Tanzania - The Dar es Salaam Stock Exchange (DSE) has said that there are no plans at the moment to delist the National Investment Company Limited (NICOL) after its board of directors was suspended last month over poor business performance. "We are presently comfortable that nearly 90 per cent of NICOL assets are invested at the National Microfinance Bank (NMB) which is doing well at the stock market," said DSE Chief Executive Officer, Mr Gabriel Kitua in an interview with the 'Daily News' in Dar es Salaam on Tuesday. However, he cautioned that any decision to delist NICOL would be taken if a report by the Capital Markets and Securities Authority (CMSA) reveal any fraudulent transaction. On his part, the CMSA Principal Public Relations Officer, Mr Charles Shirima said there are ongoing investigations over NICOL poor performances which have seen it failing to issue dividends since 2007.

"The investigations would propose action to be taken against NICOL," Mr Shirima said. NICOL challenged the CMSA suspension seeking orders of the High Court against the decision.

However, the High Court ordered that the "status quo" should be maintained by upholding the suspension until the matter is finally determined. In the meantime, the CMSA and the Attorney General filed preliminary objections and the hearing is scheduled for April 14, 2011.

Early this year, CMSA notified NICOL shareholders over the unsatisfactory performance of some of the company's asset portfolio for failure to invest as per the laid down principles.

According to the CMSA statement to NICOL shareholders, the company failed to conduct an in-depth feasibility and due diligence as well as involving Independent Investment Committee and Fund Manager before committing funds in the projects.

The statement stressed further that failure to adhere to acceptable investment principles resulted into some of the NICOL funds being directed to companies whose performance is questionable.

This led to NICOL suffering huge losses and thereby denying its shareholders the opportunity to receive dividend payments. The company has incurred a total loss amounting to over 10bn/-.

Sebastian Mrindoko

Tanzania Daily News/13/04/2011