South Africa Banks: Resilient operating backdrop in Jul-26

We review the latest BA900 data for Jul-26, which suggests a still supportive operating backdrop for South African banks despite some moderation in aggregate growth trends, with sector loan growth and total funding growth at c.+9% yoy. Lending momentum remained relatively resilient, with corporate and retail loan growth at c.+10% and c.+5% yoy, respectively. Within retail, installment finance remained the fastest-growing segment at c.+10% yoy, while mortgages, credit cards and unsecured lending growth remained in the c.+3-5% yoy range. At the bank level, FSR continued to outperform peers with c.+12% yoy loan growth, supported by stronger corporate lending, while SBK delivered the strongest funding growth. While a further rate hike in 3Q26 could create some pressure on borrowers, management teams generally indicated that they are not seeing signs of deterioration in retail asset quality at this stage. Instead, any increase in credit costs is expected to be primarily driven by wholesale