Capricorn Group’s list of material reporting matters was first identified by a diverse internal team in 2016 and was included in the 2016 Integrated Report. In January 2017, the Capricorn Group board and executive team reviewed the material matters, given changes in the external environment, the group’s risk profile, expanded footprint and evolving strategy. The adjusted list was included in the 2017 Integrated Report and up to that point reflected a predominantly internal perspective.
For the 2018 report, the material matters were tested with Capricorn Group’s external stakeholders to achieve the following:
- to test the material matters for robustness, relevance and gaps
- to enable the Capricorn Group team to start building and owning relationships with material stakeholders
- to identify any new stakeholder concerns and expectations or topics for future engagement
Capricorn Group believes that stakeholder engagement is important because it:
- enables the group to sense the needs of stakeholders and to respond appropriately
- ensures engagement with stakeholders in a customised, coherent and consistent way across the group
- enables better planned and more informed policies, programmes and products/services aligned to stakeholder expectations
- supports the group’s other strategic initiatives
- positions stakeholder engagement as an enabler of the group’s business success
- facilitates effective internal collaboration and knowledge sharing about stakeholder interests, needs and positioning
- communicates the importance that the group places on engaging with its stakeholders
Read more about stakeholder engagement highlights for the year in the BSEC report on page 104.
The main stakeholder groupings for the material matters engagement were identified as:
- strategic alliances
Engagement with stakeholders took the form of individual interviews, focus groups and an online survey which were undertaken in Namibia, Botswana and Zambia, the countries in which the group operates.
Feedback indicated that all the matters identified by Capricorn Group are also material to stakeholders. The engagement highlighted different areas of emphasis within the scope of the material matters, which were applied to the refined list and submitted to the Group board. The material matters were approved by the board in January 2018 with recognition that non-performing loans and credit risk are emerging issues for the group. The material matters for 2018 are:
- Meeting individual customer needs and expectations
- Fintech, insurtech and evolving digital assets
- Demands for specialist skills driving focused development, training and diversity initiatives
- Liquidity, credit risk and regional economic growth prospects
- Mitigating financial crime, corruption and fraud
- Environmental, social and governance challenges
- Enhancing and optimising management and operational systems
- Responding to a changing regulatory and operating landscape
The group’s key risk indicator dashboard provides data to measure aspects of the material matters.
Megatrends such as urbanisation, enabling technology and globalisation contribute to changing customer demographics, needs and expectations. Needs range from advice on personal financial options to tools to increase financial literacy, access to infrastructure and a range of convenience expectations. A further megatrend relates to the consumer shift towards personal trust relationships enabled by technology.
Customer centricity is becoming a core competency for banks, with data management, statistics and analytical modelling essential capabilities. A customer-centric approach is critical to creating value and requires insight into the evolving characteristics and needs of current and prospective customers, as well as customers’ customers. These insights inform increased product flexibility and the identification of market opportunities.
Through its brand proposition, Capricorn Group made a promise to all customers to be a catalyst of sustainable opportunities. The group continues to refine its customer value proposition by organising the business around customers instead of products or channels and improving the customer experience by integrating sales and service efforts.
Bank Windhoek is a member of the Bankers’ Association of Namibia and subscribes to the Code of Banking Practice in Namibia. The voluntary code sets standards of good banking practice for financial institutions to follow when dealing with customers. The fundamental principles of the code include acting fairly and reasonably in customer dealings, promoting better-informed decisions about banking products and services, and ensuring that all products comply with the relevant laws, regulations and standards
Initiatives that support the group’s intention to meet customers’ needs and expectations include the opening of a new in-house customer contact centre in June 2018, providing a 24-hour inbound service for all three banks. Apart from saving the group about N$2 million per annum, the new contact centre will significantly improve customer service by delivering seven new additional services, first-time call resolution and an outbound sales and social media capability.
A further initiative is the “branch of the future” design project. The new design aims to optimise the customer experience while reducing the size of the typical branch layout, saving on employee and rental costs. The flow in the branch will adhere to world-class principles, making optimal use of space and shortening process times.
All three retail banks, Bank Windhoek, Cavmont Bank and Bank Gaborone, conducted customer service research to establish overall customer satisfaction and loyalty, based on the quality of service delivery, and customer experience, measured on a number key metrics. A high level summary of the results follows below.
