Stanbic Bank Zimbabwe has been voted the best commercial bank for the second year in a row in the annual Banks and Banking Surveyconducted by some of Zimbabwe’s leading financial analysts.
The analysts ranked the country’s 19 banks on the “Strongest Bank matrix” based on the premise that the strongest banks in the country are those that have clearly robust domestic business franchise, reasonable profit levels, good asset quality and low risks to earnings and liquidity.
Basing their analysis on key financial services benchmarks such as size of the bank balance sheetrelative to the country’s Gross Domestic Product (GDP); balance sheet growth as represented by growth in loans and deposits, the analysist concluded that the Standard Bank subsidiary stands out in the local market.
The survey, whose theme was “Banking on Caution-Dealing with Rising Currency Risk” also took into consideration the banks’ funding liquidity touching on liquid assets to total deposit and borrowings.
“When all has been said and done…The analysis suggests that Stanbic is the most prominent bank in the country measured by all the relevant matrices. Standard Chartered and CABS are in second and third positions respectively,” wrote the analysts.
The analysts looked at the risk profile metrics namely loan-to deposit, capital adequacy and operating profits to total income. They analysed profitability touching on ROE, ROA, Cost-to-income and non-funded to total income.
Domestic franchise as represented by market share of deposit and asset quality as represented by non-performing loans to total loans also formed part of the metrics which saw Stanbic Bank coming tops.
Stanbic Bank came out top based on its strength and soundness as measured by its capital base and its quality.
The analysts acknowledged that this survey was done at a time when risk is the most pervasive issue affecting the banking industry.
They acknowledged that a litany of challenges such as cash availability, bond notes, foreign currency obligations, digitisation and cyber, treasury bills, Non performing loans (NPLs), and regulatory interventions all have risk as the common factor.
They noted that theprevailing cash and foreign currency crisis has taken centre stage this year.
“Taking cost to income ratio (CIR) as a proxy for efficiency, Stanbic takes the cake at 56% among the big banks,” said the analysts.