Umbrella for Democratic Change (UDC) Chairman Motlatsi Molapisi has risen from the political grave.
The chairman is now calling the shots.
Molapisi, who is also President of Botswana People’s Party (BPP), has decided that now is the time for him as chairman to take the lead. He has sanctioned a UDC National Executive Committee (NEC) meeting for next week Tuesday. This is despite the fact that he does not have powers to sanction such a high-level meeting.
The meeting has been scheduled for morning at the UDC office. Information gathered by Botswana Guardian is that the meeting, which Molapisi directed the UDC Secretariat to issue notice of, was not communicated to the UDC National Office Bearers as the Constitution demands.
The meeting will come a day after the one in which a faction of Botswana Movement for Democracy (BMD) is expected to appear before the UDC jurisdiction in the evening. UDC has summoned the two BMD factions to appear tion in asset quality experienced by the banking sector is attributed to, in the main, challenges for some diamond cutting and polishing businesses, job losses resulting from the closure of BCL group of companies and the ongoing retrenchments by some major employers, as well as weaker market for high-value residential properties,” said the central bank Monetary Policy Statement (MPS) review statement.
BCL group, which is wholly government owned, has been closed leaving thousands of employees in the lurch. These are some of the employees who are struggling to pay back commercial banks, in the process increasing the rate on NPLs. Some private companies and parastatals are restructuring, with the resultant outcome in most cases leaving some employees without jobs, despite the fact that, Statistics Botswana has reported that unemployment levels have dropped.
According to Investopedia, a non-performing loan is the sum of borrowed money upon which the debtor has not made his scheduled payments for at least 90 days. According to BoB, which is also the economic advisor to government, the NPL to total loans ratio for individual banks ranged from 0.2 percent to 10.8 percent in June 2017.
A much clearer picture of the health of the banking sector was expected in the banking supervision report which was due to be made public yesterday (Thursday). Some of the banks are expected to publish their interim and financial year results in the coming weeks, which will be an opportunity for them to break down the rate in which some of their customers have skipped payment.
In the report, the central bank has stated that, households account for a larger share of total lending by commercial banks, which stood at 59.6 percent in June 2017. Annual growth in mortgages moderated to 4.4 percent in June 2017 from 7.3 percent in June 2016, which mainly reflects a weak housing market, especially at the upper-end, and tighter lending criteria by some banks.
“Nevertheless, unsecured household lending, which constitutes a large proportion of commercial bank credit, represents relatively small amounts spread across many borrowers of differing credit profiles, which mitigates associated financial stability risks,” said the report.
Overall, current levels of credit growth continue to be supportive of economic activity and augur well for durable stability of the financial system, stressed the bank.
Recently, a report by Econsult also noted that, there has been no growth in the deposit base of banks for at least two years. “With little surplus liquidity, it is not surprising that bank lending has slowed – the banks (or some of them at least) are simply running out of loanable funds,” said the report compiled by Dr Keith Jefferies and Sethunya Sejoe.