Inflation Adjusted Financial Highlights
Total assets | Total capital and reserves | Net profit after tax | ||
13% | 20% | 165% | ||
30 Jun 2022 | 30 Jun 2022 | 30 Jun 2022 | ||
ZW$124,811bn | ZW$44,062bn | ZW$6,069bn | ||
31 Dec 2021 | 31 Dec 2021 | 30 Jun 2021 | ||
ZW$110,538bn | ZW$44,062bn | ZW$2,287bn |
Return on equity | Liquidity ratio | Cost to income ratio | ||
12pps | 23pps | 24pps | ||
30 Jun 2022 | 30 Jun 2022 | 30 Jun 2022 | ||
25% | 84% | 45% | ||
31 Dec 2021 | 31 Dec 2021 | 31 Dec 2021 | ||
13% | 62% | 69% |
pps - percentage points
CHAIRMAN'S STATEMENT
Operating Environment:
For the half year to 30 June 2022, the major issues in the domestic operating environment continued to be instability in the exchange rate regime and worsening inflation profile. The local currency depreciated by 237.1% against the USD from US$1: ZW$108.67 on 1 January 2022 to US$1: ZW$366.27 on 30 June 2022 - the local currency depreciated the most in Q2 2022, by 157.2%, from US$1: ZW$142.42.
Meanwhile, year on year inflation averaged 103.2%, whilst month on month inflation averaged 14.3%, between January 2022 and June 2022. Although the annual inflation outturn for the half year to 30 June 2022 improved from the comparative period in 2021, it is worth noting that, where in the same period in prior year annual inflation was on a downward trajectory, in 2022 year on year inflation is actually on an upward trajectory, and monthly inflation is now in double digit. Aside from the currency depreciation, the worsening inflation profile was also impacted by the pass-through effects from rising global inflation occasioned by the Russia-Ukraine war, which resulted in rising international commodity prices.
A great improvement was recorded in COVID-19 cases during the period under review, with the worst of the pandemic seemingly being behind us now. Business operations were conducted at near full capacity, as the economy continues to recover from outbreak of the Corona virus.
Group Performance:
For the six months ending 30 June 2022 the Group posted inflation adjusted net earnings after taxation of ZW$6.069bn, an increase of 165% over the prior year comparative period whilst in historical cost terms the net earnings after taxation increased by 2 001% to ZW$20.370bn. This performance was underpinned by growth in inflation adjusted total assets of 13% to ZW$124.811bn (31 December 2021: ZW$110.538bn) and in historical cost terms total assets grew by 135% to ZW$116.961bn (31 December 2021: ZW$49.850bn). The financial performance is discussed in greater detail by the Group Chief Executive in his report.
Capital Requirements:
As at 30 June 2022, all Group companies, with the exception of ZB Building Society, were in compliance with prescribed minimum capital requirements. The Group is finalising on options available to address the capital adequacy challenges at ZB Building Society, which are expected to be completed by 31 December 2022.
Dividends:
The Board has declared an interim dividend of ZW77.18 cents per share for the period ending 30 June 2022. A separate dividend notice will be published to this effect.
Compliance & Regulatory Issues:
The Group has dealt with the majority of the governance issues which were the subject of a Corrective Order issued by the Reserve Bank of Zimbabwe (RBZ) on 7 March, 2017 and reviewed in March 2018. The Group has made its submissions to RBZ and it awaits the lifting of the order upon satisfactory review.
Directorate:
Mrs. E. N. Mungoni was appointed as Group Finance Director with effect from 1 January 2022. I wish her success in this new role.
Outlook:
The domestic economy is projected to maintain the growth momentum in 2022 and beyond. The Government of Zimbabwe has projected 2022 GDP growth of 4.6%. Growth is expected to be underpinned by higher output in the accommodation and food services (tourism), mining, manufacturing, and construction sectors of the economy.
The Group's strategic priority for the remaining months of 2022 is to continuously seek ways to preserve its capital from inflation-induced value erosion. In addition, a significant focus will be targeted at completing the sprints of the Organizational Transformation Programme with the goal of making happy customers through the provision of service excellence; and also enhancing group performance outturn.
Conclusion:
I wish to extend my appreciation to all our valued stakeholders, for the continued support to the ZBFH Group. I would also like to express my gratitude to the Board, Management and Staff, for their collective contributions to the notable performance despite a challenging operating environment.
- Chiromo Chairman
30 August, 2022
GROUP CHIEF EXECUTIVE'S REPORT
Introduction:
The Group's primary financial statements are adjusted for inflation in terms of International Accounting Standards (IAS) 29 - Financial Reporting in Hyperinflationary Economies.
Historical cost financial statements have been issued for information purposes only.
Performance Outturn:
For the half year to June 2022, the Group recorded a 147% rise in inflation adjusted total income, from ZW$8.446bn in 2021 to ZW$20.877bn and a 779% increase to ZW$25.725bn in historical cost terms. This performance outturn was mainly underpinned by a 1 039% rise in other operating income, which rose from ZW$0.979bn (Historical cost of ZW$0.326bn) in June 2021 to ZW$11.148bn (Historical cost of ZW$10.913bn) in June 2022, followed by banking commissions and fees which rose from ZW$3.353bn (Historical cost of ZW$1.080bn) in June 2021 to ZW$3.885bn in 2022 (Historical cost of ZW$2.603bn), representing a 16% improvement. Fair value adjustments also contributed significantly, rising by 99% from ZW$1.513bn (Historical cost of ZW$0.696bn) in June 2021 to ZW$3.012bn (Historical cost of ZW$10.994bn) in June 2022.
In inflation adjusted terms, net interest income registered rose by 55%, from ZW$2.649bn in 2021 to ZW$4.106bn in 2022 whilst it went up by 179% to ZW$2.368bn in historical cost terms. Inflation adjusted loan impairment charges rose by 207%, from ZW$0.747bn (Historical cost of ZW$0.249bn) in June 2021 to ZW$2.290bn (Historical cost of ZW$1.761bn) in June 2022. Inflation adjusted net income from lending activities fell by 5%, from ZW$1.902bn in June 2021 to ZW$1.817bn in June 2022. However, historical net income from lending activities arose by 1% to ZW$0.607bn.
Net insurance income increased by 45%, from ZW$0.698bn (Historical cost of ZW$0.223bn) in June 2021 to ZW$1.016bn (Historical cost of ZW$0.608bn) in June 2022, on the back of a 43% rise in gross premiums from ZW$2.044bn in June 2021 to ZW$2.933bn in June 2022 whilst it improved by 215% to ZW$2.075bn in historical cost terms.
Meanwhile, the Group recorded a 58% increase in inflation adjusted operating costs, from ZW$5.970bn in June 2021 to ZW$9.413bn in June 2022, largely emanating from upward pressure on cost structures resulting from the inflationary environment. Historical operating costs increased by 241% from ZW$1.867bn in June 2021 to ZW$6.374bn in June 2022.
Profit from ordinary activities grew by 363%, from ZW$2.475bn (Historical cost of ZW$1.060bn) in June 2021 to ZW$11.465bn (Historical cost of ZW$19.350bn in June 2022).
In inflation adjusted terms, net profit registered a 165% increase, from ZW$2.287bn attained in June 2021 to ZW$6.069bn in June 2022 and a 2 001% growth to ZW$20.370bn in historical cost terms.
Meanwhile, the Group's total assets increased by 13% in inflation adjusted terms, from ZW$110.538bn as at 31 December 2021 to ZW$124.811bn as at 30 June 2022. In historical cost terms, total assets grew by 135%, from ZW$49.850bn as at 31 December 2021 to ZW$116.961bn as at 30 June 2022
Deposits and other related funding account balances grew marginally from ZW$43.060bn as at 31 December 2021 to ZW$43.106bn as at 30 June 2022, whereas in historical cost terms, deposits and other accounts improved by 119% to ZW$43.106bn.
The Group's inflation adjusted total equity increased by 20%, from ZW$44.062bn (Historical cost of ZW$19.488bn) as at 31 December 2021 to ZW$52.776bn (Historical cost of ZW$46.599bn) as at 30 June 2022, underpinned by the positive performance outturn for the period, as well as gains on the revaluation of properties and equipment.
Operations Review:
Banking Operations:
ZB Bank Limited's inflation adjusted net profit after tax improved from ZW$1.474bn in 2021 to ZW$5.148bn for the period ending 30 June 2022 and it registered an improvement of 2 110% to ZW$12.973bn in historical cost terms. The Bank's total assets increased from ZW$81.062bn as at 31 December 2021 to ZW$91.331bn as at 30 June 2022, representing a 12.7% increase. The Bank's asset base in historical terms grew by 128% to ZW$83.827bn as at 30 June 2022.
ZB Building Society's inflation adjusted net profit after tax improved from ZW$191.76m in June 2021 to ZW$1.037bn for the period ending 30 June 2022 and an increase of 3 282% in historical cost terms. The Society's total assets increased from ZW$6.427bn (Historical cost of ZW$2.935bn) as at 31 December 2021 to ZW$7.492bn (Historical cost of ZW$7.444bn) as at 30 June 2022, representing a 17% increase.
Insurance Operations:
ZB Reinsurance's net profit after tax in inflation adjusted term, improved from ZW$277.56m in 2021 to ZW$990.70m for the period ending 30 June 2022 and it recorded a historical cost improvement of 2 514% to ZW$2.442bn. The company's total assets increased from ZW$4.073bn (Historical cost of ZW$1.861bn) as at 31 December 2021 to ZW$5.660bn (Historical cost of ZW$5.634bn) as at 30 June 2022, representing a 203% increase.
The company maintained good relations with its cedants and retrocession partners during the period. Expansion into the Botswana market is now at an advanced stage, as the company opened for business on 1 June 2022.
ZB Life's inflation adjusted net profit after tax increased from ZW$599.20m in June 2021 to ZW$1.285bn for the period ending 30 June 2022. In historical cost terms, net profit after tax improved by 1 686% to ZW$3.570bn. The company's total assets increased from ZW$12.889bn (Historical cost of ZW$5.852bn) as at 31 December 2021 to ZW$14.189bn (Historical cost of ZW$13.978bn) as at 30 June 2022, representing a 10% increase.
Other Strategic Developments:
The Group continued to progress its organisational transformation program during the review period. The program is designed to transform the organisational design into a more people-centric one, and to enhance the customer journey in order to delight the Group's customers through a combination of digitalisation and service excellence.
As part of the transformation, the Group has come up with new structures designed to remove silos in its operations, and is currently making new appointments in line with the new structure - this exercise is scheduled for completion in Q3 2022.
The Group also continued to progress the conversion of branches into one-stop customer service centres, with 14 branches having been converted to service centres as at 30 June 2022.
Furthermore, in its drive to continuously progress environmental, social and governance (ESG) tenets, the Group continues to record progress in its quest to attain certification under the Sustainability Standards & Certification Initiative (SSCI) being driven by the European Organisation for Sustainable Development (ESOD) with guidance from the Reserve Bank of Zimbabwe (RBZ) - the Group is targeting certification by end of 2022.
Group Human Resources and Training:
Despite the operating environment progressively becoming less competitive relative to other countries in the region and beyond, staff attrition in the Group remained within acceptable levels.
