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Dear Valued Partner,

The financial year ended June 2020 will probably be remembered as a year where businesses faced an overall economic environment which possibly could not have been predicted and required a very robust and instant response to an ever-evolving business climate. It has been challenging for all organisations and we are no exception.  Given the dynamic working conditions which most businesses faced during the Covid-19 pandemic, we consider our financial results for the year under review as very encouraging. That is not to say that the future is looking brighter or clearer but we can assure our stakeholders that the performance for the year ended is certainly going to provide a suitable cushion for economic shocks, which do remain difficult to quantify.

All key performance figures and ratios have shown a satisfactory improvement. Our collective research and guidance from the Board indicated a deterioration in the credit environment. The interest rate decline was also visible and forecasted by us and that our liquidity would produce lower earnings was known. We introduced robust risk parameters and risk mitigation strategies to protect capital and reduce the impact of credit impairment on our asset book. This enabled us to disclose a Net Profit after Tax of MUR 1.5bn, a sustained performance in contrast to the previous financial year. The continued faith in our strategy was ratified by our customers’ deposits reaching a level of MUR 150.9bn and disclosing a growth of 15% over one year. Our loan to deposit ratio at 19% clearly indicates our strategic intent to have a well-researched and cautious credit growth desirable under the current circumstances. This also enabled our Liquidity Coverage Ratio to be maintained at an average of 349% for the quarter ended 30 June 2020 against a regulatory limit of 100%. The Bank is surely well positioned to navigate an uncertain business environment.

The pandemic did bring forward economic challenges but it also brought a sharper focus on how to connect with customers, how to service their requirements and provide them with an assurance that the new normal is in no way compromising the security of their savings and their intended use. On the other side, the ever obliging and customer-focused employee had to be comforted by working from home. These were some challenges and client and employee health and safety came to the forefront as well. We responded to the new operating requirements promptly and diligently. To ensure that we have been and are still doing the right thing, we also initiated a customer survey to measure the satisfaction levels of our client base as regards to servicing their needs. The results were a delight as, overall, it was indicative of the fact that we have improved our service standards appreciably. I take this opportunity to thank our clients for the motivating response and their feedback on areas requiring improvements, which we will address as a priority.


Chief Executive Officer

The current year will remain one where we will see soft interest rate environment, stress heightening in the credit portfolio, high volatility in the bond market and a contraction in businesses of our customers. This environment demands a cautious approach to growth and a much frequent contact with existing clients so that we assist wherever possible and required. We have geared ourselves for this rather difficult business conditions. Our Risk Management framework is relevant to this market and is constantly reviewed to ensure it protects our financial health at all times.

Another challenge has been the addition of Mauritius to the EU Blacklist and FATF Grey List. We will, alongside the regulators, assist in this being rectified the soonest as the operating environment does not deserve such a harsh decision. That said, new business flows will be significantly restrained and opportunities for growth in the Global Business segment are likely to be reduced.

Despite the headwinds, our key focus areas remain customer experience, team work, innovation and sustainability. We will continue to improve in these areas through some key initiatives

Creating value for our Shareholders, Clients, Employees and Investors

We will continue to design a purposeful banking service for our stakeholders. The need is to remain flexible to be able to grasp the opportunity for growth. Our 19% Loan to Deposit ratio appropriately positions us to capitalize on asset growth opportunities. The effort to enhance cost efficiencies and productivity will remain in the forefront.

Re-wiring our Digital Transformation Journey

2019-2020 has shown the extent to which the world is inextricably linked and technology is a catalytic agent in offering innovative solutions to grow our clients’ businesses and optimise their wealth. Our digital roadmap is anchored on a set of forward-looking initiatives for a faster response time to market, improved business scalability and agility and to create a positive impact on all pointers of the value chain. Accordingly, we have instituted a “Technology, Digitisation and Platforms Committee” and set up our Technology Hub to aid the incubation of digital projects along our transformation journey.

Towards a Sustainable Banking Industry

It is our responsibility to steward our resources to create a meaningful social impact by reconciling financial performance with long-term value creation. Through our sustainability agenda, we want to move from shareholder capitalism to conscious capitalism by embracing a purpose geared towards sustainable value creation for all stakeholders. We have aligned our business practices with global standards set by the UN Global Compact and Global Reporting Initiative.

A word of Thanks

This is an opportunity to thank the previous Board and my Management Team and also to welcome the reconstituted Board who have supported us in our growth journey. My sincere appreciation goes to all AfrAsians who have portrayed the highest levels of dedication and perseverance in navigating the COVID-19 tides with head held high. Thank you to all our Shareholders and Clients for their trust in our capability to serve you best.

This message will not be complete if the excellent work being done by a passionate team under the umbrella of AfrAsia Foundation is not mentioned. We believe in caring for our society and the effort we have placed in bringing impactful education to under-privileged children is remarkable. It is not just allocating resources but involving our staff and clients in active and meaningful participation towards this cause is just exceptional. A special thanks to our shareholders to make this effort a rewarding one.

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