South African banking group Capitec has recorded an R9.7-billion increase in earnings in the financial year to February.
This is a huge jump after the banking group posted an R8.4-billion earnings in the previous financial year.
Capitec now serves a third of the population and its earnings have grown by 15% despite a tough economic climate that continues to place consumers and businesses under massive financial pressure.
The overview of financial results show that Capitec’s operations income grew to R30.3-billion and was offset by an increase of 80% in the credit impairment charge due mainly to the deteriorating economy and the impact of higher inflation on the bank’s clients.
The banking group has also increased client numbers, which grew 11% to 20.1-million customers.
Capitec CEO Gerrie Fourie said: “We’re motivated by the trust that our clients place in the brand, especially in these tough economic times. We remain focused on our fundamentals and continue to innovate to bring value to our clients and employees.
“We strongly believe that South Africa is a country of immense potential and growth opportunities and [we] invest in initiatives that will allow us to unlock this potential.
“Companies should work together with government and rise above the challenges, remain positive, seek opportunities, and take action.”
Earnings per share rose 14% to R84.20 from R73.71 in the previous reporting period.
Capitec declared a final dividend of R28, taking the total dividend for the year to R42 a share.
Despite very challenging economic challenges faced by the country, many customers continue to utilise the services of Capitec citing its low bank charges.
For a bank that entered the tough market in 2000 and mainly starting off in the rural areas, Capitec has remarkably transformed itself to compete for a lion’s share with its competitors – FNB, Absa, Standard and Nedbank.
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