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JSE NBKP
NBKP
NBKP - Nedbank Limited - Reviewed Interim Financial Results For The Six Months
Ended 30 June 2008
Nedbank Limited
Reg No 1951/000009/06
Incorporated in the Republic of South Africa
JSE share code: NBKP
ISIN: ZAE000043667
Reviewed interim financial results
For the six months ended 30 June 2008
A member of the Old Mutual Group
Overview
Nedbank Limited (`Nedbank`) is a wholly owned subsidiary of Nedbank Group
Limited, which is listed on JSE Limited. These consolidated interim financial
results are published to provide information to holders of Nedbank`s listed
non-redeemable non-cumulative preference shares.
Commentary relating to the Nedbank consolidated interim financial results is
included in the Nedbank Group Limited group results, as presented to
shareholders on 6 August 2008. Further information is provided on the website
www.nedbankgroup.co.za.
Board changes during the year
Cedric Savage retired as an independent non-executive director (14 May 2008)
and Barry Davison resigned as an independent non-executive director (2 August
2008).
Accounting policies
Nedbank is a company domiciled in South Africa. The consolidated interim
financial results of the company at and for the half year ended 30 June 2008
comprised those of the company and its subsidiaries (together referred to as
the `group`) and the group`s interests in associates and jointly controlled
entities.
Nedbank`s principal accounting policies have been applied consistently over the
current and prior financial years, except for the adoption of IFRIC 11:
IFRS 2 - Group and Treasury Share Transactions in the current year. The prior
years` comparative figures have been restated.
Nedbank`s consolidated interim financial results have been prepared in
accordance with the recognition and measurement criteria of International
Financial Reporting Standards (IFRS), interpretations issued by the
International Financial Reporting Interpretations Committee (IFRIC), and the
presentation and disclosure requirements of International Accounting Standard
34: Interim Financial Reporting.
In the preparation of these consolidated interim financial results the group
has applied key assumptions concerning the future and other indeterminate
sources in recording various assets and liabilities. These assumptions were
applied consistently to the group consolidated interim financial results for
the six months ended 30 June 2008. These assumptions are subject to ongoing
review and possible amendments.
Reviewed results - auditors` opinion
KPMG Inc and Deloitte & Touche, Nedbank`s independent auditors, have reviewed
the consolidated interim financial results contained in this interim report
and have expressed an unmodified conclusion on the consolidated interim
financial results. The review report is available for inspection at Nedbank`s
registered office.
Nedbank non-redeemable non-cumulative preference shares
- declaration of dividend no 11
Notice is hereby given that preference dividend no 11 of 55,02048 cents per
share has been declared for the period from 1 January 2008 to 30 June 2008,
payable on Monday, 1 September 2008, to shareholders of the non-redeemable
non-cumulative preference shares recorded in the books of the company at the
close of business on Friday, 29 August 2008.
In accordance with the provisions of Strate, the electronic settlement and
custody system used by JSE Limited, the relevant dates for the payment of the
dividend are as follows:
