A B C H O L D I N G S L I M I T E D 2 0 0 5 A N N U A L R E P O RT Banking in Africa comes of age
Contents Introduction Values and Personality Group Financial Highlights Chairman’s Statement Directorate and Management Group C
Zu lu p t la te r/S us 2 hi & Sa sh im i
International banking flair for Africa. At African Banking Corporation you can enjoy the full value of world-class banking in A
4 Lu ba bo wl wi th fig ur e/P ae lla
Introduction ABC Holdings Limited is listed on the Botswana and Zimbabwe Stock exchanges and is the holding company of the Afri
Group Financial Highlights Financial highlights for the year ended 31 December 2005 on a historical cost basis 31-DEC-05 US$’00
NET ASSET VALUE PER SHARE 2.0 1.9 1.6 1.3 1.6 1.5 THEBE 1.5 1.0 .5 0 2001 2002 2003 YEAR 2004 2005 TOTAL ASSETS 2000 1,800 1,60
Chairman’s Statement Global Environment Growth in the global economy continued to be driven by the U.S. and Chinese economies.
Botswana managed to grow its balance sheet by 32% with deposits from customers being the main driver of the growth. However att
Despite the harsh macroeconomic environment, the financial sector has remained remarkably resilient over the year. Although a n
Directorate & Group Management ABC Holdings Limited - Board of Directors Chairman Non-Executive Directors Mr O.M. Chidawu Mr H.
Directorate CHIDAWU, Oliver M. (Zimbabwean) - Chairman Oliver Chidawu was born in Zimbabwe in 1954. He is a first generation en
KUDENGA, Ngoni (Zimbabwean) Ngoni Kudenga was born in Zimbabwe in 1952. He is a Chartered Accountant and holds a Bachelor of Ac
Group Companies Directorate African Banking Corporation International Limited Chairman O M Chidawu M Mbaakanyi D T Munatsi F M
African Banking Corporation Zimbabwe Limited Chairman N. Kudenga H Brits F M Dzanya F R G Read J Sibanda Registered Address: AB
Organisation Structure - ABC Holdings Ltd ABC Holdings Ltd (listed on BSE & ZSE) Tanzania Development Finance Company Ltd Iroko
Governance Structure - ABC Holdings Ltd ABC Holdings Ltd (Board of Directors) Nominations Committee Executive Committee Audit a
Operational Overview h Et io pi an se rv in 18 pl g at te r/S pr in g ro lls
Chief Executive Officer’s Report Overview The group’s performance in 2005 showed marked improvement over prior years with posit
Other income increased from BWP139 million to BWP145 million, with the major contributor being the mark to market gains arising
Investment banking division showed good growth in Zambia and Zimbabwe in both local currency terms and Pula terms. Assets under
Capital Adequacy ABC Holdings Limited Capital Adequacy statement as at 31 December 2005 2005 % CAPITAL ADEQUACY OF ABC BANKING
Products and services CORPORATE AND INTERNATIONAL BANKING The Corporate and International Division has highly motivated and pro
• creating innovative financial structures to achieve clients' strategic goals consistent with their cost and risk management o
Group Management Committee Douglas Munatsi-Chief Executive Officer Douglas Munatsi was born in Zimbabwe in 1962. He has been Ch
Risk and Governance Sh g an aa n wo e od n B 26 w o l/B re ad s of th e wo rld
RISK MANAGEMENT Effective risk management is critical in a complex organization like ABC Holdings Ltd (“ABCH”). A strong and so
Management Framework on a regular basis to capture new policies adopted by the Board of directors. statutes, central bank super
The Board has defined and documented a credit policy for the group which forms the basis of credit decisions. This policy inclu
The Risk, Loans Review and Audit committee is responsible for monitoring operational risk, reputational risk and other risks no
Country operations have their own boards, with external representation and function within the requirements of their jurisdicti
remuneration policy . It fixes the remuneration packages of individual directors within agreed terms of reference, in order to
Corporate Social Investment African Banking Corporation Holding (ABCH) is a responsible corporate citizen and it invests in, am
Annual Financial Statements M o or cc an c s ou co us 34 pl at te r/S wi ss ch ee se
Contents Directors’ Responsibility 36 Report of the Independent Auditors 37 Directors’ Report 38 Consolidated Profit and Loss A
Directors’ Responsibility Responsibility for the Annual Financial Statements The directors are responsible for the preparation,
Auditors’ Report 37
Directors’ Report Nature of Business ABC Holdings Limited is listed on the Botswana and Zimbabwe Stock exchanges and is the hol
Directors’ interests in transactions Any interests by Directors in transactions between the company and third parties were disc
ABC Holdings Limited Consolidated profit and loss account for the year ended 31 December 2005 Inflation Adjusted 2005 Notes Int
ABC Holdings Limited Consolidated balance sheet as at 31 December 2005 Inflation Adjusted 2005 Notes ASSETS Cash and cash equiv
ABC Holdings Limited Company balance sheet as at 31 December 2005 Historical Cost 2005 Notes ASSETS Cash and cash equivalents I
ABC Holdings Limited Statement of changes in shareholders' equity for the year ended 31 December 2005 ATTRIBUTABLE TO EQUITY HO
ABC Holdings Limited Consolidated cashflow statement for the year ended 31 December 2005 Inflation Adjusted 2005 Notes CASH FLO
ABC Holdings Limited Consolidated cashflow statement for the year ended 31 December 2005 Inflation Adjusted 2005 Notes 1 Reconc
Significant accounting policies value on the balance sheet and it is usually possible to determine Statement of compliance The
Transactions eliminated on consolidation Intra-group balances and transactions, and any unrealised gains arising from intra-gro
of loans and advances that are identified as being impaired based on regular reviews. The amount of impairment is the group’s c
If the recoverable amount of an asset is less than its carrying amount, the carrying amount is reduced to its recoverable amoun
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 1.
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 4.
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 6.
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 8. EARNINGS PER SHARE 8.1 Basic earn
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 2005 Historical Cost/ Notional Amoun
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 11
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 12
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 As % of Loans & advances Outstanding
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 13. PROPERTY AND EQUIPMENT Freehold
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 14
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 18
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 21
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 23
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 28
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 31. RELATED PARTY TRANSACTIONS Relat
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 BWP ‘000 32 SEGMENTAL ANALYSIS Infla
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 33 FINANCIAL INSTRUMENTS Exposures t
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 33.1 CURRENCY RIS
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Historical Cost 33.1 CURRENCY RISK A
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Up to 1 month BWP '000 33.2 INTEREST
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted Up to 1 month BWP
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Historical Cost Up to 1 month BWP '0
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Ownership of Ordinary Shares Nature
ABC Holdings Limited Notes to the financial statements for the year ended 31 December 2005 Inflation Adjusted 2005 BWP '000s 35
Shareholders’ Information K a ub m ug 74 /C ap uc ci no
Analysis of Shareholders Ranges 0 - 50,000 50,001 - 100,000 100,001 - 500,000 500,001 - 1,000,000 1,000,001 - 10,000,000 10,000
Notice to Shareholders NOTICE TO SHAREHOLDERS NOTICE IS HEREBY GIVEN that the seventh Annual General Meeting of members of ABC
ABC HOLDINGS LIMITED Incorporated in the Republic of Botswana on the 1st December 1999 Registration number: 99/4865 Form of Pro
NOTES: 1. A shareholder may insert the name of a proxy or the names of two alternative proxies of the shareholder's choice in t