24 Sep 2017

Barclays Bank Botswana has announced a profit before tax of P249 million with revenue remaining flat in the first half of the year across segments with the exception of business banking that registered a five per cent growth in income year on year.

Announcing the bank’s half year ended results for June 30 2017, Barclays Bank Botswana finance director recently, Mr Mumba Kalifungwa said net fees and commission income grew by seven per cent to P160 million.

He said the growth was driven mostly by the bank’s retail and business banking segment where there was an increase in transactional and activity fees from their various digital channels such as point of sale machines that continued to drive issuing and acquiring income upwards.

“Operating costs were well contained and came flat in comparison to the same period last year.

Our cost efficiencies resulted in an overall cost to income ratio of 52 per cent for the reporting period, which is below the banking industry market average of 60 per cent as prevailed in the first few months of the year,” he said.

Mr Kalifungwa noted that prudence in incurring operating expenditure continued to be at the heart of their strategy agenda as they looked into  growing the business.

“Impairments increased by 1 per cent in comparison to the prior period ended June 2016. This stable performance is attributable to our enhanced collection capability and conservative credit extension,” he continued.

He further said that their loan loss rate averaged 1.84 per cent over the period in comparison to the banking industry market average of 7.5 per cent.

“It is however gratifying to note that in comparison, the second half of 2016, profits have grown by P25million or 11 per cent. We anticipate a stronger second half of the year 2017 as momentum in our key business segments starts to pick up in earnest,” said Mr Kalifungwa.

He indicated that the balance sheet registered a four per cent growth as compared to the same period last year.

“Our focus in the short and medium term is to optimise our balance sheet while focusing on revenue generating opportunities,” he concluded.

For her part, managing director of Barclays Bank Botswana Ms Reinette van der Merwe said the bank delivered results that underscore their resilience as a business.

“These results were realised in the midst of various external challenges such as the slowing economic growth to 0.8 per cent in the first quarter of 2017, declining credit growth across the sector, low interest rates and a general slowdown in the recovery of commodity prices,” she said.

She said these challenges did not deter them from their ambitions to be the bank of choice in Botswana and the bank continued to make progress in supporting key segments in various sectors of the economy.

“We are excited by the transformative journey that we are undertaking. As we embrace our destiny as part of a pan African group, we also take cognisance of the opportunities that it presents for us and our stakeholders,” she said.

The bank credits its growing balance sheet to year on year growth of nine per cent in customer deposits which were mainly driven by growth in short term funding.

“We are confident that our solid client partnerships and strong innovations will continue to drive positive momentum, as we execute our strategy. We are excited about the future of Barclays Bank of Botswana and given the evolution of our business we remain optimistic of the prospects that lie ahead,” said Ms Van der Merwe. ENDS