Absa Group, the South African bank majority owned by Britain’s Barclays, reported flat full-year earnings that were slightly above consensus, hit by slack demand for loans and a slow economic recovery.
South Africa’s biggest retail lender said diluted headline earnings per share totalled 1 115,72 cents in the year to end-December, compared with 1 072 cents a year earlier.
That was above the average estimate of 1 109,72 in a poll of 12 analysts by Thomson Reuters.
Headline EPS, which excludes certain one-time items, is the main gauge of profit in South Africa. Diluted earnings take into account the impact of stock options on EPS.
Net interest income, the measure of a bank’s earnings from lending, totalled R23,34-billion compared with R21,85-billion a year earlier.
Absa is the first of South Africa’s four largest banks to report earnings in what analysts expect to be a lacklustre results season.
Banks in Africa’s largest economy have been hamstrung in the aftermath of a 2009 recession that cut about a million jobs and eroded loan demand from both retail and corporate customers.
The central bank has responded by cutting rates to their lowest in years, putting further pressure on lending margins. — Reuters
