State-owned National Banking Corporation (NBC) secured a commercial banking licence in December 2024. In this exclusive interview, Chairman Darrell Seeto shares his plans to get the bank to profitability and a listing on Papua New Guinea’s stock exchange.

The NBC was officially launched as a commercial bank on 11 April 2025. Pictured (from left): newly appointed NBC CEO Paul Thornton, Vice Minister State Enterprises, Hon Raphael Tonpi MP, Deputy Prime Minister Hon. John Rosso MP, Minister for State Enterprises, Hon. William Duma MP, NBC Chairman Darrell Seeto, and Managing Director of Kumul Consolidated Holdings, Prof. David Kavanamur. Credit: NBC

BAPNG: What is your growth plan for the first 12 months as a bank?

Darrell Seeto (DS): We’re focused on getting the bank to profitability on the basis that we are looking to take it to an IPO [initial public offering] by the end of 2026.

The Prime Minister James Marape and Minister [for State Enterprises] William Duma gave us a mandate to bank the unbankable.

“We have a government mandate to offer shares to all Papua New Guinean citizens so that they can have a sense of ownership in their own assets in their own country.”

A lot of the population of Papua New Guinea is difficult for banks to reach because of the terrain and safety. A lot of banks won’t deal with them because of the difficulties in meeting compliance requirements. At NBC we are committed to expanding financial inclusion through secure digital platforms, while making sure customers meet all the necessary identification and regulatory standards.

We are looking at opening about 10 branches across PNG.  In terms of product development, we will be looking at SME [small and medium enterprise] loans, visa cards, foreign exchange, etc. We are also looking at the corporate banking side. We’d be looking at banking a lot of the state-owned enterprises and government institutions.

BAPNG: How will the IPO work?

We have a government mandate to offer shares to all Papua New Guinean citizens so that they can have a sense of ownership in their own assets in their own country.

Right now, the [state-owned] National Development Bank owns 60 per cent of this bank and KCH [state-owned Kumul Consolidated Holdings] owns the remaining 40 per cent.

A condition set by the Bank of PNG is that the 100 per cent state ownership needs to be diluted down to less than 20 per cent by IPO.

We’re looking to dilute up to 50 per cent of our equity to private investors in PNG in 2025. I call it the seed round. I’d be looking to raise anywhere between K150 million to K200 million in the first six to nine months of this year.

By the time of the IPO, we’re looking to bring the government’s stake down to as little as 19.9 per cent. We’ll look at the ownership changing to become more retail-based and to have super funds investing in us, so that we truly become a PNG publicly listed and owned bank.

The feedback from the public so far has been nothing short of positive. They actually have ownership in the business and that’s one of the things driving myself, my board and my management team.

BAPNG: From the sounds of it, servicing SOEs and government institutions will help differentiate you from the two other new banks that received licences last year?

DS: It’s accurate to say that, but right now, from a practical point of view, we need to build our own profile.

We’re focused on financial independence and I am confident in raising private capital to drive our growth – and I’m happy to raise that money with government support.

Some of these government entities have a lot of foreign exchange. If we can get some of that, the doors will open for other corporations and small-to-medium-sized enterprises to give us business.

BAPNG: Which other markets are you targeting?

We’re also targeting the market held by payday lenders, who are charging public servants 100 per cent interest to lend them money for one or two weeks.

Charging people 100 per cent interest is not right. It’s ethically and morally wrong.

I intend to do it at unsecured rates around 27 to 30 per cent, subject to the risk. Even if we are lending the money out between 30 and 35 per cent, we will be lowering the cost of borrowing for the consumer by 65 per cent.

BAPNG: Where do you see National Banking Corporation and the banking sector in the next few years?

DS: With a three-to-five year view, we will be standing on our own two feet, independently and with a public listing. We will have our own board. We will be profitable. And above all, we’ll be servicing the people of PNG, offering them a better level of service, better products and a better experience.

All in all, I’d like to make sure that our bank is growing, and we can compete with the big boys. Who knows what will happen maybe three or four years down the track. [Perhaps] we could buy one of them out or merge. It would be a dream to make that happen.