CBZ, CABS and Stanbic were most aggressive lenders in 2016 with a market share of 26.59 percent, 17.74 percent and 8.32 percent, respectively, while ZB Building Society, Metbank and NBS were the most conservative lenders with 0.44 percent , 0.65 percent and 0.76 percent, in that order.
Loans and advances were dominated by commercial banks with a market share of 76.61 percent (79.18 percent in 2015) of total loans and building societies had a market share of 20.72 percent as at December 31,2016 from 18.69 percent in 2015.
The total banking sector assets from financial results for the reporting banks grew by 16.32 percent to $7.9 billion as at 31 December 2016 from $6.8 billion as at 31 December 2015.
CBZ maintained its ranking as the largest bank in the country, with an asset base of $1.9 billion, nearly double the size of its nearest competitor, CABS which has a balance sheet size of $1.1 billion.
The top five banks in terms of total assets have 60.97 percent market share of the banking sector’s total assets and this high concentration of assets in the industry enabled them to maintain the lead in the sector as well as boosting their underwriting capacity.
The average net interest margin (NIM) for the sector narrowed to 5.24 percent compared to 6 percent in the previous year.
Agribank and POSB were the most profitable lenders in the period with NIMs of 12.69 percent (10.38 percent previous year) and 7.44 percent (7.14 percent previous year) respectively.
Only the savings bank posted an improvement in net interest margin while both commercial banks and building societies recorded a drop in the key ratio.
Commercial banks on average dropped to 5.14 percent from 6.11 percent while NMI for building societies decreased to 5 percent from 5.41 percent and if excluding NBS, building societies NMI declined from 7 percent previously to 5.98 percent.
The industry’s average fraction of interest income to total income ratio declined to 49.5 percent compared to 57.67 percent recorded in the previous year on the back of reduced lending which has the effect of reducing interest earned.
Agribank, with net interest to total income of 83 percent (77 percent in FY 2015) recorded the highest percentage, followed by NBS and Ecobank which had 80.6 percent and 62.4 percent respectively.
Metbank on the other hand recorded the least net interest to total income ratio of 3.66 percent owing to a very low interest income it recorded in the period.
On average the cost to income ratio (CIR) for the reporting banks, excluding NBS decreased to 72.53 percent from 88.61 percent reported in the previous year, reflecting the success of cost containment measures undertaken by the financial institutions.
FBC Building Society recorded the lowest CIR of 41.2 percent .
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