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Nelson Gahadza
Business Reporter
ZB Financial Holdings (ZBHF) recorded a 394 percent jump in income to $1,247 million in the year to December 2023 underpinned by fair value adjustments, commissions and fees.
Group chief executive Mr Shepherd Fungura said income performance continued to be mainly underpinned by fair value adjustments, which rose by 530 percent from $74,443 billion in 2022 to $468,635 billion in 2023.
He said the out-turn for the year was also supported by a 344 percent improvement in other operating income, from $107,200 billion in 2022 to $452,680 billion, as well as a 287 percent increase in commissions and fees, to $296,036 billion from $76,451 billion in 2022.
The group’s financial results also show that net interest income rose by 95 percent to $187,904 billion in 2023 from 96.144 billion in 2022, while loan impairment charges rose by 73 percent from a negative $32,762 billion in 2022 to a negative $56,627 billion in 2023.
“Resultantly, net income from lending activities rose by 107 percent from $63,382 billion in 2022 to $131,277 billion in 2023,” said Mr Fungura.
For the year under review, the group’s insurance service result fell by 486 percent from a deficit of $26,127 billion in 2022 to a deficit of $153,235 billion in 2023, largely as a result of an increase of 327 percent in insurance service expenses to $377,642 billion from $88,407 billion in 2022.
Mr Fungura said the group’s operating costs grew by 275 percent to $760,111 billion from $202,673 billion in 2022, largely reflecting the macro-level general price increases.
As a result, profit after tax (PAT) for the year improved by 312 percent to $665,383 billion from $161,465 billion achieved in 2022.
According to Mr Fungura, the group’s total assets increased by 124 percent in real terms from $1,501 trillion as of December 31, 2022, to $3,355 trillion for the year under review, and the growth rate outperformed average inflation over the same period.
He said deposits and other related funding account balances grew by 113 percent to $1,120 trillion from $524,796 billion as of December 31, 2022.
Mr Fungura said the group maintained a comfortable liquidity margin of safety, with the average ratio of liquid assets to customer deposits being above 60 percent throughout the year against a prescribed ratio of 30 percent.
In terms of operations, ZB Bank Limited posted a profit after tax of $366,751 billion in 2023, up from $68,464 billion in 2022.
The bank’s total assets stood at $2,168 trillion as of December 31, 2023, up from $911,032 billion in 2022. The group’s building society, ZB Building Society, posted a profit after tax of $60,907 billion in 2023, up from a profit of $21,492 billion in 2022.
Mr Fungura said during the year under review, the banking cluster progressed with the project to upgrade its core banking system, and the project continues into FY2024.
ZB Reinsurance posted a profit after tax of $51,089 billion in 2023, up from $11,462 billion in 2022, and total assets increased in real terms to $182,335 billion from $60,205 billion in 2022.
ZB Life Assurance posted a profit of $98,174 billion in 2023, up from a profit of $5,060 billion in 2022, while total assets increased in real terms to $279,765 billion from $135,421 billion in 2022.
Mr Fungura said the group in 2023 progressively increased its shareholding in Mashonaland Holdings (Mash), from 50,59 percent as of December 31, 2022, to 56,89 percent as of December 31, 2023.
Mr Fungura noted that the group’s organisational transformation programme (OTP) continued to progress in FY2023, with some projects under the programmeme having been finalised while others are at various levels of completion.
He said the new customer-centric business model and organisational design have been fully adopted, with 100 percent staff deployment.
“Meanwhile, digital transformation and cultural transformation continue into FY2024. In FY2023, a further 10 bank branches were repurposed into group-wide customer service centres, serving the whole bouquet of banking, insurance, and investment services under the “OneZB” concept.
“This is over and above the 25 repurposed service centres in FY2022. Dedicated premium service centres established in Harare and Bulawayo are now fully functional,” said Mr Fungura. He noted that the group’s medium-term plan for 2021–2025 embedded the long-term sustainability of operations as a key theme underpinning its strategy.
He said this entails striking a balance between the welfare of the people it serves, the preservation and promotion of the environment (the planet) in which it operates for current and future generations, and the quest for profit and sustained growth.
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