admin
Nelson Gahadza
Senior Business Reporter
South Africa’s Nedbank Group says Zimbabwe remains one of its key markets, as the Southern African country’s economy continues to show signs of strong growth, primarily driven by mining, agriculture, and agri-food value chains.
Group chief executive, Mike Brown, speaking during a meeting with Nedbank Zimbabwe’s clients in Harare yesterday, said the group maintains its positive short- to medium-term prospects for Zimbabwe and hence will continue to support key sectors of the economy.
“Nedbank Zimbabwe is a key and important part of our business, having transitioned from the MBCA to the Nedbank brand five or six years ago, and the business continues to perform well notwithstanding the operating environment.
“Zimbabwe economy, we believe growth is primarily going to be driven by the minerals and mining sector through minerals such as lithium, platinum group metals (PGMs), and the traditional gold sector.
“There is also domestic growth in agriculture and the agri-food chain, as well as tourism, so we think those will be the (key) sectors for the economy in the short to medium term,” he said.
The Nedbank Group is one of Africa’s leading financial services firms, with assets worth over US$67 billion. The group operates in Zimbabwe through Nedbank Zimbabwe and has operations across the Southern Africa Development Community and East Africa.
In its financial performance update for the six months to June 30, 2023, the group said the Zimbabwe business continued to perform well and is an integral part of its portfolio.
Mr Brown said the group is also playing a key role in regional energy security and the transition to clean, renewable energy.
“The supporting trend is underway in all the countries that we operate in, and Nedbank is well positioned to support the environment. We are the leaders in renewable energy finance in South Africa, and we hope to be able to take that expertise and knowledge and bring it out onto the continent,” he said.
According to Mr Brown, the group has invested R10 billion in a new technology system and is going to link all group subsidiaries in Southern and East Africa on the same technology, thereby giving group clients an unrivalled digital experience.
He said the bank was in good shape despite difficulties in the operating environment across all markets, such as inflation, interest rates, and the Ukraine war.
On Nedbank Zimbabwe, Mr Brown said the local bank is one of the most capitalised and liquid banks and managed to produce solid performance during the interim 2023 period despite the environment.
Dr Terence Sibiya, Nedbank Group managing executive, Nedbank Africa Regions, said Zimbabwe was an integral market of the Nedbank Africa Regions (NAR) cluster.
The NAR business has operations in Eswatini, Lesotho, Mozambique, Namibia, and Zimbabwe, as well as representative offices in Ghana and Kenya.
“The importance of Zimbabwe as regional head means it remains a strong market in the region. We will support sectors that are growing, and we are also able to lend in hard currency and use our strength in energy financing as we go through the energy transition,” he said.
He said Nedbank Zimbabwe’s focus has been supporting sectors that are driving the Zimbabwean economy.
According to recent half-year financials, Nedbank Zimbabwe had a core capital of US$40,97 million, up from US$8 million in 2020, spurred by significant growth in retained earnings.
The bank’s core capital level was ahead of the regulatory minimum capital requirement of US$30 by the central bank.
The banks’ net interest income and non-interest income grew 205 percent and 281 percent, respectively, from normal trading activities excluding the revaluation of foreign currency balances.
The bank said it had sound liquidity, with a liquidity ratio of 105 percent as of June 30, 2023, well above the prudential minimum of 30 percent.
For the period under review, the bank declared an interim dividend payout of US$2 million to be paid out.
Online Reporter