ZB confident despite US$3m heist
Zimbabwe Stock Exchange (ZSE)-listed financial services firm, ZB Financial Holdings (ZBH) says it is optimistic that it will meet set targets during the 2021 financial year despite losing US$2,7 million this January to cheeky robbers who hit a cash-in-transit vehicle movie-style.
The robbery occurred along the Harare-Chinhoyi Highway when a ZB vehicle which was transporting cash was intercepted, placing the firm’s ability to secure billions of dollars into question.
But in a first quarter trading update released on Tuesday, ZB said the dramatic raid brought to the fore the risks that confront Zimbabwe’s banks since the country reverted to the multicurrency system last year.
A similar spate of robberies rattled the financial services sector in 2009 when the country dumped the Zimbabwe dollar and switched to the multicurrency system.
“Measures have been taken to improve security and mitigate loss,” company secretary Tinashe Masiiwa said in a commentary to the trading update covering the period January to March 2021.
Masiiwa said the group was confident it would meet the statutory US$30 million minimum capital requirement in Zimbabwe dollars after a merger of its two units, ZB Bank Limited and ZB Building Society by year end.
ZB Bank Limited is required to have a minimum capital of US$25 million, while the building society requires at least US$20 million in capital.
Currently, ZB Bank’s capital stands at $4,1 billion or about US$48,7 million, but the building society is sitting at $784,4 million or US$9,3 million, hence the planned merger.
The group’s biggest headache, however, will be its reinsurance unit which requires at least US$75 million against its current capitalisation of $621 million, about US$7,3 million at the prevailing interbank exchange rate.
In terms of financial performance, group total income slid by 10% compared to the same period last year, to close the reporting period at $1,3 billion.
The group said foreign exchange earnings dominated total income, driven by wide movements in the exchange rate as the central bank attempted to stabilise it.
Net interest and trading income increased by 194% on the back of a 15% growth in the loan book and trading assets.
Gross insurance premiums increased by 7%, while related expenses fell by 11%.
Banking commission increased by 44% following a 12% growth in the number of customer accounts.
However, Masiiwa said there was a 21% slump in aggregate volumes of transactions.
Total assets grew by 11% to $22,9 billion, driven by a 19% growth in deposits and other funding accounts from $7,9 billion at the end of December 2020 to $9,5 billion at the end of March.
ZBH sought an extension with the ZSE for the publication of its full year results to end of May in order to avail time for external audit processes that had been delayed by sub-optimal working arrangements under COVID-19 lockdown rules.
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Irked by the development, Chiwanza was reported to have forced the door open and it…Learn More