BancABC Half Year Financial Results 2011
17 August 2011
BancABC Half Year Financial Results 2011
AGENDA
• Highlights
• Economic overview
• Financial review
• Operational overview
• Strategy and outlook
BancABC Half Year Financial Results 2011
HIGHLIGHTS
Beki Moyo
Financial Highlights
4 BancABC Half Year Financial Results 2011
Total income increased by 24 % to BWP311 million
Cost to income ratio down to 72% from 77% in prior year
Operating expenses up by 18%
Operating profit increased by 48% to
BWP67 million
Pre-tax profit up by 84% to BWP63
million
Attributable profit to shareholders
increased by 33% to BWP37 million
Basic earnings per share improved by 33% to 25.9 thebe from 19.5 thebe in
2010
Financial Highlights (cont’d)
5 BancABC Half Year Financial Results 2011
Balance sheet grew by 23% from BWP6 billion in Dec
2010 to BWP7.4 billion (US$1.1
billion)
Loans and advances
increased by 31% from BWP3.1
billion in Dec 2010 to BWP4 billion
Customer deposits grew by 23% from BWP4.9 billion in
Dec 2010 to BWP6 billion
Net asset value per share up from
BWP2.87 to BWP3.09
Return on average equity was 17%
compared to 14% in 2010
Operational Highlights
6 BancABC Half Year Financial Results 2011
Total retail branches
increased to 21 as of now
compared to 13 in June 2010
US $50 million line of credit approved by
Afrexim board
Draw-down of IFC convertible loan of US$13.5m on 13th May 2011
NPLs down from 9.4% in June 2010 to 5.5%
BancABC Half Year Financial Results 2011
ECONOMIC OVERVIEW
Beki Moyo
8 BancABC Half Year Financial Results 2011
Economic Overview
Multi-speed global economic recovery continuing amid increasing risks
Increased Inflation
High oil & food prices
Rising demand
pressures
9 BancABC Half Year Financial Results 2011
Economic Overview
Multi-speed global economic recovery continuing amid increasing risks
Negative Surprises
Devastating earthquake &
Tsunami in Japan
Unrest in the MENA region – war in Libya
Debt crisis in Eurozone &
US
10 BancABC Half Year Financial Results 2011
Economic Overview
Multi-speed global economic recovery continuing amid increasing risks
• Economic growth somewhat
subdued
• Unemployment remains high
• Worries over debt
sustainability & contagion
effect
In developed countries
11 BancABC Half Year Financial Results 2011
Economic Overview
Multi-speed global economic recovery continuing amid increasing risks
• Capital inflows have been
strong
• Currencies have appreciated
• Strong signs of overheating
In emerging markets
12 BancABC Half Year Financial Results 2011
Economic Overview
Multi-speed global economic recovery continuing amid increasing risks
• Economic growth has been
strong
• High commodity prices a boon
to regional countries
• Inflation pressures building
In sub-Saharan Africa (SSA)
13 BancABC Half Year Financial Results 2011
Looming Financial Crisis due to Identical US - EU Debt Challenges
Economic Overview
US was downgraded by S&P from a top-notch AAA rating to AA+
Fears of Eurozone debt crisis Spreading to Italy & Spain – threat stability of €
Market jittery resulting in sell-off of risky assets
Investors have been seeking refuge in safe havens – Gold, Swiss Franc, etc..
