Categories
Media release

Media release

Absa Group delivered an 8% increase in headline earnings to R12.8 billion supported by revenue growth of 4% to R58.8 billion

18 August 2026

Salient points 

  • Revenue rose 4% to R58.8 billion 
  • Pre-provision profit increased 4% to R27.4 billion 
  • Impairments decreased 1% to R7.1 billion 
  • Credit-loss-ratio improved to 94 basis points (bps) from 100 bps  
  • Operating costs grew 4% to R31.4 billion 
  • Cost-to-income ratio increased to 53.4% from 53.2% 
  • Headline earnings increased 8% to R12.8 billion 
  • Dividend per share increased 8%  to 850 cents 
  • Return on equity increased to 15% from 14.8% 
  • Common Equity Tier 1 (CET 1) ratio of 12.8%, slightly above Board target range of 11.0% – 12.5%  

Absa Group reported a solid financial performance for the six months ended 30 June 2026, despite a challenging and uncertain operating environment, supported by the strength of its South African business. 

The first half of 2026 is characterised by elevated geopolitical uncertainty, changing interest rate dynamics and varied economic conditions across the Group’s markets. Against this backdrop, the Group delivered headline earnings of R12.8bn and a return on equity of 15%, reflecting disciplined execution and a continued focus on sustainable growth.  

Group revenue increased by 4%, driven by continued momentum in non-interest income, which grew faster than net interest income. Net interest income grew by 3%, with continued growth in customer loans and deposits partly offset by margin compression. Margins were impacted by the lower interest rate environment in Africa Regions and competitive lending and deposit pricing in Corporate and Investment Banking South Africa, moderating the benefit of balance sheet growth.  Net customer loans and advances expanded by 6% and customer deposits increased by 5%, reflecting healthy client activity and the strength of our franchise across our markets. 

Non-interest income increased by 6%, supported by growth in fee and commission income driven by increased client activity and higher lending volumes and a solid trading income contribution from Global Markets.  

Operating expenses increased by 4% as the Group continues to invest in strategic initiatives while maintaining cost discipline. Pre-provision profit grew by 4%, reflecting the balance between revenue growth and continued investment in the business.  

Credit performance remained resilient, with credit impairments declining, resulting in an improved credit loss ratio. Lower credit impairments in Personal and Private Banking are supported by improved customer payment behaviour, while credit impairments in Business Banking and Corporate and Investment Banking normalised.  

Commenting on the results, Kenny Fihla, Group Chief Executive Officer says: “Our first-half performance demonstrates the strength of our franchise in a complex operating environment, and early days of delivering on our strategy. We continue to grow our customer franchise, delivering disciplined execution across our businesses and maintain a strong capital position. We remain focused on executing our strategic priorities, including deepening client relationships, enhancing our digital capabilities, growing our presence across key African markets and building a more integrated pan-African business. Our healthy client franchise growth and the expected stabilisation of net interest margins position us well to accelerate sustainable growth over the medium term. We are confident amid an uncertain trading environment, in our medium-term growth trajectory and our ability to create sustainable value for our clients, colleagues, shareholders and the communities we serve.”  

Business unit performance 

Absa Group’s performance reflects continued strategic execution and the benefits of its new pan-African operating model. This is first time, all three business units, Personal and Private Banking, Business Banking and Corporate and Investment Banking are being reported on a pan-African basis. Against this backdrop, each business delivered resilient performances supported by strong client activity, franchise growth and disciplined execution. 

Business unit headline earnings performance

Business Unit 2026 Headline Earnings Change Year-on-Year
Corporate and Investment Banking R6.2 billion Increased 1%
Personal and Private Banking R4.1 billion Increased 12%
Business Banking R2.7 billion Increased 5%

Corporate and Investment Banking (CIB) delivered headline earnings growth of 1%, supported by solid performances in Investment Banking and Global Markets. Increased client activity drove growth in non-interest revenue. Customer loan and deposit growth remained robust, reflecting sustained client demand and franchise strength. This impact on net interest income was largely offset by margin compression. Lower revenue from Transactional Banking, together with higher credit impairments and operating expenses, partially offset this performance. 

Personal and Private Banking (PPB) delivered headline earnings growth of 12%, underpinned by continued growth in active customers and strong digital adoption across South Africa and Africa Regions. Increased customer engagement, combined with balance sheet growth, improved margins and higher digital transaction activity, supported revenue growth, while lower credit impairments contributed positively to earnings performance and improved returns. 

