Last month Bidvest Bank was launched officially in South Africa, the latest project of diversified industrial giant Bidvest. Brian Joffe’s company appears to have taken the view that there’s nowhere to go but up, although Bidvest is taking a conservative approach.
Joffe founded his empire 18 years ago with one acquisition, Chipkins, a catering services company. Frozen food business Seaworld quickly followed and, since then, there has been no stopping Joffe. Cleaning services, freighting, stationery and the McCarthy car dealership group followed. These days the group has nearly 100 000 employees and almost R90-billion in annual revenue, with operations on four continents.
Given that Bidvest appears to have invested in just about everything else, perhaps financial services was the logical next step, after all.
In fact Bidvest Bank has been around for a while. Previously it was known as Rennies Bank. It has a banking licence dating back to 2000.
“We changed the name because the market never perceived Rennies as a bank, which it was,” said Alan Salomon, managing director of the bank, who emphasised that it was targeting slow, organic growth, rather than an aggressive strategy to gain market share.
The group said it wanted its bank to expand into general commercial banking services. It added that as South Africans’ propensity to save had been declining and there were attempts to foster a savings culture, it indicated that new savings products were needed and Bidvest Bank would concentrate initially on savings offerings.
“The economic cake is getting bigger and there’s more available for everyone,” said spokesperson Maggie Anderson. “Our core strength is retail foreign exchange and that will continue to be a strong focus.”
Bidvest Bank, despite its success with foreign exchange, hopes to lure customers with a debit card, linked to Visa’s Electron system, and a range of savings products. It offers loans to corporations, corporate credit cards, trade services, fixed deposits and call accounts, although there is no cheque account product yet.
The bank is hoping attractive interest rates will lure customers, according to Anderson. It offers rates of between 6% and 8% on call deposits above R5 000 and about 7% on notice deposits. For amounts below R5 000 it offers 3%. Interest rates on fixed deposits vary between 8,75% and 10,15%.
There are 60 branches, mainly at airports and in shopping centres in tourist hot spots, such as Cape Town’s Waterfront and Rosebank and Sandton in Johannesburg.
The bank is not rated yet on comparative banking site Thinkmoney.co.za. But a quick look at the site shows that, although Bidvest’s offerings would appear to compete with the established big banks, it is outdone by Capitec and Go Banking.
Capitec’s Global One Gold account offers 10% interest on daily balances up to R10 000. Go Banking offers between 4,5% on amounts below R5 000 and 8,5% on amounts above R500 000.