| Mon 28 Oct 2002, 12:46 | | Nedcor announces integration and rebranding plans |
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Nedcor announces integration and rebranding plans
Media Release
Company: Nedcor Limited
Share Code: NED
ISIN: ZAE00000487
28 October 2002
Nedcor Ltd today confirmed that the merger with BoE is on track, provided
further details on the integration and estimated that full merger benefits
should reach R905m a year.
It also announced that over the next two years it would streamline its 20
different client brands amassed through the merger.
Nedcor Chief Executive Richard Laubscher said: "We have the opportunity, with
the merger between Nedcor and BoE, to build an exceptional bank that will reward
clients, staff and shareholders alike. Through careful planning and enormous
hard work we have made an excellent start in the integration process."
Laubscher was updating investors, analysts and media in Cape Town on progress in
integrating the two organisations since the merger was announced in April.
Topics covered in the presentations included the merger process, projected
financial benefits and the revised brand portfolio.
The brand rationalisation programme follows the Group`s restructure and, subject
to regulatory approval, handing back of various banking licences.
Nedcor will continue with its multi-brand strategy but will in future focus on
three key brands
(Nedbank, Nedbank Corporate and Peoples Bank) and five major Joint Venture
brands (BoE, Imperial Bank, Old Mutual Bank, Pick `n Pay Go Banking and Gerrard
Private Bank). The new brand portfolio will allow Nedcor to target specific
markets while leveraging the scale of the enlarged Group.
The Group`s premier brand remains Nedbank, which enjoys a strong presence in the
corporate, commercial and retail markets. Nedbank will continue unchanged in the
retail market. A new brand, Nedbank Corporate, will be created to house all of
the corporate, commercial, treasury and investment banking activities of the
Nedcor Group. Nedbank Corporate will be a full spectrum operation in the
domestic corporate and investment banking arena. It will comprise the relevant
business units of the BoE Group, Nedbank, NIB, Cape of Good Hope Bank, as well
as Edward Nathan & Friedland Inc.
With the creation of Nedbank Corporate the business brands of BoE Merchant Bank,
BoE Corporate and NIB will be phased out. The BoE Bank brand, which services the
mid-size commercial market, will be phased out over time as the systems and
branches are integrated into Nedbank Corporate. The Cape of Good Hope brand will
continue to be used in the property finance business in the Western Cape
alongside Nedbank Corporate.
Peoples Bank remains as an important and growing brand in the low- to middle-
income market and SME sector. It is intended that, over the next two years, NBS
and other brands (Cashbank, PEP Bank and Consumer Credit) will gradually be
incorporated into Peoples Bank. During this two-year period, NBS and Peoples
Bank will operate alongside each other under one management team drawn from the
current NBS and Peoples Bank management structures with John Maxwell continuing
to head Retail Banking. The team will work together to ensure that clients of
both banks are given the best possible service while being offered an increasing
range of products and outlets.
BoE, which has strong market awareness in the private banking and investment
sectors, will become the Group`s flagship brand in the wealth management arena.
As announced earlier today, several of the Group`s wealth management business
units will operate within a joint venture arrangement with Old Mutual SA,
subject to regulatory approvals. The interests of Nedcor`s minority shareholders
were represented by independent non-executive directors on the Nedcor board.
Nedcor also announced that it was selling a controlling stake in BoE Asset
Management to AKA Capital, a black empowerment private equity and investment
group. In addition, Peoples Bank minorities and Peoples Bank itself will acquire
a shareholding in BoE Asset Management, further enhancing its empowerment
credentials.
The following brands remain unchanged: Old Mutual Bank brand, a joint venture
aimed at the middle-income retail market, offshore private bank Gerrard Private
Bank; Nedcor`s retail banking joint venture Pick `n Pay Go Banking, and its
vehicle and aircraft finance joint venture, Imperial Bank.
The Nedcor brand, which is also the name of the holding company, remains as the
investor brand.
Nedcor chief executive, Richard Laubscher, said: "The purpose of the
rebranding exercise is to focus our efforts behind our strongest brand in each
market segment. It will be a process, however, rather than an event, which will
be managed in a sensible fashion over the next two years. The governing
principle is that clients will be able to choose from within the Nedcor Group
which brand and business grouping meets their preference."
The presentations also provided detail on the considerable progress made to date
with integration process. A specialised integration team, headed by Izak Botha,
oversees the implementation of the plan allowing Nedcor`s executive and
operational management teams to also focus on running the business.
According to the integration team the major areas of synergies and cost savings
are IT, shared services, corporate and commercial banking and wealth management.
The integration process and the resulting availability of a wider range of
delivery channels to clients will see a reconfiguration of the branch network.
This will involve closure of some branches. Every effort will be made to re-
skill or re-deploy affected staff members to other areas of the Group, though
some retrenchments are anticipated.
The Group`s integration plan will see it handing back four domestic banking
licences, leaving it with Nedbank Ltd (previously Nedcor Bank Ltd), Peoples Bank
Ltd, Imperial Bank Ltd and Gerrard Private Bank (an offshore licence).
The Group`s restructure plan is subject to approval in terms of section 54 of
the Banks Act, and other regulatory conditions.
Issued by: Nedcor Ltd
Contact: Nedcor Group Media Relations
Gayle Rodrigues 011 294 0372/083 307 6484
Date: 28/10/2002 12:15:00 PM Produced by the JSE SENS Department
