CBZ targets US$2bn balance sheet

LIVINGSTONE MARUFU

CBZ Holdings Limited has projected its balance sheet to surpass US$2bn by 2028, riding on strong deposit mobilisation, expanding credit lines, and a deliberate shift toward real sector financing aimed at sustaining long-term growth.

The publicly traded group has already built significant momentum, growing its balance sheet from US$1bn in 2024 to between US$1.5bn and US$1.6bn within just two years, placing it firmly on track to meet its medium-term ambitions.

Chief executive officer Lawrence Nyazema told Business Times that the group’s expansion strategy is anchored on disciplined execution, with clear targets for both asset growth and profitability.

“We believe we are on a sustainable growth path. We have been sharing with the market our ambitions for 2028, where we said we want to double our balance sheet from US$1bn within four years,” Nyazema said.

“Now we are around US$1.5bn to US$1.6bn, and we believe we are well on course to achieve our US$2bn balance sheet target. We also set a goal to generate at least US$100m in profit from that balance sheet.”

The group is steadily progressing toward its earnings target, having posted net profit of US$54m, although Nyazema noted that tax pressures weighed on performance.

“We are on US$54m in net profit this year, but we were affected by tax. Under last year’s conditions, we could have been closer to US$66m, which brings us nearer to the US$100m target,” he said.

Despite global and domestic uncertainties, CBZ remains confident in its strategy, acknowledging headwinds while positioning itself to navigate them through diversification and regional expansion.

“We do not take for granted that there are headwinds, that is precisely why we exist, to deal with them. There is no specific day when we say we will reach US$100m because there will always be challenges,” Nyazema said.

“We will leverage the diversity of our group and the regional footprint we are beginning to build to mitigate risks that may arise locally.”

CBZ is increasingly pivoting toward financing productive sectors of the economy, including manufacturing, infrastructure development, and agriculture, a move aimed at driving broader economic transformation.

Nyazema emphasised the need for integrated financial solutions that go beyond traditional lending models, particularly in housing and infrastructure development.

“As the financial services sector, we must also be focused on growth. Government has made progress, especially in road infrastructure, but we must go further,” he said.

“We should not simply be developing stands. That creates additional financial pressure for beneficiaries who are still paying rent while servicing land purchases. The time is right for complete solutions — incorporating renewable energy and reliable water systems — so that we deliver real value.”

Zimbabwe’s economy is estimated at US$52.8bn as of 2025, yet total banking sector deposits remain around US$5bn, highlighting a significant gap largely driven by the dominance of the informal sector.

CBZ sees this disparity as a major opportunity.

Nyazema said the group is refining its lending models to better accommodate informal sector participants, moving beyond rigid requirements such as payslips toward more flexible, behaviour-based credit assessments.

“On the long-term side, housing, vehicles, and other solutions, we must be more consistent and realistic. It is not just about asking for a payslip,” he said.

“It is about understanding what the customer wants and whether they can demonstrate, over time, their ability to honour commitments. If it is a house, no one wants to lose their home, and that in itself drives repayment discipline.”

He added that targeted financial solutions could unlock significant liquidity from informal traders, particularly through structured housing and micro-financing initiatives.

CBZ’s deposit base has also recorded strong growth, rising by US$232m, nearly a quarter of a billion dollars, largely driven by increased activity from individuals and businesses.

“A significant portion of that growth came from current accounts, meaning people are now more comfortable leaving their money in the banking system,” Nyazema said.

“We also saw growth in fixed and savings deposits. Importantly, only US$42m of the increase came from lines of credit, which means about US$190m was organic growth from customers transacting more and holding higher balances.”

The trend, he noted, signals improving confidence in the financial system, with more funds gradually moving from informal channels into formal banking institutions.

“We are beginning to attract some of the money that has traditionally been kept under mattresses,” he said.

However, Nyazema stressed that unlocking the estimated US$5bn circulating in the informal sector will require a coordinated effort between financial institutions and policymakers to sustain confidence and stability.

“As people gain confidence that their savings are secure, they will increasingly transact within the formal system,” he said.

Despite scooping multiple awards locally and internationally, CBZ is pushing for greater scale and relevance on the continent.

The group is targeting a market capitalisation of over US$500m in the near term, up from the current level of close to US$400m, as it seeks to reposition itself within Africa’s mid-tier banking segment.

“We want to move beyond competing with smaller banks and position ourselves within the continent’s mid-tier category. That requires scale, discipline, and consistent growth,” Nyazema said.