| Mon 2 Aug 2010, 8:30 | | OML - OLD MUTUAL plc - Nedbank Group Limited interim results 2010 |
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OLOML
OML - OLD MUTUAL plc - Nedbank Group Limited interim results 2010
OLD MUTUAL plc
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NSX share code: OLM
ISIN: GB0007389926
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Old Mutual plc
Nedbank Group Limited interim results 2010
Nedbank Group Limited ("Nedbank Group"), the majority owned South African
banking subsidiary of Old Mutual plc, released its interim results for the six
months ended 30 June 2010 today, 2 August 2010. The full Nedbank Group interim
results together with detailed financial information in HTML and PDF formats,
financial results presentation to analysts and a link to a webcast of the
presentation to analysts can be found on the company`s website
www.nedbank.co.za
The following is the full text of Nedbank Group`s announcement:
"Reviewed financial results for the six months ended 30 June 2010
- Headline earnings up 8.3% to R2,153 million
- Diluted headline earnings per share increased 0.2% to 475 cents
- Net asset value per share increased 6.6% to 9,397 cents
- Strong capital adequacy maintained (core Tier 1: 9.9%)
- ROE 10.7% and ROE (excluding goodwill) 12.2%
- Interim dividend per share of 212 cents
`While we are confident that the worst of the economic downturn is behind us,
the recovery is taking longer than initially expected. The economic outlook
improved during the earlier part of the year, but has now softened somewhat.
Against this background we are pleased to have shown growth in headline
earnings and have performed in line with most of our short-term financial
objectives for the first half. However, we remain cautious on prospects for
the second half.
Nedbank Group is well placed to take advantage of the upswing when it emerges
more fully. Our vision is to build Africa`s most admired bank. Our strategy
remains unchanged, but we will manage our portfolio of businesses more
aggressively to focus on areas we believe will yield the highest growth in
economic profit over the longer term.`
Mike Brown
Chief Executive Officer
Banking environment
The economy continued to recover in the first half of 2010. However, the
upswing comes off a low base and remains fragile. Household spending has been
slow to recover, with high personal debt levels, tight credit conditions and
further employment losses hampering consumption. High wage settlements and
lower interest service costs have led to an improvement in disposable income,
but the benefits of these have been thinly spread with many households still
under credit-related pressure. Capital formation benefited from the strong
effort to complete infrastructural projects ahead of the 2010 FIFA World Cup,
but the underlying trend in the private sector demand for credit remains weak,
given low capacity utilisation levels and continuing uncertainty over future
prospects.
Review of results
Headline earnings increased by 8.3% from R1,988 million for the period to June
2009 to R2,153 million for the six months to June 2010. Diluted headline
earnings per share increased by 0.2% from 474 cents to 475 cents, which is
lower than the increase in headline earnings as a result of the added dilution
from the issue of shares for the Nedbank Wealth joint ventures acquired from
Old Mutual in June 2009 and a higher than usual acceptance level of the scrip
dividend alternative. Diluted earnings per share decreased by 22.4% from 611
cents in June 2009 to 474 cents. As previously reported, 2009 diluted earnings
per share were boosted by a once-off International Financial Reporting
Standards (IFRS) revaluation gain of R547 million (after taxation) from the
consolidation of the Nedbank Wealth joint ventures acquired.
These results reflect an improving operating environment. They also highlight
the continued endowment-related pressure on margins following an unexpected 50
basis points decrease in the prime lending rate in March 2010 and slower than
forecast wholesale credit growth. These factors were partially offset by asset
repricing over the past 18 months and continued low impairments in Nedbank
Corporate and Nedbank Business Banking.
Given the group`s strategy to grow non-interest revenue (NIR), it is pleasing
to report core commission and fee income growth on a comparable basis of
15.7%. Total comparable NIR grew by 7.8%, with NIR being negatively impacted
by a R195 million change in the credit-related fair-value adjustments of the
bank`s own subordinated debt as our credit spreads improved.
Nedbank Retail celebrated a milestone during the period with the total retail
client base exceeding five million clients.
