- Profit after tax up 145 percent to P3.3 million
- Fees and commission grew by 105 percent
In the face of a challenging operational landscape, Botswana Savings Bank (BSB) perseveres in achieving a notable enhancement in its financial performance.
For the six months concluding in September 2023, the bank witnessed a remarkable surge, with its profit after tax escalating by an impressive 145 percent to reach P3.3 million, in stark contrast to the figures recorded in September 2022.
“This was achieved through fee and commission income performance, which grew by 105 percent year on year with the growth coming from improving savings accounts performance. Interest income was P162.5 million, up nine percent annually, reflecting the benefits of the increases in the Monetary Policy Rate by the Bank of Botswana in May, June and August 2022. September 2023 had the full benefit of the rate increases compared to September 2022,” the board said.
Nevertheless, BSB observed that the ongoing surge in interest rates has adversely affected its loan portfolio. This has led to customers falling short of the bank’s affordability criteria, consequently constraining the expansion of the loan book—BSB’s main revenue source.
Additionally, the bank’s total expenses are five percent higher year-on-year while costs increased in support of BSB’s digitisation journey with a focus on opening 200 new agency branches and launching a digital banking solution.
“Further included in the expenses is the investment in various IT solutions intended to safeguard the bank’s cyber security framework,” BSB explained.
It noted that it continues to maintain a resilient liquidity position over the period with a strategic focus on short-term money market placements over fixed deposits. Furthermore, capital raised from the bond market is expected to gradually reduce the holding of expensive volatile deposits. On its future outlook, the Board noted that with the bank having made significant investments in new products and channels, its focus is on growing the loan book and servicing clients in under-banked areas of Botswana.
“This will be achieved through the continuous roll-out of our agency banking channels. Through partnerships, our target is to have 200 active agent banking sites, offering everyday banking solutions to the larger population including those in remote areas by the end of the year,” it said. Botswana Savings Bank was established by an Act of Parliament, the Botswana Savings Bank Act of 1992, as a wholly-owned financial institution of the Botswana Government to provide banking and financial services for all people in Botswana.
