JOHANNESBURG, May 29 (Reuters) - Standard Bank Group , Africa’s largest lender, said on Thursday that bad debts have ticked higher in the first four months of this year, the latest sign South African borrowers remain under pressure from a weak economy.
Borrowers in Africa’s most developed economy are struggling with high unemployment and softer growth, making it harder for them to repay loans. Data this week showed the economy shrank in the first quarter, its first quarterly contraction since a recession five years ago.
Like Standard Bank, other lenders and retailers have recently cautioned about rising bad debts in South Africa, where household debt averages around 75 percent of disposable income.
“Credit impairments have increased moderately due mainly to a tougher domestic environment for our customers, but loss ratios remain within expectations,” the bank said in a performance update for the first four months of the year.
It also said it had seen “good growth” in total income, helped by higher local interest rates and growth in fees and commissions.
Standard Bank is due to hold its annual general meeting on Thursday. Shares of the bank are up 9.7 percent this year, slightly outperforming an 8 percent rise in the benchmark Top-40 index. (Reporting by David Dolan; Editing by Ed Stoddard)