Try our mobile app
Standard Bank Namibia Limited
Registration No. 2006/306
Registered in Namibia
Short Name: SBN Holdings Limited (the “Company”)
(“SBN Holdings Limited” or “the Company”))
Issuer code: SBN02 ISIN no.: ZAG000178419
Issuer code: SBN03 ISIN no.: ZAG000178427
12 April 2023
CONSOLIDATED FINANCIAL RESULTS FOR THE YEAR ENDED 31 December 2022
• BASIC EARNINGS PER SHARE OF 119 CENTS (2021: 70 CENTS)
• HEADLINE EARNINGS PER SHARE OF 119 CENTS (2021: 70 CENTS)
• ORDINARY DIVIDEND PER SHARE OF 46 CENTS (2021: 15 CENTS)
• TOTAL DIVIDEND PER SHARE OF 66 CENTS (2021: 31 CENTS)
Results
Key highlights from SBN Holdings Limited results for the period under review include:
• Profit for the year increased by 70.5%, up from N$366 million to N$624 million, driven by the
increase in repo rate and improvement of our collection strategy to reduce our credit impairment
charges which are down 44.2%.
• Net interest income increased by 17.5% to N$1 445 million, predominantly due to the steady 300
basis point (bps) increase in the repo rate from 3.75% to 6.75% since 1 January 2022 and ongoing
improvement in net interest margin, up from 3.9% to 4.4%.
• Non-interest revenue increased by 6.1% to N$1 283 million, driven by 31.8% growth in trading
revenue due to increased client flows and volatility in currency markets. In addition, other revenue
was up 37.1% from N$106 million to N$146 million supported by growth in bancassurance
revenue, as well as additional property-related revenue from the newly acquired property portfolio.
• Credit impairments decreased by 44.2% year on year, primarily due to the ongoing
implementation of our 2021 non-performing loan reduction strategy and the achievement of
related strategic initiatives. As a result, our credit loss ratio reduced by 49bps from 1.09% to
0.60%.
• Our measures to contain costs, continue. Operating expenses increased by 5.8% to N$1.7 billion,
below the average annual inflation of 6.1%.
• Loans and advances to customers and banks increased by 2.3% to N$26 billion. The Corporate
and Investment Banking (CIB) portfolio grew by 35.5%, driven by strong growth in corporate
lending due to increased client activity. The Consumer and High Net Worth (CHNW) and Business
and Commercial Banking (BCB) portfolios declined by 7.8% to N$17.7 billion, partly driven by the
8.4% decrease in other loans and advances due to a debt settlement transaction that led to the
acquisition of a property portfolio. The significant increase in property in possession was the result
of the acquisition of the property portfolio.
• Deposits from customers and banks declined moderately by 3.2% to N$27 billion, predominantly
driven by a decline in negotiable certificates of deposits, savings deposits and demand deposits.
Debt securities increased by 28.9% due to our inaugural Green Bond issuance that raised N$400
million across two notes. The group’s liquidity position remained strong and within approved risk
appetite and tolerance limits.
• The ROE improved from 8.6% to 13.7%. The group is well-positioned to achieve its ROE target of
a minimum of 15% by 2025.
Business update
Operating environment
In 2022, the global economy experienced another fundamental shift. As the year progressed, complex
challenges arose in the global operating context. In response to the Ukraine invasion the West instituted
sanctions against Russia, driving up commodity prices. The geopolitical tension between China and the
United States continues to disrupt global supply chains. Other factors such as rising inflation and interest
rates, China’s zero Covid policy and slower growth all compounded to significantly impact the growth
outlook. Despite this, Namibia’s economic recovery continued in 2022 with gross domestic product (GDP)
growth forecast at 4.2%.
Delivering our strategic objectives
Our focus for 2022 remained on transforming client experience by developing bank specific capabilities
that enhance our processes and drive efficiency while also improving service delivery to customers. We
developed and then successfully delivered relevant and bespoke digital products and solutions to meet
the needs of customers and employees, supported by leveraging the group’s key strategic partnerships.
It is therefore a privilege to present our financial results showing a growth in profit for the year of 70.5%,
and an increase in ROE from 8.6% to 13.7%, albeit still below our aspired target of 15%. As a board, we
are pleased by these improved results due to the focus and dedicated efforts made by the group’s people.