Developments similar to the start of the 2008-2009 credit crisis
14 BancABC Half Year Financial Results 2011
Economic Overview
GDP Growth by Region
3.4
1.1
0.4
3.9
8.4
4.8
-2
0
2
4
6
8
10
09 10 11 12 09 10 11 12 09 10 11 12 09 10 11 12 09 10 11 12 09 10 11 12
AdvancedEconomies
Euro Area
MENA
Developing Asia
SSAGlobal Economy
Economic growth uneven across regions
15 BancABC Half Year Financial Results 2011
Platinum
Diamond Price
Nickel
Rice
Coal
Gold
Oil
Aluminum
Soyabeans
Copper
Coffee (arabica)
Cotton (A-Index)
Palladium
Maize
Wheat
0 20 40 60 80 100 120
13.9
14.0
15.6
16.8
21.5
24.0
27.7
32.5
37.1
39.5
44.0
65.2
66.2
103.4
107.0
%
Commodity Prices% Change Jun-10 to Jun-11
Firm commodity prices providing
impetus to growth in commodity-driven
Economies
16 BancABC Half Year Financial Results 2011
Economic Growth (%) & Size (USD m)
Economic growth from crisis induced slowdown is underway
Growth in most countries is fairly close to high levels of the mid-2000s
Botswana15,644
Tanzania23,739
Uganda16,386
Kenya35,787
Zambia18,298
Mozambique10,232
Zimbabwe8,998
Malawi5,637
Namibia13,471
2
4
6
8
10
4 5 6 7 8 9
GD
P G
row
th 2
011 (%
)
GDP Growth 2010 (% )
Bubble Size= GDP Size in US$ m
17 BancABC Half Year Financial Results 2011
Economic Overview - Inflation
-10
-5
0
5
10
15
20
J-09
F-0
9
M-0
9
A-0
9
M-0
9
J-09
J-09
A-0
9
S-0
9
O-0
9
N-0
9
D-0
9
J-10
F-1
0
M-1
0
A-1
0
M-1
0
J-10
J-10
A-1
0
S-1
0
O-1
0
N-1
0
D-1
0
J-11
F-1
1
M-1
1
A-1
1
M-1
1
J-11
SA
International food prices have
doubled
Fuel prices have surged
Inflation pressures are elevated
18 BancABC Half Year Financial Results 2011
GDP, Deposits & Credit Per Capita
* As of Dec-10
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
Bots Moza Tanz Zamb ZimbGDP/ Capita 7,689 512 551 1,182 516
Deposits/ Capita 3,515 161 150 274 179
Credit/ Capita 1,868 128 99 131 129
US$
GDP/ Capita
Deposits/ Capita
Credit/ Capita
Deposits/ GDP % 43 37 28 21 35
19 BancABC Half Year Financial Results 2011
Policy Interest Rates
Mon
eta
ryP
olicy T
igh
ten
ing
Monetary policies broadly accommodative except in Moz
15.5
15
11.5
10 109.5 9.5
14.514.5 13
11.5
14.5
15.5
16.5
5.8
11.2
5.6
6.1
2.9
5.2
4.3
14.1
15.915.6
8.3
6.6
8.37.8
0
5
10
15
Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11
20 BancABC Half Year Financial Results 2011
Exchange Rate Movement vs. USD
Ex Rate vs USD: Appreciation (-) & Depreciation (+)
Appreciationvs USD Depreciationvs USD
-16 -12 -8 -4 0 4 8 12 16
BWP
ZAR
MZN
TZS
ZMK
-7.5
-11.2
-16.9
14.7
-6.1
%
YoY: Jun-10 to Jun-11
On annual basis the following currencies appreciated vs USD:
•MZN: 16.9%•ZAR: 11.2%•BWP: 7.5%•ZMK: 6.1%
TZS depreciated vs USD by 14.7%
Continued weakening of TZS a
major cause of concern – imported
inflation
21 BancABC Half Year Financial Results 2011
Exch. Rates Movement vs. Pula
Dep
recia
tion
Ap
pre
cia
tio
n
Jun-10 to Jun-11
85
90
95
100
105
110
115
120
125
130
EX R
ate
Index, Jun
-10=
100
24
7.5
-10.1
ZAR/ BWP
MZN Appreciated by 10% vs. BWP
TZS Depreciated by 24% vs. BWP
22 BancABC Half Year Financial Results 2011
Banking Sector Status as of Apr-11
8,181
5,312
8,976
4,957
3,716
6,516
3,718
6,283
3,470
2,601
3,627
2,997
4,162
1,946
2,097
40
50
60
70
80
90
100
4 7 10 13 16 19 22 25 28 31 34 37 40
Loan
s/D
epos
it R
atio
, %
Number of Banks
Assets Deposits Loans
Tanzania
Zimbabwe
Zambia
Mozambique
Botswana
Bubble Size in US$ m
BancABC Half Year Financial Results 2011
FINANCIAL REVIEW
Beki Moyo
23
BancABC Half Year Financial Results 2011
Income Statement
24
BWP’000s H1-2011 % ∆
H1-201
0 FY-2010
Net interest income 191,354 30%
146,815 297,845
