<\/p>\n
Investec expects headline earnings to remain broadly flat for the year to 31 March 2026, with modest growth at group level offset by a more subdued performance in its Southern African operations, according to its pre-close trading update.<\/p>\n
The group has guided headline earnings per share between 72.6p and 74.1p, representing flat to 2% year-on-year growth.<\/p>\n
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Revenue growth was partly offset by \u201cthe negative impact of lower average interest rates\u201d, which compressed margins.<\/p>\n
Investec\u2019s shares dropped 2.6% at around 11am on Thursday, trading hands at R125.23.<\/p>\n
Group CEO Fani Titi said during a media briefing that Investec is nevertheless comfortable with its results.<\/p>\n
\u201cWe have seen some pleasing growth in our loan book. We\u2019ve also indicated in our SA business that we are looking for return on equity of around 18%, which is very competitive in the market.\u201d<\/p>\n
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At a group level, performance was supported by stronger client activity, continued inflows into its wealth business and higher lending volumes.<\/p>\n
Core loans increased by 13.3% in reported currency to \u00a336.3 billion (R815.6 billion), benefitting from the 9.5% appreciation of the rand against pound sterling compared to the previous year.<\/p>\n
Non-interest revenue was a key driver of income, supported by increased transaction and fee-based activity.<\/p>\n
Investec pointed to strong fee generation across its banking franchises, alongside higher annuity income from its South African wealth and investment division.<\/p>\n
Funds under management in the Southern African wealth business rose 26.7% to \u00a329.6 billion (R665.4 billion), reflecting strong inflows and market support.<\/p>\n
Outlook\u00a0<\/p>\n
Looking ahead, the group said it remains focused on growing market share, deepening client relationships and improving returns, while maintaining capital discipline. It expects return on equity to remain within its medium-term target range of 13% to 17%.<\/p>\n
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However, it cautioned that the global outlook remains uncertain, noting that further escalation in geopolitical tensions could affect key macroeconomic variables, including inflation, interest rates and growth.<\/p>\n
\u201cThe environment has been volatile for quite a long time and now it\u2019s obviously heightened by the Iran war,\u201d Titi says.<\/p>\n
\u201cBut we generally hold higher levels of liquidity and in particular dollar liquidity from a South African perspective \u2013 as well as high levels of capitalisation, which enables us to absorb shocks that come about.\u201d<\/p>\n
He points out that Investec typically targets clients that are more \u201cresilient\u201d. \u201cFrom the global financial crisis until now, our clients have been resilient over a number of different stress situations and crises.\u201d<\/p>\n
He conceded that the outlook for the global economy \u2013 and for the economies where the group operates \u2013 remains uncertain.<\/p>\n
\u201cWe don\u2019t know how deep this war will go and for how long. Safe to say, that for the South African economy, we\u2019re in a better place today than around Covid. The monetary policy outlook is also much better from a UK perspective,\u201d Titi says.<\/p>\n
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#Investec #flags #flat #earnings #wealth #inflows #support #income<\/p>\n","protected":false},"excerpt":{"rendered":"
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