Breaking News

CBZ projects total income growth of 10%

by Business reporter
27 February 2013 | 3691 Views
CBZH is expecting another good year in F13 with total income growth of 10% and further growth in assets of 19.5% on the back of diversified income and increased credit lines, CEO John Mangudya told an analyst briefing yesterday.

He said the lines of credit will fund SMEs since they are a major contributor to the economy while the quantity as well as the tenor of mortgage finance will also be extended to meet the high demand of customers.

"There is a less concentration on the SMEs… we want to put more resources in this sector which we believe is contributing significantly to this economy and helps create employment," he said.

He however, lamented liquidity constraints and lack of long term funding for industry recapitalisation as the major challenges to sectors like mining which require long term funding.

Mangudya noted that the group recorded a positive performance for the year ended 31 December 2012.

"All the four subsidiary companies of this group are well capitalised," noted Mangudya.

The core capital of the group was at $122.9million against the $27.5million required by regulators of the banks and insurance as at year end. Meanwhile, the total capital for the period under review is at $160.2million.




CBZ Bank recorded $117.9million as core capital surpassing the $25million required by RBZ while CBZ Asset Management had core capital of $1.1million against the $0.5million benchmark set by the central bank.

CBZ Life and CBZ Insurance posted core capital of $2.7million and $1.2million each.

He also told the briefing that the group spent $7million on share buybacks and that shares held under Treasury now constitute that largest shareholding block, followed by Government of Zimbabwe, the Libyan Foreign Bank and NSSA as the top four. He said the intention is to make the share register leaner and the shares held under Treasury will be disposed to a like-minded strategic investor.  

He noted that the firm has done a number of product development and expansion during the course of the year which includes the agreement the group made with Econet concerning EcoCash.

The group also launched several insurance products like the Credit Life Policies.

"We are also launching our Education Development Policies…and we are quite happy about that as we have expanded both the business of the group and the products," he said.

Under regulatory amendments, Mangudya highlighted that the group is compliant with the process of implementing the Basel II. He also added that the firm is compliant with the RBZ MOU signed sometime in January this year.
 
"We have changed our systems to comply with the dictates of the RBZ MOU in regard with the caps that were put on both interest and the bank charges," he added.
 
On the tax and banking act reforms, CBZ is still going through the documents and "will make the necessary recommendation if necessary".
 
"We are happy that during the national budget that was presented by the finance minister they announced that commercial banks are also going to enjoy the tax exemption on income from mortgage financing as building societies."
 
"We are waiting for publication of that instrument so that at least the consumers can continue to enjoy the housing mortgage financing from the banks…We want to expand on that area," said Mangudya.
 
He noted that the group also focused its attention on offshore financing since one of the major problems in this economy is liquidity crunch and the bank has managed to secure new lines of credit amounting to $280 million.
 
"There is liquidity gap…The demand is much more than supply and as a result we've got liquidity gap and credit crunch. In order to mitigate that gap we resorted ourselves to secure a number of credit lines offshore," he added.
 
Mangudya further noted that the firm will also be looking at investments to boost their asset management company.
 
"The whole idea is to ensure that our customers get a fair share of liquidity for their own businesses and not for ourselves," he said.
 
CBZH finance director Never Nyemudzo said there was a "48% increase in profit after tax from $30.3million last year to close at $45million at the end of 2012."
 
He added that there has been a 17% increase in income from $123million to $144million while a 48.8% increase was recorded in underwriting income from $3.2million recorded in the prior year to $4.7million as at 31 December 2012.
 
The non-interest income which is quite significant to the group's operations contributed 32% compared to net interest income which contributed 68%.
 
Transaction charges contributed 53% to the non- interest income.
 
"Going forward this is going to be a game of volume rather than charges increases because we have already entered into an MOU with the RBZ which we intend to be very compliant with," he said.
 
There was a 15.9% increase in assets to $1 223.1million financed by the 24.4% increase in deposits to break the $1bln mark at $1 032.4million.
 
"There was a modest 8.1% increase in advances to close at $854.7million as we build the liquidity base within the group.
 
"Loans and advances in 2011 was 76% but because of the need to build up the liquidity base loans now constitute 70% of total assets," added Nyemudzo..
 
The bank has security valued at $1.150bln which covers net advances 1.35 times up from 1.1 in F11. NPLS reduced from $48million to $41.9million while coverage ratios improved to 0.62 from 0.45 as a result of increased provisions. Off shore funded advances improved to 20% from 15%.
 
Funds under management closed at $111.1million from the previous $88.2million posted in the prior year.
 
Meanwhile, there was a 209.4% increase in assets being insured by the group.
 
Also on the asset mix, Nyemudzo pointed out that cash and cash equivalent were at 15% whilst property plant and equipment remained unchanged at 6%. Investment properties also remained stable at 2%.
 
Under the analysis of sectorial contribution to the group's deposits, most of the deposits were from financial organisations at 27% and "this is where all offshore lines of credit are being recorded."
 
"It increased from 20% last year to 27% and in total that is $280million being $180million on balance sheet and $100million off balance sheet."
 