Impairment of loans & advances (25,821) -52% (16,996) (15,826)
Net interest income after impairments 165,533 28%
129,819 282,019
Non interest income 145,678 20% 121,622 264,288
Total income 311,211 24%251,44
1 546,307
Operating expenditure (244,025) -18%
(205,967)
(435,093)
Net income from operations 67,186 48% 45,474 111,214
Share of (loss)/profits of associates (4,547) 60% (11,479) (20,134)
Profit before tax 62,639 84% 33,995 91,080
Tax (23,529) -347% (5,269) (22,495)
Profit for the year 39,110 36% 28,726 68,585
Attributable to: - Ordinary
shareholders 37,242 33% 28,076 66,710
- Minorities 1,868 187% 650 1,875
Basic EPS 25.9 33% 19.5 46.3
Diluted EPS 24.6 26% 19.5 46.3
Performance primarily driven by growth in net
interest income and non-interest income
Impairments up due to loan growth and
downgrading of security in Tanzania
Opex increased in line with increased span of
activity
However, cost to income ratio down from
77% in 2010 to 72%
BancABC Half Year Financial Results 2011
Income Statement (USD)
25
USD’000s H1-2011 % ∆
H1-201
0 FY-2010
Net interest income 29,172 37% 21,241 43,873
Impairment of loans & advances (3,936) -60% (2,459) (2,331)
Net interest income after impairments 25,236 34% 18,782 41,542
Non interest income 22,208 26% 17,597 38,930
Total income 47,444 30% 36,379 80,472
Operating expenditure (37,201) -25% (29,800) (64,089)
Net income from operations 10,243 56% 6,579 16,383
Share of (loss)/profits of associates (693) 58% (1,661) (2,966)
Profit before tax 9,550 945 4,918 13,417
Tax (3,587) -371% (762) (3,314)
Profit for the year 5,963 43% 4,156 10,103
Attributable to: - Ordinary
shareholders 5,678 40% 4,062 9,827
- Minorities 285 203% 94 276
Basic EPS 3.9 39% 2.8 6.8
Diluted EPS 3.7 32% 2.8 6.8
Performance primarily driven by growth in net interest income and non-interest income
Impairments up due to loan growth and continued impairment of security for NPLs in Tanzania
Opex increased in line with increased span of activity
However, cost to income ratio down from 77% in 2010 to 72%
BancABC Half Year Financial Results 2011
Attributable Profit Trends
26
Improvement in sustainable earnings
(NII, fees and commissions)
Current period profitability driven by:• Higher net interest income
from better margins and higher asset base
• Higher transactional and bond trading income
Profitability was negated by:• Lower trading income in
Zambia and Mozambique• Higher effective tax rate
compared to prior year
BancABC Half Year Financial Results 2011
Income Statement – Segmental Analysis
27
Attributable Profit
BWP 000’s 2011 % Cont 2010 % Cont
% chang
e
BancABC Botswana 10,883 15% 11,147 25% -2%
BancABC Mozambique 7,823 11% 13,350 29% -41%
BancABC Tanzania 9,941 14% 5,893 13% 69%
BancABC Zambia 6,200 8% 7,547 17% -18%
BancABC Zimbabwe 38,422 52% 7,374 16% 421%
Banking operations 73,269 100% 45,311 100% 62%
Head Office(36,027
) (17,235) -109%
TOTAL 37,242 28,076 33%
BancABC Half Year Financial Results 2011
Income Statement – Segmental Analysis (USD)
28
Attributable Profit
USD 000’s 2011 % Cont 2010 % Cont
% chang
e
BancABC Botswana 1,659 15% 1,613 25% 3%
BancABC Mozambique 1,193 11% 1,932 29% -38%
BancABC Tanzania 1,515 14% 853 13% 78%
BancABC Zambia 946 8% 1,091 17% -13%
BancABC Zimbabwe 5,857 52% 1,067 16% 449%
Banking operations 11,170 100% 6,556 100% 70%
Head office (5,492) (2,494) -120%
TOTAL 5,678 4,062 40%
BancABC Half Year Financial Results 2011
Income Statement – Segmental Analysis
29
Total Income (BWP’000)
Jun-2011 Jun-2010%
change Dec-2010
BancABC Botswana 48,460 38,296 27% 84,964
BancABC Mozambique 43,171 48,797 -12% 83,967
