Nedbank Sees Reforms Aiding $67 Billion South Africa Opportunity

Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomePMN BusinessNedbank Sees Reforms Aiding $67 Billion South Africa OpportunityOngoing reforms in South Africa could unlock a 1 trillion-rand ($67-billion) opportunity for lenders operating in the continent’s biggest economy, the chief executive officer of Nedbank Group Ltd. said.Author of the article:Adelaide Changole and Jennifer Zabasajja You can save this article by registering for free here. Or sign-in if you have an account.(Bloomberg) — Ongoing reforms in South Africa could unlock a 1 trillion-rand ($67-billion) opportunity for lenders operating in the continent’s biggest economy, the chief executive officer of Nedbank Group Ltd. said.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountSouth Africa is seeing benefits from efforts to improve outcomes in its energy, logistics and water industries and from addressing crime and corruption, Jason Quinn said. The push has spurred optimism among investors and positioned the economy for what could be its biggest infrastructural expansion in a decade. “There is a 1.1 trillion-rand opportunity of infrastructure investment and we are really well positioned as Nedbank to participate,” Quinn said in an interview Tuesday. Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againSouth Africa’s reforms have been driven by Operation Vulindlela, an initiative set up by President Cyril Ramaphosa and the National Treasury in 2020 to remove regulatory and administrative bottlenecks that have curbed investment and constrained economic growth to less than 1% on average annually over the past decade. The unit has since expanded to target water infrastructure, municipal performance, spatial inequality, digital transformation and visa reforms.The country is working to crowd in private investment to bridge a yawning infrastructure-funding gap caused by years of under investment by state-owned enterprises. Nedbank has downgraded its forecast for growth in South Africa’s gross domestic product this year to 1.3% as the war in the Middle East weighs on the economy, but sees reforms accelerating GDP expansion to 1.9% in the next two years, with 2.5% possible by 2030, which will create opportunities for significant infrastructure development with it, Quinn said. “It’ll create a lot of jobs and be really good for the economy,” he said.Earlier, Nedbank said its first-half profit rose 0.1% to a record 8.41 billion rand in the six months through June. Its interim dividend of 10.52 rand was also the biggest to date.While the headline numbers were “flat,” underlying earnings growth was strong after stripping out about 1 billion rand generated by its investment in Ecobank Transnational Inc. in the first half of last year, Quinn said.Nedbank sold its stake in Ecobank in the second half of last year. The lender’s shares rose as much as 4.7% to the highest since March 5 and traded 3.7% higher by 12:12 a.m. in Johannesburg.Profit growth was supported by a 4% increase in net interest income and a 10% gain in fees and commissions, which offset a 3% increase in operating expenses. A 26% surge in impairments lifted the bank’s credit-loss ratio to 95 basis points — near the top of the board-approved target of 60 basis points to 100 basis points. The bank expects interest-income growth to continue to improve to about 7% for the full year, though risks remain tilted to the downside. It also sees underlying growth momentum across its businesses continuing into the full year, which will support an improvement in headline earnings growth for the 12 months, Quinn said. This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.Return on equity is expected to remain above 15% in 2026.Meanwhile, the lender is gearing up its expansion into East Africa, with plans to get regulatory approval for its acquisition of a majority stake in Kenyan lender NCBA Group Plc in the the third quarter. It expects to complete the transaction in the following three-month period. “The combination of our businesses I think creates a really strong proposition for collaboration between the two businesses,” Quinn said. “Nedbank will bring corporate and investment banking type activities into Kenya through NCBA, and then NCBA has incredible digital platforms which we think are scalable and transportable into different markets, so I am really looking forward to consummating that transaction.”Sign up here for the daily Next Africa newsletter and subscribe to the Next Africa podcast on Apple, Spotify or anywhere you listen.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.