We remain confident that the group is well-positioned to take advantage of the current and future
opportunities the country holds. Increased investment in green energy and renewables, as well as the
discovery of oil will continue to drive economic growth and thereby create value for society.
We continue to invest in our people and support their well-being to ensure that they can embrace the
rapid changes in our environment. We are equipping them with the skills to make extensive use of the
new technology, digital capabilities and data that we need, to deliver our purpose.
Sustainability over the long term is central to our strategy and our ability to deliver inclusive and
sustainable growth. We continue to make a meaningful difference in our communities, ensuring that our
social, economic and environment as well as our corporate social investment efforts contribute to the
improvement and upliftment of the socioeconomic circumstances of the communities in which we operate.
Dividend
The Board recommended an ordinary final dividend of 46 cents per share (2021: 15 cents per ordinary
share).
The salient dates are as follows:
Last day to trade cum dividend: 5 May 2023
First day to trade ex–dividend: 8 May 2023
Record date: 12 May 2023
Payment date: 26 May 2023
Looking ahead
A gloomier outlook is now expected during the coming year, with the world’s economic growth expected
to slow to 1.7% in 2023, down from 2.9% in 2022 according to the World Bank’s latest reports. Challenges
are expected to remain as geopolitical tension, climate events, global supply chain disruptions and higher
food and oil prices will continue to drive volatility and growing socioeconomic challenges, due to the
increased cost-of-living and higher household debt.
Namibia’s economic growth over the medium term is expected to be higher than the pre-pandemic growth
levels, however, given the current global environment, this will be slightly slower than initially anticipated.
The International Monetary Fund forecasts Namibia’s GDP to grow 3.0% for 2022 and 3.2% for 2023.
We remain optimistic about the reforms ahead that are likely to come to fruition towards the end of the
mid-term expenditure framework. Large structural investments in both the green and blue economy, as
well as the discovery of offshore oil, place Namibia in an excellent position to become an energy
powerhouse on the African continent over the medium- to longer-term and alleviate its and the region’s
energy needs. This has the potential to accelerate economic growth moving forward, and we are well-
positioned to navigate this future with our strategic partners. We are also looking forward to assisting our
clients in these industries to achieve their aspirations.
Our strategy for 2023 will continue to focus on our clients, our people as well as operational excellence,
thereby ensuring that our people, processes and systems are properly aligned to continue to deliver
appealing and relevant customer value propositions across all segments, and we are also looking forward
to assist our clients to achieve their aspirations.
H MAIER M GEISES
CHAIRMAN CHIEF EXECUTIVE
BOARD OF DIRECTORS:
HERBERT MAIER (CHAIRMAN)
SUNE BRUGMAN
ISAC TJOMBONDE
SILKE HORNUNG
PETER SCHLEBUSCH
NATASHA BASSINGTHWAIGHTE
BIRGIT ROSSOUW
MARIA SHIVUTE DAX
NANGOSORA ASHLEY TJIPITUA
MERCIA GEISES
LETITEA DU PLESSIS
COMPANY SECRETARY
S TJIJOROKISA
AUDITOR’S OPINION
The consolidated financial statements are an extract from the audited financial statement for the year
ended 31 December 2022. The auditor’s unqualified audit opinion on the financial statements is available
for inspection at the Company’s registered office.
The information in this announcement has been extracted from the audited financial statements, but the
announcement itself is not audited.
