Sanlam, Africa’s largest insurer, plans to launch banking services for its South African clients next year as part of a strategy to diversify revenue and expand into the country’s competitive credit market.
The move will be driven by a joint venture with TymeBank, the digital lender backed by billionaire Patrice Motsepe. The partnership will focus on unsecured personal loans bundled with credit life insurance, giving Sanlam a new foothold in financial services beyond insurance.
“We see a huge opportunity to move our millions of clients onto a new banking platform,” Sanlam CEO Paul Hanratty said in an interview on Thursday. “We pay a lot of claims every year and collect premiums, so this is a natural next step. We hope to test internally later this year, and by mid-2026, we aim to be in the market.”
Despite the announcement, Sanlam’s shares fell 3.5% in Johannesburg on Thursday — the steepest drop in almost two months.
TymeBank deal and new operating company
Under the agreement, TymeBank will acquire half of Sanlam’s retail-credit loan book, while the two companies establish a new operating business to drive credit growth. The venture comes as competition in South African retail banking intensifies, with Old Mutual launching OM Bank earlier this year.
Hanratty said the new platform will deepen engagement with clients and serve as the hub for Sanlam’s rewards programme. “It will allow us to be closer to our clients, and it becomes the mechanism for payments and rewards,” he noted.
The expansion sets Sanlam on a collision course with established players such as Capitec, which has a dominant share of the lower-income retail market.
Strong first-half earnings
The announcement coincided with Sanlam reporting record first-half profit, boosted by strong growth in Africa and India. Net income rose 7% to R11.6 billion in the six months to June, while net revenue from financial services climbed 14% to R8.1 billion.
“We’ve had an excellent six months,” Hanratty said. “Sales have been fantastic. We are very, very happy.”
Sanlam operates in 31 countries and has been strengthening its South African business while pursuing strategic partnerships in Africa and Asia. Earnings from its Asian operations — spanning India and Malaysia — grew 13% and accounted for 22% of group equity value at the end of June, up from 20% in December.
Looking ahead, the insurer expects momentum to continue, supported by growth in its African and Asian portfolios and stabilisation in its home market, where 69% of its business is generated. Hanratty said progress on structural reforms, easing energy constraints and expectations of lower interest rates should support the economy.
“I’m optimistic that the economy will pick up a little bit as interest rates come down,” he said. “The government’s reforms are welcome, and the improved energy situation has been great.”
Analyst view
Sanlam’s recent deals are reshaping the business toward faster-growing, higher-return markets, according to Avior Capital Markets analyst Adrienne Damant. “Sanlam shares should justifiably trade at a premium to group equity value,” Damant said in a note.