Botswana’s top three banks record profit increase

Botswanas top three banks record profit increaseBarclays, First National Bank (FNB) and Standard Chartered have all recorded non-interest profit increases. (Image source: debelzie/Flickr)The biggest three banks in Botswana have recorded an overall rise in their non-interest incomes

The positive financial results from Barclays, First National Bank (FNB) and Standard Chartered came in spite of a cap on banking charges imposed by the Bank of Botswana (BoB) in January 2014.

It was feared that the two-year moratorium on fee increases will push financial institutions into the red by eating into their non-interest income, at a time when interest-related profits were suffering due to the low-interest environment in the country.

However, the banks have managed to mitigate the impact of the BoB cap, with Motswedi Securities’ financial analyst Tlotlo Ramalepa saying this was down to their ability to innovate and willingness to improvise.

“It is very important to note that although the moratorium was put in place, this does not necessarily hinder commercial banks from coming up with more innovative strategies to boost their non- interest revenues,” Ramalepa told Xinhua news agency this week. “Therefore there is still room for the banks to drive profitability under the challenging environment.”

The banking fee cap was put into effect in response to public concerns over a gulf between the size of charges levied by financial institutions and the quality of services provided.

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