STANBIC Bank Zimbabwe Limited (Stanbic) has defied macro-economic challenges after posting a profit after tax of $1.2 billion which saw the group sustaining a profitable position since 2019.
Presenting the financial performance covering the first half of 2021, Stanbic chairperson Gregory Sebborn said the current profit margins are $100 million slightly lower than the figure of $1.3 billion recorded during a comparable period last year.
He attributed the decline in profits to the depressed performance of the trading revenue line owing to subdued activities during the interim period.
"The foreign currency shortages in the market combined with periods of lockdown also contributed to the marginal reduction in profit for the Standard Bank Group subsidiary. In addition, operating expenses increased in comparison to the prior year driven by the expenditure of $430 million in the staff optimization exercise," Sebborn said.
The bank ended the six months period to June 2021 with a qualifying core capital of $5.7 billion, outpacing the local currency equivalent of the required US$30 million regulatory minimum set by the Reserve Bank of Zimbabwe.
Chief Executive, Solomon Nyanhongo, said the institution recorded a 218% growth in its net interest income, closing the period at $2, 6 billion and surpassing the income of $803 million for the prior period.
"The uplift in interest income was largely buttressed by the strong growth in interest-earning assets during the period as new lending assets were written.
Fee and commission income for the period had grown by 167 % from $ 1 billion in 2020 to $2.7 billion, largely spurred by the improved volumes of transactions witnessed during the two months lockdown period of January and February 2021," he said.
Nyanhongo said Stanbic embarked on a staff optimization exercise during the first half of the year which led to the increase in its total operating expenses from $ 2.7 billion in the comparative period to $3.2 billion.
"This was on the back of progress in the Bank’s digitization strategy which saw an expansion in the digital solutions available for our transacting customers," said Nyanhongo.
He said the demand for local currency funding continued on an upward trend during the period as working capital requirements swelled.
