South Africa has experienced a series of nine rate hikes since November 2021, resulting in a total adjustment of 425 basis points, bring them to their highest level in 13 years. This has made financing more expensive for consumers. Major banks in the country, such as Nedbank, FirstRand, Standard Bank, Absa and Capitec, have observed a notable increase in impairment charges, indicating early signs of stress due to higher interest rates and inflation. Nedbank and FirstRand reported 13% increases in credit impairments, while Standard Bank reported a 22% increase. Absa recorded a substantial 61% increase and Capitec noted an astonishing 80% increase amounting to R6.3 billion.
