Banking sector injects K12.3 billion into economy through loans, advances in Q1, 2023


About K12.3 billion in loans and advances have been disbursed by the banking industry in the first quarter of this year to 908, 633 customers.

The industry, through Banker’s Association of Zambia (BAZ), said 30 percent of customers were from rural areas while 70 percent were for urban areas.

Leonard Mwanza, BAZ Chief Executive Officer, said this at a Mid-Year Economic Performance and 2024-2026 Medium Term Budget Plan meeting in Lusaka on Tuesday.

“Of this disbursement K1.5 billion was to over 64,000 Small and Medium Enterprises (SMEs) and K5 billion to 842,950 households and individuals, K4.9 billion went to large businesses and the balance of K900 million went to the Agriculture sector.

“Of this number, 275,957 loans were disbursed to women lead businesses accounting for 30 percent, with a value of K1.5 billion or 13 percent of total disbursed in quarter 1 of 2023,” Mwanza said.

Read more: Banking sector critical to economic growth, Finance Minister says at stakeholders meeting

He said youths accounted for 42.6 percent (386,808) or K1.7 billion (14 percent) of total disbursements.

He reiterated that banks would continue in their efforts to support key sectors of the economy.

Mwanza stated that in the first quarter, 70.5 percent of total disbursed funds came from Commercial banks, while 21.2 percent was from Micro Finance Institutions and the remainder from other Nonbank financial companies (NBFCs).

He also said the sector continued to be resilient and posted satisfactory earnings performance for the half year and remains adequately capitalised.

According to Mwanza, the asset quality was good and Non-Performing Loans (NPLs) dropping below five percent at half year.

Some of the significant performance indicators outlined by Mr Mwanza included: Year on Year Profit After Tax, increasing by 58.2 percent, from K1.4 billion in 2022 to K2.2 billion as at end of the second quarter.

Others are Year on year Customer deposits growing by K25.8 billion, a growth of 21.6 percent to K145 billion from K119 billion recorded in 2022.

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