During the period under review, the Group successfully launched a new organisational design which is currently being implemented. The Group also embarked on a programme of staff training and development to facilitate transformation into a high performing organisational culture.
Industrial relations remained cordial during the period under review.
Appreciation:
I extend my gratitude to our valued customers and stakeholders for their continued support and commitment to the ZBFH Group.
I also express my appreciation to Management and Staff team for their contribution to the half year performance.
Finally, I would like to thank the Board for its valuable contribution and wise counsel.
S. T. Fungura
Group Chief Executive Officer
30 August, 2022
ZBFH 257
1
AUDITOR'S STATEMENT
These condensed consolidated inflation adjusted interim financial results of ZB Financial Holdings Limited for the half year financial period ended 30 June 2022, have been reviewed by Messrs KPMG Chartered Accountants (Zimbabwe). A qualified conclusion has been expressed because of the effect of prior year non- compliance with International Accounting Standard 28, Investments in Associates and Joint Ventures, IAS 8, Accounting policies, Changes in Accounting Estimates and Errors and IFRS 13 Fair Value Measurement affecting comparability of prior period's numbers. A copy of the auditor's conclusion is available for inspection at the ZB Financial Holdings' registered office. The engagement partner for this review is Michael de Beer (PAAB Practicing Certificate Number 0369).
CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM STATEMENT OF FINANCIAL POSITION As at 30 June 2022
Inflation adjusted | Historical cost | |||||
Reviewed | Audited | Unreviewed | Unaudited | |||
30 Jun 2022 | 31 Dec 2021 | 30 Jun 2022 | 31 Dec 2021 | |||
Notes | ZW$ | ZW$ | ZW$ | ZW$ | ||
ASSETS | ||||||
Cash and cash equivalents | 28 954 067 340 | 21 261 431 494 | 28 954 067 340 | 9 712 078 202 | ||
Treasury bills | 3 | 7 337 967 034 | 5 276 634 384 | 7 337 967 034 | 2 410 330 922 | |
Mortgages and other advances | 4.1 | 20 762 092 597 | 26 779 987 780 | 20 762 092 597 | 12 232 917 414 | |
Financial assets at fair value | ||||||
through profit or loss | 7 592 251 347 | 8 919 719 290 | 7 592 251 347 | 4 074 467 484 | ||
Financial assets held at amortised cost | 1 108 526 198 | 1 294 168 359 | 1 108 526 198 | 591 167 359 | ||
Investments in associates | 11 748 951 622 | 11 261 377 946 | 11 815 141 076 | 4 816 276 853 | ||
Inventories | 273 551 799 | 173 028 345 | 196 020 983 | 72 791 173 | ||
Trade and other receivables | 8 849 460 689 | 4 361 843 230 | 8 849 460 689 | 1 992 460 506 | ||
Investment properties | 5.1 | 13 231 952 001 | 9 739 525 678 | 13 231 952 001 | 4 448 949 501 | |
Right of use assets | 6 | 821 370 447 | 484 583 306 | 310 721 443 | 102 568 596 | |
Property and equipment | 7 | 23 286 038 554 | 20 527 917 088 | 16 348 672 726 | 9 373 518 085 | |
Intangible assets | 8 | 760 122 572 | 443 207 530 | 301 142 377 | 22 206 622 | |
Deferred tax assets | 84 991 082 | 14 103 160 | 153 219 504 | 101 233 | ||
Total assets | 124 811 343 282 | 110 537 527 590 | 116 961 235 315 | 49 849 833 950 | ||
LIABILITIES | ||||||
Deposits and other accounts | 9 | 43 106 109 672 | 43 060 376 684 | 43 106 109 672 | 19 669 689 027 | |
Short term borrowings | 478 706 849 | 882 962 949 | 478 706 849 | 403 331 507 | ||
Trade and other payables | 11 245 290 691 | 9 308 026 097 | 11 245 290 691 | 4 251 843 409 | ||
Current tax liabilities | 1 055 649 001 | 263 451 378 | 1 055 649 001 | 120 342 809 | ||
Long term borrowings | 11 | 17 596 362 | 37 101 405 | 17 596 362 | 16 947 671 | |
Life assurance funds | 6 985 478 501 | 6 922 860 044 | 6 985 478 501 | 3 162 315 677 | ||
Offshore borrowings | 3 934 977 887 | 1 440 282 351 | 3 934 977 887 | 657 911 243 | ||
Deferred tax liabilities | 4 924 238 567 | 4 298 828 598 | 3 251 553 018 | 1 959 555 227 | ||
Lease liabilities | 10 | 287 136 187 | 262 016 880 | 287 136 187 | 119 687 540 | |
Total liabilities | 72 035 183 717 | 66 475 906 386 | 70 362 498 168 | 30 361 624 110 | ||
EQUITY | ||||||
Share capital | 255 856 380 | 255 856 380 | 1 751 906 | 1 751 906 | ||
Share premium | 3 955 133 961 | 3 955 133 961 | 27 081 696 | 27 081 696 | ||
Other components of equity | 21 680 314 732 | 18 452 639 262 | 15 002 993 330 | 8 077 241 786 | ||
Retained income | 19 718 418 043 | 15 853 636 352 | 24 342 082 384 | 8 721 358 380 | ||
Functional currency translation | ||||||
reserve | - | - | 101 292 105 | 101 292 105 | ||
Attributable to equity holders | ||||||
of parent | 45 609 723 116 | 38 517 265 955 | 39 475 201 421 | 16 928 725 873 | ||
Non-controlling interests | 7 166 436 449 | 5 544 355 249 | 7 123 535 726 | 2 559 483 967 | ||
Total equity | 52 776 159 565 | 44 061 621 204 | 46 598 737 147 | 19 488 209 840 | ||
Total equity and liabilities | 124 811 343 282 | 110 537 527 590 | 116 961 235 315 | 49 849 833 950 |
CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME For the half year ended 30 June 2022
Inflation adjusted | Historical cost | |||
Reviewed | Reviewed | Unreviewed | Unreviewed | |
30 Jun 2022 | 30 Jun 2021 | 30 Jun 2022 | 30 Jun 2021 | |
Notes | ZW$ | ZW$ | ZW$ | ZW$ |
CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM STATEMENT OF CHANGES IN EQUITY
For the half year ended 30 June 2022
Reviewed Inflation adjusted | ||||||||||||||||||
Property and | Attributable | |||||||||||||||||
equipment | Financial | to equity | Non | |||||||||||||||
Share | Share | General | revaluation | assets | Retained | holders of | controlling | |||||||||||
capital | premium | reserve | reserve | at FVTOCI | income | parent | interests | Total | ||||||||||
ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ||||||||||
Balance at 1 January 2022 | 255 856 380 | 3 955 133 961 | 46 227 102 | 18 410 246 967 | (3 834 807) | 15 853 636 352 | 38 517 265 955 | 5 544 355 249 | 44 061 621 204 | |||||||||
Changes in equity for 2022 | ||||||||||||||||||
Profit or loss | ||||||||||||||||||
Profit for the period | - | - | - | - | - | 4 458 132 713 | 4 458 132 713 | 1 611 214 673 | 6 069 347 386 | |||||||||
Other comprehensive income, net of tax | ||||||||||||||||||
Revaluation of property | - | - | - | 3 099 354 418 | - | - 3 099 354 418 | 14 364 912 | 3 113 719 330 | ||||||||||
Fair value gain on financial assets at FVTOCI | - | - | - | - | 126 237 989 | - | 126 237 989 | - | 126 237 989 | |||||||||
Transaction with owners of the parent | ||||||||||||||||||
Dividends paid | - | - | - | - | - | (593 351 022) | (593 351 022 ) | (3 498 385) | (596 849 407) | |||||||||
Effects of inflation adjustments | - | - | - | - | 2 083 063 | - | 2 083 063 | - | 2 083 063 | |||||||||
Balance at 30 June 2022 | 255 856 380 | 3 955 133 961 | 46 227 102 | 21 509 601 385 | 124 486 245 | 19 718 418 403 | 45 609 723 116 | 7 166 436 449 | 52 776 159 565 | |||||||||
Balance 1 January 2021 | 255 856 380 | 3 955 133 961 | 46 227 102 | 6 986 836 301 | (6 310 053) | 12 660 956 759 | 23 898 700 450 | 4 384 171 066 | 28 282 871 516 | |||||||||
Changes in equity for 2021 | ||||||||||||||||||
Profit or loss | ||||||||||||||||||
Profit for the period | - | - | - | - | - | 1 870 998 492 | 1 870 998 492 | 416 392 730 | 2 287 391 222 | |||||||||
Other comprehensive income, net tax | ||||||||||||||||||
Fair value gain on financial assets at FVTOCI | - | - | - | - | (2 986 470) | - | (2 986 470 ) | - | (2 986 470) | |||||||||
Effects of inflation adjustments | - | - | - | - | 1 081 662 | - | 1 081 662 | - | 1 081 662 | |||||||||
Balance at 30 June 2021 | 255 856 380 | 3 955 133 961 | 46 227 102 | 6 986 836 301 | (8 214 861) | 14 531 955 251 | 25 767 794 134 | 4 800 563 796 | 30 568 357 930 | |||||||||
Unreviewed and Unaudited Historical cost | ||||||||||||||||||
Functional | Property and | Attributable | ||||||||||||||||
currency | equipment | Financial | to equity | Non | ||||||||||||||
Share | Share | translation | General | revaluation | assets | Retained | holders of | controlling | ||||||||||
capital | premium | reserve | reserve | reserve | at FVTOCI | income | parent | interests | Total | |||||||||
ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | |||||||||
Balance at 1 January 2022 | 1 751 906 | 27 081 696 | 101 292 105 | 5 817 958 | 8 073 175 544 | (1 751 716) 8 721 358 380 | 16 928 725 873 | 2 559 483 967 19 488 209 840 | ||||||||||
Changes in equity for 2022 | ||||||||||||||||||
Profit or loss | ||||||||||||||||||
Profit for the period | - | - | - | - | - | - 15 848 461 733 | 15 848 461 733 | 4 521 069 475 20 369 531 208 | ||||||||||
Other comprehensive income, net of tax | ||||||||||||||||||
Revaluation of property | - | - | - | - | 6 799 513 556 | - | - | 6 799 513 556 | 45 658 932 6 845 172 488 | |||||||||
Fair value gain on financial assets at FVTOCI | - | - | - | - | - | 126 237 988 | - | 126 237 988 | - | 126 237 988 | ||||||||
Transaction with owners of the parent | ||||||||||||||||||
Dividends paid | - | - | - | - | - | - | (227 737 729) (227 737 729) | (2 676 648 ) (230 414 377 ) | ||||||||||
Balance at 30 June 2022 | 1 751 906 | 27 081 696 | 101 292 105 | 5 817 958 | 14 872 689 100 | 124 486 272 24 342 082 384 | 39 475 201 421 | 7 123 535 726 46 598 737 147 | ||||||||||
