Lapsing of Mercantile Bank’s banking license
You will recall that, following a lengthy sale and regulatory approvals process, Capitec Bank Limited (Capitec) acquired Mercantile Bank Limited (Mercantile) late last year. It was Capitec’s objective to build on the Mercantile foundation to offer the best business banking solution for small and medium-sized enterprises in South Africa, while staying true to the same fundamentals that made Capitec the bank of choice for more than 14 million South Africans.
Pursuant to the sale process and in terms of section 54 of the Banks Act, 94 of 1990, we received consent from the Prudential Authority and the Minister of Finance to transfer the Mercantile business to Capitec. The effective date of transfer will be 1 December 2020 and, on this date, all Mercantile’s assets and liabilities will transfer to and vest in Capitec. Accordingly, all agreements, appointments, transactions, and documents entered into, made, drawn up, or executed with, by or in favour of Mercantile and in force immediately prior to the transfer, shall remain in full force and effect and shall be construed for all purposes as if they had been entered into, made, drawn up or executed with, by or in favour of Capitec. The only major exception shall be Mercantile’s financial services provider (FSP) license, which cannot be transferred and will lapse. Capitec’s existing FSP license will be amended to include Mercantile’s current financial product and service offering.
With this in mind, please note that, effective from 1 December 2020, Mercantile will become a division of Capitec Bank Limited and will use Capitec’s FSP license and registration as detailed below:
Mercantile Bank a division of Capitec Bank Limited Reg. No: 1980/003695/06. An authorised financial services provider (FSP46669) and registered credit provider (NCRCP13).
These changes are fairly significant but they should have no impact on you or on the way you interact with Mercantile. In this regard:
- Your current relationship with Mercantile Bank will not be affected. Your accounts (including current, savings, investment, trading and loan accounts) will remain unchanged except that Capitec will become the counterparty to any existing agreement, without you having to complete or sign any paperwork.
- Your investments will remain secure and Capitec will assume liability for them on the back of a much stronger balance sheet.
- Any loan(s) payable by you to Mercantile will become payable to Capitec and any security you have given in respect of such loan(s) will transfer to Capitec.
- There will be no adverse impact on banking and other fees payable by you.
- You will have the benefit of access to a broader contact network under a very strong brand and the current Mercantile business centre network will be expanded.
- There will be no major system changes in the short-term, although there will be some in the longer-term as we work to find ways to help entrepreneurs live and bank better.
- You will continue to enjoy the service and product offering to which you are accustomed and we will continue on our journey to build the best business bank for all our current and future clients.
If you have any complaints that we are not able to address, please raise these to:
1.Ombudsman for Banking Services
Tel: 0860 800 900
Email: [email protected]
2. FAIS Ombudsman
Tel: 012 762 5000 / 012 470 9080
Fax: 086 764 1422 / 012 470 9097 / 012 348 3447
Mercantile Bank Boksburg Business Centre is moving to a new home!
Mercantile Bank Boksburg Business Centre will be relocating to new premises in order to provide you with convenience, improved banking experience and personal interactions. The relocation will be effective from Close of Business Trading Hours on the 20th of November 2020. As such, the Business Centre will operate from the new premises on the 23rd of November 2020.
Please find below the new Boksburg Business Centre address:
The Palms Centre,
North Rand Road, Boksburg
GPS coordinates 26.1775° S, 28.2482° E
Our contact number remains the same - Tel: (011) 918 5276. Please don’t hesitate to contact our Boksburg Business Centre team for any assistance required.
We would like to thank you for your loyal patronage, and we look forward to being of continued service to you at our Business Centres.
Have you tried our self-service channels?
With over 4000 ATMs across the country, we have made banking easy, convenient and cost effective. Visit any Capitec ATM and do your banking outside of normal banking hours and without the need to visit our business centres. You can manage your accounts, check your balances, withdraw and deposit cash, and more.
