Standard Chartered Bank Botswana’s (SCBB) profits after-tax grew by 21% to P60 million in the year to December 2021, from P49 million recorded in the previous corresponding period.
Unveiling the bank’s performance this week, officials said the growth was broad-based, delivered through diversified products from segments such as consumer, private and business banking as well as Corporate, Commercial and Institutional Banking (CCIB).
Commenting on the results, chief executive officer, Mpho Masupe said the CCIB segment recorded profits for the second year following a period of transformation, which he said demonstrated that SCBB’s foundations are solid and the strategy has been able to withstand a very challenging year.
“Our long-term strategy of streamlining our focus on key market segments is yielding positive results in terms of quality of the balance sheet and income mix,” he said.
In previous years, SCBB suffered impairments due to over-exposure in sectors such as diamonds and base metals mining.
Masupe further said the bank’s results reflect a slight improvement in business momentum responding positively to the gradual economic recovery following the peak of the COVID-19 pandemic in 2020 and early 2021.
According to the CEO, the ongoing pandemic remains a significant threat with a direct impact on productivity and business momentum. He said business strategies to grow sustainable non-funded income are beginning to show results with net fees and commissions registering a two percent growth surpassing pre-pandemic performance.
“Deposits from clients have shown resilience amid the re-alignment strategy and posted nine percent growth.
“This indicates that the fundamental base of the segments and strategy is strong,” he said.
The bank’s investments in digital platforms to deliver its digital strategy have started to yield results with costs dropping four percent to P188 million. Masupe said the digital strategy aims to avail a fully end-to-end digital experience for clients.
“Credit impairments remain well-controlled with a release of P28 million from a loss of P19 million in the prior year as the segment continues in its quest of delivering sustainable bottom-line profitability,” he said.
The low-interest-rate environment coupled with market liquidity constraints contributed significantly to low margins with a resultant four percent drop in interest income. However, Masupe said the bank returned to top-line growth in the second half of the year. The balance sheet drop in advances to clients is a function of the segment’s balance sheet composition, which is predominantly short-term and transactional hence achieving efficiency in capital allocation, he said.
