Kingdom records $1,3m profit

HARARE – Afrasia Kingdom Zimbabwe Limited (AKZL) has recorded an after tax profit of $1,3 million for the half year to June compared to $782 031 for the full year.

“The consequent performance is acceptable and in line with the restrained growth in loans and advances,”AKZL chairperson Sibusisiwe Bango said.

“The group’s equity, cash, customer deposits and property investments have improved considerably under rather tight a operating condition, which is commendable.”

She said its flagship banking unit, Kingdom Bank Limited had posted a modest result of $572 136 driven by strong fee and commission income.

“Following the recapitalisation, confidence levels in the bank increased as shown by increase in both retail and corporate deposits,” Bango said.

Kingdom Asset Management’s (Kam) funds under management increased by 20 percent during the period under review to close at $41 million.

“The performance of the asset management unit continued to improve with the unit posting a modest profit after tax of $32 751.With the AKZL having been capitalised ………Kam’s performance is expected to continue improving,” she said.

The Kingdom chairperson said the depressed performance of the Zimbabwe Stock Exchange had negatively affected the performance of its stockbroking unit.

“The operation is strategic to the group offering and the current focus is capital preservation and being well placed to take advantage of an upturn in its nature of business,” Bango said.

She said the group had adopted a conservative position on its investment in First Discount House (FDH) of Malawi.

“The group has adopted a conservative stance….as the court process continues on determining the status of that asset on our statement of financial position,” Bango said.

AKFL is currently embroiled in an evaluation dispute of its 38,15 percent stake in FDH.

A Malawian arbitrator has valued the stake at $3,7 million, while AKFL is  gunning for a higher valuation of $10 million in the business.

“Differences over valuation have resulted in the transaction being referred to judicial review, the process of which is underway. Suffice to say, Kingdom is keen to ensure it gets value for its shareholders,” the group said earlier this year.

KFHL is the majority shareholder in FDH followed by Thompson Frank Mpinganjira Trust with 37,85 percent, Old Mutual Life Assurance Company (Malawi) with 19 percent and FDH employees with five percent.

The existing shareholders had made an unsuccessful $2 million bid for control of the group, which was denominated in the country’s local currency.

With the kwacha under attack and weakening against major currencies such as the American unit, the group’s Zimbabwean shareholders and founders rejected the offer since it would have translated into a loss for a stake acquired in green back.

KFHL earlier in the year had announced funds raised from the disposal of FDH would have allowed it to re-invest into its operations and further strengthen its financial position.

In February the local financial services concern concluded a deal with ABL in which the latter invested $9,5 million into the local financial institution.

The investment, enabled Kingdom’s banking arm to meet the Reserve Bank of Zimbabwe’s (RBZ) minimum capital requirements, while assuming a 35 percent holding in the group. – Daily News