Mbabane- Nedbank Eswatini’s operating costs jumped by 19.1 per cent to E237.5 million in the first half of 2026, putting pressure on the bank’s efficiency even as stronger lending and non-interest income helped push headline earnings to E73.7 million.
The increase in costs was highlighted in the bank’s commentary on its financial performance for the six months ended June 30, 2026, which showed that expenditure grew considerably faster than total income during the period.
According to the bank’s financial report,,l total income increased by 11.1 per cent from E340.7 million to E378.4 million, while operating costs rose from the previous year’s level to E237.5 million.
The bank’s efficiency ratio consequently moved to 62.8 per cent, a development that management said had prompted a renewed focus on strict cost containment and initiatives aimed at generating additional revenue.
Despite the cost increase, the bank reported a 16.6 per cent rise in headline earnings, from E63.2 million in the first half of 2025 to E73.7 million in the corresponding period this year.
The earnings growth was supported by an expansion in the bank’s lending business, with loans and advances to customers increasing by 7.6 per cent to E4.9 billion.
Nedbank said the increase in lending, together with a larger asset base and the effective use of customer deposits, helped lift net interest income by 8.3 per cent to E241.8 million.
The bank also reported stronger performance outside its interest-earning activities, with non-interest revenue increasing by 16.3 per cent to E136.6 million. Nedbank attributed the growth partly to its continued drive to increase the use of its digital platforms.
At the same time, the bank’s credit costs eased during the period. Loan impairment charges fell from E57 million to E42.6 million, which Nedbank attributed to improved credit-risk management and stronger debt-collection strategies.
Customer deposits, meanwhile, increased by 3.5 per cent to E6.4 billion, which the bank said reflected continued customer confidence and provided a healthy funding base for its operations.
With expenditure emerging as a pressure point, Nedbank said it would focus during the remainder of the year on cost control while continuing to pursue growth.
The bank noted it planned to accelerate digital-channel adoption, deepen customer relationships and balance cost containment with long-term growth opportunities.
Despite the rise in costs, the financial institution reported a capital adequacy ratio of 13.07 per cent at the end of June, well above the regulatory minimum of 8 per cent.
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