BCI, Millennium bim and Standard Bank accounted for 75% of bank profits, which totalled 30.8 billion meticals (481.9 million dollars) in 2023. This result represents an increase of 8.1 per cent over the previous year, according to data from the Bank of Mozambique (BoM).
According to information from Lusa, the BoM’s 2023 financial stability report highlights that this growth is mainly due to an increase in other operating income of around 6 billion meticals (93.2 million dollars) and in net interest income of 2.3 billion meticals (35.2 million dollars).
‘The banking sector remained profitable and stable, with adequate levels of capitalisation, profitability and liquidity during the period under review,’ says the report. However, asset quality, as measured by the non-performing loans (NPL) ratio, stood at 8.24 per cent, above the defined level of 5 per cent, despite the downward trend in recent years.
The document states that the three banks mentioned were responsible for 22.8 billion meticals (356.7 million dollars), corresponding to 73.9 per cent of the sector’s total profits. ‘The banking sector’s solvency ratio was 25.67 per cent in 2023, significantly above the regulatory minimum of 12 per cent, accommodating the conservation reserves of the systemically important banks,’ the note reads. The document also mentions that, at the end of 2023, the banking sector’s liquidity remained at satisfactory levels, standing at 47.42 per cent, well above the regulatory minimum of 25 per cent.
“The banking sector’s assets grew by 7.27 per cent to 918.5 billion meticals (14.4 million dollars), driven mainly by the increase in deposits and resources from other credit institutions. However, credit to the economy contracted by 2.45 per cent in 2023,’ adds the report.
The report also points out that the concentration of the banking sector, measured by the shares of assets, deposits and credit, continues to decrease, signalling greater competitiveness in the market. Currently, around 15 commercial banks operate in the country.
“In December 2023, investments in Mozambican credit institutions fell by 79.4 billion meticals (1.2 million dollars), a drop of 40.1 per cent compared to the same period in 2022. This reduction was essentially due to the decrease in investments at the Bank of Mozambique and deposits at credit institutions, both at home and abroad, which fell by 39.62 per cent and 49.05 per cent respectively,’ the document explains.
The report concludes by emphasising that capital adequacy indicators remained at historically high levels, with the aggregate solvency ratio standing at 25.67%, 13.67 percentage points above the regulatory minimum, after reaching 26.77% in 2022.
