Johannesburg – Nedbank, majority owned by Old Mutual, says
headline earnings grew 16.2 percent in the year to December when its
loss-making associate ETI is stripped out.
Adding ETI back in, headline earnings gained 5.9 percent
to R11.5 billion, it said in a statement on Tuesday.
The listed bank ads its full-year dividend was up 8.4 percent
to 1 200 c a share.
CEO Mike Brown says “Nedbank delivered a solid
performance in 2016, with excellent growth from our managed operations
offsetting an attributable loss from our associate ETI.”
Brown adds CIB's earnings growth of 15.5 percent reflects
the benefits to revenue generation from deeper client penetration as a result of
the integrated business model.
Net interest income grew 10.6 percent to R26.4 billion.
This was underpinned by growth in average interest-earning banking assets of 7
percent and net interest margin (NIM) expansion to 3.41 percent from 3.3
percent.
Brown adds the performance of its about 20 percent
investment in ETI was below expectations, as it was impacted by weaker economic
conditions in West Africa and currency volatilities, particularly in Nigeria.
“This led to the carrying value of our investment in ETI
decreasing to R4 billion at year-end, including an impairment provision of R1
billion based on the value-in-use calculation performed in terms of
International Financial Reporting Standards.”
Read also: Old Mutual to cut share in Nedbank to minority
Brown notes conditions in the key markets in which ETI
operates are currently expected to remain difficult in 2017, before improving
in 2018 and beyond.
“Our performance guidance for the full year in 2017 is
currently for growth in diluted headline earnings per share to be greater than
the consumer price index plus gross domestic product growth.”
Nedbank adds it created 1 089 new permanent-employment
opportunities and invested R413 million in staff training, with more than 19
600 staff members participating in learning interventions and 1 140 staff members
being supported through bursaries for further development.
The bank also rolled out an additional 219 Intelligent
Depositors, including 170 self-service devices, 6 025 new point-of-sale
devices, and converting a further 45 branches to smaller and more digitally
focused branches of the future since December 2015.
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