Big-four bank Absa ramped up its IT-related spend by 7% to R8.8 billion during the six months ended 30 June.
This emerged when the JSE-listed financial services institution today announced its interim financial results for the period.
The bank says investment remained focused on strengthening digital infrastructure; enhancing cyber security capabilities; advancing data, cloud and artificial intelligence (AI) initiatives; and enabling the delivery of improved customer experiences across the group.
Absa notes it 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,” the bank says.
Absa adds that it 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.
In a statement, Absa says 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 R12.8 billion and a return on equity of 15%.
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.
The bank notes that margins were impacted by the lower interest rate environment in Africa Regions and competitive lending and deposit pricing in Corporate 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, it adds.
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, it states.
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 maintaining 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."
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