Finance

Zimbabwe: Banks still reticent to grant loans despite falling bad debts and record net profits

Monday, 19 November 2018 13:33

In H1, 2018, the Zimbabwean banking sector realized $176.1 million of net profit, according to data gathered by Ecofin Agency. This represents a record level for the period since 2014.

In addition, there was a significant decrease in the burden of bad debts in the loan portfolio. From the highest level of 20.45% reached in September 2014, it continually dropped to reach 6.22% which is the lowest level since 2011.

Despite these positive figures and a now open economy policy, Zimbabwean banks are still reluctant to grant loans. Consequently, the loan-to-deposit ratio is 43.5 %; the lowest level since June 2017 and below the central bank’s benchmark which is 70%. Some other indicators better explain this fact. Indeed, even though the ratio of bad debts is at its lowest level, it is above the benchmark which is 5%. In addition, credits to the economy, payment advances, and investments represent 62% of banks’ assets. Furthermore, 60% of the deposits are overnight deposits. In this economy that faces serious liquidity challenges, it is partly understandable why loan requests require good risk evaluation.

Idriss Linge

On the same topic
SETRAG seeks IFC loan for €704 million rail upgrade Phase III to replace 561 km rails by 2030 IFC flags environmental, social risks...
Ghana plans to exit the IMF program in April 2026. President Mahama says "We are living with dignity," citing improved inflation, reserves, and...
The Bank of Ghana created a steering committee and a technical committee to design a bank listing framework. Ghana’s pension fund assets exceed 100...
Proparco granted a CFA1.3 billion ($2 million) loan to VisionFund Senegal. Women represent 95% of VisionFund Senegal’s clients. VisionFund will use...
Most Read
01

Deposits grow 2.7%, supporting lending recovery Average loan sizes small, credit risk persists ...

Togo Microfinance: Deposits and Loans Rise Simultaneously in Q3 2025
02

Oil majors expand offshore exploration from Senegal to Angola Gulf of Guinea accounts for about 1...

Gulf of Guinea regains appeal as a key exploration hub for oil majors
03

MTN is considering buying back telecom towers it sold years ago, signalling that control of infras...

MTN’s Talks to Buyout IHS: A Strategic Reversal That Could Reshape African Telecoms
04

Rwanda, partners break ground on $2 billion Kigali Innovation City Smart city targets ...

Rwanda Mobilises Global, Local Finance for $2Bln Innovation City Targeting Africa’s Digital Economy
05

The BCEAO granted Semoa a level-3 “full service” payment institution license on January 27, 2026...

Togolese Fintech Semoa Wins Full-Service BCEAO License
Enter your email to receive our newsletter

Ecofin Agency provides daily coverage of nine key African economic sectors: public management, finance, telecoms, agribusiness, mining, energy, transport, communication, and education.
It also designs and manages specialized media, both online and print, for African institutions and publishers.

SALES & ADVERTISING

regie@agenceecofin.com 
Tél: +41 22 301 96 11 
Mob: +41 78 699 13 72


EDITORIAL
redaction@agenceecofin.com

More information
Team
Publisher

ECOFIN AGENCY

Mediamania Sarl
Rue du Léman, 6
1201 Geneva
Switzerland

 

Ecofin Agency is a sector-focused economic news agency, founded in December 2010. Its web platform was launched in June 2011. ©Mediamania.

 
 

Please publish modules in offcanvas position.