Ned­bank’s non-in­ter­est rev­enue slump by 14% to E69.4 mil­lion

Swazi Observer - - NATIONAL NEWS - By Man­qoba Makhubu

NED­BANK Swazi­land’s non­in­ter­est rev­enue has de­creased by 14 per cent from E88.8 mil­lion in the pre­vi­ous year to E69.4 mil­lion for the half year ended June 2017.

This is ac­cord­ing to the bank’s half year re­sults for the pe­riod be­tween Jan­uary and June 2017.

Non-in­ter­est rev­enue could be un­der­stood as cred­i­tor in­come de­rived pri­mar­ily from fees in­clud­ing de­posit and trans­ac­tion fees, in­suf­fi­cient funds fees, an­nual fees, monthly ac­count ser­vice charges; in­ac­tiv­ity fees, check and de­posit slip fees, and so on.

Con­versely to the de­crease of non­in­ter­est rev­enue, de­posits re­port­edly in­creased by 15 per cent from E3 407 mil­lion to E3 928 mil­lion mostly twisted by whole­sale bank­ing.

The bank noted that it re­leased its re­sults at a time when the econ­omy con­tin­ued to take a hid­ing from global un­cer­tain­ties as well as from do­mes­tic de­vel­op­ments that has im­pacted growth.

The bank re­ported that its net in­ter­est in­come in­creased by 18 per cent to E131.6 mil­lion, mainly due to loans in the per­sonal bank­ing sec­tor.

The bank also saw its head­line earn­ings plunge by 16 per cent from just about E60.9 mil­lion to E50.9 mil­lion com­pared to the same pe­riod last year.

In a state­ment is­sued by the bank, Ned­bank Man­ag­ing Di­rec­tor Fik­ile Nkosi dis­closed that they had an­tic­i­pated a de­cline in head­line earn­ings in their fo­cus and bud­get­ing.

But, she said they re­main up­beat that they will achieve growth go­ing for­ward.

“We, there­fore, looked at en­hanced chan­nels such as the dig­i­tal plat­form. Over­all growth is there, but not in the tra­di­tional in­stru­ments which is de­picted by us­age pick­ing up in our ATMs, point of sale de­vices, in­ter­net bank­ing and the Mo­bile Bank­ing App. The na­ture of the prod­uct cy­cle is that it tends to pick up slowly, but we are op­ti­mistic that by end of the year, up­take will be higher and we look for­ward to con­tin­ued ef­forts to pro­lif­er­ate th­ese chan­nels,” she said.

The com­pany’s profit after tax­a­tion de­creased from about E60.5 mil­lion to about E51 mil­lion.

“Im­pair­ment of loans and ad­vances charge for the pe­riod has in­creased by 36 per cent to E14.2 mil­lion (2016: E10.4 mil­lion). Growth in im­pair­ments is at­trib­uted to un­fa­vor­able eco­nomic con­di­tions,” said the bank.

As at June 30, the bank’s cap­i­tal and re­serves amounted to E676.8 mil­lion pro­vid­ing a cap­i­tal ad­e­quacy ra­tio of 23.1 per cent against the eight per cent statu­tory re­quire­ment.

In its out­look, the bank projects growth op­por­tu­ni­ties in the con­struc­tion and agri­cul­ture sec­tors and there­fore seeks to look into pro­cesses and poli­cies to align it­self with the re­quire­ments of th­ese sec­tors.

“More­over, Ned­bank is poised to lev­er­age on the new brand, which po­si­tions the bank as money ex­perts who do good, through the em­pha­sis on client ex­pe­ri­ence and prod­uct of­fer­ing,” said the bank.

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