While there have been some disturbing trading updates from retailers, the major banking groups have kept silent. Neelash Hansjee, manager of the Old Mutual Financial Services Fund, says bank earnings will cluster at growth of about 3%-7% in the year to December. And Capitec, with a February year-end, is expected to repeat its 20% growth in the first half. A high part of Capitec’s income still comes from personal loans. The bank is more affected than the rest of the sector by International Financial Reporting Standards (IFRS) 9, which measures nonperforming loans more strictly than before. But IFRS 9 could also shave one or two percentage points off any of the universal banks’ earnings growth. Hansjee says that Capitec has several levers of growth other than unsecured loans. The sales numbers reported from its funeral policy joint venture with Sanlam look impressive and there is plenty of runway for its Global One credit card. And as the buyer of Mercantile it has avoided the long an...

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