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NEW FNB HEADQUARTERS COST ABOUT E25M IN PROFITS

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MBABANE – The newly constructed FNB Eswatini headquarters in Ezulwini has led the bank to be E25-E26 million behind in profits, but it was a worth-it investment.

FNB Chief Executive Officer (CEO) Dennis Mbingo has revealed that when the financial year results for bank comes out in June; they would be at least E25-E26 million behind, due to the construction of the new building in Ezulwini. In an in-house interview published on the bank’s social media platforms, Mbingo stated that it was the correct decision for the bank to make as they would leverage this building and become more accessible as a bank. He said they would also look into other businesses going forward. The CEO stated that their mandate as the management of the bank was not to chase big profits every year, but to focus on being sustainable and growing.

The over E200 million three-storey building commenced in 2021 and was completed in 2023. The bank’s half-year results issued in March 2024, showed profit before tax to have increased by 15 per cent to E174.9 million when compared to the E152.6 million recorded in 2022. According to the bank’s abridged interim financial results and interim dividend declaration for the six months ended December 2023, the above profits indicated a 20.3 per cent return on equity (2022: 18.6 per cent). This continues FNB Eswatini’s track record of delivering robust shareholder returns and strong earnings. The bank reported that the 14 per cent increase in its loan book to E3.9 billion (2022: E3.4 billion) helped lift net interest income contribution by 9 per cent, compared to the December 2022 half-year results.

The bank’s customer base continued to increase usage of the bank’s digital platforms, and the combined growth in active customer numbers and transaction volumes is reflected in the 17 per cent increase in non-interest revenue recorded in December 2023. This was reportedly a significant improvement considering that price adjustments during the reporting period were well within reported inflation. The bank said it would continue to identify measures to improve affordability as digital migration continues. It said quality of lending would remain a priority, despite some indicators of strain in consumer capacity to borrow, impairments of loans and advances have been managed within acceptable levels, with E12.3 million charged against income for the half-year, compared to a similar number in the previous reporting period (2022: 12.4 million).

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