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ABC Holdings Limited Audited Group Results
for the year ended31 December 2012
26 March 2013
BancABC Full Year Financial Results 2012 2
- Highlights
- Economic review
- Operational overview
- Financial review
- Strategy and outlook
Agenda
BancABC Full Year Financial Results 2012 3
Douglas Munatsi
Highlights
BancABC Full Year Financial Results 2012 4
Financial highlights
BWP Dec-12 Dec-11 ∆ TrendAttributable Profits 132.8m 83.0m +60%
Dividend Per Share 0.16 0.175 -9%
No of shares in issue 232.8m 149.5m +56%
NAV Per Share 4.88 3.99 +22%
● Strong underlying Group performance● Improving capital base and NAV per share● Successfully raised BWP364 million by way of
rights issue in July 2012
BancABC Full Year Financial Results 2012 5
Financial highlights
● Growth in profitability from increased business volume
● Retail expansion● Cost to income ratio down due to higher revenues
BWP Dec-12 Dec-11 ∆ Trend
PBT 212.3m 107.7m + 97%
PAT 135.2m 87.7m +54%
ROE 15.3% 16.3% -1.0%
Cost To Income
71% 74% -3.0%
EPS 72.1 thebe 56.6 thebe +27%
BancABC Full Year Financial Results 2012 6
Financial highlights
● Strong growth in volumes across the board● Diversification into retail lending● Successful rights issue in July 2012
BWP Dec-12 Dec-11 ∆ TrendTotal Assets 13.4 billion 9.2 billion +46%
Loans & Advances
9.1 billion 6.1 billion +50%
Deposits 10.7 billion 7.4 billion +45%
Total Equity 1.1 billion 0.6 billion +89%
BancABC Full Year Financial Results 2012 7
Operational highlights
Total retail branches increased from 49 in Dec-11
to 61 in Dec-12
Total retail customer numbers increased by 131% from
101,922 in Dec-11 to 235,070 in Dec-12
NPLs at 9.2% from 6.6% in prior year, credit loss ratio at
1.8% compared to 1.7% in 2011
BancABC Full Year Financial Results 2012 8
Douglas Munatsi
Economic overview
BancABC Full Year Financial Results 2012
Global economic development
Global GDP growth to reach 3½% in 2013, up from 3¼%
Coordinated policy actions reduced acute crisis risks in the Euro area and the US.
Emerging economies recovery being led by China, India & Brazil. Growth is returning to healthy levels
BancABC Full Year Financial Results 2012
GDP growth in selected leading economies
-1.0
1.0
3.0
5.0
7.0
9.0
11.01.
8
3.1
1.7
-0.6
0.9
4.3
9.3
7.9
2.7
3.5 3.
9
2.3
0.9
0.2
2
-0.2
3.6
7.8
4.5
1
2.3
3.2
2.0
0.6
0.3
1.2
1.0
3.7
8.2
5.9
3.5
2.8
3.5
% 2011 2012 2013
10
BancABC Full Year Financial Results 2012
Risks to global economy
Global Econom
y
Renewed Euro Area Stress
US Severe Fiscal Stand-off
Egypt renewed economic/Politi
cal deterioration Japan
escalation of tensions with China over
islands
Oil price instability
11
BancABC Full Year Financial Results 2012
Economic growth in selected African countries
0
2
4
6
8
10
3.9
4.4
4.3
4.9
6.4
5.1
7.1
6.6
9.4
3.5
5.3
6.8
5.1
4.3
4
6.5
3.8
7.5
6.5
4.4
2.3
4.8
5.5 5.6 5.7
4.1
6.8
4.1
8.4
8.3
5.0
2.8
5.8
2011 20122013%
12
BancABC Full Year Financial Results 2012
Economic growth in selected African economies
Economic growth in SSA to improve to 5.8% in 2013 compared to 4.8% in 2012
Most countries in SSA vulnerable to any global downturn
Strong growth in ABC markets although Zim slowed down from near double digit level in 2011
13
BancABC Full Year Financial Results 2012
Inflation developments in selected markets in 2012
Low inflation environment in Zimbabwe & MozambiqueDouble digit YoY inflation level in Tanzania