Lower interest rates have benefited impairments and the downward trend in
early arrears remained intact. However, improvements in retail defaulted
advances have taken longer to come through, compared with past cycles, as a
result of the comparatively higher levels of debt to disposable income. This
delay has been increased by challenges experienced in the debt counselling
process. Recent discussions between the SA Reserve Bank, commercial banks and
the National Credit Regulator on improving the debt counselling process are
expected to have a positive impact with new debt counselling inflows slowing
and overall levels of advances in the debt counselling process stabilising.
The level of defaulted advances in Nedbank Retail has improved to 119% from
12.2% in December 2009.
The group achieved a return on average ordinary shareholders` equity (ROE),
excluding goodwill, of 12.2% and an ROE of 10.7% (restated), resulting in an
overall economic loss (earnings after deducting the cost of capital employed)
of R352 million for the period (June 2009: loss of R24 million).
The group`s net asset value per share continued to increase, growing by 6.6%
(annualised) from 9,100 cents in December 2009 to 9,397 cents in June 2010.
Cluster performance
Headline Return on risk-
earnings adjusted
capital
(RORAC) %
Rm - six months % change June June June20 June
ended 2010 2009* 10 2009*
Nedbank Capital (14.4) 578 675 23.7 30.2
Nedbank Corporate (14.1) 623 725 17.6 22.6
Nedbank Business (17.9) 437 532 28.9 23.7
Banking
Nedbank Retail (66.7) (115) (69) (2.2) (1.2)
Nedbank Wealth 14.8 233 203 32.9 35.7
Imperial Bank >100.0 185 46 11.9 7.1
Operating units (8.1) 1,941 2,112 12.9 14.6
Centre - 212 (124) - -
Total 8.3 2,153 1,988 10.7 11.6
* Restated
Nedbank Capital recorded a good RORAC and an economic profit of R232 million.
The cluster`s headline earnings decreased mainly as a result of higher
impairments and a drop in trading income from difficult trading conditions in
the second quarter.
Nedbank Corporate recorded a solid RORAC and an economic profit of R123
million. The cluster`s headline earnings decreased primarily due to reduced
endowment from lower interest rates and a negative swing in fair-value
adjustments of R96 million year-on-year attributed mainly to downward movement
in the short end of the yield curve in the fixed-rate advances book and
associated interest rate swaps.
Nedbank Business Banking continued to generate a high RORAC and strong
economic profit of R223 million. This was achieved despite the lower endowment
earnings both from the environment of lower interest rates and the balance
sheet efficiency exercise undertaken during 2009 and 2010 that reduced risk-
weighted assets. As a result, capital utilisation was down by R1.5 billion in
2010 and headline earnings, on an aligned capital base, reduced by 9.5%.
Nedbank Retail recorded an economic loss of R859 million and a headline loss
of R115 million. While this is marginally worse than in H1 2009, it represents
an improved performance on H2 2009. The losses were mainly driven by lower
endowment income and continued high levels of impairments. These were offset
to an extent by continued asset repricing, an ongoing drive, in line with the
group strategy to grow NIR which grew by 14.7%, and disciplined cost growth
which amounted to 9.8%.
Nedbank Retail has undertaken a strategic review of the business and is being
repositioned to be profitable on a sustainable basis through a greater
emphasis on delivering distinctive client-centred banking experiences to all
in South Africa, underpinned by worldclass risk management practices. This
will include increasing the number and depth of client banking relationships;
a distinctive low-cost offering for the unbanked and entry-level banking
market; refining the Small Business Services offering to deliver more
effectively to the distinct needs of this market; creating one private bank
and high-net-worth offering through Nedbank Wealth; leveraging the strengths
of the monolines as an enabler to generate deep banking relationships; and
setting risk appetite metrics including credit granting criteria to accord
with the desired earnings and return profile. These strategic thrusts are
aimed at improving the foundation for medium-and longer-term profitability and
growth.
Nedbank Wealth continued to show a strong RORAC and recorded economic profit
of R133 million. On a pro forma basis, adjusting for the acquisitions of the
joint ventures and additional group cost allocations, headline earnings grew
2.4%.
