JOHANNESBURG – FirstRand, which runs South Africa’s largest retail bank by market share, on Tuesday reported a 6 percent rise in half-year profit in an economic environment it described as “very challenging”.
The lender said its basic and diluted headline earnings per share – the main profit gauge in South Africa – stood at 237.9 cents ($0.1915) in the six months ended Dec. 31, compared with 224.2 cents a year earlier.
The results demonstrated the effectiveness of the bank’s strategy, especially the performances in its largest division – retail bank – were particularly impressive, FirstRand Chief Executive Officer Alan Pullinger said.
“FirstRand produced quality topline growth and a superior ROE despite a very challenging operating environment,” he said.
South Africa’s bleak economy and consumers, who have had to rein in spending and borrowing amid a high unemployment rate, debt levels and other strains on their income, have weighed on banks’ growth potential.
Earnings at FirstRand’s retail division grew 13 percent – a faster rate compared with its peers – while the lender’s corporate and investment bank sector witnessed a 5 percent growth.
The lender’s car finance divisions have struggled with its African unit – WesBank – growing just 1 percent, and earnings dropping at the British unit, MotoNovo.
($1 = 14.3069 rand) (Reuters)