Above target inflation in Botswana & South Africa
Inflation breached 7% mark in Dec-12 in Zambia
7.6
2.6
16.1
6.6
3.7
5.7
0
4
8
12
16
20
Inflation
Avg Inflation
Botswana Mozamb Tanzania Zambia Zimbabwe SA
I have made changes
14
BancABC Full Year Financial Results 2012
Monetary policy rates
PolicyRate %Dec-11
Policy Rate %Dec-12
% Change
Comment
Botswana(Bank Rate) 9.5 9.5 0.0 Policy rate fixed at 9.5% since Dec-10
Mozambique( Overnight Rate) 15.0 9.5 -5.50 Policy easing cycle – interest rate
lowered 5-times during 2012
Tanzania(91-dy TB Rate) 12.61 11.89 -0.72 TB Rate was broadly stable indicating
neutral policy stance
Zambia(BoZ Policy Rate) 9.0 9.25 +0.25
New BoZ rate introduced in Apr-12 BoZ rate increased so as to combat inflation
Zimbabwe(91-dy TB Rate) ---- 8.51 ---- Maiden TB issued in Oct-12
Low uptake due to tight liquidity
15
BancABC Full Year Financial Results 2012
Lending and deposit interest rates
4
6
8
10
12
4
6
8
10
12
Dec-
09
Apr-
10
Aug-1
0
Dec-
10
Apr-
11
Aug-1
1
Dec-
11
Apr-
12
Aug-1
2
Dec-
12
Botswana
Prime Lending
Deposit Rate
8
10
12
14
16
18
20
8
10
12
14
16
18
20
Dec-
09
Apr-
10
Aug-1
0
Dec-
10
Apr-
11
Aug-1
1
Dec-
11
Apr-
12
Aug-1
2
Dec-
12
Mozambique
Prime Lending
16
BancABC Full Year Financial Results 2012
Lending and deposit interest rates
6
8
10
12
14
16
6
8
10
12
14
16
Dec-
09
Apr-
10
Aug-
10
Dec-
10
Apr-
11
Aug-
11
Dec-
11
Apr-
12
Aug-
12
Dec-
12
Tanzania
Prime Lending
Deposit Rate
6
10
14
18
22
6
10
14
18
22
Dec-
09
Apr-
10
Aug-
10
Dec-
10
Apr-
11
Aug-
11
Dec-
11
Apr-
12
Aug-
12
Dec-
12
Zambia
Deposit Rate
17
BancABC Full Year Financial Results 2012
Lending and deposit interest rates
0
5
10
15
20
25
30
35
40
0
5
10
15
20
25
30
35
40
Dec
-10
Feb
-11
Apr-
11
Jun
-11
Aug
-11
Oct
-11
Dec
-11
Feb
-12
Apr-
12
Jun
-12
Aug
-12
Oct
-12
Dec
-12
Zimbabwe
Savings rates
Lendin
g R
ates
Quoted lending rates vary widely in Zimbabwe
This is a reflection of different cost structures among banks in mobilising deposits
The Central Bank recently introduced caps and floors on interest rates
18
BancABC Full Year Financial Results 2012
Exchange rate movement US$ vs. ZAR
ZAR volatility persisted in 2012 influenced by both domestic & global factors In 2013, ZAR broadly trading in the 8.75 – 9.25 range vs. USD
7.2
7.5
7.8
8.1
8.4
8.7
9.0
7.2
7.5
7.8
8.1
8.4
8.7
9.0
Jan
-12
Feb
-12
Mar
-12
Apr-
12
May
-12
Jun
-12
Jul-
12
Aug
-12
Sep
-12
Oct
-12
Nov
-12
Dec
-12
Jan
-13
US$/ ZAR
H1 Average
H2 Average
19
BancABC Full Year Financial Results 2012
Exchange Rate Movement vs. USD
23.6
16.9
-17.5
7.7
6.7
3.7
3.3
9
0.6
-20 -10 0 10 20 30
ZAR
BW
PM
ZNTZ
SZM
K
2012
2011
DepreciationAppreciation
Dec-11 to Dec 12, currencies depreciated vs. USD:o MZN (9%)o ZAR (3.7%)o BWP (3.3%)o ZMK (0.6%)
TZS was broadly stable supported by Central Bank intervention
20
BancABC Full Year Financial Results 2012 21
Exchange Rate Movement per Pula
ZMK & TZS appreciated against the BWP over the period Dec-11 to Dec-12 MZN weakened by 5.5% vs. BWP
ZAR has dominant weight in BWP basket of currency
ZAR weakness transmitted to BWP
630
660
690
720
750
780
Dec
-10
Feb-
11
Apr-1
1
Jun-
11
Aug-
11
Oct
-11
Dec
-11
Feb-
12
Apr-1
2
Jun-
12
Aug-
12
Oct
-12
Dec
-12
BWP/ZMK
190200210220230240250
Dec
-10
Feb-
11
Apr-1
1
Jun-
11
Aug-
11
Oct
-11
Dec
-11
Feb-
12
Apr-1
2
Jun-
12
Aug-
12
Oct
-12
Dec
-12
BWP/TZS
3.0
3.5
4.0
4.5
