| Wed 9 May 2007, 7:00 | | NED/NBK - Nedbank Group - Unaudited results: three |
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NED/NBK - Nedbank Group - Unaudited results: three months ended 31 March 2007
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`)
UNAUDITED RESULTS FOR THE THREE MONTHS ENDED 31 MARCH 2007
OVERVIEW
Nedbank Group remains on track to meet its 2007 performance targets with the
positive momentum of 2006 continuing into the first quarter (Q1) of 2007.
Headline earnings per share for the period increased by 26,3% to 322 cents (Q1
2006: 255 cents). Fully diluted headline earnings per share increased by 25,0%
to 310 cents (Q1 2006: 248 cents). Basic earnings per share grew by 2,5% to 324
cents (Q1 2006: 316 cents).
The group`s annualised return on average ordinary shareholders` equity (ROE)
improved to 20,4%, up from 18,6% for the year to 31 December 2006 (Q1 2006:
18,3%). ROE (excluding goodwill) improved to 23,9%, up from 22,1% for the year
to 31 December 2006 (Q1 2006: 21,8%).
The overall economic environment for banks remains positive, despite the 200
basis points rise in interest rates during 2006. While the endowment effect of
this increase has benefited the net interest margin, an increased level of
credit stress is being felt in Nedbank Retail and the motor vehicle finance
book in Imperial Bank. Advances growth remains robust, although it is
anticipated that retail advances growth will slow as a result of the
environment of higher interest rates. This slowing growth in the retail
environment is expected to be compensated for by increasing corporate advances
growth.
The industry faces continued pressure on fees, through both intensified
industry competition and increased consumerism. Banks also face increased
regulatory requirements with the associated costs of compliance, including
preparation for the June 2007 introduction of the National Credit Act (NCA),
ongoing activity relating to the Financial Intelligence Centre Act (FICA), the
ongoing responsibilities under the Financial Advisory and Intermediary Services
Act (FAIS) and finalisation of systems ahead of the implementation of Basel II
in South Africa in January 2008.
Tom Boardman, Chief Executive, said: `It is pleasing to report first-quarter
results that show an ROE of 20,4% (23,9% excluding goodwill) and an efficiency
ratio of 53,3% - both of these are ahead of our full-year 2007 targets of 20%
and 55% respectively. The 25,0% increase in fully diluted headline earnings per
share highlights a continuation of the momentum that was built during 2006 and
was underpinned by market share gains in key advances categories. This ongoing
growth, appropriate cost discipline, prudent risk management and the active
capital management programme have kept the group on track to meet its ROE
target of 20% for the 2007 financial year. Our challenge is to maintain this
momentum and further close the gap between our ROE (excluding goodwill) and the
ROE levels of our peer group.`
`While we have attained an efficiency ratio of less than 55% for the period,
the cost of additional retail outlets, ATMs, marketing and frontline staff,
combined with price reductions instituted in 2006 across a range of products to
benefit the group and its clients in the long term, still makes the short-term
efficiency ratio target of 55% in 2007 challenging.`
FINANCIAL PERFORMANCE
The group`s headline earnings increased by 24,0% to R1 272 million (Q1 2006: R1
026 million), with basic earnings increasing by 0,9% to R1 281 million (Q1
2006: R1 270 million). Basic earnings in the prior period included a
non-headline profit of R244 million relating primarily to the finalisation of
the non-core asset disposal programme.
Net interest income (NII)
NII grew by 31,2% to R3 176 million. Nedbank Group`s net interest margin
dropped slightly from 3,92% for the 2006 year to 3,89% for the quarter (Q1
2006: 3,83%). The main factors influencing the NII growth were:
- average interest earning banking assets growth of 29,1% (Q1 2007
compared to Q1 2006);
- an endowment benefit from interest rate increases in the latter half of
2006; and
- margin compression mainly from pressure on deposit pricing as the
sector sources a higher proportion of its funding from the wholesale
deposit market, together with increased competition.
