Moody’s upgrades Mercantile Bank two notches up despite tough economic
conditions in South Africa

This month, Moody’s Investors Service raised Mercantile Bank’s long- and
short-term national scale ratings to from

The ratings agency gave Mercantile Bank a “stable outlook in view of its
robust financial performance, which supports its ability to withstand the
potential pressures stemming from the current economic slowdown in South

This rating reflects Mercantile Bank’s small but growing franchise – 0.2%
in terms of total assets – in South Africa. It also considered that the
bank’s credit loss ratio has been relatively low in recent years compared
to other banks, standing at around 0.55% in 2015 and further improving to
a reported 0.46% for the first six months of 2016.
This is against the backdrop of the bank’s 2016 annual results, which show
· Total assets grew by 22% to R12.2bn,
· NPAT grew by 21% to R177m,
· Lending grew by 20% to R8.6bn,
· Deposits grew by 26% to R8.4bn, and
· Long-term funding grew by 30% to R838m.

Mercantile Bank’s client base has expanded and broadened in recent years
driven by deposit growth. It has also improved its financial position over
the past few years through its successful strategic focus on business
banking clients (with turnover up to R60 million) and commercial banking
clients (with a turnover of more than R60 million per annum).

Mercantile Bank prides itself on being a small bank with big bank
capabilities and on its ability to offer exceptional relationship-based
service to entrepreneurs.

This credit rating evaluation supports the Bank’s strategy and above all,
its depositors and creditors.