James, we had a strong performance
in the FY22 financial year.
Give us your overall impressions.
Jaco I guess the first when you have a
strong performance, it's a reflection
of the support from our clients and
really a big thank you to our client
base for trusting us as their
banking partner.
Firstly, look the results are really good,
you know, strong uptick in PBT,
in return on equity.
So, very pleasing to see.
What's also nice to see is the
growth in advances.
That's up 18%, so lending to
our clients has increased.
We've actually, new business written
or new lending and refinancings of
R126 billion this year, which I think
reflects the confidence of our clients,
growing confidence in the, particularly,
South African economy.
But also some of that was more
widely in the rest of Africa.
And maybe some of that confidence
is reflecting in what we're seeing in
the event market.
You know, for example, M&A with
the Heineken Distell deal,
the Taylor Maritime deal, too,
Grindrod Shipping.
These are deals that signal the
confidence of international
investors in South Africa.
And those are examples where
RMB has played an instrumental
role and there are others that are similar.
So yeah, we're seeing more confidence.
We're very proud Jaco of our ESG
performance this year.
You know, we set ourselves a
bold target.
We wanted to facilitate ESG-related
deals of R26 billion, in our first year
of that target.
R25 billion.
And we made it at R26 billion.
So we're delighted to achieve that.
We are seeing also a strong
improvement in the quality of
our loan book.
So we were able to reverse
provisions, which I guess helped
our results.
And so when you pull all of this
together, the truth of it is that we can
go into '23 really feeling quite
confident about the quality of the market.
South Africa particularly, but the quality
of RMB and its business.
Maybe Jaco I can turn the tables a bit.
You're closer to the numbers.
Can I ask you - share some of the
headline detail?
James, so PBT was up 17%, but I think
the important thing here is 19% up on
the level that we were in 2019
pre-pandemic.
So that's a very good result.
ROE is 22.1%, so significantly up from
last year and I think both those metrics
are fantastic in the current environment.
As you mentioned, very good growth
in advances.
It was back ended in the financial year
so we're really going to see the benefit
coming out in the next financial year
from an NAR perspective.
And maybe if you can cover some
of the detailed underlying business
unit performances across RMB.
Yeah, happy to do so.
Starting with private equity.
Actually, they had a fantastic year
this year, profit up 72%, but I think
the important thing, annuity income
up 32%.
We had the opportunity to invest in
new businesses, so close to a billion
rand invested in the current financial
year and unrealised profit up 32%.
That's a fantastic performance.
I think secondly, banking division up
20% in the current financial year.
Another exceptional performance.
If you unpack that, strong lending growth
and that really provided opportunity for
structuring commitment fees coming
through in the current financial year.
So the fee income side of the business,
very good.
As you mentioned, the benefit of the
unwind of ECL or credit provisions in
the current year further bolstered
their results.
If we then turn to markets, up 11% in the
current financial yea.
That is a very strong performance given
the macro environment and also coming
off a 28% growth in the prior financial year.
If you think about where it came from,
equities, FX and commodities, given the
run in commodities and the FX volatility
that we saw in the current financial year,
really supported flow trading and client
flows into that business.
So that was really a very good result that
came through for us.
James I think if we then turn to Ashburton,
your thoughts about their performance?
Yeah, so Jaco Ashburton are now
a profitable business.
It's been in the broader stable, aligned
with RMB now for a little while and we are
seeing the real benefits of much tighter
integration with our corporate and
investment banking teams.
And that's translating into inflows into all
of our funds.
And, you know, I guess as we look forward,
we think that there's quite a lot of runway
now for this business, for the Group.
James, if we think about broader Africa,
we've historically said that's going to be
one of our growth engines.
They had a slightly softer performance
in the current year.
But what are your thoughts about
how they're positioned?
I think the softness of the year really
is just a reflection of some of the
base provisions.
Last year we reversed some big
oil and gas provisions.
So actually, when you look at the
underlying performance of the business.
Actually, we are seeing strong
customer growth.
We're seeing good performances
across the board.
Zambia, probably a particular call-out.
Botswana, both really strong
performances in the current year.
More muted in Nigeria.
Some real structural issues
in that economy.
Oil production, FX availability.
So a little bit more muted.
But on balance, I do believe Jaco
that this is a portfolio that will
continue to drive growth for our Group.
James, then maybe turning to the
future a little bit.
I mean, we've seen an uptick obviously
in corporate activity in South Africa
coming through in the second half of
the year.
But the international environment is sticky.
So what are your thoughts about kind of
how we look into the '23 financial year and
what the opportunities are?
Sure.
It's always hard with a crystal ball.
I think firstly, we do believe that the
signs of of progress on the reform agenda
in South Africa are starting to be much
more encouraging.
And so we've seen the uptick in
lending as you mentioned.
That's really been from corporate
South Africa.
But I think with some of the
infrastructure rollout that's going to
start happening,
in power firstly, but in future in water
and rail, I think it gives us quite a
long runway where banks can play
a critical role in supporting this and
it'll flow through in our numbers.
When it comes to confidence, that
will in turn transmit into confidence
into the country.
And I do think we will continue to see
this theme of global investors showing
more interest in South Africa,
which is positive.
And this theme of ESG,
I touched on it.
You know, we've met our first year
targets of R25 billion.
We've set ourselves quite a bold
ambition of R35 billion in the next
financial year.
But we believe that with this growing
focus on these three topics - environment,
social, governance, that this is something
our clients really are focused on.
And so it's very much a long
term growth theme.
So when we add all of this together,
it's hard to know there's probably a
mild recession coming in Europe and
the UK, US still under question.
So anything can happen to change at the
moment, but we are at least confident
that we are able to kind of keep the
momentum that we've built in 2022.