eBusiness Weekly
Enacy Mapakame
Financial services group, ZB Financial Holdings (ZBFH), is targeting to meet its performance targets for financial year 2022.
One of the key focus areas the group is looking at include digital transformation, which should be completed during the fourth quarter of the year, as the bank further enhances its digital footprint in line with obtaining trends the world over.
According to group company secretary, Tinashe Masiiwa, the projections are based on the group’s performance in the past three quarters of the financial year.
Despite a challenging operating environment, ZBFH recorded a 97 percent growth in revenue for the nine months to September 30, 2022 compared to same period last year on the back of improvements in interest and non-interest income.
Net interest and trading income rose 41 percent to $12,406 billon year on year supported by loan book growth and the margin benefit of rising interest rates.
During the quarter, an average annual interest margin of 35,55 percent was attained compared to the same quarter in the prior year, which was at 26,16 percent.
“However, the increase reflects only a partial offset against inflation,” said Masiiwa.
Non-interest income surged by 127 percent to $43 billion year on year and was mainly composed of insurance premiums, fair value, foreign exchange gains and commissions.
Net insurance premium rose 44 percent during the quarter compared to the same period in the prior year supported by the underwriting of new business and improvement in risk selection.
Masiiwa said banking commission income rose 12 percent on the back of improved transaction banking volumes. Non-trading income increased by 263 percent and the growth was underpinned by 1 600 percent increase in foreign exchange income driven by the substantial depreciation in the official exchange rate.
“However, there is a 25 percent reduction in fair value credits for Q3FY22 from $5,2 billion posted in Q3FY21 as listed equities experienced a bearish movement during the Q3FY22,” said Masiiwa.
Deposits and other funding accounts increased by 24 percent to $77,7 billion from $62,8 billion with growth in both retail and wholesale funds. The group equity rose 24 percent during the third quarter to $$79,7 billion.
In terms of prescribed capital levels, the group’s entities were all in compliance with regulatory requirements with the exception of ZB Building Society.
Mr Masiiwa said: “The group believes that the Building Society’s compliance will be addressed positively by December 31, 2022. There are strategic options under consideration to resolve the matter.”
