While two-thirds of Sub-Saharan African countries have returned to pre-crisis growth levels in 2011, South Africa has been stuck at 3% GDP growth. Politically the country has been directionless; the economy has underperformed and unemployment has risen further. In this context, while spectacular banking results have been few and far between, the financial services sector has once again performed above par. In a very mixed picture, some have done better than others. We have picked some winners, and some losers.

The winners:

-         South Africa’s banking sector

The country was rated second for soundness of banks by the World Economic Forum. In a year in which rating agencies fell over themselves to downgrade European and US banks, the contrast with South Africa’s relatively unscathed financial institutions could not have been starker. Moody’s celebrated their resilience at the end of the year by keeping the outlook for South Africa’s banking system stable, praising improved operating conditions, improved results, solid balance sheets and strong capital buffers.

-         Standard Bank

Africa’s largest bank by assets set out to focus on the continent, disposing of assets abroad, from Russia to Argentina, that had been acquired in a more ambitious phase of global expansion.

This turned out to be a wise decision, praised by analysts and one which is already delivering results. Standard Bank was named bank of the year in Africa by The Banker, as well as Best Bank in Botswana, Lesotho, Malawi and Zimbabwe.

“This is a prestigious award which recognises excellence in banking,” says Tine Erasmus, general manager of Network Finance, a specialist recruitment agency in Pretoria. “It has made sense for Standard Bank to put all their focus into Africa.”

-         Nigeria

Every bank with a presence in Africa wants to invest in Nigeria, which has been identified as a bright long-term prospect for financial services. It is Africa’s most populous country and its banking sector is immature with the potential for high growth.

“Nigeria is seen as a place of massive opportunity to bank the unbanked,” says Anton Apps, director of Anton Apps, a private recruitment firm in Johannesburg. “The combination of population, resource wealth and a favourable regime is attracting many banks.” Standard Bank, parent of local bank Stanbic and Absa, controlled by Barclays, are planning to expand further.

FirstRand, despite a setback in failing to acquire Sterling Bank in 2011, has said it wants to make another acquisition in Nigeria in 2012. Goodluck Jonathan’s new government, sworn in last May, has the weight of great expectations on its shoulders. The future is bright, provided the economic reform programme maintains its momentum.

The Losers:

2011 was a challenging year and some inevitably failed to rise to the challenge. The following are hoping for an easier ride in 2012:

-         The securities brokerage industry

Competition has been intense in 2011, from local players and foreign banks strengthening their presence, like Credit Suisse, or making acquisitions to enter the field, like BNP Paribas or India’s Religare Capital Markets. The result is that margins and commissions have been squeezed by the increased competition. “The margins for both local and international companies have been under extreme pressure,” says Phryne Williams, managing director of Capital Assignments, a specialist financial services recruitment firm. “People who resigned have not been replaced and there have been some retrenchments, a strong indicator of severe pressure in terms of both volumes and profits. It will probably get worse before it gets better.”

-         Investec.

South Africa’s fifth bank, with a dual listing in Johannesburg and London, has impressed the markets over the years with its consistent performance, strong management and relentless ambition. This year though Investec has posted disappointing results, with lower profits, a drop in deal flow and a loss in the private banking division. “Investec’s overall performance has not been great but their asset management division has done very well,” says Erasmus. On the bright side, while there may be lay-offs in the UK following the acquisition of Evolution, no redundancies are expected in South Africa.

-         Zambia.

Newly elected president Michael Sata has rattled investors by abruptly scrapping the $5.4m sale of Finance Bank, the country’s third-largest retail bank, to South Africa’s First Rand and sacking the entire board of the central bank as well as the governor, who had a reputation for competency but was seen as too close to the previous government. On the positive side, Sata has taken a tough line on corruption and strengthened corporate governance. In recognition of this, the European Investment Bank this month announced it would end a two-year lending freeze to Zambia.