REGISTERED OFFICE
1 Chasie Street, Kleine Kuppe, Windhoek; P.O. Box 3327, Windhoek, Namibia
AUDITORS
PricewaterhouseCoopers
344 Independence Avenue, Windhoek
SPONSOR
Debt Sponsor
The Standard Bank of South Africa
TRANSFER SECRETARIES
Transfer Secretaries (Pty) Ltd
4 Robert Mugabe Avenue
P.O. Box 2401
Windhoek, Namibia
SBN HOLDINGS LIMITED
CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 December 2022
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 December 2022
Change Audited Audited
31 December 31 December
2022 2021
Restated
% N$' 000 N$' 000
Net interest income 17.5 1 444 802 1 229 312*
Non-interest revenue 6.1 1 283 086 1 208 806
Total income 11.9 2 727 888 2 438 118
Credit impairments (44.2) (161 213) (288 751)
Income after credit impairments 19.4 2 566 675 2 149 367
Operating expenses 5.8 (1 678 675) (1 586 804)
Net income before tax 57.8 888 000 562 563
Taxation (indirect and direct) 34.3 (263 720) (196 352)*
Profit for the year 70.5 624 280 366 211
Profit attributable to ordinary shareholders 70.7 623 603 365 388
Other comprehensive income net of taxation
that will not be reclassified to profit or loss
Net change in fair value of equity financial assets
measured at fair value through other
comprehensive income (FVOCI) (78.9) (1 879) (8 906)
Fair value movement on post-employment benefit (40.0) 5 216 8 693
Total comprehensive income for the year 71.5 627 617 365 998
Attributable to ordinary shareholders 71.7 626 940 365 175
Attributable to non-controlling interest (17.7) 677 823
EARNINGS PER SHARE
Profit for the year attributable to ordinary
shareholders 70.5 624 280 366 211
Weighted average number of shares issued - 522 472 522 472
Basic earnings per share 70.0 119 70
* Refer to the restatement narrative included in note 4 for the restatements of accrued interest and
interest in suspense.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
as at 31 December 2022
Change Audited Audited
31 December 2022 31 December 2021
Restated
% N$' 000 N$' 000
Assets
Cash and balances with central banks 12.4 1 673 337 1 488 497
Trading assets and financial investments (14.2) 5 397 635 6 290 130
Loans and advances to banks 14.0 3 714 600 3 257 649
Loans and advances to customers 0.6 22 254 850 22 124 673*
Properties in possession >200 491 154 24,892
Other assets 0.5 2 143 121 2 133 208*
Total assets 1.0 35 674 697 35 319 049
Liabilities
Deposits from banks (3.0) 1 430 532 1 474 539
Deposits from customers (3.2) 25 922 875 26 781 347*
Debt securities 28.9 2 528 252 1 961 123
Other liabilities 32.2 1 010 046 763 764
Total liabilities (0.3) 30 891 705 30 980 773
Equity 10.3 4 782 992 4 338 276*
Total equity and liabilities 1.0 35 674 697 35 319 049
* Refer to the restatement narrative included in note 4 for the restatements of loans and advances, other
assets and deposits.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 31 December 2022
Ordinary Share-based Fair value Post- Statutory Retained Ordinary Non- Total equity
share payment adjustments employment credit risk earnings shareholders controlling N$'000
capital and reserve on FVOCI benefit reserve N$'000 equity interest
premium N$'000 financial reserve N$’000 N$'000 N$'000
N$'000 assets N$'000
N$'000
Balance at 1 January 2021 as previously
reported 643,234 — 7,685 35,209 58,510 3,421,876 4,166,514 14,030 4,180,544
Restatement — — — — — (51,524) (51,524) — (51,524)
Balance at 1 January 2021 643,234 — 7,685 35,209 58,510 3,370,352 4,114,990 14,030 4,129,020
Total comprehensive income for the year — — (8,906) 8,693 365,388 365,175 823 365,998
Profit for the year 365,388 365,388 823 366,211
Other comprehensive income after tax for the
year (8,906) 8,693 (213) (213)
Transactions with the shareholders,
recorded directly in equity — — — — 74,873 (231,615) (156,742) (156,742)
Transfer between reserves 74,873 (74,873) — —
Dividends paid (156,742) (156,742) (156,742)
Balance at 1 January 2022 643,234 — (1,221) 43,902 133,383 3,504,125 4,323,423 14,583 4,338,276
Total comprehensive income for the year — — (1,879) 5,216 623,603 626,940 677 627,617
Profit for the year 623,603 623,603 677 624,280
Other comprehensive income after tax for the
year (1,879) 5,216 3,337 3,337
Transactions with the shareholders,
recorded directly in equity — — — — (24,083) (158,818) (182,901) (182,901)
Transfer between reserves (24,083) 24,083 — —
Dividends paid (182,901) (182,901) (182,901)
Balance at 31 December 2022 643,234 — (3,100) 49,118 109,300 3,968,910 4,767,462 15,530 4,782,992
CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended 31 December 2022
Audited Audited
31 December 2022 31 December 2021
Restated
N$’000 N$' 000
Net cash flows from operating activities (87,195) (1,476,768)*
Cash flow from operations 1,356,237 1,049,013*
Net movement in working capital (1,271,187) 593,723*
Dividends received — 631*
Direct taxation paid (172,245) (166,599)*
Net cash flows used in investing activities (69,814) (157,194)
Capital expenditure on property and
(50,196) (62,318)
equipment
Proceeds from sales of property and
5,045 1,661
equipment
Capital expenditure on intangible assets (24,663) (96,537)
Net cash flows from financing activities 349,286 163,902
Net senior debt issued 400,000 1,543,000
Senior debt redeemed - (1,206,500)
Principal element of lease payments (17,813) (15,956)
Subordinated debt issued 250,000
Subordinated debt redeemed (100,000)
Dividends paid (182,901) (156,642)
Net increase in cash and cash equivalents 192,277 1,483,476*
Cash and cash equivalents at the beginning of the
4,739,268 3,270,130*
year
Effects of exchange rate changes on cash and
(148,012) (14,338)*
balances with central banks
Cash and cash equivalents at the end of the year 4,783,533 4,739,268*
* Refer to the restatement narrative included in note 4 for the restatements relating to the statement of
cash flows.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. Reporting entity
SBN Holdings Limited is a company incorporated in Namibia (Registration number:
2006/306). The consolidated annual financial statements for the year ended 31 December
2022 comprise the Company, its subsidiaries and other controlled entities, together referred
to as the “Group”.
