Investor Relations

YOU ARE HERE - Home >  Investor Relations >  SENS >  Capital Adequacy – Annual Report – 30 June 2013

Capital Adequacy – Annual Report – 30 June 2013

(Incorporated In the Republic Of South Africa)
Registration Number 1987/002097/06)
Ordinary share code: SFN ISIN: ZAE000006565
Preference share code: SFNP ISIN: ZAE000060273
(“Sasfin” or “the Group”)


Annual Report in terms of Regulation 43 (1) (e) (ii) of the Banks Act 1990 (as amended).

In terms of the requireme nts of the Banks Act, and the banking legislation under Basel III, all registered banks and bank controlling companies are obliged to report certain qualitative and quantitative information on a regular basis to the public.

The following table sets out Sasfin Group’s quantitati ve information relating to its Capital and Capital Adequacy levels as at 30 June 2013, and meets the on-going reporting requirements for annual disclosure in terms of Pillar 3 of the Basel III Accord. The comprehensive Annual Report in terms of Regulation 43 (1) (e) (ii) of the Banks Act 1990 (as amended) is fully disclosed on the Group's website:

The qualitative information regarding the Group's Capi tal Management Plan and Strategy is fully disclosed in the Group's 2013 Integrated Report and Audited Annual Financial Statements. This information is available on the website:
    Sasfin Holdings Limited Sasfin Bank and Subsidiaries
    R'000 %age R'000 %age
1. Total Risk weighted assets & exposures 4,432,573   3,618,051  
  Credit risk 2,250,260   2,241,950  
  Operational risk 750,241   405,993  
  Market risk 192,147   192,147  
  Equity investment risk 463,017   37,764  
  Securitisation risk 528,793   528,793  
  Other risk 248,115   211,404  
2. Common Equity Tier 1 Capital 820,569 18.51 722,884 19.98
  Share Capital & Premium 145,236   313,476  
  Retained Earnings 970,246   524,004  
  Prescribed deductions and non-qualifying reserves -294,913   -114,596  
3. Additional Tier 1 Capital        
  Non-redeemable preference share capital 199,278 4.50 - -
4. Total Tier 1 Capital 1,019,847 23.01 722,884 19.98
5. Tier 2 Capital 123,711 2.79 82,711 2.29
  Sub-ordinated Debt 74,205   74,205  
  General other reserves 45,898   4,898  
  General allowance for credit impairment 3,608   3,608  
  Total Qualifying Capital & Capital Adequacy ratio 1,143,558 25.80 805,595 22.27
6. Minimum Required Capital & Reserves 421,094 9.50 343,715 9.50
7. The South African economy faced a challenging environment, with high levels of social unrest and strike activities across many sectors. Coupled with the escalating energy crisis, South Africa’s competitive edge is being undermined. These factors materially affected the domestic markets and heightened growth concerns needed to stimulate the economy. Unemployment levels remained high, with increased levels of consumer debt driven largely by unsecured lending.

The Group's funding base enhances the ability of Sasfin Bank to meet the stringent Basel III liquidity requirements of liquidity coverage ratio and the net stable funding ratio in a sustainable manner. The Group’s liquidity position remains very healthy with adequate liquidity buffers held for stress situations that may arise.

Whilst the Group’s capital adequacy ratio has declined by 400 bps to 26% (2012: 30%) due to the new capital requirements of Basel III and growth in assets, the Group remains well capitalised per Basel III which came into effect in January 2013, with a tier I capital ratio of 23% (2012: 26%), which is the main measure of capital strength.

The Group is pleased to report that it complies with the new Basel III requirements both at a liquidity and capital level, well ahead of their respective implementation dates.

The Group continues to focus on its growth strategy in response to the changing banking and regulatory landscape with a view to broadening its franchise value by continuing to increase its funding through both term deposits and debt capital market instruments to facilitate Sasfin’s on-going growth.
27 September 2013

Lead Sponsor
KPMG Services (Pty) Limited

Joint Sponsor