BY FIDELITY MHLANGA LISTED financial services firm ZB Holdings posted a profit of $1,13 billion for the half year ended June 30, 2020 compared to $237,8 million in the comparative period in 2019 buoyed by growth in income. The group posted a real total income growth of 138% from $838,2m for the six months to June 30, 2019, to $1,99 billion for the six months to June 30, 2020. “This was on the back of gratuitous fair value credits and foreign exchange gains which, combined, contributed 79% of the total income, having increased by 574% from $232,9 million for the six months to June 2019 to $1,57 billion for the six months to June 2020,” said group chief executive Ron Mutandagayi. Gross interest income retreated in real terms by 21% from $255,2m for the half year ended June 20, 2019 to $202,7m for the same period in 2020 following a 16% reduction in the real value of interest earning assets. “Interest expenses reduced by 62% in real terms to $25,6 million for the half year ended June 30, 2020 compared to $66,9 million in the comparative period in 2019. This cost reduction was achieved on the back of changed deposit mix towards cheaper sources of funding with the whole funding book exhibiting price stickiness in the wake of a liquidity glut that predominated the market throughout the period,” Mtandagayi said. A 174% increase in loan impairment charges from $28,9 million during the first six months in 2019 compared to $79,4 million for the first six months of 2020 is reflective of the increased level of assets exposed to credit risk which grew from $530 million as at June 30, 2019 to $2 522,7 million as at June 30, 2020. Net income from lending and trading activities thus went down from $159,2 million for the half year ended June 30, 2019 to $97,7 million for the half year ended June 30, 2020. Spurred by the increased renewal of covers in foreign currency and the continual re-evaluation of the gross values of insured assets, gross premium income increased by 12% from $254 million posted during the first half of 2019 to $286,6 million during the same period in 2020. Insurance expenses comprising commissions, reassurance and retrocession premiums, benefits and claims, similarly increased by 40% from $165,3 million during the first half of 2019 to $230,7m in the same period in 2020. Mtandagayi said on aggregate, the insurance expenses ratio of 80% for six months to June 2020 compared to 65% in the comparative period in 2019 remained within an acceptable range with net insurance income declining from $88,7million for the half year to June 30, 2019 compared to $55,9 million for the same period in 2020. Banking commissions and fees retreated 23% in real terms from $334,1 million for the six months ended June 30, 2019 to $258,1 million for the same period in 2020 despite an 11% increase in the number of customers on the book over the comparative periods and fee rate adjustments implemented between July 2019 and February 2020. “Rate escalations were frozen from March 2020 as part of the measures implemented by the Reserve Bank of