In 2007 the bank returned 84% on its equity and maintained a cost-to-income ratio of 27%. Net profits were considerably higher than 2006, but a fair comparison is hard to make because of Zimbabwe’s soaring inflation rate, which distorts the figures.
Stanbic Bank Zimbabwe has been forced to be creative in its attempts to generate profit, operating as it does in such an economically and politically volatile environment.
In 2007 it targeted sectors such as mining and agricultural commodities in order to tap into revenues from global growth. It also adopted a strategy of growing its short-dated corporate assets in order to boost shareholder return.
At home, the bank introduced internet banking and a customer call centre to better service the needs of its retail and corporate customers. Aware of the critical need to diversify its revenue streams, the bank has also pioneered the introduction of stockbroking, corporate finance and investment banking into Zimbabwe’s underdeveloped bank sector.
The bank managed to slash its non-performing loan ratio from 5% of its loan book in 2005 to almost zero in 2007 – a considerable achievement given the economic backdrop in which Stanbic Bank operates.
