ZB Financial Holdings published its results for the half year ended 30 June. Initially, the period was marred with economic challenges including high inflation, weakening local currency, power shortages, and severe drought conditions. However, the introduction of ZiG in the second quarter brought some relative stability, with the rate of local currency depreciation against the USD decelerating during the second quarter. The Group’s organisational transformation program, through which the medium-term strategy to 2025 is being implemented, is now towards its tail end, with most projects under the Program having been completed. As at half year, only 10 of 45 branches were still to be refurbished in the ongoing modernization drive. The Group’s banking operations remained profitable in the period under review and the Banking Cluster continued to work on the project to upgrade its core banking system. However, losses were recorded in the Reinsurance unit, whereas the Life Assurance unit posted a profit. The Group integrated its acquisition of Mashonaland Holdings, with the property portfolio now managed under one entity. At the Group level, a recorded net interest of ZWG209.98mn was 20% ahead of the ZWG174.95mn recorded in the prior comparable period, whereas net expected credit losses declined 75% to ZWG9.21mn due to an improvement in recoveries. This resulted in a 45% uptick in net income from lending activities to ZWG200.77mn. The insurance service result improved 25% to a deficit of ZWG176.41mn, whilst the net financial result registered at ZWG52.26mn from a restated figure of -ZWG727.057mn in 1H23. Fees and commissions saw 28% growth to ZWG353.01mn. Fair value adjustments however fell 95% y/y from ZWG1.86bn in 1H23 to ZWG95.6mn in the current period and consequently, the Group recorded a 41% decrease in total income from ZWG2.18bn in 1H23 to ZWG1.28bn in the period under review. Operating costs increased 16%, largely reflecting the macro level general price increases. Performance was also hampered by a 96% decline in share of associate companies’ profit net of tax. Resultantly, the Group closed with a PAT of ZWG1.06bn, trailing 61% behind the ZWG2.73bn achieved in the prior period. Total assets in the 6 months to June increased 4% in real terms to ZWG9.14bn. The Group did not declare a dividend for the period. All Group companies met the required minimum capital requirements during the period, with the exception of ZB Building Society, although plans are underway to address the shortfall.