What can you do?
Use your Mercantile bank card to perform the following transactions at Capitec ATM devices;
- Withdraw cash up to your daily set limit
- Deposit cash using your Mercantile card or account at a Capitec Cash accepting device allowing up to 200 notes per deposit. You can make as many deposits as you like. If you need to make larger deposits, please speak to us about our Safe Cash/ CIT Solution, end to end cash solution.
- Change your PIN
- Check your balance
And, we understand that no one likes paying bank fees, so we do what we can to keep ours as low as possible. There is no sign-up fee, no monthly subscription fees – just pay as you use.
Cash deposits: R1.20 per R100
Cash withdrawals: R9 per R1,000
We have also made finding an ATM easy for you. Click on the below link to locate the nearest ATM.
Banking made easy for you!
Experian Data Breach.
We are aware of the Experian data breach, which has led to a third party gaining access to consumers' contact details. Our team is working closely with the relevant authorities to ensure that our clients are protected. While the information cannot be used to access your banking profile, fraudsters may attempt to use it for phishing, where they contact you posing as your bank or other institution in an attempt to trick you into sharing further personal information. Your bank will never contact you to request information such as your banking or card pin, online passwords, CVV number or account number.
If you suspect that your identity has been compromised, apply immediately for a free Protective Registration listing with Southern Africa Fraud Prevention Service (SAFPS) by emailing [email protected]. This will alert SAFPS members, including banks and credit providers, that they should take extra precautionary measures to ensure the identity of the client is confirmed.:
Government initiatives to support South African small and medium enterprises (SMEs) – March 2020
As part of measures to curb the COVID-19 pandemic in South Africa, President Ramaphosa recently announced several initiatives to support South African small and medium enterprises (“SMEs”) and we would like to encourage our clients to register and/or apply for these forms of government support as soon as possible.
From the information that is currently available, it seems priority will be given to companies that benefit women, youth, and people living with disabilities, and black-owned businesses, but it has been made clear that all small and medium business enterprise owners will be able to apply for some forms of funding if they meet at least the following criteria:
- The business must be 100% South African-owned;
- at least 70% of employees must be South Africans; and
- recipients must be tax compliant.
The funds announced to date include:
- The Solidarity Fund, under which R2 billion has been specifically earmarked to assist small businesses and their employees affected by the coronavirus pandemic. For more information on the Solidarity Fund, please visit www.solidarityfund.co.za or contact the Fund on [email protected] or 0860 001 001.
- The Department of Small Business Development has made R500 million available immediately through a simplified application process to assist small and medium enterprises that are in distress. Businesses can register for support by visiting https://smmesa.gov.za/ or contacting the helpline on 0860 663 7867.
- The Industrial Development Corporation, together with the Department of Trade, Industry and Competition has released a package of more than R3 billion for industrial funding to address the situation of vulnerable firms and to fast-track financing for companies critical to efforts to fight the virus and its economic impact. The IDC’s immediate priority is to focus on sectors critical to limiting the spread and immediate impact of the virus and supporting supply chains critical for the economy. For an overview of the IDC’s response and the support being offered, please visit https://www.idc.co.za/2020/03/24/idc-interventions-in-response-to-covid-19/ or contact the IDC directly at 0860 693 888.
- The Department of Tourism has made R200 million available to assist SMEs in the tourism and hospitality sector and who are under particular stress due to the new travel restrictions. This fund, which gives preference to black-owned businesses, has specific conditions, including that businesses must have:
- an annual turnover of less than R2.5 million,
- been in business for at least one year,
- not been in distress before the Covid-19 disaster, and
- been fully registered with the CIPC and tax compliant.
- For more information about The Department of Tourism funds, please visit www.tourism.gov.za/AboutNDT/Ministry/News/Pages/COVID-19_interventions_for_the_tourism_sector.aspx.
