Capitec's profits now far exceed pre-Covid levels, as bank adds 190 000 new clients a month

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Capitec's customer base increased to 18.1 million by the end of February 2022.
The bank added almost 190 000 new customers a month on average in the past financial year.
Capitec's customer base increased to 18.1 million by the end of February 2022. The bank added almost 190 000 new customers a month on average in the past financial year.
  • Capitec's customer base increased to 18.1 million by the end of February 2022.
  • The bank added almost 190 000 new customers a month on average in the past financial year.
  • Its headline profit soared 84% to R8.4 billion in the year to end-February. 

Capitec's profits for 2022 have far surpassed what the bank reported in the two years preceding the Covid-19 pandemic, thanks partly to the bank gaining almost 190 000 new clients every month.

Its headline profit soared 84% to R8.4 billion in the year to end-February. This was far higher than the R6.28 billion Capitec reported at the end of February 2020, just before the Covid-19 pandemic turned the world and the financial markets upside down.

In the 2019 financial year, Capitec delivered a profit of R5.29 billion. Its profits have been growing by 17% a year (compound annual growth) over the past five years, and by 23% a year since 2012.

Capitec, which is now South Africa's largest bank measured in customer numbers and has the second-largest market capitalisation, published its annual financial statements for the year ended on 28 February on Tuesday morning.

Its active client base grew by 14% to 18.1 million during the past year, translating to nearly 190 000 new clients per month. A year earlier, Capitec had 15.8 million active clients - meaning that it added 2.3 million more in the 2022 financial year.

Five years ago, the bank only had 8.6 million customers. Its customer growth rate has remained impressive even as new challenger banks have entered the market.

For instance, in the 2021 financial year, the bank added 1.9 million new active customers. In 2020, it added 2.5 million, growing its customer base from 11.4 million on 28 February 2019 to 13.9 million a year later.

READ | Capitec is fast outgrowing its older siblings, and it's coming for high earners next

Its business banking division, previously known as Mercantile Bank, also reported a 10% increase in its client base to 125 270 and contributed R174.5 million to the group's earnings.

As its client base grows, Capitec's net transaction income is increasing by high double digits. In the year to end-February, income from the retail banking operations increased by 21% to R9.8 billion. Over the past five years, its transaction income has increased by almost R6 billion.

When including the business bank, Capitec's net transaction income grew to R10.5 billion.

But interest income from loans was negatively affected by lower interest rates that were offered, and clients’ migration to its revolving credit access facility. Interest income fell by 1% to R13.2 billion.

The bank's insurance business is growing rapidly. Capitec's net insurance income from credit life policies grew 60% to R1.5 billion. Funeral plan income increased by 39% to almost R1 billion as Capitec grew active funeral policies to 1.7 million.

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