HomeLocal NewsCOVID-19, economic headwinds rock StanChart

COVID-19, economic headwinds rock StanChart

STANDARD Chartered Bank says it incurred an after tax loss of ZWL$133,9million for the year ended December 31 compared to the previous year’s profit of ZWL$82,8million due to the impact of inflation on the bank’s performance and balance sheet.

Tafadzwa Mhlanga

In a statement, the bank’s chairman Lovemore Manatsa said 2020 is likely to continue to be challenging due to the continuous devaluing of the local currency and the impacts of the COVID-19.

This comes as inflation rates are galloping and the Zimbabwean dollar has lost 90% of its value since February last year when it was introduced.

“While the authorities are committed to reducing inflation and restoring exchange rate stability, 2020 will most likely be another difficult year due to the continuation of weak fundamentals, the impact of the global COVID-19 outbreak and another poor agricultural season,” Manatsa said.

He said for the country to recover from this economic crisis, it needed to re-engage with the international financial institutions.

“The prevailing headwinds can be reduced if Zimbabwe re-engages with key global financiers as well as a collective effort by all internal stakeholders to implement broad-based market reforms to address political,social and economic issues.”

The bank’s revenue for the period under review also decreased by 10% from ZWL$429,12million to ZWL$381,9million.

Cash and cash equivalents for the year ended December 31, 2019 reduced to ZWL$1,09million from ZWL$2,2 recorded the previous year.

The quality of the loan book continued to improve as reflected by the significant reduction in the non-performing loans ratio from 2,1% as at December, 31, 2018 to 0,1% a year later.

However, the bank is optimistic to meet the revised December 31, 2020 core capital target of the equivalent of US$30 million and it is confident it will achieve the minimum capital requirements by the set deadline.

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