Oh what a dull, decrepit time to be a banker, especially a banker in one of the big four.

Performance is a matter of the economy — banks’ businesses are so vast that they are stuck in the currents they find themselves in. About the best you can do is find ways to cut costs, with top-line revenue nigh impossible to grow in a market where no one wants to invest.

So the banks’ results for last year trickled out over the last two weeks and reflect an economy that grew just 0.8% in real terms or 4.8% nominally. Local growth for the big four banks was in the lower single digits on most metrics. For most, the top line was flat, with profits only nudged upward thanks to lower costs.

There are, however, some interesting areas of outperformance. Perhaps the clearest is FirstRand’s retail and business bank FNB. It managed to grow earnings 13% while delivering a market-thrashing return on equity of 42.2%.

FirstRand’s reporting cycle is six months out compared to the rest of the big four, so the figures are slightly flattered by a stronger second half last year. But only slightly. The return on equity figure is even more than Capitec’s, currently, the highest rated bank in the market (it earned a return on equity of 27% for the six months to August 2018).

FNB did it thanks to high efficiencies but also a big increase in personal loans which earn higher margins than other lending, growing 41% ( other banks’ personal loans also grew but not even at half that rate). FNB also grew mortgage advances faster than the market average at 6%.

Elsewhere, the stand-out feature was the contributions from rest of Africa. Standard Bank saw a lacklustre domestic growth in profits from personal banking of 3%, but rest of Africa quadrupled its personal banking profits to R817m. For the group as a whole, rest of Africa accounted for 31% of profits up from 28%.

At Nedbank, the group’s interest in Ecobank, long a governance and operational headache with a presence largely in West Africa, came to the rescue. It reversed a big loss the previous year into a contribution of R608m, helping profit growth to 14.5% rather than the 2.8% it would have been without it. At Absa, headline earnings for SA grew by 3%, but its rest of Africa business grew 10% in constant currency terms.

In a tough economy, attention quickly turns to the performance of borrowers. So far, though, the banks are not showing that customers are particularly distressed. Credit loss ratios, which show how much bad debt the banks have had to provide for, were surprisingly benign. Absa and Standard Bank managed to improve theirs, while FirstRand’s and Nedbank’s were flat to slightly negative.

There were accounting changes that muddied the waters around provisions and there were important base effects, particularly for Standard Bank which had written off amounts connected to an aluminium fraud the previous year, but partly recovered them last year. But on the whole, the performance reflects rather strong credit management by all the banks.

Credit performance remains a worry though. The financial distress that big companies such as Edcon and Group 5 are experiencing shows how difficult it has been in retail and construction, and we should see those problems filtering into bad debt figures particularly for corporate and investment banking during the current year.

In retail banking, however, despite unemployment continuing an upward creep, credit performance has been reasonable. I suspect that in part this has been helped by overzealous write-offs in the previous years that are now being written back into collection numbers. That was not deliberate smoothing, of course, but rather that debt models of two to three years ago were painting a particularly grim picture of the future. Luckily reality has been slightly better than feared.

For the year ahead it is all about costs. All of the banks have been reducing headcount and floor space. Standard Bank earned headlines last week for announcing that it would close 91 of its 629 branches in SA, losing 1,200 jobs. It had already reduced the number of branches by 11 in 2018. Absa reduced its SA outlets by 34 in 2018  and Nedbank by 82. Plus, the outlets that remain tend to be smaller format so overall floor space has been shrinking faster than the number of branches.

About the only cost line that will grow is for IT as banks invest more in digitising processes to help reduce costs. In part this reflects global banking trends — the big four are increasingly having to compete with branchless banks that can operate at a fraction of the costs.

Given the broader issues facing the SA economy, from power problems to election-driven political stagnation, the banking sector has done well overall to maintain its financial standing. But it desperately needs the economy to mount a sustainable turnaround before banking will be interesting again.