Banks buoyant in h1 

M

alawi Stock Exchange (MSE)-listed commercial banks have posted good results for the half-year ended June 30, despite a subdued economic environment occasioned by the rise in commodity prices following the devaluation of the kwacha.

Published financial statements from some of the banks, namely National Bank of Malawi plc, NBS Bank plc and Standard Bank plc, show that they posted higher profits than during the corresponding period last year.

A Standard Bank plc financial statement published on Friday shows that profits went up by 37 percent to K15.8 billion in the half year-ended June 30 2022, from K11.5 billion in the corresponding period in 2021.

Similarly, NBM plc, in its published statement on August 1, showed that profit-after-tax also grew to K22.1 billion profits in the half year period ended June 30 2022, up from K12.8 billion reported during the same period last year.

NBM plc linked the growth to net interest income which  increased by 48 percent and other incomes  which grew  by 13 percent.

Profitability of NBS Bank plc also grew by 16 percent to K5.1 billion in the half year ended June 30, up from K4.4 billion, on account of what the bank on Friday described as its flexibility in strategy implementation which enabled it to focus on high revenue generating activities.

Market analysts have also indicated that banks’ resilient performance is not surprising due to forex trade in the review period.

Commenting on the banks’ perfomance, Bridgepath Capital Limited chief executive officer Emmanuel Chokani observed that the profits have been buoyed by non-interest income mostly from forex trading and growth in loan book for some banks.

Bankers Association of Malawi chief executive officer Lyness Nkungula is on record as having said that banks have better business risk management that has helped them to sail through even in the turbulent times.

“The diversification of products and technology helps to intensify the resilience to the tough economic situations,” she said.

On the other hand, published statements from other sectors such as the telecoms sector, indicate thatTNM plc and Airtel Malawi plc are anticipating lower profits in the first half of this year.

The two firms said they incurred foreign exchange losses in the period under review due in part to the weakened kwacha.

Airtel Malawi plc has since forecast that profit-after-tax for the half year period will be lower than the same period last year because of the performance of the economy in the wake of the devaluation.

TNM, through its  company secretary Christina Mwansa, also indicated in a cautionary statement on June 30 2022 that its profit-after-tax for the first six months will be 130 percent lower than that of the same period last year on account of foreign exchange losses due to the devaluation.

Malawi Stock Exchange (MSE) operations manager Kelline Kanyangala said this points to a positive outlook, saying the market remains positive despite significant downside risks mainly emanating from the macroeconomic environment.