Capitec Bank Holdings Limited (CPI) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. It's a great privilege for me to bring you the results for Capitec for half year. I think if I look at the last 6 months, a couple of things stands out. I think we had a very strong performance overall. I think the second word that comes out is, the whole impact of digital -- going digital, then our ability to be agile. I think with COVID as well as with the unrest, we've been extremely agile. And then announcing the client experience for all clients, was a big focus for ourselves. And I'll sum that up or I'll go into much more detail in the presentation on that. If anyone of you want to think questions, there is the e-mail address that you can send through, and Andre and myself will handle that after my presentation. If I look at South Africa, I would like to start with the socioeconomic landscape, and maybe discuss that in detail. I think let's start with the positive things. I always believe one needs to be positive, and I think it's part of our success in Capitec, is that we're looking for those positive things and trying to get and look for opportunities. I think if you look at the positive side, we had very strong community boom in South Africa in the last year. I think that had a big impact on the sales revenue that came in. But it also shows you in the last week of what has happened in China, how volatile that could be and the pressure that it's suddenly putting on to communities and then also onto our exchange rate. If I look at current account, we had a very positive current account, very low inflation and interest rates are at lowest ever for a very long period. I think everyone is talking, when is interest rates going to go up and what this going to happen with inflation. But I think that had a very positive effect in South Africa, and the one that excites me is, basically, I believe about -- before COVID, government believed they can do everything themselves. But in all our meetings lately, it's more about how can government and private sector work together, and we've seen it what has happened in [indiscernible], in investments there. I think on the energy side, there's big movement. So I think that is quite exciting. If the private sector and government can work together to optimize South Africa. I think the other one that stands out for me, is the resilience of the South African companies. If you are going to look at the results of companies in the last 6 months. Actually, given COVID, I think everyone has done much better than what we anticipated. I think everyone -- when COVID happened, everyone, we're talking about a 38%, 39% unemployment. Yes, at 34%, but it's much better than we anticipated. And there is growth coming through. And I think our individuals, a South African citizen is a strong person that actually can withstand pressure and what's happening, and I think we mustn't underestimate that. And I think the one that stands out for me, is actually during the civil unrest. I never thought that I would actually be in a situation, where you actually say thanks to the taxi owners, because they saved quite a lot of buildings and shopping malls, and how the communities stood together and protected properly and how the community went out there and cleaned and operated. I think that just shows you about the South African culture, in the way we can react, if we work together. Uncertainty. Yes, I think everyone talks about vaccinations. We very pro-vaccinations. We encourage people to take COVID vaccinations at Capitec. We've got a whole program to encourage our people to take up at our head office, about 70% of our people has been vaccinated. And we're driving that. So the question is, the whole of South Africa, we need to get 30 million people vaccinated, and we need to make certain that we don't have a next wave, so that we can get back to normal. I think the exit and shortage of critical skills, I think it's a big area that we need to address. Young South Africans are leaving South Africa. They're worried about job opportunities. They're worried about unrest that's taking place. And I think we need to give direction to them ourselves. There's also a big shortage on critical skills and I really believe our education system really need to look at that, because our education system is not producing the people that we need for going forward in South Africa. We need engineers. We need CAs, we need business, science people. We need AI people, and our education system is not bringing that about. I think COVID, the inequality, that has just widened, and I think that's going to have a massive impact going forward. And the one that I'm more worried about is, this whole social grant culture versus a culture of entrepreneurship and ownership and especially being entrepreneur and being ownership, I really believe our government and ourselves, must encourage our people to go out there and become entrepreneurs and ownership. Social grants is not a long-term solution. Then government's role. I think the most important for government is to give great clarity, confidence. We can't have where one minister says this and other minister says that. And then the important thing is to execute, execute on strategies rather, and I've seen it in our business, rather have a strategy executed, and if it's