Two initiatives were announced to specifically support employers and their employees; these include:
- A special dispensation for companies that are in distress because of COVID-19 and under which employees will receive wage payments through the Temporary Employee Relief Scheme, thereby enabling companies to pay employees directly during this period and avoid retrenchments.
- Employees who fall ill through exposure at their workplace will be paid through the Compensation Fund.
Various tax-related measures were announced:
- Tax compliant businesses with a turnover of less than R50 million per annum will be allowed to delay 20% of their pay-as-you-earn liabilities over the next four months along with a portion of provisional corporate income tax payments without penalties or interest over the next six months.
- SARS will also accelerate the payment of employment tax incentive reimbursements from twice-annually to monthly to get cash into the hands of compliant employers.
- A tax subsidy of up to R500 per month for the next four months for private sector employees earning below R6,500 under the Employment Tax Incentive.
- For more information in this regard, please visit www.sars.gov.za or contact SARS on 0800 007 277.
Businesses in the essential services category may apply for certificates on Biz Portal to continue operations during the lockdown period (https://bizportal.gov.za/essential_service.aspx).
Mercantile Bank remains open for business and we will continue to offer our clients all of our banking products and services during the lockdown period, including foreign exchange services, payment solutions, account opening, lending, and electronic banking services. As usual, please contact your relationship manager for assistance with all of your banking needs or make use of our digital channels, i.e. Internet Banking (www.mercantile.co.za) or our Mobile App (available on Android and iOS).
Acquisition of Mercantile Bank Holdings Limited and Its Subsidiaries (“Mercantile”) – October 2019
We are pleased to announce that the Minister of Finance and other Regulatory Authorities have formally approved Capitec’s purchase and acquisition of Mercantile Business Bank. This is an exciting timing for both Capitec and Mercantile and brings new opportunities for both Capitec and Mercantile, for our Staff, for Small Business Owners and Entrepreneurs; as we build Capitec’s Business Banking offering off the “firm foundation” of Mercantile.
Why did we purchase Mercantile? There’s an opportunity to offer a business banking solution, which is based on the same fundamentals that made Capitec successful in the retail banking sector, to any small business needing a no frills digitally lead banking solution. The acquisition of Mercantile will fast track the bank’s objective to expand its focus to a broader bank strategy.
Mercantile’s core business offer is banking for established small to medium sized enterprises and entrepreneurs. It is therefore well positioned to align with Capitec Bank’s business banking strategy. It was offered for sale by its shareholder, Caixa Geral de Depósitos (“CGD”), a Portuguese bank, because it is divesting from non-core operations outside of Portugal as part of its recapitalisation plan.
Next Steps For now, the two banks will be run independently with retail clients served in Capitec branches and Business Banking clients referred to Mercantile.
Our plan is to grow Mercantile Bank into Capitec’s Business Bank; we believe this will create exciting opportunities for both Mercantile and Capitec employees. Our need for skilled people will significantly increase to achieve this desired growth.
We’ll communicate further details as they become available.
Communications [email protected]
Withdrawal of Cheque products and services – June 2019
Johannesburg, 14 June 2019. We have received a directive from the South African Reserve Bank, communicated on 29 April 2019 to reduce the cheque limit from R500, 000.00 to R50, 000.00 with effect from 01 May 2020. This means, that clients may not issue or deposit a cheque in excess of R50, 000.00 at a time for the same payee, on the same day, by the same drawer in respect of the same invoice.
In light of this directive and considering the already significant decline in cheque usage across the banking industry, a decision has been taken to the effect that Mercantile will discontinue its cheque products and services – accepting and issuing, with effect from 01 December 2019.
We are able to offer alternative electronic banking solutions that are more secure, convenient, cost-effective, quick and more efficient for you to use. These include Internet Banking and Mobile Banking through our new user-friendly APP, Electronic payments – EFT, STP. Payments can also be made by using your Credit or Debit card.