The joint ventures of Fairbairn Private Bank, BoE (Pty) Limited and Nedgroup
Life Assurance Company were purchased in 2009. While low United Kingdom
interest rates and difficult local economic conditions have had an impact on
the financial performance of Fairbairn Private Bank and BoE (Pty) Limited, the
overall annual return on investment at 15.4%, was higher than what was
originally envisaged.
Imperial Bank delivered improved headline earnings, reflecting its strong
position in the used-vehicle market. The low ROE of 11.9% underlines the
importance of the drive to integrate the business into the broader Nedbank
Retail and Nedbank Business Banking offerings to enhance cross sell and
improve returns.
The planning for the integration of Imperial Bank into Nedbank is going well
with clear accountability established for Motor Finance Corporation (MFC) by
Nedbank Retail, for Supplier Asset Finance and Professional by Nedbank
Business Banking and for Property by Nedbank Corporate Property Finance.
The group currently awaits approval of the section 54 application to transfer
the assets and operations of Imperial Bank to Nedbank. The application was
submitted to the Registrar of Banks and the Minister of Finance. The decision
not to retrench any affected people during 2010 has ensured business
continuity, which is beneficial for successful integration and will be
extended to June 2011.
Further segmental commentary and detail can be found on the group website at
www.nedbankgroup.co.za and in the results booklet.
Financial performance
Net interest income (NII)
NII decreased by 1.3% to R8,082 million (June 2009: R8,185 million), largely
as a result of endowment-related margin compression. The net interest margin
for the period was 3.34%, down from 3.44% for the period to June 2009 and
3.39% for the year ended December 2009. Average interest-earning banking
assets increased by 2.8% (annualised) (June 2009 growth: 17.4%).
Changes in margin were mainly caused by:
- reduced endowment income on capital and current and savings accounts from
the 294 basis point reduction in average interest rates;
- liability margin compression reflecting a higher cost of funding,
including the cost of increased duration;
- the cost of holding additional liquidity buffers;
- a relative benefit in interest-earning assets repricing more quickly than
interest-bearing liabilities as rates did not fall as aggressively nor as
quickly as last year; and
- the benefit of improved asset pricing on new business.
Impairments charge on loans and advances
Improving conditions have resulted in the credit loss ratio on the banking
book decreasing to 1.46% for the period, compared with 1.60% (restated) for
the same period in 2009. Given the uncertain global economic conditions, we
remain cautious on the wholesale sector as this sector tends to lag retail.
Wholesale credit loss ratios, with the exception of Nedbank Capital and
Commercial Property Finance within Nedbank Corporate, improved. Nedbank
Corporate`s credit loss ratios remain below expectations for this stage of the
cycle.
In the retail sector impairments for unsecured lending decreased as a result
of improving arrears, the better quality of advances and recoveries.
Stabilising defaulted advances and higher levels of restructured loans of R2.4
billion (December 2009: R1.2 billion) in secured-lending have started to
reduce impairments in these categories.
During the period the group aligned impairment methodologies for common
clients of Imperial Bank and Nedbank. The group raised an additional R42
million in impairments through this process.
Credit loss H1 H1 H2 Year
ratio (%) toJune toJune toDecember2009* toDecember
2010 2009* 2009*
Nedbank Capital 0.80 0.60 0.12 0.36
Nedbank 0.23 0.25 0.23 0.24
Corporate
Nedbank 0.32 0.79 0.25 0.52
Business
Banking
Nedbank Retail 3.00 3.29 3.51 3.40
Nedbank Wealth 0.24 0.62 0.33 0.47
Imperial Bank 2.48 2.54 1.52 2.01
1.46 1.60 1.44 1.52
* Restated
Defaulted advances increased by 9.9% (annualised) to R28,367 million, from
R27,045 million reported in December 2009-. Total impairment provisions
increased by 24.5% (annualised) to R10 989 million for the same period,
although the rate of increase has slowed dramatically compared with last year
(June 2009: R9 142 million).
NIR
NIR increased 14.5% to R6,158 million (June 2009: R5,377 million). On a
comparable basis, adjusting for the acquisition in 2009 of the Nedbank Wealth
joint ventures, NIR growth was 7.8%. The ratio of NIR to expenses was 78.2%
(June 2009: 75.5%).
