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The 2018 bank results will be the last in the era of "business as usual". Absa and Nedbank’s earnings increased by 3% to R16.1bn and R13.5bn respectively. Standard Bank, more exposed to high-margin African markets, achieved 6% growth to R27.9bn. Even these modest numbers might seem like a stretch into the future as new banks including TymeBank, Bank Zero and Discovery Bank come online. The soft underbelly is transactional income, which is sure to come under pressure from competition. TymeBank, for example, does not charge a fee if clients draw money at one of the tills at a Pick n Pay or Boxer store, and just R2 at other points. Standard Bank alone made R4.3bn from its transactional products, more than from business lines such as home loans, cards or even personal loans. Harry Botha, banking analyst at Avior Capital, says SA banks’ transactional income is vulnerable to fee cuts in the next three years due to competition. If they don’t respond quickly enough then customer losses will...

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