Sasfin profit up over 100% to R183.9mn
Customer deposits and improved credit performance drove group profits up over 130 per cent for financial services group Sasfin. Sasfin is also reporting a jump in headline earnings per share of just over 20 per cent. Joining CNBC Africa for more is Michael Sassoon, CEO of Sasfin Holdings.
Wed, 21 Sep 2022 16:14:11 GMT
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AI Generated Summary
- Sasfin Holdings reports over 100% increase in profits driven by customer deposits and improved credit performance.
- The company witnessed strong demand for credit post-COVID, focusing on lending to businesses for asset purchases, growth finance, and empowerment financing.
- Sasfin's commitment to inclusive lending practices, climate financing, and prudent risk management positions it for sustainable growth amidst economic uncertainties.
Sasfin Holdings, known as the SME bank, has reported an impressive growth in profits, with a remarkable increase of over 100% to R183.9mn. The financial services group has attributed this growth to customer deposits and improved credit performance. In a recent interview with CNBC Africa, CEO Michael Sassoon shared insights into the company's lending practices and strategies for sustainable growth.
One of the key highlights of Sasfin's performance was the significant growth in loan advancements. Sassoon mentioned that the demand for credit surged as the economy started recovering from the impact of COVID-19 and lockdown restrictions were eased. The company focuses on lending to businesses for various purposes such as asset purchases, growth finance, empowerment financing, and investments in the property sector. Furthermore, Sasfin has partnered with the Dutch development bank, FMO, to provide financing to women, youth, and COVID-impacted businesses, showcasing their commitment to inclusive lending practices.
Despite the challenges posed by the uncertain economic environment, Sasfin maintained a conservative approach to lending. While there was a slight loosening of lending criteria post-COVID, the company remained cautious and closely engaged with clients to assess creditworthiness. This approach helped Sasfin improve its credit performance and ensure that funds were allocated to the right clients for sustainable growth.
In addition to traditional lending, Sasfin has also ventured into new markets, including financing for climate solutions. The company has witnessed a growing demand for energy-efficient asset financing and software investments. Sasfin's focus on supporting businesses in adopting sustainable practices aligns with global efforts towards addressing climate change and promoting ESG principles.
When discussing future growth prospects, Sassoon highlighted the impact of global inflation, high-interest rates, and energy challenges on business investments. While there is hesitancy due to economic volatility, Sasfin remains optimistic about supporting resilient businesses committed to growth. The company aims to navigate through market fluctuations and continue providing financial solutions to meet the evolving needs of its clients.
Sasfin is also actively involved in climate financing, emphasizing the importance of aligning funding with longer-term assets for energy-efficient projects. While challenges exist in terms of payback periods and funding durations, Sasfin is exploring innovative ways to support sustainable investments and contribute to climate change mitigation efforts.
As central banks worldwide consider monetary policy adjustments to address inflationary pressures, Sasfin remains focused on supporting entrepreneurs and small businesses. While higher interest rates may impact credit demand and repayment abilities, Sasfin aims to maintain a balance that benefits both borrowers and savers. The company acknowledges the importance of monetary policies that support entrepreneurship and economic stability while addressing fundamental issues in the economy.
In conclusion, Sasfin Holdings' robust financial performance and sustainable lending practices position the company as a key player in driving economic growth and supporting responsible financial solutions. With a focus on inclusive lending, climate financing, and prudent risk management, Sasfin is well-equipped to navigate challenges and seize opportunities in the evolving financial landscape.