FINANCIAL services group CBZ Holdings (CBZ) says it will exercise caution in lending to clients despite overwhelming demand for credit on the domestic market.
The country’s biggest bank by assets and deposits attributed demand to the widespread market liquidity crunch that has widened the mismatch between demand and supply.
The shortage of foreign currency has created a huge capital gap in the economy at a time the newly introduced local currency -ZiG is starting to show signs of instability.
Lawrence Nyazema
“We are failing to meet demand. Given that there is a shortage of funding in the market, obviously demand is much bigger than supply, and that’s the reason why, over a period of two months, we brought in US$115 million,” CBZ group chief executive Lawrence Nyazema told The Financial Gazette in an interview recently.
“That is our contribution towards resolving the liquidity crisis that is in the economy. Yes, we have the capacity to bring in more lines of credit, but we do so in a measured way. The reason for that is that we want to make sure that we meet the terms and conditions, especially on the repayment side, despite any headwinds that we may face as an economy.”
CBZ is adopting a cautious approach to ensure that its expansion is sustainable and aligned with its strategic objectives.
Although banks are currently one of the main forces behind the rise of residential real estate in the economy, there has been waning demand for this asset class due to high costs connected with mortgages.
Affordable housing will remain a top priority for the residential market due to growing public and private sector support.
Recently, CBZ Bank secured a US$15 million loan from Shelter Afrique Development Bank (ShafDB) meant for housing development and mortgage origination.
This builds on a partnership that began in 2012 and has seen CBZ Bank secure US$15,8 million in funding from ShafDB for low-cost housing and mortgage financing.
CBZ’s asset management division, Datvest, expects to complete the Northgate housing project located 17 kilometres north of Harare central business district (CBD) in the next 18 months.
The housing project, which spans over 1 000 hectares of land, commenced on the 4th of June this year and is scheduled to be completed by December 5, 2025.
This comes as prospects for the residential segment remain high, underpinned by the firm demand for housing.
CBZ’s loans and advances clocked $2,07 trillion in 2023, registering a 145 percent growth year on year.
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