Balance 1 January 2021 | 1 751 906 | 27 081 696 | 101 292 105 | 5 817 958 | 2 406 801 864 | (1 793 231) 3 844 673 945 | 6 385 626 243 | 1 250 730 186 | 7 636 356 429 | |||||||||
Changes in equity for 2021 | ||||||||||||||||||
Profit or loss | ||||||||||||||||||
Profit for the period | - | - | - | - | - | - | 828 960 869 | 828 960 869 | 140 664 599 | 969 625 468 | ||||||||
Other comprehensive income, net tax | ||||||||||||||||||
Fair value gain on financial assets at FVTOCI | - | - | - | - | - | (1 024 298) | - | (1 024 298) | - | (1 024 298 ) | ||||||||
Balance at 30 June 2021 | 1 751 906 | 27 081 696 | 101 292 105 | 5 817 958 | 2 406 801 864 | (2 817 529) 4 673 634 814 | 7 213 562 814 | 1 391 394 785 | 8 604 957 599 |
CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM STATEMENT OF CASH FLOWS
For the half year ended 30 June 2022
Inflation adjusted | Historical cost | |||
Reviewed | Reviewed | Unreviewed | Unreviewed | |
30 Jun 2022 | 30 Jun 2021 | 30 Jun 2022 | 30 Jun 2021 | |
ZW$ | ZW$ | ZW$ | ZW$ | |
Cash generated from operating activities | 16 865 899 481 | 1 143 100 810 | 32 034 497 014 | 1 471 052 910 |
Interest received | 5 417 431 044 | 3 213 831 806 | 3 208 865 054 | 1 033 337 017 |
Dividends received from listed equities | 151 332 686 | 137 227 063 | 101 885 318 | 44 867 550 |
Interest expense paid | (1 310 970 370) | (564 419 201) | (840 419 568) | (184 345 525) |
Dividend received from associates | 3 458 580 | 24 053 150 | 8 752 162 | 7 689 120 |
Income tax paid | (828 580 978) | (324 367 772) | (771 615 154) | (93 059 700) |
Interest paid expense lease liability | (51 561 574) | - | (33 867 455) | - |
Interest expense on offshore borrowings | (94 222 991) | - | (61 888 974) | - |
Net cash generated from operating activities | 20 152 785 878 | 3 629 425 856 | 33 646 208 397 | 2 279 541 372 |
Cash flows from investing activities | ||||
Purchase of intangible assets | (418 031 025) | - | (279 980 994) | - |
Purchase of property and equipment | (784 155 250) | (145 081 368) | (541 896 707) | (47 035 767) |
Interest income | 12 |
Interest expense | 13 |
Net interest income Loan impairment charges, net recoveries
Net income from lending activities
Gross insurance premium income Total insurance expenses
Net insurance income | |
Commissions and fees | |
Operating income | |
Fair value adjustments | |
Total income | |
Operating expenses | 15 |
Profit from ordinary activities | |
Movement in life assurance funds | |
Share of associate companies | |
profit net of tax | |
Effects of inflation adjustments | |
Profit before taxation | |
Income tax expense | 16 |
Net profit for the period
Profit attributable to:
Owners of parent from continuing operations
Non-controlling interests
Profit for the period
Other comprehensive income: Items that will not be reclassified to profit or loss
Gains on property and equipment revaluation
Fair value gains on financial assets at FVTOCI
Income tax relating to components of other comprehensive income
Other comprehensive income
for the period net of tax | |
Total comprehensive income | |
for the period | |
Total comprehensive income | |
attributable to: | |
Owners of parent from continuing | |
operations | |
Non-controlling interests | |
Total comprehensive income | |
for the period | |
Earnings per share | |
Basic and fully diluted / headline | |
earnings per share (ZW cents) | 17 |
5 417 431 044 | 3 213 831 806 | 3 208 865 054 | 1 033 337 017 |
(1 310 970 370) | (564 419 201) | (840 419 568) | (184 345 525) |
4 106 460 674 | 2 649 412 605 | 2 368 445 486 | 848 991 492 |
(2 289 940 123) | (746 962 222) | (1 761 022 549) | (248 526 662) |
1 816 520 551 | 1 902 450 383 | 607 422 937 | 600 464 830 |
2 932 838 973 | 2 044 363 918 | 2 074 850 965 | 657 733 728 |
(1 917 165 205) | (1 346 274 840) | (1 466 627 967) | (434 342 587) |
1 015 673 768 | 698 089 078 | 608 222 998 | 223 391 141 |
3 885 084 376 | 3 353 480 136 | 2 602 603 435 | 1 079 790 767 |
11 148 395 005 | 978 725 792 | 10 912 584 099 | 326 138 026 |
3 011 800 834 | 1 513 097 829 | 10 993 811 216 | 696 335 798 |
20 877 474 534 | 8 445 843 218 | 25 724 644 685 | 2 926 120 562 |
(9 412 510 340) | (5 970 435 835) | (6 374 190 645) | (1 866 586 034) |
11 464 964 194 | 2 475 407 383 | 19 350 454 040 | 1 059 534 528 |
(62 618 457) | (658 600 083) | (3 823 162 823) | (572 156 719) |
491 032 254 | 1 040 547 463 | 7 001 510 453 | 760 205 256 |
(3 897 309 773) | 57 718 896 | - | - |
7 996 068 218 | 2 915 073 659 | 22 528 801 670 | 1 247 583 065 |
(1 926 720 832) | (627 682 437) | (2 159 270 462) | (277 957 597) |
6 069 347 386 | 2 287 391 222 | 20 369 531 208 | 969 625 468 |
4 458 132 713 | 1 870 998 492 | 15 848 461 733 | 828 960 869 |
1 611 214 673 | 416 392 730 | 4 521 069 475 | 140 664 599 |
6 069 347 386 | 2 287 391 222 | 20 369 531 208 | 969 625 468 |
3 143 252 034 | - | 7 212 968 889 | - |
167 691 271 | (3 967 151) | 167 691 271 | (1 360 652) |
(70 985 987) | 980 682 | (409 249 684) | 336 354 |
3 239 957 318 | (2 986 469) | 6 971 410 476 | (1 024 298) |
9 309 304 704 | 2 284 404 753 | 27 340 941 684 | 968 601 170 |
7 683 725 119 | 1 868 012 023 | 22 774 213 277 | 827 936 571 |
1 625 579 585 | 416 392 730 | 4 566 728 407 | 140 664 599 |
9 309 304 704 | 2 284 404 753 | 27 340 941 684 | 968 601 170 |
2 830 | 1 188 | 10 061 | 526 |
Proceeds on disposal of property and equipment | 5 043 553 | - | 5 043 553 | - |
Purchase of investment securities | (2 367 838 824) | (1 226 667 913) | (1 060 875 001) | (429 231 305) |
Proceeds on disposal of investment securities | 822 280 096 | 1 052 042 234 | 720 406 630 | 354 242 655 |
Net cash used in investing activities | (2 742 701 450) | (319 707 047) | (1 157 302 519) | (122 024 417) |
Cash flows from financing activities | ||||
Dividends paid | (596 849 407) | - | (230 414 377) | - |
Lease capital payments | (74 381 838) | (146 494 488) | (48 856 607) | (24 572 429) |
Proceeds from offshore borrowings | 7 219 912 501 | - | 5 716 634 848 | - |
Repayment on offshore borrowings | (8 032 471 284) | - | (5 276 009 630) | - |
Net cash used in financing activities | (1 483 790 028) | (146 494 488) | 161 354 234 | (24 572 429) |
Net increase in cash and cash equivalents | 15 926 294 400 | 3 163 224 321 | 32 650 260 112 | 2 132 944 526 |
Cash and cash equivalents at beginning of year | 20 368 507 756 | 17 899 117 177 | 6 985 981 279 | 5 086 686 008 |
Effects of exchange rates fluctuating | ||||
on cash and cash equivalents | (7 340 734 816) | (693 833 742) (10 682 174 051) | (233 649 255) | |
Cash and cash equivalents at end of period | 28 954 067 340 | 20 368 507 756 | 28 954 067 340 | 6 985 981 279 |
Cash and cash equivalents comprise: | ||||
Cash | 8 167 000 039 | 7 485 076 722 | 8 167 000 039 | 2 567 228 119 |
Local bank accounts | 13 021 293 527 | 6 636 892 120 | 13 021 293 527 | 2 276 318 160 |
Foreign bank accounts | 7 765 773 774 | 6 246 538 914 | 7 765 773 774 | 2 142 435 000 |
28 954 067 340 | 20 368 507 756 | 28 954 067 340 | 6 985 981 279 |
NOTES TO CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM FINANCIAL RESULTS
For the half year ended 30 June 2022
1. BASIS OF PREPARATION
-
Reporting currency
All Group entities have Zimbabwean dollar (ZW$) as their functional currency as at the reporting date. All information presented have been rounded off to the nearest dollar. - Statement of compliance
The condensed consolidated financial results as at, and for the half year ended 30 June 2022, have been prepared under the supervision of E Mungoni CA(Z), Group Finance Director of ZB Financial Holdings Limited. The condensed consolidated inflation adjusted interim financial results are required to be prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" as well as the requirements of the Securities and Exchange (Zimbabwe Stock Exchange) (ZSE) Listing Rules, 2019 and in the manner required by the Companies and Other Business Entities Act (Chapter 24:31), the Banking Act (Chapter 24:20), the Building Societies Act (Chapter 24:02), Securities and Exchange Act (Chapter 24:25) and relevant regulations made thereunder. They do not include all the information required for a complete set of International Financial Reporting Standards ("IFRS") financial statements. However, selected explanatory notes are included to explain events and transactions that are significant to the understanding of the changes in the Group's financial position and performance since the last Group annual financial statements. They should therefore be read in conjunction with the Group's annual financial results for the year ended 31 December 2021.
The preparation of the condensed consolidated financial results, in conformity with IAS 29 "Financial Reporting in Hyperinflationary Economies" is required by International Financial Reporting Standards (IFRS). The condensed consolidated inflation adjusted financial results are to be the principal financial results of the Company and its subsidiaries. The condensed consolidated historical cost financial results have been provided as supplementary information and as a result the auditors have not expressed an opinion on them.
The condensed consolidated financial results were authorised for issue by the board of directors on 30 August 2022.