5.0
5.5
Dec
-10
Feb-
11
Apr-1
1
Jun-
11
Aug-
11
Oct
-11
Dec
-11
Feb-
12
Apr-1
2
Jun-
12
Aug-
12
Oct
-12
Dec
-12
BWP/MZN
BancABC Full Year Financial Results 2012
Financial inclusion levels in selected African countries
12%
12%
14%
19%
23%
24%
30%
41%
63%
1%
4%
9%
7%
18%
14%
6%
18%
5%
9%
28%
14%
19%
26%
22%
17%
8%
5%
78%
56%
63%
55%
33%
40%
47%
33%
27%
0% 20% 40% 60% 80% 100%
Mozambique '09
Tanzania '09
Zambia '09
Malawi' 08
Kenya '09
Zimbabwe '11
Nigeria '10
Botswana '09
SA '11
Banked Non-banked formal Informal Only Excluded
22
BancABC Full Year Financial Results 2012
Financial intermediation – Credit to GDP Ratio Lending to privates
sector exceeded 2008/09 pre-crisis level
Financial intermediation in ABC markets still lags that of middle income countries such as SA
Majority of the population remains unbanked
0 20 40 60 80
SA
Zimbabwe
Mozambique
Botswana
Tanzania
Zambia
% of GDP
2012
2009
23
BancABC Full Year Financial Results 2012 24
Banking assets and deposits
Exponential market growth across ABCH footprint
Tanzania is the largest market followed by Botswana and Mozambique
BancABC Full Year Financial Results 2012 25
Market share
● Growing market share, especially in Botswana and Zimbabwe
● Need to grow to critical mass in other markets as well
BancABC Full Year Financial Results 2012 26
Francis Dzanya
Operational overview
BancABC Full Year Financial Results 2012 27
BancABC Botswana highlights
• NII: 218% higher• Balance sheet growth –
consumer lending• Non-interest income: up
57% from increased customer transactions
• Loans: up BWP1.7bn to BWP3.4bn
• Payroll deduction loans• NPLs: down from 2.2% in
Dec-11 to 1.2% in Dec-12• Deposits: up BWP1.7bn to
BWP4.3bn
• Consolidation of growth to date
• Consumer lending and home loans
• Increased cross-sell of retail products
• Risk management (credit, liquidity and operational)
Outstanding Performance
Statistics 2011 2012 change
Staff compliment 187 234 +47
Total Branches 4 6 +2
Total Customers 9177 28,735 +19558
Income statement Loans and Deposits Outlook
BancABC Full Year Financial Results 2012 28
BancABC Mozambique highlights
Revenue
• NII: +52%• Balance sheet growth• Higher margins• Impairments: up from
BWP5m to BWP18m• Non-interest income: +3%
lower Fx trading income
Loans and Deposits
• Loans: +BWP115m to BWP877m
• Gross NPLs increased from 4.5% to 8.4%
• Deposits: + BWP139m to BWP1.2bn
• Retail roll out – cards, internet banking, group loan schemes
• Manage NPLs• IFC SME Program
Outlook
Below Expectation
Statistics 2011 2012 change
Staff compliment 125 166 +41
Total Branches 6 8 +2
Total Customers 4,516 8,125 3,609
BancABC Full Year Financial Results 2012 29
BancABC Tanzania highlights
Revenue
• NII: -42% from BWP51m to BWP29m
• High cost of funds and larger NPL book
• Higher impairments• Non Interest Income:
+42% - high bond and Fx trading volumes
Loans and Deposits
• Loans: +BWP174m to BWP573m
• NPLs up from 15% to 33%• Deposits: +BWP87m to
BWP1.bn
• Consumer Lending following acquisition of payroll deduction code
• Increased transactions with small traders association
• Embed rollout of retail products
Outlook
Below Par Performance
Statistics 2011 2012 change
Staff compliment 103 135 +32
Total Branches 4 5 +1
Total Customers 1,601 5,979 +4,378
BancABC Full Year Financial Results 2012 30
BancABC Zambia highlights
Revenue
• NII: +6% despite cap on interest rates
