works and

services required through the year and/continuously 31 March 2014

11.7.2.4.2 Enter into Purchase Supply Agreements (PSA) for all goods required continuously

throughout the year 31 March 2014

11.7.2.4.3 Introduction of simplified work procedure manuals and administrative forms 30 April 2014

11.7.2.4.4 Develop a stores systems for stock items 30 April 2014

11.7.2.5 To improve fleet availability and management

11.7.2.5.1 Ensure vehicles are only driven by competent drivers/persons authorised to do so Ongoing

11.7.2.5.2 Ensure vehicle service and housekeeping schedules are adhered to Ongoing

11.7.2.5.3 Ensure proper allocation of and efficient use of vehicles Ongoing

11.7.2.6 To ensure maximum use of office space not occupied by the bank


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11.7.2.6.1 Rent out premises/office space not occupied by the bank Ongoing

11.7.2.6.2 Ensure timely collection of rentals and service charges due to the Bank Ongoing

11.7.2.7 To ensure proper maintenance of buildings

11.7.2.7.1 Ensure commencement of refurbishment of both Lusaka and Ndola

Development Houses 30 September 2013

11.7.2.7.2 Ensure that the office buildings are maintained both in terms of infrastructure

and housekeeping Ongoing

Ensure availability of office space and furniture for all members of staff Ongoing

11.8 Research Department

11.8.1 Objectives

11.8.1.1 To create the Department January 2014.

11.9 Internal Audit Department

11.9.1 Objective

11.9.1.1 To create the department December 2014

11.10 Treasury Department

11.10.1Objective


11.11 Risk Department

11.11.1 Objective


11.12 Monitoring and Supervision


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11.12.1 Objective


11.13 Risk and Compliance

11.13.1 Objective


12.0 Monitoring of Implementation of the Strategic Plan

The Corporate Strategy and Marketing Communications Department will be responsible for monitoring the implementation of the Strategic Plan

by each department and by collaborative efforts among departments. Each department will be required to submit the following reports on their

progress in implementation of strategies under the Strategic Plan:

a) Monthly report

b) Quarterly report

c) Annual Report

Each of the reports will contain the following elements:

i. Progress against the Plan

ii. Performance against the budget for each respective strategy

iii. Causes of any delays in the implementation of actions under respective strategies

iv. Actions or resources required to remedy delays stated if any

v. Proposed revisions to the strategies


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The Head of Corporate Strategy and Marketing Communications will spearhead the consultative meetings to be held with all departmental heads

to assess progress in the implementation of the Strategic Plan. These meetings will consider changes in timing, priorities or resources required

for the successful implementation of all departmental strategies.

The Managing Director will present quarterly and annual reports to the Board of Directors on the implementation of the plan.

Successful implementation of each strategy in the Strategic Plan is in the first instance the responsibility of departmental heads. This

responsibility requires that all departmental staff gain familiarity with and ownership of the plan and their respective department’s role in

implementation. In addition, all departmental heads will encourage staff in their respective departments to provide feedback on ways that the

Bank can integrate the Strategic Plan in their day-to-day operations. Departmental heads in liaison with Finance Department must ensure that

actions to be taken in the implementation of the Plan are incorporated into the budget process. All budget proposals should be prepared with

resource allocations that reflect the strategies to be undertaken under the Plan.

12.1 The Corporate Scorecard

DBZ will use the Balanced Scorecard (BSC) as a strategic management tool to direct and manage performance. Four strategic perspectives will

highlight the Bank’s Key Performance Indicators (KPIs). The perspectives will be weighted. The weighting will take into account the operating

environment, available resources and government priority and shall be subject to annual review. Figure 1 shows the Corporate Scorecard of the

Bank.


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Figure 1: DBZ Corporate Scorecard

The Corporate Scorecard will be cascaded to departmental/unit and individual levels and linked to performance contracts to ensure the

achievements of the objectives and targets. The initial scorecard places more weight on the Financial Perspective (40%) to reflect the focus on

ensuring that the Bank positions itself financially to carry out its development financing mandate. This is followed by Organizational Capacity

(20%), Stakeholder Engagement (20%) and Development Impact (20%).

FINANCIAL IMPACT

1. Sustainable Earnings

2. Cost-to-Income Ratio

3. Non-performing Loans as % Gross Debt

4. Net Interest Income as % Interest Bearing Assets

ORGANIZATIONAL CAPACITY

1 Policies

2. Systems & Processes

3. Learning anf Growth

4. Facilities

DEVELOPMENT IMPACT

1. Employment Effects

2. Access to Credit

3 . Environmental & Social sustainability

4. Capacity Building

STAKEHOLDER ENGAGEMENT

1. Staff

2. Customers

3. Community

4. Strategic Partners

5. Board of Directors & Shareholders


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13.0 CONCLUSION

Effective and timely implementation of the 2013-2015 business plan as outlined above will enable the bank to deepen the development impact of

its interventions and thereby meet its mission of stimulating economic activity through the provision of short, medium and long term

capital/funding.

The successful implementation of the planned departmental strategies will play a vital role in supporting the efforts of the Board and

Management to mobilise resources for both the large corporate borrowers as well as the SMEs sector that could, given the right support, play a

major role in uplifting standards of living in the country.

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