The profits were more than 1,700% above the P3.7 million recorded by BSB in the half year ended September 2023.
In a commentary accompanying results which were posted to the Botswana Stock Exchange (BSE) this week, directors attributed the profit spike to a revised sales strategy coupled with a revision of its loan book.
“(After-tax) profit increased by an impressive 1,520%, reaching P52.8 million. This remarkable growth was primarily driven by growth in assets as well as the BSB Insurance Services which contributed P24.2 million to the group performance,” directors said.
According to the results, BSB’s loan book rose by 93% in the half year to P4.3 billion, when compared to the previous corresponding period. Despite the sharp increase in lending, the statutory bank was able to restrain its bad debts, with the net impairments rising to P5.8 million in September 2024, compared to P4 million in the previous half year.
Net interest income grew by 91% to P126 million reflecting the stronger lending and quality of the loan book.
“This increase was attributable to the bank’s revised sales strategy, which included expanding the bank's direct sales agency network and revising the maximum loan amount as well as extending loan tenure,” directors noted.
Earlier this year, BSB raised P192 million through a private placement of four bonds, with the funds earmarked to help its growth and target of boosting its loan book by 30%.
The bonds, which were privately placed with investors, are part of the BSB’s P1 billion note issuance programme announced last March.
According to a series of announcements made on the bourse, the BSB raised P82 million, P60 million, P30 million and P20.5 million in different maturing bonds carrying both fixed and floating rates.
The bonds’ maturities range between December 2023 and January 2028.
In a previous announcement, the BSB said the fundraising was part of the implementation of the business strategy, and played a critical role in achieving the ambitious goal of growing its loan book by close to 30%. “The group's net advances grew by 93% compared to the previous period, reaching P4.3 billion, demonstrating the bank’s ability to grow customer as well as asset base,” directors said.
Besides the fundraising, BSB was able to fund its loan book growth by attracting more deposits during the half year. Deposits increased to about P4.4 billion, compared to about P2.7 billion in the half year to September 2024.
Directors said the higher level of deposits reflects “continued customer trust and confidence in the bank”. BSB’s Capital Adequacy Ratio for the half year stood at 13%, “comfortably above the regulatory requirement of 12.5%,” directors noted.
Overall business growth was also credited to the optimal performance of the credit life portfolio through the BSB Insurance Services.
