Monday, June 24, 2024

BIHL seeks to diversify offerings in the financial services sector

Botswana Insurance Holdings limited (BIHL) remains steadfast in its mission to become a significant broad based financial services provider in Botswana and Southern Africa. BIHL said it long came to terms with the fact that realising this goal will require that the financial services giant evolves in two particular respects, how and where they do business, which are at the core of guaranteeing their continued sustainability.

“In order to achieve this goal, we need to continue to diversify while at the same time finding innovative ways to further differentiate our brands and their offering in this intensely competitive market,” said BIHL Group CEO, Gaffar Hassam.

He revealed that going forward, the group will continue on its strategic path to seek opportunities for diversifying its offerings in the financial services sector while protecting and enhancing its existing businesses. Hassam said BIHL remains committed to its strategic aspiration to become a broad based financial services group, participating in various areas of the financial services sector.

“The results of the strategic focus by management in 2013 are visible in the impressive financial performance of the business. Besides the financial growth achieved, BIHL successfully launched several programs and initiatives that will go a long way in attaining future growth,” said Hassam.

A few notable developments in the past year include introduction of the Unit Trust business, which is a relatively new operation that is already showing signs of positive growth with the support of Bifm, the asset management business, and the rest of the BIHL Group. He also revealed that BIHL’s investment in Letshego several years ago continues to show dividends as profits from the business contributed positively to the BIHL Group during the year.

“Shareholding in FSG, a critical partner to the group, was increased to 34percent, positively impacting our profitability. By carefully managing costs across the group, the business has been able to manage profitability,” said Hassam.

Information contained in BIHL’s latest annual report indicates that the group’s strategy was successful year ending 31 December 2013. The group focused on using its collective strength as Botswana’s leading multi-line insurance provider to defend and grow market share, while exploring new income streams. While the BIHL continued to operate under challenging economic conditions, it performed exceptionally well during the period under review. Profit After Tax (PAT) increased by 25 percent to P495 million and Embedded Value, which is the estimated total value of the group, increased by 21 percent to P3.3 billion. The latter was positively influenced by operating returns, especially in the life business, as well as good investment returns in line with global market performance. In a similar vein, assets under management increased by 25 percent to P27.1 billion, and total revenue showed a robust increase of 58 percent to P4.9 billion. Further, basic earnings per share for ordinary shareholders increased by 25 percent from 146 thebe in 2012 to 183 thebe in 2013. Diluted earnings per share likewise increased by 25 percent from 145 thebe in the previous year to 181 thebe in 2013, and normal dividends gross of tax were awarded at 50 thebe per share.

Hassam is of the view that the strong performance comes on the back of strong assets under management, a position strengthened by new mandates received in the latter half of 2013.

“This demonstrates that, after 38 years of operating in Botswana, BIHL is well established, financially stable and consistently fulfilling its mandate to all its stakeholders, especially shareholders and customers,” he said.


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