The return to profitability for the Group for the year was largely attributable to upfront higher credit impairments raised a year ago being sufficient to account for the increased risk of default, strong collections and increased profits in the insurance entity.
Commenting on the performance of the business, CEO, Kennedy Bungane notes: “The financial year has been a story of two halves at African Bank, with the first six months being about business resilience as we emerged from harsh effects of the first three waves of Covid –19.
“The second half of the financial year was about transitioning the business to our new 2025 Excelerate strategy, while instituting necessary risk aversion measures ahead of a 4th wave of Covid-19, which is now unfolding.”
During the year under review, the board signed off on a new 2025 strategy for the Group such that the business remains a sustainable and investible market proposition.
The heart of the strategy articulates a two-pronged approach which is to expand the core growth initiatives such as providing a digital offering to small, medium and micro enterprises, to grow the customer base and diversify the product offering while strengthening digital interventions and capabilities.
The new strategy is developed on the foundation of five sustainability levers, which is to permeate across all business and functional activities and have measurable targets to be achieved by the end of FY25. They include customer satisfaction, social responsibility, financial resilience, inclusivity and environmental promotion.
“As the vaccine rollout continues to progress in South Africa and around the world, and despite subsequent waves of the pandemic, and indeed last weeks’ news on the new Omnicron variant of Covid, we are confident that opportunities will exist for African Bank and for our customers.
“During this period of uncertainty, it has become clear to us that our strategy and operating model must remain adaptive and nimble, particularly in relation to the needs of our customer base, our product and service offering and our capacity to manage future disruption risks to our people, processes and services.
“These ongoing adaptions will assist to cement a future-fit organisation,” says Bungane.
Result highlights