FirstRand has become the first South African bank to breach the R500bn market capitalisation milestone, cementing its place as the country’s most valuable lender, with Capitec and Standard Bank not that far behind. FirstRand, which owns brands FNB, WesBank and Rand Merchant Bank, among others, enters the new year valued at about R510bn, with Capitec at R482bn and Standard Bank at R478bn. A resurgent Absa is valued at R214bn, up a market-leading 36% over the past six months as investors buy into the growth blueprint laid out by CEO Kenny Fihla, who has infused new energy and a laser focus on execution at the group.
Nedbank is valued at R127bn, after an underwhelming 2025, with the lender hoping for a better market performance heading into 2026, having refocused the business for growth in South Africa and the Southern African Development Community (Sadc) after exiting its disastrous foray into West Africa with the sale of its minority stake in EcoBank. FirstRand, led by Mary Vilakazi, the only woman to run a significant lender in Africa’s most industrialised economy, has been bulking up its portfolio over the past two years. Under Vilakazi it has acquired the South African business of HSBC to beef up its corporate and investment capabilities, while it has also splashed out nearly R5bn on a 20% stake in AI-powered fintech multinational Optasia.
Ratings agency Moody’s has described the transaction as credit positive for FirstRand. South Africa’s banks have been spending big on fintech companies, with Nedbank last year snapping up iKhokha for R1.6bn, while Capitec at the tail end of last year said it will spend as much as R400m to buy Walletdoc, a move that it says will “bring affordability and accessibility to digital payments”. FirstRand does not only hold the title of the country’s most valuable bank but also wins on key metrics that deliver value for shareholders.
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The group, which also owns Ashburton and Aldermore in the UK, in its financial results for the year ended June, reported a 20.2% return on equity, with normalised earnings of R41.8bn and a healthy cost-to-income ratio of 50.8%. For the year ended December 2024, Standard Bank reported R44.5bn in headline earnings, a return on equity of 18.5% and a cost-to-income ratio of 50.5%. Standard Bank’s rest of Africa portfolio continues to be a key growth driver, contributing about R18bn to the group’s headline earnings in the period, with revenue just shy of R60bn.
Capitec, which does not play in the corporate and investment banking space, where Standard Bank, Absa, Nedbank, FirstRandand Investec make good returns, has won over investors with its disciplined focus on areas where the Stellenbosch-based bank believes it has a right to win. The strategy has worked wonders for the lender, which has amassed an unparalleled 25-million clients, with it now looking to disrupt the business banking space and bring more informal businesses into the formal economy fold. Capitec’s share price has surged more than 150% over the past five years as it ruthlessly executed its strategy, with the lender now more valuable than Absa, Nedbank and Investec’s South Africa business combined — something that was unthinkable when the bank burst onto the scene in the early 2000s.
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