MBABANE – Nedbank Eswatini Limited has delivered a solid financial performance for the year ended December 31, 2025.
This performance was underpinned by strong growth in lending activity, rising customer deposits and improved revenue streams, despite mounting credit risk pressures in a high interest rate environment.
The bank reported headline earnings of E212.1 million, up from E202.0 million in 2024, reflecting a 5 per cent increase.
This represents a steady increase driven primarily by a 9.7 per cent rise in total revenue. The performance reflects continued resilience in the country’s banking sector, as well as sustained confidence from both retail and corporate clients.
At the core of this growth was a notable expansion in the bank’s balance sheet. Loans and advances to customers rose by 13.0 per cent to E4.5 billion, compared to E4.0 billion in the prior year. This increase signals heightened lending activity across key sectors of the economy, suggesting improved demand for credit as businesses and consumers position themselves for growth.
On the funding side, customer deposits surged by an impressive 22.3 per cent to E6.1 billion, up from E5.0 billion in 2024. This sharp rise highlights growing trust in the bank and a strong liquidity position, providing a solid base for continued lending expansion.
Net interest income, which remains the backbone of the bank’s earnings, increased by 6.6 per cent to E462.2 million from E433.4 million in the previous year.
This growth was largely supported by the expansion of the bank’s asset base, driven by increased lending and the availability of excess funding from deposits.
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… rising impairments signal growing credit risk
MBABANE – The financial results were not without challenges.
One of the most notable concerns was the sharp increase in the impairment charge for loans and advances, which rose to E61.1 million from E24.4 million in 2024. This significant increase reflects heightened financial stress among certain customer segments, largely due to the prevailing high interest rate environment. As borrowing costs rise, both households and businesses face increased pressure to meet their debt obligations, leading to a higher risk of default.
Despite this, the bank has indicated that it is strengthening its credit risk management frameworks and collection strategies to mitigate potential future losses. This proactive approach will be critical in maintaining asset quality in an uncertain economic climate.
Operating expenses increased by 8.3 per cent to E375.0 million, compared to E346.3 million in the previous year. The rise in costs was mainly driven by inflationary pressures, as well as continued investment in technology and operational improvements.
These investments are aligned with the bank’s broader strategy to enhance efficiency, improve customer experience and drive digital transformation. Encouragingly, the bank’s efficiency ratio remained relatively stable at 52.3 per cent, slightly improving from 53.0 per cent in 2024. This stability suggests that while costs are rising, they are being effectively managed relative to income growth, reflecting disciplined cost control measures.
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