FNB Botswana
Integrated Report 2023
Introduction to FNB Botswana
OUR
PURPOSE
is to be a trusted partner committed to
NAVIGATING OUR REPORT
This report has been designed for an enhanced digital experience and navigation to ease readability on computer screens and mobile devices for your convenience.
Welcome to our 2023 integrated report
This integrated report (IR or report) reviews achievements for the financial year 1 July 2022 to 30 June 2023. It outlines our performance, emphasising key factors for First National Bank of Botswana Limited's (FNB Botswana or the Bank) commercial success and attractiveness as a secure investment, a reliable place for deposits, a reliable provider of integrated financial services and a model corporate citizen.
Our integrated report, financial results, accounting policies and press releases are available online at www.fnbbotswana.co.bw. Please share your feedback and opinions on our report by emailing investor@fnbbotswana.co.bw.
building a shared future of prosperity
2020 -2025
FNB Botswana's 2025 strategy was launched in 2020 to deliver sustainable growth over five years. Our strategy responds to a dynamic operating environment and ensures that we continue to focus on those matters that enable us to create value. The successful implementation of our strategy will bring our purpose to life: to be a trusted partner committed to building a shared future of prosperity.
Our strategic objectives are underpinned by digital transformation
OUR REPORTING SUITE FOR FY2023
Our reporting suite provides us with an opportunity to share our achievements for the year ended 30 June 2023. This suite is supplemented by various online publications, stakeholder communications and engagements, and additional information available on our website
www.fnbbotswana.co.bw
Navigating icons
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Read more in this report | King IV | Website information | |||||||||||
refers to the King Code on | |||||||||||||
Corporate Governance |
In this report | Back | Previous page | Next page |
Our capital inputs
We recognise the interconnectivity between the capital we use, which informs our decision making and strategic choices. We adapt to changes in the availability, quality, and affordability of our inputs, to remain a successful and sustainable business.
Financial | Manufactured | Human |
Intellectual | Social and | Natural |
relationship |
Stakeholders
Clients | Shareholders | Suppliers | Media | Regulators | |
Communities | Government | Organised labour | Employees |
CONTENTS
1 | Inside front cover/ introduction | ii |
Navigating our report | ii | |
2 | 2023 Performance at a glance | 2 |
3 | About this report | 4 |
4 | About FNB Botswana | 6 |
Who we are | 6 | |
What we do | 7 | |
Operating corporate structure | 7 | |
Where we operate | 8 | |
Why we exist | 10 | |
FNB Botswana's value proposition | ||
Who we serve | 11 | |
How we serve our clients | 12 | |
Why invest in FNB Botswana? | 13 | |
5 | What drives our business | 18 |
Material matters | 18 | |
Material matters matrix | 20 | |
6 | Leadership reports | 30 |
Chairperson's review | 30 | |
Chief Executive Officer's review | 34 | |
7 | How we create value | 40 |
Our business model | 40 | |
Our strategy | 42 | |
Strategy development, approval and | ||
monitoring | 43 | |
Strategic objectives and focus areas in | ||
FY2023 | 44 | |
Segment review | 54 | |
Our stakeholders | 58 | |
Risk and opportunity management | 64 |
8 | Financial Performance | 68 | ||||
Chief Financial Officer's review | 68 | |||||
9 | Sustainability | 74 | ||||
Approach to sustainability | 74 | |||||
Enviromental stewardship | 79 | |||||
How we contribute to economic and social | ||||||
development | 85 | |||||
10 | Shared value | 86 | ||||
11 | Governance and remuneration | 106 | ||||
Governance | 106 | |||||
Board committees | 123 | |||||
Remuneration | 132 | |||||
12 | Annual Financial Statements | 140 | ||||
13 | Glossary | 246 | ||||
Shareholder information | 248 | |||||
14 | ||||||
Notice of Annual General Meeting | 250 | |||||
Form of proxy | 253 | |||||
We provide a full glossary for the terms and abbreviations | ||||||
PG | used in this report on page 246. | |||||
Feedback
Your feedback is important to us, and we welcome your input to enhance the quality of our reporting.
Please send your comments or suggestions to investor@fnbbotswana.co.bw
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First National Bank of Botswana Limited 2023 Integrated Report
Introduction to FNB Botswana
2023 performance at a glance
FNB Botswana remains committed to delivering value to our stakeholders through innovation, service excellence and adherence to the highest standards of corporate governance and capital management.
