REG - Investec PLC - Final Results
19/05/2022 07:00
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RNS Number : 0182M Investec PLC 19 May 2022
Investec Limited Investec plc
Incorporated in the Republic of South Africa Incorporated in England and Wales
Registration number 1925/002833/06
Registration number 3633621
JSE share code: INL
LSE share code: INVP
NSX share code: IVD JSE share code: INP
ISIN: GB00B17BBQ50
BSE share code: INVESTEC
LEI: 2138007Z3U5GWDN3MY22
ISIN: ZAE000081949
LEI: 213800CU7SM6O4UWOZ70
Investec (comprising Investec plc and Investec Limited) - Unaudited combined
consolidated financial results for the year ended 31 March 2022
Group results summary for the year ended 31 March 2022 (FY2022) compared to 31
March 2021 (FY2021)
• Adjusted earnings per share increased 90.7% to 55.1p (FY2021: 28.9p)
at the top end of previous guidance and ahead of comparable pre-COVID levels.
• Funds under management (FUM) increased 9.2% to £63.8 billion (31
March 2021: £58.4 billion) underpinned by net inflows of £1.9 billion and
improved market levels. Market volatility in the last quarter negatively
impacted FUM at year end.
• Net core loans grew 13.2% to £29.9 billion (31 March 2021: £26.4
billion) driven largely by residential mortgage and corporate lending growth
in both geographies.
• Revenue grew 21.3% as our franchises effectively supported our clients
and benefitted from post-pandemic economic recovery.
• The cost to income ratio improved to 63.3% (FY2021: 70.9%) with the
increase in fixed operating expenditure well contained at 1.1%. Operating
costs increased 6.0% overall, largely driven by higher variable remuneration.
• Pre-provision adjusted operating profit increased 50.1% to £716.2
million (FY2021: £477.0 million), 15.7% ahead of March 2019 (pre-COVID).
• The credit loss ratio improved to 8bps (FY2021: 35bps). Expected
credit loss impairment charges were 71.0% lower, due to limited default
experience in both geographies, and good recoveries in South Africa. The Group
has maintained a level of post-model overlays given the uncertain economic
outlook.
• Return on equity (ROE) was 11.4% (FY2021: 6.6%) and return on tangible
equity (ROTE) was 12.3% (FY2021: 7.2%).
• Tangible net asset value (TNAV) per share increased 12.5% to 476.6p
(31 March 2021: 423.6p). Net asset value (NAV) per share increased 11.4% to
510.0p (31 March 2021: 458.0p).
• Maintained strong capital and liquidity positions to support growth.
On full adoption of the advanced internal ratings based (AIRB) approach,
Investec Limited's CET1 ratio at 31 March 2022 would on a pro forma basis
increase by 200bps to c.16%, expanding capital optionality.
• Shareholders approved the distribution of 15% of Ninety One.
• The Board has proposed a final dividend of 14.0p per share, resulting
in a full year dividend of 25.0p per share (FY2021: 13.0p). The payout ratio
of 45.4% is within the Group's 30% to 50% payout range.
Fani Titi, Group Chief Executive commented:
"The Group's performance for the 2022 financial year is testament to the
strength of our client franchises, disciplined strategic execution, and the
commitment of our people to support our clients. We achieved adjusted earnings
per share of 55.1p which is at the top end of previous guidance and ahead of
comparable pre-COVID levels. Post-pandemic economic recovery supported these
results.
With the pending distribution of 15% of Ninety One to shareholders, Investec
would have returned an aggregate value of approximately £1.6 billion or c.R32
billion (per Ninety One closing share price on 16 May 2022) to shareholders
through the demerger and distribution on successful completion.
I am also pleased that the Board has proposed a final divided of 14p per share
resulting in a full year dividend of 25p per share.
We have strong liquidity and capital to support growth, with significant
capital optionality in South Africa. We remain committed to our medium-term
targets.
The Group is well positioned to serve its carefully chosen client base and
continues to navigate the uncertain outlook emanating from ongoing
inflationary pressures and the economic effects of the invasion of Ukraine."
Key financial data
This announcement covers the results of Investec plc and Investec Limited
(together "the Investec Group" or "Investec" or "the Group") for the year
ended 31 March 2022 (FY2022). Unless stated otherwise, comparatives relate to
the Group's operations for the year ended 31 March 2021 (FY2021). The average
Rand/Pound Sterling exchange rate appreciated by c.5% relative to FY2021.
Performance FY2022 FY2021 Variance % Neutral currency
change % change
Total operating income before expected credit losses (£'m) 1 990.4 1 641.1 349.3 21.3% 18.6%
Operating costs (£'m) (1 233.9) (1 164.5) (69.4) 6.0% 4.0%
Adjusted operating profit (£'m) 687.4 377.6 309.8 82.1% 77.0%
Adjusted earnings attributable to shareholders (£'m) 505.2 268.3 236.9 88.3% 84.0%
Adjusted basic earnings per share (pence) 55.1 28.9 26.2 90.7% 85.8%
Basic earnings per share (pence) 52.0 25.2 26.8 106.3% 101.2%
Headline earnings per share (pence) 53.3 26.6 26.7 100.4% 95.1%
Dividend per share (pence) 25.0 13.0
Dividend payout ratio 45.4% 45.0%
CLR (credit loss ratio) 0.08% 0.35%
Cost to income ratio 63.3% 70.9%
ROE (return on equity) 11.4% 6.6%
ROTE (return on tangible equity) 12.3% 7.2%
Balance sheet FY2022 FY2021 Variance % change Neutral currency % change
Funds under management (£'bn) 63.8 58.4 5.4 9.2% 7.4%
Customer accounts (deposits) (£'bn) 40.1 34.4 5.7 16.5% 12.9%
Net core loans and advances (£'bn) 29.9 26.4 3.5 13.2% 10.0%
Cash and near cash (£'bn) 17.2 13.2 4.0 29.7%
NAV per share (pence) 510.0 458.0 52.0 11.4%
TNAV per share (pence) 476.6 423.6 53.0 12.5%
Salient features by geography FY2022 FY2021 Variance % change Neutral currency % change
Investec Limited (Southern Africa)
Adjusted operating profit (£'m) 387.5 251.6 135.9 54.0% 46.7%
Cost to income ratio 53.9% 58.7%
ROE 11.7% 9.4%
ROTE 11.7% 9.5%
CET1 14.0% 12.2%
Leverage 7.4% 7.6%
Investec plc (UK & Other)
Adjusted operating profit (£'m) 299.9 126.0 173.9 138.0% n/a
Cost to income ratio 70.5% 79.5%
ROE 11.2% 4.0%
ROTE 12.9% 4.8%
CET1 11.7% 11.2%
Leverage 9.2% 7.9%
Distribution of 15% holding in Ninety One
On 28 April 2022, shareholders approved the proposed distribution of 15% of
Ninety One (34p per share, per Ninety One closing share price on 16 May 2022).
