Rand Merchant Bank Botswana (RMBB) has built a war chest that they are ready to ‘dish’ to deserving emerging mining projects.
RMBB is an investment and corporate banking arm of First National Bank Botswana (FNBB), a leading commercial lender in the country. “There are a number of new mining projects coming especially those that do not source funding from parent companies outside the country,” said Pauline Motswagae, head of RMBB. She was speaking to sister publication BG Investor on Wednesday. ”These are projects we are targeting.” Perhaps as a sign that the firm is prepared to open its purse for junior miners, RMBB debuted at Botswana’s premier resources conference last month (June). The conference brings together mining firms who update stakeholders on their various projects. In Botswana, mining firms, especially in the coal and diamond sectors are at various stages of production and exploration. Khoemacau Copper Mining, a copper mid-tier with assets near Gantsi will apply for a mining licence with the mines department in September this year.
Tlou Energy, Kimberly Diamonds, African Energy and Shumba Coal are also at an advanced stage of operations and exploration. Motswagae did not divulge to BG Business the companies they are targeting. Furthermore, RMBB is interested in funding value added activities of the different sectors of the economy. The former Bank of Botswana (BoB) official did not even say how much cash they have in their balance sheet, which will be released in the current financial year. While Motswagae did not reveal their previous clients, BG Business has been able to obtain documents which detail deals they have executed thus far. Some of the deals they have concluded include Choppies (P280 million) and Botswana Development Corporation (BDC) with P400 million.
Cash-strapped Botswana Meat Commission (BMC) has also received funding worth P125 million from the RMBB. The company was set up last November. Motswagae did not reveal how much they have contributed to FNBB‘s full year results for the year ended June 2014. FNBB is currently on a closed period and it will publish results sometimes in August. The investment unit of FNBB comes at a time when the local economy is not performing satisfactorily, which affects companies and lenders respectively. Commercial banks such as Standard Chartered Bank have also announced plans to aggressively market corporate lending. Motswagae is not concerned about competition. “I can’t talk about other banks. What I can say is that we have the right capacity and products as far as investment banking is concerned,” said Motswagae, a former treasurer at FNBB.