S.A's Capitec profits in line with forecasts - CNBC Africa

S.A's Capitec profits in line with forecasts


by Reuters 0

Photo: Wikipedia

JOHANNESBURG (Reuters) - South African lender Capitec Bank Holdings reported a 26 percent rise in full-year profit on Wednesday, in line with forecast, as growth in client numbers boosted both interest and transaction fee income.

Capitec, which grants loans not supported by assets, said it gained 1 million active clients, to total 7.3 million customers, over the past year as feeble growth in Africa's most advanced economy forced thrifty South Africans to shop around.

Capitec posted diluted headline earnings per share of 2,781 cents for the fiscal year ended Feb. 29, compared with 2,206 cents a year earlier. The lender had flagged earnings could rise by as much as 27 percent.

"We expect difficult economic conditions to persist. We see this as an opportunity to gain more clients as they look for value and better service from their bank," Capitec said in a statement.

Though transaction fee income rose 16 percent to 3 billion rand ($197.56 million), interest income remains Capitec's largest source of revenue, increasing 16 percent to 12.5 billion rand.

"We expect continued pressure on employment and the economy," the bank said.

($1 = 15.1850 rand)

(Reporting by TJ Strydom; Editing by Biju Dwarakanath)