NDB Takes Drastic Steps To Avert Closure

No Image

National Development Bank (NDB) has retrenched 50 of its staff as part of a turnaround strategy that was adopted by the board late last year.

The rationalisation and optimisation exercise which took six months came in the wake of a radical strategic plan that was meant to drive the bank towards profitability and sustainability.

Last December, the bank parted ways with their staff after failing to sail through the tighter liquidity , low interest rate margins that affected the banking sector. 

According to sources within NDB, the bank’s loan book shrank forcing the board to come up with strategies that will align the resources with the loan book.

NDB’s head of Branding, Marketing and Communications, Harry Marks said they put in place several measures meant to cut costs, amongst them freezing of recruitment and staff loans, which did not bear fruit..

“It then became clear that we had to adopt radical measures, hence the staff rationalisation and performance optimisation exercise. Over the years, NDB has been saddled with a high cost to income ratio, non-performing loans and liquidity challenges,” explained Marks.

The bank’s turnaround strategy was adopted by the board late last year, paving the way for the rationalisation and optimisation exercise. The strategy addressed key issues like profitability, sustainability and operational efficiency.

However, Marks said the bank is now a lean effective and efficient financial institution noting that they are optimistic that it would return to profitability in the next few years.

Figures released by the Bank of Botswana (BoB) late last year  indicated that the good times have returned to the local commercial banking sector following several lean years owing to a fee moratorium and tight spreads.

The six-month profits for banks are nearly 64% higher than the corresponding period last year and hold the promise of a record performance by the sector by the end of the year.

The only times half-year profits for banks were higher than this year was in 2013 (P941.4 million) and 2012 (P864.9 million).

The BoB data shows that the banks powered into 2018 with after-tax profits of P143 million in January, rising to P190.4 million in May.

Editor's Comment
What about employees in private sector?

How can this be achieved when there already is little care about the working conditions of those within the private sector employ?For a long time, private sector employees have been neglected by their employers, not because they cannot do better to care for them, but because they take advantage of government's laxity when it comes to protecting and advocating for public sector employees, giving the cue to employers within the private sector...

Have a Story? Send Us a tip
arrow up