wrong, correct that, but we're just talking. So we need that clarity and business confidence, so that we can invest, and I'll show you later on what is happening on the savings side. There is money in South Africa to go and invest. And then the long-term impact of COVID and the July unrest. It's interesting when I talk to our overseas people. We all know about massive packages that's been made available in America, Europe etcetera, etcetera. And the question I always ask is, how are you going to repay this? And what is that going to -- what impact is that going to have on our economy? So I think there's positive sides, and there's uncertainty. Our government has got a massive role to play, to make certain that we've got the clarity and execution. If I look at the unrest, I think we've never spoken about it. But if you look at Capitec, 79 branches were impacted. Of that 11, damage was fairly low, but 68 branches was destroyed completely. So they were wiped out. And we're rebuilding it. We should have about 80% of those branches rebuilt by November. And then, close to 300 of our ATMs were completely destroyed. Interesting is, and you never think about it, during that unrest period, our biggest challenge was to how do you safeguard the cash and our ATMS? There was about 10 days or 2 weeks that we couldn't have been able to go to those branches, and we've lost ZAR 36 million in cash during that period. Our damage to our infrastructure, about ZAR 300 million. So the client that's going into [indiscernible] ZAR 300 million. We haven't received anything, but the expenses is coming through already in this half year results. Just coming back, what happened during that period, it was for us all about the safety of clients and the safety of our people, our staff. So those branches were closed. We didn't trade for a long period. And then interesting, for the first time, we had to make certain that our staff and even our clients has got food, because supermarkets, et cetera, et cetera, was closed. So we distribute over 5,000 food parcel and a food parcel would be able to keep you with enough food for a week, to all our staff. And it was quite a logistic challenge to get it out to KwaZulu-Natal and Gauteng, but it was a big focus. And then yes, there's close to 1,000 service consultants that we had to reallocate. We reallocated some of them to our branches, about 300, 400 were reallocated to branches. And then our flexibility came out, because these guys are sitting at home, but they're operating in our call centers on our direct lending environment. So that multi-skilling coming out, the ability to actually use those people in different areas. I'm worried about the long-term business confidence in KwaZulu-Natal, what is that long-term impact going to be? So I think that's the economy. Just maybe a question that will come out, what is the impact on Capitec? On the credit side, I'll touch on [indiscernible], the effect was less than 1%. And our KwaZulu-Natal branches is operating at normal capacity, less about 25%. So at about a 75% capacity. Gauteng is actually operating 100%. If I look at our financial highlights. Yes, I think it's quite pleasing to go from, let's call it, round figures, August '19, ZAR 2.9 billion, to close to ZAR 4 billion. I think to be able to sit and say that in a 2-year period, we had growth of 35.5%. So if you take it per year, it's a growth of 16% per year. I think that is extremely good performance. There's not a lot of companies that can say that, to go through COVID, handle COVID and still show growth over a 2 year period of 35% is extraordinary. We're paying out a dividend of ZAR 12. And then, in the sense, we've said that the intention of the Board is, that we will do our dividend ratio to increase that from 40% to 50%. So I think that is quite positive. If I look at our results, our income statement, I think net lending income is up 7%. Our interest income is down 2%, and that's predominantly because of the repo rate that dropped to 2.75%. And then a big switch from the term loans to the access facility. The access facility on average is about 5% lower priced than the term loans, and that is to acquire better quality clients. And then you add the effect, last year, we pulled back quite a lot, and you lost that credit income coming through in this year. So interest income negative, but we're quite confident, and I'll go through it later on point, that it will be a positive going forward. And then on the investment side, we managed to invest better in government bonds, etcetera, etcetera, to have a better return on that side. I think the one that highlights is the transactional income, up 33%. So that is, I believe, very strong to grow over -- in a year's time with 33%. And I'll just show you how strong it is, and still amazing, the amount of new clients that we're still acquiring. Funeral plan at 5% growth. It's purely a function of the claims, and that will impact that. So income from operations is 17%. And I think that probably the one that surprised everyone was, the operating expenses. I don't think everyone expected the operating expenses to go through. Maybe just before I go to the operating expenses, there is that ZAR 71 million. That is -- we've written on the assets that we've lost in KwaZulu-Natal, that's about ZAR 109 million. The ZAR 71 million is after tax. And then