Impairment charge on loans and advances
The impairment charge on loans and advances ratio at 0,59% was in line with the
experience in the first quarter of 2006. As expected this is slightly higher
than the 0,52% reported for the year to 31 December 2006. Impairments continued
to benefit from recoveries in both Nedbank Corporate and Nedbank Capital. The
Nedbank Retail impairments charge on loans and advances ratio deteriorated to
1,31% from 1,10% in December 2006, but is in line with the corresponding period
ratio in 2006 of 1,36%. Retail impairments historically follow a seasonal trend
with an increase in the first quarter. Impairments in Imperial Bank worsened to
1,19% from 0,87% in December 2006 and 0,89% in March 2006.
The group anticipates that the impairment charge will increase in the medium
term as a result of higher interest rates and increasing levels of household
debt. Nedbank Corporate and Nedbank Capital`s impairment levels are also
currently at unusually low levels and are expected to increase as the level of
recoveries decreases.
Non-interest revenue (NIR)
NIR for the period increased by 0,9% to R2 273 million (Q1 2006: R2 252
million). Commission and fee income grew by a pleasing 14,2% in spite of the
fee reductions instituted by Nedbank Retail in July 2006, the low level of
wholesale fee increases implemented last year and the continued migration from
cheque payments to electronic transfers in the Business Banking environment.
Overall NIR growth has been affected by lower trading income for the period of
R191 million, compared with the high base of R509 million in the first quarter
of 2006 (a record trading quarter for Nedbank Group). In line with expectations
communicated to the market in the 2006 annual results presentation, Nedbank
Corporate recorded lower property private equity gains of R83 million for the
period to 31 March 2007, compared with R117 million in the first quarter of
2006. Nedbank Capital had private equity gains of R99 million, compared with
R31 million for the same period last year, and good fee income. However,
Nedbank Capital`s NIR was adversely affected by the lower trading income
referred to above, mostly due to changes in the equity markets that impacted
the business alliance with Macquarie negatively during the period. All other
trading areas performed in line with expectations.
Expenses
Expenses continue to be well-managed, and increased by 9,6% to R2 903 million
(Q1 2006: R2 648 million).
Staff expenses grew by 14,5%, reflecting the investment the group continues to
make in client-facing staff and an increase in bonus provisions as a result of
improved financial performance.
Marketing costs increased as planned by 25,9% as the group continued to invest
in the Nedbank brand. A media tracking study conducted by Millward Brown
indicates that spontaneous awareness levels of the Nedbank brand have increased
from 69% (December 2005) to 82% (February 2007).
Efficiency ratio
The `jaws` ratio remained positive, with total revenue growth of 16,6% being
7,0% above expense growth of 9,6%, resulting in the efficiency ratio improving
from 56,7% for the 2006 period to 53,3%. This ratio is not forecast to be
sustained at this level for the full year as the group invests in its
distribution network, ongoing marketing, systems optimisation, staff training
and new appointments, predominantly in frontline positions.
Associate income
Associate income increased from R31 million to R98 million mainly as a result
of the profit on the sale of JSE Limited shares during the period by the BoE
Private Clients joint venture.
Non-trading and capital items
As the group has largely completed its non-core asset disposal programme,
income after taxation from non-trading and capital items only amounted to R9
million for the period, compared with R244 million in 2006. The main component
in 2006 was the profit on the sale of shares in Net 1 UEPS Technologies Inc
(NUEPS), which amounted to R221 million.
Direct taxation
The group`s taxation charge increased from 25,6% in the period last year to
30,0% in Q1 of 2007. This increase was mainly due to additional secondary
taxation on companies (STC) on the final 2006 dividend accounted for in Q1
2007. This STC increase was the result of the reduction in dividend cover in
the final 2006 dividend and a lower election of the capitalisation award
alternative. The prior-year rate also included credits arising from accounting
for past structured finance transactions that had a more marginal impact in the
current year.
