First Capital Bank revenue grows by 40%

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 By Alois Vinga

LEADING financial services provider, First Capital Bank (FCB) recorded revenue growth of 40% in the first quarter of 2024 which was attributed to robust management practices defying economic headwinds.

Presenting a trading update for the period, FCB’s company secretary, Sarudzai Binha said the bank posted good results during the period.

“The Bank’s total income, before once-off fair value adjustments, for the first quarter of 2024 grew by 40%, to close at US$20.5 million from US$14.6 million for the same period in 2023. This growth was driven by strong performance in both net interest income and non-funded income,” she said.

During the period, the Bank accelerated lines of credit and interest income bolstered by a 15% increase in the loan book to US$91 million as of 31 March 2024 from US$79 million recorded as of 31 March 2023.

Reflecting general market apprehension, total deposits increased marginally to US$132 million as of 31 March 2024. Funding was thus augmented by recourse to lines of credit whose drawdowns increased from US$2.9 million to US$16.5 million between March 2023 and March 2024. Cost pressures remained elevated, with operating expenses rising by 12% to US$10.4 million in the first quarter of 2024 compared to the same period in 2023.

“A rigorous rationalisation and optimisation exercise is currently underway to curtail cost expansion. The Bank’s non-performing loan ratio (NPL) continued to improve quarter-on-quarter closing at 7% as of 31 March 2024 from 8% in December 2023 and 13% as of June 2023, following various interventions undertaken and underway such as sectoral redistribution to improve overall asset quality,” she said.

Going forward, the bank remains positive about growth prospects in the medium term through diligently harnessing the opportunities whilst exercising robust risk and cost management.

To boost its capacity to support the expected economic rebound, the Bank has mobilised an additional US$15 million line of credit from the African Development Bank.

“This brings the total available facilities from various regional and international funders to US$48.5 million, significantly enhancing the Bank’s capacity to support growth in the key sectors of the economy and facilitate the anticipated economic rebound,” added Binha.