First Capital Bank Zimbabwe is shifting the composition of its lending towards businesses, with trade and services emerging as the biggest beneficiaries of the bank's expansion in credit during the first half of 2026.

The shift comes as the bank reported a 26 percent increase in profit after tax to US$16.7 million, while its assets expanded by 18 percent to US$390 million and deposits rose by 24 percent to US$248.76 million.

Economist Lethukuthula Khozah described the performance as evidence of continued momentum at the bank.

“First Capital Bank Zimbabwe continues to show strong growth in its half-year results to June 2026. Profit after tax rose 26% to US$16.7m, assets grew 18% to US$390m, deposits increased 24% to US$249m, while loans and advances grew 27% to US$165m,” Khozah said.

“A 36% return on average equity is particularly impressive, alongside an interim dividend of US$0.31 cents per share. Strong numbers from the banking sector,” she added.

But beneath the headline growth is a significant change in where First Capital is putting its money.

The bank added US$36.62 million to its gross loan book between December and June, taking it from US$131.99 million to US$168.62 million.

Trade and services alone absorbed US$23.52 million, or about 64 percent, of that increase.

Its exposure to the sector consequently jumped from US$16.64 million to US$40.17 million, lifting its share of the loan book from 13 percent to 24 percent in just six months.

The change represents a marked departure from the structure of the bank's lending several years ago, when agriculture, industry and transport collectively accounted for a much larger proportion of its credit.

In 2022, agriculture represented 21 percent of First Capital's loan book, light and heavy industry 22 percent, and transport and distribution 17 percent.

By June this year, those shares had fallen to 11 percent, 12 percent and four percent, respectively.

Trade and services moved in the opposite direction, rising from 13 percent of the loan book in 2022 to 24 percent.

The other major change has been in household lending.

Physical-person loans increased from US$72.70 million at the end of 2025 to US$80.18 million by June, but their share of the total loan book fell from 55 percent to 47 percent.

That means the bank is not necessarily reducing household credit in absolute terms. Instead, business lending is growing quickly enough to dilute its previous concentration in lending to individuals.

The change also coincides with a rapid expansion of the bank's funding base.

Customer deposits increased by almost US$49 million during the six months, reaching US$248.76 million from US$200.06 million at December.

Corporate and investment banking demand deposits accounted for much of the increase, rising by more than US$43 million to approximately US$151 million.

The numbers suggest that First Capital is finding increasing opportunities to match its growing corporate deposit base with commercial lending.

But the quality of that expansion will be important as the bank moves deeper into corporate credit.

First Capital's non-performing loans increased in absolute terms from US$6.86 million at December to US$7.52 million by June.

Trade and services accounted for US$2.47 million of the problem loans, while light and heavy industry accounted for US$3.10 million.

Physical persons contributed another US$1.96 million.

The overall non-performing loan ratio nevertheless declined from approximately 5.2 percent to 4.5 percent because the loan book expanded faster than the stock of bad loans.

That distinction is important.

The bank has improved its NPL ratio, but the absolute amount of problem credit has not declined.

Industry presents the clearest concentration of that risk. Light and heavy industry accounts for only 12 percent of the loan book but carries US$3.10 million in non-performing loans, making it the largest contributor to the bank's impaired credit.

Trade and services, meanwhile, has become the bank's largest corporate lending category while carrying US$2.47 million in non-performing loans.

Agriculture presents a different picture. First Capital had US$19.11 million in agricultural loans at June but no reported non-performing loans in the figures supplied.

The bank's lending strategy therefore appears to be moving towards sectors where credit can be deployed relatively quickly, particularly businesses involved in commerce and services.

That is significant in an economy where banks are under pressure to translate rising deposits and liquidity into productive lending.

The shift does not necessarily mean First Capital is abandoning productive sectors. Businesses in trade and services are themselves part of the economic supply chain and can finance inventories, distribution, imports, exports and working capital.

But the composition shows that the strongest immediate demand for credit is coming from commercial activity rather than sectors such as agriculture, manufacturing and transport.

The bank's earnings performance has benefited from the expansion.

Net interest income rose by 15 percent to US$21.71 million, while return on average equity reached 36 percent.

Credit impairment charges also fell sharply, from US$2.90 million to US$355,000 during the period, supporting the growth in profitability.

The combination of higher lending, lower impairment charges and a larger deposit base has produced a strong first-half result.