Fidelity Life Assurance of Zimbabwe Limited (FIDL.zw) HY2019 Interim Report

We have extracted the Chairman’s Statement from the 2019 half year report for Fidelity Life Assurance of Zimbabwe Limited (FIDL.zw), listed on the Zimbabwe Stock Exchange:

It is my pleasure to present to you the condensed consolidated results of Fidelity Life Assurance of Zimbabwe Limited Group for the half year ended 30 June 2019.

Economic landscape

The announcement of the policy reforms in the fourth quarter of 2018 saw an increased volatility surfacing on various economic fronts. This was fuelled by panic responses to the markets’ interpretation of the announced separation of the Nostro Foreign Currency Accounts (FCA) from Real Time Gross Settlement balances (RTGS) as well as the introduction of the intermediated money transfer tax. Subsequently in February 2019, the Reserve Bank of Zimbabwe pronounced a Monetary Policy statement which then created RTGS dollars as the transacting currency for Zimbabwe effective 22 February 2019 and established an interbank foreign exchange rate. This was followed by the issuance of two
Statutory Instruments:

  • SI 32 of 2019 – Exchange Control Act (Amendment) Regulations, 2019 no.6 and
  • SI 33 of 2019 – Presidential Powers (Temporary Measures);-Amendment of Reserve Bank of Zimbabwe Act and Issue of RTGS Dollars Regulations, 2019.

As a result, the operating environment for this reporting period has remained challenging and has seen foreign currency shortages as well as increased volatility in an upward trajectory of interbank foreign exchange rates since the announcement of Statutory Instrument 142 of 2019. Inflation rapidly increased in the second quarter due to sharp depreciation of the local currency.