BancABC Tanzania 45,376 31,351 45% 67,855
BancABC Zambia 45,248 40,634 11% 91,564
BancABC Zimbabwe 112,478 59,484 89% 140,449
Banking operations 294,733 218,562 35% 468,799
Head office entities 16,478 32,879 -50% 77,508
TOTAL 311,211 251,441 24% 546,307
Strong growth in income other than for Mozambique and head office entities
BancABC Half Year Financial Results 2011
Income Statement – Segmental Analysis
30
Total Income (BWP’000)
Wholesale Retail
Jun-2011 Jun-2010 Jun-2011 Jun-2010
BancABC Botswana 46,003 38,296 2,457 -
BancABC Mozambique 39,843 48,163 3,328 634
BancABC Tanzania 43,860 31,351 1,516 -
BancABC Zambia 41,578 40,634 3,670 -
BancABC Zimbabwe 88,029 53,868 24,449 5,616
Banking operations 259,313 212,312 35,420 6,250
Head office entities 16,478 32,879 - -
TOTAL 275,791 245,191 35,420 6,250
Income growth from both the retail and wholesale lines of business
BancABC Half Year Financial Results 2011
Income Statement – Net Interest Income
31
Positive trend in net interest income driven by better liquidity and increased balance sheet size
Slight reduction in net interest margins although
still high at 6.5%
Jun-07 Jun-08 Jun-09 Jun-10 Jun-11 -
50,000
100,000
150,000
200,000
250,000
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Net interest margin
Net int BWP'000 NIM before impairments NIM after impairments
BW
P '0
00
BancABC Half Year Financial Results 2011
Net interest margins by entity
32
Net Interest Margin Before Impairments
Net Interest Margin After Impairments
BancABC Half Year Financial Results 2011
Income Statement – Segmental Analysis
33
Net Interest Income (BWP’000)
Jun-2011 Jun-2010%
change Dec-2010
BancABC Botswana 29,870 23,076 29% 51,452
BancABC Mozambique 20,467 15,575 31% 29,057
BancABC Tanzania 24,577 22,416 10% 48,038
BancABC Zambia 38,064 32,512 17% 67,331
BancABC Zimbabwe 65,350 18,015 263% 57,443
Banking operations 178,328 111,594 60% 253,321
Head office entities 13,026 35,221 -63% 44,524
TOTAL 191,354 146,815 30% 297,845
Strong growth in NII other than from head office entities
BancABC Half Year Financial Results 2011
Income Statement – Impairments & NPLs
34
Impairment and credit loss ratios declined
due to improved credit risk management
processes
Tanzania net NPLs down to 1.3% from
5.3% in prior year due to increase in
provisions
Zimbabwe impairments increased
from an increased book
Net NPLs now 1.9% from 2.9% in prior
year
BancABC Half Year Financial Results 2011
Income Statement – Non-Interest Income
35
Substantial growth in fees and commissions as customer transactions increased
Bond trading income also increased, but trading income down in Mozambique and Zambia
Zimbabwe and Tanzania were main contributors to growth in non-interest income
BancABC Half Year Financial Results 2011
Income Statement – Cost to Income Ratio
36
Costs increased 18% YoY due to Retail banking expansion
However, growth in revenues more than increase in costs. Cost to income ratio is now trending downwards
Staff cost were BWP125 million (H1 10: BWP113 million)
BancABC Half Year Financial Results 2011
Income Statement – Opex by entity
37
BancABC Half Year Financial Results 2011
Income Statement – Segmental Analysis
38
Operating expenses (BWP’000)
Wholesale Retail
Jun-2011 Jun-2010 Jun-2011 Jun-2010
BancABC Botswana 26,388 21,536 10,425 3,429
BancABC Mozambique 21,266 21,901 11,678 7,375
BancABC Tanzania 25,157 18,770 5,055 3,613
BancABC Zambia 36,158 31,388 2,889 1,699
BancABC Zimbabwe 44,520 43,950 17,293 5,369
Banking operations 153,489 137,545 47,340 21,485
Head office entities 39,402 41,638 3,794 5,299
TOTAL 192,891 179,183 51,134 26,784