2. Statement of compliance
The consolidated financial statements have been extracted from the audited financial
statements for the year ended 31 December 2022, which have been prepared in accordance
with International Financial Reporting Standards.
The annual financial statements were approved by the Board of Directors on 22 March 2023.
3. Significant accounting policies
The accounting policies applied in the annual financial statements as at and for the year
ended 31 December 2022, are consistent with the prior year, except for the adoption of new
and amended IFRS’s that became effective for the current financial period. In accordance
with the requirements of the transition methods chosen by the group in applying these
standards, comparative information throughout the annual financial statements has not been
restated.
4. Restatements
During the year, the group noted the following restatement relating to the group’s previously
published results.
1. In the current year the group enhanced the control environment surrounding its client
management system (CMS) by embedding a client contribution report tool for accrued
interest. The report tool improves the process of reconciliation of interest accrued
balances between the CMS and the balance sheet accounts. As part of the
reconciliation process, all transactional data for accrued interest income, accrued
interest expense and interest in suspense for the period 2012 to 2021 was analysed:
Unsubstantiated accrued interest income of N$30.5 million, interest in suspense
to the value of N$8 million, accrued interest expense to the value of N$14.0 million
and credit impairments to the value of N$23 million were adjusted and restated
accordingly for periods ended up to 31 December 2020. For the 2021 financial
year, a net total of N$7.4 million in interest income and expense was restated.
The N$24.2 million normal tax impact of these restatements has also been
reflected in the periods ended up to 31 December 2020. For 2021 the tax impact
of N$2.4 million was also adjusted for.
These errors have been corrected by restating the comparatives in the statement of
financial position, statement of comprehensive income and related notes of the
company.
2021
Previously
CONSOLIDATED STATEMENT OF reported Restatement Restated
FINANCIAL POSITION N$’000 N$’000 N$’000
Assets
Loans and advances 25 447 708 (65 386) 25 382 322
Other assets 346 814 (3 949) 342 865
Normal tax asset 138 521 26 606 165 126
Total assets (42 729)
Equity
Equity attributable to ordinary shareholders 4 379 958 (56 535) 4 323 423
Liabilities
Deposits and current accounts 28 242 080 13 806 28 255 886
Total equity and liabilities (42 729)
2021
Previously
CONSOLIDATED STATEMENT OF reported Restatement Restated
COMPREHENSIVE INCOME N$’000 N$’000 N$’000
Net interest income 1 236 682 (7 370) 1 229 312
Interest income 1 972 847 (7 588) 1 965 259
Interest expense (736 165) 218 (735 947)
Non-interest revenue 1 208 806 1 208 806
Total income 2 445 488 (7 370) 2 438 118
Credit impairment charges (288 751) (288 751)
Net income before operating expenses 2 156 737 (7 370) 2 149 367
Operating expenses (1 586 804) (1 586 804)
Net income before indirect tax 569 933 (7 370) 562 563
Indirect taxation (43 356) (43 356)
Profit before direct taxation 526 577 (7 370) 519 207
Direct taxation (155 355) 2 359 (152 996)
Profit for the year 371 222 (5 011) 366 211
Attributable to ordinary shareholders 370 399 (5 011) 365 388
Attributable to non-controlling interest 823 823
Basic and diluted earnings per ordinary share 71 70
2. The group also performed benchmarking and internal investigations to reassess the
definition of cash and cash equivalents when compiling the statement of cash flows.
