StanChart bank profit dips
Standard Chartered Bank Botswana has reported a 38 percent decline in profit after tax for the first half of 2025, due to challenging macroeconomic environment, heavily influenced by the downturn in Botswana’s diamond sector, which is the cornerstone of the nation’s economy and export earnings. In its interim financial results released recently, the bank attributed the sharp earnings contraction to subdued business momentum, reduced transaction volumes, and a one-off impairment charge linked to an accounting adjustment that reversed duplicated interest previously held in suspense. The bank stressed, however, that this adjustment does not reflect any deterioration in its underlying credit quality.
Standard Chartered Bank Botswana Chief Executive Officer, Mpho Masupe said the first half of 2025 has been marked by significant headwinds, primarily stemming from the slowdown in the diamond industry, which continues to weigh on national economic activity. “While our profitability has been impacted, our capital and liquidity metrics remain robust, and we are steadfast in executing our refreshed strategic priorities.” He highlighted that despite the challenging backdrop, the bank’s wealth and retail banking (WRB) segment delivered a resilient performance. “The division maintained its asset base, grew customer deposits, and generated P341 million in income, resulting in a pre-tax profit of P101.9 million. This outcome was underpinned by prudent financial management and disciplined cost control.” Contrary, the Corporate and Investment Banking (CIB) segment faced greater pressure as Botswana’s broader economic slowdown characterized by reduced activity in key sectors and tighter market liquidity dampened client demand for financing and investment services. However, the bank emphasized its commitment to supporting corporate and institutional clients with tailored cross-border solutions, leveraging its international network to drive future growth. Looking ahead, Standard Chartered Botswana Masupe expressed cautious optimism for improved business momentum in the second half of the year.
“The bank plans to intensify its strategic focus on returns and profitability, while continuing to support government-led initiatives aimed at economic recovery, diversification, and infrastructure development.” Notably, the bank confirmed that its ongoing review of the Wealth and Retail Banking business including a potential sale is progressing well, though no definitive timeline or transaction details were disclosed. “Our priorities remain clear. We will sharpen our focus on serving our Corporate and Investment Banking clients through our differentiated capabilities, while remaining deeply committed to our retail and affluent clients through tailored solutions that help them navigate dynamic market conditions.”
The bank management explained that as Botswana grapples with the ripple effects of global diamond market volatility and domestic economic restructuring, Standard Chartered’s performance underscores both the vulnerabilities and resilience of the country’s financial sector. “The bank affirmed its long-term commitment to Botswana, even as it adapts its business model to a rapidly evolving economic landscape.” He said the bank has posted a subdued performance but maintained a strong balance sheet during the half year ended June 2025 financial performance. During the period, the bank’s income went down 12 percent year on year due to reduced margins caused by higher cost of funding and reduced transactional volumes.
“The economic environment we are operating in is not unique to us; it reflects broader national challenges. Yet our commitment to delivering value for clients and stakeholders has never wavered,” Masupe noted Looking ahead, Standard Chartered will sharpen its focus on profitability, leveraging its global network to support corporate clients, advance government-led economic diversification efforts, and bolster infrastructure development. “We remain deeply engaged with our clients, offering tailored solutions as they navigate dynamic market conditions. Our strategy is clear and our foundation, solid.”