Financial services provider, FBC Holdings Limited posted a ZWL$ 529.14 million profit after tax during the first half of the year on account of strong growth of the Group’s core business (fees and commissions) revenue lines which accounted for 66 percent of total income.
The Group’s strategic thrust of intensive investment in digitalization and hedging strategies contributed largely to overall performance.
Fee and commission income improved by 89 percent to ZWL$ 1.12 billion, partly supported by the Group’s digitalization thrust which enhanced retail and service fee performance.
Transactional volumes have generally been subdued within the financial services sector with most institutions implementing digital solutions to augment business growth.
The Group achieved a total income of ZWL4.75 billion for the period, representing a 34% decline from the prior year’s corresponding period performance.
“The Group’s subdued total income outturn was largely influenced by a 76 percent reduction in net trading and dealing income, following the stabilization of the ZWL interbank exchange rate against all the major currencies, bolstered by the foreign exchange auction system,” said Group chairman, Herbert Nkala.
“The significant reduction in this revenue line was counter balanced by a strong growth in other core business revenue streams.”
Net interest and related income was 43 percent ahead of the prior year’s corresponding period, at ZWL# 1.33 billion, leveraging on the Group’s 12 percent growth in loans and advances.
The Group reduced its minimum lending rate during the period under review in order to assist customers in coping with the Covid-19 induced low economic activity and reduced demand.
To scale up on its digitalization program, the Group has established a wholly owned strategic business called Xarani responsible for spearheading the development of innovative electronic products and services in response to the fast evolving needs of our customers.
The Group’s net insurance premium earned was 40% ahead of the same period last year, at ZWL635.16 million.
Net profit from property sales was ZWL$ 50.97 million, recording a significant growth of 350 percent compared to the same period last year.
“This was achieved as a result of an improvement in pricing and an increased number of units sold. The Group is set to improve this revenue line following significant progress achieved on the Fontaine Ridge project in Harare – Kuwadzana high density suburb,” said Nkala.
The Group’s statement of financial position grew by 7 percent to ZWL$ 41.67 billion from the 31 December 2020 position of ZWL39.11 billion. This growth was mainly driven by a 5 percent growth in deposits from ZWL24.71 billion to ZWL 25.92 billion.
The company declared an interim dividend of 29.76 ZWL cents per share for the period taking into account the performance and the need to continue strengthening the Group’s capital position.