• Non-interest income: +224% increased transaction volumes
• Growth in consumer loans• Increased trade finance
transactions
Loans and Deposits
• Loans: +BWP0.5bn to BWP1.0bn
• Growth mostly on consumer lending book
• NPLs: down from 4.5% to 3.3% in Dec-12
• Deposits:+ BWP0.3bn to BWP0.8bn
• Consolidate growth and improve funding mix
• Grow deposit base• Continue growing
wholesale business• Embed rollout of retail
products – increase cross-sell
Outlook
Solid Performance
Statistics 2011 2012 change
Staff compliment 187 211 +24
Total Branches 19 21 +2
Total Customers 52,512 82,449 +29,937
BancABC Full Year Financial Results 2012 31
BancABC Zimbabwe highlights
Revenue
• NII: 87% higher• Balance sheet growth -
group scheme loans• Impairments up 32%• Non-interest income: up
65% from increased customer transactions
Loans and Deposits
• Loans: +BWP1bn to BWP3bn
• Liquidity crunch• NPLs: up from 5.8% in Dec-
11 to 14.2%• Deposits:+ BWP1.1bn to
BWP3.1bn
• Banc Easy Group loan schemes
• Mortgage loans and VAF,• Embed rollout of retail
products – increase cross-sell
• Risk management (credit, liquidity and operational)
Outlook
Robust Performance
Statistics 2011 2012 change
Staff compliment 352 507 +155
Total Branches 16 21 +5
Total Customers 34,966 109,782 +74,816
BancABC Full Year Financial Results 2012 32
Beki Moyo
Financial review
BancABC Full Year Financial Results 2012 33
Income statementBWP'000 Dec-12 % ∆ Dec-11Net interest income 673,034 63% 412,362
Impairment of loans (138,172) -74% (79,537)NII after impairment of loans 534,862 61% 332,825
Non-interest income 551,700 69% 325,984
Total income1,086,56
2 65% 658,809
Operating expenses (868,659) -59% (545,948)Net income from operations 217,903 93% 112,861
Share of loss of associates (5,630) -9% (5,177)
Profit before tax 212,273 97% 107,684
Tax (77,108) -286% (19,986)
Profit for the year 135,165 54% 87,698
Attributable to:
-Ordinary shareholders 132,774 60% 83,002
-Minority interests 2,391 -49% 4,696
Basic EPS (thebe) 72.1 27% 56.6
Diluted EPS (thebe) 66.5 17% 56.6
Dividend per share (thebe) 16.0 -9% 17.5
Strong performance driven by growth in consumer lending in
Botswana, Zambia and Zimbabwe
Higher impairments – growth in loan book and higher NPLs in Tanzania
and Zimbabwe
Expansion generated higher costs, but cost to
income ratio declined
Dividends lower due to increased no of shares
BancABC Full Year Financial Results 2012 34
Income statementUSD'000 Dec-12 % ∆ Dec-11Net interest income 88,571 47% 60,329
Impairment of loans (18,183) -56% (11,637)NII after impairment of loans 70,388 45% 48,692
Non-interest income 72,604 52% 47,692
Total income 142,992 48% 96,384
Operating expenses (114,316) -43% (79,873)Net income from operations 28,676 74% 16,511
Share of loss of associates (741) 2% (757)
Profit before tax 27,935 77% 15,754
Tax (10,147) -247% (2,924)
Profit for the year 17,788 39% 12,830
Attributable to:
-Ordinary shareholders 17,473 44% 12,143
-Minority interests 315 -54% 687
Basic EPS (US cents) 9.5 14% 8.3
Diluted EPS (US cents) 8.7 5% 8.3
Dividend per share (US cents) 2.1 -13% 2.4
Strong performance driven by growth in consumer lending in
Botswana, Zambia and Zimbabwe
Higher impairments – growth in loan book and higher NPLs in Tanzania
and Zimbabwe
Expansion generated higher costs, but cost to
income ratio declined
Dividends lower due to increased no of shares
BancABC Full Year Financial Results 2012 35
