NMBZ Holdings Limited experienced a net income of ZWL$236 billion for the half year ended June 30, 2023, largely driven by growth in non-funded income and revaluation gains on investment.
The 2 837% growth in income was also driven by foreign exchange gains on United States dollar (US$) denominated net monetary assets.
Last year, total comprehensive income amounted to ZWL$8 billion.
Operating costs increased by 147% compared to the previous period, according to NMBZ chief executive officer Gerald Gore.
“The group continues to put in place measures to contain costs anchored on the digitalisation strategy,” said Gore, adding that the group traded profitably for the period under review while the balance sheet remained robust, anchored on US$ denominated assets.
Total assets closed the period at ZWL$1 trillion, driven by revaluation gains and foreign exchange gains.
The group’s value preservation strategies paid off as the balance sheet and capital position remained solid notwithstanding the significant deterioration in the exchange rate.
As of June 2023, month-on-month inflation reached a peak of 74,5% and the exchange rate depreciated by 755% since the beginning of the year.
In a statement accompanying the financial results, company chairperson Benedict Chikwanha said the group achieved operating income of ZWL$283 billion, up 444% on the prior period.
"This was driven by a significant increase in interest income and continued growth in fees and commission income," he said.
Chikwanha said the group continued to take a measured approach to risk, as evidenced by the strong asset quality with an non-performing loan ratio of 0,57% compared to 1,09% as at December 31, 2022.
The reversal in expected credit losses was ZWL$906 million for the period under review. Deposits and other liabilities grew by 109% from December 2022 levels.
“This was largely reflecting the impact of the exchange rate depreciation on USD deposits. The spot inter-bank mid-rate has been used to convert foreign currency-denominated transactions and the closing inter-bank mid-rate for all the closing balances,” he said.
Chikwanha said cost discipline remained a core focus for the group in the wake of increased inflationary pressures.
The main subsidiary, NMB Bank Limited remains well capitalised with a total capital adequacy ratio of 27,79%. Risk weighted assets stood at ZWL$1,2 trillion, up 675% from December 2022 levels.
The bank is in discussion with various providers of debt financing and the discussions are at various stages of finalisation. It is expected that draw-downs will commence in the third quarter of 2023.
In the outlook, the group will continue exploring opportunities for revenue growth and value preservation, while forging ahead to achieve its strategic objectives.
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