Zanaco Records 34% Increase in Income
Zambia’s leading financial institution, Zambia National Commercial Bank plc (ZANACO), majority-owned by Rabo Financial Institutions Development B.V. (“Rabobank”), has reported a remarkable 34% surge in total operating income.
This impressive growth comes at a time when local competitor, Investrust bank, faces insolvency concerns, highlighting ZANACO’s resilience and strategic management amidst industry challenges.
The substantial increase in total operating income, totaling K1.3 billion, is primarily attributed to a 22% rise in interest income (K850 million), supported by a significant 128% growth (K770 million) in treasury trading income.
According to financials disclosed to the Zambian Business Times (ZBT), ZANACO closed the year with profits soaring by 49%, reaching K1.7 billion.
Kaluba G Kaulun’ombe, the Company Secretary of ZANACO, attributed this impressive profitability to a combination of factors, including prudent cost management and efficient credit monitoring practices.
Notably, the bank witnessed a remarkable 88% decrease in impairments, from K186 million in the prior year to K22 million in the 2023 financial year.
Kaulun’ombe highlighted that the bank’s strategic initiatives, aimed at enhancing operational efficiency and future readiness, contributed to a 27% increase (K538 million) in total operating expenses.
Despite this increase, ZANACO’s profitability was buoyed by a robust balance sheet, boasting a total asset base of K45 billion, marking a year-on-year growth of 25%.
The bank’s asset growth was fueled by a surge in customer deposits, which expanded by 14% year-on-year (K4.2 billion), reaching K33.9 billion.
Kaulun’ombe emphasized that this growth aligns with the group’s strategy to bolster deposits, consequently amplifying funds available for investments.
Total liabilities also saw a notable uptick of 23% (K7.5 billion), primarily driven by the growth in customer deposits and deposits from other banks.
Source: ZBT
