Capitec edges FirstRand to become Africa’s most valuable bank as earnings seen up to 25%

The contest for the title of Africa’s most valuable bank tightened again this week, with Capitec Bank moving ahead of FirstRand after a modest rise in its share price, marking a key milestone in its transformation from a traditional retail lender to a broader financial services provider.

The bank’s shares rose nearly 0.5 percent on the Johannesburg Stock Exchange (JSE) on Wednesday, February 11, lifting its market capitalization to R534.22 billion ($33.67 billion), slightly above FirstRand’s R533.46 billion ($33.62 billion). While the margin is narrow, it reflects years of focused effort to expand Capitec’s offerings and strengthen its digital presence.

Capitec shares hit record after forecast

The move follows a trading update released during market hours, in which Capitec projected headline earnings per share (HEPS) could increase by up to 25 percent for the financial year ending February 28, 2026. The bank expects HEPS between R14.29 ($0.90) and R14.89 ($0.93), compared with R11.91 ($0.75) in 2025. Total headline earnings are forecast at R16.5 billion ($1.03 billion) to R17.2 billion ($1.08 billion).

Under JSE rules, any expected deviation of 20 percent or more from previous results must be disclosed—a threshold Capitec has now exceeded. Investor response was immediate, sending shares to record levels above R4600 each, signaling confidence in Capitec’s digital-first approach and expanded services.

Fee reductions boost transactions domestically

Capitec’s growth began 25 years ago, when Michiel Le Roux with Jannie Mouton and Riaan Stassen, launched the bank to serve South Africa’s emerging middle class. Initially focused on lower-income retail customers, the bank quickly broadened into full-service personal and business banking. Its model emphasizes simplicity, offering direct access to credit, savings, insurance and payment services, a strategy that resonated with individual and business clients.

International expansion has played a role in Capitec’s strategy. It acquired a 40.66 percent stake in Polish online lender Avafin in 2017, increasing its holding to 97.69 percent in 2024 through a €26.3 million ($27.1 million) transaction. Domestically, Capitec simplified fees in March 2025, reducing transaction and merchant costs. The move, rather than eroding margins, encouraged client growth and higher transaction volumes, further supported by Capitec Connect.

Digital-first strategy boosts Capitec growth

From serving underserved retail customers to becoming a digital-first institution reaching millions, Capitec Bank has built a customer-focused ecosystem that balances accessibility with profitability. Surpassing FirstRand highlights a shift in South African banking, where innovation, technology adoption, and practical customer solutions increasingly define leadership.

With full-year results approaching, Capitec’s $33.67 billion blockbuster market capitalization demonstrates investor trust and the payoff of nearly 25 years of deliberate strategy. Its evolution offers insight into how African banks can expand globally, adopt technology, and maintain strong domestic roots—all while meeting clients where they are.