Audacious. It’s a word that one reads over and over in African Bank’s financial results for the six months to March 2022. Given that the bank is not as good at lending as Capitec, and is not as good a transactor as the big banks, perhaps audacity is exactly what it needs as it seeks its own place in the sun.
Certainly, the results are a far cry from the R27-million after-tax loss declared at the end of the 2020 financial year. The retail savings deposit book grew by 27% to R10.9-billion. Included in this is R1-billion in deposits from the new transactional myWORLD accounts, an increase of 57%.African Bank is also growing its market share, with the number of retail savings and investment accounts growing by 30% from 73,000 to 94,865 at the end of the period.
“We have not banked juristic persons since 1995, but we have made an inaugural loan, at commercial rates,” says Bungane. “It’s about building my franchise. The loan will be used to fund cellphone handsets, but it comes with strings attached – we have access to the people who get that handset.” “These results show that management is ticking the right boxes – retail deposits have grown, and the quality of the book has improved, but they are still nowhere near the level of profitability that a decent retail bank should be,” says Nolwandle Mthombeni, a senior banking analyst with Intellidex.