The distribution is expected to be effective on 30 May 2022, subject to final
scheme approval by the court.
Outlook
The Group continues to successfully navigate the uncertain macro backdrop that
has persisted since the onset of the pandemic and has made significant
progress against the strategic goals outlined at the 2019 Capital Markets Day.
We have a strong balance sheet and robust liquidity levels, firmly committed
to our medium-term targets, and are well positioned to pursue growth
opportunities in our chosen markets.
The expected slowdown in global growth given high levels of global inflation
and increased geopolitical tensions present a downside risk to current
economic forecasts.
FY2023 guidance:
Based on financial performance for FY2022, current business momentum and a
macro-economic outlook with elevated forecast risk in the short term, the
Group currently expects:
• The revenue outlook to be underpinned by higher average interest rates
supporting margins, higher average lending books and increased activity levels
given expected GDP growth.
• The cost to income ratio to be within the Group target of <63%,
notwithstanding inflationary pressures and continued investment in technology.
• Normalisation of expected credit loss impairment charges and
consequent credit loss ratio increase towards the Group's revised
through-the-cycle (TTC) range of 25-35bps, with South Africa's TTC range
calibrated between 20bps and 30bps, and the UK between 30bps and 40bps.
• The distribution of Ninety One to result in a 65bps reduction in
Investec Limited's CET1 ratio and to have an immaterial impact on Investec
plc. The attributable contribution to adjusted earnings per share was c.3.4p
for FY2022.
• South Africa to continue to operate with a surplus capital position
given excess capital generation and the anticipated CET1 uplift on full
implementation of AIRB.
• Improvement in ROE towards the 12-16% Group target range, which we
expect to achieve by FY2024. This will be aided by capital management
initiatives.
Enquiries
Investec Investor Relations
Results: Qaqambile Dwayi
Tel: +27 (0) 11 291 0129
Carly Newton
Tel: +44 (0) 20 7597 4493
General enquiries:
Tel: +27 (0) 11 286 7070 or investorrelations@investec.com
Brunswick (SA PR advisers)
Graeme Coetzee
Tel: +27 (0) 63 685 6053
Lansons (UK PR advisers)
Tom Baldock
Tel: +44 (0) 78 6010 1715
Presentation/conference call details
Investec management will host its year-end results presentation live from
London on Thursday 19 May at 10h00 (SA) / 9h00 (UK) time.
Please register for the presentation at: www.investec.com/investorrelations
A live video webcast of the presentation will be available on www.investec.com
About Investec
Investec partners with private, institutional, and corporate clients, offering
international banking, investments, and wealth management services in two
principal markets, South Africa, and the UK, as well as certain other
countries. The Group was established in 1974 and currently has 8,300+
employees.
Investec has a dual listed company structure with primary listings on the
London and Johannesburg Stock Exchanges.
Johannesburg and London
Sponsor: Investec Bank Limited
Group financial performance
Overview
Pre-provision adjusted operating profit for FY2022 increased, supported by
continued client acquisition, increased client activity, growth in FUM and
higher average advances.
The revenue momentum experienced in the first half of the financial year
continued into the second half. Net interest income benefitted from higher
average interest earning assets and lower funding costs. Increased client
activity, higher lending turnover and supportive market conditions underpinned
the growth in non-interest revenue over the year. Fixed operating expenditure
was well contained in line with the Group's focus on cost efficiencies, while
variable remuneration increased given improved business performance.
Impairments were significantly lower given limited default experience and the
minimal impact from updated forward looking macroeconomic scenarios since
1H2022.
The prior year results reflected the effects of severe economic contraction
and rate cuts associated with COVID-19 which negatively affected client
activity, net interest margins, valuations, and impairments. Additionally,
risk management and risk reduction costs associated with the UK structured
products book were elevated in FY2021.
Pre-provision adjusted operating profit increased 50.1% to £716.2 million
(FY2021: £477.0 million).
Revenue increased 21.3% to £1 990.4 million (FY2021: £1 641.1 million).
Net interest income increased 21.5% to £945.3 million (FY2021: £778.1
million) driven by higher average interest earning assets and lower funding
costs.
Non-interest revenue (NIR) increased 21.1% to £1 045.1 million (FY2021:
£863.0 million).
• Net fee and commission income increased 9.3% to £818.2 million
(FY2021: £748.9 million) driven by improved client activity across the board
and higher average FUM in Wealth & Investment. The increase was partially
offset by the prior year wind down of Australia and lower equity capital
markets activity in the UK off a higher base.
• Investment income decreased to £28.0 million (FY2021: £32.0
million). The positive impact of the recovery of dividends and positive fair
value (FV) adjustments on certain investments (given improved markets) was
offset by the non-repeat of larger realisations and FV gains in the prior
year.
• Share of post-taxation profit of associates and joint venture holdings
increased to £79.6 million (FY2021: £42.5 million) driven by improved
performance from underlying investee companies post hard lockdowns in the
prior year and earnings growth from Ninety One.
• Trading income arising from customer flow increased to £128.3 million
from £35.6 million in the prior year, primarily driven by £87.3 million
lower risk management and risk reduction costs associated with the UK
structured products book (underpinned by risk mitigation strategies
implemented on the book and improving markets) and strong growth in SA trading
from increased client activity.
• Net trading losses arising from balance sheet management and other
trading activities were £21.1 million compared to £18.9 million in the prior
year due to currency and interest rate hedges on the balance sheet.
• Other operating income of £12.2 million (FY2021: £23.0 million)
reflects the fair value movements of the Ninety One shares held in the Group's
staff share scheme. These shares are reflected on the Group's balance sheet in
other assets. The corresponding liability is reflected in other liabilities
with changes in the value of the liability expensed through staff costs in
operating costs.
