JOHANNESBURG (S&P Global Ratings) June 1, 2021--S&P Global Ratings sees credit losses in the South African banking industry abating over the next 12-18 months after rising sharply in 2020 as a result of the pandemic. We expect credit losses will start decreasing, reaching about 1.7% in 2021, from 2.1% in 2020, but remain higher than their historical levels. However, we expect the nonperforming loans (NPL) ratio will increase to about 5% of systemwide loans, reflecting the gradual end of regulatory forbearance measures. Our expectations on the evolution of asset quality assume a muted economic recovery over the next three years despite a GDP rebound of 3.6% in 2021. That said, the risk of rising economic imbalances threatening the stability of
