Mozambique: Banking sector profit doubles in 2006

28 November 2007

Maputo, Mozambique, 28 Nov – Profit at Mozambique’s nine retail banks increased two and a half times in 2006, benefiting from the growth of the economy and banking activities, according to a report recently published in Maputo.

Last year, according to the document drawn up by the Mozambican Bank Association (AMB) and consultancy KPMG, the nine retail banks operating in Mozambique posted total profit of 2.3 billion meticais, or 145 percent more than in 2005.

Only Banco Mercantil e de Investimentos (BMI) did not post a profit last year.

BIM bank, owned by Portugal’s Millennium BCP, posted growth in profit of 259 percent, to 1.6 billion meticais, and tehs econd-largest bank, BCI-Fomento posted profit of 512 meticais, or 143 percent more than in the year-ago period.

The biggest growth in profit (365 percent) was posted by the International Commercial Bank (ICB), which is Malaysian owned, which had profits of just 7 million meticais.

BIM remains the largest Mozambican retail bank, with assets of 24.7 billion meticais (a fifth more than in the previous year), which compares with the 7.67 billion meticais of assets at Banco Fomento.

The banks also benefited from a rise in benchmark interest rates and spreads, related to the decision by the Mozambican central bank to impose a conversion of loans in foreign currency into meticais, which have a higher interest rate.

The authors of the study also noted the “more prudent” intervention of the central bank in the financial market, as well as improvements in management of retail banks, as important for the general improvement of banking performance. (macauhub)