Botswana Life CEO quits
Brian Benza | Wednesday September 20, 2017 18:00
Botswana Life recently released lukewarm results for the half-year ended June 2017, which were characterised by reduced premium income and declining values of new business.
In a statement released yesterday, parent company, BIHL announced that Moorad would be leaving the group to pursue other interests.
Moorad’s departure comes at a time when BIHL’s asset management subsidiary Bifm, recently lost three key investment team members who are reported to be starting up a new venture on their own.
While BIHL says Moorad is leaving to pursue other interests, company insiders says she was frustrated into throwing in the towel due to differences on how Botswana Life can ride over the current period of slow growth which is “largely induced by sector wide economic factors”.
“She was very frustrated as her plans on how to grow the business were often not accepted. The corporate head office, which has people that have run the insurance business for a long time, always had a different strategy to hers and she often felt sidelined. But the business environment has changed a lot in recent years and I believe Moorad was not given enough time as the low annuities and premiums are a result of exogenous factors such as the closure of BCL and other large companies. For an economy that is struggling, I don’t think the Botswana Life numbers are that bad,” said an insider who declined to be named as they were not authorised to speak to the media.
In the statement, BIHL said the process of identifying a replacement for Moorad had begun and BIHL Group CEO Catherine Lesetedi will in the meantime hold fort to ‘ensure a smooth transition with little to no disruption felt by the clientele’.
However, the group said they would take their time in identifying a new CEO at the subsidiary.
“It is key to remember that this is not something we will rush into, as steering the ship that is Botswana Life Insurance Limited, Botswana’s oldest and leading life insurance provider, is a responsibility we take with the utmost seriousness, as we strive to ensure the best interests of our staff, our business, our clients and our shareholders,” read the statement.
Announcing their results recently, BIHL said they would be embarking on a streamlining exercise at Botswana Life given the challenges on the profitability of the business.
In the half year to June 2017, BIHL’s operating profit for the life business was 26% lower than the same period in 2016 due to the subdued operational earnings from most key business lines, especially the annuity business.
Net premium income decreased by four percent year-on-year to P1.1 billion compared to P1.145 billion achieved in the prior year due to suppressed annuity business income.
“The value of new business written decreased by 22% from prior year owing to low new business volumes and reduced margins. Operating profit decreased from P192 million in June 2016 to P147 million in June 2017. The major explanation for the decrease was the low volumes for single premium business, which was acquired at lower margins,” the company stated.