Capitec FY25 Results: Record Profit Growth, Higher Dividends, and Expanding Client Base

The South African banking giant has delivered a standout financial performance for the year ended 28 February 2025, reporting a 30% surge in headline earnings to R13.7 billion. The impressive growth comes off the back of a sharply expanding client base, growing digital adoption, and strong performance across its business banking, insurance, and digital products.

Client Base Grows to Over 24 Million

Capitec’s strategy to broaden its offerings is clearly paying off. Over the past five years, the bank has rolled out several new services, including business banking, Capitec Connect mobile, and its own insurance products. This has helped push the active client base from 22.2 million in 2024 to 24.1 million in 2025.

Its physical footprint also expanded with 16 new branches, bringing the total to 880 branches across South Africa.

Digital Boom: 15% Growth in App Users

The digital shift continues to gain momentum, with active app users up 15% to 12.9 million. Digital transactions and card payments now make up 90% of total transaction volumes, driven by services like Capitec Pay and value-added offerings.

Headline Earnings and ROE on the Rise

With net interest income rising by R2.7 billion, and non-interest income — including transaction fees and value-added services — jumping 22%, Capitec has managed to lift its Return on Equity (ROE) from 26% to 29%.

The bank’s credit loss ratio also improved significantly, falling from 8.7% to 6.9% (excluding AvaFin) — an important indicator of better-quality lending.

Loan Disbursements Surge Across the Board

Credit activity picked up pace in FY25, with a 28% increase in loan disbursements to individual clients, and 29% growth in business banking loans. Despite the 12% growth in total loans, the credit impairment charge dropped by 6%, highlighting better risk management.

Insurance and Non-Interest Revenue Boost Earnings

Capitec’s insurance operations added R437 million to headline earnings, bolstered by strong growth in funeral and life cover income (+44%).

Meanwhile, net transaction income and commissions — including fees from Capitec Connect — were up 25%, contributing significantly to the R3.1 billion jump in headline earnings.

Dividend Payout Jumps 34%

Thanks to this strong performance, the bank declared a final gross dividend of 4,425 cents per share, bringing the full-year dividend to 6,510 cents — a 34% increase from the previous year. Capitec also adjusted its payout ratio from 50% to 55%, returning more to shareholders amid improved profitability.

Capitec’s FY25 results are a clear signal of the bank’s continued dominance and growth in South Africa’s retail banking space. With an expanding client base, soaring digital adoption, and rising profits, the bank is not only “killing it” — it’s setting the pace for the sector.

As competition heats up in South Africa’s banking sector, Capitec is showing exactly how to stay ahead of the curve.

{Source BusinessTech}

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