Last day to trade cum dividend Friday, 22 August 2008
Shares trade ex dividend Monday, 25 August 2008
Record date Friday, 29 August 2008
Payment date Monday, 1 September 2008
Share certificates may not be dematerialised or rematerialised between Monday,
25 August 2008, and Friday, 29 August 2008, both days inclusive.
Where applicable, dividends in respect of certificated shares will be
transferred electronically to shareholders` bank accounts on payment date. In
the absence of specific mandates, dividend cheques will be posted to
shareholders. Shareholders who have dematerialised their share certificates
will have their accounts, at their participant or broker, credited on Monday,
1 September 2008.
For and on behalf of the board
RJ Khoza TA Boardman
Chairman Chief Executive
6 August 2008
Registered office:
Nedbank Sandton, 135 Rivonia Road, Sandown, 2196
PO Box 1144, Johannesburg, 2000
Transfer secretaries:
Computershare Investor Services (Pty) Limited, 70 Marshall Street,
Johannesburg, 2001
PO Box 61051, Marshalltown, 2107
Directors: Dr RJ Khoza (Chairman), Prof MM Katz (Vice-chairman),
ML Ndlovu (Vice-chairman), TA Boardman* (Chief Executive), CJW Ball**,
MWT Brown* (Chief Financial Officer), TCP Chikane, MA Enus-Brey,
Prof B de L Figaji, R Harris (British), RM Head (British), JB Magwaza,
ME Mkwanazi, GT Serobe, JH Sutcliffe (British)
* Executive **Senior independent non-executive director
Company Secretary: GS Nienaber
Sponsors: Investec Bank Limited, Nedbank Capital
Nedbank Limited Reg No 1951/000009/06
Incorporated in the Republic of South Africa
JSE share code: NBKP
ISIN: ZAE000043667
Consolidated income statement
for the period ended Reviewed Reviewed Audited
June June December
Rm 2008 2007 2007
Interest and similar income 25 477 18 319 40 185
Interest expense and similar charges 17 942 11 961 26 631
Net interest income 7 535 6 358 13 554
Impairment charge on loans and advances 1 865 1 009 2 115
Income from lending activities 5 670 5 349 11 439
Non-interest revenue 4 541 4 679 9 725
Operating income 10 211 10 028 21 164
Total expenses 6 191 5 943 12 768
Operating expenses* 6 087 5 873 12 633
BEE transaction expenses 104 70 135
Indirect taxation 182 129 298
Profit from operations before non-
trading and capital items 3 838 3 956 8 098
Non-trading and capital items 766 19 25
Profit on sale of subsidiaries,
investments and property
and equipment 766 21 27
Net impairment of investments, property
and equipment, and
capitalised development costs (2) (2)
Profit from operations 4 604 3 975 8 123
Share of profits of associates and
joint ventures 7 55 54
Profit before direct taxation 4 611 4 030 8 177
Total direct taxation 1 068 1 054 2 185
Direct taxation* 958 1 056 2 185
Taxation on non-trading and capital items 110 (2)
Profit for the period 3 543 2 976 5 992
Attributable to:
Profit attributable to equity holders
of the parent 3 434 2 830 5 681
Profit attributable to minority
interest - ordinary shareholders 102 139 298
Profit attributable to minority
interest - preference shareholders 7 7 13
Profit for the period 3 543 2 976 5 992
* June and December 2007 restated.
Earnings reconciliation
for the period ended Reviewed Reviewed Audited
June 2008 June 2007 December 2007
Rm Gross Net Gross Net Gross Net
Profit attributable
to equity holders
of the parent 3 434 2 830 5 681
Less: non-trading
and capital items 766 656 19 21 25 25
Net profit on sale
of subsidiaries,
investments and
property and
equipment 766 656 21 23 27 27
Net impairment of
investments,
property and
equipment, and
capitalised
development costs (2) (2) (2) (2)
Headline earnings 2 778 2 809 5 656
Condensed consolidated cashflow statement
for the period ended Reviewed Reviewed Audited
June June December
Rm 2008 2007 2007
Cash generated by operations* 6 219 5 649 11 882
Change in funds for operating activities* (2 675) (1 670) (10 560)
Net cash generated from operating
activities before taxation 3 544 3 979 1 322
Taxation paid (1 127) (1 245) (2 126)
Cashflows from/(utilised in) operating
activities 2 417 2 734 (804)
Cashflows utilised in investing
activities (236) (930) (1 418)
Cashflows (utilised in)/from financing
activities (478) 1 780 1 927
Net increase/(decrease) in cash and cash
equivalents 1 703 3 584 (295)
Cash and cash equivalents at the
beginning of the period** 17 896 18 191 18 191
Cash and cash equivalents at the end of
the period** 19 599 21 775 17 896
* June and December 2007 restated.
** Including mandatory reserve deposits with central bank.
Adoption of IFRIC 11: IFRS 2 - Group and Treasury Share Transactions IFRIC 11
is an interpretation of IFRS 2 - Share-based Payment and requires that, where
the parent grants rights to its equity instruments to employees of its
subsidiary and the share-based payment arrangement is accounted for as equity
settled in the consolidated financial statements of the parent, it should be
treated as equity settled at the subsidiary level. Rights to Nedbank Group
Limited shares under three share-based payment arrangements were historically
treated as cash-settled in the Nedbank Limited financial statements and as
equity-settled in the Nedbank Group Limited consolidated financial statements.