Strategic and shared value created
Value protection
Strong risk focus
Shared value
P3.8 billion
Financial value created
P17.3 billion
Gross loans and advances
(FY2022: P16.1 billion)
P24.2 billion
Client deposits
(FY2022: P22.2 billion)
P1.4 billion
Profit before tax
(FY2022: P1.2 billion)
32t
Ordinary dividend per share
(FY2022: 26t)
32%
Return on equity
(FY2022: 26%)
49%
Cost-to-income ratio
(FY2022: 51%)
Strategic and shared value created
Operational efficiencies
P14 million
Cost reduction through efficiencies
(FY2022: P14 million)
PGRead more about efficiencies realised on pages 46 to 47.
99%
Process mapping, documentation and governance
(FY2022: 98%)
56%
Business process optimisation
(FY2022: 55%)
2.7%
Process automation, digitalisation and robotics
(FY2022: 1.5%)
towards effective risk management
Further reading on pages 50 and 51. | |||||
PG | |||||
Solutionist people | |||||
80% | |||||
Culture Risk Assessment dipstick survey | |||||
(FY2022: 73%) | |||||
3.6% | |||||
Average organisational performance | |||||
rating | |||||
(FY2022: 3.8%) |
P726 million
paid in employee benefits
(FY2022: P628 million)
PGFurther reading on pages 44 and 45.
transactional value through CashPlus
(FY2022: P2.0 billion)
P375 million
procurement through local companies
(FY2022: P336 million)
P304 million
taxes paid to Government
(FY2022: P272 million)
P9.3 million
total corporate social investment (CSI)
(FY2022: P6.8 million)
P7.5 million
invested in employee training and skills development
(FY2022: P4.7 million)
PGFurther reading on pages 52 and 53.
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FNB Botswana Limited 2023 Integrated Report
About this report
About this report
We embrace integrated thinking to enhance decision making and deliver on our purpose to be a trusted partner committed to building a shared future of prosperity for all our stakeholders.
Scope and boundary
The report's content is derived from the regulatory universe listed below, the information needs of our financial capital providers, and matters considered significant for value creation. For further details on our materiality process, please refer to page 18.
Integrated | Annual | |
financial | ||
Key reporting frameworks applied | report | statements |
King Report on Corporate Governance for South Africa, 2016 (King IV)1
International Financial Reporting Standards (IFRS)
Botswana Companies Act of 2007, as amended (Cap 42:01) (Companies Act) through the
Registrar of Companies
Non-Bank Financial Institutions Regulatory Authority Act of 2016 (Cap 46:08) through the
Non-Bank Financial Institutions Regulatory Authority
Banking Act of 1995 (Cap 46:04) (Banking Act) through the Bank of Botswana
Corporate Governance Principles for Banks through the Basel Committee on Banking
Supervision
Financial Reporting Act of 2020 through the Botswana Accountancy Oversight Authority
Botswana Stock Exchange Equity Listings Requirements, version 3.4, NBFIRA-approved with effect from 1 January 2019 (Botswana Stock Exchange Listing Requirements)
Board Governance Framework
Guidelines on Corporate Governance for Banks/ Financial Institutions Licensed and
Supervised by the Bank of Botswana on 22 November 2022
1 Copyright and trademarks are owned by the Institute of Directors in South Africa NPC and all of its rights are reserved.
The consolidated and separate annual financial statements (AFS) have been audited by the independent auditors, Deloitte and Touche PG(Botswana). See their report on page 140.
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Materiality
Our material matters, detailed on pages 18 to 29 shape our strategy and guide the content of this report. | |||||||
PG | |||||||
The Board believes that the matters presented in this report provide a well-balanced mix of information, enabling readers to evaluate FNB Botswana's performance and prospects. This report concentrates on material issues, opportunities and challenges that significantly affect FNB Botswana's sustainability and our ability to provide consistent value to stakeholders.
Both the Board and management affirm that all reliable information has been disclosed to the best of their knowledge, and there are no legal barriers to disclosing material information.
Reporting time frames
We use the following general classifications when making timeframe references in this report:
Short term: Less than one year
Medium term: One to three years
Long term: Three to 10 years
Forward-looking statements
This report contains certain forward-looking statements about the Bank's anticipated performance, results, operations, and prospects. Although these statements represent our future expectations and judgements, the opinions are subject to known and unknown risks and uncertainties that could adversely impact our business and financial performance. Undue reliance should not be placed on such opinions, forecasts, or data. Forward-looking statements apply to the date on which they are made. The Bank does not undertake any obligation to publicly update or revise any of its opinions or forward-looking statements, whether to reflect new data, future events, or circumstances. The financial information on which the forward-looking statements are based has not been audited or reported on by FNB Botswana's independent external auditors.