Expected credit loss (ECL) impairment charges decreased by 71.0% to £28.8
million (FY2021: £99.4 million) resulting in a credit loss ratio of 8bps (31
March 2021: 35bps; 1H2022: 7bps)
Asset quality remains strong, with exposures to a carefully defined target
market and well covered by collateral. Limited default experience, good
recoveries, and reversals of certain Stage 3 ECLs raised in prior year as
exposures cured, drove the decrease in ECL. Given the uncertain economic
outlook, the Group has maintained a level of post-model management overlays to
account for risks assessed as inadequately reflected in the models. There was
a net release of management overlays during the year of £2.9 million.
Operating costs increased 6.0% to £1 233.9 million (FY2021: £1 164.5
million)
Fixed operating expenditure was well contained, increasing by 1.1%. The
increase was primarily driven by higher variable remuneration given improved
business performance, partly offset by the non-repeat of one-off costs
associated with restructures (including related redundancies) and the closure
of operations in Australia in the prior year. The cost to income ratio
improved to 63.3% from 70.9% in the prior year.
Taxation
The taxation charge on adjusted operating profit was £143.3 million (FY2021:
£74.5 million), resulting in an effective tax rate of 22.1% (FY2021: 22.3%).
In the UK, the lower effective tax rate of 14.9% (FY2021: 27.2%) was driven by
higher deferred tax assets on the back of higher enacted tax rates. In SA, the
higher rate of 26.7% (FY2021: 20.5%) was largely driven by the impairment of
certain deferred tax assets.
Profit or loss attributable to non-controlling interests
The profit attributable to other non-controlling interests was £40.2 million
compared to a loss of £0.5 million in the prior year and is attributable to
the non-controlling interests in the Investec Property Fund (IPF).
Funding and liquidity
Customer deposits grew 16.5% to £40.1 billion (31 March 2021: £34.4 billion)
at 31 March 2022.
Over the same period, cash and near cash increased 30.3% to £17.2 billion
(£8.9 billion in Investec plc and R159.5 billion in Investec Limited).
The Group comfortably exceeds Basel liquidity requirements for the Liquidity
Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR).
Investec Bank Limited (consolidated Group) ended the year to 31 March 2022
with the three-month average of its LCR at 138.9% and an NSFR of 112.6%.
Investec plc reported a LCR of 457% and a NSFR of 145% at 31 March 2022.
Capital adequacy and leverage ratios
Capital and leverage ratios remain sound, ahead of Board-approved minimum
targets and regulatory requirements. The CET1 and leverage ratio were 14.0%
and 7.4% for Investec Limited (increased AIRB scope) and 11.7% and 9.2% for
Investec plc (Standardised approach) respectively.
Investec Limited made progress in the application to adopt AIRB for the
measurement of capital on certain portfolios currently on the Foundation
Internal Ratings Based (FIRB) approach. On full adoption of AIRB, the
pro-forma CET1 ratio would increase by 200bps at 31 March 2022. Investec plc
is in the early stages of a process to migrate from the Standardised approach
to the Internal Ratings Based (IRB) approach.
Segmental performance
Wealth & Investment
Adjusted operating profit from the Wealth & Investment business increased
22.6% to £123.1 million (FY2021: £100.5 million).
Wealth & Investment Southern Africa UK & Other Total
FY2022 FY2021 Variance FY2022 FY2021 Variance FY2022 FY2021
£'m £'m £'m % % in Rands £'m £'m £'m % £'m £'m
Operating income 106.6 83.6 23.0 27.5% 21.7% 347.2 319.5 27.7 8.7% 453.8 403.2
Operating costs (71.2) (57.5) (13.6) 23.7% 17.9% (259.5) (245.2) (14.3) 5.8% (330.7) (302.7)
Adjusted operating profit 35.5 26.1 9.3 35.7% 30.0% 87.7 74.3 13.3 17.9% 123.1 100.5
Totals and variance determined in £'000 which may result in rounding
differences.
Southern Africa Wealth & Investment (in Rands)
Adjusted operating profit for SA Wealth & Investment increased by 30.0% to
R720 million (FY2021: R554 million).
The business reported 9.5% growth in FUM to R364.6 billion (31 March 2021:
R333.0 billion) supported by positive investment performance, R12.1 billion of
discretionary and annuity net inflows (non-discretionary net inflows of R1.2
billion) and improved markets. The market volatility in the final quarter of
the financial year (driven by global inflationary concerns exacerbated by the
invasion of Ukraine), negatively impacted closing FUM at 31 March 2022.
Revenue grew by 21.7% supported by sustained inflows into the offshore
investment range and higher average discretionary and annuity FUM.
Non-discretionary brokerage also increased year-on-year, particularly in March
2022 given increased market volatility.
Operating costs increased 17.9%, driven by higher variable remuneration given
strong business performance, and an increased headcount of investment
specialists, wealth managers and information technology (IT) personnel.
Operating margins improved to 33.2% from 31.2% in FY2021.
UK & Other Wealth & Investment
Adjusted operating profit for UK & Other Wealth & Investment increased
17.9% to £87.7 million (FY2021: £74.3 million).
For the first three quarters of the financial year to 31 December 2021, market
recovery and continued net inflows resulted in record FUM of £46.1 billion.
However, the final quarter of the financial year was impacted by global market
volatility, resulting in closing FUM of £44.4 billion (FY2021: £41.7
billion). Net inflows for the year were £1.2 billion.
Revenue grew by 8.7% given supportive market conditions and net organic growth
in FUM of 2.9%. Commission income returned to normalised levels following the
exceptional transaction volumes seen in the prior year, resulting in a lower
average income yield year-on-year.
Operating costs were up 5.8% due to investment in technology, increased
discretionary expenditure as COVID-19 related restrictions eased, as well as
higher variable remuneration in line with business performance.
The UK domestic business (which accounts for 96.6% of FUM) reported an
operating margin of 27.0% (FY2021: 25.2%), while a combined operating margin
for UK & Other of 25.3% (FY2021: 23.3%) was achieved.
Specialist Banking
Adjusted operating profit from Specialist Banking increased 96.6% to £543.0
million (FY2021: £276.3 million).
