Year-end results from banking group FirstRand last week provided a sobering counter to any undue optimism that might have followed the news that the economy had emerged from recession. It’s not that there was anything wrong with the banking group’s results, which, in its own words, reflected "a resilient performance in a difficult economy". It grew revenue in a period in which some of its rivals did not and the group is so strongly capitalised that it was able to pay back some of the surplus capital to its shareholders, increasing its dividend payout 13% on diluted earnings, which were up 7%. However, FirstRand’s leadership made clear the dim view they have of the economic cycle from here out, emphasising the need for its cautious approach to lending and highlighting the risks that face the economy and banking sector. "We will not chase growth at the expense of returns," said CEO Johan Burger. And while he talked of the group’s investment in new growth initiatives, this came with a ...

Subscribe now to unlock this article.

Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).

There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.

Cancel anytime.

Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.