contents REPORTS Table of I PAGE ~lsslon, ~ l o n values , 3 F l t Statements: Profff and Lass account 22 Balance Sheet 23 24 h
History, Ownership Hlstory Zambia National Commercial Bank PIC(7anacoM) was established in 1969 to servlce the financial needs
Mission, Vision, Values MISSION T o consistently exceed stakeholder expectations in proactively designing, selling, delivering
Products CREDIT FACILITIES Trade finance Working capital Term loans Project finance Syndicated loans TREASURY AND INVESTMENTS F
Financial Highlights FINANCIAL HIGHLIGHTS Loens and Ildrmcee -- -- - Revenue - - - - Total Assub Profit 1 Net Interest Revemu -
Board of Directors Arnold J.A.M. Kuijpers Non-Executhre Director Mr. Kuijpers, aged 55, I s Managing Director of Rabobank Finan
Managerrlent M Wiessing Managing Director S Katowa Director - Corporate Support D Kaunda Director - Human Resources A Molenkamp
Chairman's Statement Once again Zambia National Commercial Bank P L C (Zanaco)has had a momentous year, a year capped by improv
Chairman's Statement Continued The key metrics inciude revenues up by 34%. cost to income ratio down to 70%, profit before tax
Managing Director's Statement The year 2008 saw the implementation of many initiatives the Management Team had set in motion ea
Managing Director's Statement Continued launch of corporate and retail Internet banking modules from a low base of 35 A T M s i
Managing Director's Statement Continued The PBT number is therefore perhaps more illustrative of the true operational improveme
Directors' Report 'The directors submit their report together with the audited financial statements for the year ended 31 Decem
Directors' Report Continued RELATED PARTY TRANSACTIONS Related party transactions are disclosed in Note 31 of the financial sta
Statement on Corporate Governance Directors' responsibilities The Directors are required to maintain adequate accounting record
Statement on Corporate Governance Continued Board Meetings The Schedule of Board Meetings Is agreed at the beginning of the yea
Statement on Corporate Governance Continued Loans Review Committee This committee comprises two(2) Non-Executive Directors and
Statement on Corporate Governance Continued Policies Anti-Money Laundering Policy The Bank has enhanced its money laundering pr
Statement o f Directors' responsibilities The Companies Act requires the directors to prepare financial statements for each yea
Repot of the Auditors Report on the financial statements W e have audited the accompanying financial statements of Zambia Natio
Financial Statements Profit and Loss account Year ended 3 '1 -December 2008 Notes K million Year ended 3 1-December 2007 Restat
Balance sheet A t 31 December 2008 K million A t 31 December 2007 K million Restated Notes A S S E T S Cash and balances with B
Financial Statements Statement of changes In equity Share capital K million Balance at 1 January 2007 Revaluation surplus Defer
Financial 'Statements Cash flow statement Notes Cash flows from operating activities Interest receipts Interest payments Net fe
Financial Statements notes 1 General information The Bank is incorporated in Zambia under the Companies Act as a limited liabil
Financial Statements notes continued rate is the rate that exactly discounts estimated future cash payments or receipts through
Financial Statements notes continued Loans, advances and receivables and held-to-maturityfinancial assets are carried at amorti
Financial Statements notes continued geographical location, collateral type, past-due status and other relevant factors). Those
Financial Statements notes continued The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at
Financial Statements notes continued (k) Cash and cash equivalents Cash and cash equivalents includes cash in hand, deposits he
Financial Statements notes continued (0) Sale and repurchase agreements Securities sold subject to repurchase agreements ('repo
Financial Statements notes continued such as credit risk (bothown and counterparty),volatilities and correlations require manag
Financial Statements notes continued are collateralised by the underlying shipments of goods to which they relate and therefore
Financial Statements notes continued Management Is confident In its abillly to contlnue to control and sustaln mlnlmal exposure
Financial Statements notes continued Loans and advances past due but not impaired Loans and advances less than 90 days past due
Financial Statements notes continued Economic sector risk concentrationswlthin the customer loan and deposit portfolios were as
Financial Statements notes continued At 31 December 2008 Liabilities Deposits from banks Deposits due to customers Borrowed fun
Iirlancial Statements notes continued (d) Market risk Market risk is the risk that changes in market prices, which include curr
Iirlancial Statements notes continued lnterest rate risk The Bank takes on exposure to the effects of fluctuations in the preva
Iirlancial Statements notes continued (e) Capital management The Bank's objectives when managing capital, which is a broader co
Financial Statements notes continued 2008 K million 2007 K million Tier 1 capital Tier 1 Tier 2 capital + Risk-weightedassets O
Financial Statements notes continued 8 Employee benefits expense The following items are included within employee benefits expe
Financial Statements notes continued 11 Cash and balances with Bank of Zambia 2008 K million 2007 K million Cash in hand Other
Financial Statements notes continued 'The movement in investment securiies available-for-salemay be summarised as follows: 2008
Financial Statements notes continued Personal Overdrafts K million At January 2008 Provision for loan impairment Write- offs Re
Financial Statements notes continued 16 Investment Properties K million Year ended 31 December 2007 Cost Valuation Net book amo
Financial Statements notes continued The deferred income tax asset, deferred income tax charge/(credit)in the profit and loss a
binancia1 statements notes continued 19 Customer deposits 2008 K million 2007 K million Current and demand deposlts Savings acc
Financial Statements notes continued T h e movement in the fair value of the plan assets is as follows: 31 December 2008 K mill
Financial Statements notes continued Opening net asset not recognised Net charge for the period Contribution paid - current yea
Financial Statements notes continued Movement in provision for retirement At start Provision Payment At closing 2008 K million
Financial Statements notes continued The balance in the general banking reserve represents the excess of impairment provisions
Financial Statements notes continued 28 Off balance sheet financial instruments, contingent liabilities and commitments In comm
Financial Statements notes continued 29 Analysis of cash and cash equivalents as shown in the cash flow statement 2008 K millio
Financial Statements notes continued Placement with shareholder 2008 K million 2007 K million Placement with Rabobank lnterest
Financial Statements notes continued 32 Segmental reporting Business segments T h e Bank comprises the following main business
FinanciaT 'Statements notes continued Business segments as at 31 December 2007 Net interest Net fee and commission income Other
Financial Statements F i e year financial trend Interest lncome Interest expense Net Interest lncome Commission and other lncom
Branch Network and ATM locator Contacts HEAD OFFICE Zambia National Commercial Bank Pic Plot 21 18/21 19, Cairo Road P 0 Box 33