Banks can get a profit boost from higher interest rates. Their massive cash balances earn higher interest, and their net interest margins also improve. But higher rates curb credit demand and add pressure on clients, leading to more bad debts. Higher interest rates have brought a spike in debt counselling cases.

Titi said Investec would also expect some of its clients to "come under pressure". But because of the bank's business model in SA, which targets corporates, high-net-worth individuals, and high-income clients, he expects Investec's client base to remain resilient.

"But generally, while our clients will have some pressure, they generally do much better and are more resilient than the general market, said Titi.

1. Based on the article above, provide measures that can be implemented by lending institutions to minimise defaults on existing loans