Nedbank Group delivered a strong financial performance for the six months to 30 June 2022 after headline earnings increased by 27 per cent to R6,7 billion, driven by strong revenue growth, a slightly higher impairment charge and a well-managed expense base.
According to the Group executive officer, Mike Brown Group’s financial performance in the first half of 2022 reflects an excellent performance across all key metrics in a complex and difficult external environment.
“We delivered strong revenue growth of 11 per cent, a credit loss ratio (CLR) that was flat year on year (YoY) at 85 bps and good cost management. As a result, headline earnings (HE) increased by 27 per cent to R6,7 billion. The Group’s return on equity (ROE) increased to 13,6 per cent (June 2021: 11,7 per cent), and all our business clusters generated ROEs above the Group’s cost of equity (COE). The Group ROE was diluted by an average of R11bn of surplus tier 1 capital held at the centre as we remain appropriately conservative in an uncertain external environment. We retain surplus capital primarily for higher levels of future growth and dividend payments,” said Brown.
The Group’s balance sheet remained very strong, and capital and liquidity positions improved further. CET1 and tier 1 capital ratios of 13,5 per cent and 15,1 per cent, respectively, increased from the 31 December 2021 levels and are well above SARB minimum requirements.
On 1 April 2022, Nedbank Group ordinary shares started trading
on A2X Markets (A2X) via a secondary listing. The secondary
listing on A2X complements our existing listings on the
Johannesburg Stock Exchange (JSE) and the Namibian Stock
Exchange (NSX) by giving our investors the opportunity
to source additional liquidity and save money when they
transact, thereby benefiting Nedbank shareholders. Since
listing, the Nedbank share has been a top 10 traded equity on
“Our Managed Evolution (ME) technology strategy has reached 89% completion of the IT build, enabling continued double-digit
growth in digital metrics. Client satisfaction scores are around the top end of the SA banking peer group, levels of cross-selling are increasing, and cumulative TOM 2.0 cost savings of R1,2bn are ahead of target.”
“Lastly, as we continue to create positive impacts, we remain committed to our market-leading Energy Policy as evidenced
in renewable-energy lending exposures of R28 billion, strong lending pipelines related to the Sustainable Development Goals (SDGs) and retaining our top-tier environmental, social and governance (ESG) ratings,” said Brown.