FBC Holdings Limited’s profit after tax for the half year ended June 30 went up by 13% to $9,3 million due to an increase in net interest income during the period under review.
BY VICTORIA MTOMBA
The group’s profit after tax was up from $8,1 million in June 2015.
In a statement accompanying the group’s financial results, FBC Holdings chairman Herbert Nkala said a total income of $46,6 million was posted, indicating a 16,8% increase from $39,9 million achieved during the same period last year.
“Net interest income registered a commendable growth of 36,6% to $22,5 million contributing 48% of total income, up from 41% contribution for the same period last year. The growth in interest income was mainly driven by an improvement in the cost of funding, overall growth in interest earning assets and the re-classification of suspended interest income to earned interest income, following the performance of some material and non-performing loans,” Nkala said.
During the period a total of 32 133 244 shares were traded at a volume weighted average price of 6,03 cents and the counter closed the period at 6,4 cents reflecting a 8,5% drop from 2016 opening price of 7 cents.
“The share price continues to be heavily discounted, when compared to the net asset value of 17,08 cents per share and the future earnings capacity of the group,” he said.
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Nkala said the economic environment remained fragile during the first half of the year and growth prospects have been revised downwards to 1,4% from an initial projections of 2,7%. He said the prevailing cash shortages and nostro funding challenges, however, have adversely affected the reputation and growth prospects of the industry.
He said the insurance sector has also suffered from subdued business as evidenced by declining premiums and reduced profitability levels across the insurance sector.