there's ZAR 36 million in the OpEx about the cash, which I already referred to. Then, we had a massive increase in our share appreciation rights. Our share price went from ZAR 800 to ZAR 1,900, that's about ZAR 250 million. And then you add bonuses. We didn't buy any bonuses in August last year. We've provided for the bonuses for half year already for this year. And then there was investment in cloud and machine learning, as well as the mercantile people that's coming on board. So very much in line with our expectations, if you look at the half year results, that figure is actually below our budget. If I look at the income ratios, very strong income ratios. We're basically covering all our OpEx through our net transactional income and funeral income, and one that stands out for me, if I look at our net transaction and funeral income to net income at 51%. So what we're basically saying is that, our other income is starting to become bigger than our credit income, and that gives you opportunities to grow. And then the cost-to-income ratio, that is 44.6%. If you look at the specific figure, if I take out the riots of ZAR 140 million, and I take out the share appreciation rights and certain of other bonuses that dropped to about 42%. February, we were at 41%, and it's our aim to make certain that, that ratio gets back to 40%. In capital adequacy, yes, I think you can see the very strong capital, gives us a lot of opportunities to grow the business, and that growth from 30% to 37% is basically retained income. But a 37%, capital adequacy gives you lot of confidence on how strong we are on our balance sheet. Drivers of those earnings; I think a couple of figures, I think it's actually quite interesting, if you look at our client growth. If you look at from August '18 to '19, it's 2 million. If you look for August '19 to '20, it's 2 million new clients. If you look at August '20 to '21, that's another 2 million clients. So it's quite scary on how the brand has been accepted and how the brand is growing, because to add 6 million clients over a 4 year period, I think that's an incredible achievement. The very other strong one is our digital side. Our digital side increased with 1.6 million clients from 7.3 million to 8.9 million clients. Then our savings side is 5.5 million to 6.3 million. So 6.3 million of our clients that's on fixed-term or fixable saving product. Funeral, you can see that steady growth, 1.5 million active policies and then you can see on the credit side, there's an uptick of 100,000 clients, and that is purely due to access facility that is acquiring quite a lot of new clients. Interesting again, everyone's perception is, we're giving credit to everyone, but only 1.1 million clients of the 16 million has got credit reversal. So just to make certain that everyone got the perception on how strict we are on the credit side. If I look at digital, we've been voted the best digital bank in South Africa and we're very proud of it, and it's something we drive very strongly. I think if you look at -- there's a strong shift also from the [indiscernible] to app. Our app clients is now 6 million, up 46% and the one that COVID has got a big impact on, is online shopping. We've got over 1 million clients to -- that's using the app to do online shopping and I think that figure is just going to grow, grow as we're going forward. It's interesting if you look at the stats, the app logins, basically, all of these figures are greater than 100% growth. App logins, 840 million logins over a 6 month period. So it's over 120 million log-ins per month, people going into the app. The number of transactions, ZAR 600 million. You will ask why the transactions is less than the login for the transactions, we only count transactions where we earn income. So balance enquiry, we don't count. So that's why there is that difference. And then tap to pay is starting to grow very nicely, with 34 million transactions, and I'll elaborate on that later on. And then RTC, real-time clearing, we've got a 37% market share in the market, and that is growing very strongly. And that is for us, is our answer to moving people away from cash, because our RPC is priced at ZAR 7.50 per transaction, makes it very attractive to be able to pay a person, and that person have got that money immediately. On simplicity, affordability and transparency, our fee structures, I still believe it's the most affordable and simplistic and transparent. I think you can see there, the transactions, that's for free. Electronic payments on the app, EFT transactions is ZAR 1. And then ZAR 750 to draw cash and do RPC, and then you've got a ZAR 5 monthly fee. So that's your fee structure. Very simplistic, very transparent. And there's a couple of nice things that we're looking at, to even give more value to our clients going forward on the transactional fee income. This is just how the transactions has moved. COVID, because I think it's interesting to look at that. I'm going to start off with February '20. We did about 600 million transactions per month. You can see COVID, it has dropped down to about 500 million transactions. And then you can see August '21, we had 750 million transactions. But you can see what happened is this big -- the percentages may be don't display it. But if you look at how big that blue bar, as you can see, how big transactional