Approval of the integrated report
Several internal stakeholders actively engaged in the development, review and approval process of this integrated report. The Audit Committee submitted both the annual financial statements and integrated report to the Board for approval.
After careful assessment, the Board verified that this integrated report offers a fair and balanced representation of the Bank's performance and prospects. The Board officially approved the report on 12 October 2023.
Balisi Mohumi Bonyongo | John Kienzley Macaskill | Michael William Ward |
Chairperson | Non-Executive Director | Independent Non-Executive Director |
Doreen Ncube | Ephraim Dichopase Letebele | Jabulani Richard Khethe |
Independent Non-Executive Director | Independent Non-Executive Director | Independent Non-Executive Director |
Naseem Banu Lahri | Massimo Marinelli | Asad Petkar |
Independent Non-Executive Director | Independent Non-Executive Director | Independent Non-Executive Director |
Louis Frans Jordaan | Steven Lefentse Bogatsu | Mbako Mbo |
Non-Executive Director | Executive Director (Chief Executive Officer) | Executive Director (Chief Financial Officer) |
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First National Bank of Botswana Limited 2023 Integrated Report
About FNB Botswana
Who we are
FNB Botswana is one of nine licensed commercial banks in Botswana. The Bank provides individuals and businesses with a full range of integrated financial solutions. We operate in the retail, commercial and corporate segments. FNB Botswana is the largest company on the Botswana Stock Exchange (BSE) by market capitalisation and the largest bank in Botswana by balance sheet, profitability and client base.
Our Purpose | Our purpose is to be a trusted partner committed to building a shared future of prosperity. |
Our Vision | We strive to be the world-class financial solutionist of choice, consistently delivering an unmatched |
client experience. |
Mission
Our empowered people provide vibrant spaces and use cutting-edge platforms to create sustainable shared value for all.
Creating shared value for our key stakeholders:
Clients | Employees | Shareholders | Regulators | Suppliers |
Media | Communities | Organised labour | Government |
Keeping our promises to our stakeholders
Deliver the best | Care for the | Build an | Create a culture | Speak your mind | Avoid intellectual | Fight for ethical |
results for our | business as if it | environment | of sharing | and encourage | laziness and | conduct and |
customers, | were your own | where everyone's | others to do the | question the | transparency | |
society and each | views are valued | same | status quo | |||
other |
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What we do
We offer a diverse range of banking and related services accessible through our branches, automated teller machines (ATMs), automated deposit teller machines (ADTs), point-of-sale (POS) devices, CashPlus agency banking and digital banking, including Cellphone Banking, Online Banking and the FNB App, providing extensive and comprehensive banking options. The Bank has a toll-free24-hour Contact Centre and offers personalised banking services.
Our innovative CashPlus agency model expands our reach to underserved areas, enabling FNB Botswana clients to conveniently deposit, withdraw cash, purchase airtime and electricity at any FNB CashPlus agent within their community, thus reducing the necessity to visit a branch or ATM.
Operating corporate structure
FirstRand Limited
(SA)
FirstRand | FirstRand | FirstRand | FirstRand | FirstRand | |||||||||
International | Investment Holdings | Insurance Holdings | |||||||||||
Bank Limited (SA) | EMA Holdings Limited | ||||||||||||
Limited(Gurnesey) | (Pty)Ltd (SA) | (Pty) Ltd (SA) 100% | |||||||||||
100% | (SA) 100% | ||||||||||||
100% | 100% | ||||||||||||
First National Bank
Holdings (Botswana)
Limited 100%
First National | First National Bank | FNB | |||||
Insurance Brokers | of Botswana Limited | Nominees (Pty) | |||||
100% | 70% | Limited 100% | |||||
First Funding (Pty) | Financial Services | First National | ||
Company (Pty) | Insurance Agency | |||
Limited 100% | ||||
Limited 100% | (Pty) Limited 100% | |||
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First National Bank of Botswana Limited 2023 Integrated Report
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Disclaimer
First National Bank of Botswana Limited published this content on 12 October 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 October 2023 07:16:31 UTC.