Business Banking (BB) reported headline earnings growth of 5%, driven by solid growth in customer lending and deposits, increased client activity and improved returns. South Africa delivered a strong performance, supported by higher commercial and SME lending demand, while growth in international banking and foreign exchange contributed to non-interest revenue growth. Margin compression in Africa Regions continued to weigh on earnings growth in those markets. 

Head Office, Treasury, and other operations reported an improved result reflecting the continued benefits of asset and liability management optimisation, realised gains on bond disposals, reversals of sovereign credit impairments and lower operating costs driven by transfer pricing enhancements supported by various cost management initiatives. These gains were partially offset by a lower interest rate environment in Africa Regions, which reduced yields on liquid asset portfolios. 

Performance across geographic segments reflects differing economic conditions. South Africa produced strong headline earnings growth, supported by solid pre-provision profit growth and a lower credit loss ratio. In contrast, earnings in Africa Regions were impacted by lower net interest income as lower interest rates continue to affect margins and higher operating expenses. A stronger rand also slightly reduced the contribution from operations outside South Africa.  

 Commenting on the Group’s financial performance, Deon Raju, Absa Group Financial Director, said: “Against a backdrop of continued geopolitical uncertainty, changing interest rate expectations and margin pressure in several of our markets, we delivered a solid financial performance. Revenue growth was supported by continued momentum in non-interest income, while disciplined cost management and an improved credit performance underpinned earnings growth. Our capital position remains strong, with the CET1 ratio ending the period above the upper end of our target range, enabling us to continue investing in growth opportunities while maintaining an attractive dividend payout for shareholders.” 

Non-financial performance 

Absa Group’s customer base increased to 13.4 million, supported by continued growth across Africa Regions, driven by targeted customer engagement initiatives, enhanced customer value propositions and ongoing new-to-bank acquisition programmes. 

Absa continued to invest in technology and digital transformation during the period, with IT-related spend increasing by 7% to R8.8 billion. Investment remained focused on strengthening digital infrastructure, enhancing cybersecurity capabilities, advancing data, cloud and artificial intelligence initiatives, and enabling the delivery of improved customer experiences across the Group. 

The Group continued to strengthen its cyber resilience through ongoing investment in advanced security capabilities, threat detection and response technologies, and the protection of customer data and digital assets. These investments support customer trust, safeguard digital banking platforms and enhance the resilience of the Group’s operations across its markets.  

Absa also continued to modernise its technology platforms and expand its cloud, data and AI capabilities, improving scalability, operational efficiency and innovation while supporting sustainable long-term growth across the Group. 

Outlook 

The outlook for the global economy remains uncertain, as events in the Middle East remain volatile, while the US has announced a new round of tariffs on dozens of countries. Moreover, there is evidence of a very large El Nino weather event from late 2026 and into 2027 that could bring extreme drought or rain to many parts of the world, with potential knock-on effects on global food prices.  

We have trimmed our baseline real GDP growth for South Africa to 1.5% and we expect policy rates to remain unchanged into early 2027. The outlook for our presence economies in Africa Regions remains constructive and we project real GDP growth to slightly exceed last year’s 5.0%, given ongoing infrastructure investment, multilateral support and ongoing reforms. Downside risks pertaining to the fallout from Middle East crisis remain significant, along with potential adverse weather conditions. 

Based on these assumptions, and excluding further major unforeseen political, macroeconomic, or regulatory developments, our guidance for 2026 is as follows: We expect low- to mid-single digit revenue growth. We expect high single digit growth in customer loans and mid-to high single digit growth in customer deposits. The Group’s credit loss ratio is expected to last year and in the middle of our through-the-cycle target range of 75 to 100 basis points. We expect low- to mid-single digit growth in operating expenses, producing slightly negative operating JAWS and low-to mid-single digit pre-provision profit growth. Consequently, we expect a RoE of around 15%. We expect the Group CET1 ratio to finish 2026 at the top end of our Board target range of 11.0% to 12.5%. Finally, we expect to maintain a dividend payout ratio of 55% for 2026. 

For Group CEO video remarks and a video clip featuring our highlights for the full year, please visit News and Insights – Absa Group | Welcome to Absa Group Limited. 