digital is, and you can see how strong the card swipes, card payments is going through. And I think a big driver of that is the ability just to tap your card and make a payment. So very strong growth from 35% to 41%. And then cash is coming down. It's just interesting, if you look at the August '21 figure on value, cash is still the highest at ZAR 1.9 billion, digital at ZAR 1 billion and then card at ZAR 800 million. So that just gives you an implication of the value of transactions that's taking place. If I look at credit life insurance, the roadmap, everyone asks us what is happening, and a lot of things has changed with COVID, we are always using Guardrisk to help us with our insurance. And suddenly, in May last year, we had no cover. Nobody wanted to take on the retrenchment risk, as well as the death risk given COVID. So we had to increase our premiums in May. We increased it to -- for government ZAR 4 per 1,000 and nongovernment of ZAR 4.50 per thousand. We managed to get this renewed in August 2020 and then -- oops, and then in May, the date was expired -- on credit, we're fully self-insured. And then in August, we reduced our prices on insurance, because we are seeing a better performance coming through. So our rights are now ZAR 2 for government and ZAR 4 for nongovernment. What is interesting, you can see the retrenchments, it spiked in November through 14,000 claims for that particular month, or 15,000 claims. And then you can see on the debt side, how it's actually -- how it's planned. Interesting, if you look at the August '21 figure, which is not included in there, there's still 2,000 clients that need to be processed. So that August, May figure you actually did increase by 4,000. But you can see we're starting with retrenchments. We're starting to get back to normal levels, 4,500 versus, if you look at November '19, February, around about 4,000. And if you look at the debt flowing, even it's starting to get normal. So I think now with level 3 that that's going normal, we should see that returning to normal implications. If we look at the funeral income, still a very strong performance. Our profit up ZAR 360 million and it looks like every 6 months, we do a profit of ZAR 360 million, if you just go back in the history. We've sold more than 600,000 policies and it's interesting how the policies is still 600,000, but the average premium has increased from 18 months ago from about 190 to 238. And it's also a drive. We had a lot of questions from analysts on book persistency, and what we're definitely seeing is, in the beginning, our persistency, which is at about 40%, is pulled back because of lower income clients and their persistency rates are extremely low, around about 20% to 25%. So we're working on to make certain that we're selling the right policy to the right client. And then you can see the claims ratio with COVID. You can see how that is peaking. But we still are very positive about the product. You can see it has gone through 3 waves, and we're still profitable over that. So it's a big focus for area for us going forward. And we're still the market leader with the highest cover and the lowest average premium, and 18% of all new policies sold is done by Capitec. So yes, I think that's the interesting one. We've been in COVID and we've been in riots. But if you look at the BA-9 and you look at South Africa in totality, we had saved in 2020, 2019 ZAR 2 trillion. That's gone up to ZAR 2.4 trillion, 18% growth. So there's ZAR 400 billion that's been saved. And you would have thought given COVID and that we have to support everyone that, that money would have moved out. So that's why I'm saying if the government can create confidence, clarity, this money can go back into the private sector and can go into the economy. So there's a big opportunity. We've increased our market share with 1.4%, and I think it's just the strength of the brand and then we're acquiring more and more people of the age of 55 and plus, and high income clients that is giving us that ability to grow that. We've paid ZAR 2.1 billion in interest out to clients, still one of our big positioning statements, if you -- from the first cent you put in our savings account, you are getting an interest from 2.25% to 8.15%. Then credit, I think this is one that I think we've managed extremely well. If we look at the capital advance, you can see that we're now back to pre-COVID levels. We're advanced in August '19, ZAR 18 billion. That's up to ZAR 20 billion in August. So we're ZAR 2 billion higher, and we've gone up from ZAR 12 billion to ZAR 18 billion. And if you look at the provisions, you need to remember on that ZAR 8 billion, there is that upfront provisioning of between 5% and 8%, which is about a ZAR 500 million effect on those provisions. And you see the strong growth on the book. I think on pricing, we still -- on clients that actually -- who do not bank with us, but has got a Global One account, pricing is about 17% lower than our position. And then we've made the brave step for our top end clients to go to repo. So our top line clients unsecured, gets a rate of 7%. I don't think there's a lot of people that says that their models are strong enough to go unsecured at 7%. If I look at reschedules, are booked back to normal levels. You can see our reschedules before COVID was ZAR 2.5 billion, and has