Sasfin records ‘disappointing’ drop in interim headline earnings
JSE-listed Sasfin bank on Tuesday reported what it termed a disappointing drop in headline earnings of 41.39% to R50.491 million for the six months ended December 2017.
Headline earnings per share dropped by 41.81% to 157.95 cents (December 2016: 271.42 cents). “This arose primarily from a large credit event related to a single client, a change in the accounting estimate of certain deferred tax assets and a change in the group’s estimate of a deferred tax liability,” it said.
Sasfin noted that the economic and political environment was particularly difficult over the six months to December 2017 in the build up to the ANC National Elective Conference.
“South African businesses and investors had to deal with increasing pressures given the ratings downgrades, the state of the economy, public and private sector corruption, as well as challenges within our state-owned enterprises.
“Furthermore, the banking and financial services industry in South Africa is navigating new banking and disruptive entrants, how to effect meaningful and sustainable transformation, and a changing regulatory landscape,” Sasfin said.
Despite positive income growth in Sasfin Wealth and the growth in net interest income, total income declined by 2.48% due to a decrease in non-interest revenue primarily due to lower income levels in Sasfin Capital.
The group said it continues to focus on cost management. On the back of these initiatives, costs decreased by 7.53% to R407.687 million.
Total assets grew by 13.78% to R13.152 billion with gross loans and advances growing by 7.09%.
The group grew its funding base by 12.67% to R9.192 billion with growth in client deposits to R4.246 billion and debt securities to R3.113 billion, resulting in a liquidity position of R3.717 billion.
Approximately R1 billion is earmarked for the acquisition of the Absa Technology Finance Solutions (ATFS) business which will be effective 1 April 2018, Sasfin said.
The group declared a dividend of 46.89 cents per share, versus 80.00 cents per share in 2016.
Read: Sasfin results disappoint, as full year earnings drop 16%
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