ZBFH 257
2
NOTES TO CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM FINANCIAL RESULTS (Continued)
1.3 Effects of inflation adjustments |
The Public Accountants and Auditors Board (PAAB), through circular 01/19 indicating the conditions required for the application |
of International Accounting Standard ("IAS") 29, Financial Reporting in Hyper-Inflationary Economies. All entities reporting in |
Zimbabwe were now required to apply the requirements of IAS 29 with effect from 1 July 2019. |
The restatement of figures has been calculated by means of conversion factors derived from the consumer price index (CPI) |
NOTES TO CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM FINANCIAL RESULTS (Continued)
Reviewed Inflation adjusted | ||||
Other | ||||
Banking | Insurance | strategic | ||
operations | operations | investments1 | Total | |
30 June 2021 | ZW$ | ZW$ | ZW$ | ZW$ |
prepared by the Zimbabwe Central Statistical Office. The conversion factors used to restate the consolidated financial statements |
at 30 June 2022 are as follows: |
Conversion | ||
Index | factors | |
30-Jun-22 | 8707.35 | 1.0000 |
31-Dec-21 | 3977.46 | 2.1892 |
30-Jun-21 | 2986.44 | 2.9156 |
The main guidelines for the restatement are as follows:
• All amounts not already expressed in terms of the measuring unit current at the statement of financial position date are |
restated by applying a general CPI. |
• Corresponding figures for previous periods are similarly restated. |
• Monetary assets and liabilities are not restated because they are already expressed in terms of the monetary unit current at |
the statement of financial position date. Monetary items are money held, assets and liabilities to be recovered or paid at the |
nominal value recorded at the original cost. |
• Non-monetary assets carried at cost (excluding PPE and investment property) and liabilities and the components of |
shareholding's equity are restated by applying the relevant conversion factors reflecting the increase in the CPI from the date |
of change in functional currency from US$ to ZW$ in 2018. |
External revenue
Net earnings / (losses) from lending activities Net fees and commission income
Other revenue / (expenses) Fair value adjustments Total segment revenue
Inter segmental revenue
Total segment operating expenses
Material non-cash items: Depreciation
Amortisation of intangible assets
Profit from associates net of tax Reportable segment profit before taxation
Income tax expense Reportable segment assets as at 31 December 2021
Reportable segment liabilities as at 31 December 2021
Investment in associates as at 31 December 2021
1 984 509 884 | (19 945 211) | (62 114 290) | 1 902 450 383 |
3 292 416 714 | 700 884 727 | 58 267 773 | 4 051 569 214 |
2 300 440 250 | 640 595 985 | (1 962 310 443) | 978 725 792 |
1 314 574 791 | 482 453 371 | (283 930 333) | 1 513 097 829 |
8 891 941 639 | 1 803 988 872 | (2 250 087 293) | 8 445 843 218 |
1 605 835 123 | - | 2 420 756 546 | 4 026 591 669 |
(5 400 791 509) | (705 614 819) | 135 970 493 | (5 970 435 835) |
(497 205 930) | (14 984 258) | (27 303 788) | (539 493 976) |
(58 456 368) | (252 263) | - | (58 708 631) |
- | 995 615 962 | 44 931 501 | 1 040 547 463 |
2 256 722 736 | 821 854 756 | (163 503 833) | 2 915 073 659 |
661 201 130 | (52 802 942) | 19 284 249 | 627 682 437 |
89 852 627 473 | 17 031 489 765 | 3 653 410 352 | 110 537 527 590 |
57 761 172 362 | 9 523 469 786 | (808 735 762) | 66 475 906 386 |
- | 8 727 001 999 | 2 534 375 947 | 11 261 377 946 |
• All items in the consolidated statement of profit or loss and other comprehensive income are restated by applying the |
respective monthly factors. |
• The capitalisation of borrowing costs during construction of a qualifying asset is considered to be a partial recognition of |
inflation and is reversed to the consolidated statement of profit or loss and other comprehensive income and replaced by |
indexed cost. |
• The effect of general inflation on the net monetary position is included in the consolidated statement of profit or loss and |
other comprehensive income as effects of inflation adjustments. |
• Share capital and share premium were restated from the date of change in functional currency from US$ to ZW$ in 2018. |
1.4 Basis of reporting |
The same accounting policies and methods of computation were applied to the financial results as at the reporting date of |
ZB Bank Limited, ZB Building Society, ZB Life Assurance Limited and ZB Reinsurance Limited, incorporated in this reporting |
package. |
1.5 Basis of consolidation |
Subsidiaries |
A subsidiary is an entity controlled by another entity, that is the parent. The Group controls an entity when it is exposed |
to, or has rights to variable returns from its involvement with the investee and has the ability to exert control over the |
entity's financial and operational decisions through its power over the investee. The results of subsidiaries are included in the |
consolidated financial statements from the date on which control commences until the date on which control ceases. |
Subsidiaries are included in the separate financial statements of the Holding company at their net asset value which is |
considered to be an estimate of fair value. Assets valuation was done for the half year period, and only immovable assets |
were revalued. |
Non-controlling interests (NCI) |
Non-controlling interests are measured at their proportionate share of the fair values of the assets and liabilities recognised. |
Unreviewed Historical cost | ||||
Other | ||||
Banking | Insurance | strategic | ||
operations | operations | investments1 | Total | |
30 June 2022 | ZW$ | ZW$ | ZW$ | ZW$ |
External revenue | ||||
Net earnings / (losses) from lending activities | 656 320 718 | (54 551 880 ) | 5 654 099 | 607 422 937 |
Net fees and commission income | 2 553 736 250 | 610 644 001 | 46 446 182 | 3 210 826 433 |
Fair value adjustments | 6 609 215 845 | 3 998 350 099 | 386 245 272 | 10 993 811 216 |
Other revenue / (expenses) | 9 164 115 898 | 1 915 823 697 | (167 355 496 ) | 10 912 584 099 |
Total segment revenue | 18 983 388 711 | 6 470 265 917 | 270 990 057 | 25 724 644 685 |
Inter segmental revenue | 649 137 364 | - | 30 344 255 969 | 30 993 393 333 |
Total segment operating expenses | (5 706 475 524) | (570 191 827 ) | (97 523 294 ) | (6 374 190 645) |
Material non-cash items: | ||||
Depreciation | (738 254 007) | (14 610 309 ) | (22 359 373 ) | (775 223 689) |
Amortisation of intangible assets | (319 496) | (678 671 ) | (47 072 ) | (1 045 239) |
Profit from associates net of tax | - | 5 133 739 138 | 1 867 771 315 | 7 001 510 453 |
Reportable segment profit before taxation | 13 276 913 187 | 7 210 650 407 | 2 041 238 076 | 22 528 801 670 |
Income tax expense | 1 147 959 495 | 1 198 873 594 | (187 562 627 ) | 2 159 270 462 |
Reportable segment assets as at | ||||
30 June 2022 | 93 622 609 492 | 19 695 171 715 | 3 643 454 108 | 116 961 235 315 |
Reportable segment liabilities as at | ||||
30 June 2022 | 60 646 251 567 | 10 237 917 919 | (521 671 318 ) | 70 362 498 168 |
Investment in associates as at 30 June 2022 | - | 9 117 152 752 | 2 697 988 324 | 11 815 141 076 |
Unreviewed Historical cost | ||||
Other | ||||
Banking | Insurance | strategic | ||
operations | operations | investments1 | Total | |
30 June 2021 | ZW$ | ZW$ | ZW$ | ZW$ |
Changes in the Group's interest in a subsidiary that do not result in a loss of control are accounted for as equity |
transactions. |
Where necessary, adjustments are made to the financial statements of subsidiaries and associates to bring the accounting |
policies used into line with those used by the Group. |
Transactions eliminated on consolidation |
Intra-Group transactions, balances, and unrealised income and expenses are eliminated on consolidation. |
1.6 Key sources of judgement and estimation uncertainty |
Significant assumptions and estimations, as at the date of financial reporting, with material implications on the reported |
financial outturn and balances have been made in the following areas: |
• The computation of expected credit losses (IFRS 9) |
• Determination of the fair value of financial assets (IFRS 13) |
• Valuation of property (including investment properties) and equipment (IAS 16 and IAS 40) |
• Estimation of liabilities under insurance contracts including life funds valuation (IFRS 4) |
• Ascertaining of the degree of control or significant influence in investee companies (IAS 27 and IAS 28) |
• Determination of carrying amounts of right of use assets and lease liabilities (IFRS 16) |
The nature of assumptions made and processes involved in the development of estimates, and relevant models used, where applicable, are discussed in the accounting policy notes in the Group's annual report as at 31 December 2021.
The same above significant assumptions and estimates were applied to the extent where relevant, to the financial results as at the reporting date of ZB Bank Limited, ZB Building Society, ZB Life Assurance Limited and ZB Reinsurance Limited, incorporated in this reporting package.
2. SEGMENT INFORMATION | |||
Reviewed Inflation adjusted | |||
Other | |||
Banking | Insurance | strategic |
External revenue
Net earnings / (losses) from lending activities Net fees and commission income
Fair value adjustments Other revenue / (expenses) Total segment revenue
Inter segmental revenue
Total segment operating expenses
Material non-cash items:
Depreciation
Amortisation of intangible assets
Profit from associates net of tax Reportable segment profit before taxation
Income tax expense Reportable segment assets as at 31 December 2021
Reportable segment liabilities as at 31 December 2021
Investment in associates as at 31 December 2021
1 Includes consolidation journals.
3. TREASURY BILLS
627 069 754 | (6 937 886) | (19 667 038) | 600 464 830 |
1 060 279 809 | 224 298 728 | 18 603 371 | 1 303 181 908 |
877 495 243 | 325 028 916 | (506 188 361) | 696 335 798 |
548 852 627 | 274 617 968 | (497 332 569) | 326 138 026 |
3 113 697 433 | 817 007 726 | (1 004 584 597) | 2 926 120 562 |
549 257 115 | - | 1 246 447 037 | 1 795 704 152 |
(1 688 688 985) | (227 383 393) | 49 486 344 | (1 866 586 034) |
(159 102 755) | (4 603 738) | (8 408 481) | (172 114 974) |
(587 584) | (131 157) | - | (718 741) |
- | 618 313 225 | 141 892 031 | 760 205 256 |
876 155 821 | 361 162 870 | 10 264 374 | 1 247 583 065 |
205 667 202 | 68 033 044 | 4 257 351 | 277 957 597 |
40 852 684 721 | 7 744 141 520 | 1 253 007 709 | 49 849 833 950 |
26 366 935 666 | 4 360 017 025 | (365 328 581) | 30 361 624 110 |
- | 3 986 435 528 | 829 841 325 | 4 816 276 853 |
Inflation adjusted | Historical cost | ||
Reviewed | Audited | Unreviewed | Unaudited |
30 Jun 2022 | 31 Dec 2021 | 30 Jun 2022 | 31 Dec 2021 |
ZW$ | ZW$ | ZW$ | ZW$ |
operations | operations | investments1 | Total | |
30 June 2022 | ZW$ | ZW$ | ZW$ | ZW$ |
External revenue | ||||
Net earnings / (losses) from lending activities | 1 859 765 380 | (59 247 200 ) | 16 002 371 | 1 816 520 551 |
Net fees and commission income | 3 813 121 835 | 1 019 429 026 | 68 207 283 | 4 900 758 144 |
Other revenue / (expenses) | 9 457 172 341 | 2 486 555 021 | (795 332 357 ) | 11 148 395 005 |
Fair value adjustments | 37 836 735 | 1 126 139 028 | 1 847 825 071 | 3 011 800 834 |
Total segment revenue | 15 167 896 291 | 4 572 875 875 | 1 136 702 368 | 20 877 474 534 |
Inter segmental revenue | 857 574 328 | - | 12 289 812 347 | 13 147 386 675 |
Total segment operating expenses | (8 822 246 272) | (1 038 721 303 ) | 448 457 235 | (9 412 510 340) |
Material non-cash items: | ||||
Depreciation | (1 124 227 236) | (28 841 563 ) | (8 973 838 ) | (1 162 042 637) |
Amortisation of intangible assets | (87 694 956) | (12 347 300 ) | (78 150 ) | (100 120 406) |
Profit from associates net of tax | - | 428 094 847 | 62 937 407 | 491 032 254 |
Reportable segment profit | ||||
before taxation | 5 174 994 234 | 2 874 213 523 | (53 139 539 ) | 7 996 068 218 |
Income tax expense | 1 498 808 187 | 599 669 416 | (171 756 771 ) | 1 926 720 832 |
Reportable segment assets | ||||
as at 30 June 2022 | 100 698 077 030 | 19 932 503 520 | 4 180 762 732 | 124 811 343 282 |
Reportable segment liabilities | ||||
as at 30 June 2022 | 62 416 016 147 | 10 139 072 264 | (519 904 694 ) | 72 035 183 717 |
Investment in associates as at 30 June 2022 | - | 9 155 096 845 | 2 593 854 777 | 11 748 951 622 |
Treasury bills include: | ||||
Assets classified as at fair value through | ||||
profit or loss' (FVTPL): | ||||
Short term treasury bills 1 | 6 127 728 321 | 4 556 347 268 | 6 127 728 321 | 2 081 308 636 |
Assets classified as 'at fair value through | ||||
other comprehensive income (FVTOCI): | ||||
Medium term treasury bills | ||||
acquired from the market 2 | 1 170 406 146 | 624 010 232 | 1 170 406 146 | 285 043 656 |
Assets classified as 'amortised cost' (AMCO): | ||||
Treasury bills issued as substitution | ||||
for debt instruments 3 | 20 724 067 | 55 465 337 | 20 724 067 | 25 336 191 |
Capitalisation treasury bills 4 | 19 108 500 | 40 811 547 | 19 108 500 | 18 642 439 |
7 337 967 034 | 5 276 634 384 | 7 337 967 034 | 2 410 330 922 | |
Maturity within 1 year | 7 287 975 238 | 5 167 193 633 | 7 287 975 238 | 2 360 339 126 |
Maturity after 1 year | 49 991 796 | 109 440 751 | 49 991 796 | 49 991 796 |
7 337 967 034 | 5 276 634 384 | 7 337 967 034 | 2 410 330 922 |
- The Group invested in treasury bills issued by the RBZ over a period ranging from 3 days to 12 months which were at rates ranging from 5% to 21% (December 2021: 21%).
