via CBZ secures $46m line of credit | The Herald August 7, 2015
CBZ Holdings has secured a $46 million line of credit of which $10 million will be used to capacitate the small and medium-sized enterprises sector which has become the launch pad for the country’s economic development.
CBZ Holdings chief executive Mr Never Nyemudzo told a media and analysts briefing that the group will continue to review lines of credit with a view to focus on reducing risk for money which is coming into the country.
“I’m happy at this moment to announce that we have recently concluded a $46 million line of credit of which $10 million is going to be used to re-capacitate the SME (small and medium-sized enterprises) sector so as to compliment Government effort,” said Mr Nyemudzo.
Zimbabwe’s economy has transitioned from being controlled by conglomerates of yesteryear and is now dominated by the SMEs sector.
Officially opening the Small and Medium Enterprises and Co-operative Development Expo recently, President Mugabe said the sector plays a pivotal role in the economic development of the country.
He said according to the International Finance Corporation of 2012, there are more than 125 million SMEs globally while locally the sector employs more than 60 percent of the country’s workforce and contributes over 50 percent to the country’s GDP.
The CBZ group recorded growth in after tax profit to $13,7 million in the half year to June compared to $12,8 million in the comparative period last year. In the six months to June the group recorded a 19,7 percent growth in deposits to $1,7 billion.
In 2009 CBZ had deposits of $357 million to the current $1,7 billion representing a 374 percent growth since dollarisation. Total comprehensive income topped $13,7 million compared to $12,8 million registered in the comparative period last year.
The group benefited from non-banking services and transaction volumes by over 14 percent since the start of the year. Diversification remains a key focus for the group targeting about 20 percent contribution from non-banking units.
“Therefore we will continue to enhance the synergies within the group but focusing on those with a positive multiplier effect. Looking at the current profit 17 percent is coming from the non-banking units up from 3 percent in 2009 with CBZ Life, our long term insurance leading the non-banking units,” said Mr Nyemudzo.
The group will continue with the roll-out for low cost housing stock and Mr Nyemudzo said focus will be given to low cost housing with a number of projects in the pipeline.
“The Nehosho project in Gweru is moving very well with over 200 houses having been completed. The sale of our stands in Chikanga is doing well and we are now embarking on a project in Kwekwe which we are starting very soon.
“We are also in discussion with Bulawayo City Council in order to improve and increase our low cost housing stock,” said Mr Nyemudzo.
All the group’s SBUs remain well capitalised with the bank sitting on $188 million compared to the $45 million required by the regulators, the asset management at $2,4 million compared to the $500 000 required, CBZ Life at $11,2 million compared to $2 million required and CBZ Insurance at $3,6 million compared to $1,5 million.