Specialist Banking Southern Africa UK & Other Total
FY2022 FY2021 Variance FY2022 FY2021 Variance FY2022 FY2021
£'m £'m £'m % % in Rands £'m £'m £'m % £'m £'m
Operating income (before ECL) 721.7 580.3 141.4 24.4% 18.7% 720.4 618.0 102.3 16.6% 1 442.0 1 198.3
ECL impairment charges (3.1) (25.9) 22.8 (88.1%) (91.2%) (25.2) (71.2) 46.0 (64.6%) (28.2) (97.1)
Operating costs (369.0) (323.3) (45.7) 14.1% 8.9% (501.6) (502.9) 1.4 0.3% (870.5) (826.2)
(Profit) /loss attributable to NCI (0.3) 0.3 (0.6) (>100%) (>100%) - 0.9 (0.9) (100.0%) (0.3) 0.6
Adjusted operating profit 349.4 231.5 117.9 50.9% 45.0% 193.7 44.8 148.9 332.4% 543.0 276.3
Totals and variance determined in £'000 which may result in rounding
differences.
Southern Africa Specialist Banking (in Rands)
Adjusted operating profit for the SA bank increased 45.0% to R7 104 million
(FY2021: R4 898 million).
Revenue growth of 18.7% was positively impacted by recovery in NIR as the bank
saw increased client activity levels across the board, higher average interest
earning assets, lower funding costs and good client acquisition. This was
partly offset by investment write-downs on certain portfolios in the current
year and lower deal fees in Investec Property.
Net interest income increased 13.2% driven by higher average interest earning
assets and lower funding costs.
Non-interest revenue increased 33.0% driven by:
• Increased fee income on the back of higher lending and forex (FX)
turnover, and recovery of point-of-sale activity relative to the prior year.
• Higher dividend income and certain realisations off a low base.
• Trading income increased, driven by market share gains in select
markets, increased client flows and benefits arising from increased market
volatility. Balance sheet management and other trading income saw
mark-to-market (MTM) gains on certain interest rate and currency swaps.
- offset by
• Lower deal fees from Investec Property and negative FV adjustments on
certain investments.
ECL impairment charges decreased 91.2% to R51 million resulting in an
approximately zero percent CLR (FY2021: 18bps). The decline was due to limited
default experience, good recoveries, specific ECL impairment reversals and the
release of R71 million post-model overlays given credit performance and a
stable to improved macro-economic outlook relative to FY2021. The management
overlay at year end of R219 million (31 March 2021: R290 million) reflects
heightened uncertainty given inflationary pressures, and second-order economic
impacts from the invasion of Ukraine.
Operating costs increased 8.9% driven by higher personnel expenses due to
salary increases and higher variable remuneration given improved business
performance. Discretionary expenditure also increased as COVID-19 related
restrictions eased. Fixed costs were well managed increasing 4.2%. The cost to
income ratio was lower at 51.1% (FY2021: 55.7%).
Net core loans grew by 3.9% to R298.4 billion (31 March 2021: R287.3 billion).
Advances to private clients increased 4.2% driven by resi-mortgages, offset by
flat year-on-year growth in commercial real estate. Corporate lending
increased 3.3%, offset by elevated repayments and subdued credit demand given
continued low business confidence.
UK & Other Specialist Banking
Adjusted operating profit for the UK bank increased to £193.7 million
(FY2021: £44.8 million). The £148.9 million increase in profits was driven
principally by strong net interest income growth, lower risk management and
risk reduction costs related to the structured products book, reduced fixed
operating expenditure and lower ECL charges given limited stage 3 ECLs. Client
acquisition remained strong, with the Private Banking business growing its HNW
clients to 6 982, surpassing the three-year target of 6 500 clients by 31
March 2022.
Net interest income increased 20.9% driven by higher average lending books and
lower cost of funding, partially offset by the impact of the disposal of the
Australian corporate book in March 2021.
Non-interest revenue increased 8.8% due to:
• Significantly lower risk management and risk reduction costs
associated with the structured products book (£5.9 million for FY2022 vs
£93.3 million for FY2021).
• Higher fees from the Private Equity franchise due to strong
origination and distribution activities and higher advisory fees relative to
prior year.
- offset by
• Lower fees and commissions due to the wind down of Australia and a
reduction in equity capital markets activity off a high base.
• Reduced balance sheet management and other trading income due to costs
associated with the early redemption of a senior bond, MTM losses on balance
sheet management instruments and the non-repeat of MTM gains in the prior
year.
ECL impairment charges decreased 64.6% to £25.2 million primarily due to
lower specific impairments. The reduction in ECL resulted in a credit loss
ratio of 17bps (FY2021: 56bps). The management overlay totals £16.8 million
at 31 March 2022 (down £4.2million from £21 million at September 2021; up
from £16 million at March 2021). This movement in the overlay reflects:
• Increased modelled ECL given greater downside weightings,
• The reducing impact that the COVID-19 pandemic has on management's
underlying assumptions, and
• The increasing impact of greater global uncertainty given rising
inflation and geopolitical concerns.
Operating costs were broadly flat, declining by 0.3% year on year. The 5.3%
reduction in fixed costs was offset by an increase in variable remuneration in
line with improved business performance. The base includes one-off costs
associated with the implementation of restructures as part of the Group's
strategy to simplify and focus the business, including related redundancies
and the closure of operations in Australia. The cost to income ratio improved
to 69.6% (FY2021: 81.3%).
Net core loans grew by 17.0% (18.5% excluding Australia) to £14.4 billion (31
March 2021: £12.3 billion) driven by residential mortgages (up 35.5%) and
strong demand for corporate credit (up 10.2% (12.0% excluding Australia))
across several portfolios.
Group Investments
Group Investments includes the 25% holding in Ninety One*, 47.4% stake in the
IEP Group, 24.31% held in the Investec Property Fund (IPF) and other equity
investments.
Group Investments Southern Africa UK & Other Total
FY2022 FY2021 Variance FY2022 FY2021 Variance FY2022 FY2021
£'m £'m £'m % % in Rands £'m £'m £'m % £'m £'m
Operating income (net of ECL charges) 60.5 12.0 48.5 >100% >100% 33.4 25.1 8.2 32.8% 93.9 37.2
Operating costs (1.9) (2.1) 0.2 (7.2%) (8.5%) - - - - (1.9) (2.1)
(Profit) attributable to NCI (39.9) (0.7) (39.2) (>100%) (>100%) - - - - (39.9) (0.7)
Adjusted operating profit 18.7 9.2 9.4 >100% 92.7% 33.4 25.1 8.2 32.8% 52.1 34.4
Totals and variance determined in £'000 which may result in rounding
differences.