Growth in costs mostly driven by expansion into the retail and SME market segment
BancABC Half Year Financial Results 2011
Balance Sheet
39
BWP '000s Jun 2011 Jun 2010%
change Dec 2010
Cash and short term funds 1,356,617 717,669 89% 999,338
Financial assets held for trading 1,030,839 1,423,014 -28% 1,117,827
Financial assets designated at fair value 84,135 4,133 >100% 79,139
Loans and advances 4,018,987 2,341,744 72% 3,078,110
Property and equipment 392,799 302,612 30% 330,218
Other assets 481,861 332,351 45% 406,809
TOTAL ASSETS 7,365,238 5,121,523 44%6,011,44
1
Deposits 6,004,301 4,132,382 45% 4,907,045
Borrowed funds 682,839 471,634 45% 579,420
Other liabilities 208,610 81,101 157% 87,116
Total liabilities 6,895,750 4,685,117 47%5,573,58
1
Equity attributable to ordinary shareholders 453,116 420,189 8% 422,337
Minority interest 16,372 16,217 1% 15,523
Total equity 469,488 436,406 8% 437,860
TOTAL EQUITY AND LIABILITIES 7,365,238 5,121,523 44%6,011,44
1
BancABC Half Year Financial Results 2011
Balance Sheet (USD)
40
USD '000s Jun 2011 Jun 2010%
changeDec
2010
Cash and short term funds 207,562 101,514 104% 154,997
Financial assets held for trading 157,707 201,285 -22% 173,375
Financial assets designated at fair value 12,884 585 >100% 12,274
Loans and advances 614,905 331,240 86% 477,415
Property and equipment 60,098 42,805 40% 51,217
Other assets 73,725 47,012 57% 63,097
TOTAL ASSETS 1,126,881 724,441 56% 932,375
Deposits 918,658 584,525 57% 761,083
Borrowed funds 104,474 66,713 57% 89,868
Other liabilities 31,917 11,473 178% 13,512
Total liabilities 1,055,049 662,711 59% 864,463
Equity attributable to ordinary shareholders 69,327 59,436 17% 65,504
Minority interest 2,505 2,294 9% 2,408
Total equity 71,832 61,730 16% 67,912
TOTAL EQUITY AND LIABILITIES 1,126,881 724,441 56% 932,375
BancABC Half Year Financial Results 2011
Balance Sheet – Overview
41
23% growth in balance sheet during the last six months
from BWP6bn to BWP7.4bn
Deposits up 23% during the last six months• Growth across all the
markets• Significant growth from
BancABC Zimbabwe
Loans and advances up 31% during the period• Significant growth in
Zimbabwe• Quality of the book has
improved - NPL ratio declined
BancABC Half Year Financial Results 2011
Balance Sheet – Loans and Advances
42
BancABC Zimbabwe is largest contributor to Group’s loan book
Growth experienced in all markets other than Tanzania
BancABC Half Year Financial Results 2011
Balance Sheet – Segmental Analysis
43
Loans and advances (BWP’000)
Wholesale Retail
Jun-2011 Jun-2010 Jun-2011 Jun-2010
BancABC Botswana 825,315 663,344 14,490 -
BancABC Mozambique 500,338 356,580 40,478 3,621
BancABC Tanzania 418,976 475,622 22,277 899
BancABC Zambia 223,709 252,215 62,285 -
BancABC Zimbabwe 1,354,846 325,234 145,817 21,773
Banking operations 3,323,184 2,072,995 285,347 26,293
Head office entities 410,456 242,456 - -
TOTAL 3,733,640 2,315,451 285,347 26,293
Retail contribution has significantly grown in the last 12 months
BancABC Half Year Financial Results 2011
Balance Sheet – Deposits
44
Growth in deposits experienced across the footprint
Funds raised predominantly used to fund loans & advances and short-term placements
Botswana still largest contributor to Group deposits
Zimbabwe second largest contributor
BancABC Half Year Financial Results 2011
Balance Sheet – Segmental Analysis
45
Deposits (BWP’000)
Wholesale Retail
Jun-2011 Jun-2010 Jun-2011 Jun-2010
BancABC Botswana 1,929,167 1,769,212 55,079 -
BancABC Mozambique 822,667 738,195 159,648 15,258
BancABC Tanzania 972,753 761,395 14,796 3,375
