BancABC focuses on revenue growth – MD

SHARE   |   Wednesday, 17 June 2020   |   By Bakang Tiro
BancABC Managing Director, Kgotso Bannalotlhe BancABC Managing Director, Kgotso Bannalotlhe

Amidst operating in a very tough and sluggish economic trajectory, the Botswana Stock Exchange-listed BancABC’s full year results showed a slight decline in profit after tax for the year ending December 31 2019 as compared to the previous period.

Profit after tax for 2019 stands at P122 million compared to P128 million in 2018. The bank recorded a non-interest income of P127 million; a 5% decline to prior year.  

With regards to total income, the net interest income closed the year at P142 million which was 1% shy of the prior year performance despite 11% increase in the loans and advances.

The decline in performance suffered in the year under review according to the bank could be attributed to a slow start in the first half due to low economic activity, among others.

The Managing Director Kgotso Bannalotlhe said the bank’s full year results show a rebound from the much slower performance to end the year with a Profit after Tax of P122 million. They had stronger growth in most income lines in second half of the year.

“The PAT is a modest 5% lower than in the previous financial year while non-interest income remained flat (1% movement in comparison to 2018) despite declining yields exacerbated by reduction in policy rates of 25 basis points in the second half of the year,” Bannalotlhe said.

He said the interest expense also remained flat although slightly elevated based on historic trends; saying significant growth was also achieved in customer deposits.

“This performance validates the bank’s success in navigating against t the challenging operating environment. We remained committed to building sustainable underlying revenue growth and operating income with the view of exploiting medium term value for our shareholders,” he said.

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To achieve this, Bannalotlhe said they have continued to invest in their transformation journey with changes only required to ensure they continue to deliver acceptable returns to shareholders.

Finance Director at BancABC, Ratang Icho-Molebatsi noted that Botswana showed a subdued economic growth in 2019 due to the decline of the local diamond sector.

A modest 4% year on year-on-year growth was achieved in the non-mining sector equated to 5.1% in prior year and observers forecast a decline due to COVID-19.

She said the regression in the growth of non-mining segment was as a result of slower expansion in the trade and hospitality sectors which were adversely affected by the decline of the diamond industry.


“Domestic credit growth remained strong driven by annual salary increments, ranging between 6%-10% by Government of Botswana which is the highest employment contributor in the country. Nevertheless, household credit, which has held a 60%-65% share in overall credit since 2017 continued to be largely driven by personal unsecured lending,” Molebatsi buttressed.


The fast rising bank said its capital position remained very strong with adequacy ratio of 18.6%. At the half-year reporting on 25 September 2019, BancABC announced a dividend of 2.8 Thebe per share for the period ended June 2019. It was declared and paid on November 22, 2019 to shareholders.