To view our SENS and investor materials, visit Financial results – Absa Group | Welcome to Absa Group Limited 

18 August 2026

Salient points 

  • Revenue rose 4% to R58.8 billion 
  • Pre-provision profit increased 4% to R27.4 billion 
  • Impairments decreased 1% to R7.1 billion 
  • Credit-loss-ratio improved to 94 basis points (bps) from 100 bps  
  • Operating costs grew 4% to R31.4 billion 
  • Cost-to-income ratio increased to 53.4% from 53.2% 
  • Headline earnings increased 8% to R12.8 billion 
  • Dividend per share increased 8%  to 850 cents 
  • Return on equity increased to 15% from 14.8% 
  • Common Equity Tier 1 (CET 1) ratio of 12.8%, slightly above Board target range of 11.0% – 12.5%  

Absa Group reported a solid financial performance for the six months ended 30 June 2026, despite a challenging and uncertain operating environment, supported by the strength of its South African business. 

The first half of 2026 is characterised by elevated geopolitical uncertainty, changing interest rate dynamics and varied economic conditions across the Group’s markets. Against this backdrop, the Group delivered headline earnings of R12.8bn and a return on equity of 15%, reflecting disciplined execution and a continued focus on sustainable growth.  

Group revenue increased by 4%, driven by continued momentum in non-interest income, which grew faster than net interest income. Net interest income grew by 3%, with continued growth in customer loans and deposits partly offset by margin compression. Margins were impacted by the lower interest rate environment in Africa Regions and competitive lending and deposit pricing in Corporate and Investment Banking South Africa, moderating the benefit of balance sheet growth.  Net customer loans and advances expanded by 6% and customer deposits increased by 5%, reflecting healthy client activity and the strength of our franchise across our markets. 

Non-interest income increased by 6%, supported by growth in fee and commission income driven by increased client activity and higher lending volumes and a solid trading income contribution from Global Markets.  

Operating expenses increased by 4% as the Group continues to invest in strategic initiatives while maintaining cost discipline. Pre-provision profit grew by 4%, reflecting the balance between revenue growth and continued investment in the business.  

Credit performance remained resilient, with credit impairments declining, resulting in an improved credit loss ratio. Lower credit impairments in Personal and Private Banking are supported by improved customer payment behaviour, while credit impairments in Business Banking and Corporate and Investment Banking normalised.  

Commenting on the results, Kenny Fihla, Group Chief Executive Officer says: “Our first-half performance demonstrates the strength of our franchise in a complex operating environment, and early days of delivering on our strategy. We continue to grow our customer franchise, delivering disciplined execution across our businesses and maintain a strong capital position. We remain focused on executing our strategic priorities, including deepening client relationships, enhancing our digital capabilities, growing our presence across key African markets and building a more integrated pan-African business. Our healthy client franchise growth and the expected stabilisation of net interest margins position us well to accelerate sustainable growth over the medium term. We are confident amid an uncertain trading environment, in our medium-term growth trajectory and our ability to create sustainable value for our clients, colleagues, shareholders and the communities we serve.”  

Business unit performance 

Absa Group’s performance reflects continued strategic execution and the benefits of its new pan-African operating model. This is first time, all three business units, Personal and Private Banking, Business Banking and Corporate and Investment Banking are being reported on a pan-African basis. Against this backdrop, each business delivered resilient performances supported by strong client activity, franchise growth and disciplined execution. 

Business unit headline earnings performance

Business Unit 2026 Headline Earnings Change Year-on-Year
Corporate and Investment Banking R6.2 billion Increased 1%
Personal and Private Banking R4.1 billion Increased 12%
Business Banking R2.7 billion Increased 5%

Corporate and Investment Banking (CIB) delivered headline earnings growth of 1%, supported by solid performances in Investment Banking and Global Markets. Increased client activity drove growth in non-interest revenue. Customer loan and deposit growth remained robust, reflecting sustained client demand and franchise strength. This impact on net interest income was largely offset by margin compression. Lower revenue from Transactional Banking, together with higher credit impairments and operating expenses, partially offset this performance. 

Personal and Private Banking (PPB) delivered headline earnings growth of 12%, underpinned by continued growth in active customers and strong digital adoption across South Africa and Africa Regions. Increased customer engagement, combined with balance sheet growth, improved margins and higher digital transaction activity, supported revenue growth, while lower credit impairments contributed positively to earnings performance and improved returns. 

