On Tuesday, November 26, a bank which was only founded in April 2016 let the whole world in on its latest financials.
Among the many impressive figures recorded in the financial report, perhaps the toast of them all was that the South Africa-headquartered bank is adding 25,000 new bank accounts every month.
That bank is known as African Bank and the financial institution recorded an operating profit of ZAR 1.6 Bn (USD 108 Mn) for the year ended September 2019, up 11 percent from the previous year.
South Africa-based African Bank Limited is a retail bank that offers financial products and services. The Bank is licensed as a “locally-controlled bank” by the South African Reserve Bank.
African Bank says it is signing up 25,000 users to its MyWORLD retail banking account each month.
MyWORLD is African Bank’s zero monthly fee transactional banking product which was launched to customers in May 2019. MyWORLD comes with absolutely no charges. The bank doesn’t charge any fees for all the perks that the account, which is similar to the regular bank accounts which many banks charge various kinds of fees for.
And this is probably why it has been significantly adopted since it was launched.
African Bank says the MyWORLD banking product has since attracted 100,000 new accounts – and 50 percent of account holders are new bank customers.
South African business media, BusinessTech, gathered that the bank is targeting growth of 200 percent into 2020, with 25,000 new accounts being signed each month. It said that it will also ramp up new product offerings.
As reported in the financials, the bank’s net profit-after-tax for the year shot up 13 percent to ZAR 1.15 Bn (USD 77.6 Mn).
African Bank attributes this to improvements in the banks’ loan book and the collection of outstanding balances, an improvement in the insurance results, and a more efficient balance sheet also had a positive effect.
The bank also claimed that ROE increased from 10.6 percent to 11.1 percent, while retail deposits increased by 115 percent to ZAR 2.4 Bn (162.1 Mn).
New loan and credit card business, written for the year under review, was ZAR 10.8 Bn (USD 729.6 Bn) – representing an increase of 12 percent year-on-year, with the direct sales channel contributing ZAR 1.7 Bn (114.8 Mn), and the new web channel weighing in with ZAR 451 Mn (USD 30.4 Mn). Together, direct sales and the web channel contribute 20 percent of sales, compared to 6 percent in 2018.
The lender said that the number of retail savings and investments depositors increased to 26,000 from 15,000, while the average deposit has increased to ZAR 88 K (USD 5.9 K) from ZAR 72 K (USD 5.2 K) over the same period.
“The group delivered a pleasing set of results, reporting a third successive year of increasing profits,” said African Bank’s CEO, Basani Maluleke.
“We have made good progress in achieving our strategic objectives. One of the Bank’s most important strategic objective is the diversification of its product offering. We proudly launched our transactional product, MyWORLD, on our new Omni-channel in May this year.”
He added: “MyWORLD will significantly accelerate our efforts to diversify our revenue streams and broaden our customer base, while aiding our efforts to better understand our customers, attract additional retail deposits and grow our digital capabilities.”
African Bank claims it continues to operate with robust levels of capital and liquidity. The CEO also said that the bank will continue to invest in and develop its direct sales and digital channels.
Featured Image Courtesy: mg.co.za