Stanbic Bank Botswana recorded a strong P195 million profit after tax for the year ended 31 December 2016, despite challenges in the economy characterised by a muted economic growth and challenges in the mining and agriculture sector. According to the financial results for the year ended 31 December 2016, signed by Chief Executive Leina Gabaraane and Chairman Craig Graville, the unlisted bank made P195 million as profit representing an annual growth of 48 percent.
This puts the bank, which is a subsidiary of Standard Bank, well within the top four banks in terms of profitability in Botswana. The 25 year old bank says loan book growth remained muted for most of the year until the last quarter mainly due to the low credit appetite from clients.During the period under review, the bank made appropriate investments to secure the long-term sustainability of the bank.
“A number of these investments were made to embed the employee value proposition. The most important form of the investments was directed at building personal effectiveness and leadership of all supervisors and managers across the Bank,” read part of the statement.
During the year, the bank remained strongly committed to funding and supporting commercial business opportunities as well as personal wealth creation.The bank says the 11 percent growth in the loan book reflects the success of this drive, albeit within a very challenging macro-economic environment.
The economic realities also required some measure of counter-balance with the need to keep credit risk pressure at acceptable levels. “The three percent decline in customer deposits was a deliberate cash flow management outcome to optimise the balance sheet and also control costs of funds. It was also the outcome of re-balancing the concentration on institutional funding with retail deposits,” said the bank in a statement. This resulted in retail deposits growing by six percent to fund the percentage decline in Corporate and Investment Banking (CIB) deposits.For the first time in three years, dividends of P150 million were declared and paid in June.
Notwithstanding the current market challenges, Stanbic Bank says there is growing confidence across the Bank in its ability to deliver strong results against expected macroeconomic challenges.It says the confidence levels stem from investment in staff, technology and improved processes to deliver superior client experience.