Commission and fee income grew strongly by 21.9% (on a comparable basis by
15.7%) from growth in transactional volumes and annual inflation-linked fee
increases. This strong growth is pleasing in the light of the group`s strategy
to grow NIR. In Nedbank Retail the 8.2% year-on-year increase in primary
clients as well as an improved mix contributed to NIR growth. This was further
supported by strong growth in electronic banking, cash handling and cash
management volumes in Nedbank Business Banking and Nedbank Corporate.
Trading income decreased by 3.9% from R928 million in 2009 to R892 million.
The high base was due to outperformance in the Treasury and Global Markets
businesses that benefited from trading conditions in the cycle of decreasing
interest rates in the first half of 2009. Difficult conditions were
experienced in the same period this year, although this was partially offset
by equity trading that performed reasonably well.
NIR from the private equity portfolios increased by R98 million, driven
primarily by the equity portfolio in Nedbank Capital.
NIR from private equity (Rm) June 2010 June 2009
Nedbank Capital private equity 86 10
Nedbank Corporate property (15) (37)
private equity
Total NIR from private equity 71 (27)
NIR includes a loss of R110 million (June 2009: profit of R85 million)
relating to the credit-related fair-value adjustment of the bank`s own
subordinated debt as Nedbank`s credit spreads improved.
Expenses
The group maintained a strong cost discipline ensuring that increases in
expenses were below management`s expectations. Expenses grew by 10.5% to
R7,872 million (June 2009: R7,121 million), largely as a result of the
acquisition of the Nedbank Wealth joint ventures and consolidation of Merchant
Bank of Central Africa (MBCA), and on a comparable basis expenses increased by
7.5%.
- Staff expenses increased by 12.3% (9.4% on a comparable basis), resulting
from annual salary increases and an adjustment of R70 million (June 2009:
R47 million) for the growth in the Nedgroup Pension Fund surplus assets.
Staff numbers have decreased by 0.8% annualised since December 2009.
- Marketing and public relations costs increased by 23.0% largely due to
the marketing spend ahead of the Nedbank Cup and the FIFA World Cup, and
increased spend within Nedbank Wealth joint-venture businesses on new-
product marketing, cross-selling initiatives and ongoing advertising.
- The group`s black economic empowerment (BEE) transaction expenses
decreased from R66 million to R60 million mainly due to the maturing of
the Retail Scheme.
The group`s efficiency ratio deteriorated from 52.5% to 55.3% as expected and
in line with negative growth in NII from the lower endowment income and margin
on current and savings accounts.
Taxation
The taxation charge (excluding taxation on non-trading and capital items)
decreased by 10.1% from R642 million in June 2009 to R577 million with a
decrease in the effective tax rate from 22.2% to 19.9%. This was due mainly
to:
- a lower provision for secondary tax on companies (STC), owing to an
increase to 81.5% of shareholders who elected to take scrip for the 2009
final dividend distribution (2008 final dividend distribution: 32.0%),
which does not attract STC; and
- reversals of tax risk provisions.
Non-trading and capital items
Income after taxation from non-trading and capital items decreased from a R576
million profit to a R3 million loss at June 2010 following the once-off R547
million revaluation of BoE (Pty) Limited and Nedgroup Life in the first six
months of 2009 on the acquisition of the remaining shares in the joint
ventures.
Statement of financial position
Capital
Ongoing strong balance sheet management has maintained the group`s capital
ratios well above the group`s internal targets and at levels similar to those
of December 2009. As reported at the end of the first quarter, the acquisition
of the minority shareholding in Imperial Bank was settled in cash, resulting
in an approximate 0.5% decrease in the group`s capital adequacy ratios. This
was partly offset by a 0.28% increase in capital from higher levels of takeup
under the scrip dividend alternative in the second quarter.
H1 10 Q1 10 FY 09 Internal Regulato
ratio ratio ratio target range ry
minimum
Core Tier 1 9.9% 9.8% 9.9% 7.5% to 9.0% 5.25%
ratio
Tier 1 ratio 11.5% 11.4% 11.5% 8.5% to 7.00%
10.0%
Total capital 14.8% 14.7% 14.9% 11.5% to 9.75%
ratio 13.0%
(Ratios calculated including unappropriated profits.)