*Post the 30 May 2022 distribution, the Group's holding in Ninety One will be
c.10%..
Adjusted operating profit from Group Investments increased by 51.4% to £52.1
million (FY2021: £34.4 million) driven by:
• Better than expected performance in the underlying investee companies
within IEP,
• Growth in earnings from Ninety One, and
• Lower negative FX adjustments on Euro-denominated investments in IPF,
compared to the prior year.
Further information
Additional information on each of the business units is provided in the Group
year-end results analyst book published on the Group's website:
http://www.investec.com.
On behalf of the boards of Investec plc and Investec Limited
Philip Hourquebie Fani Titi
Chair Group Chief Executive
18 May 2022
Notes to the commentary section above
Presentation of financial information
Investec operates under a Dual Listed Companies (DLC) structure with primary
listings of Investec plc on the London Stock Exchange and Investec Limited on
the JSE Limited.
In terms of the contracts constituting the DLC structure, Investec plc and
Investec Limited effectively form a single economic enterprise in which the
economic and voting rights of ordinary shareholders of the companies are
maintained in equilibrium relative to each other. The directors of the two
companies consider that for financial reporting purposes, the fairest
presentation is achieved by combining the results and financial position of
both companies.
Accordingly, these year-end results reflect the results and financial position
of the combined DLC Group under UK adopted International Financial Reporting
Standards (IFRS) which comply with IFRS as issued by the International
Accounting Standards Board (IASB), denominated in Pounds Sterling. In the
commentary above, all references to Investec or the Group relate to the
combined DLC Group comprising Investec plc and Investec Limited.
Following a review of the liquidity, capital position, profitability, the
business model and operational risks facing the business, the directors have a
reasonable expectation that the Investec Group will be a going concern for a
period of at least 12 months. The results for the year ended 31 March 2022 has
accordingly been prepared on the going concern basis.
Unless the context indicates otherwise, all comparatives included in the
commentary above relate to the year ended 31 March 2021.
Amounts represented on a neutral currency basis for income statement items
assume that the relevant average exchange rates for the year ended 31 March
2022 remain the same as those in the prior year. Amounts represented on a
neutral currency basis for balance sheet items assume that the relevant
closing exchange rates at 31 March 2022 remain the same as those at 31 March
2021.
Neutral currency information is considered as pro-forma financial information
as per the JSE Listings Requirements and is therefore the responsibility of
the Group's Board of Directors. Pro-forma financial information was prepared
for illustrative purposes and because of its nature may not fairly present the
issuer's financial position, changes in equity, or results of operations. The
external auditors of Investec Limited performed a review of the pro forma
financial information and the opinion is available for inspection at the
registered office of Investec upon request.
Foreign currency impact
The Group's reporting currency is Pounds Sterling. Certain of the Group's
operations are conducted by entities outside the UK. The results of operations
and the financial condition of these individual companies are reported in the
local currencies in which they are domiciled, including Rands, Australian
Dollars, Euros and US Dollars. These results are then translated into Pounds
Sterling at the applicable foreign currency exchange rates for inclusion in
the Group's combined consolidated financial statements. In the case of the
income statement, the weighted average rate for the relevant period is applied
and, in the case of the balance sheet, the relevant closing rate is used.
The following table sets out the movements in certain relevant exchange rates
against Pounds Sterling over the period:
Year ended Year ended
31 March 2022 31
Ma
rc
h
20
21
Currency Closing Average Closing Average
per GBP1.00
South African Rand 19.24 20.28 20.36 21.33
Euro 1.18 1.18 1.17 1.12
US Dollar 1.31 1.37 1.38 1.31
Profit Forecast
The following matters highlighted in this announcement contain forward-looking
statements:
• The cost to income ratio to be within the Group target of <63%
notwithstanding inflationary pressures.
• Normalisation of expected credit loss impairment charges and
consequent credit loss ratio increase towards the Group's revised
through-the-cycle (TTC) range of 25-35bps, with South Africa's TTC range
calibrated between 20bps and 30bps, and the UK between 30bps and 40bps.
• Improvement in ROE towards the 12-16% Group target range, which we
expect to achieve by FY2024. This will be aided by capital management
initiatives.
The basis of preparation of this statement and the assumptions upon which it
was based are set out below. This statement is subject to various risks and
uncertainties and other factors - these factors may cause the Group's actual
future results, performance or achievements in the markets in which it
operates to differ from those expressed in this Profit Forecast.
Any forward-looking statements made are based on the knowledge of the Group at
18 May 2022.
This forward-looking statement represents a profit forecast under the Listing
Rules. The Profit Forecast relates to the year ending 31 March 2023.
The financial information on which the Profit Forecast was based is the
responsibility of the Directors of the Group and has not been reviewed and
reported on by the Group's auditors.
Basis of preparation
The Profit Forecast has been properly compiled using the assumptions stated
below, and on a basis consistent with the accounting policies adopted in the
Group's 31 March 2022 unaudited preliminary financial statements, which are in
accordance with IFRS.
Assumptions
The Profit Forecast has been prepared on the basis of the following
assumptions during the forecast period:
Factors outside the influence or control of the Investec Board:
• There will be no material change in the political and/or economic
environment that would materially affect the Investec Group.
• There will be no material change in legislation or regulation
impacting on the Investec Group's operations or its accounting policies.
• There will be no business disruption that will have a significant
impact on the Investec Group's operations, whether for the economic effects of
increased geopolitical tensions or otherwise.
• The Rand/Pound Sterling and US Dollar/Pound Sterling exchange rates
and the tax rates remain materially unchanged from the prevailing rates
detailed above.
• There will be no material changes in the structure of the markets,
client demand or the competitive environment.
• There will be no material change to the facts and circumstances
relating to legal proceedings and uncertain tax matters.
Estimates and judgements
In preparation of the Profit Forecast, the Group makes estimations and applies
judgement that could affect the reported amount of assets and liabilities
within the reporting period. Key areas in which judgement is applied include:
• Valuation of unlisted investments primarily in the private equity,
direct investments portfolios and embedded derivatives. Key valuation inputs
are based on the most relevant observable market inputs, adjusted where
necessary for factors that specifically apply to the individual investments
and recognising market volatility.
• The determination of ECL against assets that are carried at amortised
cost and ECL relating to debt instruments at fair value through other
comprehensive income (FVOCI) involves the assessment of future cash flows
which is judgmental in nature.