gone up to over ZAR 10 billion. We're back at ZAR 3.3 billion and if you take off the ZAR 40 million of reschedules for the unrest, we had ZAR 2.9 billion. So it's very much in the same ballpark figure. I think the whole behavior incentive that we've done, has worked out extremely well. We've paid out close to ZAR 200 million in the last 6 months. So you can see a very strong performance from that side. And then our arrears, we had -- in August '21, we had an industry problem on DebiCheck, which had an effect of about ZAR 250 million on our arrears. If I look at the September figures, it's back to normal. So that's why I've got that profit line there. And you can see our arrears are basically 3.7% versus 3.6% in August '19. So our arrears are actually back to normal levels, which I think is an extremely positive trend. If I look at the access facility, I think it's one of our better products, and we're very proud of it. It has gone now to 32% of our capital advance. And maybe just to unpack on how that product is working. If you use it, you pay ZAR 50 or ZAR 60 per month on your monthly fee. If you don't use it, there's no monthly fees. On your application, your initiation fee is from ZAR 100 to ZAR 300, a maximum of ZAR 300. If you take a term loan, it's normally 10% of the lending amount up to ZAR 1,000. And if I look at the pricing, the credit card is priced at 7%, from 7% up, and access facility is priced from 12%. The ROE on the access facility is lower. We started a couple of years ago, with the experiment of 20% ROEs and to see what impact that has got on higher income clients. The access facility is priced at 20%, and that's why we're seeing a big driver on quality clients that's coming through. Interesting on the behavior though, people are using the access facility. And last year, we were at 59% of the access facility that's been used. Only 49% of facility has been used. You can see how conservative the people are using access facility. And then the interesting one, because everyone thinks we're just swapping the term loan to access facility. The clients that consolidated their term loan and switched to access facility, is smaller than 11%. The majority of people are new credit clients or people that had credit with us, had a breakthrough period, and are now coming in to take up the access facility. And then on risk management, only 27% -- smaller than 27% of our applications are approved. And then daily risk management. We've got the ability to look at your exposure on the access facility, and if we see risk, we can actually reduce the term or the rand value and 13% of our limits has been reduced, making certain that we can manage the risk of the access facility. What is happening with the clients? If I look at our performing book, you can clearly see -- what we're doing here is let me explain it. This is our performing clients in our performing book. We're looking at cash stress. What we're saying, if you earn ZAR 100 and your commitment is more than ZAR 80. So you've got less than ZAR 20 left on your salary. We say you are in cash stress. So it's a very good indicator, if there's stress in the economy, because those people that only got less than 20% left on the income, somewhere they're going to fall short. And we're seeing a massive improvement on all industries, if you look at August '20, last year, and August '21. And the one that actually surprised is if you look at travel and leisure, that has dropped from 27% to 13%. I think what also helped us here quite a lot, is that pullback in the lower incomes, because they were the most -- so we did that already in 2019, as well as small and tiny companies, we've pulled back quite a lot, and that is what you're seeing here. So our clients are actually performing much better than anticipated. Then the one that we're seeing now is debt review. It's interesting, if you look at debt review, the number of clients of our book, is below 3 -- 0.3% of it. But we're starting to see an increase in debt reviews, especially in government. And that's normally where people are under stress. No alarming signs yet, but it's starting to creep up. We've already adjusted our credit policies to take that into consideration. So we've got profiles of clients, which we believe will go into debt review, and we've already pulled back in those particular area. And then the one thing that I think gives us a bit of reality in South Africa, I'm going to first talk about household dependence. That's where -- and its predominantly young people, and this study was done by Old Mutual. That's where young people has got dependents, other people that they need to look after. And what is interesting, that has grown from 35% to 51%. So a big percent of our people in South Africa is actually -- need to look after at somebody else. And we see it in our consultants, young generation between age of 20 and 30, and they've got dependents that they need to look after, and when we look at our own staff and we look at their financial health, we're actually seeing exactly the same. And the one that I've never heard of, but you're never too old to learn, is the sandwiched generation. And that's where you, as a person needs to look at younger people and older people. And you can see that increased from 34% to 43%. So there's for sure, still, if we don't get the economy growing, there