CHAMWE KAIRA
Capricorn Group’s profit after tax declined 6.4% to N$1.87 billion for the financial year ended 30 June 2026, as the diversified financial services group faced higher funding costs, macroeconomic pressure and weaker economic conditions in Botswana.
The group, which operates mainly in Namibia and Botswana across banking, asset management, insurance and specialist finance, said its diversified income streams and balance-sheet management helped it navigate the challenging operating environment.
Basic earnings per share fell 6.4% to 343.7 cents, while return on equity declined to 15.6% from 18.2% in the previous financial year.
Despite the decline in earnings, net asset value per share increased 6.7% to 2,277 cents. Non-interest income rose 8.3% to N$2.62 billion and accounted for 47.7% of operating income, exceeding the group’s 45% target.
The increase was supported by transactional income, trading revenue and asset-management fees. Net interest income declined 1.9% to N$3.33 billion.
Total assets increased 3.9% to N$75.3 billion, while deposits grew 6.3% to N$56.22 billion.
The group’s consolidated loan-to-funding ratio improved to 83.6% from 88.8%, while its total risk-based capital adequacy ratio strengthened to 19.4% from 18.1%, well above the regulatory minimum of 12.5%. Liquid assets increased 18.9% to N$22.1 billion.
Credit impairment charges increased to N$457 million from N$315 million and were the main factor affecting earnings.
Capricorn said the increase was largely concentrated in Botswana, reflecting weaker economic conditions and financial stress involving a limited number of significant client exposures.
Gross loans and advances declined to N$51.5 billion from N$52.5 billion, reflecting softer loan demand in Botswana and lower loan uptake at Entrepo following the discontinuation of its automated Payroll Deduction Management System.
Operating expenses increased 7.6% to N$3.27 billion as the group continued investing in technology, skills, operational efficiency and customer experience. The cost-to-income ratio increased to 52.0% from 49.5%.
The group said it created N$5.8 billion in value for stakeholders during the year. This included N$1.4 billion for employees, N$1.3 billion for suppliers, N$1.3 billion in direct and indirect taxes, N$857 million for shareholders and N$29.7 million for communities.
A further N$868 million was retained to support future growth opportunities, while 86% of the group’s operating expenses were incurred locally.
Capricorn Group said Namibia’s emerging oil and gas sector, renewable energy developments and other growth sectors present long-term opportunities, although geopolitical uncertainty and uneven economic conditions are expected to continue influencing its operating environment.
Group chief executive officer David Nuyoma said the results demonstrated the resilience of the group’s diversified business model and financial foundation.
“Our 2026 performance demonstrates the resilience of our diversified business model, the quality of our people and the strength of our financial foundation,” Nuyoma said.
The group maintained its total ordinary dividend at 135 cents per share for 2026. This comprises a final dividend of 77 cents per share and an interim dividend of 58 cents per share. No special dividend was declared.
