HARARE – The ZB Financial Holdings (ZBFH) Group, a Zimbabwe-based financial services group, has reported a significant loss of staff, with 98 employees leaving the company in the first half of 2024.
This exodus comes amid a challenging economic environment, which has also seen the group’s profit after tax decline by 60% to ZWG1.06 billion.
“Erratic energy supply, drought brought on by El Niño, strict monetary and fiscal policies intended to stabilize the newly launched Zimbabwe Gold (ZWG) currency, as well as external economic forces, all decreased economic performance.
“The business environment was difficult in light of these factors,” the company noted in its financial results for the half year ended 30 June 2024.
“However, the release of the 2024 Monetary Policy measures have shown commendable stability in the markets and Group continued to take opportunities presented in the market.”
“Our financial results for the half year ended 30 June 2024 reflect the Group’s resilience amidst a challenging economic landscape.
“Despite a 60% decline in profit after tax, the Group maintained profitable, posting a profit after tax (PAT) of ZWG1.06 billion in June 2024 from ZWG2.68 billion in June 2023.
“The Group’s profit performance is discussed in greater detail by the Group Chief Executive in his report.”
The staff departures were due to a combination of a voluntary disengagement scheme (VDS) and a compulsory disengagement scheme (CDS), with 62 staff members opting for the VDS and 36 being let go under the CDS. The group’s staff complement now stands at 995.
“Following adoption of a new Structure supportive of the new business model and organisational design, the Group undertook a job evaluation exercise, closely linked to deployment of staff to fill all positions across the Group,” the company said.
“As at 31 December 2023, this project had been completed. As the new Group Structure settled, the Group adopted a Voluntary Disengagement Scheme (VDS) which was taken up by 62 staff members, mostly those who were nearing retirement.
“However, some staff members could not be accommodated within the new organisational design, thus necessitating a Compulsory Disengagement Scheme (CDS) which saw 36 staff members being disengaged.
“The Group staff complement as at 30 June 2024 stood at 995.”
The economic challenges facing Zimbabwe, including high inflation, currency fluctuations, and drought conditions, have had a significant impact on the group’s performance.
According to data released by the Zimbabwe National Statistics Agency (Zimstat) last week, Zimbabwe’s monthly inflation rate rose to 0.4% in August 2024. This increase was driven by a slight weakening of the local currency on the parallel market.
The month-on-month inflation rate increased by 0.5 percentage points from -0.1% in July 2024 to 0.4% in August 2024. In US dollar terms, the inflation rate was 0.2% for the period, up from -0.1% in July 2024.
On an annual basis, the inflation rate for August 2024 was 3.7%, as measured by the all-items USD Consumer Price Index (CPI).
ZBFH’s operating costs grew by 7% due to macro-level general price increases, while deposits and other related funding account balances decreased by 9%. The group’s total assets increased by 4% in real terms, but earning assets decreased by 7%.
The group’s subsidiaries, ZB Building Society and ZB Reinsurance, also reported significant declines in profit after tax.
ZB Building Society’s profit after tax decreased from ZWG260.420 million in 2023 to ZWG4.743 million in 2024, while ZB Reinsurance posted a net loss after tax of ZWG52.861 million.
Despite the challenges, the group said it remains committed to its medium-term strategy, focusing on sustainable growth, digital transformation, and innovation.
