STANBIC Bank’s profit surged by 27% to ZiG1,4 billion for the financial year ending December 31, 2024, driven by aggressive lending growth and a robust rise in net interest income, according to chief executive officer Solomon Nyanhongo.
Nyanhongo said the performance came despite challenging macroeconomic conditions, including a severe drought that ravaged southern Africa, leaving Zimbabwe among the hardest hit.
“The bank achieved an adjusted profit for the year of ZiG1,4 billion, increasing by 27% from the comparative prior year profit of ZiG1,1 billion,” Nyanhongo said.
“The improvement in profit for the year was largely because the 2023 profit for the year included a ZiG1,1 billion loss on the net monetary position.
“In addition, the bank’s net interest income increased spurred by the new lending assets written during the year. The bank ended the year 2024 with a net interest income of ZiG1 billion, increasing from prior period interest income of ZWG954 million by 8%.
“The uplift in net interest income achieved during the period was largely driven by the increase in the bank’s net lending book from ZiG4,2 billion in December 2023 to ZiG8,4 billion following the extensive currency depreciation which was experienced in September 2024 combined with the new lending assets written during the year,” the Stanbic CEO said.
However, Nyanhongo noted that the impact of this growth was somewhat tempered by lower lending rates, which were revised downward from 200% in January 2023 to 35% during the review period.
Stanbic’s non-funded income declined by 31%, falling from ZiG3,6 billion in 2023 to ZiG2,5 billion in 2024.
- Stanbic bankrolls hockey qualifiers
- Stanbic profits surge on back of forex loans
- Stanbic donates solar-powered borehole
- Stanbic targets diaspora property investment
Keep Reading
The drop was attributed to fair value losses on investment property and reduced unrealised exchange gains, as the ZiG stabilised against the US dollar through the third quarter of the year.
“The bank ended the year 2024 with credit impairments of ZiG39,5 million, increasing from a net release of ZiG111 million in the prior year,” Nyanhongo said.
“The once-off release of allowance for expected credit losses in 2023 was attributable to the improvement in the quality of our lending book following the February 2023 interest rate reduction from 200% to 150% which enabled customers to settle outstanding loan arrears. “In addition, new lending assets were written during the year, resulting in an uplift in allowance for expected credit losses.
“The bank’s total operating expenses of ZiG1,6 billion increased by 21% from ZiG1,3 billion in the comparative period underpinned by the impact of the 80% currency depreciation, which happened in September 2024.
“This resulted in the undesired increase in the local currency equivalents of the bank’s foreign currency denominated expenses,” he noted.
l Exchange rate as at December 31, 2024: US$1:ZiG25,8
