Bank profits near historic high
Mbongeni Mguni | Wednesday December 6, 2023 17:08
Prior to the record profits seen last year, the previous peak in banks’ after-tax profits was P2.02 billion in 2018. Bank of Botswana (BoB) figures released recently indicate that commercial banks are powering towards a fresh high this year, helped to a large extent by healthy interest margins.
The banks’ net interest income in the first nine months of the year reached P4.5 billion, compared to P3.6 billion over the same period last year, reflecting the warming credit appetite amongst consumers and higher interest rates.
Net non-interest income this year was approximately -P1.3 billion compared to negative one billion in the corresponding period last year. Provisions for bad and doubtful debts were higher this year at P184.1 million in the first nine months, compared to P77 million over the same period last year.
Listed commercial banks reported bumper profits in the second earnings season of the year recently, with some showing profitability up by triple digits. Analysts said the high-interest rate environment from last year, as well as improved credit growth were driving factors.