Interim results presentation 2017

Transcription

1 Interim results presentation 2017

2 Contents Key indicators Operating environment What differentiates us Highlights Bank Save Credit Continued focus

3 Key indicators

4 Key indicators Earnings Aug Aug Aug Aug-17 Headline earnings (R'millions) Return on equity (%) 10 Interim Results Presentation 2017 Capitec Bank Limited 4

5 Key indicators Cost-to-income (%) Aug Aug Aug Aug-17 Interim Results Presentation 2017 Capitec Bank Limited 5

6 Key indicators Net transaction fee income to operating expenses (%) Aug Aug Aug Aug-17 Interim Results Presentation 2017 Capitec Bank Limited 6

7 Key indicators Net transaction fee income to net income (%) Aug Aug Aug Aug-17 Interim Results Presentation 2017 Capitec Bank Limited 7

8 Operating environment

9 Operating environment Improving economy Lower inflation Food: 11.3% to 6.8% All items: 5.9% to 4.6% Lower interest rates GDP up to 2.5% from last quarter Stable exchange rate Interim Results Presentation 2017 Capitec Bank Limited 9

10 Operating environment Retrenchments Retrenchments Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb FY2016 FY2017 FY2018 Interim Results Presentation 2017 Capitec Bank Limited 10

11 Operating environment Employment challenges Unemployment rate 27.7% Q2 2017, highest rate observed since September 2003 (STAT SA) Youth unemployment rate 55.9% (STAT SA) Total employed increased ( 000) (STAT SA) April June 2016 April June 2017 Movement (%) Total Employed Formal sector (non-agricultural) Informal sector (non-agricultural) Agriculture, hunting, forestry and fishing Private households Interim Results Presentation 2017 Capitec Bank Limited 11

12 Operating environment Growing account inflows Average account inflows per banking client (same clients tracked over time) (Aug Aug 2017, n = 1.9 million) Sep 16 to Aug 17 % change 6% 6% 11% 16% Interim Results Presentation 2017 Capitec Bank Limited 12

13 Operating environment Cash availability same clients Non-Government (%) Government (%) Total (%) Aug-16 Aug-17 Aug-16 Aug-17 Aug-16 Aug-17 More than 40% cash available Between 39% and 21% cash available Cash stress less than 20% cash available No inflow Interim Results Presentation 2017 Capitec Bank Limited 13

14 Operating environment Global One net loan book clients Total book* Aug-16 (%) Aug-17 (%) More than 40% cash available Between 39% and 21% cash available Cash stress less than 20% cash available 6 6 No inflow % cash available clients per salary band Aug-16 (%) Aug-17 (%) R plus R R R5 001 R R1 R * Clients where we collect their loan instalment from their Global One account Interim Results Presentation 2017 Capitec Bank Limited 14

15 Operating environment Debt review Cost to the client Effect on client Aggressive marketing Interim Results Presentation 2017 Capitec Bank Limited 15

16 What differentiates us We help our clients bank better, so that they can live better. By offering simplified banking that is transparent, easy to access, affordable to use, and delivered through personal service, we put our clients in control.

17 personalised credit interest rates from as low as 12.9% credit card clients pay R35 per month Highlights clients saved over R165 million by banking with their remote app or phone 82% of employees are less than 35 years old 95% clients waited for less than 15 minutes to be served

18 Bank Total Capitec clients as a % of SA population South Africa South Africa Capitec % plus Source: STAT SA- census 2016 and internal data Total Interim Results Presentation 2017 Capitec Bank Limited 18

19 Bank Banking client market share 30% % 20% % 25% % 10% % % 18% % % Jun-13 Jun-14 Jun-15 Jun-16 Jun-17 0 Capitec share of employed population Banking clients Source: Labour Force Survey 2017 Q2, 2016 Q2, 2015 Q2, 2014 Q2, 2013 Q2; Capitec internal data Interim Results Presentation 2017 Capitec Bank Limited 19

