Capitec Bank & Mercantile To Merge
Capitec Bank has been outperforming all other local banks in terms of growth for some time now. As they grow their appetite for other types of banking (other than savings and loans) has expanded and they would like to move into other avenues of banking. This was seen when Capitec Bank recently released a credit card for the first time after only offering its Global One account for many years.
Now Capitec Bank is aggressively looking to move into the world of business banking where other banks have long been established such as Nedbank.
Due to financial difficulties in Europe during the global recession Caixa Geral de Depositos (CGD), a Portuguese Bank owned by the Portuguese Republic decided to put Mercantile Bank up for sale. They quickly received interest from around 60 different parties including SA’s Capitec Bank. After some wheeler-dealing, a small bidding battle and sign off from Portugal’s Ministers and President, Capitec Bank came out on top outbidding Nedbank and the PIC.
‘The Competition Tribunal has now given ‘go ahead’ for the merger’
South Africans are used to seeing the Mercantile bank brand around for some time but not many realise how successful they have been through the recession. They have certainly not been taking it easy. Mercantile is considered the largest of SA’s small banks and has had its assets grow from R6 Billion in 2011 to R13 Billion in 2019. It also holds R9 Billion in deposits. It has seen a rather impressive increase in profits of around 15% for the last few years.
This now looks set to continue and perhaps even increase as Capitec got the nod and are going to be merging Mercantile into their brand. The Competition Tribunal has now officially given ‘go ahead’ for the merger (with no conditions). This means that with one swift purchase Capitec Bank will have an established business banking organisation and clientele without having to try to progressively establish one over time.