Mishma Chakanyuka, Staff Writer 
ZB Financial Holdings (ZB) says it anticipates the current tight monetary policy, use of gold coins and effective monitoring in the financial sector by the authorities to go a long way towards promoting stability in the economy.
This year, the government introduced a raft of measures as a way of dealing with the exchange rate volatility, which saw the local currency losing more value amid soaring inflation. The measures have managed to stabilise the exchange rate and tame inflation to date.
In a trading update for the third quarter that ended September 30, 2022, group company secretary, Tinashe Masiiwa, said the government maintained interest rates at 200 percent per annum to control the money supply in the economy.
Shepherd Fungura, ZB Holdings CEO
“In addition, the government introduced gold coins on 25 July, 2022 as an alternative stable financial asset for a store of value to support the tight monetary policy stance,” Masiiwa said.
Meanwhile, the group’s inflation adjusted revenue for the nine months to September surged by 97 percent to $51,375 billion on the back of an improvement in both interest and non-interest income. Net interest and trading income for the period increased by 41 percent to $12,406 billion supported by loan book growth and the margin benefit of rising interest rates.
“For the quarter, an average annual interest margin of 35,55 percent was attained, up from Q3FY21’s annual average margin of 26,165 percent. However, the increase reflects only a partial offset against inflation,” Masiiwa said.
Non-interest income rose by 127 percent to ZW$43,031 billion year-on-year mainly composed of insurance premiums, fair value, foreign exchange gains and commissions. Net insurance premium increased by 44 percent during the quarter supported by the underwriting of new business and improvement in risk selection.
Banking commission income grew by 12 percent driven by improving transaction banking volumes. The group’s non-trading income surged by 263 percent, with growth underpinned by a 1 600 percent increase in foreign exchange income driven by the substantial depreciation in the official exchange rates as policymakers attempted to stabilise the market.
Total assets increased by 16 percent to $186,453 billion of which 60 percent were interest-earning assets. The group continues to enhance its involvement in fostering economic growth through lending to the productive sectors of the economy as evidenced by the seven percent loan book growth it witnessed during the period to $41,78 billion.
