FCB to internally finance new head office construction

Victoria Falls Stock Exchange (VFEX)-listed First Capital Bank says construction of the new head office in Borrowdale, Harare, will be financed from internal resources as the bank has a rolling cash flow plan.

The bank, which became the first financial institution to list on VFEX, is targeting completing the project within a one-year period.

Managing Director, Tapera Mushoriwa, told the media on the sidelines of the ground-breaking ceremony that the money would be channeled through a phased approach.

“It’s approximately within a year with a capex range of, I think, quite an amount; it’s a double-digit amount in US dollars. This is organic from retained earnings,” he said.

He added; “So, it will be in pieces; it’s not like we have put the whole amount, but we will be setting those amounts. We have got a rolling cash flow plan that we have put in place.”

Mushoriwa said the new head office, which will sit on 50,000 square meters of space, will have office space and be environmentally friendly.

Currently, the bank’s head office is within the CBD. A number of financial institutions and big companies have relocated from Harare’s CBD in order to avoid crowding and traffic, as well as the need for bigger spaces.

Mushoriwa said the modern and environmentally friendly building also presents an opportunity to provide a world-class working environment for its staff, who are instrumental in driving the business.

‘We are firmly digging our roots in Zimbabwe and have confidence in its economic potential. We are committed to leveraging our regional capabilities to realise mutual growth prospects for all our key stakeholders,” he said.

During the half-year period to June 30, 2023, the bank reported a profit after tax of US$4,3 million, which represented a 232 percent rise from the 2022 comparative.

Rising income was supported by a 23 percent growth in net fees and commissions to US$11,5 million, which the group attributed to several initiatives to increase USD transaction services for customers.

The group also expanded to offer vehicle insurance and licensing services to its customers. As a result, net interest income increased by 35 percent to US$11,6 million, while other income declined by 14 percent to US$9 million.

In addition to the EUR12,5 million in foreign lines of credit from the European Investment Bank, FCB secured US$20 million through Afreximbank.

FCB Zimbabwe is part of FMBcapital Holdings PLC, whose other banking operations are in Botswana, Malawi, Mozambique and Zambia.

FMBcapital has a total asset base of over US$1,5 billion and has over 500 000 customers across Africa.-ebusinessweekly