NEDBANK GROUP EARNINGS DOWN

MBABANE - Nedbank   Group is relieved to remain resilient, open for business and profitable, with capital and liquidity ratios well above prudential requirements in these challenging times.

Nedbank is one of Africa’s largest banking groups, with operations in the country, Namibia, Mozambique, Lesotho and Zimbabwe, among other countries.

Nedbank Group 2020 first-half results, according to a correspondence copied to this publication yesterday, highlighted that headline earnings declined 69 per cent to E2.1 billion according to local currency in the six months to end in June.

The decline was blamed on the significant increase in impairments, including E2.9 billion related to IFRS-9 macro-model adjustments and judgmental overlays for estimated COVID-19-related impacts and expected future job losses.

The Group further heeded South Africa’s Reserve Bank call not to declare an interim dividend.

Following the release of the results early yesterday, the Group’s Managing Executive Nedbank Africa Regions Dr Terence Sibiya virtually addressed the Eswatini media yesterday at the local bank’s boardroom in Mbabane during lunch hour. 

 Dr Sibiya acknowledged that the six months had been tough due to the distress brought by COVID-19, highlighting that they were not out of the woods yet.

However, Sibiya celebrated some of the positives that included the bank’s ability to maintain a strong balance sheet as well as providing payment relief for over 375 000 clients amounting to E119 billion of loans, reduced various client fees amounting to E104 million, and launching digital innovations.

operation

Asked to narrow down on the performance of the Eswatini Nedbank operation, Dr Sibiya said the specific results for the country would be known next month.

Dr Sibiya assured that they would continue to assist clients in these challenging times. He did concede that some sectors, especially in the tourism sector, could struggle to repay their debts.

Nedbank Swaziland Manaing Director Fikile Nkosi made a stop at the boardroom during the virtual address by Sibiya. Despite celebrating the digital innovations brought by COVID-19, she politely asked  to react once the Eswatini results have been released next month.

Meanwhile, in the statement copied to this publication, Nedbank Group Chief Executive Mike Brown described the period as one which presented “unprecedented health, economic and social challenges that have had a material impact on individuals, families, businesses, societies and countries.

 “Our primary focus was on remaining resilient and ensuring the health and safety of our staff and clients; invoking business continuity plans; ensuring IT systems stability; supporting our clients in managing their finances through this very difficult period; and managing liquidity, credit risk, capital and discretionary costs closely.” 

lockdown

“While operating under lockdown we provided payment relief for over 375 000 clients amounting to R119 billion of loans, reduced various client fees amounting to R104 million, and launched digital innovations using foundations from our managed evolution technology roll-out to assist our clients during the lockdown, including launching the Avo app and Tap on Phone payments functionality. Importantly, these capabilities enabled digital sales to increase from 18 to 53 per cent,” he was quoted saying.

The group, on the other hand, expects South Africa’s economy to contract by seven per cent in 2020; with the second quarter the most affected by the pandemic due to stringent lockdown regulations. It warned that Covid-19 had escalated from an economic crisis into a social one.

Nedbank Swaziland has also offered millions of Emalangeni in relief during these tough times. To ease the pressure on individual clients and provide the much-need relief to their business clients, the bank  waived  transactional fees on its digital platforms. This is the Nedbank Money App and Nedbank Online Banking (Internet Banking) effective from April 2020 to June 30, 2020. This is one of countless relief measures during the period under review.

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