ABIL reports YoY disbursements decrease

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The unsecured lender saw disbursements decrease to 5.56 billion rand for the first quarter ended 31 December 2013 from 7.43 billion rand for the first quarter of 2013.

“In line with our intentions, following our strategic initiatives implemented in FY2013, disbursements have declined on a year on year basis due to the application of more stringent credit granting criteria, an increased shift in focus to lower risk business and a difficult operating environment,”  [DATA ABL:African Bank Investments Limited] (ABIL) said.

“Disbursements increased by 11 per cent on a quarter on quarter basis due to the cyclical increase associated with the last quarter of the calendar year.”

Average loan size however, increased by 11 per cent year-on-year while the average loan term increased by eight per cent year on year from 49 months to 53 months.

“Loan term and loan size increased on a year on year basis reflecting the move to lower risk customers. These figures have decreased marginally on a quarter on quarter basis, mainly as a result of shorter term prime loans offered to low risk customers, launched in October 2013 currently comprising two per cent of disbursements,” said ABIL.

Gross advances increased by four per cent quarter on quarter from 58 billion rand in the fourth quarter of 2013 to 61.4 billion rand in the first quarter of 2014.

“The group has emerged in a stronger position from an extremely challenging year and has now entered a new chapter in its history. Our strategic actions undertaken in 2013, and the improvement in the quality of new business written, are expected to produce improved results in the second half of FY2014,” said ABIL group chief executive, Leon Kirkinis.

“ABIL and its people are refocused and reenergized, committed to its purpose of improving the lives of millions of ordinary South Africans by providing access to affordable financial services and responsible credit, while providing attractive shareholder returns in the medium to longer term in a challenging market.”