- The Group purchased treasury bills from the secondary market. These treasury bills have coupon rate of 15% (December 2021: 5% to 15%) with a maturity period of 730 days.
- The Group received treasury bills as substitution for debt instruments from the Zimbabwe Asset Management Company (ZAMCO). The treasury bills have a coupon rate of 5% (December 2021: 5%) and maturity periods ranging from 3.5 months to 10 years (December 2021: 2 to 13 years).
- Capitalisation Treasury Bills (CTBs) with a face value of $20 000 000 were acquired on 26/05/2015 from the Government of Zimbabwe by the holding company, ZB Financial Holdings Limited (ZBFH). The CTBs mature on 26/05/2025 and carry a coupon of 1% which is payable on maturity.
ZBFH 257
3
NOTES TO CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM FINANCIAL RESULTS (Continued)
-
TREASURY BILLS (continued)
Determination of fair value of treasury bills
The fair value of treasury bills was determined using level 2 inputs due to lack of active market for treasury bills which are classified as "FVTPL". The Group used the discounted cash flow valuation technique by applying a risk discounted rate for comparable risk profiles on the contractual cash flows in order to determine the present value of the treasury bills.
Treasury bills purchased from the secondary market are classified at FVOCI and were fair valued using level 2 inputs. The Group used the discounted cash flow valuation technique by applying discounting rates ranging form 65% to 75% to contractual cash flows in order to determine the present value of the treasury bills. The discounting rates were determined by using the yield curve comparable instruments in the Zimbabwe market.
USD denominated Treasury bills fair value was computed using a proxy discount rate of 2% by reference to US Federal Reserve TBs with same tenor and adjusted for country risk.
Valuation of treasury bills designated as at amortised cost
The treasury bills carried at amortised cost, level 3, which cost having been established at fair value at initial recognition using a Discounted Cash Flow valuation technique in which an assessed discount rate of 5% was applied as a proxy for trade on similar instruments.
Impairment assessment of treasury bills
Treasury bills were assessed for ECL in the current year in line with IFRS 9. Treasury bills, being local sovereign exposures have been assessed as "low risk" instruments and there were no defaults recorded in past on all Government Instruments. The amount of ECL was insignificant as such no adjustment for impairment was recognized. - MORTGAGES AND OTHER ADVANCES
Inflation adjusted | Historical cost | |||
Reviewed | Audited | Unreviewed | Unaudited | |
30 Jun 202 | 31 Dec 2021 | 30 Jun 2022 | 31 Dec 2021 | |
ZW$ | ZW$ | ZW$ | ZW$ | |
NOTES TO CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM FINANCIAL RESULTS (Continued)
Inflation adjusted | Historical cost | ||||
Reviewed | Audited | Unreviewed | Unaudited | ||
30 Jun 2022 | 31 Dec 2021 | 30 Jun 2022 | 31 Dec 2021 | ||
ZW$ | ZW$ | ZW$ | ZW$ | ||
5.2 | Reconciliation of carrying | ||||
amount | |||||
Balance at beginning of year | 9 739 525 678 | 7 663 975 854 | 4 448 949 501 | 2 177 997 851 | |
Additions | - | 239 044 060 | - | 87 984 925 | |
Transfer from owner occupied | - | 164 040 210 | - | 46 618 000 | |
Fair value adjustment | 3 492 426 323 | 1 672 465 554 | 8 783 002 500 | 2 136 348 725 | |
Balance at end of period | 13 231 952 001 | 9 739 525 678 | 13 231 952 001 | 4 448 949 501 | |
6. | RIGHT OF USE ASSETS | ||||
Balance at the beginning of year | 484 583 306 | 233 065 526 | 102 568 596 | 66 234 057 | |
Depreciation | (93 504 264) | (161 126 259) | (61 416 889) | (57 037 263) | |
Lease modifications | 410 406 977 | 263 768 776 | 269 569 736 | 93 371 802 | |
Effects of inflation adjustment | 19 884 428 | 148 875 263 | - | - | |
Balance at end of period | 821 370 447 | 484 583 306 | 310 721 443 | 102 568 596 |
7. PROPERTY AND EQUIPMENT
Reviewed Inflation adjusted | |
Equipment | Marine assets |
- Gross loan book
Mortgage advances
Other advances:
Loans, overdraft and other accounts Finance leases
Bills discounted Insurance advances Total other advances
Gross advances
Off balance sheet exposuresIn respect of Guarantees In respect of Letter of credit
In respect of Loan commitments Gross credit exposure
Gross advances
Less: Allowance for loan impairments Net advances - Maturity analysis
On demand Within 1 month Between 1 and 6 months Between 6 and 12 months After 12 months - Non-performingloans
Included in the above are the following;
Included in the above are the following; Non-performing loans
Less: Allowance for loan impairments Value to be received from security held
736 389 805 | 712 189 612 | 736 389 805 | 325 323 401 |
17 791 954 795 | 23 290 700 370 | 17 791 954 795 | 10 639 034 509 |
1 742 227 468 | 2 959 095 620 | 1 742 227 468 | 1 351 694 879 |
347 560 081 | 887 911 999 | 347 560 081 | 405 592 200 |
1 146 766 717 | 484 474 204 | 1 146 766 717 | 221 304 542 |
21 028 509 061 | 27 622 182 193 | 21 028 509 061 | 12 617 626 130 |
21 764 898 866 | 28 334 371 805 | 21 764 898 866 | 12 942 949 531 |
1 863 544 018 | 1 814 872 363 | 1 863 544 018 | 829 021 429 |
1 975 898 094 | - | 1 975 898 094 | - |
6 593 002 500 | 1 595 207 944 | 6 593 002 500 | 728 680 207 |
32 197 343 478 | 31 744 452 112 | 32 197 343 478 | 14 500 651 167 |
21 764 898 866 | 28 334 371 805 | 21 764 898 866 | 12 942 949 531 |
(1 002 806 269) | (1 554 384 025) | (1 002 806 269) | (710 032 117) |
20 762 092 597 | 26 779 987 780 | 20 762 092 597 | 12 232 917 414 |
1 635 980 437 | 2 166 823 558 | 1 635 980 437 | 989 790 356 |
674 939 376 | 1 299 730 177 | 674 939 376 | 593 707 960 |
5 305 317 462 | 3 005 146 032 | 5 305 317 462 | 1 372 730 396 |
11 715 445 603 | 5 612 439 468 | 11 715 445 603 | 2 563 724 415 |
12 865 660 600 | 19 660 312 877 | 12 865 660 600 | 8 980 698 040 |
32 197 343 478 | 31 744 452 112 | 32 197 343 478 | 14 500 651 167 |
119 081 081 | 1 093 221 014 | 119 081 081 | 499 375 970 |
(26 859 481) | (1 023 233 986) | (26 859 481) | (467 406 369) |
92 221 600 | 69 987 028 | 92 221 600 | 31 969 601 |
Freehold | Leasehold | furniture | Computer | and motor Capital work | |||
properties | improvements | & fittings | equipment | vehicles | in progress | Total | |
30 June 2022 | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ |
GROUP | |||||||
Cost or valuation | |||||||
Balance at 1 January 2022 | 8 926 310 668 | 4 173 822 997 | 7 538 652 183 | 9 302 794 376 | 2 094 364 908 | 138 129 934 | 32 174 075 066 |
Additions | - | 1 581 477 | 147 924 919 | 199 844 939 | 159 476 936 | 275 326 979 | 784 155 250 |
Disposals | - | - | - | (1 833 523) | (8 672 631) | - | (10 506 154) |
Surplus on revaluation | 3 114 058 983 | - | 62 746 | - | 29 130 305 | - 3 143 252 034 | |
Balance at 30 June 2022 | 12 040 369 651 | 4 175 404 474 | 7 686 639 848 | 9 500 805 792 | 2 274 299 518 | 413 456 913 | 36 090 976 196 |
Accumulated depreciation and | |||||||
impairment | |||||||
Balance at 1 January 2022 | 1 414 883 783 | 3 920 360 393 | 2 229 400 940 | 2 672 824 058 | 1 290 258 503 | 118 430 301 | 11 646 157 978 |
Recognised in statement of profit | |||||||
or loss | 215 980 798 | 11 815 594 | 161 452 861 | 701 497 007 | 71 296 377 | - 1 162 042 637 | |
Disposals | - | - | - | (96 609) | (3 166 364) | - | (3 262 973) |
Balance at 30 June 2022 | 1 630 864 581 | 3 932 175 987 | 2 390 853 801 | 3 374 224 456 | 1 358 388 516 | 118 430 301 | 12 804 937 642 |
Carrying value at 30 June 2022 | 10 409 505 070 | 243 228 487 | 5 295 786 047 | 6 126 581 336 | 915 911 002 | 295 026 612 | 23 286 038 554 |
Carrying value at 31 December 2021 | 7 511 426 885 | 253 462 604 | 5 309 251 243 | 6 629 970 318 | 804 106 405 | 19 699 633 | 20 527 917 088 |
Audited Inflation adjusted | |||||||
Equipment | Marine assets | ||||||
Freehold | Leasehold | furniture | Computer | and motor Capital work | |||
properties | improvements | & fittings | equipment | vehicles | in progress | Total | |
31 December 2021 | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ |
GROUP | |||||||
Cost or valuation | |||||||
Balance at 1 January 2021 | 6 761 985 742 | 1 573 480 399 | 2 120 831 586 | 4 553 826 335 | 1 855 617 373 | 316 437 950 | 17 182 179 385 |
Additions | - | 23 768 397 | 103 396 202 | 153 713 249 | 87 566 970 | 50 775 149 | 419 219 967 |
Disposals | - | - | (6 763 616) | (4 560 858) | (24 607 695) | - | (35 932 169) |
Transfer between categories | - | 148 626 374 | 51 669 589 | 236 318 987 | - | (436 614 950) | - |
Reclassication to investment properties | (202 215 939) | - | - | - | - | - | (202 215 939) |
Surplus on revaluation | 2 366 540 865 | 2 427 947 827 | 5 269 518 422 | 4 363 496 663 | 175 788 260 | - 14 603 292 037 | |
Reclassification to intangibles | - | - | - | - | - | 207 531 785 | 207 531 785 |
For the secured non-performing loans, security exists in the form of liens registered over funded accounts, bonds registered over landed property and guarantees in various forms. The Group discounts the value of the security at hand using internal thresholds for prudential purposes. Generally, no security value is placed on ordinary guarantees.
