Fresh from reporting preprovision adjusted operating profit of more than £1bn (R24bn) for the first time in its 50-year history, Investec, the niche private banking and wealth management group, is ramping up growth initiatives in its anchor geographies, SA and the UK.
The group, in its growth blueprint, said it was transitioning to end-to-end corporate banking in its UK business by adding transactional banking capabilities.
To this end, the company on Thursday said it would over the next three years deploy capital to gain market share.
“There is an opportunity to create significant value by leveraging our high-touch approach and sector expertise to gain market share. The group plans to invest in this UK capability over the next three years. We expect about 1,000 clients to have at least two products and to achieve a market share of 2% by full-year 2030,” the Fani Titi led Anglo-UK group said.
The company is also looking to make serious inroads in private banking in the UK, where it aims to more than double its client base.
The lender is aiming to have a market share of about 18% in the private banking segment in the UK, which will translate to about 18,500 clients in the next five years, from 7,500 now.
“We are entering the next phase of growth for our UK Private Client business to accelerate the execution of a comprehensive banking proposition. This will deepen client engagement, increase client acquisition, support higher HNW [high net worth] mortgage growth, and contribute to a reduced cost of funding,” it said.
Investec is also not resting on its laurels in its home market, where it was established in 1974. The group, listed in Johannesburg and London, aims to accelerate its client acquisition strategy in SA.
The company also plans to make inroads in the increasingly competitive mid-corporate banking segment, a sector with many businesses in SA.
Investec’s plan is to create a single platform for mid-sized SA corporates to holistically manage their banking requirements.
“Given our current low market share in this large and growing segment, the potential to create value for the group is significant. We are well-positioned to become the strategic partner that offers the Investec private client experience to businesses,” the company said.
“Our plan is to fast-track the delivery of this proposition, enabling accelerated transactional banking client acquisition to about three times the current base of 2,700, translating to a market share of [about] 8% by full-year 2030.”
The group’s strategy will face stiff competition, as its domestic rivals are also targeting mid-sized corporates for growth.
Nedbank is restructuring the business to also place great emphasis on mid-sized corporates, typically those businesses with a revenue per annum of R1bn and above — with the lender target a market share of 25%.
Investec reported a return on equity (ROE) of 13.9% for the year to end-March, in line with guidance provided previously.
Preprovision adjusted operating profit for the year to end-March grew 7.8% to £1.04bn, surpassing the £1bn level for the first time yet. Titi said it demonstrated the underlying strength of Investec’s differentiated client franchises.
Customer deposits increased 4.1% to £41.2bn driven by strong growth in nonwholesale and retail deposits in both geographies. Funds under management in the Southern African business increased 11.8% to £23.4bn.
Net inflows in Investec’s discretionary and annuity funds of R16.9bn were partly offset by foreign exchange translation losses and nondiscretionary outflows of R9.8bn, it said.
The group’s associate investment in Rathbones reported funds under management and administration of £104.1bn at end-March. Investec owns 41.25% of Rathbones.
The group’s strong cash position has allowed it to launch a share buyback programme of R2.5bn, taking its total buyback programme since 2022 to nearly R10bn.
Update: May 22 2025
This story has been updated with new information.
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