Access Bank Botswana’s Managing Director (MD) Kgotso Bannalotlhe expresses the essential feature of the lender’s new chapter as the “World of Access Warriors”.
“It’s very exciting, scary, audacious and impactful,” he told a cadre of journalists soon after the business published a set of its full year results ended 31 December 2021 recently.
He has figured out that as a banker in management, he will get only one opportunity in a lifetime to grow a bank into a top bank; one that should be truly meaningful for Batswana. The bank he leads is now part of a pan-African bank with a global presence that is also beginning its chapter of a five-year plan after a remarkable 20 years of existence. Bannalotlhe considers it a significant coincidence that the Botswana business should also be starting its five-year strategy. He says it is energising to be a part of this chapter because Access is everything that Bannalotlhe wanted to create with BancABC Botswana.
But the previous majority shareholder wanted to exit the market and the exit presented an opportunity for the new majority shareholder, Access Bank PLC, which was a perfect fit in the sense that they do not only invest in banks but run and operate them. The impetus of financial strength formulated and propelled a strategy going forward. The mother company will also “mentor us in how to get that level of success Access Bank PLC has had to be the Number 1 bank in Nigeria”, Bannalotlhe said. “We decided from the time the transaction was announced that we would accelerate and close the transaction, doing it in one year regardless of impact on the income statement,” he told the media.
Management was very clear that the bank would move into a new era as Access Bank Botswana, and it took them just six months to close all conditions precedent to become Access Bank. The bank made a pledge that it would outwork anybody for the results that it wanted. By October 7th, Access Bank was fully licensed, all within six months. In November, the bank was fully rebranded and operating as Access Bank Botswana everywhere.
By the end of the same month, management convened a meeting with the new shareholder for discussions around a bold five-year strategy and how the local business would leverage off their history of success. “We began to execute the strategy in October and November alongside closing out technology integration, which was the remaining part that we needed to do for our integration,” Bannalotlhe said.
He then turned his attention to certain elements of the strategy that became visible starting last week. In the course of last weekend, Access Bank began upgrading its core banking platform to a higher version. We want to become a top bank in Botswana by 2027, the MD stated matter-of-factly, adding that the bank has been working on that for almost a year now. It is introducing a Deputy Managing Director to lead the execution and a lot of other things simultaneously. Bannalotlhe speaks with gumption because, as he said, they do not see modesty as a strength at Access Bank. The sheer size of its ambition is what drives them to make sure they achieve their aim. “We lead with execution and speed, investments and support,” he said. “We are clear about what it will take to be Number 1.”
The bank aims to become the largest bank in Botswana by customers. Said the MD: “We will lead with digital channels and make sure they are engaged and tied to our retail platforms.” He envisages garnering more than 700 000 customers, more than 500 000 of them actively engaged on the bank’s platforms. The idea is to ensure one in three transactions that happen in Botswana happen on its platforms in the course of its journey to becoming the Number 1 bank in Botswana by 2027.
“We look to achieve over P2 billion of revenue and more than 40 percent of that revenue to be from fee income with a healthy return to investors,” Bannalotlhe said of his vision. Access Bank is targeting Return on Equity of between 25 percent and 30 percent. Capital adequacy is earmarked at 20 percent against the 12.5 percent set by the regulator. “To do this we have the support of the Group and digital assets at our disposal,” the MD noted.
There are four key areas he specified with respect to this strategy. The first is expanding support to drive customer acquisition and dominate. The tactic here is to use agency banking and is something that Bannalotlhe said they have been working on and has been approved by the Bank of Botswana (BoB). But implementation had been delayed because the bank was revamping its core banking infrastructure that was completed last week. “We want to expand our branch and service center footprint across the country. We will be present everywhere where we think our customers need us to be. When our customer wakes up in the morning, wherever they are, they should not have to walk more than a kilometre to experience our services,” he noted emphasizing that they will do that through a combination of agency banking and service centers. “We are rolling out a suite of new ATMs. As I am speak to you, all our branches have cash deposit ATMs,” he said, adding that size and model of branch will be guided by the needs of each and every place. In addition, Access Bank Botswana has introduced virtual banking services where customers can reach a live person through WhatsApp.
Access introduced points of sale (POS) in the fourth quarter of 2021 and already has 350 such terminals working towards a target of 1000 by the end of June 2022. “We introduced instant card issuance,” said Bannalotlhe. “When you visit a branch, you walk out with your card already active.”
Another key point is providing best in class digital platforms and products leveraging off the capabilities of the Access Bank Group. Here the MD talked about Superior Retail Mobile Banking Platforms, Market Leading Corporate Online Banking Platforms and Market Relevant Tailored Solutions for women, the youth and SMMEs that Access already has. “We are talking of propositions relevant to different sectors, including women banking and youth banking,” he said. “Access perfected women banking and we have realised that women need a whole different kind of banking in the same way that we have private banking.”
The next area e turned his mind to was revenue diversification, growth and value capture. The bank wants to effectively mine existing partnerships for growth, creating a foundation for transactional income-led growth. Bannalotlhe said Access Bank has strong expertise in corporate and SMME banking. “We want to be a lot more diversified so that we can grow the business to capture different segments and new business lines,” he said, adding that Access will introduce more products like micro financing, custody banking and insurance brokerage.
The bank wants to build a digital ecosystem, leveraging off Alliance Banking and leading in payments. “We have partnered with the Government of Botswana on the Pula card,” the MD disclosed. “We had slow uptake because of COVID. We have extended that contract and are unlocking the ability to bank the next people that someone said are unbankable. We intend to have 500 000 cards issued.”
Access Bank’s retail asset base was P6 billion before growing by P500 million during the advent of covid. The bank wants to grow this to P14.5 billion in total assets. Access Bank Botswana also aims to become full service corporate bank by partnering with institutions to assist them give customers the same experience on the retail side.