Foreign currency exchange gains and fair value credits prompted significant growth in income for financial services provider, ZB Bank in the half year period (HY) 2020 ended June 30 as the local currency value continued on a nosedive.
The Zimbabwe dollar depreciated 154.98 percent against the American dollar on the official market during the second quarter enough to yield substantial foreign currency exchange gains for the Group.
Total income for second quarter was 548 percent higher (historical) than total revenue earned Q1, the bank said in its latest trading update, a precursor to the financial statements to be published on the 28th of August.
“Income growth is largely anchored on the fair value credits and foreign currency exchange gains, collectively making up 89 percent of total revenue,” the bank said.
However, core business revenue continue to lag behind inflation movements.
Month on month inflation during Q2 averaged 21.48 percent while year on year closed at 737.32 percent.
Deposits increased 107 percent in Q2 compared to full year 2019 while loans and other advances also grew 164 percent during the period compared to full year 2019.
The bulk of these advances and loans (23 percent) were from Letters of Credits.
Aggregated liquidity ratio for the bank was above 80 percent, making the bank stable.
The bank is making inroads into the diaspora market, with its diaspora product at pre-launch stage while the international funeral cash plan awaiting approval from the regulator.
