Financial services provider, NMBZ Holdings posted a 557 percent income surge during the first three months (Q1) of 2020 as compared to same period prior year as the bank’s digital transformation strategy paid off.
Despite a challenging environment, the group’s flagship, NMB ‘s digital offerings and broadening of market segments were enough to offset major headwinds in the economy.
In its 2020 Q1 trading update, the Group earned ZWL 145.778 million from ZWL 22.204 million realised same time last year.
Profit after tax grew 447 percent to ZWL 33. 397 million during the period.
“Prior to the advent of Covid-19, the Bank had embarked on a digitalisation drive to improve the customer experience, enhancement of service delivery and broadening the customer digital touch points. This strategy has proven to be pivotal in the current operating environment,” the bank said in a statement.
The Group’s financial position and Bank liquidity remained strong.
The bank liquidity ratio as at close of quarter stood at 55.9 percent against statutory minimum of 30 percent.
“Inspite of the challenges posed by the difficult operating environment and the Covid-19 pandemic, the Group remains solvent and the directors are confident of the Group’s ability to continue to operate as a going concern,” it stated.
The group managed to meet the minimum statutory capital requirement of ZWL 25 million by obtaining ZWL 395.4 million as at March 31, 2020.
However, during the period the Central Bank announced a new capital threshold for banking institutions with a tier-1 bank’s minimum capital of the equivalent of USD 30 million in local currency.
But there are fears that the impact of the Covid-19 pandemic is likely to derail most banks plans to achieving the capital requirements.
“The impact of Covid-19 will no doubt affect our capitalisation plans, but the bank remains committed to achieving aTier-1 status,” the Bank said.
Going forward, the bank will have to continue on its digital transformation path and broadening of banking products in order to mitigate the effects of the Covid-19 pandemic which is likely to stiffle the economic growth in the negative.