Sasfin sees more than 20% drop in earnings as impairments increase
The company expects a fall in loans and advances which will result in lower than expected income for the full year period
Financial and banking services company Sasfin said on Monday that its earnings are likely to drop by more than 20% in the year to end-June largely due to an expected increase in impairments.
“Many of the South African businesses, where Sasfin focuses its lending activities, have been significantly impacted by Covid-19. This has resulted in lower lending volumes, a lower demand for credit, and an increase in impairments,” Sasfin said in a statement.
Sasfin said it expects headline earnings per share and earnings per share to be more than 20% lower from 501c and 459.86c respectively in the prior comparable period.
“We have seen a significant increase in impairments since our half year results,” Sasfin said.
The company said because the IFRS9 accounting standard requires lenders to adopt a forward-looking view of the quality of their loans, Sasfin could see more impairments in June.
The company said it expects a reduction in loans and advances which will result in lower than expected income for the period.
At 4.52pm, its share price climbed 10.41% to R17.50.
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