Connect with us
Advertisement

Over a million people have access to banking services – Bank of Botswana??

Over 1.1 million people now have access to banking services in the country, translating to 70 percent of the adult population and an increase of 10.7 percent compared to 2017, the Bank of Botswana (BoB) announced in its Banking Supervision Annual Report for 2018.



In 2017, the bankable adult population stood at 64.4 percent translating to one million people then.

"Access to banking services, as measured by the ratio of number of depositors to adult population, improved from 64.4 percent in 2017 to 70 percent in 2018. The number of depositors grew by 10.7 percent from 1 million in 2017 to 1.1 million in 2018, while adult population increased by 2.1 percent from 1.56 million," the BoB said.



During the period under review, Botswana had 10 licensed commercial banks and three statutory banks.

"During 2018, five bureaux de change were licensed, while nine bureaux de change licences were revoked.  As a result, the number of licensed bureaux de change decreased from 61 in 2017 to 56 in 2018," BoB said in its review of the banking sector operations in 2018.

The ongoing restructuring operations by banks resulted in the opening of new branches and closure of some.  As a result, banking operations increased from 143 to 147 in 2018. 

The number of automated teller machines (ATMs) also increased from 473 to 523.

"Most of the new ATMs have more functions, including deposit taking capabilities, thus improving convenient access to transactional banking services.  With respect to geographical distribution of the branch network, the South East District, which includes the capital city, Gaborone, led the concentration of branches at 64, followed by the Central District at 33. 

Central District had an increase of one branch, while the branch network for the other districts was unchanged," BoB said.

Commercial banks maintained a dominant share of total industry asset , deposits, loans and advances compared to statutory banks.  On the other hand, the market shape of statutory banks fell slightly with respect to total assets, deposits, loans and advances, with 6.7 percent, 5.8 percent and 7.7 percent at the end of 2018, respectively, compared to 7.5 percent, 6 percent and 8.1 percent in 2017.



"Five banks continued to dominate the banking sector and accounted for 88.7 percent, 87.9 percent and 87.8 percent of total assets, total deposits, and total loans and advances, respectively, in 2018, although slightly lower than the respective proportions of 89.5 percent, 88.5 percent and 88.7 percent reported in 2017."

On pension fund assets, the ratio fell from 45.5 percent in 2017 to 41.6 percent in 2018, owing to a slight decrease of 3.7 percent in valuation of pension funds.

"
 

The aggregate household savings in the banking sector and pension funds was P92.8 billion compared to the household borrowing of P35.1 billion.  On this measure, the household sector was, therefore, a net saver in the economy," BoB said.

It added that total loans and advances were at P58.3 billion compared to P54.2 billion in 2017, while foreign currency dominated loans increased by 19.1 percent.
"As result, the ratio of foreign currency dominated loans to gross loans and advances increased to 7.8 percent in 2018, while it was 7.1 percent in 2018.

"All banks complied with the Foreign Currency Exposure Directive by maintaining foreign currency exposure to unimpaired capital ratios within the required 15 percent, five percent and 30 percent limits for major, minor and overall foreign currency exposures,
respectively."



Total credit to the household sector increased by 6.2 percent from P33.1 billion in 2017 to P35.1 billion.  The shape of mortgages, however, declined to 27 percent in 2018 compared to 28 percent in 2017, while the proportions for credit cards and motor vehicles were unchanged at three percent and five percent respectively.

The private sector maintained the highest share of deposits of 71 percent, while the share deposits for the public (Government and Parastatals) and household  sector remained at nine percent and 20 percent, respectively, in the same period.

On employment in the banking sector, BoB said the number of people directly employed increased from 5 176 in 2017 to 5 270, representing a 1.8 percent growth, albeit at a slower pace than the 2.4 percent in 2017.

"

While there was an increase in staff complement for some banks, there was a decrease with respect to seven banks.  The decline in employment at these banks was due to retrenchments, staff resignation and closure or merging of branches by some banks.

"The number of expatriates employed by the banking industry fell from 66 in 2017 to 60 in 2018.  Overall, the staff complement for small banks increased by 3.1 percent, from 485 in 2017 to 500 in 2018, for the large banks, the level of employment rose by 2.2 percent from 4 137 in 2017 to 4 226," the BoB announced.

Banks also continued to diversify, develop and improve their products and services to meet evolving customer needs and to accommodate and harness industry and market innovation in areas of potential business growth.

"

During 2018, banks introduced 14 new products and services covering a wide range of banking services, namely, transactional accounts and mobile-banking services were designed to foster growth of customer base and retention of existing ones (thus financial inclusion), hence mainly featured enhancements and lower service fees," it said.

The BoB also conducted on site examination of 10 bureaux de change to access their compliance with the Bank's regulations.

"The on-site examination indicated that one bureau de change complied with all the provisions of the regulations, while all others violated various aspects of the provisions of regulations.  Six bureaux de change were fined a total of P12 320 for violating regulations. 

Two bureaux de change were cautioned for non-compliance, while another had its licence suspended for three months.  The suspended bureau de change subsequently ceased operation and voluntarily surrendered its licence," the Bank said.

