Capitec full-year earnings reveal slow growth
Shares of Capitec are down about 7 percent over the last 12 months.
JOHANNESBURG - South African mass-market lender Capitec Bank Holdings reported a sharp slowdown in full-year profit growth on Wednesday, with earnings rising 16 percent on widening bad-loan costs.
Capitec, which offers high-interest loans to low-income South Africans, has enjoyed years of explosive growth due to ravenous demand for credit in Africa's largest economy.
But lacklustre economic growth and high unemployment have hit debt-burdened South Africans hard, hammering some of Capitec's mass-market rivals, including African Bank Investments.
"This year has seen deterioration in the quality of our loan book," Capitec said in a statement.
Diluted headline earnings totalled 1,740 cents in the year to end-February, from 1,498 cents a year earlier, when Capitec enjoyed 36 percent profit growth.
Net interest income - the measure of earnings from lending - increased by about a third, as did bad loan costs.
Shares of Capitec are down about 7 percent over the last 12 months, underperforming an 18 percent increase in Johannesburg's broad All-Share index.