• Valuation of investment properties is performed by capitalising the
budget net income of the property at the market related yield applicable at
the time.
• The Group's income tax charge and balance sheet provision are
judgmental in nature. This arises from certain transactions for which the
ultimate tax treatment can only be determined by final resolution with the
relevant local tax authorities. The Group recognises in its tax provision
certain amounts in respect of taxation that involve a degree of estimation and
uncertainty where the tax treatment cannot finally be determined until a
resolution has been reached by the relevant tax authority. The carrying amount
of this provision is often dependent on the timetable and progress of
discussions and negotiations with the relevant tax authorities, arbitration
processes and legal proceedings in the relevant tax jurisdictions in which the
Group operates. Issues can take many years to resolve and assumptions on the
likely outcome would therefore have to be made by the Group.
• Where appropriate, the Group has utilised expert external advice as
well as experience of similar situations elsewhere in making any such
provisions. Determination of interest income and interest expense using the
effective interest rate method involves judgement in determining the timing
and extent of future cash flows.
Accounting policies, significant judgements and disclosures
These unaudited condensed combined consolidated financial results have been
prepared in terms of the recognition and measurement criteria of the
presentation and disclosure requirements of IAS 34, "Interim Financial
Reporting" and IFRS as adopted by the UK which comply with IFRS' as issued by
the IASB. At 31 March 2022, UK adopted IFRS are identical in all material
respects to current IFRS applicable to the Group, with differences only in the
effective dates of certain standards.
The accounting policies applied in the preparation of the results for the year
ended 31 March 2022 are consistent with those adopted in the financial
statements for year ended 31 March 2021.
The financial results have been prepared under the supervision of Nishlan
Samujh, the Group Finance Director. The annual financial statements for the
year ended 31 March 2022 are available on the Group's website:
www.investec.com
Proviso
• Please note that matters discussed in this announcement may contain
forward-looking statements which are subject to various risks and
uncertainties and other factors, including, but not limited to:
- changes in the political and/or economic environment that would
materially affect the Investec Group
- changes in the economic environment caused by the resulting lockdowns
and government programmes aimed to stimulate the economy
- changes in legislation or regulation impacting the Investec Group's
operations or its accounting policies
- changes in business conditions that will have a significant impact on
the Investec Group's operations
- changes in exchange rates and/or tax rates from the prevailing rates
outlined in this announcement
- changes in the structure of the markets, client demand or the
competitive environment.
• A number of these factors are beyond the Group's control.
• These factors may cause the Group's actual future results, performance
or achievements in the markets in which it operates to differ from those
expressed or implied.
• Any forward-looking statements made are based on the knowledge of the
Group at 18 May 2022.
• The information in the Group's announcement for the year ended 31
March 2022, which was approved by the Board of Directors on 18 May 2022, does
not constitute statutory accounts as defined in Section 435 of the UK
Companies Act 2006. The 31 March 2021 financial statements were filed with the
registrar and were unqualified with the audit report containing no statements
in respect of sections 498(2) or 498(3) of the UK Companies Act.
• The financial information on which forward-looking statements are
based is the responsibility of the Directors of the Group and has not been
reviewed and reported on by the Group's auditors.
This announcement is available on the Group's website:
www.investec.com
Definitions
• Adjusted operating profit refers to operating profit before goodwill,
acquired intangibles and strategic actions and after adjusting for earnings
attributable to other non-controlling interests. Non-IFRS measures such as
adjusted operating profit are considered as pro forma financial information as
per the JSE Listing Requirements. The pro forma financial information is the
responsibility of the Group's Board of Directors. Pro-forma financial
information was prepared for illustrative purposes and because of its nature
may not fairly present the issuer's financial position, changes in equity or
results of operations. The external auditors of Investec Limited performed a
review of the pro forma financial information and the opinion is available for
inspection at the registered office of Investec upon request.
• Adjusted earnings is calculated by adjusting basic earnings
attributable to shareholders for the amortisation of acquired intangible
assets, non-operating items including strategic actions, and earnings
attributable to perpetual preference shareholders and other additional tier 1
security holders.
• Adjusted basic earnings per share is calculated as adjusted earnings
attributable to shareholders divided by the weighted average number of
ordinary shares in issue during the year.
• Headline earnings is adjusted earnings plus the after tax financial
effect of strategic actions and the amortisation of acquired intangible
assets. Headline earnings is an earnings measure required to be calculated and
disclosed by the JSE and is calculated in accordance with the guidance
provided in Circular 1/2021.
• Headline earnings per share (HEPS) is calculated as headline earnings
divided by the weighted average number of ordinary shares in issue during the
year.
• Basic earnings is earnings attributable to ordinary shareholders as
defined by IAS33 Earnings Per Share.
• Dividend payout ratio is calculated as the dividend per share divided
by adjusted earnings per share.
• Pre-provision adjusted operating profit is calculated as: Total
operating income before expected credit loss impairment charges, net of
operating costs and net of operating profits or losses attributable to other
non-controlling interests.
• The credit loss ratio is calculated as expected credit loss (ECL)
impairment charges on gross core loans as a percentage of average gross core
loans subject to ECL.
• The cost to income ratio is calculated as: operating costs divided by
operating income before expected credit loss impairment charges (net of
operating profits or losses attributable to other non-controlling interests).
• Return on average ordinary shareholders' equity (ROE) is calculated as
adjusted earnings attributable to ordinary shareholders divided by average
ordinary shareholders' equity.
• Return on average tangible ordinary shareholders' equity (ROTE) is
calculated as adjusted earnings attributable to ordinary shareholders divided
by average tangible ordinary shareholders' equity.
• Core loans is defined as net loans to customers plus net own
originated securitised assets.
• NCI is non-controlling interests.
Financial assistance
Shareholders are referred to Special Resolution number 30, which was approved
at the annual general meeting held on 5 August 2021, relating to the provision
of direct or indirect financial assistance in terms of Section 45 of the South
African Companies Act, No 71 of 2008 to related or inter-related companies.
Shareholders are hereby notified that in terms of S45(5)(a) of the South
African Companies Act, the Boards of Directors of Investec Limited and
Investec Bank Limited provided such financial assistance during the period 1
April 2021 to 31 March 2022 to various Group subsidiaries.
