• NMB Holdings reported profit after tax of US$8.34 million for Q1 2026, up 231% from US$2.52 million, although the result includes a US$3.8 million non-recurring acquisition gain from the EFC Zambia consolidation
• The bank’s net loans and advances rose 27% to US$198.2 million, exceeding customer deposits of US$154.6 million by US$43.6 million, making its balance sheet one of the most aggressively deployed in the current banking results cycle
• EFC Zambia contributed US$1.8 million to operating income in its first consolidated quarter, giving NMB a regional MSME lending platform that could strengthen income diversification if execution holds through the next reporting periods

Harare- NMB Holdings, has reported profit after tax of USD 8.34 million for the first quarter ended 31 March 2026, against USD 2.52 million in Q1 2025, a 231% increase according to the latest trading update.

 Operating income grew 59% to USD 24.2 million, while total assets rose 15% to USD 390.8 million.

Net loans and advances expanded 27% to USD 198.2 million, and customer deposits grew 19% to USD 154.6 million. The group completed the acquisition of EFC Zambia during the quarter, marking its first significant regional expansion into the Zambian market.

The number that defines the analytical character of this result is not the 231% profit growth, which contains a USD 3.8 million non-recurring acquisition gain from the EFC Zambia consolidation because if we trip that gain out, underlying profit is approximately USD 4.54 million, representing underlying growth of approximately 80% on Q1 2025.

An 80% underlying profit improvement is genuinely strong performance. The non-recurring gain overstates it. Both are true simultaneously, and the distinction matters because investors pricing NMB on a recurring earnings basis need to work from the USD 4.54 million number rather than the USD 8.34 million headline.

The loan-to-deposit relationship is the central structural fact of NMB's Q1 balance sheet and the feature that most distinguishes it from every other banking institution reporting this quarter.

Net loans and advances of USD 198.2 million exceeded customer deposits of USD 154.6 million by USD 43.6 million. NMB is lending more than it is taking in deposits and bridging the gap through wholesale funding. Total funding of USD 280.2 million against total assets of USD 390.8 million implies a funding mix that relies on USD 92.9 million of equity and USD 280.2 million of liabilities, including the deposit base and other borrowed funds, to support the asset base.

The bank is using leverage aggressively to grow its earning asset base at a rate that pure deposit-funded growth would not support.

This inverted loan-to-deposit structure is analytically distinct from the peer group. First Capital Bank holds USD 214 million in deposits against USD 138 million in loans, a USD 76 million funding surplus. NMB holds USD 198 million in loans against USD 154 million in deposits, a USD 43.6 million funding deficit. The two banks are operating at nearly the same income scale, USD 24.2 million for NMB and USD 23 million for First Capital Bank, but from opposite balance sheet postures.

First Capital is under-deploying its funding, NMB is over-deploying its funding relative to its deposit base. The former compresses NII through excess liquidity. The latter generates maximum NII but creates refinancing risk if wholesale funding conditions tighten and asset quality risk if the rapid loan book expansion outpaces credit assessment capacity.

The loan book grew 27% in a single quarter, from USD 155.6 million to USD 198.2 million, a USD 42.6 million increase. That is a remarkable pace of expansion. EFC Zambia's consolidation contributed some of this growth, but the group also identified a strategic pivot toward core lending, specifically retail, SME, and productive-sector lending, in response to the fee income compression from RBZ's bank charge caps and removals.

The capital adequacy ratio of 24.30% against the 12% regulatory minimum, and shareholder equity of USD 92.9 million against USD 84.2 million at December 2025, confirm that the bank has the capital headroom to absorb the loan book expansion.

EFC Zambia contributed USD 1.8 million to operating income in its first consolidated quarter, representing 7.4% of the group total. The group's plan to leverage EFC's MSME lending capability through cross-border skills transfer is strategically coherent: MSME lending in Zambia and MSME lending in Zimbabwe share operational similarities including small ticket size, high transaction volume, relationship-based credit assessment, and the importance of technology infrastructure for portfolio management.

NMB's fintech subsidiaries provide the technology layer that can be scaled across both markets without proportionate cost increases. The strategic logic of the acquisition is sound. The financial contribution in quarter one is promising. The execution test is whether EFC Zambia's contribution grows as a percentage of group income over subsequent quarters as the Zambian MSME lending book matures under NMB's ownership.

ZB Financial Holdings, the third banking group reporting this quarter, offers a contrasting strategic picture. ZB's net earnings from lending declined due to zero-coupon TB reissuance and liquidity constraints, and its diversification across insurance and property partially cushioned that lending income loss. NMB's strategy is the inverse: concentrate on growing the lending book aggressively and use the deposit base and wholesale funding to support that growth.

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