JOHANNESBURG - JSE-listed Sasfin Holdings is planning to restructure, which will see Sasfin reduced to three pillars instead of the four that it is operating now.
Executive director Michael Sassoon said yesterday that the group was finalising a proposed restructure to adopt a more focused approach to its target markets along its core pillars of banking, wealth and capital.
Sasfin has four divisions: business banking, wealth, transaction banking and treasury and commercial solutions and capital. With the restructuring as well as an empowerment transaction with Women Investment Portfolio Holdings (Wiphold), which is subject to shareholder and regulatory approvals; and the expected acquisition of the Absa Technology Financial Solutions rental book, the group was confident that it could return to profitability in the next financial year, but this also depended on how the worrying political and economic environment unfolded, the group said.
In June, the group announced that Wiphold would subscribe for 25.1percent in Sasfin for R413million. The group also announced yesterday that it had dropped KPMG as its JSE sponsor as well as its auditor after 18 years due to concerns over good governance.
This came after a well-publicised case involving KPMG with the Guptas and its fumble on the SA Revenue Service “rogue unit” report. For the year to June, the group reported a decline of 16.34percent in headline earnings to R194.15m, down from R232.08m, which the group a saw as a set of disappointing results.
Headline earnings a share declined by 16.34percent to 611.76cents a share, from 731.27c last year. The group said the decline was largely due to an increase in the credit-loss ratio from 108basis points to 124basis points arising from two unusual credit losses, and the impact of a mark-to-market loss on the group’s strategic investment in Efficient Group.
The board declared a dividend of 240.42c per ordinary share, down from 287.89c declared a year ago. Total assets grew 14.71percent to R12.62billion, driven by an 84.52percent growth in cash and short-term negotiable securities to R3.53bn (2016: R1.911bn).
The group said the tough economic and credit environment resulted in muted growth in gross loans and advances to customers of 4.06percent to R6.71bn, down from R6.45bn a year earlier.
Sasfin Capital division was a star performer by reporting an increase of 81.11percent in headline earnings to R36.85m, while business banking was negatively impacted by an increase in credit impairments and slow growth in loans and advances.
Sasfin Wealth headline earnings decreased 51.91percent to R36.75m because of the mark-to-market loss on its investment in Efficient. Assets under management (including assets under advice) decreased from R40.11bn to R38.30bn, attributed to lower portfolio values while assets under administration decreased from R67.86bn to R53.69bn.
Sasfin shares rose 0.53% yesterday to R49.75.
- BUSINESS REPORT