Bank Windhoek and Bank Gaborone’s retail banking customers have excellent perceptions of overall service delivery in the branches, and Cavmont Bank performs well in the areas of credibility (honesty and trustworthiness of staff) as well as safety and security. Bank Windhoek’s reputation is also highly regarded across its client base, which reflects the strong brand equity that has been built over time.
Positive service perceptions across the wealth, wholesale and corporate segments are largely driven by the relationship managers who provide excellent, personalised service to clients and make it easy to deal with each of the entities.
Going forward, the banks have the opportunity to build on the superior service delivery by its people through the innovative use of technology in transactional banking services, products and digital functionality, to address future customer needs.
The customer survey results will be used to develop action plans for implementation in the new financial year.
Customer complaints are tracked across Capricorn Group by all entities with overall results indicating an increase of 69% from 970 in 2017 to 1,638 in 2018. The significant increase follows improvements in the registration processes of complaints received and the implementation of a customer strategy dashboard.
Compliments increased by 255% from 431 in 2017 to 1,532 in 2018. Bank Gaborone receive the highest number of compliments.
More process improvements are underway as the entities use different measurement and recording methodologies. The customer strategy team is in the process of enhancing the customer complaints and compliments processes through a policy, which will standardise recording mechanisms and dashboards, and allow for improved management of complaints and compliments. This will further enable trend identification and analysis, the mining of customer insights, severity levels, root cause identification linked to Treating Customers Fairly principles and the channels used by customers to log complaints and compliments.
Media coverage is tracked on a monthly basis in Namibia to determine any reputational risk. The positive position of Bank Windhoek in the media is maintained by ongoing and proactive media engagement, while any negative commentary is managed through relationships and by communicating the bank’s stance and initiatives in place to address any issues.
Disruptive innovation is inherent in the terms “fintech” and “insurtech”, which relate to the ways new technology is applied to traditional financial services practices, products and systems. Disruption takes many forms, rendering some offerings obsolete and significantly affecting pricing. An example is the launch of digital-only banks with no branches and using free, open-source technology.
Fintech offerings often originate from non-traditional competitors who are designing flexible and dynamic solutions in direct competition with banks.
Blockchain technology, for example, can facilitate the real-time, open-source and secure transmission of data and value, which has attractive potential for payment systems and new product offerings.
The dynamic nature of fintech offerings is a challenge for regulators, who are responsible for ensuring stable markets and for protecting customers. The emergence of crypto- and digital currencies have further challenged the notions of regulation, borders and financial value.
The BoN published a revised position on cryptocurrencies in May 2018, taking a strong stance against the use of these currencies as a method of payment for goods and services. It advises against using cryptocurrencies to store wealth, savings or earnings due to their unregulated and highly volatile nature.
Alternative currencies are nevertheless gaining global momentum, with cryptocurrency ATMs being launched in the southern African region. Cryptocurrency ATMs allow users to buy and sell cryptocurrencies for cash without requiring a bank account.
Read more about digital trends in banking earlier in this section on Capricorn Group’s strategic landscape.
Capricorn Group is making strategic and operational investments in fintech opportunities in support of its strategic choice to target technological and cyber opportunities.
Through Nimbus, the group made a strategic investment in Namibia telecommunication operator, Paratus, which is developing a regional bandwidth network connecting Namibia, Botswana and Zambia. Read more about the transaction and rationale in the leadership report on page 11.
In terms of its own operations this year, Capricorn Group developed its first, formal digital strategy in support of the group’s AsOne2020 strategy. This provides a focused approach towards investing in and growing the group’s digital assets. Digital roadmaps have been developed and are continually reviewed to extend to all channels, products, services and processes.
The Bank Windhoek ATM channel was refreshed to adopt the group’s latest corporate identity standards and, unique to the Namibian market, eight indigenous languages were added to the ATM functionality in addition to the customary English and Afrikaans.
Bank Windhoek’s EasyWallet offering has now been available for a full financial year, with uptake and use surpassing all expectations in terms of profitability. To support the Capricorn Private Wealth launch, uniquely branded internet banking and mobile app channels were developed. In Botswana, the Bank Gaborone internet banking solution was replaced by the group’s latest multichannel platform offering. In Zambia, the bank’s digital channel offering is in the process of being extended to include a USSD cellphone banking channel.
Resource availability and capacity remains an overarching constraint for digital delivery across all group entities. This is particularly challenging at Bank Gaborone and Cavmont Bank, resulting in the group taking a more centralised support approach.