The following have been identified as industry best practice during this exercise and
have resulted in the following restatements, changes to accounting presentation
policies and related additional disclosures:
• The direct method provides a more reliable presentation of the cash flow
movements for the group and company which is not available under the indirect
method. This change only impacted net cash flows from operating activities within
the statement of cash flows for the group and company.
• The group restated its financial statements to appropriately reflect and present the
change from on demand loans and advances to banks to cash and cash
equivalents in the statement of cash flow and updated the related accounting
policy accordingly, refer to note 33.8 in the Annual Report. These balances,
amounting to N$3.3 billion in the 2021 closing cash and cash equivalents balance
and N$2.2 billion in the opening balance, were in prior periods excluded from cash
and cash equivalents and instead included in income-earning assets. Both the
balances and movement (N$1.0 billion) have now been appropriately included
within the cash and cash equivalents line in the statement of cash flows.
• Specific accounting policies, have been included for the following:
o Cash and balances with central banks
o Cash and cash equivalents
The impact on the statement of cash flows of the above changes is detailed in the
annual financial statements. The related notes were restated as required.
2021
Previously
reported Restatement Restated
CONSOLIDATED STATEMENT OF CASH
FLOWS N$’000 N$’000 N$’000
Net cash flows from operating activities
Cash flows from operations (indirect method) 446 661 (446 661)
Net income before capital items and equity- 569 933 (569 933)
accounted earnings
Adjusted for non-cash items and other adjustments (751 308) 751 308
included in the income statement
(Increase)/decrease in income-earning assets (2 416 969) 2 416 969
Increase/(decrease) in deposits and other liabilities 2 002 190 (2 002 190)
Interest received 1 968 515 (1 968 515)
Dividends received 631 (631)
Interest paid (759 732) 759 732
Direct tax paid (166 599) 166 599
Net cash flows from operating activities 1 476 768 1 476 768
Cash flows from operations (direct method) 1 049 013 1 049 013
Interest and commission receipts 3 122 635 3 122 635
Interest payments (759 732) (759 732)
Recoveries on loans previously written off 35 954 35 954
Cash payments to suppliers and employees (1 349 844) (1 349 844)
Working capital changes 593 723 593 723
Increase)/decrease in operating assets (1 391 904) (1 391 904)
Increase/(decrease) in operating liabilities 1 985 627 1 985 627
Dividends received 631 631
Taxation paid (166 599) (166 599)
Net cash flows from investing activities (157 194) (157 194)
Net cash flows from financing activities 163 902 163 902
Net increase/(decrease) in cash and balances 453 369 1 030 107 1 483 476
with the central bank
Cash and balances with the central bank at the 1 035 972 2 234 158 3 270 130
beginning of the year
Effects of exchange rate differences on cash and (844) (13 494) (14 338)
balances with the central bank
Cash and balances with the central bank at the 1 488 497 3 250 771 4 739 268
end of the year
5. Earnings per share
Headline earnings reconciliation Change Audited Audited
31 December 2022 31 December 2021
Restated
% N$’000 N$’000
Profit for the year attributable to ordinary
shareholders 70.7 623,603 365,388
Adjusted for:
IAS 16 (Profit) on sale of property & equipment >100 (2,330) (478)
IAS 36 Impairment losses on property and
equipment (12.0) 1,207 1,371
Headline earnings 69.9 622,480 366,281
Net asset value per share (cents) 10.3 912 827
Basic earnings per share (cents) 70.0 119 70
Headline earnings per share (cents) 70.0 119 70
Changes to the board
During the year, Mr Alpheus Mangale and the chief financial officer, Mrs Letitea du Plessis,
resigned from the board and Mr Jerry Muadinohamba retired. We thank them for their
contribution to the group.
There will be more changes in the composition of the board during 2023. Ms Natasha
Bassingthwaighte, Mrs Birgit Rossouw as well as Mr Herbert Maier, will be retiring from the
board after serving on the SBN board for more than 10 years. This is in line with the group’s
board succession plan for directors. Mrs Maria Dax has reached the age of 70 years and,
as prescribed by BID-1 which became effective during December 2022, she will also retire
from the board at the 2023 AGM. We are honoured to be joined by Ms Silke Hornung, Ms
Sune Brugman and Ms Nangosora Ashley Tjipitua
and welcome them as directors on the board.
