Share

Nedbank's Zim unit records profit growth

Harare - Nedbank Group [JSE:NED] has made millions of dollars in lines of credit available to its Zimbabwean subsidiary MBCA Bank Limited, according to a bank official.

In a statement accompanying MBCA’s results for the year to end-December 2015, the bank’s chairperson Willard Zireva said the parent company has furnished the funds to provide commodity finance to Zimbabwean companies.

“In addition to the lending on the MBCA balance sheet, the bank continues to benefit from the major shareholder’s (Nedbank's) technical support as well as a US$75m line of credit to provide commodity finance to Zimbabwe companies,” said Zireva.

Zireva said the bank’s capital as at December 31 2015 was $42.8m and it is on target to meet the regulatory capital level of $100m by December 31 2020 “subject to an improvement in the environment”.

Commenting on the bank’s performance in the period under review, managing director Charity Jinya said profit after tax grew by 8% to $5.835m from $5.380m in 2014.

Jinya said the growth in profitability was largely from net interest income which increased by 10% to $14.753m. Non-interest revenue fell by 7% to $12.792m, primarily due to reduced transactional business from companies and individuals who were adversely impacted by economic activity.

The bank’s balance sheet grew significantly to $243.884m from $188.936m, primarily due to growth in the loan book and treasury bills which grew by 11% and 32% respectively. Loans and advances to customers constituted 42% of the total balance sheet, compared to 49% in 2014.

On the future outlook, Zireva said Zimbabwe’s re-engagement with international financial institutions and successful implementation of structural reforms will unlock opportunities for the country and enable medium- to long-term growth.

“The outlook is, however, clouded by increased power shortages, reduced agriculture earnings due to erratic weather conditions, limited irrigation facilities and low mining earnings due to weak commodity prices,” said Zireva, adding that the situation is exacerbated by increased competition from imports given local infrastructure constraints and unfavourable exchange rate dynamics.

MBCA is in the process of implementing the approved indigenisation plan.

         
We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.94
-0.2%
Rand - Pound
23.90
-0.0%
Rand - Euro
20.44
+0.2%
Rand - Aus dollar
12.34
+0.1%
Rand - Yen
0.13
-0.1%
Platinum
908.75
+1.3%
Palladium
1,014.28
+1.3%
Gold
2,218.96
+1.1%
Silver
24.81
+0.7%
Brent Crude
86.09
-0.2%
Top 40
68,346
+1.0%
All Share
74,536
+0.8%
Resource 10
57,251
+2.8%
Industrial 25
103,936
+0.6%
Financial 15
16,502
-0.1%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders