FDH Financial Holdings Group, a local diversified investments and financial solutions firm, has posted a K7.8 billion profit after tax for the year ending 31st December 2018, up from K94.6 million registered in the previous year.
A statement for the financial results for the period released March 18 2019 seen by Nyasa Times shows that the impressive performance is coming at the time when one of the group’s subsidiaries, FDH Bank posted an after tax profit of K5.9 billion in 2018 compared to a loss of K1 billion it registered in 2017.
“The Directors report a profit after tax of MK7.8 billion for the year ended 31 December 2018 from MK94.6 million reported in 2017. Total income grew by 28% from MK25.2 billion to MK32.3 billion,” reads the statement signed by Board Chairman Noel Nkulichi and Chief Executive Officer Thomson Mpinganjira.
The Group said it continued to invest in digital products and other distribution channels as the focus is to improve customer experience as well as diversifying sources of non- interest income.
“Notwithstanding the significant investment in the digital platform, distribution channels and staff development, operating expenses remained relatively constant between the two years. The Group will continue to put more focus on effective cost management as we continue to bring down the cost to income ratio to market levels,” reads the statement in part.
.On the operating environment, FDH Group said economic stability and growth continued to improve and improved weather conditions supported growth with primary sector activities including construction and agriculture standing out as the main drivers.
It also said monetary policy easing continued as inflation trended lower adding that the Kwacha was stable against major currencies and interest rates went down.
The group said in the run up to the elections in May, government policy and public spending is likely to be influenced by political factors and this may have negative effect on budget implementation with a wider budget deficit, which is likely to result in additional borrowing.
“However, The Group anticipates tight monetary policy to continue, the Country’s GDP to reflect the expected good harvest for the year, Inflation to be maintained at the lower level and the exchange rate to be relatively stable for much of 2019.”
“It is also expected that the recent drop of the base lending rates will spur credit growth with anticipation of economic growth. The Group’s focus is to continue improving and consolidating its non-interest income through its digital offerings and customer centric innovative solutions. Additionally, the Group will continue to prudently manage the credit risk which will result in significantly lower credit impairments going forward,” reads the statement in part.