Tuesday, December 5, 2023

Banking legion says pretax profits in double digit

Barclays Bank of Botswana, the titan of the banking sector, proudly indicated that the household and corporate division got through the toughest period in its living memory since it opened shop in this country some 60 years ago.

In its full year report to December 31 2010, which covered the darkest global economic climate since the last Great War, it said profit before tax was 11 percent better to P 657 million compared to P 591 million in the previous period.

It thanked household sector that generated P 948.6 million and corporate that stood at P 64 million at a time when the sector was engaged in cautious lending state. The two segments were ahead of treasury and Barclaycard that performed poorly over the period.

The two segments were respectively shaved down to P 268 million from P 380 million and P 140 million from P 158 million from the year earlier.

Barclays controls nearly 60 percent of the commercial loan book in the country and has a myriad of branch network and Automated Teller Machines that beat that of Standard Chartered Bank of Botswana which started business in this country in 1897.

The robust performance shown by what could be termed the bell-weather of the banking industry in the country is in line the result paraded by some of its peers, notably, BancABC and First National bank of Botswana that did final and half year, respectively, earlier in the year.

Although the company seems to have been stingy in ditching out loans to the customers citing the prevailing economic conditions it is expected to brag about its improving customer service at the formal answer and question presentation of results tomorrow morning (Monday).

The move was partly helped by the snobbish mood of pricing customersÔÇöespecially those in the unsecured loans bracket and to some extend the controversial Bank of Botswana Certificate (Bobcs) that has led to price distortion in the market.

The unsecured loan market pays more, if not double, in terms of the interest rates compared to the rich and wealthy. The kind of interest rates they pay to the banks are only rivaled by the furniture shops and loan sharks.

The legion of the sector said its earnings per shareÔÇöthe most significant measure of any company — improved by 12 percent to 58.61 thebe against 52.48 thebe in the previous year. The bank further indicated that it is more in healthy shape and not wasteful as its cost income ratio stands 39 percent something that is any envy to its peers.

Net fee and commission also improved by 29 percent while impairments were reign in by 20 percent from P 204 million to P 162 million. Loans and advance were flat year-on-year as were deposits from customers.

However, the expectation is that Wilfred Mpai, its caretakers Chief Executive Officer since late last year will provide some insights tomorrow at his maiden briefing to both financial analysts and journalists on the outlook of the company.

It closed the week on Friday unchanged at 580 thebe.


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