The adoption of IFRIC 11 has required that the Nedbank Limited financial
statements for prior years be restated. The resultant effects can be summarised
as follows:
for the period ended Audited Reviewed Audited
December June December
Rm 2006 2007 2007
Balance sheet
Increase in share-based payment reserve (259) (294) (352)
Increase in retained income (278) (252) (262)
Decrease in share-based payment
liability 537 546 614
Income statement
Decrease in share-based payment expense (75) (159)
Increase in direct taxation 22 46
Effect after taxation - (53) (113)
Consolidated balance sheet
at Reviewed Reviewed Audited
June June December
Rm 2008 2007 2007
Assets
Cash and cash equivalents 10 122 14 046 9 545
Other short-term securities 16 517 14 175 11 775
Derivative financial instruments 18 082 9 189 9 924
Government and other securities 36 188 25 107 29 271
Loans and advances 408 325 346 299 373 185
Other assets 6 547 5 021 4 920
Clients` indebtedness for acceptances 3 121 2 651 2 236
Current taxation receivable 2 832 29
Investment securities 2 667 2 850 2 739
Non-current assets held for sale 25
Investments in associate companies and
joint ventures 788 839 735
Deferred taxation asset 78 85 65
Investment property 75 66 75
Property and equipment 3 757 3 411 3 757
Long-term employee benefit assets 1 528 1 409 1 305
Computer software and capitalised
development costs 1 473 1 235 1 323
Mandatory reserve deposits with central
bank 9 477 7 729 8 351
Goodwill 1 390 1 369 1 392
Total assets 520 137 436 338 460 627
Equity and liabilities
Ordinary share capital 27 27 27
Ordinary share premium 14 422 14 422 14 422
Reserves* 15 691 12 232 13 954
Total equity attributable to equity
holders of the parent 30 140 26 681 28 403
Preference share capital and premium 3 122 3 131 3 122
Minority shareholders` equity
attributable to
- ordinary shareholders 1 307 1 230 1 307
- preference shareholders 300 300 300
Total equity 34 869 31 342 33 132
Derivative financial instruments 16 952 10 089 10 336
Amounts owed to depositors 438 728 368 233 389 290
Other liabilities* 10 388 9 588 10 419
Liabilities under acceptances 3 121 2 651 2 236
Current taxation liabilities 210 249 275
Deferred taxation liabilities 1 670 1 933 1 470
Long-term employee benefit liabilities 1 251 1 225 1 145
Long-term debt instruments 12 948 11 028 12 324
Total liabilities 485 268 404 996 427 495
Total equity and liabilities 520 137 436 338 460 627
Guarantees on behalf of clients 20 287 18 524 20 564
* June and December 2007 restated.
Condensed consolidated statement of changes in equity
Minority
Total equity shareholders`
attributable equity
to equity Preference attributable
holders of share capital to preference
Rm the parent and premium shareholders
Balance at 31 December 2006 24 032 2 770 300
Net effect of adopting
IFRIC 11* 537
Restated balance at 31
December 2006 24 569 2 770 300
Ordinary minority
shareholders` share of
preference dividends paid 6
Dividends to ordinary
shareholders (623)
Dividends to preference
shareholders (122) (13)
Issues of shares net of
expenses 361
Shares issued by subsidiary
Total income and expense
for the period 2 857 - 7
Profit for the period* 2 830 7
Net income recognised
directly in equity 27 - -
Foreign currency
translation reserve
movement 6
Available-for-sale
reserve movement 3
Property revaluation
reserve movement 1
Share-based payment
reserve movement* 14
Other movements* 3
Restated balance at 30
June 2007 26 681 3 131 300
Ordinary minority
shareholders` share of
preference dividends paid 7
Dividends to ordinary
shareholders (1 325)
Dividends to preference
shareholders (137) (9) (13)
Issues of shares net of
expenses 1
Total income and expense
for the period 3 183 - 6
Profit for the period* 2 851 6
Net income recognised
directly in equity 332 - -
Foreign currency
translation reserve
movement (2)
Available-for-sale
reserve movement (77)
Property revaluation
reserve movement 353
Share-based payment
reserve movement* 64
Disposal of subsidiaries
Buyout of minorities
Other movements* (6)
Restated balance at 31
December 2007 28 403 3 122 300
Ordinary minority
shareholders` share of
preference dividends paid 7
Dividends to ordinary
shareholders (934)
Dividends to preference
shareholders (161) (14)
Total income and expense
for the period 2 832 - 7
Profit for the period 3 434 7
Net income recognised
directly in equity (602) - -
Foreign currency
translation reserve
movement 17
Available-for-sale
reserve movement (298)
Property revaluation
reserve movement 8
Share-based payment
reserve movement (328)
Disposal of subsidiaries
Other movements (1)
Balance at 30 June 2008 30 140 3 122 300
Minority
shareholders`
equity
attributable
to ordinary Total
Rm shareholders equity
Balance at 31 December 2006 955 28 057
Net effect of adopting IFRIC 11* 537
Restated balance at 31 December 2006 955 28 594
Ordinary minority shareholders` share of
preference dividends paid (6) -
Dividends to ordinary shareholders (11) (634)
Dividends to preference shareholders (135)
Issues of shares net of expenses 361
Shares issued by subsidiary 150 150
Total income and expense for the period 142 3 006
Profit for the period* 139 2 976
Net income recognised directly in equity 3 30
Foreign currency translation reserve movement 6
Available-for-sale reserve movement 3
Property revaluation reserve movement 1
Share-based payment reserve movement* 14
Other movements* 3 6
Restated balance at 30 June 2007 1 230 31 342
Ordinary minority shareholders` share of
preference dividends paid (7) -
Dividends to ordinary shareholders (10) (1 335)
Dividends to preference shareholders (159)
Issues of shares net of expenses 1
Total income and expense for the period 94 3 283
Profit for the period* 159 3 016
Net income recognised directly in equity (65) 267
Foreign currency translation reserve movement (2)
Available-for-sale reserve movement (77)
Property revaluation reserve movement 353
Share-based payment reserve movement* 64
Disposal of subsidiaries (54) (54)
Buyout of minorities (23) (23)
Other movements* 12 6
Restated balance at 31 December 2007 1 307 33 132
Ordinary minority shareholders` share of
preference dividends paid (7) -
Dividends to ordinary shareholders (67) (1 001)
Dividends to preference shareholders (175)
Total income and expense for the period 74 2 913
Profit for the period 102 3 543
Net income recognised directly in equity (28) (630)
Foreign currency translation reserve movement 17
Available-for-sale reserve movement (298)
Property revaluation reserve movement 8
Share-based payment reserve movement (328)
Disposal of subsidiaries (29) (29)
Other movements 1 -
Balance at 30 June 2008 1 307 34 869
* Restated.
