BDC’s P615m investment shortfall
Lewanika Timothy | Monday May 26, 2025 13:00
Despite the chunky deficit the entity maintained optimism in its investment pipeline with two transactions valued over P300 million supposedly at legal close stage.
A recently published annual report of BDC showed major gaps in meeting its investment targets for the full year 2024 in what the company blamed on due diligence bottlenecks. The shortfall percentage was pegged at 71% a major shortfall that investment analysts at the firm were optimistic could be slashed through closing two major deals which were valued at P300 million.
“For the year ended June 30, 2024, the corporation had disbursements amount to P254 million, primarily directed toward a significant retail development in the northern part of the country where BDC does not have any representation,” the companies executives revealed in the report. “This significantly trailing the budgeted amount of P869 million by 71%, largely due to delays in due diligence processes for key transactions.”
On a year on year trend analysis, disbursements seemed to be on a free fall with the half years investment figure of P254 million being 16% down compared to investment amount in 2023.
“The disbursements for the full year were 16% below the prior years’. Despite the shortfall, the corporation remains optimistic about an improved disbursement trajectory in FY25 (financial year 2025), with several major transactions expected to be finalised in FY25,” the executives stated.
“The corporation closed the year with a hot and active deal pipeline valued at P2.47 billion with two transactions amounting P300 million at legal close, six transactions amounting to P873 million were at due diligence stage whilst the balance of the deals were at various initial approval stages,” the executives revealed.
Previously, the investment agency had shared its audacious P2.5 billion investment plan mostly targeting the financial services sector, which was earmarked to get 55% of targeted funding.
Beyond the financial services, BDC’s investment pipeline includes significant allocations to other sectors crucial to Botswana’s development such as the manufacturing sector which is due to receive 18% of the funds, whilst agro-processing is set to benefit 17% of the pipeline.
The gross portfolio value rose to P5.1 billion in June 2024, marking a four percent increase from P4.95 billion in June 2023. This growth was primarily driven by disbursements for the retail development. Meanwhile, the firms quality of loan assets improved, with non-performing loans experiencing a decline 13.1% in FY23 to 11.90% in FY24 remaining within the policy provisions of the corporation.