AfrAsia profit up 68%

Published: 06 October 2013

MAURITIUS-BASED AfrAsia Bank Limited, the parent company of AfrAsia Bank Zimbabwe Limited, recorded a 68 percent increase in after-tax profit to $9,7 million for the year to June 30, 2013.

The growth in profitability was mainly driven by growth in loans, advances, strong fees performance and trading activities compared to the $5,77 million profit achieved the prior year.

The banking conglomerate registered steady growth in customer loans, surging by 10 percent to $448,8 million while customer deposits grew by 39 percent to $865,69 million.

"Year on year, the bank continues to draw interests from local and international investors and raised additional tier one capital of $9,49 million and tier two capital of $9,68 million. Furthermore, it maintained a strong proposed dividend payout ratio, equivalent to US0,05c per share," AfrAsia said.

Group consolidated results were affected this year by negative returns from its Zimbabwe subsidiary AfrAsia Kingdom Limited. This was mainly due to non-performing loans.

AfrAsia Investments Limited, AfrAsia Corporate Finance (Africa) Limited and AfrAsia Corporate Finance Limited performed satisfactorily and the bank said it will be increasing its shareholding in the businesses to 100 percent wholly owned subsidiaries in the next quarter.

This comes after the Mauritian-based financial group upped its interest in AfrAsia Kingdom Limited to 54 percent from 35 percent after acquiring 30 percent shareholding previously held by Kingdom Financial Holdings founder Mr Nigel Chanakira, who no longer holds equity in the group.

In a statement, AfrAsia Bank Limited chief executive officer Mr James Benoit said "AfrAsia Bank continues its "bank different" strategy and is committed to serve its customers in the tough prevailing economic conditions which are creating many opportunities for its business model.

"Regarding our Zimbabwe operations, we have put in place a robust governance process and a restructuring at shareholder, board and management levels has been initiated together with a capital raising exercise which is expected to turn around the business immediately."

AfrAsia chairman Mr Arnaud Lagesse said the pan-African institution's strategy to be the reference bank and right platform to serve the increasing capital and trade flows linking Asia and Africa is starting to pay off and being acknowledged by businessmen and corporate.

"Regional and international growth remain the essential pillars in AfrAsia Bank's growth strategies and our performance during the last few years, along with our increased and diversified capital base, is presenting many expansion opportunities.

"There are still countless opportunities to exploit in the Asia-Africa trade corridor, hence the decision for the bank to aggressively also target the Comesa and Sadc (regional) markets," Mr Lagesse said.

With core Mauritian, South African and Indian business areas performing strongly for AfrAsia in its three customer segments, the bank has already started to review other African banking investments to better serve its customers and developments will be announced in future.
- herald

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