Key Highlights:
- Total income declined from ZW$4.128 billion to ZW$2.897 billion
- Attributed to a 67% decrease in fair value credits
- Net interest income rose by 149% to ZW$0.909 billion
- Group total assets grew to ZW$28.711 billion
HARARE – One of Zimbabwe’s leading financial services providers, ZB Financial Holdings Limited saw its net profit decreased by 66% and revenue declined by 30% in the half-year of 2021, compared to the same period last year, according to its financial results statement released on Friday.
The Group’s net profit in the January-June period of 2021 came in at ZW$0.785 billion in inflation-adjusted terms, representing a 66.2% decline from the ZW$2.320 billion attained in the same period 2020.
The Group which provides financial solutions to the commercial and merchant banking sector in Zimbabwe, as well as retail banking services, insurance operations, and strategic investments, posted a total income of ZW$2.897 billion in the period under review which was down 29.8% from ZW$4.128 billion the same period of last year.
“The decline in revenue performance was mainly underpinned by a 67% decrease in fair value credits, from ZW$1.571 billion in 2020 to ZW$0.519 billion in 2021 and an 80% decline in other operating income from ZW$1.706 billion in 2020 to ZW$0.336 billion in 2021,” Group Chief Executive Officer Shepherd Fungura said in the statement.
A profitable outturn was recorded as net interest income rose by 148.6%, from ZW$0.366 billion in 2020 to ZW$0.909 billion in 2021, whilst banking commissions and fees also rose in real terms by 115.6%, from ZW$0.533 billion in 2020 to ZW$1.15 billion in 2021.
Meanwhile, net insurance related earnings rose from ZW$0.116 billion in 2020 to ZW$0.239 billion in 2021, on the back of a favourable claims experience.
Gross premiums increased by 18.4% from ZW$0.592 billion in 2020 to ZW$0.701 billion in 2021, whilst there was a 3.1% decrease in insurance related expenses from ZW$0.477 billion to ZW$0.462 billion during the same period.
However, operating costs increased by 73.5% from ZW$1.180 billion in 2020 to ZW$2.048 billion in 2021, largely as a result of the catch-up adjustment on the cost base in tandem with the inflation profile.
The Group’s flagship asset, ZB Bank Limited posted a profit of ZW$0.506 billion for the six months to 30 June 2021, 66.4% down from ZW$1.504 billion in the corresponding period in 2020.
“This was mainly on the back of a 72.7% increase in operating expenses from ZW$0.976 billion in 2020 to ZW$1.686 billion in 2021,” said CE Fungura.
The Bank’s total assets stood at ZW$19.769 billion as at 30 June 2021, from ZW$15.006 billion as at 31 December 2020. This contributed to the Group’s total assets increasing by 25.4% in real terms, from ZW$22.903 billion as at 31 December 2020 to ZW$28.711 billion as at 30 June 2021.
Highlighting internal processes, Fungura said that the Group is progressing the digitalisation agenda in order to enhance its operational efficiencies and most importantly, offer improved service delivery to its customers.
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