First Capital Bank shuts branches
…Accelerates push to digital services
LIVINGSTONE MARUFU
Financial services provider, First Capital Bank, says it has cut the number of branches as the lender accelerates the push from brick-and-mortar branches model to digital services.
The bank’s spokesperson, Tsitsi Munyaradzi, told Business Times that the lender’s new operating model aims to create optimal operating efficiencies in response to local and global trends impacting the banking industry.
“This saw us remain with a branch network of 25 branches and service centres countrywide dedicated to providing customised daily service to our customers and clients, a slight reduction from the 32 branches as at 2010,” Munyaradzi said.
The lender, recently launched WhatsApp Banking Chatbot, Alisa and Reverse Billing also known as Zero-Rating service which enabled customers with Econet lines to access internet banking and mobile banking applications at no cost.
Asked if First Capital Bank was going to retrench workers, Munyaradzi said: “We can confirm that there are no plans for a retrenchment exercise at this current time and First Capital Bank Limited remains focused on providing banking excellence to customers and clients.”
In its financial results for the year to December 2020, First Capital Bank swung into a profit amounting to ZWL$472.2m from a loss of ZWL$732.4m reported in 2019.
The bank’s total deposits grew by 331% to ZWL$4bn, while foreign currency deposits grew by ZWL$3.7bn.
The local currency deposits were deployed into loans, which grew by 279% to ZWL$2.3bn, a 63% loan to deposit ratio.
Foreign currency loans declined in value due to the repayments of high value corporate loans held prior year, although volumes increased compared to prior year.
Cost to income ratio improved to 50% from 95% on the back of growth in income.
Funded income grew by 695%, driven by increase in loans and advances together with an improved loans yield.
A surge in transactional activity resulted in increased fee and commission income.
Operating costs increased on the back of inflation, exchange rate depreciation and Covid-19 related expenses.
The bank said it remained focused on efforts to contain the increase in costs.
The increase in impairment charge was the result of exchange rate movement on foreign currency assets together with the growth in local currency loans.
The banking industry has seen realignment as players embrace digitisation in response to the obtaining environment.
The realignment has seen some banking institutions shedding jobs as part of drastic actions to curtail spiralling costs and rationalise their operations in a difficult operating environment.
Experts say the job carnage could turn to be worse in the second half of the year as more lenders are expected to put more employees on the chopping block in response to the realities of soaring costs, digitisation and Covid-19 pandemic, which have piled misery on the banks.