Balance sheet
Capital and capital management
Nedbank Group continues to be well-capitalised with a Tier 1 capital adequacy
ratio of 8,2% (31 December 2006: 8,3%) and a total capital adequacy ratio of
12,4% (31 December 2006: 11,8%). During the quarter Nedbank Group issued R2,35
billion of NED7 and NED8 Tier 2 subordinated debt. Shortly after the quarter
end, perpetual preference shares were issued totalling R364,4 million. These
initiatives, together with the planned redemption of the NED2 R4 billion bond
on its call date in July 2007 (subject to regulatory approval), a number of
asset securitisations and further Tier 2 capital raisings, are part of the
group`s ongoing long-term capital management programme, which seeks to achieve
an optimal and prudent capital structure.
Advances
Advances grew by 22,3% (annualised), with good growth being reflected across
most categories of advances.
Details of advances growth by major categories follow:
March December Annualised
2007 2006 increase
Rm Rm (%)
Home loans 106 763 98 944 32,0
Commercial mortgages 47 785 46 213 13,8
Properties in possession 132 131 3,1
Term loans 37 566 33 948 43,2
Credit cards 5 974 5 283 53,0
Overdrafts 15 315 13 761 45,8
Leases and instalment debtors 45 120 43 358 16,5
Preference shares and debentures 7 366 6 840 31,2
Trade and other bills 1 887 1 752 31,3
Reverse repurchase agreements 8 947 6 703 135,8
Other loans to clients 54 036 56 814 (19,8)
Impairments of advances (5 362) (5 184) 13,9
Total 325 529 308 563 22,3
Deposits
The group maintained a strong liquidity position throughout the period.
Deposits increased by 14,0% (annualised) from December 2006.
Divisional performance
Nedbank Corporate increased headline earnings by 22,1% to R735 million (Q1
2006: R602 million) and maintained its ROE above 20% at 21,9%. Core banking
headline earnings, excluding the specialised Bond Choice and property
investment activities, grew by 39,0%. This result included:
- average advances growth of 29,6% (Q1 2007, compared with Q1 2006)
and a small improvement in the margin driving an NII increase of 34,7%;
- a higher impairment charge to average advances ratio of 0,20% (Q1
2006: 0,08%), in line with expectations as the 2006 charge was
abnormally low; and
- lower overall NIR mainly resulting from the anticipated lower property
private equity gains, clients switching from cheque payments to electronic
transfers and lower price increases. Core transactional banking NIR was
up 7,7% with good volume growth in electronic banking and cash
handling.
Gaining new primary banking clients continues to be a focus area. It is
pleasing to note that further gains have been made in the public sector,
including the Uthungulu and Mossel Bay Municipalities, in addition to other key
corporate client acquisitions. Both Business Banking and Corporate Banking have
continued their strong momentum in advances growth through effective marketing
and more efficient decision-making processes.
Nedbank Capital increased its ROE from 34,9% to 37,2% through more efficient
capital utilisation, but headline earnings were impacted by lower trading
revenue and decreased by 15,9% to R285 million (Q1 2006: R339 million).
With the exception of the Macquarie business alliance (referred to under NIR
above), the division`s trading businesses performed well. Nedbank Capital
benefited from the strong deal pipeline built up in 2006 and from some
impairment recoveries. A number of significant transactions were concluded
during the period. The pipeline for fees remains strong.
Nedbank Capital recently launched two new products: Contracts For Difference,
which is an over-the-counter derivative contract that allows investors exposure
to JSE-listed securities on a leveraged basis; and the Geared Investment Plan
in conjunction with Old Mutual, which offers clients the opportunity to lock in
the current value of their shares, borrow against existing shareholdings and
invest within the Fairbairn Capital range.
Nedbank Retail increased headline earnings by 88,1% to R523 million (Q1 2006:
R278 million) and ROE from 19,5% to 28,2%. This result was achieved through:
- average advances growth of 34,9% (Q1 2007, compared with Q1 2006)
and stable margins driving NII growth of 30,2%. Nedbank Retail`s margin
widened as a result of the endowment impact from higher interest rates,
but this was offset by a reduction in home loan and personal loan
margins;
- impairments charge ratios at similar levels to the first quarter of 2006;
- strong transactional volume growth, particularly from card merchant
commissions and bancassurance volumes, driving NIR growth of 21,6%;
and
- higher associate income from our share of the sale of the JSE shares
mentioned above.
