FIRST Capital Bank Limited’s (FCB) total deposits increased 12,5% to ZiG1,9 billion (US$137,1 million) in the half year ended June 30, 2024, owing to a rebound in balances during the second quarter.
The increase was from a comparative of ZiG1,7 billion (US$123,1 million) reported as at December 31, 2023.
In a statement accompanying financial results for the half year ended June 30, 2024, FCB chief executive officer Tapera Mushoriwa said the increase was against an unstable currency framework which experienced relief after monetary interventions.
He said foreign currency deposits contributed 83% of the total deposits, down from 87% at December 31, 2023, reflecting early signals of the resurgence of local currency activity on the market.
“The bank’s total deposits closed at ZWG1,9 billion (US$137,1 million) as at June 30, 2024, 12,5% higher than ZWG1,7 billion (US$123,1 million) reported on December 31, 2023,” Mushoriwa said.
“This trend reflects a rebound after balances had marginally come off in the first quarter against the backdrop of an unstable currency framework which experienced relief after the monetary interventions announced by the central bank at the beginning of the second quarter.”
As deposits rose, loans to customers grew by 11,2% to ZiG1,3 billion (US$94,7 million) from ZiG1,2 billion (US$86,1 million) as at the end of 2023.
The bank reported that the loan quality remained satisfactory, with the non-performing loans ratio having improved to 3% from 8%, over the six-month period.
Mushoriwa said a loan loss ratio of 1,4 was recorded.
“The bank posted a profit after tax of ZiG155,5 million (US$11,5 million) for the six months to June 2024, which was 168% higher than ZiG58 million (US$4,3 million) recorded for the comparative period in 2023,” he said.
“Total income grew by 12,8% from ZiG435,9 million (US$32,1 million) to ZiG491,6 million (US$36,4 million). This growth was driven by an improvement in the underlying business, with net interest income and non-interest income increasing by 23,3% and 6,8% respectively.”
Operating expenses for the half year decreased to ZiG271,4 million (US$20,1 million) from ZiG275 million (US$20,3 million), reflecting general cost stickiness in an environment that is in the early stages of transition.
FCB is working on an exhaustive cost rationalisation programme and expects further savings during the second half of 2024.
“The total comprehensive income for the period under review at ZiG169,1 million [US$11,6 million] was 658,8% more than a total comprehensive loss of ZiG25,7 million [US$2,4 million loss] recorded for the 2023 comparative period,” Mushoriwa said.
Total assets were ZiG3,51 billion as of June 30, 2024, up nearly 10% from the end of last year owing FCB’s increase in loans and advances.
“The bank’s capital was always maintained above the regulatory minimum of US$30 million whilst closing the period at US$59,2 million,” FCB chairperson Patrick Devenish said.
“The capital adequacy ratio closed at 31%, representing capacity to underwrite more business. Similarly, the liquidity ratio was maintained above the regulatory threshold of 30%, creating capacity for the Bank to manage market shocks.”
In early 2024, FCB secured an additional US$20 million line of credit from the African Export-Import Bank to support foreign currency generating businesses, with a focus on small to medium enterprises and midcap companies in Zimbabwe.
The African Development Bank approved a combined US$15 million “trade finance package”, comprising a US$7,5 million trade finance transaction guarantee and a US$7,5 million trade finance line of credit.