Profitability trends
Growth in core earnings as retail contribution
increases
2009 dip in line with commencement of retail
rollout
ROE marginally down – higher capital base and
loss in Tanzania
BancABC Full Year Financial Results 2012 36
Income statement – segmental analysis
Attributable profits
BWP'000 2012 % Cont 2011 % Cont % change
Botswana 94,434 44% 28,005 20% 237%
Mozambique 17,562 8% 28,863 20% -39%
Tanzania (38,579) (18%) (3,326) -2% >-100%
Zambia 36,004 17% 31,872 23% 13%
Zimbabwe 103,351 49% 55,090 39% 88%
Banking Operations 212,772 100% 140,504 100% 51%Head office & consolidation adjustments (79,998) (57,502) -39%
Total 132,774 83,002 60%
High profit growth in Botswana and Zimbabwe – consumer lending
Zambia growth despite tax charge in current year – prior year tax credit
Challenges in Tanzania and to a lesser extent Mozambique
BancABC Full Year Financial Results 2012 37
Income statement – segmental analysis
Total income (exl. impairments) 2012 2011
BWP'000 Wholesale Retail Wholesale Retail
BancABC Botswana 185,858 138,856 114,301 11,040
BancABC Mozambique 138,817 20,796 114,796 11,273
BancABC Tanzania 70,691 12,575 83,517 5,071
BancABC Zambia 61,203 120,299 33,581 69,156
BancABC Zimbabwe 255,610 183,374 186,794 63,480
Banking Operations 712,179 475,900 532,989 160,020
Head Office & Consolidation adjustments 36,655 - 45,337 -
Total Income 748,834 475,900 578,326 160,020
● Retail income almost tripled from growth in Botswana and Zimbabwe – retail now contributing 39% (2011: 22%)
● Wholesale income growth, except in Tanzania
BancABC Full Year Financial Results 2012 38
Income statement – segmental analysis
● Growth in Botswana, Mozambique and Zimbabwe – higher volumes and better margins
● Zambia – restrictions on interest rate● Tanzania – high cost of funds and higher NPLs
Net interest income
BWP'000 2012 % change 2011
BancABC Botswana 252,338 216% 79,882
BancABC Mozambique 92,492 52% 60,703
BancABC Tanzania 29,391 (42%) 50,673
BancABC Zambia 71,759 4% 68,905
BancABC Zimbabwe 226,974 87% 121,575
Total Banking Operations 672,954 76% 381,738
Head office 80 (100%) 30,624
Total 673,034 63% 412,362
BancABC Full Year Financial Results 2012 39
Income statement – net interest income
● Improving margins despite setback in Tanzania● Consumer lending improved margins in Botswana, Zambia
and Zimbabwe● Mozambique had lower cost of funds● NII trending upwards – higher volumes
BancABC Full Year Financial Results 2012 40
NPLs and credit losses
● Gross NPL ratio higher at 9.2% (2011: 6.6%) – Tanzania and Zimbabwe
● Net NPLs at 6.1% compared to 3.3% in prior year● Credit loss ratio consequently higher – 1.8% (2011: 1.7%)
BancABC Full Year Financial Results 2012 41
Legal case
Client granted loan facility in late 2010 for diamonds
purchase
Client defaulted and renegotiated facility in 2011. Client defaulted again and settlement
agreed at $10.8m in early 2012
In 2012, client paid $6m of this
renegotiated amount and defaulted on
balance
In January 2013, BancABC Zimbabwe
intercepted funds and applied funds to full
facility + penalty interest
In February 2013, third party (beneficiary) obtained
judgement against Bank. Bank appealed to Supreme Court and judgement has
been reserved
Bank is on a strong position to win the case. If
we lose the case and client is not able to pay, net after tax impairment could be BWP37 million.