Significant investment continues in the group’s enterprise data warehousing capability from which analytical insights will inform all future investments in physical and digital assets.
% Growth in mobile app use
% Growth in cell phone banking
% Growth in point of sales
According to the World Economic Forum’s executive briefing on The Future of Jobs and Skills in Africa, published in May 2017, employers across the region identify inadequately skilled workforces as a major constraint to their businesses. Professions currently trending on the continent include the creative industries; food technologists; 3D designers; data centre workers; and care, education and health workers. The briefing emphasises the need for future-oriented skills development and constructive public-private dialogue for urgent and fundamental reform of education systems and labour policies to prepare workforces for the future of jobs.
The Harambee Prosperity Plan recognises that the provision of quality skills is one of the major constraints to competitiveness in Namibia. The plan commits to addressing the gap between the demand for and supply of skilled labour by supporting practical training programmes and the streamlining of the system for the import of skilled labour.
Specific human capital challenges for Capricorn Group in Namibia include recruiting specialized skills such as digital and investment banking, creating a diverse and more inclusive employee value proposition for different generations, and maintaining high levels of employee engagement.
In Botswana, succession for key value roles remains challenging, especially in the short term.
Zambia’s most significant human capital challenges for Capricorn Group include building a strong leadership capability, providing a competitive remuneration proposition, and enabling employee engagement.
Capricorn Group’s growth ambitions require the availability of specialist skills, including technical and specialised competencies, qualifications and experience related to financial services, compliance and risk management, IT and digital development. With changing client demographics, the group’s skills requirements are also shifting, so that, for example, meaningful international experience and a global orientation are required.
Whereas certain skills may be limited or unavailable in each subsidiary’s home country, the formation of Capricorn Group has created a regional skills pool, with the potential to transfer skills and broaden career opportunities in the group as a recruitment benefit. The attraction and retention of engaged, high-performing and highly skilled employees remains critical and is underpinned, in all three countries, by the continued commitment to prioritise the development and employment of local skills to impact positively on employees, communities and the group.
Capricorn Group is in the process of re-evaluating the core and critical skills required to successfully lead the group into the future of banking. While the focus was previously on finding and attracting experienced banking candidates, this is no longer an absolute prerequisite. Skills are actively sought from various sectors, allowing for additional and extraordinary inputs from a completely different angle. The assumption is that there is strength and opportunity in a diverse workforce.
Internally, Capricorn Group is refining the previous Leadership Development Framework to establish leadership capabilities across the group linked to specific development plans and leadership programmes. The Capricorn Talent Academy’s in-house leadership development programme is evolving and all course content has been aligned to the new world of work and concepts like digitisation and exponential thinking. Content has also been mapped against the group competencies.
The Candidate Banker Trainee Programme remains one of the group’s flagship development and empowerment programmes for future bankers. The Graduate Development Programme continues to address the skills shortage within the retail banking space.
A survey was done to establish employee engagement levels in terms of commitment, willingness and retention. 78% of employees participated, of whom 75% are semi to fully engaged (key contributors and star performers).
From the survey feedback, it was evident that Capricorn Group employees experience high levels of cohesion, trust and mutual support among team members. They are aware of The Capricorn Way and recognise its impact. Employees understand the vision and strategy of the group.
Inhibitors to engagement include a lack of recognition, insufficient opportunities to develop and learn new skills, and the perception that employees are not able to voice their opinions or their opinions are not valued.
In response to the survey results, a recognition programme will be added to the existing reward framework to give employees the opportunity to recognise each other for living The Capricorn Way.
Future priorities include developing a pipeline of talent in the market for vacancies, including networking with schools of excellence to identify future candidates. This will be effected by proactive workforce demand planning and a revision of competency profiles.
A total investment of close to N$4.5 million was made in training initiatives, with a further N$3,153,868.0 allocated to external bursaries and studies for employees.
The indicators for human capital that are tracked group-wide on a monthly basis showed a positive increase in diversity, development and employment trends. However, there is a need to be more focused on training for racially disadvantaged employees, especially at senior levels, including development for female employees. With the roll-out of new leadership development courses there is an opportunity to target employees between the ages of 25 – 35 to develop emergent leaders. Staff turnover increased slightly, but the regretted losses were low.
