The Infrastructure Development Bank of Zimbabwe (IDBZ) says high borrowing costs coupled with persistent liquidity shortages continue to hamper the institution’s ability to secure projects funding, resulting in missed targets.
For nearly two years, the Reserve Bank of Zimbabwe has maintained the policy interest rate at 35 percent in an effort to contain inflation.
While the measure has helped stabilise prices, it also has tightened access to credit for productive sectors of the economy.
In its financial results for the year ended 31 December 2025, the government-owned infrastructure financier said the difficult market conditions had constrained its capacity to mobilise long-term capital.
“High interest rates, tight liquidity and limited availability of long-term capital in the market constrained the bank’s resource mobilisation for infrastructure development,” IDBZ said.
The bank said that further complicating efforts to attract resources was a lack of viable projects ready for financing.
“The bank is therefore scaling up its efforts to develop a diversified pipeline of commercially attractive projects to bankability in collaboration with government, project promoters and development partners,” the institution said.
As a consequence of these pressures, the bank’s overall operations remained subdued during the reporting period.
During the period under review, the institution’s total assets declined by three percent to ZiG1.32 billion, largely due to weak growth in the loan portfolio amid constrained market liquidity and rising impairment levels.
It incurred an operating loss before tax of ZiG532 million, reversing the ZiG239.8 million profit posted in previous financial year.
The loss, according to the bank, stemmed mainly from loan write-offs amounting to ZiG101 million, coupled with a sharp rise in operating expenses, which climbed to ZiG435.3 million from ZiG228.8 million in 2024.
Net revenue fell significantly to ZiG81.7 million from ZiG221.1 million recorded a year earlier, reflecting weaker income generation as lending activity slowed.
Despite the difficult economic environment, the bank completed several housing developments, including Waneka Phase III and Mabuto Villas.
However, income generated from housing projects dropped sharply to ZiG44 million, down from ZiG184.3 million in the previous year, indicating slower activity within the property segment.
Meanwhile, IDBZ revealed plans to establish a US$50 million horticulture investment fund designed to improve climate resilience and strengthen export-oriented agricultural value chains.
The initiative is expected to directly and indirectly benefit more than 150,000 people, particularly women and young people.
“The facility, which will blend concessional resources from the Green Climate Fund with co-financing from other development partners, public sources and the private sector, seeks to strengthen resilience in high-value export chains including coffee, citrus, avocado, berries, and fresh produce,” the bank said.