Stanbic profit up 220%
BUSINESS REPORTER
Stanbic Bank more than trebled its inflation-adjusted profit to ZWL$11.2bn in the half year ended June 30 from ZWL$3.5bn in the comparable period last year on the back of an increase in income which surpassed the growth in operating expenditure.
Stanbic Bank chairman Gregory Sebborn said the strong set of results were driven by the institution’s proactive response to the growing working capital requirements from customers through the provision of lending facilities in both local and foreign currency at a time when the cost of doing business had been trending upwards.
In a statement accompanying the results, Sebborn said revaluation gains recorded on the bank’s foreign currency positions combined with fair value adjustments on investment properties as the ZW$ currency continued to weaken against the US$ also contributed significantly to the performance.
The bank’s net interest income grew by 66% to ZWL$12.3bn from ZW$7.5bn in the same period last year.
CE Solomon Nyanhongo said the growth in net interest income was “largely spurred by the strong growth in interest earning assets as new lending assets were written compounded by the upward review of interest rates during the period”.
“Fee and commission income for the period had increased by 21% from ZW$7.8 billion in 2021 to ZW$9.5 billon largely underpinned by the improved volumes of transactions which were being processed on our various service channels,” Nyanhongo said.
He said the bank’s trading revenue improved, supported largely by the better trading activity in the market combined with revaluation gains recorded on foreign currency positions. The bank’s credit impairments ended the period at ZW$1.1bn growing from a net release of ZWL$ in the prior period, on the back of new lending assets which had been written in the period.
In the prior period, significant recoveries were recorded on Stanbic’s financial assets.
Total operating expenses increased by half to ZWL$14.2bn from ZW$9.4bn due to the impact of the continued weakening of ZW$ currency against the US$ on the bank’s foreign-denominated expenses which have increased substantially in local currency terms.
Stanbic’s net lending book grew in real terms by 10% from ZW$67.9bn in December 2021 to ZWL$74.8bn as new lending assets were written in an effort to support clients in meeting their working capital requirements.
