FBC Holdings posts US$6,9 million profit

Mushayavanhu said total income came in at US$31,6 million, reflecting a 30 percent jump thanks to increased economic activity and an increase in the customer base.
Mr Mushayavanhu, however, said despite fees and commissions registering 27 percent growth their contribution to group total income remained unchanged from same period last year at 36 percent.
He said the unchanged contribution to total income from fees and commissions was due to the fact that other revenue streams had registered significant growth, increasing their share in total income.
“The increase in net fee and commission income was mainly due to the increased number of transactions by our customers,” he said.
FBC’s net earned insurance premium increased by 47 percent to US$2,5 million, which contributed 8 percent to the total group income.
The company attributed this to marked growth, which was driven by increased customer acquisitions by its divisions Eagle Insurance and FBC Reinsurance.
The group also reported that its cost to income ratio improved to 71 percent from 74 percent compared to the similar period last year as a result of improved cost management.
However, overhead expenses increased by 29 percent over the prior year due to a marketing campaign that the group embarked on during the period to boost its customer base.
FBC also reported that its statement of financial position grew by 24 percent to US$346 million as it boosted deposits and other customer acquisitions.
The bank has since indicated measures it is undertaking to meet the new Reserve Bank of Zimbabwe minimum capital requirements.
These include merging the bank with the building society into a commercial bank.
“This will immediately boost the bank’s capital level to US$46 million by merging FBC Bank and FBC Building Society’s current capital levels of US$30 million and US$16 million respectively,” said Mr Mushayavanhu.
The bank also expects a further US$6 million to be recapitalised in the second half of the year through trading profits, resulting in a total capital of US$52 million by the end of the year. The group has also said that its insurance subsidiaries can achieve any new capital thresholds from normal trading alone following indications by the Commissioner of Insurance an intention to review the minimum capital requirements for insurance and reinsurance companies.    
Meanwhile, the group said in view of the new minimum regulatory capital requirements by the RBZ, the company’s board has decided not to declare a dividend until the new capital levels have been achieved.