Connect with us

Stanbic Bank Committed to the Financial Wellbeing of Customers

Stanbic Bank Botswana encourages Batswana to practice good financial management habits in the New Year as part of a long-term objective of promoting greater financial wellness among Batswana. The Bank is committed to ensuring enhanced financial literacy and better financial health of all Batswana.

Commented Head of Marketing at Stanbic Bank Botswana, Ms. Stephanie Stoneham, “The beginning of the Year is a great time to review old financial practices and assess what worked and what did not. It is a perfect time to reassess one’s financial goals, and find new strategies for accomplishing them. At Stanbic Bank, we are dedicated to helping our customers improve their financial wellness and achieve their investment goals. After all, financial wellbeing is an integral part of overall wellbeing.”

Ms. Stoneham encouraged the public to practice the following strategies in the New Year as part of achieving sound financial health:

Create and maintain a budget.

A budget can help you determine which expenses to pay off first and which ones last. Start off with the big expenses: rent or mortgage, car loan, school fees, food and petrol. These expenses are the legs on which your life stands. They are the main source of stress in your life when you have limited or no financial resources. After taking care of the big expenses, save some of your money for a rainy day and emergency situations.  

Enroll in an automated savings plan.

Saving your money is the second most important thing to do after paying your expenses such as mortgage, rent and food.
Ensure that you choose a savings plan with the highest level of return. Additionally, make sure that you will not have easy access to your savings account to avoid depleting it on unnecessary things.

Save more than you are currently doing.

Most people underestimate how much they will need to live comfortably after retirement. It is difficult to anticipate inflation rates and health bills that may affect the amount of disposable income available for daily living, which is why it is important to increase your monthly savings value. Lifestyle creep, which is the tendency for expenses to increase as one’s income increases needs to be factored as well when you are planning your savings and retirement.

Read financial books.

Most of us overlook the benefits of reading financial management and investment books to learn the various strategies and tactics of investing successfully. There is a plethora of knowledge out there about best practices that could guide the beginning investor or bolster the returns of a seasoned one. Finance books could give you strategies on how to build your business, amplify your brand and find new business opportunities that you might have never thought of.

“Good financial management gives you peace of mind, and, most importantly, increases the likelihood that you will live comfortably in your later years. By developing good financial habits, you ensure that you and your loved ones will be taken care of when there is an emergency or are no longer able to actively provide for your family. It is a means towards planning for a better future, and this is something we are truly passionate about making a reality. Beginning the year on a good financial footing is a great way to start the process,” concluded Ms. Stoneham.

Continue Reading


Botswana on high red alert as AML joins Covid-19 to plague mankind

21st September 2020

This century is always looking at improving new super high speed technology to make life easier. On the other hand, beckoning as an emerging fierce reversal force to equally match or dominate this life enhancing super new tech, comes swift human adversaries which seem to have come to make living on earth even more difficult.

The recent discovery of a pandemic, Covid-19, which moves at a pace of unimaginable and unpredictable proportions; locking people inside homes and barring human interactions with its dreaded death threat, is currently being felt.

This content is locked

Login To Unlock The Content!

Continue Reading


Finance Committee cautions Gov’t against imprudent raising of debt levels

21st September 2020
Finance Committe Chairman: Thapelo Letsholo

Member of Parliament for Kanye North, Thapelo Letsholo has cautioned Government against excessive borrowing and poorly managed debt levels.

He was speaking in  Parliament on Tuesday delivering  Parliament’s Finance Committee report after assessing a  motion that sought to raise Government Bond program ceiling to P30 billion, a big jump from the initial P15 Billion.

This content is locked

Login To Unlock The Content!

Continue Reading


Gov’t Investment Account drying up fast!  

21st September 2020
Dr Matsheka

Government Investment Account (GIA) which forms part of the Pula fund has been significantly drawn down to finance Botswana’s budget deficits since 2008/09 Global financial crises.

The 2009 global economic recession triggered the collapse of financial markets in the United States, sending waves of shock across world economies, eroding business sentiment, and causing financiers of trade to excise heightened caution and hold onto their cash.

