Standard Chartered Bank Botswana has reported strong earnings recovery with a return on average equity at 11.2 percent for the half year results compared to 4 percent for the full year ended 31 December 2015. The Bank’s Chief Executive Moatlhodi Lekaukau said the business has performed well, given the challenging external environment and has delivered solid returns. Stan Chart, which is one the three commercial banks quoted on the Botswana Stock Exchange (BSE), announced its results on Friday with the balance sheet having strengthened by 12 percent in the six months from 31 December 2015. At a 19 percent capital adequacy ratio, the group says it remains well capitalised and has a highly liquid balance sheet with asset to deposit ratio of 66 percent. During the period under review, deposits from customers rose by one (1) percent to P11.7 billion and the bank reduced its loans to customers by two (2) percent due to challenging market conditions.
Operating income remained flat year-on-year while operating expenses were reduced by one (1) percent to P335 million which reflects cost efficiencies. The group says it has further strengthened its capital position, tightened risk tolerance and established more robust controls as it continues to focus on driving initiatives to realise long term sustainable gains. “Key among these is implementation of the refreshed strategy, which is beginning to bear fruit in Retail Banking. The segment delivered 6% total income year-on- year growth and focused on further developing specific value propositions to meet the unique requirements of its customer base,” said the statement accompanying the financial statement. The Group’s Corporate and Institutional Banking segment is reported to have been impacted by subdued growth in Transaction Banking and Financial Markets, which have been most affected by the trading environment, particularly in the mining sector.
It is, however, stated that the segment has successfully supported key client transactions in the market, contributing to overall progress and development in the economy as the bank assisted clients across the entire value chain. Stan Chart’s new Commercial Banking business is said to have performed well in 2016 and continues to show good potential. The segment registered a 16% increase in total income. With the rest of the year expected to continue to be challenging for commercial banks, Stan Chart believes the strategic measures undertaken in 2015 have positioned it well for growth.