- Profit Decline: CBZ Holdings reported a profit after tax of ZWG 656.3 million, nearly halving from ZWG 1.2 billion in the previous year
- Strong Financial Position: The Group maintained a robust capital base of ZWG 17.59 billion, supported by customer deposits of ZWG 11.50 billion
- Positive Outlook: Anticipated improvements in the agricultural sector and continued public infrastructure investments are expected to drive future growth
Harare- CBZ Holdings experienced a significant contraction in net profitability during the half-year ended June 30, 2024, as total revenue income and tax liabilities escalated substantially.
The group's profit after tax (PAT) plummeted to ZWG 656.3 million, a 45.5% decrease from the prior year's ZWG 1.2 billion, primarily due to a 41.4% decline in total income to ZWG 1.7 billion from ZWG 2.9 billion.
However, profitability was maintained.
“This performance was buttressed by our customer-centric approach to nurturing relationships with our customers, accessible and reliable digital platforms, enhanced disbursements, and a diverse product offering to address the financial needs of our valued customers,” Luxon Zembe, group chairperson said in a statement accompanying the financials.
The downturn in net income was largely attributed to a 57.7% decrease in non-interest income, which plummeted from ZWG 2.6 billion to ZWG 1.1 billion.
Additionally, deposits witnessed a 6.5% decline to ZWG 11.5 billion from ZWG 12.3 billion.
Conversely, loans and advances to customers exhibited a modest 2.2% increase to ZWG 4.7 billion from ZWG 4.6 billion.
The change in currency from the hyperinflated Zimbabwe dollar to the Zimbabwe Gold (ZWG) on April 5, 2024, had a profound impact on the group's financial performance.
The currency reform aimed to combat hyperinflation and stabilize the economy. However, the transition might have also resulted in significant accounting adjustments, leading to a substantial decrease in total income and, consequently, net profitability.
However, despite these challenges, the group's loan book exhibited resilience, indicating a stable demand for credit facilities.
“The Group will continue to reconfigure and position its business model towards unlocking long term value for its stakeholders,” said Luxon Zembe the group’s chairperson.
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