The ripple effects of this economic catastrophe were mostly felt by low to middle income resource based economies, amplifying their vulnerability to external shocks. The diamond industry which forms the gist of Botswana’s economic make up collapsed to zero trade levels across the entire value chain.

The Upstream, where Botswana gathers much of its diamond revenue was adversely impacted by muted demand in the Midstream. The situation was exacerbated by zero appetite of polished goods by jewelry manufacturers and retail outlets due to lowered tail end consumer demand.

This resulted in sharp decline of Government revenue, ballooned budget deficits and suspension of some developmental projects. To finance the deficit and some prioritized national development projects, government had to dip into cash balances, foreign reserves and borrow both externally and locally.

Much of drawing was from Government Investment Account as opposed to drawing from foreign reserve component of the Pula Fund; the latter was spared as a fiscal buffer for the worst rainy days.

Consequently this resulted in significant decline in funds held in the Government Investment Account (GIA). The account serves as Government’s main savings depository and fund for national policy objectives.

However as the world emerged from the 2009 recession government revenue graph picked up to pre recession levels before going down again around 2016/17 owing to challenges in the diamond industry.

Due to a number of budget surpluses from 2012/13 financial year the Government Investment Account started expanding back to P30 billion levels before a series of budget deficits in the National Development Plan 11 pushed it back to decline a decline wave.

When the National Development Plan 11 commenced three (3) financial years ago, government announced that the first half of the NDP would run at budget deficits.

This  as explained by Minister of Finance in 2017 would be occasioned by decline in diamond revenue mainly due to government forfeiting some of its dividend from Debswana to fund mine expansion projects.

Cumulatively since 2017/18 to 2019/20 financial year the budget deficit totaled to over P16 billion, of which was financed by both external and domestic borrowing and drawing down from government cash balances. Drawing down from government cash balances meant significant withdrawals from the Government Investment Account.

The Government Investment Account (GIA) was established in accordance with Section 35 of the Bank of Botswana Act Cap. 55:01. The Account represents Government’s share of the Botswana‘s foreign exchange reserves, its investment and management strategies are aligned to the Bank of Botswana’s foreign exchange reserves management and investment guidelines.

Government Investment Account, comprises of Pula denominated deposits at the Bank of Botswana and held in the Pula Fund, which is the long-term investment tranche of the foreign exchange reserves.

In June 2017 while answering a question from Bogolo Kenewendo, the then Minister of Finance & Economic Development Kenneth Mathambo told parliament that as of June 30, 2017, the total assets in the Pula Fund was P56.818 billion, of which the balance in the GIA was P30.832 billion.

Kenewendo was still a back bench specially elected Member of Parliament before ascending to cabinet post in 2018. Last week Minister of Finance & Economic Development, Dr Thapelo Matsheka, when presenting a motion to raise government local borrowing ceiling from P15 billion to P30 Billion told parliament that as of December 2019 Government Investment Account amounted to P18.3 billion.

Dr Matsheka further told parliament that prior to financial crisis of 2008/9 the account amounted to P30.5 billion (41 % of GDP) in December of 2008 while as at December 2019 it stood at P18.3 billion (only 9 % of GDP) mirroring a total decline by P11 billion in the entire 11 years.

Back in 2017 Parliament was also told that the Government Investment Account may be drawn-down or added to, in line with actuations in the Government’s expenditure and revenue outturns. “This is intended to provide the Government with appropriate funds to execute its functions and responsibilities effectively and efficiently” said Mathambo, then Minister of Finance.

Acknowledging the need to draw down from GIA no more, current Minister of Finance   Dr Matsheka said “It is under this background that it would be advisable to avoid excessive draw down from this account to preserve it as a financial buffer”

He further cautioned “The danger with substantially reduced financial buffers is that when an economic shock occurs or a disaster descends upon us and adversely affects our economy it becomes very difficult for the country to manage such a shock”

Continue Reading
Do NOT follow this link or you will be banned from the site!