Harare – Nedbank Zimbabwe has reported an 82 percent jump in profit after tax for the year ended 31 December 2018 largely driven by a growth in non-interest income.
The Bank made US$14.34 million profit in the period under review, up from US$7.89 million in the same period a year earlier.
Driving the growth in profit was a 42 percent increase in non-interest income to US$25.3 million from US$17.9 million recorded in the prior year.
“The increase in non-interest income was mainly as a result of a significantly higher volume of transactions on the digital banking platforms,” Nedbank’s Managing Director Charity Jinya said in a statement accompanying the financial results.
Net interest income increased by 34 percent from prior year position of US$16.576 million to US$22.502 million with the contribution from investment in RBZ Savings bonds being the biggest driver for this revenue line.
Total operating expenses increased by 21 percent to $28.8 million during the review period from $23.7 million in the prior year largely driven by once off staff costs stemming from inflationary pressures.
Total assets grew by 17 percent from US$369.529 million to US$432.649 mainly as a result of the treasury investments.
Net loans and advances to clients constituted 26 percent of the total assets compared to 27 percent in 2017 while cash and cash equivalents decreased to 19 percent from 46 percent in 2017.
“Total deposits also registered a growth of 16% to US$343.798 million in line with the Bank’s strategic deposit mobilisation initiatives to support targeted asset growth,” Jinya said.
Over the period, the Bank also intensified its digital banking expansion drive to satisfy changing client needs and demands in different segments.
During the year, Point of Sale (POS) machines were increased by 1 176 contributing to a 511 percent increase in revenue generated from the digital banking platform to US$8.3 million from US$1.4 million in 2017.
The Bank’s core capital stood at US$68.95 million representing an increase of 22 percent from US$56.32 million as of December 2017 which place the bank on course to meeting the minimum core capital requirements of $100 million within the stipulated time frame.
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Raynold Mhotseka is a Journalism and Media Studies student at the University of Zimbabwe. He serves as a news writer at financial research firm, Equity Axis where he is currently on attachment.