The Capricorn Group has reported an impressive after-tax profit of N$1,7 billion for the past financial year.
This translates to N$4,6 million per day, which the group of 20-plus subsidiaries earned after paying 1 998 permanent employees, government taxes and all its other expenses for the financial year ending June 2024.
This is according to the group’s latest financial statements released yesterday.
The group has operations in Namibia and Botswana, stretching over banking, micro-lending, property development, unit trust management, insurance, asset management and within the communications and technology sector
N$1,36 billion, (80%) of that profit came from Bank Windhoek, while Bank Gaborone contributed N$136 million, with Peo Finance contributing N$17 million.
Peo Finance is the group’s microlending business in Botswana.
The group’s shareholding in Entrepo Finance increased to 55.5% from 46%, making it the majority shareholder.
Entrepo is a micro-lender for permanent employees in the government.
Currently, the group is holding N$51,9 billion in deposits, having given out N$48,8 billion in loans and advances.
According to the report, transactions to the value of N$5,6 billion were done on the group’s banking app.
Dividends paid to shareholders were N$560 million, which translated to a payout ratio of 33.4%.
However, this is a decline compared to the 35.2% recorded last year.
According to the group’s statement, net interest income before impairment charges increased by 13.6% to N$3,1 billion (2023: N$2,7 billion).
This was achievable with the Bank of Namibia keeping the repo rate high at 7.50%.
The higher the repo rate, the higher the prime lending rate, which is what banks charge clients on loans.
“Interest income growth was driven by higher interest rates and a 7.5% year-on-year growth in the loan book,” noted the statement.
Bank Windhoek also experienced an increase in net interest income, growing by 9.9%.
Its other subsidiary, Bank Gaborone, recorded a net interest income increase by 40.8% due to continued loan book growth and an improved net interest margin, noted the statement.
Johan Maass, the group’s chief financial officer, said: “The results are attributed to excellent results and solid all-round performances across the group’s portfolio of businesses, which includes the banking subsidiaries, Bank Windhoek and Bank Gaborone, as well as Capricorn Asset Management (CAM), Entrepo Group, Peo Finance and our associates.”
The group decided to increase impairment charges to N$328,5 million from N$235,6 million, even though non-performing loans (NPLs) decreased.
According to the statement, this is a result of the difficult macroeconomic environment and a prolonged period of higher interest rates, which negatively impacted credit risk indicators.
“The group’s NPLs decreased on the back of some large recoveries during the financial year,” noted the statement.
Additionally, the group says its loss rate increased from 0.51% to 0.67%.
The loan loss rate is a measure of the percentage of loans that are expected to become bad debts or losses.
However, “gross loans and advances increased by 7.4% to N$50,7 billion this year, mainly attributable to growth in term loans and article finance,” noted the statement.
Term loans are typically longer-term loans that are used to finance specific projects or investments, while article finance refers to loans that are secured by specific assets, such as inventory or equipment.
About Capricorn
Capricorn’s main investments include 100% shareholdings in Bank Windhoek Ltd, 84.8% shares in Capricorn Investment Holdings (Botswana) Ltd, which has a 100% stake in Bank Gaborone.
It also owns Namib Bou (Pty) Ltd, Capricorn Asset Management (Pty) Ltd, Capricorn Unit Trust Management Company Ltd, Capricorn Capital (Pty) Ltd, Capricorn Mobile (Pty) Ltd and Capricorn Investment Group (Pty) Ltd.
The shareholding also extends to 55.5% in Entrepo, a 29.5% shareholding in Sanlam Namibia Holdings (Pty) Ltd, a 28% shareholding in Santam Namibia Ltd and a 36.4% shareholding in Paratus Group Holdings Ltd.
– Email.shania@namibian.com.na; Twitter(X): @ShaniaLazarus
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