Female permanent employees (%)
Racially disadvantaged permanent employees (%)
Women in senior management (%)
Women in middle management (%)
Racially disadvantaged in senior management (%)
Racially disadvantaged in middle management (%)
Non-Namibian workforce (%)
New employees age <24 (%)
New employees age 25 – 35 (%)
New employees age 36 – 45 (%)
New employees age 46 – 55 (%)
Staff turnover annualised (%)
Training hours Bank Windhoek, CAM and Namib Bou
Training hours Bank Gaborone
Training hours Cavmont Bank
A slowing and increasingly indebted economy poses a major credit risk to the Namibian banking sector. The legislative and regulatory framework for credit risk in Namibia, therefore, requires banks to establish credit risk management processes that provide a comprehensive view of their credit risk exposures. This is enhanced by comprehensive BoN internal on-site guidelines for credit risk reviews.
Economic growth is to a large extent aligned with concentration risk in a country. Where a country such as Botswana is highly dependent on diamond mining as a contributor to GDP, low diamond prices have a significant impact. In Zambia, GDP growth is closely linked to copper. Fortunately, these commodity cycles tend to be relatively short, which means that Zambia, for example, is now benefiting from an upturn following depressed copper prices in the past two years.
In Namibia, concentration risk is related to government expenditure, which has acted as a catalyst for growth in the past. In recent years, government investment in non-productive assets, a weakening exchange rate and spiralling debt resulted in a contracting economy, characterised by severe liquidity pressures.
With liquidity closely linked to economic growth, prospects in the region unfortunately remain subdued based on persistent challenges: high unemployment, weak commodity prices, fiscal strain, increasing debt and high inflation. Combined with the environmental, social and governance challenges listed elsewhere in this section, liquidity and business confidence is expected to remain under pressure.
According to Fitch Ratings in November 2017, cuts in public investment in Namibia have taken a toll on domestic demand and activity in the construction sector. The expansion of mining output has also been slower than expected due to weak uranium prices.
The Namibian government’s ability to meet its financial obligations remain uncertain. There is also concern about the way in which issues are being prioritised, and the systemic nature of these.
Distressed repayment ability of customers due to decline in growth as well as increased uncertainty is expected to remain challenging, particularly in Namibia, and to affect all participants in the financial services industry. This is most evident in the increased trend for non-performing loans. In Namibia, the ratio of non-performing loans to gross loans was at its highest level in 2010.
For Capricorn Group, credit risk is most evident in the rate of non-payment in loans, which deteriorated group-wide in the past year. Non-performing loans are calculated as the total loans in non-performing status (i.e. legal collections branch) divided by the gross loans and advances. The increase in non-performing loans is due to the effects of the deterioration of the macroeconomic environment and the various movements in the economy over the past two years. The trend is expected to flatten out in the next financial year. Recoveries are managed proactively and more focus has been placed on identifying clients at risk. Read more about credit risk management in the risk and compliance report on page 95.
Constrained and unpredictable market liquidity can impact Capricorn Group’s ability to fund the needs of the economy, thereby constricting growth. Guided by a liquidity risk management process and framework, the group strives to hold an adequate liquid asset surplus that can cater for unexpected outflows. The group has also put in place a N$1 billion liquidity facility to fund a committed contingency facility to the three operating banks. This has significantly reduced the liquidity risk within the group.
Reduced liquidity in a system typically results in higher cost of funding as entities have to compete for a shrinking pool. Read more about funding costs and the impact on margins in the leadership report on page 18.
The minimum requirement of liquidity to be held is set out by the central bank in each of the territories where the group operates. The banks measure the amount of surplus available compared to the minimum they have to hold on a daily basis.
The overall liquidity position in the group improved during the year, parallel to an improvement in the overall market. Liquidity risks remain evident in Botswana because of the possible centralisation of funds. This is being tracked and proactively monitored by Bank Gaborone and the group.
Bank Windhoek’s loan-to-funding ratio (LFR), which measures total loans divided by the total funding for the entity, is actively tracked by the BoN, which has expressed a concern that current levels are too high. Given the above, the LFR has improved in the year under review. There are action plans in place, which are actively tracked and monitored, to ensure Bank Windhoek complies with the BoN limits as required. Bank Gaborone remained stable over the year while Cavmont Bank improved on LFR
Liquidity surplus above minimum requirements
Globally, individuals and businesses are threatened by the rising number of incidents, the growing scale and the increasing complexity of financial crime, including money laundering, identity theft, card skimming and phishing. Failure to identify and manage these risks could result in damage to reputation and a loss of income, which would jeopardise the group’s growth and contribution to a stable and trustworthy financial services industry.