Speak to your Business Manager or contact your nearest Business Centre to find out more about our electronic payment solutions.
Alternatively contact our Customer Contact Centre on 086 030 9250.
Portuguese Government approves the sale of Mercantile Bank to Capitec - November 2018
Johannesburg, 22 November 2018. The Portuguese Council of Ministers has today announced its approval of the sale by Caixa Geral de Depósitos (CGD) of its entire stake in Mercantile Bank to Capitec Bank Limited.
CGD, which owns 100% of Mercantile, is selling the bank as part of a strategic recapitalisation plan approved by the European Commission and requiring CGD to reduce its foreign assets. CGD was one of three Portuguese banks granted aid by the European Central Bank and European Commission in the aftermath of the global financial crisis of 2008.
Capitec, traditionally a retail bank, bid to purchase Mercantile Bank in a move to formally enter the business banking space.
Karl Kumbier, CEO of Mercantile Bank, says he is very excited that Capitec has chosen Mercantile as its partner to build the best business bank in the country – a very achievable goal since Capitec was recently ranked the top bank in South Africa and one of the top three in the world, according to the latest Lafferty global rankings. Capitec also received this year’s Sunday Times Top Company Award for the performance of its share price over the past five years and retained its top position in the Sunday Times Top Brands Awards in the retail banks category. “Capitec is a brand that is associated with hard work, innovation, and disruption. It is the fastest growing bank in the country and has over 10 million clients.”
Kumbier adds that the Mercantile team has worked very hard over the past few years to improve client experience and to grow the bank. “Through hard work, we have achieved great results in a tough economic environment and have been ranked number 1 in service for Business and Commercial Banking for four years in a row. Unfortunately, we can only grow so much organically and we need something new to take us to the next level. Hence, the timing of the sale could not be better and Capitec being selected as the preferred bidder is a fantastic result. I think Capitec will be an amazing partner. We are proud that a bank of Capitec’s stature has decided to buy Mercantile instead of trying to build a business bank from scratch.”
While the sale agreement remains to be signed by all parties involved and is subject to approval by the relevant South African regulatory bodies, Kumbier says the bank is looking forward to the next phase of its growth journey. “As an organisation, we are grateful for the guidance and support we have received from CGD over a long and successful relationship. However, we are very excited about the potential new opportunities we can unlock under the ownership of Capitec, a bank that has been bold in its strategy and focused in its execution.”
Kumbier adds that Mercantile’s experience and expertise in serving small and medium-sized businesses will bring great value in targeting this generally under-served market. "We believe that combining Capitec’s brand, its ability to scale, and its experience in disrupting the consumer banking market with Mercantile’s experience and skill in business banking will allow us to build a world-class business banking offering that will evolve to consistently address the unique needs of all South African entrepreneurs.”
About Mercantile Bank Limited
Mercantile Bank Ltd. was founded in South Africa in 1965 and is owned by Caixa Geral de Depósitos, the largest bank in Portugal and a global financial services group with more than 120 years’ banking experience. Mercantile Bank is a niche business and commercial bank that seeks to differentiate itself through great service and a deep understanding of the needs of the South African entrepreneur.
Mercantile Bank, while a niche bank, has a comprehensive set of products and services catering for the everyday banking needs of businesses.
While Mercantile Bank operates exclusively within South Africa, it has reach into other key African markets through its parent company and their subsidiaries in Angola and Mozambique. There is an ongoing focus on capturing trade flows between these fast growing economies.
Portuguese government announces shortlist of buyers for Mercantile Bank Holdings Limited - June 2018
The Portuguese government has approved a shortlist of four potential buyers to participate in the second phase of the sale process of Mercantile Bank Holdings Limited (“Mercantile”). This approval allows the sale process of Mercantile by Caixa Geral de Depósitos, S.A. (“CGD”), a Portuguese State-owned banking and financial services group, to progress to the next phase.