Inflation adjusted | Historical cost | ||||||||
Reviewed | Audited | Unreviewed | Unaudited | ||||||
30 Jun 2022 | As a % of | 31 Dec 2021 | As a % of | 30 Jun 2022 | As a % of | 31 Dec 2021 | As a % of | ||
ZW$ | Total | ZW$ | Total | ZW$ | Total | ZW$ | Total | ||
4.4 Sectorial analysis | |||||||||
Gross advances: | |||||||||
Private | 7 747 245 203 | 24% | 13 858 672 928 | 44% | 7 747 245 203 | 24% | 6 330 548 124 | 44% | |
Agriculture | 1 225 114 772 | 4% | 2 591 100 273 | 8% | 1 225 114 772 | 4% | 1 183 597 092 | 8% | |
Mining | 748 541 583 | 2% | 1 048 134 526 | 3% | 748 541 583 | 2% | 478 780 767 | 3% | |
Manufacturing | 763 592 240 | 2% | 495 655 239 | 2% | 763 592 240 | 2% | 226 411 963 | 2% | |
Distribution | 1 522 690 640 | 5% | 1 565 788 534 | 5% | 1 522 690 640 | 5% | 715 241 619 | 5% | |
Construction | 115 571 028 | 0% | 53 736 993 | 0% | 115 571 028 | 0% | 24 546 695 | 0% | |
Transport | 990 745 450 | 3% | 991 671 251 | 3% | 990 745 450 | 3% | 452 988 725 | 3% | |
Services | 6 531 890 945 | 20% | 6 199 429 524 | 20% | 6 531 890 945 | 20% | 2 831 857 506 | 20% | |
Financial | 2 079 114 628 | 6% | 1 420 219 263 | 4% | 2 079 114 628 | 6% | 648 746 560 | 4% | |
Communication | 40 392 377 | 0% | 109 963 274 | 0% | 40 392 377 | 0% | 50 230 480 | 0% | |
Total gross advances | 21 764 898 866 | 66% | 28 334 371 805 | 89% | 21 764 898 866 | 66% | 12 942 949 531 | 89% | |
Guarantees: | |||||||||
Manufacturing | 1 829 658 831 | 6% | 1 721 531 580 | 6% | 1 829 658 831 | 6% | 786 383 990 | 6% | |
Distribution | 7 652 701 | 0% | 72 663 260 | 0% | 7 652 701 | 0% | 33 192 086 | 0% | |
Construction | 1 590 200 | 0% | 2 057 824 | 0% | 1 590 200 | 0% | 940 000 | 0% | |
Services | - | 0% | - | 0% | - | 0% | 8 505 353 | 0% | |
Communication | 24 642 286 | 0% | 18 619 699 | 0% | 24 642 286 | 0% | - | 0% | |
Financial Services | - | 0% | - | 0% | - | 0% | - | 0% | |
Total guarantees | 1 863 544 018 | 6% | 1 814 872 363 | 6% | 1 863 544 018 | 6% | 829 021 429 | 6% | |
Loan commitments: | |||||||||
Private | 298 913 475 | 2% | 646 380 536 | 2% | 298 913 475 | 2% | 295 262 260 | 2% | |
Agriculture | 31 360 040 | 0% | 3 163 050 | 0% | 31 360 040 | 0% | 1 444 860 | 0% | |
Mining | 280 313 522 | 1% | 190 359 557 | 1% | 280 313 522 | 1% | 86 954 959 | 1% | |
Manufacturing | 1 560 984 937 | 5% | 249 440 015 | 1% | 1 560 984 937 | 5% | 113 942 513 | 1% | |
Distribution | 24 558 300 | 0% | 11 687 172 | 0% | 24 558 300 | 0% | 5 338 621 | 0% | |
Construction | 1 554 610 621 | 5% | 120 761 137 | 0% | 1 554 610 621 | 5% | 55 162 871 | 0% | |
Transport | 30 804 477 | 0% | - | 0% | 30 804 477 | 0% | - | 0% | |
Communication | 2 795 627 033 | 9% | 299 005 061 | 1% | 2 795 627 033 | 9% | - | 1% | |
Services | 15 830 095 | 0% | 74 411 416 | 0% | 15 830 095 | 0% | 136 583 491 | 0% | |
Financial Services | - | 0% | - | 0% | - | 0% | 33 990 632 | 0% | |
Total loan commitments | 6 593 002 500 | 22% | 1 595 207 944 | 5% | 6 593 002 500 | 22% | 728 680 207 | 5% | |
Letters of credit: | |||||||||
Manufacturing | 1 660 174 474 | 5% | - | 0% | 1 660 174 474 | 5% | - | 0% | |
Transport | 315 723 620 | 1% | - | 0% | 315 723 620 | 1% | - | 0% | |
Total letters of credit | 1 975 898 094 | 6% | - | 0% | 1 975 898 094 | 6% | - | 0% | |
Total credit exposure | 32 197 343 478 | 100% | 31 744 452 112 | 100% | 32 197 343 478 | 100% | 14 500 651 167 | 100% |
4.5 Mortgage advances
Mortgage advances were spread as follows:
Type of property: - | ||||||||||||
High density | 26 870 253 | 4% | 34 055 489 | 5% | 26 870 253 | 4% | 15 556 317 | 5% | ||||
Medium density | 46 414 919 | 6% | 16 619 694 | 2% | 46 414 919 | 6% | 7 591 764 | 2% | ||||
Low density | 605 532 217 | 82% | 649 357 664 | 91% | 605 532 217 | 82% | 296 622 192 | 91% | ||||
Commercial | 57 572 416 | 8% | 12 156 765 | 2% | 57 572 416 | 8% | 5 553 128 | 2% | ||||
736 389 805 | 100% | 712 189 612 | 100% | 736 389 805 | 100% | 325 323 401 | 100% | |||||
4.6 | Finance lease receivables | |||||||||||
Loans and advances to customers include the following finance lease receivables for leases of certain equipment where the | ||||||||||||
Group is the lessor: | ||||||||||||
Inflation adjusted | Historical cost | |||||||||||
Reviewed | Audited | Unreviewed | Unaudited | |||||||||
30 Jun 2022 | 31 Dec 2021 | 30 Jun 2022 | 31 Dec 2021 | |||||||||
ZW$ | ZW$ | ZW$ | ZW$ | |||||||||
Gross investment in finance leases: | ||||||||||||
Maturing within 1 year | 444 994 970 | 3 339 655 397 | 444 994 970 | 1 525 532 013 | ||||||||
Maturing after 1 year | 4 322 119 136 | 4 490 995 893 | 4 322 119 136 | 2 051 456 570 | ||||||||
Gross investment in finance leases | 4 767 114 106 | 7 830 651 290 | 4 767 114 106 | 3 576 988 583 | ||||||||
Unearned finance charges | (3 024 886 639) | (4 871 555 672) | (3 024 886 639) | (2 225 293 704) | ||||||||
Net investment in finance leases | 1 742 227 467 | 2 959 095 618 | 1 742 227 467 | 1 351 694 879 | ||||||||
Maturing within 1 year | 185 102 825 | 1 359 428 470 | 185 102 825 | 620 977 737 | ||||||||
Maturing after 1 year | 1 557 124 642 | 1 599 667 148 | 1 557 124 642 | 730 717 142 | ||||||||
1 742 227 467 | 2 959 095 618 | 1 742 227 467 | 1 351 694 879 | |||||||||
5. | INVESTMENT PROPERTIES | |||||||||||
5.1 | Made up as follows: | |||||||||||
Land stock held for capital appreciation | ||||||||||||
and completed properties available for lease: | ||||||||||||
Residential | 1 066 431 030 | 784 958 441 | 1 066 431 030 | 358 563 710 | ||||||||
Commercial | 11 834 257 116 | 8 710 736 786 | 11 834 257 116 | 3 979 005 689 | ||||||||
Industrial | 331 263 855 | 243 830 451 | 331 263 855 | 111 380 102 | ||||||||
13 231 952 001 | 9 739 525 678 | 13 231 952 001 | 4 448 949 501 |
Balance at 31 December 2021 | 8 926 310 668 | 4 173 822 997 | 7 538 652 183 | 9 302 794 376 | 2 094 364 908 | 138 129 934 | 32 174 075 066 | ||
Accumulated depreciation and | |||||||||
impairment | |||||||||
Balance at 1 January 2021 | 1 209 614 378 | 1 319 870 479 | 922 473 934 | 2 042 002 458 | 1 184 539 488 | 118 430 301 | 6 796 931 038 | ||
Recognised in statement of profit | |||||||||
or loss | 243 445 130 | 2 597 947 435 | 1 306 198 858 | 631 698 804 | 108 225 306 | - | 4 887 515 533 | ||
Disposals | - | - | (558 001) | (877 204) | (3 580 068) | - | (5 015 273) | ||
Impairment | - | 2 542 479 | 1 286 149 | - | 1 073 777 | - | 4 902 405 | ||
Reclassication to investment properties | (38 175 725) | - | - | - | - | - | (38 175 725) | ||
Balance at 31 December 2021 | 1 414 883 783 | 3 920 360 393 | 2 229 400 940 | 2 672 824 058 | 1 290 258 503 | 118 430 301 | 11 646 157 978 | ||
Carrying value at 31 December 2021 | 7 511 426 885 | 253 462 604 | 5 309 251 243 | 6 629 970 318 | 804 106 405 | 19 699 633 | 20 527 917 088 | ||
Carrying value at 31 December 2020 | 5 552 371 364 | 253 609 919 | 1 198 357 652 | 2 511 823 878 | 671 077 885 | 198 007 650 | 10 385 248 348 | ||
Unreviewed Historical cost | |||||||||
Equipment | Marine assets | ||||||||
Freehold | Leasehold | furniture | Computer | and motor Capital work | |||||
properties | improvements | & fittings | equipment | vehicles | in progress | Total | |||
30 June 2022 | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ||
GROUP | |||||||||
Cost or valuation | |||||||||
Balance at 1 January 2022 | 3 556 664 010 | 106 852 612 | 2 459 475 337 | 3 300 451 063 | 434 803 245 | 64 656 690 | 9 922 902 957 | ||
Additions | - | 814 237 | 100 805 193 | 112 027 061 | 95 776 604 | 232 473 612 | 541 896 707 | ||
Disposals | - | - | - | (1 063 429) | (5 485 155) | - | (6 548 584) | ||
Transfer between categories | - | - | - | - | - | - | - | ||
Reclassication to investment properties | - | - | - | - | - | - | - | ||
Surplus on revaluation | 7 120 199 783 | - | 64 350 | - | 92 704 754 | - | 7 212 968 887 | ||
Reclassification to intangibles | - | - | - | - | - | - | - | ||
Balance at 30 June 2022 | 10 676 863 793 | 107 666 849 | 2 560 344 880 | 3 411 414 695 | 617 799 448 | 297 130 302 | 17 671 219 967 | ||
Accumulated depreciation and | |||||||||
impairment | - | ||||||||
Balance at 1 January 2022 | 125 495 011 | 31 041 822 | 49 443 750 | 275 178 119 | 68 226 170 | - | 549 384 872 | ||
Recognised in statement of profit | |||||||||
or loss | 141 863 784 | 7 763 551 | 113 111 198 | 468 861 662 | 43 623 494 | - | 775 223 689 | ||
Disposals | - | - | - | (58 697) | (2 002 623) | - | (2 061 320) | ||
Impairment | - | - | - | - | - | - | - | ||
Reclassication to investment properties | - | - | - | - | - | - | - | ||
Balance at 30 June 2022 | 267 358 795 | 38 805 373 | 162 554 948 | 743 981 084 | 109 847 041 | - | 1 322 547 241 | ||