BancABC Zambia 375,629 253,980 18,229 -
BancABC Zimbabwe 990,578 561,748 665,755 27,419
Banking operations 5,090,794 4,084,530 913,507 46,052
Head office entities - 1,800 - -
TOTAL 5,090,794 4,086,330 913,507 46,052
Retail now contributing 15% of total deposits (June 2010: 1%)
BancABC Half Year Financial Results 2011
Balance Sheet – Capital Adequacy
46
Total Equity (BWP m)
Capital Adequacy Ratio
Subsidiary 2011 2010 Min 2011 2010
BancABC Botswana 173 166 15% 20% 22%
BancABC Mozambique 177 135 8% 22% 18%
BancABC Tanzania 132 133 12% 15% 14%
BancABC Zambia 89 83 10% 21% 30%
BancABC Zimbabwe 216 113 10% 15% 14%All entities are adequately capitalised
BancABC Half Year Financial Results 2011
OPERATIONAL OVERVIEW
Francis Dzanya
47
48 BancABC Half Year Financial Results 2011
Operations Summary
› 21 Retail branches as of now
› Staff compliment now
Botswana Mozambique
Tanzania Zambia Zimbabwe
SquareFairgroundsFrancistown
MaputoBeira
MatolaTete
Chimoio
UpangaKariakoSinza
(agency)
Pyramid Plaza
LumumbaKitweNdola
Mount PleasantHeritageAbercornMutareChiredziKwekweABCH Group
736 Employees
Botswana
BancABC Botswana
118 Employees
Mozambique
BancABC Mozambique103 Employees
Tanzania
BancABC Tanzania
92 Employees
Zambia
BancABC Zambia
152 Employees
Zimbabwe
BancABC Zimbabwe
219 Employees
South Africa
100% 100% 94% 100% 100%
BancABC South Africa52 Employees
100%
49 BancABC Half Year Financial Results 2011
Operations Summary
Retail rollout continuing with a Group target of at least 30 branches by year-end• Technology has been a challenge
slowing down implementation• Issues being addressed and rollout
of key functionality to continue
In-roads made into the wholesale market in all
markets and microfinance in Zambia
Significant reduction in Consumer Lending (“Microfin”) rates
following introduction of 48 months loans
BancABC Half Year Financial Results 2011
Operations Overview – Head Count
50
Total head count in 2011 of 736 vs 612 in June 2010
Growth in staff numbers in last 12 months due to retail expansion
Botswana Highlights
51 BancABC Full Year Financial Results 2010
• Revenue increased significantly by 27%:• Net interest income up 29% -
stable margins and increased interest earning assets
• Non-interest income up 18% - higher transaction and trading income
• Opex up 47% from increased activity around retail expansion
• Tax optimisation measures reduced overall tax bill shielding impact of higher costs on profitability
PAT flat at BWP11 million
• Customer deposits increased 1% since Dec 2010 to BWP2 billion;
• loans and advances increased 6% since Dec 2010 to BWP0.8 billion
Balance sheet increased 9%
BancABC Half Year Financial Results 2011
Mozambique Highlights
52
• Total income down 12%:• Net interest income up
31% - improved margins and increased interest earning assets
• Non-interest income down 27% - lower foreign exchange trading income due to lower margins and volumes
• Opex up 13% from increased activity around retail expansion
PAT of BWP8m, 41% lower than prior year
• Deposits up 17% since Dec 2010 to BWP1 billion
• Loans and advances increased by 27% since Dec 2010 to BWP0.5 billion
Total Balance Sheet up 24%
BancABC Half Year Financial Results 2011
Tanzania Highlights
53
• Net interest income up 10% owing to higher balance sheet
• Non-interest income increased by 72% - bond trading income major driver of growth
• However, impairments up 17% to BWP11.5 million
• Total income therefore only 45% ahead of prior year
• Opex increased by 35% - expansion into Retail and SME segment
Attributable profit of BWP10 million, 69% ahead of prior year