Capital allocation
All risk and capital methodologies and models are reviewed regularly to ensure
they remain in line with best practice and industry and regulatory
developments.
As previously advised, a number of enhancements relating to capital allocation
to business clusters would be implemented in 2010. The main effects of these
adjustments has been to allocate a large proportion of the surplus capital
held at group to the clusters as well as refining the capital allocated in
respect of credit risk to emphasise tail risk. This has been done and the
comparative results for the operational clusters have been restated.
The key enhancements implemented were:
- increase of the group`s internal target solvency standard from 99.9% (or
A-) to 99.93% (or A) (implemented in 2009);
- update of the credit portfolio modelling correlations and revision of the
credit economic capital allocation methodology, taking into account
recent global developments and experience, and current best practice;
- change in internal measurement of operational risk for economic capital
purposes using the advanced measurement approach; and
- increasing the aggregate amount allocated to business clusters using
bottom up calculated economic capital via the allocation of a capital
buffer (limited to an effective 10% core Tier 1 regulatory ratio level
for the group) and thus aligning the clusters more closely with group
regulatory capital levels.
The above had no impact on the group`s overall capital level, but
significantly increased the quantum of capital allocated to each business
cluster and impacted the RORAC recorded by the clusters on a steady-state
basis.
Funding and liquidity
Nedbank Group`s liquidity position remains sound. The group remains focused on
diversifying its funding base, lengthening its funding profile and maintaining
appropriate liquidity buffers.
Nedbank Group successfully increased its long-term funding ratio from 18.1% in
December 2009 to 23.9% in June 2010, mainly from increased capital market
issuances under the domestic medium-term note programme (R6.23 billion) and
increased duration in the money market book.
The group`s liquidity position is further supported by a strong loan-to-
deposit ratio of 96.0% and a low reliance on interbank funding and foreign
markets. Nedbank Group is able to leverage off its favourable retail,
commercial and wholesale deposit mix, which compares well with domestic
industry averages.
Basel 3 developments
We welcome the updated Basel 3 proposals as announced on 26 July 2010. Whilst
we believe that the capital proposals remain reasonably achievable, it is
pleasing that the revised liquidity proposals are more supportive of the SA
banking industry in areas such as:
- widening of liquidity assets definition to include an element of certain
assets held by banks such as; government and public sector assets which
are risk weighted 20% under Basel 2 and certain high quality non-
financial corporate bonds; and
- extension and possible refinement of the net stable funding ratios during
the observation period until 2018.
Advances
Advances grew by 4.9% (annualised) to R461 billion at June 2010 (December
2009: R450 billion). The advances by division are as follows:
Rm June 2010 December Annualised
2009 % increase/
(decrease)
Nedbank Capital 57,640 55,315 8.5
Banking activity 41,666 41,550 0.6
Trading activity 15,794 13,765 29.7
Nedbank Corporate 142,010 137,173 7.1
Nedbank Business 52,039 50,115 7.7
Banking
Nedbank Retail 139,868 138,411 2.1
Imperial Bank 52,742 50,451 9.2
Nedbank Wealth 17,378 19,089 (18.1)
Other (374) (253) (96.4)
Total 461,303 450,301 4.9
In Nedbank Capital core banking advances, excluding foreign correspondents,
overnight loans and trading advances, grew by a modest 0.6% (annualised) from
December 2009. Nedbank Corporate and Nedbank Business Banking grew by 7.1% and
7.7% respectively. In Nedbank Retail personal loans performed in line with the
group`s strategic focus on this product, increasing by 37.1% (annualised).
Cards and vehicle asset finance grew moderately by 7.6% and 6.2% (annualised)
respectively and home loans decreased by 0.8% (annualised). The decrease in
Nedbank Wealth resulted predominantly from a decision to invest an amount of
GBP125 million in United Kingdom (UK) Treasury bills rather than placements
with other banks, as well as from the strengthening of the rand.
Deposits
Deposits increased by 4.8% (annualised) from R469 billion at December 2009 to
R480 billion at June 2010, remaining in line with advances growth.
