Getbucks loan uptake continues to jump
Listed financial services firm GetBucks Micro-finance Bank says its loan book has continued to improve after loans more than doubled between January and May 2021.
Figures from Getbucks show that total loans grew 111 percent to $198 million by end of the period to May 2021 from $93,6 million recorded as at January 2021.
Of the total loans, the consumer sector accounted for the bulk of the bank’s loan book at 68 percent, according to chief executive officer Mr George Nheweyembwa.
“The loan book has continued to grow both qualitatively and quantitatively. The increase in loan book is attributed to the bank’s focus on increasing sales for both consumer and non-consumer loans.
“The loan book quality improved over the period under review as evidenced by a decline in non-performing loans (NPLs),” he said in a trading update for the five months to May 31, 2021.
By the end of the period under review, NPLs ratio was at 1,72 percent.
During the five-month period, total income rose 38 percent to $144 million from $104 million recorded during the same period last year.
At $66 million, net interest income was 266 ahead of the comparable period while non-interest income reduced to $29 million from $64 million.
Interest income was driven by improved lines of funding and an increased base in the loan book.
The group overturned an operating loss of $3 million to operating profit of $11 million during the five months under review.
Profit before tax rose 42 percent to $10 million.
Mr Nheweyembwa however, bemoaned the challenging business environment during the period under review, which he said was characterised by funding constraints.
The period was also negatively impacted by two months of lockdown at the beginning of the year. Resultantly, transactional volumes decreased 5,8 percent over the comparable year ago period.
He said: “While local currency stability has been maintained since the inception of the foreign currency auction last year and the conservative monetary targeting framework being pursued by the central bank, the banking sector continues to face limited supply of funding.
“Inflation has decelerated but costs have started to catch up and this has impacted significantly on operations. Interest rates remain high.”
Total assets grew 16 percent to $519 million from $448 as at December 2020 after the business managed to acquire new funding lines.
Capital adequacy ratio and liquidity ratio was at 69,85 percent and 36,9 percent respectively against a target of 15 percent and 30 percent in that order.
To meet the regulatory capital requirements of US$5 million by December 31, 2021, Mr Nheweyembwa said the bank will pursue an equity transaction, which will include a share placement programme in addition to anticipated organic growth in profits.
The anticipated improved economic performance, with the Government forecasting a GDP growth rate of 7,4 percent on the back of a good agricultural 2020 / 2021 season, should result in an increase in transactions in the economy, which will be an advantage to the financial services provider, the group said.
The group will also continue its focus on the bank’s technology drive which is anticipated to yield increased customers while cost containment and cost reduction will be key in pursuit of earnings enhancement. -herald.cl.zw
