FBC profit after tax increases by 443%

Audrey Galawu

ASSISTANT EDITOR

FBC Holdings Limited achieved a commendable set of financial results, recording a 443% increase profit after tax increased by to ZWL$327.4 billion.

The Group’s profit before tax, adjusted for inflation, was ZWL$403.5 billion, which represents a 255% increase from ZWL$113.7 billion recorded in the previous year.

This notable performance is attributed to the growth in total income and in part, by cost containment.

Total income for the Group increased by 138% to ZWL$1.3 trillion, up from ZWL$533.0 billion, driven by the growth in all revenue streams, save for insurance and property sales.

The Group’s net interest income increased by 69% to ZWL$239.8 billion, compared to ZWL$142.2 billion in 2022, supported by a 121% growth in loans and advances, which closed the year at ZWL$1.6 trillion.

In its financial report for the year ended December 31, 2024, FBC said its banking subsidiaries experienced a higher demand for foreign-currency-denominated loans in response to increased usage of multiple currencies for local transactions.

“The Zimbabwean economy experienced growth despite the currency instability and high levels of inflation. According to the International Monetary Fund, the country achieved a GDP growth of 5.3% in 2023, driven by the remarkable expansion of the agricultural and mining sectors. Foreign currency inflows and remittances continue to support the growth of domestic trade and services, which are heavily dollarised. Remittances are expected to remain strong and the current account is projected to be in a small surplus.

“Despite the growing disparity between the Zimbabwean Dollar and the United States Dollar in both the official and alternative markets, we believe that increased dollarisation will continue to stabilize the economy. While power outages have continued to have a significant impact on business productivity across all sectors, there was an improvement in power generation capacity in the second half of the year,” reads the report.

Total other income, which includes foreign exchange and investment income, grew by 163%, significantly contributing to the Group’s total revenue, which was mainly derived from the Group’s hedged positions.

Administration expenses increased by 169% to ZWL$955.5 billion from ZWL$354.8 billion reported in the previous year as a result of the re-pricing of overheads in line with exchange rate movements and inflation trends.

Consequently, the Group’s cost-to-income ratio was 75%, compared to 67% in 2022.

FBC’s statement of financial position strengthened to ZWL$3.4 trillion, anchored by a growth in loans and advances.

Shareholders’ funds grew by 141% to ZWL$706 billion, mainly due to increased profitability for the year.