Africa-Press – Botswana. Indigenous Banker, BBS Limited has posted a P30 million loss for the interim period ended 30 June 2023, compared to a loss of P20 million in the same period in the previous year, the group’s financial statements published this week show.
The BBS board says factors that contributed to a poor run during the interim period include amongst other things transformational costs, subdued uptake of mortgage loans and taxation.
After obtaining the banking license in October 2022, BBS limited says there were necessary one-time transformational costs incurred.
“These costs included separation packages which amounted to P11 million and were part of the personnel costs,” reads notes accompanying the BBS Bank results.
The local banker also reports that it was subjected to taxation for the first time at the reporting date due to fulfilling conditions that were part of the income tax exemption. As at the reporting date, BBS Limited recognised P2.4 million arising from the net deferred tax position. However, the BSE quoted banker says the Income tax losses will be utilized in line with the parameters prescribed by the Botswana Unified Revenue Services (BURS).
On the borrowing side, the country’s number mortgage lender experienced slow growth on the mortgage loans and advances book at the beginning of the year due to the need to repackage customer value proposition and increase focus on the transformation initiatives.
“However, there has been an improvement compared to the previous period,” says the board.
The financials also shows that the group recorded an increase in interest expense due to market liquidity constraints. The increase in interest costs impacted BBS’s margins with total deposits as at the reporting period standing at P3.02 billion compared to P2.7 billion as at 31 December 2022.
BBS Limited says while the bank has not yet achieved profitability, “the Board of Directors and Management are confident in the sustainability of the business and its potential growth. One of the key strategies for achieving profitability is to complete foundational banking capabilities in the medium term”.
The banker has successfully implemented its digital banking platform, “Nomad” which offers customers an improved banking experience.
Source: Sunday Standard
For More News And Analysis About Botswana Follow Africa-Press