is pressure on the South African household. And I think it's -- if you lose 1 million jobs, this is a result that you're going to get. If I look at our credit loss ratio, coverage of our provisions. You can see a very strong graph. We're basically back to about a ZAR 2 billion level and remember, in that ZAR 2 billion level, is that extra ZAR 8 billion that we've sold, if you compare this year with last year. So we're back to normal level. And if you look at your ECL ratio, you can see it's gone up to 28% and we've brought it back to 26%. In our sense, we're saying we're still holding back about ZAR 2.2 billion for economic forward-looking, that we need to have certainty before we will release that. So that is why -- that's basically the gap between the 26% and the 20%. So I think overall, a very strong performance on the credit side. Business banking; the whole migration or integration of Mercantile is working 100% according to plan. We're still acquiring 1,300 new clients per month. We're now close to just over 100,000 clients. We have a very strong transactional recovery, very strong performance out of the ForEx division and then there's higher OpEx due to the building of the new bank. Loan growth has been very stable. But lately, we're starting to see appetite and opening up on the credit side and then you can see the ECL coverage ratio, we've actually increased it from 5.5% to 6.1%, and that's just being conservative, given what's happening in the economy. And the question I will always get is, are we on track? Yes, we're on track. I said quarter 3 next year to rebrand. So we're positive. We actually had a discussion with the Board yesterday, and we're optimistic that we're on track, and we're bringing something unique to the market. Client strategy. Now talking about the value that we're adding to clients. And I think this is a big shift that is taking place in the last couple of months, adding more value to the client. I think if we look at this, we normally open up everything in a branch. So the branch was everything. Now suddenly, we've moved that -- on the digital side, on the app, you can do everything. So I'm showing you, yes, if you want to join Capitec, you could open up your account in 5 minutes. We take official biometric of yourself. We go to the Department of Home Affairs, [FICO] you, identify yourself and open account in 5 minutes. Then you can get a free virtual card, so you can start transacting, because you've got a virtual card, you can do online shopping. And then you can -- your physical card then gets delivered to you 3 days later. You activate a lot better, and it will unpack a lot better now, you active a lot better immediately. Then you can start to do digital payments, scan to payers on the app, so you can pay where you see Masterpass, Snapscan and Zapper, by just taking your phone and show it to that QR code and you can pay. Interesting, if you look at our head office here, you can do no payments with cash or card, you must use Snapscan. You must use our scan to pay. Shop online, you do it with card or QR payment, and then the remaining IPC is also available on the card. And one that excites me and I'll share it with you is November, we're giving all 16 million or at that time, we will be at 17 million clients. We'll give each person a QR code. So you'll have your own personal code and if I then have to pay a [indiscernible], and your bank is with Capitec Bank, I will snap this QR code and you will be paid, because I feel sorry for them, because nobody of us is actually carrying cash anymore. Then if I look at credit, you can do the credit estimate on your app. If you're happy with the estimate, you kind of go straight through to our Capitec direct system. On WhatsApp, you load your pay slip and your documentation, that is necessary. And any one of the products gets given to you. And even if you want credit, that credit card gets delivered to you within 3 days. So a very slick process from that side, and then home loan application, is the home loans where you can register for a bond and you can get your home loan. And the last save and insure, our partnership with Easyequities. That's going extremely well. You can open up a flexi and term -- fixed-term and a flexi term savings account, and you can set up your funeral plan. So you can basically do anything that you can do in a branch, you can now do on our digital app, and then you'll have the support of the branches and client care. And then a strong focus is on the client engagement on the side. We're communicating on plus/minus 50 million interactions per month with clients, to say to them, how can you bank better, how can you Live Better to optimize the client experience. Then the one on partnerships. I think that's the one strong message that's come out in this sense, it's partnerships and how important partnerships is for us. Capitec Home Loans with SA Home Loans has done extremely well. With over 1 million clients that has already got bonds or are in the process. We've paid out ZAR 1.6 billion already. So that has been accepted very well in the market. And what is interesting is, if the person takes a Capitec Home Loan from our staff, he's taking a credit card or access facility as well. And normally, if you add a bond with another bank, you would have taken a credit card at that particular bank. So