Nedbank Group continued to focus on improving its funding mix and building on
its strong retail and business banking deposit franchise. However, retail
deposit growth remains challenging given the environment of low interest rates
and a highly competitive market, while in the professional fund management
market the cost of funding has increased as a result of the increased demand
for higher-yielding negotiable certificates of deposit (NCDs).
Competition Commission
The outcome from the Competition Commission process, announced in May 2010,
has been positive with no evidence found of collusion in the setting of fees
and charges on transactional products.
Nedbank Group welcomes the pragmatic proposals emanating from the National
Treasury process and they will further benefit clients. These proposals have
resulted in Nedbank Group undertaking several strategic initiatives as part of
the bank`s commitment to continue offering value-added banking.
Ecobank alliance and Africa
The alliance with the Pan-African banking group Ecobank gained further
momentum during the period following alignment of specific operating models to
support various tailored product offerings through joint systems enablement.
Our respective multinational corporate client bases in particular are starting
to enjoy the benefits of this network, which offers the potential for revenue
uplift. For the benefit of Ecobank retail clients, Nedbank ATMs were enabled
for regional cardholders.
Africa remains a key potential growth area in the longer term. The group,
together with Ecobank, will continue to look at opportunities in Africa as
they arise.
Outlook and prospects
Conditions during the remainder of the year will be heavily influenced by
developments in the global economy. South Africa has benefited from rising
commodity prices and improved capital inflows, but international prospects
remain uncertain. Domestic spending is expected to rise, although some loss of
momentum is probable after the initial boost provided as companies restocked
in early 2010 and as the World Cup-related spend fades. Interest rates are
forecast to remain low well into 2011, given low inflation and below-trend
economic growth.
Retail banking should fare better as household credit demand improves, house
prices edge higher, and impairments moderate, although the defaulted portfolio
is taking longer to cure than in previous cycles. Wholesale banking areas are
expected to remain under pressure with slow credit growth as fixed-investment
activity remains subdued, but transactional volumes are expected to improve
gradually.
The negative endowment effect of capital and margin compression on current and
savings accounts is anticipated to reduce during the second half if rates
remain at current levels. At the same time asset quality improvement and
impairment reductions are expected to continue, albeit at a gradual pace given
the high levels of consumer indebtedness.
The group remains cautious in its outlook for the remainder of 2010 and
performance is now expected to reflect the following:
- advances growth in the mid single digits;
- margin compression, on the 2009 margin, of around 15 to 20 basis points.
- Ongoing, gradual improvement of the credit loss ratio;
- NIR growth for the year in early to mid double digits, subject to
unforeseen moves in fair-value adjustments;
- expense growth for the year in early double digits; and
- maintaining strong capital ratios and funding structure.
Given this outlook for the second half, we currently anticipate that it will
be challenging to meet the group`s medium-term target for diluted headline
earnings per share growth of the average consumer price index plus gross
domestic product (GDP) growth plus 5%. As a result improvements in ROE for the
balance of the year are expected to be muted.
Given the strength of the group`s balance sheet, the development of the
strategy to grow NIR and the benefits of the acquisitions made in 2009, the
group is well positioned to take advantage of the economic upswing when it
emerges more fully.
Shareholders are advised that these forecasts have not been reviewed or
reported on by the group`s auditors.
Board changes
Bob Head and Jabu Moleketi resigned from the board with effect from 19
February 2010 and 1 March 2010 respectively. As previously reported, Tom
Boardman was appointed a non-executive director of Nedbank Group and Nedbank
with effect from 1 March 2010 following his retirement from the group.
Accounting policies
Nedbank Group Limited is a company domiciled in South Africa. The condensed
consolidated interim financial results at and for the half-year ended 30 June
2010 comprise the company and its subsidiaries (the `group`) and the group`s
interests in associates and jointly controlled entities.
Nedbank Group`s principal accounting policies have been prepared in terms of
IFRS and have been applied consistently over the current and prior financial
years.
Nedbank Group`s condensed consolidated interim results have been prepared in
accordance with the recognition and measurement criteria of IFRS,
interpretations issued by the International Financial Reporting
Interpretations Committee (IFRIC) and the presentation and disclosure
requirements of International Accounting Standard (IAS) 34: Interim Financial
Reporting, as well as the AC500 standards as issued by the Accounting
Practices Board or its successor.
