Development Bank of Southern Africa ‘is bullish’

While some state-owned enterprises (SOEs) are still reeling from the impact of state capture, government’s wholly-owned Development Bank of Southern Africa (DBSA) – with a R110 billion total asset base – has remained bullish about succeeding in a rapidly changing economic and political landscape.

With SA Airways, Transnet, Denel and Eskom among several SOEs affected by the state capture, experts estimate it has cost the economy over R100 billion.

DBSA chief financial officer Zodwa Mbele told The Citizen in a wide-ranging interview that the bank had over years stuck to its fiduciary duty – maintaining a high level of transparency, accountability and ethics in its financial operations.

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Mbele, said the DBSA had succeeded to navigate uncertainties – “adapting its financial strategies accordingly”.

She said: “It is exceedingly difficult to cushion yourself out of the changing economic landscape. It will always be there – the global economic phenomenon to take place every now and then – like the political landscape.

“The DBSA has been a global entity in the sense that we also borrow offshore – not insulated from what is happening. “It does require proper planning, risk mitigation measures that need to be put in place to absorb the shocks of the market, because we are vulnerable to global economic events.”

Mbele said measures were in place to assist DBSA a great deal in the event of unforeseen and adverse economic and political changes.

Despite being owned by government, the bank has a solid governance structure, “which is noticeably clear and robust and there is no political interference”.

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The DBSA board, said Mbele, runs the business of the day together with management. “Of course, the shareholder does meet us at the AGM (annual general meeting) to discuss any further refinements that are required to execute our job.

“We have a clear framework and corporate plan on what needs to be achieved. This is communicated to the shareholder in a three-year cycle.”

She said the DBSA played “a very transparent” game.

“Not only do we adopt the international financial reporting standards, which are harmonised and understood by whoever reads our report – we publish our reports on our website and account to parliament.”

On major projects underway, Mbele said the bank engages in different sectors [and] in different countries. “The focus in South Africa is more on the infrastructure that is catalytic in terms of economic development.

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“We’re now talking about the energy crisis. We’ve always and we continue to be involved in the energy sector – both with Eskom and the independent power producers.

“Additionally, we are engaged in the development of water sector programmes to enhance their bankability – all of which align with social upliftment initiatives.”

Mbele said the DBSA was “deeply committed” to social infrastructure projects, which include funding initiatives for human capacity development, education and healthcare facilities.

“Beyond SA, we participate in different projects, which vary depending on which country we are involved in – driven by the energy sector.

“We are also looking into roads infrastructure related to transportation. In some countries, we are looking at the rail projects.”