Banks and Banking 2019 Survey: Ecobank awarded top accolade

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Harare – Pan African Bank, Ecobank Zimbabwe was awarded the best bank in Zimbabwe at the recently held Banks and Banking 2019 Survey Awards.

The program, running under the theme “Return of the Zim-Dollar Transition to Nolmacy?” was presented by The Zimbabwe Independent which is owned by Alpha Media Holdings in partnership with First Capital Bank as the main sponsor for the second year running.

In receiving the accolade, Ecobank’s Head of Customer Relations, Lawrence Kupika reflected on the strides the Bank has made while thanking customers in the process.

“I want to thank organisers of this event AMH, our sponsors and partners in the industry and our customers,” Mr Kupika said.

“It’s not been an easy walk, we’re a small Bank but we bite!”

The Banks awards come at a time where the banking industry, just like many other sectors in the country are facing viability challenges due to a crippling operating environment characterised with among others, cash and foreign currency shortages, low productivity, currency instability, high inflation, confidence deficit and speculative behaviours.

Confidence in the banking sector has been due to unpredictable policy changes in regards to currency functionality and limited access to cash in the process discouraging bank deposits while queues at banks have been existence for quite too long.

Despite all the headwinds, organisers of the event have found it significant to honour the Banks for the strides they are making, a move which also compliments the drive towards financial inclusion.

Local Financial Research Firm, Equity Axis was tasked with the process of overseeing the adjudication of the data used to come up with choosing the winners in the various categories as shown below.

Ecobank Zimbabwe Limited

Ecobank Zimbabwe, a subsidiary of Togo-based Ecobank is one of the commercial banks licensed by the Reserve Bank of Zimbabwe. The Bank’s services include personal banking, business banking, global banking and agricultural finance. In January 2011, Ecobank Transnational acquired majority shareholding in Premier Finance Group, at a price of US$10 million. Following the change in ownership, the institution rebranded to Ecobank Zimbabwe in May 2011. It also requested and was granted permission to change its merchant banking license to a commercial banking license.

The restructuring exercise helped the Bank to turnaround a near collapse to becoming one of the top performing banks in Zimbabwe.

It has curved a niche in trade financing leveraging on the parent and taking advantage of dwindling correspondence banking to spur its non-funded business. This bank has recorded superior returns ahead of the market and is on course to complete a two year run on strong earnings growth, hence the recognition as the 2019 overall Banking Sector winner.

First runner up – POSB

This bank has shown a consistent growth pattern in earnings over the last 4 years defying a past of losses and low capitalisation. At one point it was the only profitable parastatal entity and this was achieved through an internal reformation of the bank. Its growth has emanated from quicker adoption of ICT and prudence in lending. The bank’s ratios have firmed to healthier levels above the sector’s average. For performing so competitive and ahead of sector heavies and defying the conventional loss making parastatal path, POSB is this year’s first runner up

Second runner up – NMB

The bank has emerged from a volatile past and it has stood the test of time. Having received shareholder support in recent years, it went on to aggress on either fronts, digitising the bank as well as spur the loan book. The bank is among the few speeding up innovation in Fintech and its results have been showing. Its latest earnings results show a bank that is already reaping early gains from digitisation through a very low income to OPEX level.

“Thank you our customers and our peers in the banking sector for inspiring us to pursue excellence,” NMB CEO, said.

Most sustainable CSR award – FBC

Sustainability cannot be overemphasised in business in the 21st century and a key component beyond the economic is the social impact of business in communities it operates. Companies are now encouraged to look beyond profitability and invest in enhancing the lives of ordinary citizens who makes their businesses viable through trade. In the first half the year, the country was engulfed by a dark cloud Cyclone Idai descended upon the Eastern Highlands province of our beloved country. Banks and other corporates rose to the occasion taking a lead role in facilitating rehabilitation of affected communities. That was indeed plausible. However one bank went a step further creating a lasting impression on the affected communities, which is as sustainable. This year’s winner is a bank which committed to construct classroom blocks one in Chimanimani and the other in Masvingo and has already initiated moves to begin the construction. The winner is FBC Bank.

Mobile application of the year – CBZ touch

Bank incomes from conventional lines have evolved in recent years, non-funded income whose main component is fee and commission now dominates income contribution ahead of interest income. This speaks to the impact of ICT in banking notably in financial technology. It is paramount that banks begin to put more emphasis on this income line to avoid redundancy and loss of market share even as income lines may grow. One pertinent aspect of ICT in banking which mobile banking facilitates is conducted through applications and on web as well on mobile network. Mobile now accounts for 72% of all banking transactions done globally and it is apparent that we recognise the bank which has the most popular application. The winning application has the most downloads online and high security features and is the most frequently updated application among all banks. CBZ’s One Touch is the inaugural winner of the Mobile Application of the year award.

Most innovative bank – Steward Bank

A banking sector survey conducted in the UK shows that there is a high positive correlation between customer service and new customer acquisitions. Trends in banking show that customers are now increasingly demanding for high convenience in banking and it is innovation which has come in to close the gap. In Zimbabwe most banks are now focussed on this particularly aspect and are investing significantly in ICT. However this is still an evident skills gap in the market which implies core banking systems are not adequately exhausted via APIs thus stifling product development. The inaugural winner of the award is a bank which has amassed the highest number of new clients, increased client engagement through introducing BOTS, reduced the time and layers of processes to open an account as well as led the market in development of mobile based loans and mobile application based low cost banking. It now accounts for over 30% of the market share in fee and commission income.

Special Award, Best Non Funded income – Steward Bank

The banking landscape is tilting and so are the income lines. The game in banking is highly tending fee and commission income which is traditionally one of the 2 dominant income lines in banking. For the first time since 2009, the banking sector generated more income from fee and commission than from funded business. This is in line with global trends and Zimbabwe banks have upped their games. However one bank stands out and although its half year 2020 results are yet to be released indication from full year results as well as historical performance has shown that one bank has a very wide margin ahead of peers in terms of its efforts to harness fee and commission based income. Others are catching up but this bank is a trend setter.

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