Source: NMBZ dumps $12,7m bad loans – DailyNews Live
BUSINESS WRITER 27 March 2017
HARARE – Dual-listed financial services group, NMB Zimbabwe (NMBZ), has
sold off just over $12,7 million of bad loans, almost completing the
disposal of its toxic portfolio.
The group’s chief executive, Benefit Washaya, last week said his
organisation was cleaning its balance sheet to make it attractive to
international financiers.
This comes as the Zimbabwe Stock Exchange-listed financial services group
has recorded a decline in loan and advances to $205,9 million last year
from $243,2 million in 2015 on the back of harsh economic conditions which
resulted in constrained lending. Washaya said NMBZ was targeting a
non-performing ratio of five percent by year end from the current 10,7
percent.
In the half year to June 2016, the group’s NPL ratio came down from 14,9
percent as at June 30, 2015 to 11,1 percent driven by aggressive
collection efforts and bad loans valued at $11,6 million were shelved to
Zamco.
In the full year to December last year, NMBZ profit after tax reduced 7,8
percent to $5 million on the back of “extreme pressure” from limits
placed on interest rate charges and fees.
“The interest caps, controlled transactional and plastic money fees had an
adverse effect on our performance which we had to partly counter through
increased volumes,” Washaya said.
However, the bank’s net interest income was up 10,3 percent from $20,6
million to $22,8 million, while fees and commissions income slumped 27,7
percent to $15,2 million.
At $260,6 million, total deposits were six percent down from $277,2
million recorded prior comparable period, on the back of funding
opportunities. The bank’s liquidity ratio was up to 40,06 percent from
30,04 percent, while operating expenses dropped three percent from $26,9
million to $26,2 million.
Impairment losses on loans and advances declined from $9,5 million in the
previous year to $8,1 million on the back of strict credit underwriting.
The group’s total assets declined by four percent from $333,8 million in
the previous year to $320,9 million on the back of a 15 percent fall in
loan and advances. At $50,2 million, the bank’s capitalisation remained
above the minimum central bank capital requirement of $25 million. Washaya
noted that the London Stock Exchange-listed group’s focus going forward
was going to be on cost optimisation, reduction and rationalisation.
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