Stanbic profits plummet
Stanbic Bank Botswana’s profits before tax for last year plummeted by 33 percent, the bank’s latest financial results have revealed.
According to the bank’s financials for the year ended 31 December 2021, a profit after tax of P204 million was recorded compared to P302 million in 2020.
The bank has attributed the development to an operating landscape that posed a difficult environment for businesses, requiring the bank to adapt and respond with agility. “The bank upgraded and transformed its digital platforms to enable clients to continue operations even throughout the toughest restrictions,” said Stanbic Chief Executive Officer, Chose Modise, adding that the bank ensured clients and partners are supported to stay afloat throughout the year. “The bank quickly deepened its Love Your Customer ( LYC) principles in embodying an empathetic role, to motivate staff as well as to assist clients largely affected by the COVID- 19 pandemic. “The bank did this by extending interventions in the credit space that enabled businesses to focus on survival with appropriate moratoria on some credit covenants,” said Modise. He said the interventions saw the bank demonstrate growth on its balance sheet and remain profitable.
In addition, Modise highlighted that capital management remains a strong key measure as the bank invests in an efficient capital allocation and consumption strategy. “Amidst the liquidity challenges posed by the reduced levels of business activity over the past two years, the bank managed to close with a strong liquidity position well above the approved risk appetite and tolerance limits. “The prudential liquidity measure closed at 12.67 percent in 2021, exceeding the minimum regulatory requirements of 10.0 percent,” said Modise.
Meanwhile, Stanbic has pinned hope on the easing of COVID- 19 and improving vaccination rates that have made for easier global economic activity, as most borders opened across the world. “With the end of SOE locally, making for a revival of the economic landscape, most businesses are back to trading,” said Modise.
Even with the lifting of the SOE, Modise said the bank continues to support its clients by way of restructures and availing facilities to revive business activity, with measures in place to also protect the balance sheet. “The bank looks forward to more business opportunities on the back of the electronic platform developments that were birthed during COVID- 19 to improve the ease of doing business with our customers.”
However, the bank is closely monitoring and assessing the potential impact of the Russia- Ukraine conflict to proactively manage any imminent threats. “The length of the conflict and depth of the sanctions on major supplies by Russia could have an impact especially in the diamond and oil industries, food and fertiliser sectors and on major currencies,” said Modise.