South African lender FirstRand reports 22% increase in full-year profit

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JOHANNESBURG, September 15 (Reuters)South African lender FirstRand Ltd FSRJ.J on Thursday reported a 22% rise in full-year profit, near the middle of its estimated range, as the bank continued to benefit from a rebound in economic activity.

The continent’s largest bank by market capitalization posted overall earnings per share (HEPS) – the main measure of earnings in South Africa – of 585.3 South African cents ($0.3346), down from 480, 5 cents a year ago.

South African lenders rebounded earlier than expected from COVID-19 lows, but appear to be walking a fine line between high local unemployment compounded by rising inflation and higher interest rates, which which is positive for banks but increases the risks that loans go bad.

However, the country’s major banks have so far said they would see a net benefit at higher rates, bolstering their core business.

FirstRand posted net interest margin, which shows a bank’s profit from its core interest-earning assets, of 4.4%, up 5 basis points from a year earlier.

($1 = R17.4919)

(Reporting by Promit Mukherjee; editing by David Evans)

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