Nedbank Retail has continued to gain market share for the first two months of
the year in the home loans, card receivables and personal loans categories.
The rollout of our distribution plan, including 650 new ATMs and over 400 new
staffed outlets over the next three years, is on track both in terms of
projected expenses and revenue. An initiative to achieve a step change in the
overall sales efficiency and service levels of the Nedbank branch network has
been launched. We have invested significant time and resources preparing for
the implementation of the NCA in June 2007. Clients will be provided with a
preagreement statement and quotation, as well as enhanced affordability
assessments.
The main focus in 2007 will be the continued implementation of the growth stage
of the Nedbank Retail strategy.
Imperial Bank generated an ROE of 24,5% and grew its headline earnings by 15,3%
to R109 million. Nedbank`s share of these earnings after accounting for profits
attributable to minority interests of ordinary and preference shareholders
(including payment of a R13 million preference dividend) increased by 2,1% to
R48 million (Q1 2006: R47 million). Good growth in NII was offset by a higher
impairments charge to average advances of 1,19% (Q1 2006: 0,89%) and the
first-time impact of the preference dividend.
Sustainability
Nedbank Group has been selected as a finalist in the 2007 Financial Times
Sustainable Banking Awards in the emerging markets category. Finalists were
selected from 151 entries in 51 countries. The diverse nominees reflect the
increasing importance of sustainable banking around the world, especially in
emerging markets.
Prospects
As outlined in the group`s year-end results for 2006, management believes
performance to June 2007 is likely to be influenced by:
- growth in retail advances remaining robust but slowing, and accelerating
growth in wholesale advances;
- continued increases in wholesale funding volumes as retail asset growth is
increasing at a higher rate than retail deposit growth;
- an endowment benefit in the margin from last year`s interest rate
increases, partially offset by margin compression in certain categories of
advances;
- a slight deterioration of the impairment charge following signs of
increased levels of credit stress in Nedbank Retail and Imperial Bank,
together with fewer impairment recoveries from Nedbank Capital and Nedbank
Corporate;
- the ongoing effects of the Nedbank Retail price reductions and industry fee
pressure;
- increased pressure on revenues and costs associated with the introduction
of the NCA;
- the momentum from transactional banking mandates received by Nedbank
Corporate and a strong pipeline built up by Nedbank Capital;
- lower positive property private equity revaluations;
- additional operating efficiencies;
- investment in retail distribution and continued marketing spend on the new
brand positioning;
- finalisation of Basel II on 1 January 2008; and
- asset securitisation and ongoing capital management activities.
Consequently the group is currently expecting to achieve its target ROE of
20,0% for 2007. The efficiency ratio for the six months to 30 June 2007 is
anticipated to show a slight decline from the levels reported for the first
quarter.
Earnings forecasts to June 2007
Assuming economic conditions remain constant, the directors forecast headline
earnings for the six months to 30 June 2007 to be between 23% and 33% higher
than the R2 104 million reported for the six months to 30 June 2006. Headline
earnings per share are forecast to be between 25% and 35% greater than the 522
cents per share reported for June 2006.
Based on the forecast range of headline earnings per share above and the net
capital profits from non-core asset sales in 2006/7, basic earnings per share
for the six months to June 2007 are forecast to be between 15% and 25% higher
than the 577 cents per share reported for June 2006.
Shareholders are advised that these forecasts have not been reviewed or
reported on by the group`s auditors.
Accounting policies
These results have been prepared in accordance with IAS 34: Interim Financial
Reporting. The group`s principal accounting policies, as stated in the 2006
annual financial statements, have been applied consistently in preparing these
results.
Forward-looking statements
This announcement contains certain forward-looking statements with respect to
the financial condition and results of operations of Nedbank Group and its
group companies, which by their nature involve risk and uncertainty because
they relate to events and depend on circumstances that may occur in the future.
Factors that could cause actual results to differ materially from those in the
forward-looking statements include, but are not limited to, global, national
and regional economic conditions, levels of securities markets, interest rates,
credit or other risks of lending and investment activities, and competitive and
regulatory factors.
