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The four largest of Mozambique’s commercial banks account for almost 98 per cent of the profit in the country’s banking sector, according to the latest research undertaken by the consultancy firm KPMG and the Mozambican Association of Banks (AMB).
The research looked at 16 banks, and found that almost all the banking profits were concentrated in four of them – namely Millennium-BIM (International Bank of Mozambique), BCI (Commercial and Investment Bank), Standard Bank and Barclays Mozambique. Taken together, they made 98 per cent of all banking profit recorded in 2016, leaving just two per cent for the other 14 banks.
In absolute terms, banking profits in 2016 were 7.933 billion meticais (about 130 million US dollars). Of this, 7.762 billion meticais was concentrated in the big four, and 171.4 million meticais in profit was spread among the other 14.
The situation is not quite so extreme when it comes to deposits. There were 323 billion meticais worth of bank deposits in 2016. 78 per cent (250.2 billion meticais) of deposits were in the top four banks and 22 per cent (72.8 billion) in the other 14.
The picture is much the same for total banking assets. The research put these at 436.5 billion meticais, 76 per cent of which were held by the four largest banks.
Despite the severe economic crisis that gripped Mozambique in 2016, the banks did extremely well. The liquidation of one very small bank (Nosso Banco) and intervention by the central bank in a second (Moza Banco) were very much the exception, and these two banks were excluded from the research. Taken as a whole, the 16 banks considered rode out the crisis with apparent ease, with an overall growth rate of 26 per cent.
The solvency rate for the 16 banks, taken as a whole, was 18 per cent (up from 17 per cent in 2015), well above the minimum stipulated by the bank of Mozambique. The loan-to-deposit ratio was 82 per cent, compared with 80 per cent in 2015.
The weight of non-performing loans in the banking system worsened. The percentage of bad loans rose from four to six per cent of the entire credit portfolio.
The number of bank branches in the country rose from 616 in 2015 to 637 in 2016 – but the bulk of these are concentrated in the major cities and there are still many rural districts that have no banks at all.Source: AIM
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