THE People’s Own Savings Bank (POSB) advanced loans to its clients totalling $57 million in the year ended December 31 2012, up from $48 million in the prior year with the bulk being individual loans.
NQOBILE BHEBHE
In a trade update accompanying its financial results, the bank’s acting board chairman Israel Ndlovu said POSB recorded a $2,47 million after-tax profit representing a 40% decrease from the $4,11 million recorded the prior year.
“The bank’s revenues for the year increased by a marginal 10% compared to last year. This performance was however not enough to counter the growth in expenditure which was 23%.
“This resulted in a bottom line of $2,47 million which was 40 % below last year’s profit,” said Ndlovu.
Ndlovu said the capital adequacy ratio of 14,51 % exceeded the prescribed minimum regulatory ration of 12% and it enabled the bank to meet its prudential lending guidelines.
The bank’s cost-to-income ratio deteriorated from 80% in 2011 to 89% in 2012, Ndlovu said.
Total assets and deposits grew by 24% (from $65,05 million to $80,57m) and 23% (from $51,99 million to $63,81 million) respectively.
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Loan-to-deposit ratio dropped from 76% in 2011 to 59 % in 2012 and this was attributed to a “constrained capital base which did not allow the bank to underwrite significant business”.
On loans, the bank advanced $31 581 444 last year down from $32 628 981, manufacturing sector ($2 146 648 down from $2 871 004), distribution ($3 058 795 up from $2 754 559), finance ($508 032 up from $410 029), mining ($133 221 from $237 183 ), agriculture ($354 690 down from $376 440) and other services got $1 835 278.
Ndlovu said Zimpost which handled an average of 6% of the bank’s business continued to be a key strategic partner in its expansion drive.
Going forward, Ndlovu said POSB would this year strive to increase its presence physically and electronically and was looking at introducing an upgraded core banking system in order to improve operational efficiencies.
