FNB reveals strong growth in value-added services and digital platforms

 ·3 Mar 2022

FNB says it has delivered robust interim results for the six months ended December 2021 with pre-tax profits increasing 31% to R13.8 billion, and an improved Return on Equity (ROE) of 39.7%.

Operational performance was bolstered by a macroeconomic recovery, deposit growth, and an improved credit performance, coupled with continued platform innovation, it said.

While there was muted growth in advances, deposit growth remained strong with retail and commercial segments benefiting from active customer base growth of 3% and 5%, respectively.

FNB said it increased its customer numbers to a combined total of 10.69 million, comprising 8.82 million customers in South Africa and 1.87 million customers in the Rest of Africa.

The lender said it is the country’s leading digital bank with 69% of retail customers and 79% of commercial customers engaging on digital channels, driving overall digital volumes up 13%. Total transactional volumes grew 12% lifting NIR despite some material fee “give backs” as new customer value propositions were introduced.

The group said that eWallet users increased by 6% to 5.95 million, while ongoing investment in its digital platform continues to yield results, with digitally active customers increasing to 6.21 million and logins totalling 804 million for the period. A new record of 89.5 million logins on the App was recorded in the month of December 2021, it said.

Key highlights in FNB’s operational performance include:

  • SA pre-tax profits up 28%
  • Rest of Africa pre-tax profits up 64%
  • Total platform users up 4%
  • Return on Equity (ROE) improved to 39.7%
  • Deposits up 9%
  • Wealth and Investments account base up 12%
  • App transacting base exceeds 4.4 million

Jacques Celliers, FNB CEO, said: “Our interim results demonstrate our ability to help and remain relevant to our retail and commercial customers in every economic context. Our investment in platform innovation puts us in a better position to assist customers across transactional activities, payments, investments, credit, insurance, telecommunications and value-added services such as rewards and lifestyle (nav»).

“As the country and our customers transition from the past two years of Covid-19 impacts, we expect more opportunities to deliver value to our customers through integrated financial services on our trusted digital platform.”

FNB continues to scale its investment activities as Wealth and Investment Management grew its customer base by 12% with assets under management increasing by 17%. The FNB Horizon Series unit trusts recorded good growth of 42%, with more innovative value propositions such as Retirement Annuity, Exchange Traded Notes, and Shares Zero available on the FNB App.

Platform innovation

FNB said it continues to expand its value to customers with innovative solutions and value-added services. Among these is the Virtual Card on the App, which has seen 1.2 million virtual cards activated with over R2.4 billion in spend values since its launch.

The bank said it is also scaling its growth in device payments, with customers performing 9.7 million transactions worth R3.4 billion in value, during the six months to December 2021. nav»Money, a money management tool to track spend and credit status, has seen a 56% increase in usage to reach 2.5 million users, while nav»Home has paid out R33.4 billion to place families in homes since inception.

The nav»Car digital garage has loaded 729,000 vehicles and 108,000 vehicle licences were delivered. Third-party electricity, mobile and digital vouchers that are facilitated by FNB Connect on its digital platform increased by 3% to R9.1 billion and FNB Connect provided customers with 3.96 billion megabytes (MB) of data over the six months to December 2021.


FirstRand, the financial services group comprising FNB, RMB, WesBank and Aldermore in the UK, announced results for the six months ended December 2021, showing that normalised earnings increased 43%, with most of this growth ascribed to the prior year base effect, which included increased impairments raised during the Covid-19 pandemic.

It said that operational performance is captured in the 6% growth in pre-provision operating profits, which excludes impairments, and the strong rebound in economic profit to R4.6 billion.

FirstRand CEO, Alan Pullinger, said: “This is a respectable performance from FirstRand. Economic profit has rebounded strongly, and pre-provision operating profit growth was robust. The group’s balance sheet strength is demonstrated in the healthy capital and liquidity levels, and conservative provisions have been maintained.

RMB’s profit before tax increased 15% to R5.2 billion, driven by improved contributions from investment banking and corporate transactional banking, mainly on the back of lower impairments. RMB’s ROE improved to 20.1%.

WesBank’s profits before tax increased 16% to R1.1 billion, driven by lower impairments, lifting the ROE to 20.2%. WesBank is tackling a tough market characterised by highly competitive pricing, whilst the business is focused on lending to better-quality customers, said FirstRand.

The group’s portfolio of businesses in the rest of Africa have recovered strongly with pre-provision profits growing 18% and the portfolio ROE improving to 16.4%. Customer acquisition continued and deposit growth was healthy, it said.

Looking forward, retail and wholesale demand for credit is expected to continue to lift. There are promising signs of increased investment spending by South African corporates which is crucial to the long-term growth agenda for the country, FirstRand said.

“Notwithstanding the indefensible invasion taking place in Ukraine, which will add uncertainty to the global post-pandemic recovery, the group will effectively navigate the associated macroeconomic challenges that may arise,” said Pullinger.

Read: FirstRand gets approval to acquire SLOW lounges from Kulula

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