THE Deposit Protection Corporation of Zimbabwe (DPC) says the total US dollar assessed premium income rose nearly 74% to US$6,6 million last year owing to increased funding.
The increase is from US$3,8 million in 2023.
According to DPC, funding for the corporation is derived from premium levies, rentals, money markets and equity investment income.
Premium contribution rates for both ZiG and foreign currency (FCA) deposits remained pegged at 0,3% of annual average deposits eligible for premium assessment.
“Total assessed premium income for the year was ZiG25,7 million and US$6,6 million,” DPC said in its 2024 annual report.
It said the DPC FCA premium rate was aligned with the ZWG rate at 0,30%, in line with international best practices as outlined in the International Association of Deposit Insurers’ Core Principles for Effective Deposit Insurance System, with effect from December 31, 2023.
In 2024, DPC reported navigating an investment environment shaped by tight market liquidity and macroeconomic interventions from the Ministry of Finance, Economic Development and Investment Promotion and the Reserve Bank of Zimbabwe.
“Amid these dynamics, the corporation maintained a strategically diversified investment portfolio across real estate, equities, real estate investment trusts and money market instruments,” DPC said.
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“Notably, real estate positions provided a strong hedge against inflation and currency volatility, contributing to sustainable returns and supporting the long-term stability of the fund.
“In line with evolving market trends, DPC continues to explore alternative asset classes to enhance portfolio agility and resilience, and generate real returns.”
Despite these efforts, DPC recorded an inflation-adjusted surplus of ZiG123,3 million last year, down from ZiG187,04 million in 2023.
The downturn could be attributed to a net monetary loss of ZiG125,49 million experienced last year.
“Total income increased from ZiG254,97 million to ZiG264,12 million in inflation-adjusted terms. This positive performance was largely driven by premium income, which rose from ZiG157 million in 2023 to ZiG234 million in 2024,” DPC said.
“Other income sources, including rental income and investment returns, also contributed to overall income growth. The USD and ZiG premium rates remained at 0,3% per annum during the year under review.”
DPC added that operating expenses increased to ZiG84,2 million from ZiG71,6 million, due to the impact of business growth on the corporation’s cost base.
Despite the performance, DPC reaffirmed its ability to protect depositors’ funds.
The deposit protection cover levels for banking institutions were pegged at US$1 000 for FCA deposits and the ZiG equivalent for local deposits, per deposit class per contributory institution.
Consequently, 96,7% of FCA and 99,6% of ZiG depositor accounts at contributory banking institutions were covered in full.
DPC is committed to remaining steadfast in its commitment to advancing sustainable deposit insurance and adopting sustainable business practices into its core operations.
“We will continue to strengthen the resilience of the deposit insurance system by adopting innovative risk-based premium models, enhancing financial inclusion and promoting responsible banking practices,” DPC said.
“We foresee our sustainability strategy contributing towards reducing operational environmental impacts, fostering transparency and good governance and supporting financial stability through inclusive policies.
“By collaborating with fellow regulators, member institutions and stakeholders, we aim to build a more sustainable and equitable financial safety net that safeguards depositors, while contributing to long-term economic and social well-being.”
These efforts align with DPC’s vision of a stable, inclusive and future-ready deposit protection framework.
DPC’s fund size grew to US$15,2 million at the end of 2024, from US$7,8 million. in 2023.
