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CBZ Holdings Limited has reported a 32 percent decline in after-tax-profit to $23,7 million in the full year to December 31, 2016 from $35,2 million in the prior year as the financial services provider experienced pressure on margins given the reduction of interest rates.

In 2015, the Reserve Bank of Zimbabwe (RBZ) ordered banks to lower interest rates that were ranging around 30 percent, to between 6 and 18 percent per annum. The group’s revenue for the period amounted to $158,9 million, a 12,7 percent decline from prior year’s $182,2 million.

CBZ Banking unit contributed the largest portion to group revenue ($118 million). Its deposits rose 5,5 percent to $1,7 billion from $1,6 billion last year.

Non-performing loans (NPLs) were largely flat at 6,6 percent compared to 6,9 percent in the prior comparable period. Advances were unchanged at $1 billion as management maintained a cautious approach to lending.

The group’s building society and insurance businesses contributed $31 million and $9,7 million to revenues, respectively. CBZ Holdings’ total expenditure during the period under review was down 6 percent on the back of management successfully reviewing contracts with its suppliers.

Assets increased to $2,08 billion from $1,97 billion, the majority being Treasury Bills which nearly doubled to $760,5 million from $471,9 million last year.

Earnings per share (EPS) were down to $4,53 from $6,52. And the board declared a dividend of $3,2 million. Going forward, the group expects to benefit from a number of macro-economic developments and Government policy measures.

“It…remains critical for the authorities to follow through on policy pronouncements made in 2016, including the arrears clearance strategy and the accelerated implementation of key reforms under the Rapid Results Initiative, in order to steer the economy towards a sustainable growth path.

“Agricultural output is expected to improve, leading to preservation of foreign currency for other critical imports,” said group chairman Mr Elliot Mugamu. —  BH24