Johannesburg and London
Sponsor: Investec Bank Limited
Exchange rates between local currencies and Pounds Sterling have fluctuated
over the period. The most significant impact arises from the volatility of the
Rand. The average Rand: Pound Sterling exchange rate over the period has
appreciated by 4.9% against the comparative 12-month period ended 31 March
2021, and the closing rate has appreciated by 5.5% since 31 March 2021. The
following tables provide an analysis of the impact of the Rand on our reported
numbers.
Results in Pounds Sterling Results in Rands
Year to 31 March 2022 Year to 31 March 2021 % Neutral currency^ Year to 31 March 2022 Neutral Year to 31 March 2022 Year to 31 March 2021 %
change currency change
%
change
Adjusted operating profit before taxation (million) £687 £378 82.1% £669 77.0% R13 947 R8 202 70.0%
Earnings attributable to shareholders (million) £516 £268 92.5% £503 87.7% R10 481 R5 715 83.4%
Adjusted earnings attributable to shareholders (million) £505 £268 88.3% £493 84.0% R10 256 R5 710 79.6%
Adjusted earnings per share 55.1p 28.9p 90.7% 53.7p 85.8% 1118c 614c 82.1%
Basic earnings per share 52.0p 25.2p 106.3% 50.7p 101.2% 1055c 538c 96.1%
Headline earnings per share 53.3p 26.6p 100.4% 51.9p 95.1% 1083c 568c 90.7%
Results in Pounds Sterling Results in Rands
At 31 March 2022 At 31 March 2021 % Neutral currency^^ At 31 March 2022 Neutral At 31 March 2022 At 31 March 2021 %
change currency change
%
change
Net asset value per share 510.0p 458.0p 11.4% 495.9p 8.3% 9 810c 9 326c 5.2%
Tangible net asset value per share 476.6p 423.6p 12.5% 462.4p 9.2% 9 167c 8 625c 6.3%
Total equity (million) £5 740 £5 312 8.1% £5 565 4.8% R110 410 R108 161 2.1%
Total assets (million) £58 844 £51 450 14.4% £57 127 11.0% R1 131 872 R1 047 605 8.0%
Core loans (million) £29 934 £26 438 13.2% £29 081 10.0% R575 773 R538 320 7.0%
Cash and near cash balances (million) £17 161 £13 229 29.7% £16 702 26.3% R330 089 R269 364 22.5%
Customer accounts (deposits) (million) £40 118 £34 449 16.5% £38 911 12.9% R771 675 R701 446 10.0%
Funds under management (million) £63 800 £58 436 9.2% £62 743 7.4% R1 227 209 R1 189 872 3.1%
^ For income statement items we have used the average Rand: Pound
Sterling exchange rate that was applied in the prior period, i.e. 21.33.
^^ For balance sheet items we have assumed that the Rand: Pound
Sterling closing exchange rate has remained neutral since 31 March 2021.
Condensed combined consolidated income statement
£'000 Year to Year to
31 March 2022
31 March 2021
Interest income 1 951 209 1 922 299
Interest expense (1 005 939) (1 144 193)
Net interest income 945 270 778 106
Fee and commission income 864 639 791 153
Fee and commission expense (46 423) (42 275)
Investment income 27 974 32 002
Share of post-taxation profit of associates and joint venture holdings 79 556 42 459
Trading income/(loss) arising from
- customer flow 128 277 35 566
- balance sheet management and other trading activities (21 128) (18 903)
Other operating income 12 190 22 953
Total operating income before expected credit loss impairment charges 1 990 355 1 641 061
Expected credit loss impairment charges (28 828) (99 438)
Operating income 1 961 527 1 541 623
Operating costs (1 233 948) (1 164 513)
Operating profit before goodwill, acquired intangibles and strategic actions 727 579 377 110
Impairment of goodwill (1 962) (11 599)
Impairment of associates and joint venture holdings - (16 773)
Amortisation of acquired intangibles (15 477) (15 287)
Amortisation of acquired intangibles of associates (9 249) (9 268)
Closure and rundown of the Hong Kong direct investments business (1 203) 7 386
Operating profit 699 688 331 569
Implementation costs on distribution of associate to shareholders (2 427) -
Profit before taxation 697 261 331 569
Taxation on operating profit before goodwill, acquired intangibles and (143 309) (74 539)
strategic actions
Taxation on acquired intangibles and strategic actions 2 422 1 712
Profit after taxation 556 374 258 742
(Profit)/loss attributable to non-controlling interests (40 170) 472
Loss attributable to non-controlling interests relating to impairments of - 9 126
associates
Earnings attributable to shareholders 516 204 268 340
Earnings attributable to ordinary shareholders 475 469 231 153
Earnings attributable to perpetual preferred securities and other Additional 40 735 37 187
Tier 1 security holders
Earnings per share
Year to Year to
31 March 2022
31 March 2021
Earnings per share - pence 52.0 25.2
Diluted earnings per share - pence 50.2 24.9
Combined consolidated statement of total comprehensive income
£'000 Year to Year to
31 March 2022
31 March 2021
Profit after taxation 556 374 258 742
Other comprehensive income:
Items that may be reclassified to the income statement
Fair value movements on cash flow hedges taken directly to other comprehensive (4 311) 242
income^
Fair value movements on debt instruments at FVOCI taken directly to other (301) 152 355
comprehensive income^
Gain on realisation of debt instruments at FVOCI recycled through the income (2 010) (717)
statement^
Foreign currency adjustments on translating foreign operations 173 160 111 779
Items that will not be reclassified to the income statement
Effect of rate change on deferred taxation relating to adjustment for IFRS 9 617 380
Fair value movements on equity instruments at FVOCI taken directly to other 3 420 1 778
comprehensive income^
Remeasurement of net defined benefit pension liability 40 (39)
Net gain/(loss) attributable to own credit risk^ 11 095 (850)
Total comprehensive income 738 084 523 670
Total comprehensive income attributable to ordinary shareholders 629 300 448 637
Total comprehensive income attributable to non-controlling interests 68 049 37 846
Total comprehensive income attributable to perpetual preferred securities 40 735 37 187
Total comprehensive income 738 084 523 670
^ Net of taxation expense of £3.5 million (2021: £38.5 million).