Financial highlights
Unaudited Unaudited Audited
March March December
2007 2006 2006
Share statistics
Number of shares listed m 451,6 443,8 450,9
Number of shares in
issue excluding shares
held by group entities m 395,4 402,7 394,7
Weighted average number
of shares m 394,9 401,9 399,5
Fully diluted weighted
average number of shares m 410,0 413,2 412,3
Headline earnings per share cents 322 255 1 110
Fully diluted headline
earnings per share cents 310 248 1 076
Net asset value per share cents 6 458 5 688 6 363
Tangible net asset
value per share cents 5 206 4 457 5 106
Closing share price cents 14 100 12 845 13 350
Price-earnings ratio historical 11 12 12
Market capitalisation Rbn 63,7 57,0 60,2
Key ratios
Return on ordinary
shareholders` equity (ROE) % 20,4 18,3 18,6
Return on total assets (ROA) % 1,19 1,16 1,14
Net interest income to
average interest-earning
banking assets % 3,89 3,83 3,92
Non-interest revenue to
total income* % 41,7 48,2 46,3
Impairments charge to
average advances % 0,59 0,59 0,52
Efficiency ratio* % 53,3 56,7 58,2
Effective taxation rate % 30,0 25,6 27,8
Group capital adequacy ratios
- Tier 1 % 8,2 9,2 8,3
- Total % 12,4 12,8 11,8
Number of employees 24 999 22 226 24 034
Balance sheet
statistics (Rm)
Total equity
attributable to equity
holders of the parent 25 533 22 906 25 116
Total equity 30 001 26 774 29 388
Amounts owed to depositors 335 858 269 088 324 685
Loans and advances 325 529 260 437 308 563
Gross 330 891 265 691 313 747
Impairment of loans and advances (5 362) (5 254) (5 184)
Total assets 442 331 363 731 424 912
Earnings reconciliation (Rm)
Profit for the period 1 281 1 270 4 533
Less: Non-trading and capital items 9 244 98
Impairment of goodwill (70)
Profit on sale of subsidiaries,
investments and
property and equipment 9 273 248
Net impairment of investments,
property and equipment, and
capitalised development costs (54)
Taxation on above items (29) (26)
Headline earnings 1 272 1 026 4 435
* March 2006 restated
Consolidated income statement
for the period ended
Unaudited Unaudited Audited
March March December
Rm 2007 2006 2006
Interest and similar income 9 003 6 150 28 521
Interest expense and similar charges 5 827 3 730 17 558
Net interest income 3 176 2 420 10 963
Impairment charge on loans and advances 466 378 1 483
Income from lending activities 2 710 2 042 9 480
Non-interest revenue* 2 273 2 252 9 468
Operating income 4 983 4 294 18 948
Total expenses 2 903 2 648 11 886
Operating expenses* 2 870 2 622 11 740
BEE transaction expenses 33 26 146
Indirect taxation 69 77 345
Profit from operations before
non-trading and capital items 2 011 1 569 6 717
Non-trading and capital items 9 273 124
Impairment of goodwill (70)
Profit on sale of subsidiaries,
investments and property and equipment 9 273 248
Net impairment of investments,
property and equipment, and
capitalised development costs (54)
Profit from operations 2 020 1 842 6 841
Share of profits of associates and
joint ventures 98 31 153
Profit before direct taxation 2 118 1 873 6 994
Total direct taxation 633 439 1 933
Direct taxation 633 410 1 907
Taxation on non-trading and capital
items 29 26
Profit for the period 1 485 1 434 5 061
Attributable to:
Profit attributable to equity holders
of the parent 1 281 1 270 4 533
Profit attributable to minority
interest - ordinary shareholders 75 54 309
- preference shareholders 129 110 219
Profit for the period 1 485 1 434 5 061
Basic earnings per share 324 316 1 135
Diluted earnings per share 312 316 1 099
Dividend declared per share 493
Dividend paid per share 394
* Reclassification of transaction costs in NIR
Expenses amounting to R38 million for the period ended 31 March 2006, directly
related to NIR, have been reclassified from operating expenses, consistent with
industry practice, and have been included in NIR.
