Nedbank Group Limited (OTCPK:NDBK.Y) Update / Briefing Transcript

Nedbank Group Limited Update Summary Company Overview - Company: Nedbank Group Limited (OTCPK:NDBK.Y) - Date of Briefing: December 03, 2025 Key Industry Insights - Industry: Banking and Financial Services - Market Conditions: The macroeconomic environment is improving, with lower interest rates and inflation contributing to better disposable income and growth in secured lending portfolios [5][6][14] Core Financial Performance - Non-Interest Revenue (NIR): Expected to grow below mid-single digits for the full year, primarily due to delays in deal flow and the impact of a one-off commercial settlement with Transnet [1][15][80] - Expenses: Growth in expenses was mid- to upper-single digits, with expectations to remain above mid-single digits for 2025, excluding one-off settlements [1][2] - Return on Equity (ROE): Projected to be around 15% or slightly higher for the full period [2] Strategic Developments - Share Buybacks: Approximately 10.5 million shares repurchased for ZAR 2.4 billion at an average price of just below ZAR 230 per share [3][21] - Acquisition of ICORCA: Completed on December 1, 2025, aimed at enhancing presence in the SME and mass market segments [3][26] - Organizational Restructure: Completed in July 2025, aimed at improving the profile and performance of the Commercial Banking business [3][10] Business Segment Performance - Personal and Business Banking (PPB): Strong growth in value-added services and client gains, with a focus on cross-selling following the organizational restructure [1][70] - Corporate and Investment Banking (CIB): Delays in deal closures, particularly in renewable energy and infrastructure sectors, pushing expected growth into 2026 [6][62] - Retail Loan Growth: Notable improvement in secured lending, with a halt in market share losses in personal loans, although card lending remains weak [5][30] Risk Management and Capital Adequacy - CET1 Capital Adequacy Ratio: Remains above the target range of 11%-12%, indicating strong capital position [2] - Credit Quality: Improvement across most portfolios, with a clean corporate book and reduced watch list clients compared to previous years [17][18] Future Outlook - Growth Projections: Anticipated mid- to upper-single digit growth in loans and advances for 2026, driven by infrastructure spending and improved macroeconomic conditions [78] - Market Positioning: Focus on leveraging the ICORCA acquisition to penetrate the mass market and enhance cross-selling opportunities [26][59] Additional Considerations - Benchmark Reform: Transitioning from JIBAR to ZARONIA is well-managed, with no expected risks to the business [46] - Competitive Landscape: Noted aggressive pricing in the renewable energy sector affecting deal closures, highlighting the importance of strong client relationships [66] This summary encapsulates the key points from the Nedbank Group Limited update, focusing on financial performance, strategic initiatives, and market outlook.