First Capital Bank reports US$4.3m profit in HY23
BUSINESS REPORTER
Victoria Falls Stock Exchange listed lender, First Capital Bank, reported a US$4.3m in the six months to June 30, 2023 from US$1.3m in the prior comparative period, barring the impact of the change in functional currency.
The lender said the growth was driven by an improvement in the underlying business, with net interest income and net fees and commissions having increased by 35% and 23% respectively.
Total income for First Capital Bank increased to US$32.1m from US$28.4m achieved in the prior comparative period.
Operating expenses increased by 22% from US$16.6m in the period under review to US$20.3m from US$16.6m in the prior comparative period, resulting in the cost to income ratio moving from 58% in June 2022 to 63% in June 2023.
In statement accompanying First Capital Bank financial results , the managing director, Ciaran McSharry (pictured), said the lender will continues to actively pursue cost optimisation strategies to manage the overall cost base.
The statergy comes as the bank has been battling spiralling costs.
First Capital has enhanced digital platforms to put the bank in a good stead to position new technology that supports its efforts to interact better with customers, paying particular attention to convenience, efficiency, and increased security.
Total deposits for the lender decreased 20% to US$109.5m in the six months to June 30 2023, from US$136.1m recorded in December 31, 2022.
“The bank’s total deposits turned out at US$109.5m on June 30 2023 which is lower than US$136.1m as of December 31 2022. The reduction was largely driven by the loss of value on Zimbabwe dollar denominated deposits following a 735% depreciation of the ZWL$ over the period. ZWL$ deposits constituted 8% of total deposits at June 30 2023 compared to 22% at December 31 2022,” First Capital managing director Ciaran McSharry said .
Loans to customers increased by 23% over the same period to close at US$79.5m, compared to US$65.9m as of December 31 2022, with 95% of business having been underwritten in US$ as at June 2023.
Asset quality remained satisfactory, with a loan loss ratio of 3.3%. Exposures with increased credit risk were largely within the agriculture portfolio. Whilst the overall default risk increased , this was within the bank’s appetite,” he said.