According to PwC’s 2018 Global Economic Crime and Fraud Survey, 53% of Namibian organisations have experienced economic crime. Junior management is perceived as the most significant internal threat whereas customers and hackers are identified as the main perpetrators of external fraud.
The survey further found that 92% of Namibian respondents were made aware of the most disruptive incidents of economic crime when these were brought to the attention of the board, executives or governance leaders from within their organisations.
The impact of financial crime, corruption and fraud is best mitigated by a collective and collaborative approach by the industry and relevant stakeholders. Sharing data and centralising resources are the most effective ways to identify risk and develop interventions that proactively prevent either systemic or unilateral threats.
Capricorn Group extended its proactive fraud detection capability and reinforced the values of personal integrity and ethics through culture-building initiatives and leadership development programmes.
The group uses technology to support the proactive prevention and identification of financial fraud before losses occur. Awareness campaigns aimed at employees and customers improve fraud awareness and empower people with the knowledge to stay informed about trends. Furthermore, internal awareness of information security priorities is created through device and data protection measures, incident responses and support mechanisms.
The group supports government law enforcement entities with investigations of financial crime.
Internal and external mechanisms for reporting concerns about unethical or unlawful behaviour and organisational integrity have been implemented. The group has a Code of Ethics and Conduct Policy to which all directors and employees are required to adhere. The BSEC has oversight of the Capricorn Group’s ethics risk agenda and ethics framework.
The introduction of chip card has significantly reduced card fraud losses at Bank Windhoek and Bank Gaborone. The proactive monitoring of card and internet banking further prevents fraudulent transactions. Bank Windhoek continues to focus on identifying fraud control failures and improving these.
Bank Gaborone launched specific initiatives to train employees on financial crime trends such as the use of fraudulent identification documents and card cloning. Customers received regular updates via SMS and social media platforms as to how they can protect themselves from fraud and financial crime.
Losses due to financial crime
According to the World Economic Forum’s 2017 Africa Competitiveness Report, the continent remains challenged by large infrastructure deficits, significant skill mismatches, slow adoption of new technologies and weak institutions. These factors, in addition to weak financial sector development and low levels of regional trade and integration, emerge as the main bottlenecks preventing African economies from providing an environment that facilitates better employment and entrepreneurship opportunities.
However, the continent’s young and growing population can be a catalyst for rapid development. A growing labour force and a large and emerging consumer market hold the promise of significant growth.
Financial institutions have the ability to initiate, facilitate and support the systems and projects that enhance competitiveness and stimulate the economy. In considering investment options, environmental, social and governance (ESG) concerns are becoming an increasingly important factor when evaluating large projects or developing new products and services.
The decision to fund a mining company, for example, has to consider potential environmental, labour, health and waste impacts on communities against financial returns. The opportunity to gain new market segments by offering solutions to previously unbanked customers has to consider obstacles such as physical distance, minimum balance requirements, little to no credit and low income flows.
Financial inclusion, in particular, has the potential to support a wide range of the United Nations Sustainable Development Goals (SDGs). It is a mechanism to reduce poverty, accumulate assets and increase economic participation.
It is widely recognised that digital financial services improve access while at the same time enabling banks’ ability to monitor transactions and activities in the financial system. This helps improve risk management, including the ability to prevent money laundering.
The potential impact of climate change as an environmental, social and governance challenge for the region is significant. The SADC region is particularly vulnerable to increased frequency of floods, cyclones and droughts which may damage infrastructure, destroy agricultural crops, disrupt livelihoods and cause loss of life. These impacts will increasingly influence investment and insurance decisions.
Multinational companies in emerging markets, such as Capricorn Group, are well positioned to deal with and meet regional challenges due to their diversified footprint, their ability to apply learnings from one territory to another and their approach to systemic risk management.
Capricorn Group’s stakeholders look to the group for leadership in economic value creation, while contributing to the sustainability of communities and the environment in the region.
During the year Bank Windhoek received funding and technical assistance from the Sustainable Use of Natural Resources and Energy Finance (SUNREF) initiative. SUNREF was developed by Agence Française de Développement (AFD) to support financial institutions and their clients to boost financing for projects for sustainable natural resources management, with a focus on clean energy.