20 Bank Client and transaction growth Quality banking clients up 21% Transaction fee income up 29% Cellphone and internet transaction growth up 39% Total number of transactions up 27% 71% of possible transactions done on self-help devices Interim Results Presentation 2017 Capitec Bank Limited 20

21 Bank Transaction growth Transaction volumes ( '000) Channel Aug-16 Aug-17 Growth (%) Cellphone* Point of sale ATM DNR Self service terminals Branch (3) SMS and debit orders * USSD, internet banking and app Interim Results Presentation 2017 Capitec Bank Limited 21

22 Bank Distribution Change since Feb-17 Total Aug-17 Branches Total New look Previous layout (76) 286 ATMs Total Regular Dual note recyclers Partnership Interim Results Presentation 2017 Capitec Bank Limited 22

23 Save Help clients manage their money Brand acceptance and trust Consistent, conservative approach to liquidity Well-priced retail deposit growth fixed and call Interim Results Presentation 2017 Capitec Bank Limited 23

24 Save Deposits (R millions) Aug Aug Aug Aug-17 Retail call Retail fixed Wholesale Interim Results Presentation 2017 Capitec Bank Limited 24

25 Credit Credit market Unsecured and short term credit granted (R 000) Total market Advances Capitec Advances % 27.8% 25.7% 27.1% 26.4% Q1 2015Q4 2016Q1 2016Q4 2017Q1 Source: NCR Interim Results Presentation 2017 Capitec Bank Limited 25

26 Credit Credit market unsecured Rand value by term Quarter 1 Products 2015 (R m) 2016 (R m) 2017 (R m) 0-12 Months Months Months Months Total Source: NCR Interim Results Presentation 2017 Capitec Bank Limited 26

27 Credit Credit market unsecured credit Rand value per income category Quarter 1 Salary band 2015 (R m) 2016 (R m) 2017 (R m) R0 - R R R R R R plus Total Source: NCR Interim Results Presentation 2017 Capitec Bank Limited 27

28 Credit Regulatory Debt relief Credit life insurance Interim Results Presentation 2017 Capitec Bank Limited 28

29 Credit Improved solution Reduced pricing 1.5% interest cut, 6 months term reduction Cut back on small and tiny companies / lower income More personalised credit offer Better interest rate options based on affordability Interim Results Presentation 2017 Capitec Bank Limited 29

30 Credit Loans advanced by term Interim Results Presentation 2017 Capitec Bank Limited 30

31 Credit Application 6 months ended Aug-16 (%) Feb-17 (%) Aug-17 (%) Applications Decline Rate Application Approved: Not Taken up Applications Taken Up Rate Total Interim Results Presentation 2017 Capitec Bank Limited 31

32 Credit Collections/provisions Arrears & impairment provisions of gross loans & advances Aug-16 Feb-17 Aug-17 Gross loans and advances R'm Loans past due (arrears) R'm Arrears to gross loans and advances % 6,0 6,3 5,4 Arrears rescheduled within 6 months R'm Arrears and arrears rescheduled within 6 months to gross loans and advances % 9,8 9,8 8,4 Rescheduled from up-to-date within 6 months R'm Arrears and all rescheduled within 6 months to gross loans and advances % 13,4 12,2 10,6 Provision for doubtful debts R'm Provision for doubtful debts to gross loans and advances % 13,7 13,1 12,7 Arrears coverage ratio % Arrears and arrears rescheduled within 6 months coverage ratio % Arrears and all rescheduled within 6 months coverage ratio % Interim Results Presentation 2017 Capitec Bank Limited 32

33 Credit Credit card Consistent growth in clients Overseas travel Adjusted pricing Interim Results Presentation 2017 Capitec Bank Limited 33

34 Continued focus

35 Continued focus Cream Finance Improved service People development and leadership Business delivery and throughput Growing quality clients Developing digital banking platform Interim Results Presentation 2017 Capitec Bank Limited 35

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