Absa Reports R12.8bn Profit Despite Pressure Across African Markets

Absa Reports R12.8bn Profit Despite Pressure Across African Markets

August 20, 2026
By Mintesinot Nigussie

Absa Group, one of Africa's major diversified financial services groups, reported an 8 percent increase in headline earnings to 12.8 billion rand for the six months ended June 30, 2026, as strong performance in South Africa helped offset margin pressure across several African markets.

The Johannesburg-based group, which provides personal, business, corporate and investment banking services across African markets, recorded a 4 percent increase in revenue to 58.8 billion rand. Its return on equity rose to 15 percent from 14.8 percent a year earlier.

Net interest income increased 3 percent, while non-interest income grew 6 percent on higher client activity, lending volumes and trading income. Customer loans and advances rose 6 percent and deposits increased 5 percent.

Credit impairments fell 1 percent to 7.1 billion rand, reducing the group's credit loss ratio to 94 basis points from 100 basis points. Operating costs increased 4 percent to 31.4 billion rand, while pre-provision profit rose 4 percent to 27.4 billion rand.

South Africa remained the main source of earnings growth, while lower interest rates in Absa's African markets compressed margins. The stronger rand also reduced the contribution from operations outside South Africa.

Personal and Private Banking recorded the strongest growth among the group's three main businesses, with headline earnings rising 12 percent to 4.1 billion rand. Business Banking earnings increased 5 percent to 2.7 billion rand, while Corporate and Investment Banking rose 1 percent to 6.2 billion rand.

The results mark the first reporting period in which Absa has presented Personal and Private Banking, Business Banking, and Corporate and Investment Banking on a pan-African basis under its new operating model. The restructuring forms part of the group's strategy to build a more integrated African banking business.

Absa's customer base increased to 13.4 million, while technology-related spending rose 7 percent to 8.8 billion rand as the group invested in digital infrastructure, cybersecurity, cloud computing, data and artificial intelligence.

Kenny Fihla, Absa Group chief executive, said the group would continue to deepen client relationships, expand its digital capabilities and grow its presence in key African markets.

Source: FSX Business News