Dr. Shepherd Fungura, CEO of ZB Financial Holdings (ZBFH), pictured at the CEO Africa Roundtable.
By Nyashadzashe Ndoro
Harare — ZB Financial Holdings (ZBFH) Group, a prominent Zimbabwean financial services provider, has experienced a substantial staff departure, with 98 employees leaving the company in the first half of 2024.
This significant attrition reflects the tough economic environment in the country where the group also reported a 60% decline in profit after tax, falling to ZWG1.06 billion.
The company attributed these challenges to erratic energy supplies, drought conditions exacerbated by El Niño, stringent monetary and fiscal policies related to the introduction of the Zimbabwe Gold (ZWG) currency, and various external economic pressures.
These factors have adversely impacted economic performance.
Despite the difficulties, the release of the 2024 Monetary Policy measures has introduced some market stability, allowing the group to seize emerging opportunities.
“Erratic energy supply, drought brought on by El Niño, strict monetary and fiscal policies intended to stabilize the newly launched Zimbabwe Gold (ZWG) currency, as well as external economic forces, all decreased economic performance.
“Our financial results for the half year ended 30 June 2024 reflect the Group’s resilience amidst a challenging economic landscape.
“Despite a 60% decline in profit after tax, the Group maintained profitable, posting a profit after tax (PAT) of ZWG1.06 billion in June 2024 from ZWG2.68 billion in June 2023,” ZBFH said in its financial results for the half year ended 30 June 2024.
The staff departures resulted from a combination of voluntary and compulsory disengagement schemes.
Out of the total, 62 employees opted for the voluntary scheme, while 36 were let go under the compulsory scheme.
The group’s workforce now comprises 995 employees.
ZBFH explained that the recent organisational restructuring, which included a job evaluation exercise, led to these changes.
The voluntary disengagement scheme was mainly taken up by employees nearing retirement, while the compulsory disengagement was necessary due to staff not fitting into the new organizational design.
“Following adoption of a new Structure supportive of the new business model and organisational design, the Group undertook a job evaluation exercise, closely linked to deployment of staff to fill all positions across the Group.
“As at 31 December 2023, this project had been completed.
“As the new Group Structure settled, the Group adopted a Voluntary Disengagement Scheme (VDS) which was taken up by 62 staff members, mostly those who were nearing retirement,” said ZBFH.
However, some staff members could not be accommodated within the new organisational design, thus necessitating a Compulsory Disengagement Scheme (CDS) which saw 36 staff members being disengaged.
Economic conditions in Zimbabwe, including high inflation, currency volatility, and drought, have significantly affected ZBFH’s performance.
According to the Zimbabwe National Statistics Agency (Zimstat), Zimbabwe’s monthly inflation rate rose to 0.4% in August 2024, driven by a slight depreciation of the local currency on the parallel market.
The annual inflation rate stood at 3.7% in August 2024.
Operating costs for ZBFH increased by 7% due to macroeconomic price rises, while deposits and related funding balances decreased by 9%.
Although the group’s total assets grew by 4% in real terms, earning assets fell by 7%.
Additionally, ZBFH subsidiaries ZB Building Society and ZB Reinsurance reported significant declines in profitability, with ZB Building Society’s PAT plummeting from ZWG260.420 million in 2023 to ZWG4.743 million in 2024, and ZB Reinsurance posting a net loss after tax of ZWG52.861 million.
Despite these setbacks, ZBFH remains focused on its medium-term strategy, emphasizing sustainable growth, digital transformation, and innovation.
Source – Nehanda Radio