The other sectors included services at 19%, communication at 6% and agriculture at 3%. Individuals and manufacturing contributed 12% each while distribution contributed 13%.
 
He noted that the magnitude of loans that are being funded by offshore money is 20% a significant improvement from the 15% recorded last year.
 
"So what it means is we will continue to give our customers more time and more space to pay," he said.
 
Under sectorial analysis of advances, Nyemudzo noted that agriculture made the bulk of the advances at 30% followed by distribution at 24%, manufacturing at 17%, services at 12%, consumer finance at 11%.

"SMEs and microfinance at 5% is going to be a major focus area going forward as these are easy to manage advances as we also want to spread the cake to the economy.


CBZ

Source: zfn

Should Miss World Zimbabwe have been dethroned?

Yes
31.18%
No
64.12%
Not sure
4.71%
340

Comments

News Updates

Email:

Latest News

2015 Mat South Agricultural Show set to be a blast

by Staff Reporter | 29 July 2015 | 138 Views

Cecil killer's accomplice granted bail

by AFP | 29 July 2015 | 255 Views

WATCH: Zimbabwe police officer falls from moving vehicle

by Staff reporter | 29 July 2015 | 541 Views

Tanzania to export its rats to Zimbabwe - Video

by CCTV | 29 July 2015 | 626 Views

Man fights monster cobra snake - pictures

by Staff reporter | 29 July 2015 | 1137 Views

Zimbabwe in more trouble with Fifa

by Sports reporter | 29 July 2015 | 1112 Views

Elephant tusk, Zimbabwean dealer jailed in Botswana

by Staff Reporter | 29 July 2015 | 1073 Views

'Mugabe no longer believes Mujuru plotted against him'

by Staff reporter | 29 July 2015 | 2705 Views

Mugabe orders vendors to leave the streets

by Staff reporter | 29 July 2015 | 2796 Views

Dr Mugabe's gracious secret

by Caitlin Kamba | 29 July 2015 | 2940 Views

'He pulled my vagina from his pocket' - ritual victim says

by Staff Reporter | 29 July 2015 | 2749 Views

Dunlop dismisses about 85 employees

by Stephen Jakes | 29 July 2015 | 1432 Views

Haulage trucks should use Hre-Byo highway not Hre-Masvingo - MP

by Thobekile Zhou | 29 July 2015 | 1633 Views

HIV+ teacher gets life imprisonment for raping boy

by Staff Reporter | 29 July 2015 | 1661 Views

Zimbabwe must not lose sleep over dead lion Cecil - Sikhala

by Stephen Jakes | 29 July 2015 | 1639 Views

Grace Mugabe chosen by God says Prophet

by Staff Reporter | 29 July 2015 | 2187 Views

Bev planned her sex gyrating acts in UK

by Staff Reporter | 29 July 2015 | 3046 Views

Hooker murders troublesome client after sex

by Staff Reporter | 29 July 2015 | 2409 Views

Mugabe shares bed with teen son

by Thobekile Zhou | 29 July 2015 | 4139 Views

I killed Cecil - American hunter confess

by Staff Reporter | 29 July 2015 | 3031 Views

Why do Bulawayo students fail to enroll at NUST? Zanu PF MP ask

by Thobekile Zhou | 29 July 2015 | 3104 Views

Broken down cars cause havoc in parliament

by Thobekile Zhou | 29 July 2015 | 2589 Views

Invitation to the King Mzilikazi commemoration 2015

by Ibutho Lenqama | 29 July 2015 | 1955 Views

'Infrasonic weapon' caused TB Joshua church collapse - academic

by TB Joshua Fans UK Blog | 29 July 2015 | 3005 Views

'Obama is a tricky and mischievous politician'

by AP | 29 July 2015 | 3443 Views

Fire burns down home industries

by Staff Reporter | 29 July 2015 | 3319 Views

Mnangagwa in near embarrassment at Grace Mugabe bash

by Staff Reporter | 29 July 2015 | 6559 Views

Another prophet command congregants to be horses

by Staff Reporter | 29 July 2015 | 4346 Views

Once a Zanu, always a Zanu

by Bekezela Maduma Fuzwayo | 29 July 2015 | 3139 Views

Entertainment

Gwanda gospel music extravaganza confirmed

by Staff correspondent in Pretoria South Africa | 29 July 2015 | 1134 Views

Zim music industry dead - Prof Moyo

by Staff Reporter | 29 July 2015 | 2466 Views

Bev causes UK man to soil pants

by Bongani Ndlovu | 28 July 2015 | 6496 Views

Maskandi Mtshengiseni Gcwensa dies

by Stephen Jakes | 28 July 2015 | 4721 Views

Let me be! - Acie Lumumba

by TWZ | 28 July 2015 | 2337 Views

Bev returns home

by Staff reporter | 28 July 2015 | 5949 Views

Rapper Chad and Grammy winner Soko partner on EFT single

by Anashe Press Relations | 27 July 2015 | 2465 Views

All set for Chibuku Neshamwari National Finals in Bulawayo

by Thobekile Zhou | 25 July 2015 | 1770 Views