‘Prudence drives NBS’s profitability’

NATIONAL Building Society (NBS) says unprecedented steps taken to respond to challenges in the operating environment had a positive impact on profitability and growth.
In a statement accompanying the building society’s financial statements for the year ended December 31, 2022, NBS chairman Shingai Mutumbwa noted the impact of events in the macro environment on operations.
“The nation was not spared the effects of the Russia-Ukraine war, especially given that the market was just recovering from the impact of the Covid-19 pandemic. The annual rate of inflation, as measured by the blended CPI, increased from 24,9 percent in January 2022 to 105,5 percent in December 2022.
“In June 2022, the authorities took measures to contain the rapid inflation by tightening the monetary policy. Interest rates were increased to a minimum of 200 percent per annual for corporates and 100 percent per annual for individuals.
“Management took unprecedented steps to respond to the challenges in the operating environment that ensued.
“Whilst prudent and difficult decisions had to be made to control costs, the results were positive on the society’s profitability and growth,” Mutumbwa said.
NBS’s inflation adjusted profit increased by 143 percent between FY21 and FY22.

Acting managing director Sifiso Mahlangu said NBS was actively contributing to meeting the country’s housing needs.
“The nation has a housing backlog of approximately 1,3 million units. In 2022, the society contributed toward narrowing that gap by delivering 600 housing units under the Dzivaresekwa housing project.
“In addition, the society achieved the regularisation of a land bank from which it expects to churn out serviced stands and completed housing units in the coming year.
Several other projects are set to deliver additional houses and stands in FY2023,” Mahlangu said.
“We are on a drive that will ensure that our services are made available to all people nationwide.
“Moreover, we are crafting products particularly accessible to the informal sector, which has previously been shunned by traditional financial institutions.
“We have taken heed and are actively attending to the needs of our corporate clients,” Mahlangu said.
“Our financial performance has responded positively to the initiatives that management is pursuing.
“After reporting a 3-19 liquidity ratio below the minimum prescribed threshold of 30 percent in June 2022, the society has since shifted its trajectory, closing the year with a liquidity ratio of 52 percent.
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