Wednesday, October 28, 2020

Barclays records huge jump in pre-tax profits

Barclays Bank of Botswana delivered a strong performance in the first half of the year in the midst of various external challenges by achieveing 144 percent growth in profit before tax in comparison to the half-year ended 30 June 30, 2015, growing from P111 million to P270 million. 

The bank’s results for the half-year ended June 30, 2016 continued to make progress in growing the key business segments in the various sectors of the economy. Net trading income increased by 163 percent year-on-year driven by increased customer transaction volumes in the business segments. The bank’s operating costs have remained well contained with a cost to income ratio of 51 percent for the six months ended June 30, 2016 compared to 61 percent in the comparative half year.  

Impairment loss rate reduced year-on-year to 1.8 percent from 2.5 percent and the bank said this decrease in was mainly driven by improved collections and continued focus on monitoring and control activities relating to debt collection from clients who may be experiencing financial stress.

Barclays Bank Managing Director Reinette van der Merwe said the bank’s numbers showed that they were on a transformation journey adding that they had made significant progress in delivering on their strategy. 

“We believe that as we commemorate our country’s Golden Jubilee our customers feel the difference in the way they interact with our banking channels and our commitment to uplift the lives of communities in which we operate,” she stated.

Barclays Bank Finance Director Mumba Kalifungwa is of the view that the strong performance was mainly driven by sustained revenue increase in the Retail and Banking Business (RBB), and significant growth in excess of 50 percent, by Corporate and Investment Banking (CIB). He stated that net interest income increased by 18 percent year-on-year; mainly driven by increased transactional volumes, balance sheet growth and optimal utilisation of funding sources. Kalifungwa added that net fee and commission income increased by 20 percent year-on-year in line with the increase in net interest income.

Kalifungwa stated that business continued to register strong growth in its financial position resulting in an overall year-on-year balance sheet growth of 12 percent. 

He said the bank’s loans and advances to customers increased by P1.5 billion representing an 18 percent year-on-year growth. 

“Deposits due to customers increased by 10 percent as a result of positive flows from various institutional depositors as the liquidity squeeze eased up in the second half of 2015. This was achieved across all business segments and further demonstrates the progress we are making towards the achievement of our strategy,” said Kalifungwa.

Barclays Bank declared an interim dividend of 14.669 Thebe per share subject to regulatory approval for the half-year ended June 30, 2016, against a backdrop of strong capital levels and internal capital generation capacity.

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