SUNREF provides an affordable line of credit together with technical assistance and credit facilities to overcome financial barriers.
The SUNREF support enabled Bank Windhoek to actively facilitate the financing of various renewable energy projects, which in turn will result in long-term benefits to the Namibian economy. The following projects are underway:
- Aussenkehr and Trekkopje solar power plants
- Oab wind energy plant at Namdeb Elizabeth Bay Diamond Mine, near Lüderitz
- Okatope solar plant near Ondangwa
Various large-scale projects are in the pipeline and currently under investigation.
SUNREF also provided technical assistance that supports informed decision-making and employee education in allocating finance.
Social challenges are mainly addressed via the group’s corporate social responsibility (CSR) programmes. A guideline was adopted to allocate 1% of profit after tax for CSR initiatives group-wide. This target was exceeded. Activities for the past year included:
- social investment fund projects in line with the policy focus areas of job creation, entrepreneurship and education
- small and medium enterprise mentorship, training and development
- consumer education and financial literacy programmes and initiatives
- employee volunteer programmes
- fundraising initiatives for cancer through the Bank Windhoek Cancer Apple Project
- bursaries to employees and students
- employee training and development
- sponsorships in various fields
- sports development
- arts and culture development
- donations to social welfare projects including poverty and hunger alleviation
- environmental projects
- youth development
- animal welfare
In terms of addressing environmental challenges, and in support of the climate action SDGs, the group has launched a carbon footprint initiative this year.
Bank Windhoek continues to refine its environmental and social management system (ESMS) to ensure credit is allocated responsibly. Bank Windhoek’s environmental and social risk concentration is spread out over predominantly medium- (40%) and low-risk (36%) sectors, with approximately one quarter (24%) concentrated in high-risk sectors. As the group is exposed to several industries vulnerable to climate change impacts, the ESMS will be critical in identifying, mitigating and monitoring these risks. In Namibia, sensitive sectors include, for example, mining, agriculture, fishing, manufacturing and construction industries.
The ESMS is now fully embedded as part of the credit approval process. In the near future, developments in the ESMS will include building the management system into the online banking system, which will greatly improve usability and data quality and will allow staff to remotely access client information.
The permit reference manual will be launched in the next financial year, which will help credit employees ensure their clients are compliant with national environmental and social laws and regulations. They will be able to assist clients where the requirements are not met. Employees will also undergo continuous training in environmental and social risk management. As Bank Windhoek’s experience in applying environmental and social risk management grows, the ESMS will further be critical in identifying sustainable financing options, especially in water management and renewable energy.
Continuous change and innovation in systems, and the increasingly novel solutions offered by IT, bring opportunities for enhanced internal effectiveness and process optimisation. This, directly and indirectly, increases the positive impact on shareholders, employees and customers.
The critical success factors for retail banks seeking to achieve operational excellence generally include improving end-to-end performance, developing efficient and effective processes, streamlining the organisation and establishing capabilities that create winning conditions. Typical operational performance indicators include cost-to-income ratio, customers per full-time employee and new accounts per sales employee.
Capricorn Group identified operational excellence as the core component of its competitiveness, which has important implications for the group’s management style, corporate culture and performance management system.
Operational excellence relies on Capricorn Group’s modern, flexible and efficient core system, and the group’s ability to comply with international best practice in terms of efficient operations. The group’s existing portfolio review process enables the systemic identification of redundant or underperforming businesses across the portfolio and flags opportunities for cross-business collaboration. Risks related to the management of operational systems are addressed through a well-developed IT governance structure.
Platform alignment, build consistency and integration remain key priorities across all three countries, for example in point of sale systems, online and mobile banking. Detailed operational indicators are tracked by each bank to measure, for example, turnaround times.
Three key operational indicators are:
- Customers per full-time equivalent (FTE) which tracks the ratio of customers to full-time employees as a way to measure efficiency: the more customers managed per FTE the higher the efficiency in terms of process optimisation, automation and digital self-service.
- Sales FTEs as a percentage of total FTEs measure the proportion of the employee base that are sales employees, as an operationally excellent organisation will have a higher proportion of sales employees compared to back-office and support staff. This is an indication of efficient back-office processes and automation.
- New customers per sales’ FTE measure the amount of new customers that one full-time employee acquires. It indicates the efficiency and effectiveness of Capricorn Group’s sales and onboarding processes.
