Banks scrap around for deposits

SOURCE: BANK OF BOTSWANA
SOURCE: BANK OF BOTSWANA

There is an extensive hunt for deposits in the commercial banking industry as banks have run out of loanable funds due to a prolonged period of over-extended lending without a commensurate growth in deposits.

A snap survey of the banks’ deposits rates shows that the liquidity crunch has pushed up the cost of funds for the banks as deposits rates have risen, a development that will further squeeze profit margins in the prevailing low lending rates environment.

In the past six months, deposits rates for smaller depositors have slightly gone up from an average of about 3.75 percent to 4.10 percent for six months fixed deposits. For 12-months fixed deposits have gone up   from 4.15 percent to 4.75 while two-year deposits has gone up from 4,5 percent to five percent. 

Editor's Comment
The corrupt must be punished

The findings reveal a disturbing pattern of misconduct and lack of transparency that cannot be ignored.The Tribunal, led by Judge President Justice Kabelo Lebotse, has rightly condemned the Ministry for its eyebrow raising conduct in awarding a P1.8 billion water tender to China Civil Engineering Construction Corporation (Pty) Ltd and Zhong Gan Engineering & Construction Corporation (Pty) Ltd.The award was made despite alleged clear evidence that...

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