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Johannesburg - Investec [JSE:INL] flagged on Thursday that full-year earnings probably fell as much as 27% on the back of a poorly performing investment bank and a loss in its Australian unit.
The $2bn bank that is also listed in London said it was hit by a drop in principal transactions in the year to the end of this month.
Chief executive Stephen Koseff told Reuters the bank had to close down a lending division last year.
“We just need to clear that problem loan book which we are in the process of doing. We have written the book down to clearance levels,” he said.
Investec said third-party assets under management increased over 11% to £98.8bn by the end-February, which included £7.4bn worth of assets from the British investment group Evolution that it bought last year.
As part of its strategy to cut its reliance on traditional lending, Investec has been diversifying its business. Its latest move was to buy Irish unlisted broker and wealth manager NCB for €32m earlier this year.
Investec said deposits rose 4% while lending increased 1% during the 11-month period.
Koseff said the company expects an improved environment and impairments starting to decline this year, depending on whether European economies can hold up.
Investec said full-year adjusted earnings per share and headline EPS are expected to be 22-27% lower than the prior year. The bank’s full-year profit dipped by 5% in the previous year, hit chiefly by Irish real estate losses.
The $2bn bank that is also listed in London said it was hit by a drop in principal transactions in the year to the end of this month.
Chief executive Stephen Koseff told Reuters the bank had to close down a lending division last year.
“We just need to clear that problem loan book which we are in the process of doing. We have written the book down to clearance levels,” he said.
Investec said third-party assets under management increased over 11% to £98.8bn by the end-February, which included £7.4bn worth of assets from the British investment group Evolution that it bought last year.
As part of its strategy to cut its reliance on traditional lending, Investec has been diversifying its business. Its latest move was to buy Irish unlisted broker and wealth manager NCB for €32m earlier this year.
Investec said deposits rose 4% while lending increased 1% during the 11-month period.
Koseff said the company expects an improved environment and impairments starting to decline this year, depending on whether European economies can hold up.
Investec said full-year adjusted earnings per share and headline EPS are expected to be 22-27% lower than the prior year. The bank’s full-year profit dipped by 5% in the previous year, hit chiefly by Irish real estate losses.
