17 Dec 2014

Loans to resident businesses increased by P591 million as total credit extended by commercial banks increased by 0.9 per cent between August and July, statistics from Bank of Botswana state. 


According to information from the central bank, credit to non-residents and households decreased by P22 million and P176 million respectively. 
 Within the resident businesses category, credit to parastatals increased by P108 million or 4.5 per cent. 


The bank states that year-on-year credit growth increased slightly from 14.2 per cent in July to 14.4 per cent. “This was due to an increase in business credit growth from 10.4 per cent to 17 per cent, while that for households declined from 17.3 per cent to 12.5 per cent,” says the report. 


The share of credit to the household sector fell from 56.5 per cent the previous month to 55.6 per cent in August, it is stated.  
It is said foreign exchange reserves decreased by three per cent from P77 654 million in July to P75 469 million. 


“Based on changes in the reserves, adjusted for unrealistic gains and losses, the balance of payments was in overall deficit by P2 357 million in August, while for the year to date, the surplus was P8 164 million,” it is stated. 


In the exchange rates, in August the Pula depreciated against the USD, Pound and Euro by 4, 1.8 and 0.2 per cent respectively while appreciating against the Rand, 1.6 per cent and the Yen, 1.5 per cent. 


On an annual basis, the Pula depreciated against the Pound (8.5 per cent), US dollar (7.8 per cent), Euro (2.0 per cent) while appreciating against the Rand (4.1 per cent) and the Yen (2.3 per cent) respectively. 
 Net foreign assets of the banking system increased by P358 million to P82 566 million. 


The central bank states that this reflects an increase in claims on non-residents by P1 231 million which was partially offset by an increase in liabilities to non-residents by P873 million. 


Claims on non-residents by the bank decreased by P2 185 million while those of other depository corporations increased by P3 415 million.
 Commercial banks deposits increased by P3 114 million or 5.9 per cent in August to P56 178 million buoyed by deposits of households and resident businesses. 
 Deposits for non-resident businesses, central and local government decreased by P6 million, P55 million and P58 million respectively. 


The central bank states that businesses accounted for 73.8 per cent of total deposits compared to 22 per cent for households. 
It is said there were increases in current, savings accounts and deposits fixed up to three, six and over 12 months. 


Meanwhile, inflationary commentary from Statistics Botswana shows that inflation has remained constant at 4.3 per cent for October and November. 
 

Commentators expect the rate to remain within the Bank of Botswana inflationary objective range for the remainder of the year, especially following reduction of fuel pump as international oil prices have been declining for most of the year. ENDS