Nedbank expects its full-year headline earnings to be as much as 3% higher after finishing the year slightly stronger than expected.
The group said on Thursday that HEPS for the year to end-December is expected to be 1%-3% higher in a range of 3,667c-3,740c.
Its net asset value per share is expected to be between 24,760c and 25,241c, an increase of 3%-5%.
Return on equity is expected to be 15.3%-15.5% from 15.8% a year ago.
In August last year, Nedbank announced it had sold its 21.2% shareholding in ETI for $100m (then about R1.7bn) to Bosquet Investments. The transaction was completed in December after the necessary regulatory approvals were received.
The disposal represented a reset of Nedbank’s strategy in the broader African continent, with a clear focus on the Southern African Development Community and East Africa regions in businesses Nedbank Group owns and controls.
The group said on Thursday that, as a result of the ETI disposal and in terms of IFRS accounting standards, the cumulative foreign exchange and fair value losses relating to the equity accounting treatment of the interest in ETI over time, previously recognised via other comprehensive income (OCI), had to be recycled to profit or loss in the 2025 reporting period.
As a result, basic EPS for the year will decrease by 52%-55% to a range of 1,625c-1,733c.
The recycling of the cumulative forex and fair value losses recognised via OCI is excluded from headline earnings and therefore has no impact on HEPS or net asset value, it said.
Business Day reported recently that the proposed deal by Nedbank to acquire a controlling stake in Kenya-based lender NCBA has moved a step closer.
The Kenyan Capital Markets Authority has granted an exemption from the requirement that the South African lender extend a mandatory takeover offer for 100% of NCBA shares in terms of the Capital Markets (Takeovers and Mergers) Regulations.
The granting of the exemption was one of the conditions of the proposed deal.
South Africa’s fourth-largest bank aims to spend almost R14bn for a controlling stake in Kenya-based NCBA, a lender Standard Bank is said to have been courting too.
Business Day reported in January that Nedbank, which relies on South Africa for 80% of its earnings, is looking to spread its wings to the fast-growing East Africa region after a disastrous investment in West Africa that ended in a costly withdrawal.
In January, Nedbank offered R13.9bn for 66% of NCBA.
NCBA’s main shareholders include the Kenyatta family and that of former Central Bank of Kenya governor Philip Ndegwa. It has a 60-million-strong client base.
NCBA also operates in important economies in East Africa — Tanzania, Uganda and Rwanda — and has a “digital offering in Ghana and Ivory Coast”.
Nedbank will publish its annual results on March 3.
With Kabelo Khumalo
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