Banners
Banners

Latest News

The Ministry of Local Government and Rural Development has appointed B...
Local female rapper Sasa Klaas (Sarona Motlhagodi) of Mmamongwato fame...
A three-men Court of Appeal (CoA) panel comprising Judge President Ian...
Botswana Public Officers Pension Fund (BPOPF) supports in full efforts...
Banners
Banners

FNBB raises red flags on credit

PAULINE DIKUELO
Wary: Bogatsu is keeping an eye on the numbers PIC: PHATSIMO KAPENG
The country’s largest lender, First National Bank Botswana (FNBB), is sounding the alarm on growing over-indebtedness and arrears amongst individuals in the country.

As at December 31, 2019, individual customers owed FNBB P9.4 billion or about 60% of the bank’s total loan book.

For the six months ended December 31, 2019, total loans advanced by FNBB to its individual customers rose 9.6 percent, while impairments amongst individual customers rose 43% to P121.3 million.

Impairment is an accounting term used when it is likely that not all of the principal and interest of a loan will be collected.

Non-performing loans, or those where payments have been skipped, were pegged at P1.17 billion by December 2019, compared to P1.14 billion in June 2019.

FNBB CEO, Steven Bogatsu said the trend was worrying and showed that consumers are under pressure, augmenting their income based on credit.

“We have people close to retirement still borrowing mostly to take care of their families which could be leading to impairments. This is a risky space that requires a lot of caution,” he said, presenting the bank’s recent financials.

 “We have a serious problem of non-performing loans and currently have about 400 houses under repossession.

“We have put in place a collection team that will also focus on rehabilitating customers.”

Bogatsu said the

Banners
increase in the impairment provision was expected under the retail banking sector, which comprises individual customers, as opposed to organisations and corporates.

“The impairment charge was further increased by the rise in retail personal loans which in turn carry higher expected credit loss provisions at initial origination,” he said.

Bogatsu said arrears on loans in the broader banking sector continue to be concentrated amongst households and businesses and were expected to mildly increase in the short term.

According to notes accompanying FNBB’s results for the six months ended December 2019, the bank intentionally cut back lending on ‘high risk accounts’ in its business portfolio.

Loans to the business sector retreated to P2.6 billion by December 2019, from P2.9 billion as at December 2018. Impairments of loans under FNBB’s business sector amounted to P42.6 million from P48.5 million in the previous corresponding period.

While executives expressed concern, FNBB will take comfort from ratios showing that gross advances of loans to gross impairments of advances are down, as are gross advances to Non-Performing Loans. 

Over the reporting period, the bank recorded a 13% increase in pretax profit at P554.6 million.



Business

Banners
Banners ?>

Selefu

This calls for a serious security risk investigation

Latest Frontpages

Todays Paper Todays Paper Todays Paper Todays Paper Todays Paper Todays Paper
Banners
Adana Escort
Adıyaman Escort
Afyon Escort
Ağrı Escort
Aksaray Escort
Amasya Escort
Ankara Escort
Antalya Escort
Antep Escort
Ardahan Escort
Artvin Escort
Aydın Escort
Balıkesir Escort
Bartın Escort
Batman Escort
Bayburt Escort
Bilecik Escort
Bingöl Escort
Bitlis Escort
Bolu Escort
Burdur Escort
Bursa Escort
Çanakkale Escort
Çankırı Escort
Çorum Escort
Denizli Escort
Diyarbakır Escort
Düzce Escort
Edirne Escort
Erzincan Escort
Elazığ Escort
Erzurum Escort
Eskişehir Escort
Giresun Escort
Gümüşhane Escort
Hakkari Escort
Hatay Escort
Iğdır Escort
Isparta Escort
İskenderun Escort
İstanbul Escort
İzmir Escort
İzmit Escort
Karabük Escort
Karaman Escort
Kars Escort
Kastamonu Escort
Kayseri Escort
Kıbrıs Escort
Kırıkkale Escort
Kırklareli Escort
Kırşehir Escort
Kilis Escort
Kocaeli Escort
Konya Escort
Kütahya Escort
Malatya Escort
Manisa Escort
Maraş Escort
Mardin Escort
Mersin Escort
Muğla Escort
Muş Escort
Nevşehir Escort
Niğde Escort
Ordu Escort
Osmaniye Escort
Rize Escort
Sakarya Escort
Samsun Escort
Siirt Escort
Sinop Escort
Sivas Escort
Şırnak Escort
Tekirdağ Escort
Tokat Escort
Trabzon Escort
Tunceli Escort
Urfa Escort
Uşak Escort
Van Escort
Yalova Escort
Yozgat Escort
Zonguldak Escort
Alaçatı Escort
Aliağa Escort
Alsancak Escort
Bornova Escort
Buca Escort
Çeşme Escort
Çiğli Escort
Gaziemir Escort
Karşıyaka Escort
fethiye escort
iskenderun escort
iskenderun escort
iskenderun escort
iskenderun escort
iskenderun escort karataş escort ceyhan escort ankara escort etimesgut escort çankaya escort altındağ escort mamak escort keçiören escort