CBZ Holdings saw its 2016 profit after tax dropping by 32,5% to $28,3 million from the previous year on the back of a decline in net interest income.
BY BUSINESS REPORTER
In 2015, profit after tax was $35,2 million.
Net interest income was down to $81,6 million last year from $109,12 million in 2015.
Interest income is the main avenue banks make their money apart from fees and commissions and trading revenue. Banks make money by lending it at rates higher than the interest they pay on deposits.
The decline in net interest income saw non-interest income’s contribution to total income increasing by nearly 10 percentage points to 43,4% in 2016 from 34,3% in the previous year.
Net non-interest income rose to $69 078 973 in 2016 from $62 582 558 in the comparable year driven by an increase in fees and commission income.
Commission and fee income rose to $56 482 839 last year from $48 186 788 in 2015.
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Total deposits grew by 5,5% to $1,77 billion. Advances declined by 1,4% to 1 billion from $1,02 billion.
In the outlook, CBZ Holdings board chairperson, Elliot Mugamu, said it was critical for authorities to “follow through on policy pronouncements made in 2016, including the arrears clearance strategy and the accelerated implementation of key reforms under the Rapid Results Initiative”.
“Agricultural output is expected to improve, leading to preservation of foreign currency for other critical imports,” Mugamu said.
