Capitec client growth slows

Johannesburg - Annual headline earnings at banking group Capitec have risen by 44%, but its customer growth appears to be stalling.

Capitec posted full-year results to end-February on Wednesday, reporting earnings per share of 527c with income rising 29% to R2.5bn.

The dividend per share is up 50% from 140c to 210c, while the group grew its branch base from 363 to 401.

"We are proud of our people; we have good products and a niche in the market. We expect our growth to continue during the coming year," said group CEO Riaan Stassen in commentary accompanying the results.

While Stassen has been upbeat about growth prospects for the group, company results stated Capitec has 2.1 million customers - adding 50 000 since the interim period. In the previous year, the bank added about 500 000 clients to its base.

Provision for bad debts as a percentage of gross loans and advances decreased by 14% to 6.9%, compared to 7.9% in the previous year.

"From every perspective, this has been a commendable performance. It is the result of tightening our lending criteria more than a year ago and improving our operational efficiency," said Stassen.

While client growth at Capitec may be slowing after a phenomenal run since 2003, Stassen said the bank had been globally recognised.

He pointed to a survey conducted by the Credit Suisse Research Institute which polled over 3 000 analysts across the world to identify "Great Brands of Tomorrow". Capitec was the only African brand to be identified.

- Fin24.com

*The writer holds shares in Capitec.