S.Africa's unsecured credit boom no bubble: c.bank

PRETORIA – Rapid growth in South Africa’s unsecured lending has not sparked a bubble and banks are managing exposure to the business prudently, the central bank said in its regular review of the financial system on Wednesday.

Growth of unsecured loans – which don’t require collateral and are riskier and more lucrative for banks – has surged over the last year in Africa’s top economy, as lenders push to offset weak corporate demand for credit.

The trend has caused some policy makers and analysts to caution that banks are too eager to extend more credit to debt-laden households.

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