FMBCH anticipates 2023 profit to bulk 28 percent

FMBcapital Holdings (FMBCH), which has banking and finance operations in the region, including Zimbabwe, says it anticipates 2023 profit to register an increase of between 24 percent and 28 percent from the prior year.

FMBCH plc is the Mauritius-based holding company for the FMBcapital Holdings Group (“the Group”), which has banking and finance operations in Botswana, Malawi, Mozambique, Zambia, and Zimbabwe, in addition to technology and operations shared services in Mauritius.

In a trading statement, the group said it is reasonably certain that the financial results for the year ended December 2023 will differ by at least 20 percent from the financial results for the previous corresponding period.

“FMBCH accordingly advises that its forecast profit is attributable to owners of FMBCH for the year ending December 31, 2023 (FY 2023) and will be approximately between US$ 9,6 million and US$ 11,2 million more than the profit attributable to owners of FMBCH reported for the year ended 31 December 2022 (FY 2022).

“This represents an approximate increase of between 24 percent and 28 percent from the previous corresponding period ended December 31, 2022, for which the group reported a profit attributable to owners of the parent of US$ 40,1 million,” it said.

FMBCH further advised that its forecast consolidated profit for the year ending December 31, 2023, will be approximately between US$ 10,8 million and US$ 13,2 million higher than the consolidated profit reported for the year ending December 31, 2022.

“This represents an approximate increase of between 18 percent and 21 percent from the previous corresponding period ended December 31, 2022, for which the Group reported a consolidated profit of US$61,2 million,” reads part of the statement.

The group said the forecast is in US dollar terms and is subject to final out turns, particularly in FMBCH’s Zimbabwe operations.

However, during the period to September 30, 2023, First Capital Bank’s (FCB’s) total income grew by 29 percent on a year-on-year basis to US$48,7 million, which compares to US$37,9 million for the same period in 2022.

This was driven by strong performance in both net interest and non-funded income, which increased by 22 percent and 33 percent, respectively.

“Interest income growth was driven by year-to-date loan growth of 32 percent to US$89 million at Q3 2023, with 12 percent having been funded by offshore lines of credit.”

FCB said the increased usage of the USD on the local market has also been reflected in customer balances, with 85 percent of customer deposits being foreign denominated and foreign currency loans comprising 90 percent of total advances.

The bank said the currency mix on the balance sheet has impacted the income generation pattern for both interest income and transactional fees, with foreign earnings accounting for 70 percent of total income.

Operating expenses increased by 18 percent to US$28,6 million for the nine months ended September 30, 2023, compared to US$24,2 million incurred during the same period in 2022.

The Bank said cost stabilisation remains a critical strategic imperative in the short term to guarantee the sustainability of operations against the backdrop of tightening interest margins.-ebusinessweekly