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Johannesburg - FirstRand [JSE:FSR] expects loan growth to slow to between 7% and 9% in the second half and has set aside higher provisions due to the weakening credit environment, the chief executive of South Africa's second-largest bank said on Tuesday.
Sizwe Nxasana said FirstRand had set aside over R500m in additional provisions, on top of the R800m it set aside in June 2012.
"That's in anticipation of a tightening credit environment and a slowing environment where customers are going to find it a bit more difficult despite the fact that interest rates went down even further," he told Reuters.
"Customers' indebtedness is still a big issue."
Nxasana said the bank tightened up credit scoring on unsecured lending in the mass market last year, and is now becoming more vigilant with the middle-income market.
