Customers act responsibly during Covid and increase savings

African Bank released its financial results for the full year ended 31 September 2020 today following yesterday’s announcement of the resignation of CEO, Basani Maluleke who is stepping down to pursue other career opportunities.

Gustav Raubenheimer, who has been appointed as interim CEO, subject to approval by the Prudential Authority, said the Board was highly appreciative of Maluleke’s significant contribution in leading the transformation at African Bank to become a diversified and investable retail bank. “We would like to thank Basani for her unwavering commitment and contribution over the last few years and for her passion and enthusiasm, which has become so much a part of our African Bank culture. We wish her the best of luck for the next chapter of her career.”

Commenting at the Results, outgoing African Bank CEO, Basani Maluleke said, “We knew our results would be subdued given the already depressed economy and further impact of the Covid-19 lockdowns.  We are encouraged to see that although we reported a net loss after tax of R27 million for the full year, the second half of our 2020 financial year saw significant recovery. Our performance improved from a loss of R111 million in the first half, to a profit in the second half, of R84 million. The Group remains strong and resilient, supported by a robust balance sheet, an engaged and passionate work force and a dedicated focus of adding value and affordability to our customers.”


For all its stakeholders, this bodes well as the Bank continues to transition from a single-product business, operating through a single channel, to a diversified financial services business. Maluleke says one of the most positive trends seen over the last six months was a steady increase in the Bank’s Savings and Investments portfolio and an increase in the use of the MyWORLD bank account.

MyWORLD offers customers real value in terms of price and its multi-channel ability to navigate across all our various products with ease. “We opened 378 000 MyWORLD accounts since the launch of MyWORLD in May 2019. During that time, the Bank processed transactions with a value of R8.9 billion. Our digital offering and diverse product range provides new opportunities to cross-sell and gain deeper customer insights.” The Bank has also completed the full implementation of its Omni-channel, which began in 2017 giving it a distinct leading-edge. This system enables customers’ easy access across multiple channels and all products ranges, and access to a chatbot, “Karabo”, giving immediate assistance to the simpler queries received from its customers.”

She says with its high degree of personalisation and competitive value offered, this is a product which will continue to disrupt the banking sector. African Bank was highlighted by Forbes for being one of only 50 companies changing the world by driving shared value. MyWORLD is the first shared banking account and customers can enjoy the best interest rates across all its Savings and Investment products. MyWORLD offers excellent interest rates on any positive balance, while customers can invest in any of the Savings and Investment products, with just R500.


Diversifying its product base and operating through both a traditional, but modernised, branch network and digital channels, will continue to be a focus. “To date, the branch network remains our key channel for sales and service, supporting the need for face-to-face engagements and an empathy-driven focus with customers. Our aim within branch banking is to provide customers with the best possible advice and service that we can.”


While Covid-19 has had a significant impact on many of our customers, it is still through face-to-face conversation that the Bank has been best-placed to reassure and guide customers and provide the necessary financial wellness advice and assistance. “Customers remain at the centre of everything we do.” In March 2020, the South African Customer Satisfaction Index rated African Bank the best bank for customer service in South Africa. BrandsEye further reported African Bank to be the only bank with a positive online sentiment. “Both accolades were well received by our executive committee and our people, given that one of our key pillars is customer centricity,” Maluleke notes.


The increase in the Savings and Investments portfolio, amidst all of this uncertainty is very positive. It speaks to a more prudent and conservative approach to money from customers and their eagerness to earn good interest rates on their hard-earned cash. “This pandemic really showed us that we have to expect the unexpected and with so much uncertainty, savings become key, even if the term is a bit shorter. Our loan disbursements have decreased, while there has been an improvement in our Collections as we see more people trying to pay down their debt.”


Looking forward, the Bank’s imperative is to future-proof the organisation, which provides the bedrock to a sustainable business that competes across the fintech and banking landscape in terms of both value, price and digital innovation.


“Our commitment to our customers remains unwavering.  Our purpose is to advance lives through financial and related services and we remain steadfast in our commitment to make a continued and meaningful contribution,” concludes Raubenheimer.