Business Banking (BB) reported headline earnings growth of 5%, driven by solid growth in customer lending and deposits, increased client activity and improved returns. South Africa delivered a strong performance, supported by higher commercial and SME lending demand, while growth in international banking and foreign exchange contributed to non-interest revenue growth. Margin compression in Africa Regions continued to weigh on earnings growth in those markets. 

Head Office, Treasury, and other operations reported an improved result reflecting the continued benefits of asset and liability management optimisation, realised gains on bond disposals, reversals of sovereign credit impairments and lower operating costs driven by transfer pricing enhancements supported by various cost management initiatives. These gains were partially offset by a lower interest rate environment in Africa Regions, which reduced yields on liquid asset portfolios. 

Performance across geographic segments reflects differing economic conditions. South Africa produced strong headline earnings growth, supported by solid pre-provision profit growth and a lower credit loss ratio. In contrast, earnings in Africa Regions were impacted by lower net interest income as lower interest rates continue to affect margins and higher operating expenses. A stronger rand also slightly reduced the contribution from operations outside South Africa.  

 Commenting on the Group’s financial performance, Deon Raju, Absa Group Financial Director, said: “Against a backdrop of continued geopolitical uncertainty, changing interest rate expectations and margin pressure in several of our markets, we delivered a solid financial performance. Revenue growth was supported by continued momentum in non-interest income, while disciplined cost management and an improved credit performance underpinned earnings growth. Our capital position remains strong, with the CET1 ratio ending the period above the upper end of our target range, enabling us to continue investing in growth opportunities while maintaining an attractive dividend payout for shareholders.” 

Non-financial performance 

Absa Group’s customer base increased to 13.4 million, supported by continued growth across Africa Regions, driven by targeted customer engagement initiatives, enhanced customer value propositions and ongoing new-to-bank acquisition programmes. 

Absa continued to invest in technology and digital transformation during the period, with IT-related spend increasing by 7% to R8.8 billion. Investment remained focused on strengthening digital infrastructure, enhancing cybersecurity capabilities, advancing data, cloud and artificial intelligence initiatives, and enabling the delivery of improved customer experiences across the Group. 

The Group continued to strengthen its cyber resilience through ongoing investment in advanced security capabilities, threat detection and response technologies, and the protection of customer data and digital assets. These investments support customer trust, safeguard digital banking platforms and enhance the resilience of the Group’s operations across its markets.  

Absa also continued to modernise its technology platforms and expand its cloud, data and AI capabilities, improving scalability, operational efficiency and innovation while supporting sustainable long-term growth across the Group. 

Outlook 

The outlook for the global economy remains uncertain, as events in the Middle East remain volatile, while the US has announced a new round of tariffs on dozens of countries. Moreover, there is evidence of a very large El Nino weather event from late 2026 and into 2027 that could bring extreme drought or rain to many parts of the world, with potential knock-on effects on global food prices.  

We have trimmed our baseline real GDP growth for South Africa to 1.5% and we expect policy rates to remain unchanged into early 2027. The outlook for our presence economies in Africa Regions remains constructive and we project real GDP growth to slightly exceed last year’s 5.0%, given ongoing infrastructure investment, multilateral support and ongoing reforms. Downside risks pertaining to the fallout from Middle East crisis remain significant, along with potential adverse weather conditions. 

Based on these assumptions, and excluding further major unforeseen political, macroeconomic, or regulatory developments, our guidance for 2026 is as follows: We expect low- to mid-single digit revenue growth. We expect high single digit growth in customer loans and mid-to high single digit growth in customer deposits. The Group’s credit loss ratio is expected to last year and in the middle of our through-the-cycle target range of 75 to 100 basis points. We expect low- to mid-single digit growth in operating expenses, producing slightly negative operating JAWS and low-to mid-single digit pre-provision profit growth. Consequently, we expect a RoE of around 15%. We expect the Group CET1 ratio to finish 2026 at the top end of our Board target range of 11.0% to 12.5%. Finally, we expect to maintain a dividend payout ratio of 55% for 2026. 

For Group CEO video remarks and a video clip featuring our highlights for the full year, please visit News and Insights – Absa Group | Welcome to Absa Group Limited. 

To view our SENS and investor materials, visit Financial results – Absa Group | Welcome to Absa Group Limited