Carrying value at 30 June 2022 | 10 409 504 998 | 68 861 476 | 2 397 789 932 | 2 667 433 611 | 507 952 407 | 297 130 302 | 16 348 672 726 | ||
Carrying value at 31 December 2021 | 3 431 168 999 | 75 810 790 | 2 410 031 587 | 3 025 272 944 | 366 577 075 | 64 656 690 | 9 373 518 085 | ||
Unaudited Historical cost | |||||||||
Equipment | Marine assets | ||||||||
Freehold | Leasehold | furniture | Computer | and motor Capital work | |||||
properties | improvements | & fittings | equipment | vehicles | in progress | Total | |||
31 December 2021 | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ||
GROUP | |||||||||
Cost or valuation | |||||||||
Balance at 1 January 2021 | 1 616 342 287 | 49 233 601 | 339 555 297 | 759 481 003 | 217 720 202 | 115 424 734 | 3 097 757 124 | ||
Additions | - | 8 672 256 | 38 526 759 | 55 759 333 | 40 000 000 | 17 045 321 | 160 003 669 | ||
Disposals | - | - | (3 089 574) | (2 069 061) | (11 240 628) | - | (16 399 263) | ||
Transfer between categories | - | 48 946 755 | 16 959 710 | 15 416 960 | - | (81 323 425) | - | ||
Reclassication to investment properties | (47 213 282) | - | - | - | - | - | (47 213 282) | ||
Surplus on revaluation | 1 987 535 005 | - 2 067 523 145 | 2 471 862 828 | 188 323 671 | - | 6 715 244 649 | |||
Reclassification to intangibles | - | - | - | - | - | 13 510 060 | 13 510 060 | ||
Balance at 31 December 2021 | 3 556 664 010 | 106 852 612 | 2 459 475 337 | 3 300 451 063 | 434 803 245 | 64 656 690 | 9 922 902 957 | ||
Accumulated depreciation and | |||||||||
impairment | - | ||||||||
Balance at 1 January 2021 | 38 433 774 | 17 065 579 | 15 029 460 | 48 872 747 | 27 009 029 | - | 146 410 589 | ||
Recognised in statement of profit | |||||||||
or loss | 87 656 518 | 13 936 635 | 34 669 181 | 226 698 456 | 42 852 489 | - | 405 813 279 | ||
Disposals | - | - | (254 891) | (393 084) | (1 635 348) | - | (2 283 323) | ||
Impairment | - | 39 608 | - | - | - | - | 39 608 | ||
Reclassication to investment properties | (595 281) | - | - | - | - | - | (595 281) | ||
Balance at 31 December 2021 | 125 495 011 | 31 041 822 | 49 443 750 | 275 178 119 | 68 226 170 | - | 549 384 872 | ||
- | |||||||||
Carrying value at 31 December 2021 | 3 431 168 999 | 75 810 790 | 2 410 031 587 | 3 025 272 944 | 366 577 075 | 64 656 690 | 9 373 518 085 | ||
Carrying value at 31 December 2020 | 1 577 908 513 | 32 168 022 | 324 525 837 | 710 608 256 | 190 711 173 | 115 424 734 | 2 951 346 535 |
ZBFH 257
4
NOTES TO CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM FINANCIAL RESULTS (Continued)
8. INTANGIBLE ASSETS | ||||
Inflation adjusted | Historical cost | |||
Reviewed | Audited | Unreviewed | Unaudited | |
30 Jun 2022 | 31 Dec 2021 | 30 Jun 2022 | 31 Dec 2021 | |
ZW$ | ZW$ | ZW$ | ZW$ | |
Computer software | ||||
Carrying amount at beginning of year | 443 207 530 | 760 766 686 | 22 206 622 | 28 389 024 |
Additions at cost | 418 031 025 | 24 018 392 | 279 980 994 | 10 358 475 |
Reversal of cancelled projects | - | (22 657 054) | - | (1 385 883) |
Amortisation | (100 120 406) | (111 388 710) | (1 045 239) | (1 644 934) |
Reclassification to equipment | - | (207 531 784) | - | (13 510 060) |
Impairment | (995 577) | - | - | - |
Balance at end of period | 760 122 572 | 443 207 530 | 301 142 377 | 22 206 622 |
NOTES TO CONDENSED CONSOLIDATED INFLATION ADJUSTED INTERIM FINANCIAL RESULTS (Continued)
Inflation adjusted | Historical cost | |||
Reviewed | Reviewed | Unreviewed | Unreviewed | |
30 Jun 2022 | 30 Jun 2021 | 30 Jun 2022 | 30 Jun 2021 | |
ZW$ | ZW$ | ZW$ | ZW$ | |
14. LOAN IMPAIRMENTS | ||||
Loans and advances | (1 935 300 328) | (705 300 234) | (1 635 233 649) | (234 276 129) |
Insurance debtors | (258 550 590) | (22 203 931) | (46 812 551) | (7 615 494) |
Total loans and other advances | (2 193 850 918) | (727 504 165) | (1 682 046 200) | (241 891 623) |
Other financial assets | (39 501 383) | (18 183 377) | (35 418 790) | (6 236 526) |
Guarantees | (32 607 212) | (1 681 013) | (75 922 356) | (360 510) |
Loan commitments | (34 974 098) | (4 979 355) | (34 455 077) | (1 556 855) |
Net recoveries against loans | ||||
previously written off | 10 993 488 | 5 385 688 | 66 819 874 | 1 518 852 |
(2 289 940 123) | (746 962 222) | (1 761 022 549) | (248 526 662) |
9. DEPOSITS AND OTHER ACCOUNTS
-
Summary of deposits by type
Balances of banks Current accounts Savings and call accounts Fixed deposits - Maturity analysis
On demand Within 1 month Between 1 and 6 months Between 6 and 12 months After 12 months
1 429 366 908 | 1 072 061 195 | 1 429 366 908 | 489 710 308 |
9 162 009 252 | 11 518 275 381 | 9 162 009 252 | 5 261 470 343 |
28 067 444 002 | 24 791 071 782 | 28 067 444 002 | 11 324 394 028 |
4 447 289 510 | 5 678 968 326 | 4 447 289 510 | 2 594 114 348 |
43 106 109 672 | 43 060 376 684 | 43 106 109 672 | 19 669 689 027 |
20 272 137 996 | 30 164 786 208 | 20 272 137 996 | 13 779 070 458 |
21 663 439 685 | 11 843 229 025 | 21 663 439 685 | 5 409 906 971 |
1 061 985 168 | 351 087 158 | 1 061 985 168 | 160 374 241 |
49 981 752 | 649 965 383 | 49 981 752 | 296 899 794 |
58 565 071 | 51 308 910 | 58 565 071 | 23 437 563 |
43 106 109 672 | 43 060 376 684 | 43 106 109 672 | 19 669 689 027 |
15. OPERATING EXPENSES | ||||
Commission and fees | 150 273 829 | 117 300 323 | 101 121 556 | 37 838 709 |
Staff expenses | 4 865 847 158 | 2 204 564 886 | 3 379 009 291 | 709 953 080 |
Communication expenses | 154 535 460 | 167 731 650 | 102 387 299 | 53 859 830 |
National Social Security Authority expenses | 57 549 901 | 18 472 607 | 40 768 736 | 6 049 228 |
Pension fund expenses | 156 323 866 | 81 418 374 | 103 600 083 | 26 221 894 |
Computers and information | ||||
technology expenses | 793 712 552 | 846 072 841 | 375 449 921 | 223 211 523 |
Occupation expenses | 273 541 397 | 271 391 456 | 48 273 155 | 81 700 948 |
Transport expenses | 111 371 282 | 53 019 549 | 68 749 422 | 16 750 154 |
Travelling expenses | 136 949 306 | 74 174 234 | 98 933 745 | 24 483 812 |
Depreciation of property and equipment | 1 162 042 637 | 539 493 976 | 775 223 689 | 172 114 974 |
Amortisation of intangible assets | 100 120 406 | 58 708 631 | 1 045 239 | 718 741 |
Depreciation of right of use asset | 93 504 264 | 64 053 513 | 61 416 889 | 10 744 093 |
Finance cost on lease liabilities | 163 588 155 | 94 258 202 | 33 867 455 | 15 810 513 |
Impairment of intangible assets | 995 577 | - | - | - |
Administration expenses | 834 467 584 | 1 207 342 347 | 952 067 313 | 430 452 097 |
Directors fees | 102 517 334 | 74 847 621 | 74 391 537 | 24 235 532 |
Inflation adjusted | Historical cost | ||||||||
Reviewed | Audited | Unreviewed | Unaudited | ||||||
30 Jun 2022 | % | 31 Dec 2021 | % | 30 Jun 2022 | % | 31 Dec 2021 | % | ||
ZW$ | Contribution | ZW$ Contribution | ZW$ Contribution | ZW$ Contribution | |||||
9.3 Deposit concentration | |||||||||
Private individuals | 7 760 988 940 | 18% | 6 909 088 682 | 16% | 7 760 988 940 | 18% | 3 156 025 012 | 16% | |
Agriculture | 1 096 952 793 | 3% | 2 266 503 636 | 5% | 1 096 952 793 | 3% | 1 035 323 542 | 5% | |
Mining | 2 582 398 303 | 6% | 433 971 800 | 1% | 2 582 398 303 | 6% | 198 235 385 | 1% | |
Manufacturing | 2 374 760 230 | 6% | 1 871 047 477 | 4% | 2 374 760 230 | 6% | 854 681 841 | 4% | |
Distribution | 1 129 004 639 | 3% | 1 227 495 347 | 3% | 1 129 004 639 | 3% | 560 711 578 | 3% | |
Construction | 899 573 769 | 2% | 542 785 814 | 1% | 899 573 769 | 2% | 247 940 891 | 1% | |
Transport | 229 180 049 | 1% | 659 210 851 | 2% | 229 180 049 | 1% | 301 123 061 | 2% | |
Services | 18 183 188 502 | 42% | 18 426 135 409 | 43% | 18 183 188 502 | 42% | 8 416 934 114 | 43% | |
Financial | 5 266 806 362 | 12% | 5 345 253 746 | 12% | 5 266 806 362 | 12% | 2 441 675 783 | 12% | |
Communication | 3 583 256 086 | 7% | 5 378 883 922 | 13% | 3 583 256 086 | 7% | 2 457 037 820 | 13% | |
43 106 109 673 | 100% | 43 060 376 684 | 100% | 43 106 109 673 | 100% | 19 669 689 027 | 100% |
Inflation adjusted | Historical cost | |||
Reviewed | Audited | Unreviewed | Unaudited | |
30 Jun 2022 | 31 Dec 2021 | 30 Jun 2022 | 31 Dec 2021 | |
ZW$ | ZW$ | ZW$ | ZW$ | |
9.4 Secured and unsecured deposits analysis | ||||
Secured deposits | - | - | - | - |
Unsecured deposits | 43 106 109 673 | 43 060 376 684 | 43 106 109 673 | 19 669 689 027 |
43 106 109 673 | 43 060 376 684 | 43 106 109 673 | 19 669 689 027 | |
10. LEASE LIABILITIES | ||||
Balance at the beginning of year | 262 016 880 | 244 830 676 | 119 687 540 | 69 577 553 |
Add finance cost posted to profit or loss | 163 588 155 | 150 871 930 | 33 867 455 | 19 538 243 |
