Capitec reported a 9% increase in headline earnings for the first half of 2023, despite challenging economic conditions that have put pressure on consumers and businesses. The bank’s net credit impairment charge grew by 62%, primarily due to an increase in the migration of balances into stages 2 and 3 of the retail loan book. However, Capitec noted that its mitigation strategies are reducing the number of clients moving into these stages, and it sees signs of improvement. The performance was driven by its constant investment in innovation and an increase of 11% in the number of active clients which led to an 18% increase in retail transaction volumes. The bank now serves 21 million customers or a third of the country’s population. Net interest income grew, driven by a 275 basis points increase in the repo rate since August 2022. Net insurance income increased by 33%, particularly from funeral which grew 59% and credit life insurance which grew 20%.
