CBZ says not deterred by Covid-19 pandemic

Business Reporter
LISTED financial services group, CBZ Holdings, says the Covid-19 pandemic has not negatively affected the group’s ability to access lines of credit as such funding is demand driven.

Covid-19 pandemic which was first detected in China last December, has spread to the rest of the world thereby adversely impacting on global economies.

In a statement accompanying financial results for the year ended December 31, 2019, CBZ Holdings acknowledged that although the disease, which was detected in Zimbabwe towards the end of March has had some negative repercussions on its operations, the group’s ability to access lines of credit was still firm.

“The Covid 19 pandemic has not yet had any effect on the group’s ability to access competitively priced lines of credit. This is because from the group’s perspective, lines of credit are demand driven and the group only negotiates facilities that have specific sub-borrowers supported by export receivables,” it said.

At present, CBZ Holdings is negotiating for an undisclosed amount of lines of credit with AfreximBank and the negotiations for the facility is about to be closed.

“The group is working on a facility with AfreximBank, which is about to be closed and since the onset of the pandemic, there has been no indication whatsoever that the terms of the facility, particularly pricing will be changed. “In addition, no concerns have been raised regarding disbursement constraints by the financier,” said the bank.

It said most of the lenders, particularly AfreximBank, have put a specific facility in place to address funding constraints occasioned by the Covid-19 pandemic.

CBZ Holdings said presently it has two facilities in place, which are in operation and the financiers have not indicated any intention to review terms and conditions, particularly availability.

“The group has assessed that the pandemic will not have an inhibiting impact on its financial activities and position as most of its services and business activities have been and can be migrated to online platforms.

“Key clients in the mining, agriculture and retail services have been designated essential services and have been able to continue operating thereby mitigating against material impairments to these credit asset lines.”

In this context, CBZ Holdings said it is envisaged to continue as a going concern despite the possible impact of the pandemic.

“The directors have assessed the ability of the group and its subsidiaries to continue operating as a going concern and believe that the preparation of these consolidated financial statements on a going concern basis is still appropriate. As the Covid-19 pandemic continues to spread globally, the group has considered the future impact it might have on its ability to continue operating as a going concern,” said CBZ Holdings.

It noted that global and domestic economic activities are expected to slow-down as governments adopt restrictive measures to curtail the spread of the virus.

In Zimbabwe, the financial services group said, Government and private sector efforts to fight the pandemic will result in new threats and opportunities to the group’s business model.

“The operations of the group in general have however not been spared of the effects of this pandemic. Due to the lockdown that has been necessitated by the need to curtail the spread of the Covid-19 pandemic, most of the group’s branches have either been closed or are not operating at full capacity. Most of the group’s employees are working from home with the exception of staff members that are required to be available physically within the work premises,” said the group. — @okazunga.