CGD has received 18 non-binding offers for Mercantile, the bank controlling company and sole shareholder of Mercantile Bank Limited (“Mercantile Bank”), a niche business and commercial bank which specialises in serving entrepreneurs. CGD announced its intention to sell Mercantile last year as part of a strategic plan approved by the European Commission, requiring CGD to reduce its foreign assets. Mercantile is 100% owned by CGD.
Pursuant to the recommendation of CGD, the Portuguese Government approved the shortlist of potential buyers after a thorough evaluation process by CGD and its advisors of the non-binding offers received.
The following potential buyers were selected based on the criteria set out in the Portuguese Decree-Law No. 153/2017 of 28 December 2017 which approved the sale process. The criteria included – amongst others – price, financial capacity and strategy.
- A consortium comprising Arise B.V. and Grindrod Bank Limited. Arise is an African investment company backed by the following shareholders: Norfund, a Norwegian investment fund for developing countries; FMO, a Dutch development bank; and Rabobank, a Dutch cooperative bank.
- Capitec Bank Limited. Capitec is South Africa’s largest retail bank based on the number of customers who use it as their main bank. It has a market capitalisation of over R101 billion and PSG Group as its largest shareholder.
- Nedbank Group Limited. Nedbank is the fourth largest bank in South Africa, ranked by assets. It has a market capitalisation of over R140 billion with Old Mutual plc as its majority shareholder.
- A consortium comprising Public Investment Corporation SOC Limited (“PIC”) and Bayport Financial Services (Pty) Limited. The PIC is Africa’s largest asset manager, managing public sector funds in excess of R1.9 trillion. Bayport Financial Services is one of the largest non-bank providers of unsecured credit and allied products in South Africa.
These approved potential buyers will now be allowed to conduct a due diligence process on Mercantile, including a full-day strategic engagement with Mercantile’s Board and management. This will be followed by the submission of binding offers. The entire process is expected to be finalised by the end of 2018, with the final approval by the Portuguese Government and with the completion being subject to South African regulatory approvals.
Karl Kumbier, CEO of Mercantile, says Mercantile is pleased by the quality of the potential buyers on the list. “I believe interest in Mercantile from companies of this calibre is not only testament to the quality of our business, but also of our team. It is their hard work and commitment which has underpinned our success and strong growth trajectory over the past 5 years. I am excited that each of these potential buyers could open up new opportunities for Mercantile and add great value to our business, just as we can add great value to theirs.”
He adds it is also an encouraging sign for the South African economy to see a foreign corporation member of a consortium selected as one of the final four potential buyers. “It is very positive for South Africa to see foreign players willing to make a long-term investment here. Their interest in Mercantile not only shows that they believe in the growth potential of our business, but also in the potential of the South African entrepreneurs we serve.”
Mercantile’s latest financial results for the year ending 31 December 2017 saw its net profit after tax climb by 20% to R213 million. This follows growth in net profit after tax of 21% in 2016 and 15% in 2015. Mercantile’s assets grew by 9% in 2017 to R13.4bn and deposits grew by 10% to R9.3bn.
Mercantile congratulates Trudi Makhaya - April 2018
Mercantile Bank would like to congratulate Trudi Makhaya on her appointment as economic advisor to President Cyril Ramaphosa and to wish Trudi well in her new role.
Trudi has been Consulting Economist to Mercantile since 2015, when she founded an advisory firm focused on competition policy and entrepreneurship. She has served as an advisor to several companies and has worked for Deloitte South Africa, Genesis Analytics and AngloGold Ashanti.
As an entrepreneur herself, Trudi truly understands the challenges and opportunities faced by small and medium-sized businesses in South Africa. As Mercantile Bank, we see her appointment as an encouraging indication that government recognises the importance of this sector in stimulating job creation and economic growth.
Mercantile Bank shows continued growth in 2017 - March 2018
Mercantile Bank Holdings Limited (Mercantile) has again delivered a solid set of annual results, posting double digit growth in net profit after tax for the third consecutive year.
