Nedbank earnings up 36 per cent

JOHANNESBURG – South Africa’s Nedbank Group increased full year headline earnings per share by 36 per cent, driven by its corporate and retail businesses, the company said yesterday.

The banking group, majority owned by insurer Old Mutual Plc, said headline earnings increased by 40 per cent to 4,435 billion rand, with the results for the year to end-December ahead of management expectations. “2006 has been a year of growth for Nedbank Group.This is reflected in improved financial performance and in the growth of our distribution network, client base and market share.We have created a strong platform for sustainable growth,” Nedbank Chief Executive Officer Tom Boardman said in a statement.Fully diluted headline EPS increased by 36 per cent to 1,076 cents.One Johannesburg analyst said the results was as expected.”It is in line with what we expected and there is nothing spectacular in the results,” the analyst said.Headline EPS is the key profit measure for South African firms and excludes non-trading, capital and certain extraordinary items.Shares in Nedbank gained 0,6 per cent to 143,36 rand, in line with the JSE Securities Exchange’s banking sector, which rose 0,56 per cent.The group said its return on equity ratio (RoE) increased to 18,6 per cent from 15,5 per cent.Nedbank Group said advances growth remained robust but it expected growth to slow due to the effects of a series of interest rate increases by the South African central bank since mid-2006.The impairments charge for bad loans increased by 24,7 per cent to 1,483 billion rand while the impairments charge as a percentage of average advances improved to 0,52 per cent for the full year from 0,61 per cent for the first half of the financial year.”The group anticipates that the impairment charge will increase in the medium to long term as a result of the recent interest rate increases, combined with higher levels of household indebtedness,” the group said.Nampa-Reuters”2006 has been a year of growth for Nedbank Group.This is reflected in improved financial performance and in the growth of our distribution network, client base and market share.We have created a strong platform for sustainable growth,” Nedbank Chief Executive Officer Tom Boardman said in a statement.Fully diluted headline EPS increased by 36 per cent to 1,076 cents.One Johannesburg analyst said the results was as expected.”It is in line with what we expected and there is nothing spectacular in the results,” the analyst said.Headline EPS is the key profit measure for South African firms and excludes non-trading, capital and certain extraordinary items.Shares in Nedbank gained 0,6 per cent to 143,36 rand, in line with the JSE Securities Exchange’s banking sector, which rose 0,56 per cent.The group said its return on equity ratio (RoE) increased to 18,6 per cent from 15,5 per cent.Nedbank Group said advances growth remained robust but it expected growth to slow due to the effects of a series of interest rate increases by the South African central bank since mid-2006.The impairments charge for bad loans increased by 24,7 per cent to 1,483 billion rand while the impairments charge as a percentage of average advances improved to 0,52 per cent for the full year from 0,61 per cent for the first half of the financial year.”The group anticipates that the impairment charge will increase in the medium to long term as a result of the recent interest rate increases, combined with higher levels of household indebtedness,” the group said.Nampa-Reuters