Stanbic Bank Zimbabwe has shrugged off the prevailing harsh economic environment to post an impressive profit after tax of $27.6 million for the year ended December 2017, a 30% increase from US$21.2 million recorded in the prior year.
The bank’s Chairperson, Gregory Sebborn, attributed the performance to the returns on the various interest earning instruments that the leading financial services institution invested in.
In a statement accompanying the results, Sebborn said income earned from the growing transaction volumes on the various innovative electronic channels that Stanbic Bank offers as well as good recoveries on previously downgraded facilities contributed significantly to the bank’s performance.
He said the operating environment presented a plethora of challenges such as broad money supply growth which grew by 47.97% to US$8.02 billion in October 2017 compared to USD5.42 billion in November 2016.
Sebborn said although the export performance during the first nine months of 2017 improved by an estimated 19% compared to same period in 2016, bolstered by increased gold, chrome and ferrochrome exports, other key foreign currency sources such as Foreign Direct Investment (FDI), international remittances and portfolio investments remain significantly subdued.
“Despite these challenges in the macroeconomic environment, the Bank continued to sustain growth in profitability, closing the year with a profit after tax of USD$27.6 million which was 30% ahead of the prior period profit after tax of USD$21.2 million,” said Sebborn.
As at 31 December 2017, Stanbic Bank’s qualifying core capital stood at US$134.3 million, up from US$106.6 million in 2016, against the regulatory minimum of US$25 million and ahead of the USD$100 million threshold set for the year 2020.
Stanbic Bank’s net lending book increased by 21% from US$273.5 million in 2016 to US$330.4 million largely driven by new assets which were written combined with the increase in facility utilisation by some counter parties who required local funding for working capital purposes.
As the country remained crippled by chronic foreign currency shortages, the Bank’s customer deposit base increased from US$701 million in 2016 to close the year at USD$1.2 billion as depositors failed to utilise their funds for settlement of foreign obligations.