Though the new monetary and fiscal policies announced by the government in the last quarter of 2003 are expected to provide the basis for economic stabilisation and turnaround, the recovery process is expected to be prolonged and arduous, Stanbic Bank says in its report for the year ending December.
The bank says 2003 was a difficult year characterised by an acute shortage of foreign currency with weekly inflows declining from US$15-20 million in the second quarter to less than US$5 million by year end.
Inflation soared from 208.1 percent in January to 619.5 percent in November before dropping to 598.5 percent in December.
Real lending rates deteriorated from minus 150 to -170 percent in the first quarter to minus 350 to -400 percent by December.
Property prices soared over tenfold in the 12 months ending December.
There was sustained low capacity utilisation across the major productive sectors with agricultural and industrial capacity estimated at below 50 percent throughout the year.
But despite all these negatives Stanbic managed a net profit increase of 1852 percent from $1.5 billion to $30.3 billion.
Interest income increased from $4.4 billion to $71.3 billion with net interest income at $63.5 billion, up from $3.6 billion.
Other income grew from $1.3 billion to $10.8 billion while profit before tax soared from$2.6 billion to$47.7 billion.
The bank’s balance sheet grew from $32.6 billion to $219.3 billion.