BancABC Zimbabwe's 1HFY17 profits rise to $3.2m

Published: 30 August 2017

BancABC Zim posted a significant rise in profit after tax to $3, 2 million for the first half of this year from $200 000 in the prior comparable period.

The profit bump was on the back of cost-containment strategies implemented in the period under review, as well as an upturn in revenue.

For the half-year to June 30, 2017, net interest income increased 25 percent to $15, 5 million compared to $12, 4 million in the prior year.

Fees and commission for the period declined by 26 percent to $3, 9 million from $5,3 million same period last year resulting from mixture of decline in fees from lending activities and impact of price caps by the Reserve Bank of Zimbabwe (RBZ).

Commented BancABC Zim chairman Mr Alvord Mabhena in a statement accompanying the results today:

"It is however, expected that once some of our digital initiatives come to market, fee and commission income will start to show a steady increase."

The bank's operating expenses decreased to $16, 3 million from $17, 3 million, while its cost to income ratio improved from 90, 3 percent to 75, 4 percent during the six months period.

It recorded a net impairment charge of $300 000, a 79 percent improvement percent which management attributed to its strategic objective to recover amounts previously written off, as well as efforts to reduce risk.

The bank's balance sheet surged 17 percent to $14 million compared to prior year.

BancABC Zim's capital adequacy ratio remained well ahead of regulatory requirement of 12 percent at 22, 5 percent driven by a decrease in risk weighted assets as profit retained from operations.

And core capital at the end of the period was also above the minimum capital of $25 million at $74, 4 million.
- BH24

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