Investec bank profits surge as legacy of financial crisis fades
Anglo-South African bank Investec reported strong profits for the six months to September yesterday, overcoming a fall in the rand.
Impairments fell by more than 20 per cent on the year, and are down to one-fifth of their £320m level seen three years ago, as the bank moves on from the financial crisis.
Pre-tax operating profits rose 8.6 per cent on the year to £240.8m. On a currency-neutral basis, to exclude the effect of exchange rate movements, profits rose 2.8 per cent.
The bank’s wealth and investment profits improved the most, shooting up 23.3 per cent to £38m.
Asset management profits were next best, up 6.6 per cent to £76.7m. And specialist banking profits increased six per cent to £126.1m.
Investec has sold its troubled Australian arm, and hopes to look for more growth globally in the future.
It plans to tap investors in growth markets from the US to South Asia.
“We have done a lot of work preparing for the future, making sure the infrastructure is there, setting up asset management sales offices throughout the world – 75 to 80 per cent of the world’s investable pools are in North America,” Investec’s managing director Bernard Kantor told Morning Wire
The firm has also spread those distribution offices across Africa, Asia and the Middle East.
“Our infrastructure can cope with a lot more inflows, and we’re going after those inflows – we’ve been quite successful with sovereign wealth funds,” Kantor said.
Investec’s shares rose in early trading on the results, but ended the day down 0.42 per cent at 591.50p.