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Capitec’s profits are now well above pre-Covid levels, as the bank adds 190,000 new clients a month

Capitec’s customer base increased to 18.1 million at the end of February 2022. In the past financial year, the bank added an average of almost 190,000 new customers per month.

  • Capitec’s customer base increased to 18.1 million at the end of February 2022.
  • The bank added an average of nearly 190,000 new customers a month in the past fiscal year.
  • His header wins soared 84% to R8.4 billion in the year to end-February.

CapitecThe profits of 2022 far exceed what the bank reported in the two years leading up to the Covid-19 pandemic, thanks in part to the bank receiving nearly 190,000 new clients each month.

The head profit in the year to the end of February went up by 84% to R8.4 billion. This was much higher than the R6.28 billion Capitec reported at the end of February 2020, just before the Covid-19 pandemic turned the world and financial markets upside down.

In the fiscal year 2019, Capitec delivered a profit of R5.29 billion. Profits have grown by 17% a year over the past five years (compound annual growth) and by 23% a year since 2012.

Capitec, which is now South Africa’s largest bank in terms of customer numbers and has the second largest market capitalization, published its annual financial reports for the year ending 28 February on Tuesday morning.

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

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

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

READ | Capitec is growing rapidly from its older siblings, and it comes next for high earnings

Its corporate banking division, formerly known as Mercantile Bank, also reported a 10% increase in its customer base to 125,270 and contributed R174.5 million to the group’s revenue.

As its customer base grows, Capitec’s net transaction revenue increases with high double digits. In the year to the end of February, revenue from retail banking operations increased by 21% to R9.8 billion. Over the past five years, its transaction revenue has increased by almost R6 billion.

Upon the acquisition of the commercial bank, Capitec’s net transaction revenue grew to R10.5 billion.

But interest income from loans was negatively impacted by lower interest rates being 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 fast. Capitec’s net insurance revenue from credit life policies grew 60% to R1.5 billion. Funeral planning revenue increased by 39% to nearly R1 billion as Capitec’s active funeral policy grew to 1.7 million.

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Capitec’s profits are now well above pre-Covid levels, as the bank adds 190,000 new clients a month

Source link Capitec’s profits are now well above pre-Covid levels, as the bank adds 190,000 new clients a month

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