Condensed operational segmental reporting
for the period ended
Reviewed Reviewed Audited
June 2008 June 2007 December 2007
Rm Rm Rm
Total Total Total
assets assets assets
Nedbank Corporate 228 331 183 220 208 387
Nedbank Capital 173 075 149 412 143 419
Nedbank Retail 166 839 142 448 154 144
Imperial Bank 43 560 34 004 38 195
Shared Services 6 217 6 452 6 683
Central Management 38 104 18 935 20 580
Eliminations (107 119) (73 639) (82 552)
Total per Nedbank Group 549 007 460 832 488 856
Fellow-subsidiary adjustments (28 870) (24 494) (28 229)
Total 520 137 436 338 460 627
Reviewed Reviewed Audited
June 2008 June 2007 December 2007
Rm Rm Rm
Operating Operating Operating
income income income
Nedbank Corporate 3 954 3 939 8 215
Nedbank Capital 1 349 1 178 2 655
Nedbank Retail 4 926 4 690 10 024
Imperial Bank 543 541 1 207
Shared Services 59 65 162
Central Management 225 11 412
Eliminations (36) (130) (247)
Total per Nedbank Group 11 020 10 294 22 428
Fellow-subsidiary adjustments (809) (266) (1 264)
Total 10 211 10 028 21 164
Reviewed Reviewed Audited
June 2008 June 2007 December 2007
Rm Rm Rm
Headline Headline Headline
earnings earnings earnings
Nedbank Corporate 1 503 1 344 2 632
Nedbank Capital 600 500 1 174
Nedbank Retail 728 894 1 876
Imperial Bank 88 107 227
Shared Services 27 41 (15)
Central Management (3) (111) 27
Eliminations
Total per Nedbank Group 2 943 2 775 5 921
Fellow-subsidiary adjustments (165) 34 (265)
Total 2 778 2 809 5 656
Segmental comparatives have been restated in line with the group`s
implementation of economic-value-based management. From 2008 economic profit
(EP) replaces ROE as the primary internal financial performance measure in the
group. EP is a best-practice measure since it incentivises an appropriate
balance between return and growth, and better aligns with shareholder value
creation.
Condensed geographical segmental reporting
for the period ended
Reviewed Reviewed Audited
June 2008 June 2007 December 2007
Operating Operating Operating
Rm income income income
South Africa 10 224 9 627 21 024
Business operations 10 224 9 627 21 024
BEE transaction expenses
Profit attributable to minority
interest - preference shareholders
Rest of Africa 379 288 669
Business operations 379 288 669
BEE transaction expenses
Rest of world - business
operations 417 379 735
Total per Nedbank Group 11 020 10 294 22 428
Fellow-subsidiary adjustments (809) (266) (1 264)
Total 10 211 10 028 21 164
Reviewed Reviewed Audited
June 2008 June 2007 December 2007
Headline Headline Headline
Rm earnings earnings earnings
South Africa 2 769 2 631 5 623
Business operations 3 042 2 839 6 039
BEE transaction expenses (105) (79) (144)
Profit attributable to minority
interest - preference shareholders (168) (129) (272)
Rest of Africa 70 50 116
Business operations 71 51 119
BEE transaction expenses (1) (1) (3)
Rest of world - business
operations 104 94 182
Total per Nedbank Group 2 943 2 775 5 921
Fellow-subsidiary adjustments (165) 34 (265)
Total 2 778 2 809 5 656
These results and additional information are available on
www.nedbankgroup.co.za.
Date: 06/08/2008 08:00:01 Produced by the JSE SENS Department.
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