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Improvement in mortgages commended Print E-mail
Thursday, 25 September 2014

The National Credit Regulator (NCR) today released the ‘Consumer Credit Market Report’ (CCMR) and the Credit Bureau Monitor (CBM), which are based on the data submitted to the NCR by registered credit providers and credit bureaus respectively. This latest edition of the reports covers credit market information up to June 2014.

New credit extended for mortgages grew by R2.3 billion (7.6%) when compared to the previous quarter and R3.08 billion (10.25%) when compared to quarter ended June 2013. The value of the mortgages debtor’s book was R834 billion as at June 2014 which amounted to 53.18% of the total debtor’s book. A total of 90.62% of the mortgages repayments were up-to date as at June 2014. Nomsa Motshegare, CEO of the NCR, commended the latest trends in consumers seeking assets building credit. She also encouraged consumers to know their credit status, to live within their means and to use credit responsibly.

The total value of new credit granted increased from R105.60 billion for the quarter ended March 2014 to R107.19 billion for the quarter ended June 2014, a quarter-on-quarter increase of 1.50%. There was an overall quarter-on-quarter growth for all credit types with the exception of “developmental” credit which declined. The number of applications received for credit increased by 696,000 from 9.67 million in March 2014 to 10.37 million in June 2014, a quarter-on-quarter increase of 7.21%.

The following were some of the most significant trends observed in terms of credit granted for the quarter ended June 2014:

·       The value of new mortgages granted increased by 7.60% quarter-on-quarter from R30.84 billion to R33.18 billion.

·       Secured credit, which is dominated by vehicle finance, increased from R35.35 billion for March 2014 to R35.76 billion for June 2014, a quarter-on-quarter increase of 1.14%.

·       Credit facilities, consisting mainly of credit cards, store cards and bank overdrafts, had an increase of 2.31% quarter-on-quarter from R16.22 billion to R16.59 billion.

·       Unsecured credit increased from R18.82 billion for March 2014 to R19.32 billion for June 2014, a quarter-on-quarter increase of 2.64%.

·       Short-term credit increased from R1.23 billion for the quarter ended March 2014 to R1.29 billion for the quarter ended June 2014, an increase of 4.75%.

·       Developmental credit had a quarter-on-quarter decrease of 66.53% from R 3.14 billion to R 1.05 billion.

As at June 2014, the total outstanding consumer credit balances (or gross debtor’s book) was R1.57 trillion, representing a quarter-on-quarter growth of 1.16% and a year-on-year growth of 6.96%. The trends for outstanding balances for the quarter ended June 2014 were as follows:

·       Mortgages debtor’s book increased from R823.33 billion for the quarter ended March 2014 to R834.37 billion for the quarter ended June 2014, an increase of 1.34%.

·       Secured debtor’s book, which is dominated by vehicle finance, increased from R331.72 billion for March 2014 to R340.36 billion for June 2014, a quarter-on-quarter increase of 2.60%.

·       Credit facilities debtor’s book, which consists mainly of credit cards, store cards and bank overdrafts, had a quarter-on-quarter increase of 2.45% from R190.58 billion to R195.26 billion.

·       Unsecured credit debtor’s book decreased from R172.97 billion for March 2014 to R172.20 billion for June 2014, a quarter-on-quarter decrease of 0.45%.

·       Short-term credit debtor’s book decreased from R707.34 million for the quarter ended March 2014 to R704.99 million for the quarter ended June 2014, a decrease of 0.33%.

·       Developmental credit debtor’s book decreased from R31.67 billion for the quarter ended March 2014 to R26.10 billion for the quarter ended June 2014, an decrease of 17.58%.

The banks’ share of the total outstanding consumer credit as at June 2014 was R1.33 trillion (84.60%), retailers was R36.29 billion (2.31%), non-bank vehicle financiers at R58.45 billion (3.72%), and “other credit providers” at R146.92 billion (9.36%). Other credit providers consist primarily of pension-backed lenders, insurers, non-bank mortgage lenders and securitised debt.

Credit bureaus held records for 22.12 million credit-active consumers, an increase of 1.9% when compared to the 21.71 million in the previous quarter. Consumers classified in good standing increased by 65,000, to 12.17 million consumers. As a percentage of the total number of credit-active consumers at 55.0%, this reflects a decrease of 0.8% quarter-on-quarter and an increase of 3.0% year-on-year.

The number of consumers with impaired record has increased by 343,000 from 9.60 million to 9.95 million. As a percentage of the total number of credit-active consumers at 45.0%, this reflects an increase of 0.8% quarter-on-quarter and a decrease of 3.0% year-on-year. The number of accounts increased from 77.18 million in the previous quarter to 79.42 million. The number of impaired accounts increased from 19.27 million to 21.28 million when compared to the previous quarter, an increase of 2.01 million quarter-on-quarter and 2.41 million year-on-year.

A total of 365.76 million enquiries were made on consumer credit records, an increase of 9.6% quarter-on-quarter and 1.6% year-on-year. Enquiries initiated by consumers accounted for 15.26 million of all enquiries, an increase of 6.5% quarter-on-quarter and a decrease of 4.1% year-on-year. Of the total enquiries made on consumer records, enquiries from banks and other financial institutions accounted for 83.5%, enquiries from retailers accounted for 4.5% and enquiries from telecommunication providers accounted for 2.9%. Banks and other financial institutions’ enquiries increased by 9.9% from the previous quarter, retailers increased by 38.2% and telecommunication providers increased by 20.2%.

The number of credit reports issued to consumers increased to 210,669. Of the total credit reports issued, 64.4% (135,650) were issued without charge, and the remaining 35.6% (75,019) were issued with charge. There were 21,339 disputes lodged on information held on consumer credit records for the quarter ended June 2014, a decrease of 14.7% quarter-on-quarter and an increase of 13.6% year-on-year.

(Source - NCR Media Release)
 

 

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