• Deposits up 24% since Dec 2010 to BWP1 billion
• Loan book declined 1% since Dec 2010 to BWP0.4 billion – efforts focused more into stabilisation of book to control NPLs
• Funds raised mostly invested in money market investments
Balance sheet remained highly
liquid and grew by 19% since Dec
2010
BancABC Half Year Financial Results 2011
Zambia Highlights
54
• Total income up 11% driven primarily by growth in the microfinance net interest income
• NII increased by 17% - growth driven by introduction of new microfinance products and restructuring of the existing ones
• Wholesale banking division business growth subdued
• Opex increased 18% from retail footprint expansion
PAT of BWP6 million down 18% from prior year
• Deposits increased 56% since Dec 2010 to BWP0.4 billion on back of improved market confidence in the bank
• Loan book grew in the microfinance division but was down on wholesale – overall growth 23% since Dec 2010 to BWP0.3 billion
Balance sheet now more liquid
BancABC Half Year Financial Results 2011
Zimbabwe Highlights
55
• Deposits increased 57% since Dec 2010 to BWP1.7 billion
• Loans and advances increased 68% since Dec 2010 to BWP1.5 billion
• Net interest income grew 3.5 times on back of similar growth in loans and advances
• Non-interest income up 29% from increased transactions
• Portfolio impairments up from BWP1 million to BWP8 million in the current period – loan book growth
• Opex increased 25% due to continued expansion into the retail space
PAT up 5 fold to BWP38 millionBalance sheet continues growing significantly
56 BancABC Half Year Financial Results 2011
Zimbabwe: Share of Loans by Banking Institution
22-Smaller Banks 49%
CBZ 26%
SCB 8%
Stanbic 8%
BBZ 2%ABC 7%
5-Largest Banks 51%
Share of Loans as of Jun-10
22-Smaller Banks52%
CBZ 25%
SCB 6%Stanbic
5% BBZ 2%
ABC 10%
5-Largest Banks47%
Share of Loans as of Jun-11
57 BancABC Half Year Financial Results 2011
Zimbabwe: Share of Deposit as of Jun-10
22- Smaller Banks44%
CBZ21%
SCB10%
Stanbic12%
BBZ7%
ABC6%
5-Largest Banks56%
58 BancABC Half Year Financial Results 2011
Zimbabwe: Share of Deposit as of Jun-11
22- Smaller Banks40%
CBZ 22%
SCB 8%
Stanbic 11%
BBZ 6%
ABC 11%
5-Largest Banks59%
59 BancABC Half Year Financial Results 2011
Zimbabwe: Banks’ Capitalization Status as of 30 June 2011
1.0 2.8
13.4
13.6
13.7
16.6
18.2
18.3
18.5
18.5
21.8 30.1
31.0
32.0 4
4.3 51.6
CBZStanchartBarclays
Stanbic
BancABCZBFBCNMB
InterfinMetbank
Agribank
MBCA
Trust
Kingdom
TN
Royal
BancABC Half Year Financial Results 2011
STRATEGY AND OUTLOOK
Francis Dzanya
BancABC Half Year Financial Results 2011
Short to medium term objectives
61
Grow the microfinance book in
Zambia
Open additional branches across the
footprint
Additional capital required in all
subsidiaries, but BancABC Zimbabwe
and BancABC Tanzania are priority
Additional capital raise being explored
including private placement to raise
additional Tier I capital
BancABC Half Year Financial Results 2011
Dividend declaration
62
As per Group dividend policy, an interim gross dividend of 6.8 thebe per share to be paid out on 16th September 2011 to shareholders on register on 2nd September 2011
Outlook
63 BancABC Full Year Financial Results 2010
Short-term prognosis points to a tough banking environment• Sovereign debt problems in
EU and US• Increasing competition
However, operating countries relatively
stable politically and economically
Operating markets are growing and new
opportunities exist
Medium term outlook positive for Group
BancABC Half Year Financial Results 2011
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