BancABC Full Year Financial Results 2012 42
Income statement – non-interest income
● Fees and commissions growth from increased transaction volumes
● Trading income mostly from Tanzania and Mozambique● With introduction of retail, composition of non-interest income
skewed more towards fees/commissions
BancABC Full Year Financial Results 2012 43
Operating expenses per entity
BWP'000 2012 % change 2011
BancABC Botswana 165,510 97% 84,024
BancABC Mozambique 115,436 43% 80,798
BancABC Tanzania 98,461 59% 61,762
Zambia 125,951 56% 80,674
Zimbabwe 270,219 82%
148,510
Banking operations 775,577 70%
455,768
Head office 93,082 3% 90,180
Total 868,659 59%
545,948
Increase in operating expenses across the board due to Retail &
SME Banking expansion
BancABC Full Year Financial Results 2012 44
Income statement – cost to income ratio
● Introduction of Retail Banking and dollarisation in Zimbabwe increased cost to income ratio in 2009
● Retail contribution to income increasing thereby resulting in lower cost to income ratio
BancABC Full Year Financial Results 2012 45
Income statement – opex per entity
Operating Expenses
Wholesale Retail
BWP'000 Dec-12 Dec-11 Dec-12 Dec-11
BancABC Botswana 62,137 55,282 103,373 28,742
BancABC Mozambique 66,973 53,409 48,463 27,389
BancABC Tanzania 70,572 47,613 27,889 14,149
BancABC Zambia 65,467 29,612 60,484 51,062
BancABC Zimbabwe 123,523 102,398 146,696 46,112
Banking Operations 388,672 288,314 386,905 167,454
Head office 85,211 83,380 7,871 6,800
Total 473,883 371,694 394,776 174,254
● Retail expense now 45% of total operating expenses compared to 32% in prior year
● Wholesale expenses up 27%, retail expenses up 127%
BancABC Full Year Financial Results 2012 46
Balance sheet overview
Balance sheet grew by 46% from BWP9.2 billion to BWP13.4 billion
Deposits grew by 45% from BWP7.4 billion to BWP10.7 billion
Loans and advances grew 50% from BWP6.1 billion to BWP9.1 billion mostly from growth in Botswana
Total Equity grew by 89% from BWP0.6 billion to BWP1.2 billion
BancABC Full Year Financial Results 2012 47
Balance sheet
BWP'000 2012 % chg 2011
Cash and cash equivalents 1,859,269 50% 1,243,431
Financial assets 1,312,032 35%
972,511
Loans and advances 9,144,042 50% 6,077,399
Property and equipment 797,983 23% 647,263
Other assets 294,439 21% 243,284
Total assets 13,407,765 46%
9,183,888
Deposits 10,675,111 45% 7,374,700
Borrowed funds 1,212,731 24%
981,788
Other liabilities 363,839 69% 214,833
Total liabilities 12,251,681 43% 8,571,321
Equity -ordinary shareholders 1,137,044 91%
596,811
Minority interest 19,040 21% 15,756
Total equity 1,156,084 89%
612,567
Total liabilities & equity 13,407,765 46%
9,183,888
86%
14%
Total Assets-2011 (%)
Wholesale Retail
72%
28%
Wholesale Retail
Total assets -2012 (%)
BancABC Full Year Financial Results 2012 48
Balance sheet
USD'000 2012 % change 2011
Cash and cash equivalents 239,288 44% 166,122
Financial assets 168,859 30% 129,927
Loans and advances 1,176,838 45% 811,940
Property and equipment 102,700 19% 86,475
Other assets 37,894 17% 32,504
Total assets 1,725,579 41% 1,226,968
Deposits 1,373,887 39% 985,260
Borrowed funds 156,079 19% 131,167
Other liabilities 46,825 63% 28,702
Total liabilities 1,576,791 38% 1,145,129
Equity -ordinary shareholders 146,338 84% 79,734
Minority interest 2,450 16% 2,105
Total equity 148,788 82% 81,839
Total liabilities & equity 1,725,579 41% 1,226,968
86%
14%
Total Assets-2011 (%)
Wholesale Retail
72%
28%
Wholesale Retail
Total assets -2012 (%)
BancABC Full Year Financial Results 2012 49
Balance sheet – loans & deposits
2008 2009 2010 2011 2012 -
2,000
4,000
6,000
8,000
10,000
12,000
LoansDeposits
50% YoY increase in
loans
45% YoY increase in deposits
