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SA banks still profitable in Zim

Harare - Stanbic Bank, the Zimbabwe-based unit of Standard Bank Group [JSE:SBK], has remained profitable despite the challenging economic and banking environment it operates from.

In its half-year to June 30 2013, Stanbic Bank recorded a 22.81% growth in net profit after tax to US$8m from $6m prior year comparative.

The profits were made in an environment where the country’s central bank, the Reserve Bank of Zimbabwe (RBZ), does not have funds to perform its lender of last resort functions. 

The sector is also characterised by high non-performing loans, with some banks recording NPLs as high as 22%.

Zimbabwe-based banks have signed a memorandum of understanding (MoU) with the RBZ, which among other measures prohibits banks from charging fees on accounts below $800. The MoU also puts a cap on lending interest rates.

In a statement accompanying the results, Stanbic Bank chairperson Sternford Moyo said fee and commission income grew by a marginal 1% because of the reduction in bank charges following the implementation of the MoU.

He added that the situation was compounded by the depressed level of economic activity in the first half of the year.

Another South African-owned bank, MBCA, owned by Nedbank Group [JSE:NED], was also profitable with a $2.1m profit recorded.

 - Fin24

 
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