Exchange gains | (628 524 095) | (96 709 279) | 185 552 788 | 31 108 045 |
Less lease liability payments during the period | (125 943 412) | (196 727 642) | (82 724 062) | (69 639 836) |
Lease modifications | 255 527 454 | 180 860 560 | 30 752 466 | 118 519 771 |
Effects of inflation adjustment | 360 471 205 | (21 109 365) | - | (49 416 236) |
Balance at end of period | 287 136 187 | 262 016 880 | 287 136 187 | 119 687 540 |
Maturing within 1 year | 57 427 237 | 52 403 376 | 57 427 237 | 23 937 508 |
Maturing after 1 year | 229 708 950 | 209 613 504 | 229 708 950 | 95 750 032 |
Total | 287 136 187 | 262 016 880 | 287 136 187 | 119 687 540 |
11. LONG TERM BORROWINGS | ||||
Comprising of: | ||||
Face value of loan | 20 000 000 | 43 783 485 | 20 000 000 | 20 000 000 |
Valuation discount | (2 403 638) | (6 682 080) | (2 403 638) | (3 052 329) |
Balance at end of period | 17 596 362 | 37 101 405 | 17 596 362 | 16 947 671 |
Valuation discount: | ||||
Balance at beginning of the year | 6 682 080 | 13 580 385 | 3 052 329 | 3 859 361 |
Amortisation during the period | (987 601) | (2 279 808) | (648 691) | (807 032) |
Effects of inflation adjustment | (3 290 841) | (4 618 497) | - | - |
Balance at end of period | 2 403 638 | 6 682 080 | 2 403 638 | 3 052 329 |
Inflation adjusted | Historical cost | |||
Reviewed | Reviewed | Unreviewed | Unreviewed | |
30 Jun 2022 | 30 Jun 2021 | 30 Jun 2022 | 30 Jun 2021 | |
ZW$ | ZW$ | ZW$ | ZW$ | |
12. INTEREST INCOME | ||||
Interest income comprises interest on: | ||||
Advances | 4 293 241 266 | 2 481 782 497 | 2 452 997 159 | 796 375 696 |
Mortgages | 175 166 694 | 85 334 156 | 104 733 624 | 26 273 673 |
Overdraft accounts | 398 291 993 | 340 929 031 | 271 221 731 | 110 338 426 |
Financial assets at amortised cost | 48 569 149 | 43 545 298 | 46 395 416 | 14 078 400 |
Treasury bill at FVTPL | 336 167 119 | 144 142 648 | 220 780 360 | 47 058 123 |
Treasury bills at FVTOCI | 35 586 511 | 26 574 602 | 23 374 472 | 8 122 641 |
Cash and short-term funds | 55 839 033 | 10 263 534 | 37 557 385 | 4 318 346 |
Loans to other banks | 64 202 015 | 147 469 | 45 741 096 | 45 052 |
Other | 10 367 264 | 81 112 571 | 6 063 811 | 26 726 660 |
Total interest income | 5 417 431 044 | 3 213 831 806 | 3 208 865 054 | 1 033 337 017 |
13. INTEREST EXPENSE | ||||
Interest expenses comprise interest on: | ||||
Retail deposits | 62 515 326 | 46 248 217 | 41 009 040 | 14 916 925 |
Fixed deposits | 861 475 515 | 344 021 793 | 546 457 863 | 111 281 568 |
Other interest payable categories | 386 979 529 | 174 149 191 | 252 952 665 | 58 147 032 |
Total interest expenses | 1 310 970 370 | 564 419 201 | 840 419 568 | 184 345 525 |
Net interest income | 4 106 460 674 | 2 649 412 605 | 2 368 445 486 | 848 991 492 |
Audit fees | 255 169 632 | 97 585 625 | 157 885 315 | 32 440 906 |
9 412 510 340 | 5 970 435 835 | 6 374 190 645 | 1 866 586 034 | |
16. INCOME TAX EXPENSE | ||||
Current income tax | 1 437 073 901 | 1 015 193 294 | 1 429 640 624 | 349 194 025 |
Deferred tax expense | 489 646 931 | (387 510 857) | 729 629 838 | (71 236 428) |
1 926 720 832 | 627 682 437 | 2 159 270 462 | 277 957 597 |
- EARNINGS PER SHARE
Basic / headline earnings per share (ZW cents)
The inflation adjusted calculation of basic/headline earnings per share for the period ended 30 June 2022 of ZW2 830 cents (June 2021: ZW1 188 cents) is based on the attributable profit after tax of ZW$4 458 132 713 (June 2021: ZW$1 870 998 492) and weighted average number of shares of 157 522 902 (June 2021:157 522 902)
The unreviewed historical cost calculation of basic/headline earnings per share for the period ended 30 June 2022 of ZW10 061 cents (June 2021: ZW526 cents) is based on the attributable profit after tax of ZW$15 848 461 733 (June 2021: ZW$828 960 869) and weighted average number of shares of 157 522 902 (June 2021:157 522 902).
There were no dilutive instruments for the period. - RISK MANAGEMENT
18.1 Capital risk management
The primary objectives in managing capital at the Group are:
- To guarantee the ability of entities within the Group to continue as going concerns whilst providing an equitable return to the Group's shareholders and benefit to customers and other stakeholders.
- To maintain a strong fallback position which is commensurate with the level of risk undertaken by the entities within the Group in the normal course of their business.
- To comply with the regulatory capital requirements as prescribed by relevant authorities.
The Group's capital consists of equity attributable to the shareholders of the parent Company, comprising the issued share capital, reserves and retained income (all referred to as shareholder's equity) and debt, which includes direct loans plus the residual funding from deposit taking activities after deducting the associated liquidity buffer (referred to as operational funding).
The Group's operating target is to maintain operating assets at a level that is lower than the available operating funds at all times in order to restrict recourse on shareholders' equity for operational funding. Gearing was maintained at above 18%, throughout the year, the Group borrowed funds with a maturity value of ZW$20 million in 2025.
The gearing level, and the loan instrument used are considered comfortable for the Group's operations and are not expected to cause a strain in cash resources in the foreseeable future.
The banking and insurance operations in the Group are subject to prescribed minimum regulatory capital requirements and minimum capital adequacy and solvency ratios as prescribed from time to time.
Management of the Group monitors the level of capital adequacy on a continual basis, employing techniques adopted from the guidelines developed by the Basel Committee and contained in the Basel II capital accord as implemented by the supervisory authorities for each of the affected entities. For the life assurance business, regular actuarial reviews are undertaken to establish the solvency of the business.
An Internal Capital Adequacy Assessment Plan (ICAAP) has been developed for Banking operations and defines capital targets which are generally set above regulatory levels, stress test scenarios and risk appetite across different lines of operations.
18.2 Financial risk management
The Group maintains active trading positions in a variety of non-derivative financial instruments in anticipation of customer demand. The Group manages its trading activities by the type of risk involved and on the basis of the categories of trading instruments held. Regular feedback on risk related matters is provided to the Board through the Board Governance, Risk and Compliance Committee.
18.2.1 Classification and measurement of financial assets and liabilities
Reviewed Inflation adjusted | ||||||||||
CARRYING AMOUNT | FAIR VALUE | |||||||||
Designated | Classified | Designated | ||||||||
at FVTPL | at AMCO | at FVTOCI | Total | Level 1 | Level 2 | Level 3 | Total | |||
30 June 2022 | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ZW$ | ||
Financial assets measured at fair value: | ||||||||||
Listed equity securities | 1 968 140 919 | - | - | 1 968 140 919 | 1 968 140 919 | - | - | 1 968 140 919 | ||
Unlisted equity investments | 5 603 386 360 | - | - | 5 603 386 360 | - | - 5 603 386 360 | 5 603 386 360 | |||
Treasury bills | 6 127 728 321 | - 1 170 406 146 | 7 298 134 467 | - | 6 127 728 321 | 1 170 406 146 | 7 298 134 467 | |||
Financial assets not measured at fair value: | ||||||||||
Trade and other receivables | - | 8 849 460 689 | - | 8 849 460 689 | ||||||
Cash and cash equivalents | - | 28 954 067 340 | - | 28 954 067 340 | ||||||
Treasury bills | - | 39 832 567 | - | 39 832 567 | ||||||
Advances and other accounts | - | 20 762 092 597 | - | 20 762 092 597 | ||||||
Total | 13 699 255 600 | 58 605 453 193 | 1 170 406 146 | 73 475 114 939 | ||||||
Financial liabilities | ||||||||||
Deposit and other accounts | - | (43 106 109 672) | - | (43 106 109 672 ) | ||||||
Trade and other payables | - | (11 245 290 691) | - | (11 245 290 691 ) | ||||||
Offshore borrowings | - | (3 934 977 887) | - | (3 934 977 887 ) | ||||||
Short term borrowings | - | (478 706 849) | - | (478 706 849 ) | ||||||
Long term borrowings | - | (17 596 362) | - | (17 596 362 ) | ||||||
Total | - | (58 782 681 461) | - | (58 782 681 461 ) |
ZBFH 257
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ZB Financial Holdings Ltd. published this content on 31 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 August 2022 07:59:08 UTC.