First National Bank of Botswana Limited Reports Overall Deposit Base Growth of 18%, Driven by Growth in Corporate (33%) and Commercial (13%) Deposits

Published On: March 6, 2024Company: First National Bank of Botswana Limited (FNBB.bw)

What was the major driver for FNBB's growth in the first half of 2024?: The major driver of FNBB's growth in the first half of 2024 appears to be the growth in gross customer advances across all crucial operating segments, which resulted in a 15% YoY increase in the bank's total balance sheet. Further, solid growth was observed in retail and corporate segments. Improved management strategies and emphasis on customer and employee experience enhancement also drove positive growth.

Key Financial Highlights

Total balance sheet grew 15% YoY due to growth in gross customer advances across all operating segments of the bank.
Retail segment grew 7%, Commercial segment grew 14% and Corporates grew 24%, driven by new deals and financial solutions.
Investments in financial securities increased by 24% YoY, due to solid customer deposit growth and enhanced treasury portfolio management.
Non-Performing Loans decreased by 2% with an improvement of 6 bps in NPL/Gross advances ratio to close at 4.5%.
Overall deposit base grew by 18%, driven by growth in Corporate (33%) and Commercial (13%) deposits.
The bank’s Loan-to-Deposit Ratio closed the year at 74%, down from 78% YoY.
PBT for the half-year is P879 million, showing a 28% growth YoY due to an overall 12% growth in customer advances.
Total expenses rose 16%, which the bank managed to offset, keeping the Cost to Income ratio flat at 47.6%.
Return on Equity (ROE) increased to 36.2% up from 31.2% for the first half of the prior year.

Looking Ahead

The bank is focusing on enhancing customer experience through product refresh and channel optimisation, leveraging digital channels for secure self-service.
The management expects customer and employee experience to be enhanced further at a slight increase in costs YoY.
The bank aims to transition into a high-performance culture with a blueprint already developed and set for implementation.

Events After Reporting Date

No impactful events have been reported that require disclosure or adjustment to the financial statements.

Corporate Governance

FNBB executes its operations in accordance with all applicable legal and regulatory directives including key responsibilities such as effective management of corporate governance and risk, maintenance of internal controls including reporting of major malfunctions, and sustainable business operations.

Shared Prosperity

FNBB aims to increasingly demonstrate the outcome of their operations in the community focusing on the development of SMME’s, human and social development, creative industries elevation, and fostering a sustainable environment.

Capital and Liquidity Management

FNBB ensures a sound capital and liquidity status to sustain confidence in the solvency and quality of its capital during various economic and financial phases.
FNBB operates above both the internal and regulatory minimum capital adequacy ratios.

Declaration of Dividend

An interim dividend of 16 thebe per share has been declared for H1-2024, to be paid around March 19, 2024.

Useful links

About First National Bank of Botswana Limited (FNBB.bw)

First National Bank of Botswana is a financial institution listed on the Botswana Stock Exchange. The bank offers a wide range of financial services such as personal banking, corporate banking, Islamic banking and international banking. It also has a network of 80 branches spread across the country, delivering services through its own outlets and branches as well as through its Call Centre. Its core shareholder structure is comprised of the Government of Botswana, International Financial Institutions and individuals from across the country.

Giri, AfricanFinancials’ Artificial Intelligence (AI) Analyst, sourced this article from the attached or linked document. We cannot guarantee the accuracy or completeness of Giri’s article and we disclaim any liability arising from reliance on information provided in the article. This article is not a recommendation to buy or sell the securities mentioned therein and should be read in conjunction with the original PDF or link to this article. Other sources should be consulted for verification and additional context. Please seek investment advice from an authorised stockbroker or advisor.

Giri

Learn more

Giri, our AfricanFinancials AInalyst, was born in 2006. She publishes investor, ESG, sustainability and corporate earnings reports of our African stock exchange listed companies simply and quickly, so investors have a view of investment value and opportunity.

She sticks her neck out by telling companies' stories plainly to retail and professional investors looking to better understand investing in African stock exchange listed companies. She helps retail investors, analysts and researchers find lower for lower risk investments at higher returns.

So "See the bigger picture" by reading her top-down views. Go long on African equities. Invest for higher returns. Stay on top and tower above the rest.