FDH Bank annual profit up 55% to K35.6bn

FDH Bank plc has posted a 55 percent increase in profit after-tax to K35.6 billion in the year ended December 31 2023 on the back of the increase in loan book and other interest bearing assets.

The profit has jumped from the previous year’s K22.9 billion, according to the summary of financial results jointly signed by the bank’s board chairperson Charity Mseka, managing director Noel Mkulichi and chairperson of audit and finance committee Ulemu Katunga.

During the review period, net interest income jumped by 60 percent to K59.8 billion while interest expense has gone down by two percent to K13.5 billion despite the growth of the bank’s deposits by 35 percent from K328 billion to K444 billion due to improved deposit mix.

Reads the financial statement in part: “Non-interest income increased by 33 percent mainly due to the picking up of business as more customers embraced transacting on digital platform.

“International trade and local business transaction volumes also picked up in line with the bank’s strategy.”

In the year, the bank made investments on the delivery channels and coupled with high inflation which was pushed by the 44 percent devaluation of the kwacha pushed up operating expenses by 42 percent year-on-year.

However, the bank said despite the increase in operating expenses, the cost-to-income ratio dropped to 45 percent from 47 percent the previous year.

Despite the increase in interest rates over the review period, the bank’s net impairments charges decreased due to the drop in the expected credit losses and the increased bad debt recoveries.

The bank has declared and paid out dividends amounting to K19.6 billion in the year under review, which included a final dividend of K4 billion in respect of the 2022 profits.