Mercantile’s net profit after tax for the year to 31 December 2017 climbed by 20% to R213 million. This follows growth in net profit after tax of 21% in 2016 and 15% in 2015. Mercantile’s total assets have more than doubled since 2011 and grew by 9.3% in 2017 to reach R13.4 billion. At the same time, Mercantile’s deposits increased by 10% to R9.34 billion.
Karl Kumbier, CEO of Mercantile, says the company consolidated its growth during 2017 and each business unit exceeded targets for the year. Specifically, Mercantile Rental Finance continued its strong performance, increasing its assets by 33% to R918 million, and Mercantile Payment Solutions grew its net non-interest income by 26%, the Card division by 50% and the Foreign Exchange trading division by 21%.
According to Mr Kumbier, “these results show that Mercantile remains on the positive growth curve it has exhibited over the past few years. We have worked hard to develop a clear strategy for our business and to ensure we create an organisational culture to support it. I believe we are reaping the benefits of the investments we have made.”
Growing net non-interest income has been and will continue to be a key focus for the company; this is reflected in a second consecutive year of double digit growth in net non-interest income of 15% (2016: 16%) to R336 million in 2017.
The quality of Mercantile’s lending portfolio also remains sound with a credit loss ratio of 0.4%. Non-performing loans increased from 2.1% to 3.4% mainly as a result of one large exposure that went into Business Rescue in December 2017. Loans and advances increased by 9% to R9.5 billion during the year.
Kumbier says Mercantile will continue its focus on understanding and meeting the unique banking needs of entrepreneurs, including providing access to financing. In December 2017, Mercantile concluded a committed R740 million seven-year term loan with the International Finance Corporation (IFC), the main purpose of which is to enable growth in SME lending and, specifically, in black-owned and/or women-owned enterprises.
Mercantile is also one of only two South African banks to have been upgraded by Moody’s in 2017. The ratings agency placed Mercantile on positive review for a possible further upgrade. After climbing two notches, Mercantile’s crediting rating stands at Baa1.
The release of these annual results coincides with the current process by Caixa Geral de Depósitos (CGD), a Portuguese state-owned banking and financial services group, to sell its entire stake in Mercantile. It was announced in 2017 that CGD intended to sell its holding in Mercantile as part of a restructuring deal with the European Commission, which required it to reduce its foreign assets. Mercantile is 100% owned by CGD.
“We are optimistic that the sale will serve to further Mercantile’s strategy of becoming South Africa’s number one Business Bank. That said, stakeholder relationships form the core of our business philosophy and Mercantile’s board of directors is committed to only supporting a transaction that will benefit all of our stakeholders - particularly our staff and clients.”
IFC extends R740 million in finance to Mercantile Bank to expand its lending to SMEs - January 2018
The International Finance Corporation (IFC), a member of the World Bank Group, has announced that it will extend a seven-year R740 million term loan to Mercantile Bank Limited, allowing the bank to grow its lending to South African Small and Medium Enterprises (SMEs) and with a focus on women-owned SMEs.
This is a great opportunity for the bank as the loan will not only allow Mercantile to expand its own business, but will also enable us to help SMEs to sustainably grow their businesses and contribute more effectively to boosting productive economic activity and job creation. “A lack of access to finance is one of the biggest barriers to their success and ability to grow to create employment and wealth,” says Karl Kumbier, CEO of Mercantile.
According to the Global Entrepreneurship Monitor’s 2015/2016 country report on South Africa, in 2015, only six women for every ten men were engaged in early-stage entrepreneurial activity. This number was down from eight women for every 10 men in 2014. Unfortunately, this highlights that there remains a substantial divide between representation of men and women in the business world.
