SINGLE-DIGIT GROWTH
Banks unlikely to cash in on ‘Cyril rally’ until late 2018
The renewed investor confidence in the banking sector will probably be rewarded only in the second half of 2018
Domestic banks are expected to manage only single-digit growth in headline earnings in 2018, even as Cyril Ramaphosa’s ascent to the highest office in the ruling party pushed banking shares towards their highest point in recent memory. The "Ramaphosa rally" resulted in the banks index — SA’s gauge of banking shares — peaking at 9,618.67 points four days after Christmas, beating a previous high of 8,495.23 in April. The renewed investor confidence in the banking sector will probably be rewarded only in the second half of 2018, when banks post interim results. "For the 2017 financial year, results to be released in February and March 2018, the sell-side analyst consensus forecasts are expecting only single digit headline earnings per share (HEPS) growth, with the strongest growth forecast for Standard Bank," said Adrian Cloete of PSG Wealth. Growth at Standard Bank is expected in the upper single digits, an improvement on the R14.40 reported in 2017. "Analyst consensus forecasts for 2...
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