{"id":427986,"date":"2020-08-24T08:21:36","date_gmt":"2020-08-24T06:21:36","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=427986"},"modified":"2020-08-24T08:21:36","modified_gmt":"2020-08-24T06:21:36","slug":"absa-says-south-africans-are-struggling-to-repay-debt","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/banking\/427986\/absa-says-south-africans-are-struggling-to-repay-debt\/","title":{"rendered":"Absa says South Africans are struggling to repay debt"},"content":{"rendered":"<p>Absa Group on Monday (24 August), reported an 82% decline in normalised interim earnings after impairments increased four-fold to R14.7 billion.<\/p>\n<p>&#8220;Impairment charges rose as customers and clients struggled to repay debt and as the Group took decisive action to increase impairment provisions against future potential credit losses,&#8221; the bank said in a statement.<\/p>\n<p>Despite significantly higher credit impairments and the material impact of the lockdowns on transactional volumes, Absa said all business units remained profitable.<\/p>\n<p>&#8220;The group expects a continued difficult environment for the consumer and heightened uncertainty is expected to dampen business confidence and investment in the remainder of 2020.&#8221;<\/p>\n<p>\u201cIn the current economic climate, ensuring continued operational and financial resilience is paramount. We are therefore temporarily holding our growth ambitions in abeyance to focus on cost management and capital and liquidity preservation, while continuing to support customers,\u201d said Daniel Mminele, Absa Group chief executive.<\/p>\n<p>Headline earnings per ordinary share declined 82% to 173.6 cents per share. Cost-to-income ratio declined to 53.9%, from 56.7%.<\/p>\n<p>The group did not declare a dividend, following a dividend declaration of 505 cents previously.<\/p>\n<p>\u201cOur revenue remained resilient and our operating costs were well managed and responded to the crisis, resulting in encouraging pre-provision profit growth of 9%,\u201d said Absa Group financial director Jason Quinn. \u201cOur capital and liquidity levels are strong and will allow us to further support our customers as we emerge from the crisis,\u201d he said.<\/p>\n<p><strong>Retail and Business Banking South Africa (RBB SA)<\/strong><\/p>\n<p>Despite the macroeconomic challenges presented by Covid-19, Absa said its RBB performance remained resilient compared to the market in a number of areas:<\/p>\n<ul>\n<li>Home loans registrations were down 31% while the market contracted by 39%;<\/li>\n<li>Vehicle and asset financing decreased 19% in a market that shrunk by 42%;<\/li>\n<li>Retail deposits grew 12%, in line with the market.<\/li>\n<\/ul>\n<p>Digitally active customers grew by 12% in the period since December 2019, the lender said.<\/p>\n<p>&#8220;While uncertainty remains high, the Group is well-positioned with a strong capital and liquidity position allowing it to continue to support its customers. With the decisive actions that have been taken in the first half to improve balance sheet resilience, the group expects the second-half impairment outcome and returns to improve,&#8221; it said.<\/p>\n<p><a  data-lightbox=\"post-image\" href=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2020\/08\/Absa-1.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-427992\" src=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2020\/08\/Absa-1.png\" alt=\"\" width=\"714\" height=\"380\" srcset=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2020\/08\/Absa-1.png 714w, https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2020\/08\/Absa-1-300x160.png 300w\" sizes=\"auto, (max-width: 714px) 100vw, 714px\" \/><\/a><\/p>\n<hr \/>\n<p><strong>Read: <a href=\"https:\/\/businesstech.co.za\/news\/banking\/420902\/standard-bank-shares-rise-after-profit-slumps-less-than-expected\/\" target=\"_blank\" rel=\"noopener noreferrer\">Standard Bank gains after profit slumps less than expected<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Absa Group on Monday (24 August), reported an 82% decline in normalised interim earnings after impairments increased four-fold to R14.7 billion.<\/p>\n","protected":false},"author":10,"featured_media":258063,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[961],"tags":[29,26],"class_list":["post-427986","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banking","tag-absa","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/427986","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=427986"}],"version-history":[{"count":5,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/427986\/revisions"}],"predecessor-version":[{"id":428012,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/427986\/revisions\/428012"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/258063"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=427986"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=427986"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=427986"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}