Just a few months at the helm of Botswana Insurance Holdings Limited (BIHL), Catherine Lesetedi-Letegele now wants to turn the firm into a one-stop shop for financial services. In fact, she is looking to further the company’s diversification and spread its footprints. She spoke to Staff Writer KEABETSWE NEWEL
Botswana Insurance Holdings Limited (BIHL), CEO Catherine Lesetedi-Letegele is settling in her role as the head of the country’s major companies. The soft-spoken CEO looked comfortable in her surroundings, at the financial service giant’s headquarters in Fairgrounds Office Park. There was something moving-in about the office, but a homely feel about it too, augmented by Lesetedi-Letegele’s staff who always exude a sense of control and relaxed calmness. You are welcome but not in an in-your-face overly polished way. The exquisite décor; immaculate walls and carpeted floor as well as the smell of the cozy furniture one enjoys at the first step into the office. Lesetedi-Letegele’s office is nothing but alluring. Not too big, yet very comfortable.
We are in the business of wealth creation, therefore ensuring that our products and services always remain relevant to our socio-economic context is central to our business strategy
Lesetedi-Letegele heads an empire valued at almost P5 billion putting her among the five most powerful CEOs in Botswana. You would not tell from the way she carries herself, Lesetedi-Letegele welcomes you with the warmth of a favourite aunt, when you ask a probing question she considers it the way your Philosophy professor would, as a precious opportunity to explore a new interesting idea, not an uppercut to be parried. Somehow BIHL seems to consistently provide CEO of a special kind, open, relaxed and ready for interrogation, Lesetedi-Letegele’s nature is no different to Hassam Gaffar, who recently left for a regional position.
Banter aside, Lesetedi-Letegele has big plans for the BIHL, part of a progressive strategy of the Botswana Stock Exchange (BSE)-listed outfit. “I want to position BIHL in such a way that it becomes a one-stop shop for all products within the group,” she says. To her this would make all BIHL group products accessible at one point. The financial services behemoth offers both life and short term insurance services. It also offers investment management services at Botswana Insurance Fund Management (BIFM) and Botswana Life which has become the lifeblood of BIHL.
Lesetedi-Letegele says that while competition remains very tight in the insurance market, she together with her team will ensure that Botswana Life Insurance Limited (BLIL), the life insurance unit, remains a market leader. “We will do this by innovation, making sure that we are always the first to always introduce a new product in the market so as to remain relevant to our clientele,” she stresses.
by the end of 2014 Botswana Life continued to be a dominant market leader with 72.8 percent
A few weeks back Botswana Life, headed by CEO Bilkiss Moorad introduced three new products, the first of its kind in the market. These are the Poelo Term Assurance, Isago Investment Plan and |Tapologo Retirement Annuity. “Poelo is the first Life Insurance product of this kind available in the market offering Botswana Life clients a 15-year minimum term period, after which they get all their Life Cover Premiums back plus 20 percent extra.
We are in the business of wealth creation, therefore ensuring that our products and services always remain relevant to our socio-economic context is central to our business strategy,” she says. Isago Investment policy holders are permitted a minimum of 10 years (with death benefits) subsequently resulting in greater value of investment and total premiums paid back.
Lesetedi-Letegele takes pride in that these products do not only offer family protection but are partly an investment solution, all in one pack. She believes that with these products Botswana Life will remain relevant in the market and also protect its market share. Botswana Life faces increased competition from nine other insurance companies. Lately, Bona Life also penetrated the market and will be wrestling in the same space as Botswana Life.
BIC controls over 23 percent of the general insurance market
Lesetedi-Letegele agrees that with increased competition, some market share will be lost. “However, our aim is to retain or keep profits and shareholder value rising year on year, because what matters is the bottom line,” she said. Botswana Life used to command over 80 percent of the insurance market. Latest available information, according to the Non-Bank Financial Institutions Regulatory Authority (NBFIRA), shows that by the end of 2014 Botswana Life continued to be a dominant market leader with 72.8 percent (compared to 72 percent in 2013) of gross written premiums as at the end of December 2014; representing just under 1 percent increase over the prior year.
Gross premiums in the life insurance sector are just around P3 billion. Further, BIHL remains significant in the general insurance market. Recently, it acquired 50 percent of the issued share capital of Teledimo Proprietary Limited, a company which directly owns 50 percent of the shares in Botswana Insurance Company (BIC).
BIC controls over 23 percent of the general insurance market, but it remains a leader in insurance in Botswana, which also gives BIHL Group an edge. Lesetedi-Letegele says that BIC is also readying itself for the introduction of cutting edge retail products.
Lesetedi-Letegele also says that BIHL will continue being a diversified outfit which benefits the shareholders by deriving widespread value.
“I am very happy with the value we derive from our associate investments and we will keep on increasing our stake in such companies,” she says, referring to the blue-chip microfinance firm, Letshego Holdings Limited, as well as Funeral Services Group (FSG), the largest undertakers.
BIHL owns over a 25-percent stake in Letshego, which makes it the second largest investor in Letshego. Lesetedi-Letegele said through BIHL investments in Letshego, the company now has an indirect association to its investments. Letshego operates in over 10 countries and has of recent penetrated the commercial banking space as well as deposit taking. BIHL now has two indirect investments in banking. That is through Letshego’s bank in Namibia as well as its 25.1-percent stake in Nico Holdings Limited, a diversified Malawian financial services firm.
growth is eminent despite a reduction in assets
The company is involved in general insurance, life insurance, pensions administration, banking, mortgage finance, lease finance, asset management and information systems as well as the hospitality industry, real estate holding and shopping centres through its subsidiary companies, which further spreads BIHL. FSG which is owned around 23 percent by BIHL also offers diversity for the group.
The BIHL boss says that new products are also in the offing which “will be announced soon”. Further, she says FSG has bought a business in the North West Province of South Africa, underwritten by Sanlam, a shareholder in BIHL. “We intend to also move into Zimbabwe,” she quips, while admitting that the recent events in Botswana’s northern neighbour has added a darker shade to their plans. However one gets the feeling it is a matter of when rather than if, before the financial services bull is walking the streets of Harare.
At Bifm, Lesetedi-Letegele says that growth is eminent despite a reduction in assets under management. She takes pride in the fact that Unit Trusts, the latest of Bifm products is doing well. This in her view is a product that services even the low income Batswana, the affluent as well as corporate clients.
“We are also vigorously wooing smaller retirement funds and societies so as to enlarge our portfolio…”
“We are seeing an impressive growth in the subscription of unit trusts” she says. By having a diversity of investment products, reduces the dependence of Bifm on pension funds, especially large ones such as Botswana Public Officers Pension Funds (BPOPF), while admitting that the major pension funds will continue to feature prominently in the subsidiary’s long term view.
“We are also vigorously wooing smaller retirement funds and societies so as to enlarge our portfolio and be accommodative to various institutions and individuals,” she reveals. Bifm in her view also is looking to manage funds on behalf of foreign investors in the areas where BIHL has a footprint
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