Corporate credit leapt over the past 12 months, but where did the funds flow to and what does this mean for South Africa’s economy? The June 2026 edition of the Quarterly Bulletin has the answers.

^{13 July 2026}
 

Corporate credit grew sharply from 5.1% in February 2025 to 13.2% in February 2026.

The financial sector accounted for a higher proportion of the increased corporate borrowing, growing by 23% in the 12 months while credit to non-financial corporates increased by 4.4% over the same period.

Loans to non-financial corporates are typically associated with direct investment into the productive economy. These include loans to sectors like construction, mining and agriculture, with the funds supporting working capital. Most of this type of borrowing happens during the construction and commissioning phases of projects.

Meanwhile, financial corporates borrowed largely in response to share price increases in the stock markets to support funding within holding companies of banks and their group securities and trading entities.

The growth in credit drawn by financial corporates also mirrors market trends noted in the past year where, for instance, there was higher demand for South African government bonds and mining-related stocks. Banks cited these channels as key short-term credit drivers.

Longer-term credit growth to financial corporates was driven more by anticipated changes, such as the implementation of the Basel III regulations. These require financial institutions to bolster their capital buffers during “prosperous times” to absorb losses from potential future shocks.

While corporate credit grew strongly over the past 12 months, it largely reflected regulatory requirements, financial market conditions and balance sheet restructuring by the financial sector, with less flowing to the real economy.

Read the full Quarterly Bulletin.