FNB contactless cards in issue up 1 400 %

By Hilary Mare

FIRSTRAND Namibia chief financial officer, Oscar Capelao has said that one of the positive highlights of the past year for the bank is the fact that it now has more than 280 000 contactless cards in issue which is an increase of 1 400 percent from the previous year.

Capelao said this last week while presenting the bank’s interim results for the six months ending December 31 2020.

“This means our customers are embracing new technology, and minimising physical contact at tills – especially during the Covid-19 pandemic – has thus been successfully circumvented. Contactless payments mean shoppers avoid having to touch card readers and minimises queuing time and we are grateful that this product and service offer has been a winner with our customers,” Capelao said adding that in an unprecedented year, the bank’s deep commitment to its brand promise remained steadfast.

“The pandemic necessitated a deliberate response of help – and as a business we took active action in providing an enabling environment for our customers, our employees and the communities in which we operate. We are driven by a purpose to be a force of good and, no matter the circumstances; we will continue to navigate a future of shared prosperity. Financial inclusion, sound money management, youth employment creation and public-private partnerships are all important themes in our strategy to provide holistic help,” he said.

In its key financial highlights FirstRand delivered earnings of N$564.9 million for the period ended December 31 2020. In terms of revenue, period-on-period (December 2019 to December 2020) net interest income (NII) decreased by 14 percent whilst non-interest revenue (NIR) was up marginally.

Retail and commercial deposits grew with 16.3 percent, with large corporate deposits increasing 20.2 percent. On the other hand total financial transactions went up 6.3 percent, banking app transactions up 112.0 percent, point-of-sale swipes (merchant acquiring) up 11.2 percent and in branch transactions are down 6.3 percent.

Capelao also said that group operating costs have decreased by 4.6 percent to N$1,014 million (2019: N$1,063 million) adding that this is reflected in the Bank’s cost to income ratio of 51.1 percent (2019: 50.9 percent).

The group’s total assets increased by 2.2 percent to N$44.8 billion (2019: N$43.8 billion). Net advances making up 67.7 percent (2019: 71.8 percent) of the balance sheet, reflected a year on year decrease of (3.7 percent) to N$30.3 billion. Advances growth in FNB occurred mainly in the Retail at 2.8 percent, with the Commercial segment sharply down at minus 13 percent.

Results also show that at WesBank, the 6.0 percent decline in advances reflects the material drop in applications during the period in the Namibian retail vehicle asset finance (VAF) business, where new business contracted 26.7 percent for the calendar year 2020. Card advances declined by 2.3 percent, year on year, reflecting reduced risk appetite given risk cuts, together with significant lower spending during the lockdown period.

Further, personal loans grew by 3.3 percent, reflecting risk cuts on the weaker macro environment pre-pandemic and the impact of the pandemic on customers while RMB corporate and investment banking (CIB) advances growth was 1 percent. Deposit growth was ahead of advances, growing by 2.1 percent to N$37.2 billion. The FNB franchise was a significant contributor to the deposit’s growth at 16.3 percent.

“The economic impact of Covid-19 continued to place acute pressure on life as we know it and our group’s performance – just like many other businesses and individuals did not emerge unscathed. But we believe that trends post lockdown are improving as the economic recovery slowly emerges and we remain hopeful that 2021 will be a better year, for Namibia and its people and the world at large,” Capelao further stated.