Zimbabwe Allied Banking Group (ZABG) narrowed its loss in the first six months of the year as new shareholders moved in to shore up the bank’s balance sheet.
Mines and Mining Development minister Obert Mpofu’s investment vehicle, Trebo and Khays Limited, recently injected fresh capital into the bank.
As a result, during the period under review, the bank’s asset base grew to $40 million.
Trebo and Khays holds 99,5% shareholding.
The bank’s losses were down to $1,1 million in the six months to June from $2,6 million during the same period last year.
Operating expenses were down to $4,4 million from $5,4 million in the corresponding period. The group’s total asset base grew by 153% to $40 million.
Net interest income declined by 24% on the back of reduced loan underwriting capacity leading to a 30% reduction in total income.
In a statement accompanying the bank’s interim results, ZABG chief executive officer Stephen Gwasira said the bank’s capital now stood at $18 million. Gwasira said the bank had embarked on new initiatives aimed at raising new capital in order to strengthen and meet the new $100 million minimum capital threshold set by the Central bank.
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“Of note are the shareholders’ funds which grew from a negative $10,4 million to a positive $18 million from the capital injection,” Gwasira said.The bank has added a new branch in Victoria Falls and also reintroduced automated teller Machines.
ZABG on Tuesday announced the appointment of a new board chaired by Harare lawyer Farai Mutamangira.
Mark Wood, an associate and fellow of the Institute of Bankers, is the new deputy chairman. Mpofu’s wife Sikhanyisiwe is also a member of the board. Other board members are Graeme Mcintosh, Togarmah Dhlakamah and Abdullah Kassim.Gwasira is the chief executive officer.
Frank Karara has been appointed the operations director, Ethel Chitanda finance director, while Florence Gowora is the business director.
Mutamangira said given that most of the country’s citizens were unemployed, a significant portion of the loan book would be advanced to the small to medium scale enterprises.
“ZABG’s recapitalisation not only increased the bank’s core capital, but it also substantially strengthened the bank’s statement of financial position,” he said.
As of December 2011, the bank was one of four ailing financial institutions that had failed to raise the minimum capital requirement of $12,5 million for commercial banks as stipulated by the Reserve Bank of Zimbabwe.
