Absa expects 10-fold rise in interim profit

ABSA EXPECTS a 10-fold jump in profit for the six months to June 30, it said yesterday, citing cost controls and reduced bad debts.

The bank reported headline earnings per share, the country’s main profit measure, of 67.7 cents in the same period last year.

One of South Africa’s top four banks, Absa is bouncing back from hefty provisions taken last year, because of the pandemic.

It said the credit charge at its corporate and investment bank, as well as for its home and personal loans books, had “improved substantially”.

“Credit impairments dropped by mid-teens year-on-year,” it said, adding the bank benefited from falling costs and strong trading revenue.

Revenue was flat, while business outside of South Africa saw a fall in profit on higher costs.

The bank was one of two South African lenders to hold off on a resumption of dividends at its full-year results in March.

Investors were surprised by the sudden departure of chief executive Daniel Mminele last month, after only 15 months in the job.