ZIMBABWE’S largest mortgage lender, Central African Building Society (CABS), says its total loans and advances increased to $278,16 million in the full-year ending December 31 2012 due to improved mortgage funding.
In 2011 loans and advances amounted to $194 million.
CABS is a subsidiary of Old Mutual Zimbabwe.
Old Mutual Zimbabwe is in turn a subsidiary of Old Mutual PLC, an international financial services conglomerate with interests in South Africa, the United Kingdom, the United States, Kenya, Botswana, Namibia and Zimbabwe.
In a statement accompanying financial results, CABS chairperson Leonard Tsumba said the loan book included a total of $97,04 million for 10-year mortgages issued since the beginning of August 2010.
CABS recorded a surplus of $23,74 million in the period under review due to improvements in both interest and non-interest income.
The bank’s net interest income increased by 28% in line with increase in loans and advances.
“Net interest income contributed 57% to the Society total income indicating a return to the Society core business,” Tsumba said.
He said non-interest income increased by 27% mainly due to an increase in the number of transactions through the Society’s various delivery channels.
During the period under review, operating costs increased by 10%. The cost to income ratio was 56% down from 63% recorded in 2011.
Tsumba said the total assets increased by 46% in 2012 driven by deposits growth of 52% during the same period.
He, however, said the economy was estimated to have grown by 4,4% in 2012 down from 9,3% in 2011.
“Economic growth is, however, expected to continue through 2013, underpinned by strong growth in the mining and agriculture sectors of the economy,” Tsumba said.
He added that CABS had reopened eight branches to make banking more accessible throughout the country.
The banking sector deposits increased from $3,3 billion at December 2011, to $4,4 billion last year.