- Annual growth rates in the SARB’s gross loans and advances category is recovering after negative growth was recorded in March, April and May. In absolute Rand terms this category is at the same level it was in March 2020. On our methodology, industry advances growth was 1.5% YoY, 1.2% YTD and 0.9% MoM. The industry long term average is for credit growth to exceed nominal GDP growth by 0.9% p.a, indicating very depressed levels of growth at present.
- Residential mortgages is currently the strongest growing category (+7.5% YoY), followed by corporate overdrafts and loans (+5.7%), credit cards (+4.3%) and instalment sales (+4%). Foreign currency loans have declined by 16% YoY and corporate loans by 0.3%.
- Retail loan growth is considerably stronger at 5.5% YoY compared to corporate growth at -2.3%.
- Standard Bank is achieving the best YoY advances growth with 5.5%, followed by Absa with 4.6% and Investec at 0.7%. FirstRand and Nedbank both have contracting books (-2% and -1.9% respectively).
- Absa and Standard Bank are dominating the market share gains over the past 12 months. Standard Bank increased its total share of advances by 0.9% and Absa 0.6%. FirstRand and Nedbank have both seen 0.7% declines. Absa is gaining the most in commercial mortgages (+1.6%), instalment sales (+1.7%), corporate overdrafts and loans (7.8%) and foreign currency loans (+1.6%). Standard Bank has added 1.3% to its share of residential mortgages.
- FirstRand has lost market share in all categories apart from corporate loans. Nedbank has lost market share in all categories apart from personal loans
- Capitec continues to gain market share in credit cards with 8.3% YoY growth vs industry growth of 4.3%. The same holds true for personal loans where its YoY growth is 3% compared to the industry at 0.1%. African Bank’s personal loan book has fallen 8.8% YoY.
- FirstRand is dominating in YoY total deposit growth (+6%) followed by Absa (+3.2%). Nedbank and Standard Bank have seen negative growth in deposits YoY, although in the case of Standard Bank its in its wholesale deposits as retail deposits are growing at 6.6%.
- Deposit growth continues to outpace loan growth, a trend intact for numerous years now. This reflects a more conservative lending stance by banks and a depressed SA economy.
- Of the big four banks Nedbank and Standard Bank are seeing provisions growing significantly faster than advances, particularly Standard Bank where provisions have risen 39% compared to advances at 5.5% YoY.
- Impaired advances as a % of loans continues to decline from a peak of 5.2% in January 2021 to 5%. This is still significantly higher than pre Covid 19 levels – 4% in January 2020. There is therefore still significant potential for further declines.
Download Report