we're getting that business as well. And then on Purpose, I've spoken a couple of times of Purpose. We've launched actually Purpose in May and so you can see what has happened. We've got WeBuyCars. CTM, we've launched in May. The STADIO Group on education. University of Stellenbosch, also education, we're launching in October and then with Mediclinic, on the medical side. So we see this as a big growth opportunity to start working on the Purpose side, and provide value. We see that on Purpose, we will be about 2% to 3% lower than a term loan or access facility, really giving that benefit to the client. And maybe just the importance is, if you do a Purpose, the only difference is, it doesn't get paid out to yourself or to the individual, but it gets paid out to the third party, and that gives us better scoring capabilities. And there's quite a lot of new partners that's coming on board in the next couple of months. Then Live Better. That is -- maybe just to explain that. If you look at Global One, we've got 5 accounts. We've created a sixth account, and that's your Live Better account. So whenever you get a benefit, that benefit gets paid into your Live Better account and you get a higher interest rate of 3.5% on it. What is also quite interesting, the benefits gets paid to you on the 10th of each month. So we're creating a Live Better day, creating excitement of the client. What we're doing now is, you've got 2 options on your app, where you can actually move all your savings, your interest and all that interest is going into your Live Better account, or you can do a round up. So every time you swipe, you can choose ZAR 2, ZAR 5, ZAR 10, and all of those roundups are actually going into it. So as in the old days, you add coins, you put it in a jar and you save for something. It's basically the same concept. But it's quite interesting. We've acquired 2.2 million clients that has already joined. We're joining about 100,000 clients per week, and we -- the savings that's accumulated is ZAR 55 million. And then Shell, if you fill up, you get ZAR 0.20 per liter, and that currently is still going into the V-card. But from January onwards, it will also be paid in the Live Better account and then Dis-Chem is 2% on cash back. And you can see some of the other partners that we also have partner with -- so I see there's a big opportunity, because you've got the power of 17 million clients, that you can give value to. So I think there's a nice opportunity for partnerships with retailers, etcetera, etcetera. Then lastly, the future. I think if you look at -- for us, it's about scale and personal service. If I look at the people side, we still believe a branch is very important for ourselves. For me, it's quite simple. A human being can strategize and can connect with somebody else. A computer can compute and work out algorithms, as how do you actually put that together. to get to the right answer. Cross skill and remote service model is for us important. So I don't see in the next year or 2, that Capitec people will be appointed in this particular position and they will be appointed in a cross skill position, so that you work, let's say, this month in this department and next month in another department, because I think it creates excitement, it creates a better skill component, and I think that will give us that flexibility and agility to be much stronger in the market. Then you've seen, we're still looking for people. We still -- it's quite scary. The current vacancies that we are looking for is 500 people. Of that ZAR 200 million, ZAR 200,000 is for the branches and then another ZAR 300 million is on the tech side, data side, etcetera, it links on to digital and data. We should be by the end of next year, we should be about 90% fully on cloud, and that gives us that ability to do machine learning and AI much quicker and faster and then a very big focus on payments and e-commerce. I've spoken about the QR code. We've got a separate division that's just focusing on payments and e-commerce. Then on partnerships, I think I've explained that we started off with products. You had [indiscernible], you have Easyequities. Now it's about partnerships on the Live Better side, on the Purpose side, the technology side, and products. So what we're working on, is to create that unique client experience, is to be able to say, what are we good at and what is our partners good at, and make certain that we deliver to our client, what is best for their clients. And then business bank, we're building a digital business bank, and that focus will be on the SME market. So we're quite excited in that particular space. So yes, I think overall, thanks a lot. I think we, from our side, are fairly happy with the results. I think it's a good set of results, especially how we recovered from COVID and the unrest. Thank you very much. We will handle questions now.

Good morning. There's only one question so far from Mark, and he wanted to know whether the dividend of 50% is permanent, or whether it's just for this period? The intention is definitely to change it going forward. We just have to look at the regulatory potential changes that are being discussed at this point in time. So I think one can work on 50% going forward.

No more questions.

We've got no more questions. Any other comments?

No. Thanks a lot.

Thank you very much.