Capitec’s remuneration committee says it took into account the “outstanding performance of a strong leadership team” over the past two years and during the Covid-19 period to determine executive pay in 2022.
- Capitec has reported 17% annual growth for five consecutive years.
- It says it shows the power of his business.
- Underlying profit rose 17% to 4.7 billion rand for the lender’s half-year to the end of August
- Get the biggest business stories emailed to you every weekday, or go to Home page of News24 Business.
Capitec, South Africa’s third-most valuable bank, posted 17% compound annual growth for five consecutive years, saying it was a sign of the underlying strength of its business, given a period marked by civil unrest, the pandemic and the war in Ukraine. , as well as the devastating floods in KwaZulu-Natal.
Underlying revenues rose 17% to 4.7 billion rand for the lender’s half-year to the end of August, nearly 60% above pre-pandemic levels, while active customers rose 13% to 19 million and transactions on its banking app jumped more than twice.
Easing Covid-19 conditions have seen the bank return to pre-pandemic risk appetite, with total loan sales and disbursements rising 35% to 26.5 billion rand, although it said on Thursday that with recent interest rate hikes and cost of living pressures on consumers, it tightened its criteria, leading to more muted growth as the period approached.
The lender increased its interim dividend by 16.67% to 14 rand per share, 85% higher than it paid in the six months to the end of August 2019, and a payout of about 1.62 billion rand.
The group’s loan interest income increased by 13% to 7.4 billion rand, also due to higher interest rates, as well as growth in the gross loan portfolio, which increased by 18% to 77.9 billion rand.
The firm also reported a 16% rise in “quality banking customers” to 5.1 million, which it said helped boost transaction volume. A quality banking customer is a customer who has stable income in his account and stable use of the product for 3 consecutive months.
Speaking during a presentation to investors on Thursday, Capitec CEO Gerry Fourie said the firm was concerned about global and local uncertainties, including a recession in major global economies, geopolitical uncertainty, particularly in Europe, and aggressive monetary tightening. policies by global central banks. .
While inflation was expected to begin to decline by around September and perhaps interest rates would begin to decline in 2023, it now looked like these issues
“It’s a tough economic environment that needs to be managed very, very carefully,” he said.
SA’s biggest challenge at the moment is load shedding, he said, but there are some positive signs, including the positive impact of high commodity prices in terms of state tax revenue, as well as supporting SA’s terms of trade and thus randa
There were also some positive signs from the group’s banking perspective, with the pressure seemingly being felt by small businesses as well as customers, Fourie said.