Banking

Richest banks in South Africa

Staff Writer

 ·29 Jun 2015

South Africa’s banks continue to dominate Africa’s banking sector, despite challenges acting against the local currency.

This is according to the 2015 rankings from The Banker’s Top 1000 World Banks list.

Standard Bank remains South Africa’s – and the continent’s – largest bank, though it has dropped from 116th to 123rd in the overall ranking.

The group’s Tier 1 capital has fallen from $10.56 billion to $10.18 billion, The Banker said.

“For South Africa’s banking sector, the largest in Africa, 2014 passed in a similar vein to 2013 – both years were dominated by the weak performance of the national economy and the ensuing volatility of the rand,” the publication said.

“In 2013, the rand lost 13% of its value against the dollar, and though 2014 did not see another rapid depreciation, rand volatility remained high.”

“This hampered the ability of South Africa’s banks to improve their capital adequacy. Four out of its top five lenders have fallen in the Top 1000 World Banks 2015 ranking, with a sixth, African Bank, dropping out of the table entirely.”

FirstRand has held its regional ranking position at second place in the country and on the continent, and marginally increased its capital to $7.98 billion.

Nedbank has dropped from 195th position to 216th and has seen its capital base drop to $4.76 billion, from $5.11 billion. The bank is ranked third.

Barclays Africa Group, previously known as Absa Group, would have come third in the African rankings with a Tier 1 capital base of $6.09bn, but is excluded from the main ranking as it is a subsidiary of the UK’s Barclays.

Notably, Absa is listed as the 13th best bank in the world in terms of making profits for its parent company.

The group reported pre-tax profits of $1.7 billion in 2014.

South Africa’s other top banks that made the top 25 list in Africa (and the Top 1000 list, globally) are Investec, ranked 8th on the continent and 357th overall, and Capitec, ranked 19th and 672nd.

Including Barclays Africa (Absa), these are the top banks in South Africa:

Looking at the global data, the Asia-Pacific region remains in control of the largest share of global profits, though it has decreased from 51.07% to 50.81%.

Africa has increased its share (1.63% to 1.88%), although with the smallest portion.

The continent has excelled in terms of aggregate profitability, where a 2.14% return on assets leads all other regions.

Africa and Asia-Pacific (1.15%) were the only regions to offer a ROA above the Top 1000 average of 0.88%.

Asian banks dominated the top bank ranking, with Chinese banks taking the first two spots, and seeing significant climbs.

US banks tied with China to have four banks listed in the top 10, while the UK and Japan also made the cut.

These are the top 10 banks in the world, according to The Banker.

The Banker’s Top 1000 World Banks ranking tracks the largest bank holding companies based on Tier 1 capital.

Tier 1 capital is the core measure of a bank’s financial strength, composed of core capital, which consists primarily of common stock and disclosed reserves.

In the 2015 rankings, the group took the disclosed Tier 1 capital for banks that have adopted the Basel III regulatory framework.

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