• Revenue almost doubled to 51.375 billion
  • Operating Costs soar by 41% to ZW$22.995 billion
  •  Deposits and other funding increased by 24%

Harare- One of Zimbabwe’s oldest financial institutions, ZB Financial Holdings, recorded a stellar financial performance during the third quarter ended 30 September 2022, the bank’s trading update reveals.

According to the Group, growth was realised against the backdrop of an increase in exchange rate volatility which resulted in a 69.69% depreciation of the local unit on the official Foreign Exchange Auction market.

The decline was characterised by a move from ZW$366.27 per US$1 as at 30 June 2022, to ZW$621.53 as at 30 September 2022. Annual inflation worsened by 88.8 percentage points in the period under review.

Revenue for the group for the nine months ending 30 September 2022 surged by 97% to ZW$51.375 compared to the prior year. The growth was propelled by an improvement in both interest and non-interest income.

Net interest and trading income jumped 41% year on year to ZW$ 12.406 billion hinging on loan book growth and margins benefit of rising interest rates.

An annual average interest margin of 35.55% was attained in Q1 FY’22, significantly higher than 26.16% from Q3 FY’22. The increase mirrors the partial offset against inflation.

Non-interest income spiked by 127% to ZW$43.031 billion year on year and was mainly composed of insurance premiums, fair value, foreign exchange gains, and commissions.

Net insurance premiums increased by 44% in the third quarter of 2022 in comparison to Q3 F’Y21 aided by the underwriting of new business and improvement in risk selection.

Banking commission income grew by 12% supported by a surge in transaction banking volumes.

Non-trading income skyrocketed by 263% and the spike was attributable to the 1600% jump in foreign exchange income.

Operating costs for the nine months ended 30 September 2022 shot up to ZW$22.995 billion, a 41% increase in comparison to the first nine months of 2021. This surge in part was propelled by costs associated with business transformation costs coupled with inflationary cost pressures.

Total assets increased by 16% from ZW$161.390 at the end of 2021 to ZW$186.453 billion as at 30 September 2022.

ZB Holdings kept its overall liquidity ratio over 60% against a benchmark of 30%.

The government continues to find ways to regulate the money supply by keeping interest rates high at around 200%, but the group still finds ways to keep lending to the economy's productive sectors.

The loan book climbed to ZW$41.780 billion, and as of September 30, 2022, the non-performing loans ratio was 0.28%.

Deposits and other funding accounts increased by 24% from ZW$62.870 billion at the end of 2021 to ZW$77.743 billion as at 30 September 2022.

The group anticipates that the present strict monetary policy, including the use of gold coins, will aid in stabilizing the economy even if they are fighting to survive the current economic difficulties.

The Group’s market capitalisation contracted by 33% from ZW$2,273.75 billion at the beginning of Q3 2022 to ZW$1,5522.70 billion at the end of September 2022.

The group continues to have a positive outlook because it anticipates attaining its performance goal for FY22. The company expects to complete its digitizing effort in Q4 FY’22. The digitalization program was at 72% completion during the most recent third quarter.

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