NMB.zw | HY2016 financial results

By Published On: August 25th, 2016Categories: Corporate announcement, Earnings

Introduction

The difficult operating environment, evident throughout 2015, persisted in the first half of 2016. This was characterised by nostro funding challenges, liquidity constraints, deflationary pressures, depressed levels of capacity utilisation in the productive sector and company closures. This prompted the Central Bank and the banks to introduce cash withdrawal limits and prioritisation of imports. In this environment, the Group recorded an attributable profit of US$2 640 274 for the period under review which was a 17% decrease from the attributable profit of US$3 166 684 recorded in the comparable period.

Key highlights as at 30 June 2016 which are notable in this challenging environment are:

  • – The bank’s shareholder’s funds stood at $52.3 million
  • – Capital adequacy ratio of 20.8% against RBZ’s minimum requirement of 12%
  • – Liquidity ratio of 32.5% versus RBZ’s minimum requirement of 30%
  • – NPL ratio came down from 14.9% at 30 June 2015 to 11.1%

Financial performance

The profit before taxation was US$3 558 801 during the period under review and this gave rise to an attributable profit of
US$2 640 274 which translated to an earnings per share of 0.69 cents (2015 – 0.82 cents).

Dividend

In view of the need to retain cash in the business and to strengthen the statutory capital requirements for the banking subsidiary, the Board has proposed not to declare a dividend.

Directorate

Mr Jonathan Chenevix – Trench resigned as a director of NMBZ Holdings Limited and NMB Bank Limited with effect from 21 March 2016. Mr Khalid Qurashi and Ms Maureen R Svova resigned from both the boards of NMBZ Holdings Limited and NMB Bank Limited with effect from the 20th of May 2016. Mr James de la Fargue was appointed to both boards of NMBZ Holdings Limited and NMB Bank Limited with effect from the 4th of May 2016. I would like to thank the three former board members for their invaluable contributions to both NMBZ Holdings Limited and NMB Bank Limited during their tenure and welcome and wish Mr James de la Fargue a fruitful tenure on the Board.

Outlook and strategy

The banking subsidiary continued to make inroads into the broader market segments thereby laying a foundation for a strategic shift towards small to medium sized enterprises.

The Group continued to source more international lines of credit and is in the process of drawing down a US$20 million credit line and finalising the legal documentation for an approved further US$15 million facility.

In view of the downward pressures on revenues and the continued deteriorating operating environment, cost reductions and containment will be a strategic imperative.

Appreciation

I would like to pay tribute to our valued clients, shareholders and regulatory authorities for their continued support in the period under review. My appreciation goes to my fellow board members, management and staff for their unwavering commitment and dedication which has made the achievement of these results possible in the face of a deteriorating operating environment.

B. A. CHIKWANHA
CHAIRMAN


Related download
NMB.zw | 2016 Interim financial results

NMBZ Holdings Limited (NMB.zw)

Share price: 1,700.00 ZWL cents (0.00 | 0.00% – 11/08/22)

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