Our opinion on the current state of SASFIN(SFN)
Sasfin (SFN) is a banking group specializing in various types of finance for small businesses and high net-worth individuals. It was listed on the JSE in 1987. The company has been heavily investing in its digital platforms and acquisitions. The share was in a strong downward trend, and investors were advised to wait for a measurable turn in the price, such as an upside break through its long-term trendline, before investigating further. This break has not yet occurred, mainly due to the impact of COVID-19, though there are signs that the share is beginning to recover.
On 16th October 2023, the company announced, "Sasfin has entered into binding heads of agreement to dispose of its capital equipment finance and commercial property finance businesses to African Bank Limited." This caused the share price to rise sharply.
However, on 27th February 2024, Sasfin announced that it had received a civil summons from the South African Revenue Services (SARS) for a damages claim of R4.782 billion plus interest and penalties related to income tax, value added tax (VAT), and penalties allegedly owed by former foreign exchange clients of the bank. Sasfin has a market capitalization of just R484 million.
In its results for the six months to 31st December 2023, Sasfin reported headline earnings per share (HEPS) down 62.39% and net asset value (NAV) up 4.09% to 5191c per share. The company attributed the decline to negative adjustments to the group's fair value loans and private equity portfolio, as well as an increase in credit impairments due to the challenging economic environment for businesses in South Africa.
In a trading statement for the year to 30th June 2024, Sasfin estimated that it would make a headline loss of between 181.41c and 200.5c, compared to a profit of 366.18c in the previous year. The expected loss is due to increased expected credit losses, negative fair value adjustments, and high once-off costs, including a provision for administrative sanctions.
The share is fairly thinly traded, with only about R85,000 worth of shares changing hands on average each day. On 15th July 2024, Sasfin announced its intention to delist from the JSE. Shareholders will be offered R30 per share, which represents a 66% premium to the 30-day volume-weighted average price (VWAP) as of 12th July 2024.
On 16th October 2023, the company announced, "Sasfin has entered into binding heads of agreement to dispose of its capital equipment finance and commercial property finance businesses to African Bank Limited." This caused the share price to rise sharply.
However, on 27th February 2024, Sasfin announced that it had received a civil summons from the South African Revenue Services (SARS) for a damages claim of R4.782 billion plus interest and penalties related to income tax, value added tax (VAT), and penalties allegedly owed by former foreign exchange clients of the bank. Sasfin has a market capitalization of just R484 million.
In its results for the six months to 31st December 2023, Sasfin reported headline earnings per share (HEPS) down 62.39% and net asset value (NAV) up 4.09% to 5191c per share. The company attributed the decline to negative adjustments to the group's fair value loans and private equity portfolio, as well as an increase in credit impairments due to the challenging economic environment for businesses in South Africa.
In a trading statement for the year to 30th June 2024, Sasfin estimated that it would make a headline loss of between 181.41c and 200.5c, compared to a profit of 366.18c in the previous year. The expected loss is due to increased expected credit losses, negative fair value adjustments, and high once-off costs, including a provision for administrative sanctions.
The share is fairly thinly traded, with only about R85,000 worth of shares changing hands on average each day. On 15th July 2024, Sasfin announced its intention to delist from the JSE. Shareholders will be offered R30 per share, which represents a 66% premium to the 30-day volume-weighted average price (VWAP) as of 12th July 2024.
Aviso legal
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