These expenses represent transaction costs directly attributable to the
acquisition of trading instruments recorded at fair values, which do not
include transaction costs. The carrying amount of trading instruments, other
than those at fair value through profit or loss, generally includes transaction
costs. Consequently, transaction costs that would be included in the
determination of the effective interest rate of the instruments and the
interest attributable to the instrument have been disclosed within NIR. March
2006 results have been restated accordingly.
Consolidated balance sheet
at
Unaudited Unaudited Audited
March March December
Rm 2007 2006 2006
Assets
Cash and cash equivalents 9 362 13 285 12 267
Other short-term securities 23 070 23 923 25 756
Derivative financial instruments 14 003 14 872 15 273
Government and other securities 24 011 16 653 22 196
Loans and advances 325 529 260 437 308 563
Other assets 17 174 10 206 12 468
Clients` indebtedness for acceptances 2 642 1 600 2 577
Current taxation receivable 150 134 161
Investment securities 7 626 6 465 7 155
Non-current assets held for sale 349 326 490
Investments in associate companies and
joint ventures 1 018 677 907
Deferred taxation asset 102 360 120
Investment property 165 146 158
Property and equipment 3 393 3 123 3 377
Long-term employee benefit assets 1 437 1 225 1 444
Computer software and capitalised
development costs 1 244 1 276 1 266
Mandatory reserve deposits with
central bank 7 351 5 340 7 039
Goodwill 3 705 3 683 3 695
Total assets 442 331 363 731 424 912
Total equity and liabilities
Ordinary share capital 395 403 395
Ordinary share premium 9 830 10 581 9 727
Reserves 15 308 11 922 14 994
Total equity attributable to equity
holders of the parent 25 533 22 906 25 116
Minority shareholders` equity
attributable to
- ordinary shareholders 1 398 1 098 1 202
- preference shareholders 3 070 2 770 3 070
Total equity 30 001 26 774 29 388
Derivative financial instruments 11 563 16 371 12 904
Amounts owed to depositors 335 858 269 088 324 685
Other liabilities 42 123 35 504 37 847
Liabilities under acceptances 2 642 1 586 2 577
Current taxation liabilities 630 693 434
Other liabilities held for sale 276 417
Deferred taxation liabilities 1 742 690 1 649
Long-term employee benefit liabilities 1 214 1 071 1 215
Investment contract liabilities 5 556 4 345 5 278
Long-term debt instruments 10 726 7 609 8 518
Total liabilities 412 330 336 957 395 524
Total equity and liabilities 442 331 363 731 424 912
Guarantees on behalf of clients 15 253 11 064 15 250
Condensed consolidated statement of changes in equity
Minority Minority
share- share-
holders` holders`
equity equity
attri- attri-
Total equity butable to butable to
attributable to preference ordinary
equity holders share- share- Total
Rm of the parent holders holders equity
Balance at 31 December 2005 22 490 2 770 1 049 26 309
Net income recognised directly in
equity (223) - (5) (228)
Foreign currency translation
reserve movement (17) (5) (22)
Available-for-sale reserve movement (202) (202)
Share-based payments reserve
movement 49 49
Other movements (53) (53)
Profit for the period 1 269 110 54 1 433
Dividends to shareholders (747) (110) (857)
Issues of shares net of expenses 117 117
Balance at 31 March 2006 22 906 2 770 1 098 26 774
Net income recognised directly in
equity 623 - 22 645
Release of reserves previously not
available (105) (105)
Foreign currency translation
reserve movement 351 26 377
Available-for-sale reserve movement 92 92
Revaluation of owner-occupied
property 77 77
Share-based payments reserve
movement 176 176
Other movements 32 (4) 28
Profit for the period 3 264 119 255 3 638
Dividends to shareholders (815) (119) (23) (957)
Issues of shares net of expenses 758 758