It noted that most of the recurring violations by bureaux de change related to failure to take reasonable measures to obtain information about the true identity of persons on whose behalf financial transactions were conducted and failure to continually train employees.

Continue Reading

Business

Jewellery manufacturing plant to create over 100 jobs

30th January 2023

The state of the art jewellery manufacturing plant that has been set up by international diamond and cutting company, KGK Diamonds Botswana will create over 100 jobs, of which 89 percent will be localized.

This content is locked

Login To Unlock The Content!

Continue Reading

Business

Investors inject capital into Tsodilo Resources Company

25th January 2023

Local diamond and metal exploration company Tsodilo Resources Limited has negotiated a non-brokered private placement of 2,200, 914 units of the company at a price per unit of 0.20 US Dollars, which will provide gross proceeds to the company in the amount of C$440, 188. 20.

According to a statement from the group, proceeds from the private placement will be used for the betterment of the Xaudum iron formation project in Botswana and general corporate purposes.

The statement says every unit of the company will consist of a common share in the capital of the company and one Common Share purchase warrant of the company.

Each warrant will enable a holder to make a single purchase for the period of 24 months at an amount of $0.20. As per regularity requirements, the group indicates that the common shares and warrants will be subject to a four month plus a day hold period from date of closure.

Tsodilo is exempt from the formal valuation and minority shareholder approval requirements. This is for the reason that the fair market value of the private placement, insofar as it involves the director, is not more than 25% of the company’s market capitalization.

Tsodilo Resources Limited is an international diamond and metals exploration company engaged in the search for economic diamond and metal deposits at its Bosoto Limited and Gcwihaba Resources projects in Botswana.  The company has a 100% stake in Bosoto which holds the BK16 kimberlite project in the Orapa Kimberlite Field (OKF) in Botswana.

Continue Reading

Business

Global CEOs Back Plan to Unlock $3.4 Trillion Potential of Africa Free Trade Area

23rd January 2023

African heads of state and global CEOs at the World Economic Forum Annual Meeting backed the launch of the first of its kind report on how public-private partnerships can support the implementation of the African Continental Free Trade Area (AfCFTA).

AfCFTA: A New Era for Global Business and Investment in Africa outlines high-potential sectors, initiatives to support business and investment, operational tools to facilitate the AfCFTA, and illustrative examples from successful businesses in Africa to guide businesses in entering and expanding in this area.

The report aims to provide a pathway for global businesses and investors to understand the biggest trends, opportunities and strategies to successfully invest and achieve high returns in Africa, developing local, sub-regional and continental value chains and accelerating industrialization, all of which go hand in hand with the success of the AfCFTA.

The AfCFTA is the largest free trade area in the world, by area and number of participating countries. Once fully implemented, it will be the fifth-largest economy in the world, with the potential to have a combined GDP of more than $3.4 trillion. Conceived in 2018, it now has 54 national economies in Africa, could attract billions in foreign investment, and boost overseas exports by a third, double intra-continental trade, raise incomes by 8% and lift 50 million people out of poverty.

To ease the pain of transition to its new single market, Africa has learned from trade liberalization in North America and Europe. “Our wide range of partners and experience can help anticipate and mitigate potential disruptions in business and production dynamics,” said Børge Brende, President, and World Economic Forum. “The Forum’s initiatives will help to ease physical, capital and digital flows in Africa through stakeholder collaboration, private-public collaboration and information-sharing.”

Given the continent’s historically low foreign direct investment relative to other regions, the report highlights the sense of excitement as the AfCFTA lowers or removes barriers to trade and competitiveness. “The promising gains from an integrated African market should be a signal to investors around the world that the continent is ripe for business creation, integration and expansion,” said Chido Munyati, Head of Regional Agenda, Africa, World Economic Forum.

The report focuses on four key sectors that have a combined worth of $130 billion and represent high-potential opportunities for companies looking to invest in Africa: automotive; agriculture and agroprocessing; pharmaceuticals; and transport and logistics.

“Macro trends in the four key sectors and across Africa’s growth potential reveal tremendous opportunities for business expansion as population, income and connectivity are on the rise,” said Wamkele Mene, Secretary-General, AfCFTA Secretariat.

“These projections reveal an unprecedented opportunity for local and global businesses to invest in African countries and play a vital role in the development of crucial local and regional value chains on the continent,” said Landry Signé, Executive Director and Professor, Thunderbird School of Global Management and Co-Chair, World Economic Forum Regional Action Group for Africa.

The Forum is actively working towards implementing trade and investment tools through initiatives, such as Friends of the Africa Continental Free Trade Area, to align with the negotiation process of the AfCFTA. It identifies areas where public-private collaboration can help reduce barriers and facilitate investment from international firms.

About the World Economic Forum Annual Meeting 2023

The World Economic Forum Annual Meeting 2023 convenes the world’s foremost leaders under the theme, Cooperation in a Fragmented World. It calls on world leaders to address immediate economic, energy and food crises while laying the groundwork for a more sustainable, resilient world. For further information,

Continue Reading