ABC Holdings Limited Group,which operates the BancABC brand, has registered a loss of USD25.3 (P308 million) for the year ended 31 December 2019, the company’s audited financials reveal.
ABC Holdings operates a number of BancABC commercial banks across sub-Saharan Africa. The company is listed on the Botswana Stock Exchenge (BSE).
According to the company, the loss excludes the International Financial Reporting Standards 5 (non-current assets held for sale and discontinued operations) re-measurement loss impact of USD40.2 million (P480 million). This is the company that recorded profit of USD13.9 million (P166 million) in the same period last year.
ABC also registered a net interest income of USD82.6 million,28 percent down from USD115.1 million in the comparative year. “This was a result of lower interest margins, partially compensated by growth of loans and advances witnessed in Botswana and Mozambique in the consumer and corporate loan books respectively,” the company stated in their financials.
On a much brighter side, BancABC’s non-interest income skyrocketed by 16 percent from USD81.1 million for the year that ended 31 December 2018 to USD93.8 million for the year under review. The company attributes the increase to largely improved foreign currency trading revenue. According to the company, foreign currency trading revenue significantly grew from USD18.9 million in 2018 to USD45.2 million for the year that ended 31 December 2019. It was the first time that BancABC’s non-funded income exceeded funded income since 2018.
The company’s operating expenses dwindled by 5.4 percent to USD168.5 million for the year under review as compared to USD178.1 million for the year that ended 31 December 2018. This however excludes losses on monetary items of USD11.1 million. BancABC nevertheless, attributed the decrease in operating expenses to the effects of currency translation on Zimbabwean costs. The effect of the strategic cost management initiatives across the Group were also credited for the company’s decrease in operating expenses.
Meanwhile when making their assessment on Botswana, the company noted that the country has had sub-normal economic growth throughout 2019. “During the year economic growth was estimated to have slowed down to about 3.3 percent owing to weaknesses in the diamond market, a severe drought and slower growth in neighbouring countries. Inflation averaged 2.8 percent year-on-year in 2019 compared to 3.2 percent year-on-year in 2018, which provided some relief for consumers and businesses,” the company stated.