STANDARD Chartered Bank Zimbabwe saw its profit after tax increasing by over 3 000% to $13,43 million for the year ended December 31, 2016 from the comparable period in 2015 due to cost efficiencies.
BY TATIRA ZWINOIRA
In 2015, the bank posted a profit after tax of $402 912.
The jump in earnings came despite a drop on net interest income to $21,34 million in the period under review from 2015’s $23,91 million. Net interest income is the main avenue banks make their top line. The other route is non-funded income derived from fees, commissions and services charges.
In a statement accompanying the bank’s financial results, board chairperson Samuel Vengai Rushwaya said the profit increment was as a result of it improving its operating systems.
“The improved financial performance was achieved on the back of costs efficiencies attained during the year as the bank continues to innovate and improve its operating systems and processes,” he said.
“Considerable efforts have been made to contain loan impairments through continuous collaborations with our customers.”
He said the bank would continue taking advantage of opportunities as capacity utilisation increases.
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As the bank experienced higher profit margins, its operating expenses was down to $38,52 million for the period under review from $55,43m million recorded in the previous year.
Total revenue was down to $55,02 million for the period under review from the previous year’s $62,39 million.
“Revenue momentum declined year-on-year due to a prudent lending strategy which ensured that only those customers with capacity to repay could access lines of credit,” Rushwaya said.
To that effect, loans and advances to customers for the period under review were $125,14 million, down from $163,3 million in the previous year.
Cash and cash equivalents was up for the period under review to $199,08 million from the previous year’s $127,81 million. Deposits from clients increased to $395,15 million in 2016 period from $291,3 million in previous year.
Rushwaya said the bank would be spending $9 million over the 2016/17 financial year towards branch optimisation, refurbishment and digital platforms.
He said the branch optimisation process was aimed at reducing excess space.
“This year will see clients starting to benefit from efficiencies of our refreshed approach which aims to make service delivery simple, faster and better,” Rushwaya said.
Refurbishment of the Robert Mugabe, Gweru and Bulawayo branches has been completed, while the remaining six branches are expected to be finished mid-year.