Karl Kumbier, CEO of Mercantile, says the bank’s sole purpose is to grow entrepreneurs and it is expanding this purpose to focus on supporting female entrepreneurs. “At Mercantile, we are already privileged to count a number of successful female entrepreneurs among our clients - we have worked with them and seen their businesses grow. This has led us to recognise the importance of providing financing to specifically help women take their businesses to the next level.”
Kumbier says early-stage entrepreneurs and other women involved in SMEs and business are steadily working to increase the level of female participation in the economy, but much more remains to be done to realise a more equitable economic future for the working female population of South Africa. He adds that while start-ups and micro enterprises make a vital contribution to addressing unemployment in South Africa, it is critically important to ensure the growth of established small and medium-sized businesses. “Established small businesses generate much-needed jobs and help to improve the lives of far more people than just the business owner.”
“It is so encouraging to see an institution like the IFC continuing to recognise the opportunity for growth in South Africa, despite the current tough economic climate in the country. Mercantile is also very proud of the continued confidence the IFC has shown in the bank over an extended period. This loan will not only allow us to assist other businesses, but also enable us to expand our own business further,” says Kumbier. Mercantile has doubled its lending to SMEs over the past five years and this loan will position Mercantile to sustain its growth momentum and reach its goal of being the number one Business and Commercial bank in South Africa.
Mercantile and the IFC have previously concluded a landmark securitisation deal (in 2014). The transaction valued at R240 million, saw the securitisation of Mercantile Rental Finance contracts and was the first of its kind in sub-Saharan Africa. Mercantile is also one of only two South African banks to be upgraded by Moody’s in 2017 and the agency has placed the bank on positive review for a possible further upgrade. After climbing two notches, the bank’s crediting rating now stands at Baa1.
Portuguese government gives go-ahead for sale of Mercantile Bank - December 2017
The official process of the sale of Mercantile Bank Limited by Caixa Geral de Depósitos (CGD), a Portuguese state-owned banking and financial services group, can now proceed following legal approval by the Portuguese government.
Mercantile is 100% owned by CGD, which announced in March 2017 that it intends to sell the South African bank as part of a restructuring plan required and approved by the European Commission. The reduction of its foreign assets forms part of a CGD agreement with the Commission.
Today the Portuguese Government, via its Council of Ministers, signed the decree-law required to begin the official process of privatising or selling an asset owned by CGD as a Portuguese state-owned entity. The country’s president now has to promulgate this decree within a period of 30 days, after which the formal process of selling Mercantile Bank will officially begin.
As part of this formal process, the interest parties will be brought into contact with CGD’s financial advisers which have already been appointed to facilitate the sale, namely the Deutsche Bank South Africa and Caixa Banco de Investimento Portugal.
The process will consist of different phases and is expected to take at least one year to complete. During that long process the Mercantile Board, CGD and ultimately the Government of Portugal will look into potential buyers which have a suitable ethical profile and reputation, as well as the ability to expand Mercantile’s business model through supporting its existing and future client base and the development of current staff and management.
Mercantile wishes to reiterate that its Board will only support a decision that benefits all of its stakeholders, the most important of whom are its staff and clients.
Karl Kumbier, CEO of Mercantile, says the bank is not reliant on any additional capital funding from CGD and the sales process should not affect Mercantile’s operations. “We will continue to focus on our strategy to become the number one business bank in South Africa. Mercantile is confident that we will find the right partner who will not only give us the opportunity to expand our own business further, but also to continue to grow the businesses of South African entrepreneurs.”
Over the past few years, Mercantile has already achieved outstanding results through the successful implementation of its growth strategy. As the largest of South Africa’s small banks by assets, Mercantile has seen its assets grow from just over R6 billion in 2011, to over R13 billion today. It also holds R9 billion in deposits, compared to deposits of R4.2 billion in 2011. This growth in the size of its business also coincided with increases in profit of more than 15% per annum over the past three years. Mercantile is also one of only two South African banks to be upgraded by Moody’s this year.