- Total Deposits Rise: Reached ZWG1.9 billion (US$137.1 million), a 12.5% increase
- Profits Soar: PAT of ZWG155.5 million (US$11.5 million), up 168% from ZWG58.0 million (US$4.3 million)
- Comprehensive Income Rebounds: To ZWG169.1 million (US$11.6 million) from a comprehensive loss of ZWG25.7 million (US$2.4 million)
Harare- First Capital Bank's loans to customers in HY24 increased to ZWG1.3 billion (US$94.7 million) from ZWG1.2 billion (US$86.1 million) at the end of 2023, reflecting a growth rate of 11.2%.
This positive trend was accompanied by a significant improvement in loan quality, with the nonperforming loans ratio dropping from 8% to just 3% over the six-month period.
Such performance indicates a strengthening of the Bank's lending practices and customer confidence.
Improvement in the nonperforming loans (NPL) ratio signifies enhanced loan quality and better risk management practices. A lower NPL ratio indicates that a smaller proportion of the bank's loans are at risk of default, which can lead to reduced provisions for loan losses.
This improvement not only boosts the bank’s profitability but also enhances its reputation among investors and regulators.
A healthy NPL ratio is crucial for maintaining investor confidence, as it reflects the bank's ability to manage credit risk and ensure that its lending practices are sound.
When a bank successfully grows its loan portfolio while maintaining a low NPL ratio, it indicates effective risk assessment and customer vetting processes.
This balance between growth and risk management is essential for long-term sustainability and can position the bank favorably in a competitive market.
Total deposits rose to ZWG1.9 billion (US$137.1 million), marking a 12.5% increase compared to ZWG1.7 billion (US$123.1 million) in 2023.
An increase in deposits is a positive indicator for a bank, reflecting customer confidence and a growing base of funds available for lending and investment.
When customers choose to deposit more money, it strengthens the bank's financial stability and liquidity. This increased capital allows the bank to extend more loans, invest in growth opportunities, and enhance its overall profitability.
“This trend reflects a rebound after balances had marginally come off in the first quarter against the backdrop of an unstable currency framework which experienced relief after the monetary interventions announced by the central bank at the beginning of the second quarter,” Tapera Mushoriwa, the Bank’s CEO said in a statement accompanying the financials.
Total income grew by 12.8% from ZWG435.9m (US$32.1m) to ZWG491.6m (US$36.4m) driven by an improvement in the underlying business, with net interest income and non-interest income increasing by 23.3% and 6.8% respectively.
As a result, the Bank reported a profit after tax of ZWG155.5 million (US$11.5 million), more than doubling by 168% from ZWG58.0 million (US$4.3 million) in the same period last year.
This surge in profitability reflects the Bank's robust operational performance, driven by a strong increase in net interest income and non-interest income.
Total comprehensive income reached ZWG169.1 million (US$11.6 million), representing a staggering 658.8% increase from a comprehensive loss of ZWG25.7 million (US$2.4 million) recorded in 2023.
With ongoing efforts in cost rationalization, the Bank anticipates further efficiencies and growth in the latter half of 2024.
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