FBC Holdings Limited says it will implement strategies that proactively create shareholder value and maximise returns considering the country’s economic turmoil.
Zimbabwe’s economic crisis is characterised by increased volatility of the Zimbabwe Gold (ZiG) currency, which was introduced in April to replace the RTGS.
The ZiG recorded its first major depreciation in September and continues to remain volatile against the greenback.
The devaluation came after the economy saw an injection of liquidity into the market by the authorities, a move which is expected to recur owing to end of year bonuses.
In its trading update for the period ended September 30, 2024, FBC said the third quarter presented a semblance of exchange rate volatility and inflationary complications.
FBC added that this triggered a devaluation of the ZiG and price distortions in the formal markets.
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“Whilst the operating environment is still faced with macro-economic challenges, the group remains guardedly optimistic about the future.
“Our robust business model, experienced management team and diversified portfolio, provide a strong foundation for navigating these complexities,” FBC said.
“We are confident in our ability to adapt to the evolving economic landscape and to continue delivering sustainable long-term growth.
“The group continues to monitor economic developments and will implement strategies that proactively create shareholder value and maximise returns.”
FBC said its diversified business model, cutting across various financial service clusters, continued to act as a cushion against market fluctuations and systematic downside risks.
“Additionally, our long-standing client relationships provide stability and capacity in navigating economic turbulence.
“Notwithstanding economic uncertainty, operational overhead management remains a key strategic pillar in achieving profitability,” FBC added.
During the trading period under review, these strategies saw FBC post a profit after tax to ZiG1,9 billion, driven by robust net foreign currency dealing and trading income.
In the comparative 2023 period, FBC achieved profit after tax of ZWL318 billion, which is equivalent to ZiG127,2 million according to the official exchange rate of ZiG1:ZWL2 500.
“As of 30 September 2024, FBC Holdings Limited reported a strong financial performance, generating a total income of ZiG4,9 billion.
“This growth was primarily driven by robust net foreign currency dealing and trading income,” FBC said.
“The group maintained a disciplined approach to cost management, with operating expenses totalling ZiG1,97 billion. This resulted in an impressive cost-to-income ratio of 40%, reflecting the group’s commitment to operational efficiency in a dynamic and indeterminate economic environment.”
As of September 30, 2024, FBC’s total assets were ZiG17,3 billion and shareholder funds were ZiG3,9 billion.
“Monetary policy interventions anchoring exchange rate volatility and inflationary pressures continue to be encouraging, in view of creating an enabling operating environment,” FBC said.
“Whilst challenges still exist, the group remains resilient by capitalising on inherent opportunities and positioning the business for future growth.”