By Mc Donald Chapalapata, contributor:
Malawi Stock Exchange-listed National Bank of Malawi (NBM) plc has posted a group after-tax profit of K12.8 billion up from K9.1 billion recorded during the first half of the previous year.
This represents a 41 percent increase.
In a statement signed by NBM Board Chairperson George Partridge, Chief Executive Officer Macfussy Kawawa, Board Director Dorothy Ngwira and Chief Finance Officer Masauko Katsala, the bank says the results incorporate, for the first time the performance of recently acquired foreign bank, Akiba Commercial Bank (ACB)
“The results incorporate for the first time, the performance of Akiba, the recently acquired subsidiary in Tanzania which conducted a clean-up of the loan book that resulted in a loss of K1.5 billion,” the statement reads.
It says net interest income increased by 36 percent while non-interest income increased by 51 percent.
Operating expenses increased by 41 percent whereas net impairment on loans and advances grew by 26 percent to K4.8 billion (2020: K3.8 billion).
Customer deposits and the loan book grew by 43 percent and 10 percent, respectively.
The bank’s investment in Treasury bills and Treasury notes grew by 49 percent, according to the statement.
NBM said the economy continued to be negatively impacted by the Covid pandemic and scarcity of foreign currency, which resulted in upward pressure on the exchange rate and inflation.
“While some sectors are showing some signs of rebounding, Tourism and Service sectors remained depressed. The demand for the bank’s credit products in these sectors remained subdued while the expected credit losses increased,” the statement adds.
Going forward, the bank says, in the absence of long-term safety nets, the impending closure of the tobacco selling season and the supply and demand imbalances being experienced on foreign exchange would continue exerting pressure on the exchange rate.
The bank’s board then resolved to pay an interim dividend amounting to K5.0 billion (2020: K2.5 billion), representing K10.71 per share (2020: K5.35 per share).