ZIMBABWE Stock Exchange listed financial services giant, ZB Financial Holdings Limited, says it is going to rave up its foreign currency generation capacity and swoop on fresh investment opportunities, as part of a broad plan aimed at defending the business against currency depreciation.
The domestic currency was battered during the first half of this year, eroding asset values across markets.
In a statement accompanying the firm’s financial statements for the half year ended June 30 2023, Luxon Zembe, acting chairperson at ZB, said the lender had placed asset preservation among its top priorities.
“The group will continue to develop strategic business partnerships with real sectors of the economy, enhance sustainable revenue streams, especially foreign currency revenues, and take advantage of investment opportunities in order to preserve its capital position against possible loss of value from currency depreciation,” Zembe said.
“In the short term, prudent investment and cost containment measures will continue to be a priority in order to boost profitability.
“In the medium to long term, the group continues with its digitalisation journey with more focus on implementing robust and state of the art core banking and life assurance systems in order to enhance efficient products offerings that provide value and convenience to our customers,” he noted.
Shepherd Fungura, chief executive officer at the firm, said ZB’s income performance was boosted by a 3 022% rise in fair value adjustments during the review period.
“Net interest income rose by 115%, from ZW$20,143 billion in 2022 to ZW$43, 406 billion in 2023. Loan impairment charges fell by 1%, from ZW$11,232 billion in 2022 to ZW$11, 132 billion in 2023,” he said.
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“Resultantly, net income from lending activities improved by 262%, from ZW$8,910 billion in 2022 to ZW$32, 274 billion in 2023.”
The banking group’s profit after tax increased to ZW$678,45 billion during the review period, compared to ZW$29,77 billion during year ended December 31, 2022.
The value of ZB’s total assets also increased, according to the financial statements.
An increase of nearly 299% in mortgages and other advances to ZW$807,57 billion at the end of the review period, from a December 2022 figure of ZW$202,63 billion, drove total asset values, the financial statements showed.
It is a trend that has also been reported at other financial institutions during the review period.
“The group maintained a comfortable liquidity margin of safety, with the ratio of liquid assets to customer deposits being above 55% throughout the year against a prescribed ratio of 30%,” Fungura said.
“During the half year to 30 June 2023, the group entered into a Memorandum of Agreement with the Women Owned Business Trust (WOBT), a trust whose primary purpose is advancing women owned businesses through capacity building and providing access to markets.
“Under the agreement, ZBFH is listed as one of the WOBT supplier diversity inclusion partners with the target of ensuring that qualifying WOBT members are on-boarded as part of the group’s suppliers’ listing,” he added.
The Zimbabwe dollar traded at US$1:ZW$5 739,79 on June 30 2023 and US$1:ZW$370,96 on June 30 2022.
