Update on Nedbank 2009 Interi
Ref 51/09
20 July 2009
Old Mutual plc
UPDATE ON NEDBANK 2009 INTERIM RESULTS
Nedbank Group Limited, the 55%-owned South African banking subsidiary of Old Mutual plc, has today made the following announcement in compliance with a technical rule of the JSE Limited (JSE) in respect of its headline earnings per share (HEPS) for H1 2009 compared to H1 2008 (HEPS is a non-IFRS accounting convention with which companies listed on the JSE are required to comply).
'NED - Nedbank Group - Trading Statement
NEDBANK GROUP LIMITED
(Incorporated in the Republic of South Africa)
Registration number: 1966/010630/06
JSE share code: NED
NSX share code: NBK
ISIN: ZAE000004875
('Nedbank Group' or 'the group')
TRADING STATEMENT
In its 2008 results announcement and in the trading update for the first quarter of 2009, the group cautioned that the deteriorating macroeconomic environment both globally and domestically was likely to make 2009 significantly more challenging for the South African banking sector. The economic downturn in the first half of 2009 has been greater than expected with GDP in the first quarter falling by an annualised 6,4% from the fourth quarter of 2008 and as a result interest rates have been reduced by 4% since December.
While the faster than expected reduction in interest rates is positive for the South African economy and improves prospects for medium-term earnings growth, in the short term, the negative endowment impact results in margin compression. The bank has remained solidly profitable, but this reduced endowment, together with slower asset growth and increasing impairments, has resulted in reduced earnings levels compared to the comparative period to June 2008. There are early signs that declining interest rates have now started to slow the rate of increase in impairments and consequently the credit loss ratio for the six months to 30 June 2009 ('the period') is anticipated to remain at levels similar to, or slightly below the 1,67% reported for the quarter ended 31 March 2009.
In this challenging environment, the group continued to focus on the strength of its balance sheet and grew its net asset value, maintained sound liquidity and strengthened its capital adequacy during the period. Nedbank Group's capital adequacy ratios remain well above the minimum regulatory levels. The group's Tier 1 capital adequacy ratio of 10,0% and the total capital adequacy ratio of 13,2% reported for the quarter ended 31 March 2009, are at the top end of the group's upwardly revised target ranges and June capital adequacy levels are expected to be similar to March.
Shareholders are advised that diluted headline earnings per share for the period are expected to be between 32% and 37% lower than the 719 cents per share reported for the comparative period to June 2008.
After taking into account the profit on the sale of Visa shares included in the comparative period and accounting in the current period for the transaction to purchase the Old Mutual Group's interests in the Nedlife, BoE Private Clients and Fairbairn Private Bank joint ventures, diluted basic earnings per share for the period are expected to be between 29% and 34% lower than the 879 cents per share reported for the comparative period to June 2008.
Nedbank Group's results for the six months ended 30 June 2009 will be released on SENS on Wednesday, 5 August 2009, at which stage earnings guidance will be provided for the full year.
The financial information on which this trading statement is based has not been reviewed or reported on by the group's auditors.
Sandton
20 July 2009
Sponsors to Nedbank Group in South Africa:
Merrill Lynch South Africa (Pty) Limited
Nedbank Capital
Sponsor to Nedbank Group in Namibia:
Old Mutual Investment Services (Namibia) (Pty) Ltd'
For further information on Old Mutual plc, please visit the corporate website at www.oldmutual.com
Enquiries
|
Investor Relations |
|
|
|
Patrick Bowes |
UK |
+44 (0)20 7002 7440 |
|
Deward Serfontein |
SA |
+27 (0)82 810 5672 |
|
|
|
|
|
Media |
|
|
|
Matthew Gregorowski |
UK / SA |
+44 (0)20 7002 7133 |
|
|
|
+44 (0)7748 183 834 |
|
Don Hunter (Finsbury) |
UK |
+44 (0)20 7251 3801 |
|
|
|
|
Notes to Editors
Old Mutual
Old Mutual plc is a leading international long-term savings Group. Originating in South Africa in 1845, the Group provides life assurance, asset management, banking and general insurance in over 40 countries in Europe, the Americas, Africa and Asia. Old Mutual plc is listed on the London Stock Exchange and the JSE, among others.
In the year ended 31 December 2008, the Group reported adjusted operating profit of £1.0 billion (on an IFRS basis) and had £265 billion of funds under management at the year end. The Group has approximately 57,000 employees.
This information is provided by RNS
Latest directors dealings
- 56 minutes ago ASOS
- 1 hour ago MJ Gleeson
- 1 hour ago Rolls-Royce Holdings
- 1 hour ago Crest Nicholson Holdings
- 2 hours ago Naked Wines