First Capital Bank’s foreign exchange trading income up 290%

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By Alois Vinga

LEADING financial services provider, First Capital Bank (FCB) has seen a 290% increase in foreign exchange trading income on the back of a resilient half year performance defying the obtaining economic challenges.

The move by monetary authorities allowing trading in foreign currency, has gone a long way in increasing forex access for companies, members of the public as well as creating new revenue streams for financial institutions.

Presenting the group’s performance for the half year period ended June 30, 2022 recently, FCB managing director, Ciaran McSharry, revealed earnings from the business category recorded a significant increase.

“A 290% increase in foreign exchange trading income also contributed significantly to income growth, underlining the effects of exchange rate movements and growth in foreign currency denominated business during the period,” he said.

During the period, the bank’s total deposits grew by 14% to reach ZW$40, 8 billion.

On the same basis, the loans to customers also increased by 37% over the same period to close at ZW$21, 4 billion with 68% of business having been underwritten in foreign currency.

The bank posted a profit of ZW$471, 9m for the six months to June 2022, a slight reduction of 2% from the amount recorded for the same period in 2021 following a significant increase in the monetary loss of 701% and a higher tax charge increase of 116% computed for 2022.

During the period, the bank procured an EUR 12, 5 million open line of credit from the European Investment Bank (EIB) during the period under review as a medium-term facility running up to seven years and is expected to provide capital funding for mid-cap customers.

Recent partnerships with Money Transfer Agencies, RIA and HelloPaisa were followed by the successful launch of Western Union resulting in increased options for customers.

The bank also launched a series of innovative enhancements on its Mobile App, creating a 360-degree banking experience with multiple functionalities. A Gold Card with improved security features for those who travel or make payments online was successfully launched during the period.

“With a volatile macro-economic environment and continued inflationary pressure, the bank’s strategic focus was anchored on preserving capital, building a sustainable operation for the long term, and optimising on growth opportunities on a selective basis,” added McSharry.