ZB registers robust growth

HARARE - ZB Financial Holdings (ZB) recorded a 12 percent increase in total income to $38,6 million in the half year ended June 30, 2018 driven by an expansion in net income from lending activities.

The group reported a 15 percent profit increase to $9,35 million compared to $8,17 million recorded in prior period.

Ron Mutandagayi, the ZB chief executive,  told analysts that the increase was primarily driven by an expansion in net income from lending activities which increased by 39 percent as well as an increase in other operating income which went up 14 percent.

“Despite a one percent reduction in interest income from $13,3 million to $13,2 million, net interest income increased by 12 percent from $9,1 million to $10,2 million as interest paying liabilities re-priced faster than assets in an environment in which rates fell down,” he said.

The net income from lending activities, at $10,9 million in 2018 compared to $7,9 million in 2017, is enhanced by a net recovery from non-performing loans of 700 000, against a charge of $1,3 million in the corresponding period in 2017.

“The 14 percent increase in other income from $20,1 million for the half year ended 30 June, 2017 to $22,9 million for the half year ended 30 June, 2018 was largely driven by a 14 percent increase in banking customers as well as a general increase in the number of transactions particularly through the electronic banking channels. Earnings from traditional channels have been sliding down,” Mutandagayi said.

The group’s operating profit increased by 11 percent to $10,5 million for the half year ended 30 June, 2018 compared to $9,4 million reported in prior period.

After provision for tax expenses, the net profit for the group amounted to $9,4 million for the period compared to $8,2 million in 2017.

Total assets for the group went up 10 percent from $527,1 million as at 31 December, 2017 to $579,8 million as at June 30, 2018.

Non-performing loans constituted 10,1 percent of the gross loans as at June 30, 2018 , an improvement from 10,7 percent reported at December 31, 2017.

Earning assets were maintained at 77 percent between December 31, 2017 and June 30, 2018.

Deposits and related accounts increased by 13 percent from $347,1 million at December 31, 2017 to $391,5 million at June 30, 2018.

Net revenues from the group’s insurance activities remained flat at $4,9 million, with gross premiums having increased by six percent from $15,5 million for the half year ended June 30, 2017 to $16,5 million in prior comparable period.

“The increase in gross premiums was largely influenced by increased business outturn from the life assurance operations at 18 percent whilst the reinsurance premiums remained flat against the backdrop of reducing external business as foreign exchange risk became more amplified,” he said. – The Financial Gazette

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