Profits of Mozambican banks fell by 21.9% in 2024, to around €900,000 per day, according to data from the Bank of Mozambique in its June financial stability report.
The central bank explains in the document that the reduction in the banks’ net profits, which totalled 24 billion meticais (€319.4 million), is the result of “an increase in operating costs, particularly personnel costs, by 7.88%”, but also “of a reduction in other operating results, reflecting a 44.60% increase in impairment losses”.
In 2023, the profits of Mozambican banks had grown by 8.12% compared to the previous year, the document recalls, adding that, in the 2024 result, 64.63%, equivalent to 16.82 billion meticais (€223.8 million), correspond to only three domestic credit institutions classified as systemic. These are Banco Comercial de Investimentos (BCI), owned by the Portuguese Caixa Geral de Depósitos, the South African bank Standard Bank and Banco Internacional de Moçambique (BIM), from the Portuguese group BCP.
The non-performing loan ratio (NPL ratio) of the Mozambican banking sector “remains above the conventionally accepted limit (5.00%), having stood at 9.32%, after 8.23% in 2023”, while the NPL coverage ratio stood at 60.29% in 2024, compared to 66.02% in 2023, the central bank points out.
“The banking sector remains profitable and with adequate levels of capitalisation, liquidity and profitability, despite the reduction in asset quality”, the report states, adding that, in 2024, the overall solvency ratio stood at 26.11%, “above the regulatory minimum of 12.00%”.
On the other hand, the short-term liquidity coverage ratio stood at 49.64%, also above the regulatory minimum of 25%.
The document also states that the Return on Assets (ROA) and Return on Equity (ROE) ratios of Mozambican banks were set at 3.38% and 13.91% in 2024, respectively, against 4.66% and 19.11% in 2023.
There are 15 commercial banks and 12 micro-banks operating in Mozambique, in addition to credit cooperatives and savings and credit organizations, among others.
