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Absa has won the contract to provide custody services for the Government Employees Pension Fund (GEPF), Africa’s largest pension fund — a mandate that has been held by its bigger rival Standard Bank for the past three decades, as Absa looks to flex its transactional banking muscle.

The GEPF, whose assets are managed by the Public Investment Corporation (PIC), has more than 1.2-million active members and in excess of 550,000 pensioners and other beneficiaries. The fund manager has more than R3-trillion in assets.

The PIC will continue to manage the GEPS’s underlying assets. Absa CEO Kenny Fihla said the GEPF contract presents a huge win for the group he joined just more than a year ago.

Fihla said this is but one of the significant deals the group is working on as it ropes in new talent to shore up its deal-making capabilities.

“From a people point of view, the necessary steps have already been taken. What we need to do now is accelerate the deals those teams are working on. All that is required is to show two or three wins in order to demonstrate confidence within the organisation,” Fihla told Business Day on Tuesday.

“Once we are able to land the deals we are already working on, it will create momentum that will be self-generating.

“There is no other pension fund that has the GEPF’s scale in the market. We are quite pleased over that win. It demonstrates our custody capability and positions us exceptionally well to also go after other custody mandates. The contract is also a confidence booster; to land the biggest custody mandate in the country by far signals we can win big deals.”

Standard Bank has acted as custodian to GEPF since the fund’s inception in 1996 and in 2015 expanded its mandate with the fund to include investment reporting services.

Custody management of a pension fund is the professional oversight, safekeeping and administration of the fund’s financial assets.

Absa has hired scores of investment bankers as it looks to boost its underdeveloped structural deals capabilities, up the ante in its transactional banking franchise and achieve higher growth in its global markets business.

(Dorothy Kgosi)

The group on Tuesday reported headline earnings growth of 8% in the first half, as a strong performance from its South African operations offset lower earnings from its operations in other African regions.

The group, which has more than 13.4-million customers, said headline earnings for the six months to end-June rose 8% to R12.8bn, or 1,545.4c per share.

Revenue was up 4% to R58.8bn as net interest income rose 3% to R37.4bn and noninterest income increased 6% to R21.4bn.

Net loans and advances grew 6% while deposits and debt funding rose 8%.

Credit impairment charges fell 1% to R7.1bn, producing a 0.94% credit loss ratio from 1% a year ago.

Geographically, South African headline earnings increased 17% to R9.2bn while the Africa regions dropped 10% to R3.6bn.

Africa regions, which include Botswana, Ghana, Kenya, Mauritius, Mozambique, Seychelles, Tanzania, Uganda and Zambia, contributed 30% of group revenue and 28% of headline earnings, Absa said.

Return on equity (RoE) improved to 15% from 14.8% and an interim dividend of 850c per share was declared, an increase of 8% from a year ago.

In terms of divisional headline earnings, corporate and investment banking rose 1% to R6.2bn, personal and private banking 12% to R4.1bn, and business banking 5% to R2.7bn.

The group said while the outlook for the global economy remains particularly uncertain, it expects South Africa’s economy to grow by 1.5% this year, up slightly from 2025’s 1.1%.

Business Day