First Capital Bank’s loans surge 30 percent
LISTED First Capital Bank loans to customers increased by 30 percent to close at US$86,1 million in the period ended December 31, 2023 with 92 percent of business having been underwritten in United States dollars. In the same period the financial institution posted a consolidated adjusted profit after tax of US$15,4m.
This was supported by a 33 percent increase in total income over the period from US$53,4m in 2022 to US$71,2m for the year ended December 31, 2023. The Bank switched to the United States Dollar (USD) as its functional and reporting currency as of January 1st, 2023 following its listing on the Victoria Falls Stock Exchange (VFEX).
Chief executive officer Mr Tapera Mushoriwa said the Bank’s total deposits turned out at US$123,2m on December 31, 2023 which is nine percent lower than US$136,1m as of December 31, 2022. The reduction was largely driven by the loss of value on ZWL denominated deposits following a 788 percent depreciation of the ZWL over the period. Local currency deposits constituted 13 percent of total deposits at December 31, 2023 compared to 22 percent at December 31, 2022.
United States Dollar denominated deposits increased by six percent during the period under review. “ Loans to customers increased by 30 percent over the same period to close at US$86,1m compared to US$65,9m as of December 31, 2022, with 92 percent of business having been underwritten in USD as at December 31, 2023,” said Mr Mushoriwa.
He said the bank posted a consolidated adjusted profit after tax of US$15,4m for the year 2023 supported by a 33 percent increase in total income over the period from USD53,4m in 2022 to US$71,2m for the year ended December 31, 2023. “This growth was driven by an improvement in the underlying business, driven by growth of the customer base, increase in loans and advances and an increasing proportion of US$ transactions. “Active management of the currency positions also resulted in exchange gains.”
In the period under review, operating expenses increased by 55 percent from US$30m in 2022 to US$46,7m in the year under review. This resulted in the cost to income ratio moving from 56 percent in 2022 to 66 percent in 2023. Mr Mushoriwa said the financial institution continues to actively pursue cost optimisation strategies to manage the overall cost base.
The Bank’s core capital increased by three percent from US$50,9m to US$52,5m as at December 31, 2023. The level is above the regulatory minimum of US$30m.The Bank’s capital adequacy ratio remained strong, closing the period at 28 percent which is well above the regulatory minimum of 12 percent.
“With a liquid assets ratio of 52 percent, the Bank carried a comfortable buffer above the regulatory minimum of 30 percent representing capacity to underwrite more business.”-chroncile