Operational excellence further relies on the support of central expertise, such as disaster recovery. A recent initiative by Bank Gaborone used group resources for the preparation, component upgrades and facilitation of the move to the disaster recovery site.
Customers per full-time employees (FTEs)
Sales FTEs as a percentage of total FTEs
New customers per sales FTE
Governments in the region drive policy and regulation, which should create conditions for social, political and commercial development, and can have a significant impact on the ability of Capricorn Group to grow and expand.
Regulators in sub-Saharan Africa are aligning themselves with global best practice in building a legislative regime that aims to foster trust and confidence in the sector and between its participants.
Commercial banking institutions, in general, are at the apex of the regulatory environment and are therefore constantly presented with amendments to the local legislative framework and the introduction of new statutes and regulations.
Regulatory focus in the banking sector has been on prudential requirements, anti-money laundering provisions and obligations such as client due diligence, enhanced due diligence, suspicious transaction reporting and the ongoing monitoring of clients and transactions; electronic transactions and cybercrime and consumer protection.
Across the three geographical jurisdictions, core emerging legislation is developing to ensure alignment to these trends in prudential requirements, including anti-money laundering and proliferation standards, electronic transactions and cybercrime and consumer protection.
Keeping abreast of these changes, creating awareness and constantly adapting is achieved through a well-considered and approved Compliance Programme aligned to the Generally Accepted Compliance Principles (GACP) advocated by the Compliance Institute of Southern Africa.
The following Acts were promulgated and/or came into effect in Namibia during the financial year:
- Flexible Land Tenure Act 4 of 2012
- Whistleblower Protection Act 10 of 2017
- BID 10 – Appointment, duties and responsibilities of auditors
- BID 30 – Information Security
Core emerging legislation in Namibia includes:
- BID 26 – Outsourcing
- Electronic Transactions and Cybercrime Bill, 2018
- Financial Services Adjudicator Bill, 2018
- Microlending Bill, 2018
- Financial Institutions and Markets Bill, 2018
The following Acts were promulgated and/or came into effect in Botswana during the financial year:
- Income Tax (Donations) Regulations 2017
- Proceeds and Instruments of Crime Regulations 2017
- Tribal Land Act No. 1 2018
Core emerging legislation in Botswana includes:
- Electronic Communications and Transactions (amendment) Bill 2017
- Competition (amendment) Bill 2017
- Consumer Protection Bill 2017
- Counter-Terrorism (amendment) Bill 2017
- Data Protection Bill 2017
- Companies Re-Registration Bill 2018
- Registration of Business Names Re-Registration Bill 2018
- Companies (amendment) Bill 2018
- Citizenship (amendment) Bill 2018
- Banking (amendment) Bill 2018
The following Acts were promulgated and/or came into effect in Zambia during the financial year:
- The Banking and Financial Services Act of 2017
- The Bank of Zambia Anti-Money Laundering and Combating the Finance of Terrorism or Proliferation Directives of 2017
- The Bank of Zambia Corporate Governance Directives
- The National Payment Systems Directives on Electronic Money Issuance
- The Companies Act of 2018
Core emerging legislation in Zambia includes the following:
- The Anti-Terrorism Proliferation Bill of 2018
- The Information and Communications Technology Association of Zambia Bill
- The Credit Reporting Bill No. 6 of 2018
- Zambia Institute of Marketing Act No.3 of 2003
- Draft SI on the Scale of Fees for Registered Valuation Surveyors
- Rules to guide the application of Section 146 to 149 of the Securities Act, 2016
Current engagement with regulators and governments is mainly at board and executive leadership levels and includes interaction with departments such as the Ministries of Finance and Industrialisation, Trade and SME Development, Private Enterprise and bank and financial institution regulators.
The group has a solution-based approach to regulatory change that aims to mitigate the risk of increasing cost and complexity, and to manage the trade-offs in capacity allocation to ensure that it maintains and improves the risk management and controls that are suited to the region’s financial and regulatory landscape.
The group complies fully with legislation and remains cognisant of its responsibility to maintain operating licences and protect its reputation and shareholder value. This includes comprehensive front-line training, systems development and technical support as well as engagement with the relevant regulators around implementation challenges and opportunities.
Compliance is proactively managed through the Capricorn Group Compliance Framework and the central risk and compliance departments. The group continually develops and manages the business risk and control framework to ensure compliance.