CBZ submits $28m NPLs to Zamco

CBZ Holdings has forwarded $28 million non-performing loans (NPLs) to a government-created special purpose vehicle, which houses secured non-performing loans.



Last year, the government created the Zimbabwe Asset Management Company (Zamco) to buy secured NPLs and free balance sheets of banks so they can be able to lend again.

At one time, the ratio of NPLs to total loans peaked at 20,45%. There are attempts to bring the ratio to 5% by December 31.
Speaking at CBZ’s analyst briefing recently, group chief executive officer, Never Nyemudzo said: “We have put forward some of our NPLs, $28 million of these loans have been successfully rated by Zamco, we are expecting to conclude the transaction.”
He said Zamco was expected to bring relief to banks.

In his monetary policy statement, central bank chief John Mangudya said Zamco had acquired NPLs amounting to $357 million as at December 31, 2015.

“The restructuring involved extending the loan repayment period, grace periods for capital repayment and reducing interest rates and in some instances converting debt into equity,” he said.

In the financial year ending December 31, 2015, CBZ Holdings saw its profit after tax rising by 6,7% to $35,2 million from the previous year’s $33 million powered by a growth in total income.

The group’s total income surged to $184,2 million from $154,57 million in 2014, with the bulk of that coming from its banking unit, CBZ Bank.

Non-interest income constituted 40,8% of the total income down from 42,8% in 2014. This means that the group was deriving the bulk of its income from interest on loans and not from fees, commissions and bank charges. The central bank has been urging banks to retain customers by levying lower bank charges.

Operating expenditure was up to $117,85 million from $98, 66 million. Deposits were up 18,9% to $1,68 billion from $1,4 billion. Total advances retreated by 9,3% to $1,02 billion during the period under review from $1,12 billion in 2014.

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