PRESS RELEASE

President Guebuza inaugurates Banco Terra

Mozambican President Armando Guebuza on Wednesday formally inaugurated the country’s newest
commercial bank, Banco Terra (Land Bank), the first Mozambican bank that will focus specifically on
agriculture and the countryside.

The bank is the brainchild of the Mozambican investment company, GAPI, which negotiated for three
years with foreign partners to set up Banco Terra. GAPI holds 29.3 per cent of the shares of the bank,
and the private Dutch bank Rabobank, which also specializes in agricultural financing, holds 30.7 per
cent. The remaining 40 per cent is divided equally between the German and Norwegian development
finance bodies, KFW and Norfund.

The initial capital for Banco Terra is 185 million meticais (about 7.7 million US dollars), Antonio Souto,
GAPI chairperson and deputy chair of the new bank, told reporters that he expects an increase of
around 50 per cent in the Banco Terra capital in the near future.

The equivalent of 16 million dollars will be spent over three years to ensure that the bank operates out
of 20 branches, mostly located along strategic corridors for agricultural marketing.

Banco Terra has started with its headquarters in Maputo and a branch in the northern city of Nampula.
By the end of 2008 it will have branches in the fertile agricultural districts of Malema, west of Nampula,
and Angonia in Tete province, as well as in Tete and Beira cities.

Guebuza declared that the launch of Banco Terra “is an important landmark in dynamising our already
vibrant financial system. Its birth gives substance to our promises to provide an increasing space for
private commercial banking in social and economic development”.

He recalled that the government’s plans to make the 128 rural districts “poles of development” involve
decentralising human and financial resources. He was convinced that there are sustainable business
opportunities in the districts, and hence the possibility of savings – but this could only become efficient
if banks set up branches in the districts.

“The government’s expectation is that the Green Revolution and the programmes of decentralization and
rehabilitation of infrastructures, which result in the increased availability and circulation of money in the
districts, will make it attractive for banks to operate here”, said Guebuza.

The government’s attempts to persuade banks to operate in the districts was having some effect, the
President believed, In early 2007, the number of districts with bank branches was just 28. As of July
2008, it had risen to 39 – but that still leaves 89 districts without a single bank between them.

Guebuza pointed out that, without banks or other savings institutions, peasant farmers are obliged to
keep their money in unsafe conditions, hiding it in mattresses or burying it in the yard.

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Not only was money kept in this way vulnerable to fire or other disasters, but it was completely
unproductive. “We want savings that enter the economic circuit, through reinvestment in productive
sectors, thus multiplying available resources and accelerating investment”, stressed Guebuza. “Increased
production and productivity and the availability of greater credit opportunities for small and medium
companies depends to a large extent on attracting these savings”.

“We want to see a growing number of banks going out to the rural areas to attract these savings and put
them into the productive sector”, the President urged. “All the evidence shows that these savings exist
and are waiting for our financial operators”.

Souto told the ceremony that GAPI had worked to establish Banco Terra, “so that Mozambique can have
a more modern and inclusive financial system”.

“As in all serious negotiations, there were difficult moments before we reached agreement”, said Souto.
The determining factor had been “our ability to show that resources channeled through GAPI had made
loans available to dozens of small companies, creating thousands of jobs”.

Banco Terra Chairman Arnold Kuijpers stressed that, while the new bank intends to be a rural bank, “it
will not just deal with agriculture. That would not be viable”. Financing agriculture alone would involve
unacceptable risks, and an insufficient number of transactions. “You need a lot of transactions to service
clients at a low cost”, said Kuijpers. His view of a rural bank was “a bank that serves all market segments,
but prioritises the market segments in rural areas and farming”.

He stressed the opportunities for investment in Mozambican agriculture, since currently only 13 per
cent of the country’s 36 million hectares of arable land is being used. “Mozambique is in a position to
develop its agriculture and to export food”, Kuijpers said. “Banco Terra will facilitate this”.

Source: AIM , September 10th, 2008

FOR ADDITIONAL INFORMATION CONTACT:

Maarten Susan: Mobile: +258 82 303 0704 or +258 21 359 901, Email: msusan@bancoterra.co.mz
Rien van Eck: Mobile: +258 82 304 0168 or +258 21 359 900, Email: reck@bancoterra.co.mz

www.bancoterra.co.mz

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