TANZANIA: AZANIA Bank’s net profit increased by 48.7 per cent in quarter two of this year, thanks to the increased net interest income.
The lender’s financial statement released yesterday showed net profit increased to 7.75bn/- in three months to June from 5.21bn/- posted in a comparative quarter last year.
Net interest income, the report showed, has increased by 29.4 per cent to 27.4bn/- in Q2 from 21.2bn/- recorded in a similar period last year.
The increase in the net interest income was attributed to the number of loans issued by the lender totalling 1.73tri/- at the end of June from 1.68tri/- registered in the first quarter ended March.
Azania bank’s customer deposits increased from 1.59tri/- posted in the first quarter to March this year to 1.66tri/- recorded in June, showing increased customer trust in the lender.
The lender assets grew to 2.3tri/- in three months to June from 2.22tri/-at the end of March.
On other hand non-interest income slightly decreased by 19.8 per cent to 8.65bn/- compared to 10.7bn/- posted in the same period last year.
The decrease in commissions, fees, and other operating income pushed the decrease in non-interest income.
The lender’s commissions and fees decreased by 8.36 per cent to 4.95bn/- from 5.40bn/- recorded in a similar period last year while other operating income decreased by nine times to 258m/- from 2.47bn/- recorded in the same period last year.
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Despite the decrease in commissions and fees plus other operating income, the lender registered an increase in its foreign exchange earnings.
The bank’s foreign exchange earnings, according to the statement, increased by 18.4 per cent to 3.44bn/- until the end of last month from 2.91bn/- registered in the same period last year.
Additionally, Azania’s non-performing loans (NPLs) slightly declined by 0.18 per cent to 121.71bn/- from 121.94bn/- posted at the end of March this year.
As a result, the lender managed to reduce the NPLs ratio from 7.13 per cent in Q1 to 6.83 per cent by the end of Q2.
However, NPLs remains slightly above the regulator’s benchmark ratio of 5.0 per cent. The bank’s operation expenses have increased to 20.67bn/- until the end of last month up from 18.60bn/- recorded in the same period last year, pushed up by increased salaries and benefits.
According to the statement, salaries and benefits increased by 10.4 per cent to 11.3bn/- from 10.2bn/-.
The increment is due to the increased number of staff to 648 at the end of last month from 596 recorded in a similar period last year.
Equally, the lender increased its number of branches to 27 until the end of June from 25.
