PwC: Major SA Banks Show Resilience Despite Global and Local Challenges
PwC's press release mentioned that South Africa’s major banks maintained a steady growth path in 2024 amidst a challenging operating climate and significant macro and geopolitical related uncertainty.
PwC has released its Major banks analysis – March 2025. PwC’s Major Banks Analysis highlights key themes from the combined local currency results of Absa, FirstRand, Nedbank and Standard Bank, and provides reflections from the common strategic themes within other South African banks.
PwC’s press release mentioned that South Africa’s major banks maintained a steady growth path in 2024 amidst a challenging operating climate and significant macro and geopolitical related uncertainty. It further reported that the combined headline earnings growth of 5.9% against FY23 to R119bn, combined ROE of 17.5% (FY23: 17.6%), net interest margin of 451 bps (FY23: 459 bps), credit loss ratio of 89 bps (FY23: 102 bps), cost-to-income ratio of 52.9% (FY23: 52.4%), common equity tier ratio of 13.3% (FY23: 13.2%)
The year 2024 was a turbulent period for global and regional economies, marked by heightened uncertainty, geopolitical tensions and shifting trade dynamics. Nearly half the world’s population participated in elections, creating a ripple effect of political and economic unpredictability. Global inflation moderated but remained high in many emerging markets, delaying anticipated interest rate cuts, placing strain on fiscal positions in several developing economies and complicating economic recovery efforts. In sub-Saharan Africa, the combined impact of persistent socio-economic challenges, adverse weather patterns, volatile commodity prices and fiscal challenges continued to strain economies, while currency volatility and inflationary pressures persisted.
– Excerpt from PwC’s Press Release
The press release stated that South Africa, however, saw some positive developments. Steps towards structural reforms, particularly in energy supply and logistics, began to yield results, while the formation of a Government of National Unity was met with cautious optimism by markets. These factors contributed to a stronger rand and relatively improved investor sentiment. Despite these improvements, the South African economy faced headwinds, with high unemployment levels and subdued real GDP growth of 0.6% in 2024.
Against this backdrop, South Africa’s major banks continued to demonstrate their resilience, navigating these and other complex conditions with strategic agility.
2024 has been another testament to the strength and adaptability of South Africa’s banking sector. Despite continuing and evolving challenges in the global, regional and domestic operating environment, the major banks’ management teams remained focused on delivering value to customers, managing risks and investing in future growth opportunities.
