ATLAS Mara’s Zimbabwe unit, BancABC, has posted a profit after tax of $7,6 million for the year to December 31, 2017, from a loss of $1,4 million in 2016 on controlled growth in credit and quality lending.
The group said loans and advances remained constant over the period at $1,1 billion.
“This was coupled with low credit growth in markets such as Mozambique and Tanzania,” said ABC Holdings (ABCH) chairman, Jan Claassen, in a statement accompanying financial results. Deposits remained at $1,6 billion, with the primary focus on changing the deposit mix with a bias towards less expensive transactional deposits.
Non-interest income went down slightly from $78 million in 2016 to $77,2 million during the reporting period.
This was due to a reduction in foreign exchange trading in certain countries, which was mitigated by an increase in fees and commission income by 16,3 percent on the back of improved retail banking performance, the company said.
An impairment charge of $18,6 million for the period was up from $12,6 million in the comparative period.
Although the non-performing loan ratio improved from 13,7 percent to 12,3 percent, there was a deterioration in some loans resulting in additional provisioning.
“While some of our markets experienced strain on certain retail and corporate loans, the group remained confident of its internal collection processes and the strategic focus on writing new quality loans,” Claassen said.
The cumulative total impairment allowance on the statement of financial position was down from $83,3 million in 2016 to $72,9 million during the year to December 31, 2017.
“Total operating expenses marginally increased from $170,3 million for the year to December 31, 2016 to $171,5 million for the full year ended December 31, 2017. As part of the restructuring project of relocating a streamlined staff compliment to Botswana, head office total expenses decreased from $19,2 million for the financial year to December 31, 2016 to $11,4 million for the current year,” Claassen said, adding that the merger of ABC Zambia and FBZ Bank reduced the Zambian unit’s costs by 14 percent. The consolidated ABCH cost to income ratio decreased to 86 percent compared to 94 percent for the comparative period. Cost containment remained a key area of focus for the group, he said.
“All operating subsidiaries were compliant as far as the capital adequacy ratio is concerned and exceeded the minimum regulatory requirements. While the two banks in Zambia, FBZ and ABC Zambia, were compliant on capital for local banks prior to the merger, the new Atlas Mara Zambia bank, as a foreign owned bank, is required to be capitalised to $52 million, against the current capital base of $36,5 million in line with the capital requirements for foreign owned banks. The bank is making progress towards meeting this requirement,” said Claassen. firstname.lastname@example.org