In the preparation of these condensed 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 financial results for the
six months ended 30 June 2010. These assumptions are subject to ongoing review
and possible amendments.
Restatements
The ratios for ROE and return on assets have been restated with the
denominator changing from simple average to daily average for equity and total
asset values respectively. The calculation of the credit loss ratio has been
changed from simple average advances to daily banking advances (thereby
excluding trading advances from the calculation). Comparatives for ROE and
return on assets changes do not affect the segmental ratios, but do affect the
group ratios while credit loss ratio changes affect both.
The comparative results for the operations segment reporting at 30 June 2009
and 31 December 2009 have been restated in line with the group`s
implementation of a revised economic capital allocation methodology. The
restatement has no effect on the group results and ratios, and only changes
segment cluster results and ratios.
Events after the reporting period
There are no material events after the reporting period to report on.
Reviewed results - auditors` review report
KPMG Inc and Deloitte & Touche, Nedbank Group`s independent auditors, have
reviewed the condensed consolidated interim financial results of Nedbank Group
Limited and have expressed an unmodified review opinion on the condensed
consolidated interim financial results. The auditors` review was conducted in
accordance with International Standards on Review Engagements (ISRE 2410):
Review of Interim Financial Information Performed by the Independent Auditor
of the Entity. The condensed consolidated financial results comprise the
consolidated statement of financial position at 30 June 2010, consolidated
statement of comprehensive income, condensed consolidated statement of changes
in equity, condensed consolidated cashflow statement for the six months then
ended and selected explanatory notes. The selected explanatory notes are
marked with . The review report is available for inspection at Nedbank Group`s
registered office.
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 that, by their nature, involve risk and uncertainty because
they relate to events and depend on circumstances that may or may not 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; as well as competitive and regulatory factors. By consequence, all
forward-looking statements have not been reviewed or reported on by the
group`s auditors.
Interim dividend declaration
Notice is hereby given that an interim dividend of 212 cents per ordinary
share has been declared, payable to shareholders for the six months ended 30
June 2010. In accordance with the provisions of Strate, the electronic
settlement and custody system used by JSE Limited, the relevant dates for the
dividend are as follows:
Event Date
Last day to trade (cum dividend) Friday, 3 September
2010
Shares commence trading (ex Monday, 6 September
dividend) 2010
Record date (date shareholders Friday, 10 September
recorded in books) 2010
Payment date Monday, 13 September
2010
Shares may not be dematerialised or rematerialised between Monday, 6 September
2010 and Friday, 10 September 2010, both days inclusive.
On Monday, 13 September 2010, the dividend will be electronically transferred
to the bank accounts of all certificated shareholders where this facility is
available. Where electronic funds transfer is either not available or not
elected by the shareholder, cheques dated Monday, 13 September 2010, will be
posted on that date.
Holders of dematerialised shares will have their accounts credited at their
participant or broker on Monday, 13 September 2010.
The above dates and times are subject to change. Any changes will be published
on the Securities Exchange News Service (SENS) and in the press.
For and on behalf of the board
Dr Reuel J Khoza Michael WT Brown
Chairman Chief Executive Officer
2 August 2010"
For further information on Old Mutual plc, please visit the corporate website
at www.oldmutual.com
Enquiries
External
Communications
Patrick Bowes UK +44 (0)20 7002
7440
Investor Relations
Deward Serfontein SA +27 (0)82 810 5672
Aleida White UK +44 (0)20 7002
7287
Media
Don Hunter UK +44 (0)20 7251
(Finsbury) 3801
Notes to Editors
Old Mutual
Old Mutual plc is an international long-term savings, protection and
investment Group. Originating in South Africa in 1845, the Group provides
life assurance, asset management, banking and general insurance 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 2009, the Group reported adjusted operating
profit before tax of GBP1.2 billion (on an IFRS basis) and had GBP285 billion
of funds under management at the year end. The Group has approximately 54,000
employees.
2 August 2010
Sponsor:
Merrill Lynch South Africa (Pty) Ltd
Date: 02/08/2010 08:30:03 Produced by the JSE SENS Department.
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