Johannesburg - A controversial Viceroy report had no impact on Capitec bank’s financial performance, CEO Gerrie Fourie said on Tuesday, as the lender posted an 18% rise in annual profit.
In January, a bombshell report by the US-based short seller described Capitec as a “loan shark”, plunging the bank’s shares by as much as 25% .
“The Viceroy report came out on January 30 [and] at that stage we were 90% certain where our figures would be,” said Fourie.
“The report had no bearing on the results,” he told Fin24.
The bank, which is targeting the lower segment of the market, has been a dominant player in the industry, offering affordable services and unsecured loans.
The number of active Capitec clients was expected to reach 10 million by the end of the month, making the 18- year-old bank the country’s biggest lender by numbers.
Fourie said although the bank entered the market to service the lower-income population, progress was being made to reach the high-income group.
Part of the bank’s strategy has seen it open branches in more affluent areas, especially in Gauteng, with plans to boost banking services to include secured lending products.
“The only place where we haven’t opened a branch is Sandton, because we are still fighting over rentals,” said Fourie after the release of earnings for the year ended February 28 2018.
“When we opened the bank, we told ourselves that 95% of South Africa should be able to bank with us.”
Capitec reported an 18% jump in headline earnings from R3.8bn in 2017 to R4.5bn, boosted by client growth and fee income, in a weak economic climate that has reduced savings and curbed spending.
The bank's financial results revealed that its credit market shared remained "relatively flat" at 27% of unsecured and short term credit.
“We are optimistic about the political stability and economic potential of the country, and will continue to play our part in enabling and supporting radical economic growth in South Africa the long term,” said Fourie.
* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER