Fin24

Battle on for rural banking

2010-05-12 08:19

Bloemfontein - Wanted: a buyer for 22 bank buildings in Free State and Northern Cape rural towns.

After First National Bank [JSE:FSR] (FNB) recently decided to close 31 branches in rural towns in these two provinces, some towns planned to buy their FNB bank building to be used as a savings and credit cooperative.

Negotiations with FNB in this regard were under way - until the banking group took a business decision to advertise the 22 buildings it owns (it rents premises in the other towns) in a single tender.

Who would be interested in buying all these properties in a single transaction?

Perhaps a retail group wanting to expand its presence in the country, said FNB spokesperson Steve Higgins.

Or perhaps another banking group? Higgins declined to comment, but speculation in Free State towns favours this alternative.

Two banks are mentioned: Capitec [JSE:CPI], the bank with the low-cost business model, and Standard Bank which, for instance, still owns a building in Vredefort although it no longer does business there.

Capitec is enlarging its branch network where there is a need and is closely watching for market opportunities, said Sumarie Brand, head of communications and public relations. She denied, however, that the banking group had any plans to open branches in buildings vacated by FNB.

Standard Bank spokesperson Ross Linstrom responded to Sake24’s enquiry by saying that the bank was always on the lookout for new business and new opportunities.

He said the bank had no plans to close any branches in rural areas, and that refurbishments were in fact planned for branches in towns like Ladybrand, Kuruman and Kathu.

- Sake24.com

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