42% CAGR 39% CAGR
BancABC Full Year Financial Results 2012 50
Deposits per entity
BWP'000 2012 % change 2011
BancABC Botswana 4,262,406 66% 2,563,126
BancABC Mozambique 1,355,372 11% 1,216,349
BancABC Tanzania 1,147,955 8% 1,060,686
BancABC Zambia 834,141 52% 548,120
BancABC Zimbabwe 3,075,237 55% 1,986,419
Total deposits 10,675,111 45%
7,374,700
Strong growth in deposits especially in
Botswana and Zimbabwe
BancABC Full Year Financial Results 2012 51
Balance sheet – segmental analysis
● Rapid growth in retail loans in Botswana, Zambia and Zimbabwe
● Retail loans are now 40% of total book (2011:20%)
Loans & Advances Wholesale Retail
BWP'000 2012 2011 2012 2011
BancABC Botswana
1,350,606 1,289,565 2,060,231
368,535
BancABC Mozambique
739,157 690,670 137,651
71,227
BancABC Tanzania
667,658 525,984 79,159
46,713
BancABC Zambia
447,851 215,282 585,864
361,628
BancABC Zimbabwe
2,155,878 1,654,772 824,740
378,387
Banking Operations
5,361,150
4,376,273 3,687,645
1,226,490
Head Office entities
95,247 474,636 - -
Total Deposits
5,456,397
4,850,909 3,687,645
1,226,490
BancABC Full Year Financial Results 2012 52
Balance sheet – asset quality
BWP' million 2012 2011 2010 2009 2008
Gross loans 9,460 6,295 3,217 2,130 2,369
Non-performing loans 668 418 268 204 144
Impairments 316 218 138 134 119
Portfolio impairment 78 45 17 13 43
Specific impairments 238 173 121 122 76
NPL as % of gross loans 7.1% 6.6% 8.3% 9.6% 6.1%
Impairment charge 138 80 16 51 44
Impairment charge % loans 1.8% 1.7% 0.6% 2.4% 1.9%
Implied loss given default 36% 41% 45% 60% 53%
BancABC Full Year Financial Results 2012 53
Balance sheet – segmental analysis
● Deposit growth mostly in Botswana and Zimbabwe● Growth driven by wholesale deposits● Retail contribution still low at 9% (2011: 8%)
Deposits Wholesale Retail
BWP'000 Dec 2012 Dec 2011 Dec 2012 Dec 2011
BancABC Botswana
3,923,493 2,418,092 338,914 145,034
BancABC Mozambique
1,020,775 991,922 334,596 224,427
BancABC Tanzania
1,076,873 1,037,774 71,082 22,912
BancABC Zambia
782,493 522,046 51,648 26,074
BancABC Zimbabwe
2,885,102 1,794,548 190,135 191,871
Total Deposits
9,688,736 6,764,382 986,374 610,318
BancABC Full Year Financial Results 2012 54
Balance sheet – capital adequacy
● All entities with exception of Tanzania adequately capitalised● Tanzania to be re-capitalised in 2013● Minimum capital requirements in Zambia and Zimbabwe up to
$100m over time● Phased capitalisation of subsidiaries to cater for growth
Total Capital (BWP m)
Capital Adequacy Ratio
Subsidiary 2012 2011 Min 2012 2011
BancABC Botswana 521 234 15% 17% 16%
BancABC Mozambique 252 225 8% 17% 15%
BancABC Tanzania 115 99 12% 9% 12%
BancABC Zambia 230 126 10% 14% 16%
BancABC Zimbabwe 559 284 12% 13% 11%
BancABC Full Year Financial Results 2012 55
Douglas Munatsi
Strategy and outlook
BancABC Full Year Financial Results 2012 56
Short to medium term objectivesDiversify funding
mix of the business – liquidity risk
management is a focus area for the
Group
Raise additional funding at the
centre – currently looking at a US
$100 million bond
Control impairments downwards – manage loan
portfolio growth
Manage operational risk as business
expands and product range
increases
Consolidate our position as a first
tier bank in Botswana and
Zimbabwe
Turnaround Tanzania
Increase retail penetration in
Mozambique and continue to grow our business in
Zambia
BancABC Full Year Financial Results 2012 57
Dividend declaration
As per Group Policy, a dividend of 8 thebe (0.96 US cent) per share to be paid on 3 May 2013 to shareholders on register on 12 April 2013
Total dividend for the year will be 16 thebe (2011: 17.5 thebe) which is approximately 2.1 US cents (2011: 2.4 US cent)