The Development Bank of Southern Africa (DBSA) more than doubled its profits in 2022 because of growth in net interest income from lending, stabilised credit losses, more cash collections and repayments from development loans.
Net profit is up 168% to R3.8bn for the year to end-March for the finance institution, which is one of the shining lights in the failing state-owned enterprise landscape.
The government is the sole shareholder in the bank which supports municipalities and helps in developing infrastructure in the water and sanitation, transport, ICT, energy, education, health and human settlement sectors.
“While economies deal with the lingering disruption to economic activities such as supply chain issues, it has been prudent to continue to project conservatively as overall recovery might be delayed,” CEO Patrick Dlamini said.
Infrastructure projects have helped drive local economic recovery since Covid-19 lockdowns ended.
The bank helped deliver infrastructure valued at R33.4bn, including a new school, 104 newly refurbished schools and 13 local government projects.
The bank remains well capitalised and has increased its capital base by 9.7% to R42.9bn. The debt-to-equity ratio improved by 13 percentage points to 88% and debt funding is down 5% to R56bn.
The DBSA said in June it planned to migrate more of its portfolio towards the just energy transition. The global aim of the transition away from fossil fuels is to achieve net-zero greenhouse gas emissions by 2050.
Over the past six years, the DBSA has raised $1.6bn in green funding from international financial institutions and had a total exposure to renewable energy in SA of R13.8bn by the end of January. Its total loan book at end-September was R100bn.
Correction: August 19 2022
A previous version of this article incorrectly stated that net profit was up 168% to R3.8bn for the year to end-June.
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