ZBFH abandons Mozambique plans

Published: 24 August 2017

ZIMBABWE Stock Exchange-listed financial services provider, ZB Financial Holdings Limited (ZBFHL), has abandoned plans to set up a unit in neighbouring Mozambique due to foreign currency shortages.

Ronald Mutandagayi, the chief executive officer of ZBFH, confirmed the development to The Financial Gazette last week.

"Establishment of physical presence in Mozambique has stalled on account of foreign currency shortages. Investments are classified (by the Reserve Bank of Zimbabwe) as priority number four," said Mutandagayi.

The central bank introduced a priority list for foreign currency allocations after foreign currency shortages intensified last year.

ZBFHL secured a licence to set up an insurance business in Mozambique last year, but has been underwriting business in that country from its Harare offices.

The financial services provider had planned to establish physical offices this year in a bid to grow revenues and spread risk.

Mutandagayi said Mozambique was a fast growing economy and ZBFHL wanted to be part of the existing opportunities arising in that country.

In the first half of the year, ZBFHL posted a 38 percent increase in profit to $8,17 million, from $5,94 million during the comparative period the previous year.

Revenue went up 17 percent to $34,47 million, from $29,39 million recorded in the same period the previous year.

Total expenses during the period under review increased by 10 percent to $23,92 million, from $21, 83 million during the comparable period the previous year, due to increased business acquisition costs and amortisation of investment in technologies.

Total assets went down by two percent during the period under review to $430,8 million due to decrease in cash and cash equivalent balances.

Treasury Bill portfolio went down one percent to $117,2 million during the period under review, from $118,6 million recorded in the same period the previous year as short-term instruments matured.

Deposits in the bank went down by six percent to $259,8 million during the interim period, from $275,3 million during the same period in 2016.

The group's non-interest income ratio went up to 77 percent during the period under review compared to 68 percent during the same period the previous year.

The net interest income ratio went down to 23 percent during the review period, from 32 percent in during the interim period in 2016. Cost to income ratio improved to 69 percent during the period under review from 74 percent reported in previous comparable period due to improved revenue outturn.

Liquidity ratio was at 72 percent from 75 percent.
- fingaz

Tags: ZBBank,