FirstRand earnings up

South African financial group FirstRand announces 13-percent rise in headline earnings for the year.

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Johannesburg - South African financial group FirstRand announced a 13 percent rise in headline earnings for the year to R21.14 billion and declared a total dividend of 210 cents per share – higher than the 174 cents previously paid.

The group, which reported a 17 percent rise in overall profit for the year to end-June of R23.12 billion, said its First National Bank (FNB), Rand Merchant Bank (RMB) and WesBank all grew profits and produced returns on equity that were significantly above targets.

FirstRand CEO designate Johan Burger said the group was well-positioned to deal with an expected worsening in the economic operating environment and would continue deliver both earnings growth and superior returns for shareholders.

“However, the level of outperformance that can be achieved becomes more difficult given the high base and the increasing economic and regulatory headwinds the business faces going forward,” he added.

FirstRand also cautioned that the South African economy was vulnerable to more aggressive interest rate hikes.

“The central bank has so far implemented a gradual and moderate hiking cycle, but the economy remains vulnerable to a more aggressive cycle should capital inflows slow down or reverse,” the group said.

ANA