CABS clocks $24m earnings

Prosper Ndlovu Business Editor
BANKING group, CABS’ net surplus earnings jumped 32 percent to $24,03 million in the year ended December 31, 2014 compared to $18 million realised in 2013. The society delivered a strong growth, which saw net interest income increasing by 32 percent to $42,3 million from $32,6 million in the previous year.

Non-interest income grew 51 percent spurred by the increase in the number of transactions passing through the society’s various delivery channels.

Comparatively, operating expenses increased by 37 percent to $51,4 million compared to $37,5 million.

The bank attributed the trend to the impact of business growth and transformation of operations.

CABS board chair Leonard Tsumba said in a statement accompanying the banks audited financials for the year ended December 31, 2014 issued yesterday, that the society’s cost to income ratio decreased from 64 percent in 2013 to 63 percent last year.

Total assets, meanwhile, grew 37 percent from $623,3 million in 2013 to $852,3 million in 2014, he said.

“This was driven by deposit growth of 41 percent during the same period. Total loans and advances increased by 38 percent from $322,31 million… to $443,53 million,” Tsumba said.

The bank managed to remain afloat with prudential liquidity ratio of 36,4 percent, against the minimum regulatory ratio of 30 percent – despite prevailing liquidity constraints.

Inflation closed year 2014 at –0.8 percent, reflecting the dampening of inflationary pressures on the backdrop of cheap imports mainly from South Africa and limited access to lines of credit by key productive sectors of the economy.

Banking sector deposits closed the year at $5,1 billion with liquidity challenges persisting through 2014.

However, CABS managed to record a number of milestones such as rebranding and refreshing its logo, branch refurbishments, introducing 20-year housing mortgage loans, mobile banking platforms and deploying more ATMs.

The bank managed to mobilise $10 million from Proparco and $25 million from PTA Bank and was voted the best performing bank in 2014 by independent Banks and Banking Survey.

Tsumba said CABS would continue pursuing several growth initiatives to enhance its role in both housing finance and banking.

CABS is a wholly owned subsidiary of Old Mutual Zimbabwe Limited, a company with interests in insurance, asset management, banking, unit trust and property management.

The ultimate holding company is Old Mutual PLC, a company incorporated and registered in the United Kingdom.