South Africa's Capitec Bank FY earnings up 27 pct on fee income - CNBC Africa

South Africa's Capitec Bank FY earnings up 27 pct on fee income

Financial

by Reuters 0

South Africa's Capitec Bank FY earnings up 27 pct on fee income. PHOTOS: Gallo Images

South African unsecured lender Capitec Bank Holdings Ltd reported a 27 percent increase in full-year earnings on Tuesday as growth in active customers boosted transaction fee income.

(READ MORE: Capitec rides tough lending climate)

[DATA CPI:Capitec Bank Holdings Ltd] said diluted deadline earnings per share came in at 2,206 cents from 1,740 cents a year earlier. It had flagged earnings could rise by as much as 27 per cent.

Transaction fee income was up 35 per cent at 2.6 billion rand ($218 million) after the lender's active clients increased by nearly 860,000. However, Capitec expects that to slow down next year following new limits on card processing fees.

While interest income rose 14 per cent to 10.8 billion rand, gross loan impairments also increased by 5 percent to 4.6 billion rand as a result of prolonged strikes in the mining sector, Capitec said.

Last year, Capitec's main rival in lending without collateral, African Bank, had to undergo rescue after it went under from a mountain of bad debt.

(READ MORE: Capitec drives decrease in S.African bank charges)

Bigger South African banks performed strongly in 2014 as they grew loan income while cutting back bad debt.

Capitec shares are up 37 per cent this year, outpacing a 5.6 percent gain in the Johannesburg's All-share index so far this year.

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