FirstRand Bank Limited - Nasira Portfolio
Status: Approved investmentWhy disclosure?
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Disclaimer
The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.
Who is our customer?
FirstRand Bank (FRB) is one of South Africa's top five banks, and the second largest by market share (22%), with total assets of ZAR 1.6 trillion (USD 93 billion) as of December 2022. It is a wholly-owned subsidiary of the FirstRand group (FSR). FRB benefits from strong financial performance, qualified management, and high ESG standards. The bank operates through 611 branches with 40,000 employees and divides its lending between retail (47%), corporate (37%), and commercial (13.5%) sectors. FRB is recognized for its micro-, small-, and medium-sized enterprise (MSME) strategy through its FNB brand, which offers attractive deposit propositions and a convenient digital platform for transactional and small business loans. In August 2023, FNB won seven awards at the 2023 World’s Best Consumer Digital Banks in Africa by Global Finance, highlighting its leadership in digital innovation. FSR has a diversified shareholder base, including pension funds (24%), unit trusts (34%), and insurance companies (6%), with 52% of the shareholders based in South Africa. FSR also owns five interim holding entities that account for 10% of its assets and revenues, covering African, UK, insurance, investment management, and specialty businesses.
What is our funding objective?
Hypoport, the FMO partner for Nasira-related data integration and reporting, will provide FirstRand with additional features to capture social impact data on Black Economic Empowerment (BEE) and township entrepreneurship through this project. This is pivotal for the success of the risk-sharing facility. Through this grant, FirstRand Bank is receiving support to enhance its monitoring system for the MSME portfolio management. Therefore, through this project, Hypoport will strengthen the monitoring capabilities, data accuracy, and impact reporting of FirstRand Bank.
Why do we fund this investment?
The Nasira guarantee aims to support FRB to widen its risk appetite for MSME entrepreneurs, especially those residing and working in township economies. Townships are historically segregated urban areas where businesses are predominantly informal and financially underserved. The potential impact is huge, but the bank lacks the technological means to capture social impact data to be able to report back to FMO on inequalities reduced based on historical loan origination and portfolio performance data. Currently, South African entrepreneurs residing in townships are severely underserved. Getting better quality data, reporting, and monitoring systems allow the banks to better understand the risks and opportunities this socio-demographic segment offers and therefore to better serve it. FMO’s financial support is crucial to ensure adequate impact monitoring tools are in place, and Hypoport will build additional features to the system it usually provides to FMO clients to capture this. In addition, the consulting services will enhance the FirstRand systems to manage its Nasira portfolio and report to FMO on portfolio performance.
More investments
| Date | Total FMO financing |
|---|---|
| 7/2/2024 | ZAR 847.29 MLN |
| 7/2/2024 | ZAR 32.41 MLN |
- Website customer/investment
- https://www.firstrand.co.za/
- Region
- Africa
- Country
- South Africa
- Sector
- Financial Institutions
- Publication date
- 4/17/2025
- Effective date
- 3/5/2025
- Total FMO financing
- USD 0.05 MLN
- Funding
- FMO NV
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Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C) - A