Shares acquired by group entities (1 620) (1 620)
Shares issued / (repurchased) by
subsidiary 300 (150) 150
Balance at 31 December 2006 25 116 3 070 1 202 29 388
Net income recognised directly in
equity 157 - (17) 140
Release of reserves previously not
available (4) (4)
Foreign currency translation
reserve movement 74 (23) 51
Available-for-sale reserve movement 6 6
Share-based payments reserve
movement 80 80
Other movements 1 6 7
Profit for the period 1 281 135 69 1 485
Dividends to shareholders (1 123) (135) (6) (1 264)
Issues of shares net of expenses 102 102
Shares issued by subsidiary 150 150
Balance at 31 March 2007 25 533 3 070 1 398 30 001
Condensed consolidated cash flow statement
for the period ended
Unaudited Unaudited Audited
March March December
Rm 2007 2006 2006
Cash generated by operations 2 802 2 302 9 297
Change in funds for operating
activities (5 635) 160 (3 739)
Net cash generated from operating
activities before taxation (2 833) 2 462 5 558
Taxation paid (141) (137) (953)
Cash flows (utilised by)/from
operating activities (2 974) 2 325 4 605
Cash flows (utilised by)/from
investing activities (671) 324 (1 057)
Cash flows from/(utilised by)
financing activities 1 052 (913) (1 131)
Net (decrease)/increase in cash and
cash equivalents (2 593) 1 736 2 417
Cash and cash equivalents at the
beginning of the period* 19 306 16 889 16 889
Cash and cash equivalents at the end
of the period* 16 713 18 625 19 306
* Including mandatory reserve deposits with central bank
Condensed operational segmental reporting
for the period ended
Unaudited Unaudited Audited
March March December
2007 2006 2006
Rbn Rbn Rbn
Total Total Total
assets assets assets
Nedbank Corporate 183 143 175
Nedbank Capital 141 124 138
Nedbank Retail 134 101 125
Imperial Bank 32 24 30
Shared Services 6 8 9
Central Management 15 12 12
Eliminations (69) (48) (64)
Total 442 364 425
Unaudited Unaudited Audited
March March December
2007 2006 2006
Rm Rm Rm
Operating Operating Operating
income income income
Nedbank Corporate 2 002 1 711 7 654
Nedbank Capital 556 745 2 605
Nedbank Retail 2 344 1 855 8 591
Imperial Bank 263 210 932
Shared Services 8 3 228
Central Management (138) (191) (859)
Eliminations (52) (39) (203)
Total 4 983 4 294 18 948
Unaudited Unaudited Audited
March March December
2007 2006 2006
Rm Rm Rm
Headline Headline Headline
earnings earnings earnings
Nedbank Corporate 735 602 2 553
Nedbank Capital 285 339 1 145
Nedbank Retail 523 278 1 463
Imperial Bank 48 47 193
Shared Services 5 50 (176)
Central Management (324) (290) (743)
Eliminations
Total 1 272 1 026 4 435
Condensed geographical segmental reporting
for the period ended
Unaudited Unaudited Audited
March March December
2007 2006 2006
Operating Operating Operating
Rm income income income
South Africa 4 660 4 054 17 616
Business operations 4 660 4 054 17 612
BEE transaction costs
Foreign currency translation gains 4
Income attributable to preference
shareholders
Rest of Africa 137 112 657
Business operations 137 112 657
BEE transaction costs
Rest of world 186 128 675
Business operations 186 128 675
4 983 4 294 18 948
Unaudited Unaudited Audited
March March December
2007 2006 2006
Headline Headline Headline
Rm earnings earnings earnings
South Africa 1 206 984 4 176
Business operations 1 368 1 120 4 512
BEE transaction costs (33) (26) (121)
Foreign currency translation gains 4
Income attributable to preference
shareholders (129) (110) (219)
Rest of Africa 20 14 76
Business operations 20 14 99
BEE transaction costs (23)
Rest of world 46 28 183
Business operations 46 28 183
1 272 1 026 4 435
Sandton
9 May 2007
Sponsors
Merrill Lynch South Africa (Pty) Limited
Nedbank Capital
Date: 09/05/2007 07:00:04 Produced by the JSE SENS Department.