Combined consolidated balance sheet
At 31 March 2022 31 March 2021^
£'000
Assets
Cash and balances at central banks 5 998 270 3 517 100
Loans and advances to banks 2 552 061 2 637 436
Non-sovereign and non-bank cash placements 684 983 439 841
Reverse repurchase agreements and cash collateral on securities borrowed 4 609 778 3 575 713
Sovereign debt securities 4 148 867 3 711 623
Bank debt securities 1 515 210 1 121 730
Other debt securities 1 229 287 1 364 235
Derivative financial instruments 1 617 240 1 714 743
Securities arising from trading activities 683 329 1 024 671
Investment portfolio 912 872 909 050
Loans and advances to customers 29 561 088 26 041 087
Own originated loans and advances to customers securitised 375 763 401 912
Other loans and advances 128 284 102 135
Other securitised assets 123 888 140 087
Interests in associated undertakings and joint venture holdings 734 434 679 157
Current taxation assets 33 653 60 325
Deferred taxation assets 259 370 246 622
Other assets 2 068 615 2 165 438
Property and equipment 335 420 329 972
Investment properties 820 555 832 061
Goodwill 258 404 259 805
Software 9 443 12 574
Other acquired intangible assets 44 152 58 968
Non-current assets classified as held for sale 79 229 51 783
58 784 195 51 398 068
Other financial instruments at fair value through profit or loss in respect of 59 549 52 405
liabilities to customers
58 843 744 51 450 473
Liabilities
Deposits by banks 3 178 668 2 403 712
Derivative financial instruments 2 537 303 2 190 487
Other trading liabilities 275 589 326 189
Repurchase agreements and cash collateral on securities lent 863 285 1 003 312
Customer accounts (deposits) 40 118 412 34 449 430
Debt securities in issue 2 043 640 1 892 319
Liabilities arising on securitisation of own originated loans and advances 238 370 160 646
Liabilities arising on securitisation of other assets 95 885 108 281
Current taxation liabilities 41 631 78 790
Deferred taxation liabilities 19 624 40 333
Other liabilities 2 315 841 1 951 122
51 728 248 44 604 621
Liabilities to customers under investment contracts 56 475 49 798
Insurance liabilities, including unit-linked liabilities 3 074 2 607
51 787 797 44 657 026
Subordinated liabilities 1 316 191 1 480 951
53 103 988 46 137 977
Equity
Ordinary share capital 247 247
Ordinary share premium 1 516 024 1 517 852
Treasury shares (318 987) (267 508)
Other reserves (650 228) (788 222)
Retained income 4 069 776 3 772 628
Ordinary shareholders' equity 4 616 832 4 234 997
Perpetual preference share capital and premium 174 869 174 053
Shareholders' equity excluding non-controlling interests 4 791 701 4 409 050
Other Additional Tier 1 securities in issue 411 683 335 111
Non-controlling interests 536 372 568 335
- Perpetual preferred securities issued by subsidiaries - 72 750
- Non-controlling interests in partially held subsidiaries 536 372 495 585
Total equity 5 739 756 5 312 496
Total liabilities and equity 58 843 744 51 450 473
^ Restated as detailed below.
Condensed consolidated statement of changes in equity
£'000 Year to Year to
31 March 2022
31 March 2021
Balance at the beginning of the year 5 312 496 4 897 632
Total comprehensive income 738 084 523 670
Share-based payments adjustments 23 932 19 121
Dividends paid to ordinary shareholders (178 418) (53 346)
Dividends paid to perpetual preference shareholders included in (40 735) (37 187)
non-controlling interests and Other Additional Tier 1 security holders
Dividends paid to non-controlling interests (29 287) (32 385)
Share buyback of ordinary share capital (36 150) -
Repurchase of perpetual preference shares (77 835) (6 274)
Issue of Other Additional Tier 1 security instruments 67 552 35 508
Net equity impact of non-controlling interest movements 443 (6 128)
Movement of treasury shares (47 114) (10 161)
Net equity movements of interests in associated undertakings 6 788 (17 954)
Balance at the end of the year 5 739 756 5 312 496
Condensed consolidated cash flow statement
£'000 Year to Year to
31 March 2022
31 March 2021^
Net cash inflow/(outflow) from operating activities 3 071 540 (606 625)
Net cash inflow from investing activities 35 565 1 414
Net cash outflow from financing activities (587 923) (134 626)
Effects of exchange rates on cash and cash equivalents 90 928 146 030
Net increase/(decrease) in cash and cash equivalents 2 610 110 (593 807)
Cash and cash equivalents at the beginning of the year 6 489 630 7 083 437
Cash and cash equivalents at the end of the year 9 099 740 6 489 630
^ Restated as detailed below.
Cash and cash equivalents is defined as including: cash and balances at
central banks, on demand loans and advances to banks and non-sovereign and
non-bank cash placements (all of which have a maturity profile of less than
three months).
Combined consolidated segmental analysis
Segmental geographical and business analysis of adjusted operating profit
before goodwill, acquired intangibles, non-operating items, taxation and after
non-controlling interests.
Private Client
Specialist Banking
For the year to 31 March 2022 Wealth & Investment Private Banking Corporate, Investment Banking and Other Group Investments Group Costs Total Group % change % of total
£'000
UK and Other 87 681 30 828 162 825 33 387 (14 819) 299 902 138.0% 43.6%
Southern Africa 35 454 198 827 150 549 18 670 (15 993) 387 507 54.0% 56.4%
Adjusted operating profit 123 135 229 655 313 374 52 057 (30 812) 687 409 82.1% 100.0%
Non-controlling interest* 40 170
Adjusted operating profit before non-controlling interests 727 579
% change 22.6% 90.7% 101.1% 51.4% (8.1%) 82.1%
% of total 17.9% 33.4% 45.6% 7.6% (4.5)% 100.0%
Total assets £'mn 1 267 16 157 39 518 1 902 - 58 844
Private Client
Specialist Banking
For the year to 31 March 2021 Wealth & Investment Private Banking Corporate, Investment Banking and Other Group Investments Group Costs Total Group % of total
£'000
UK and Other 74 340 (3 012) 47 799 25 142 (18 286) 125 983 33.4%
Southern Africa 26 119 123 434 108 049 9 243 (15 246) 251 599 66.6%
Adjusted operating profit 100 459 120 422 155 848 34 385 (33 532) 377 582 100.0%
Non-controlling interest* (472)
Adjusted operating profit before non-controlling interests 377 110
% of total 26.6% 31.9% 41.3% 9.1% (8.9)% 100.0%
Total assets^ £'mn 1 271 13 673 34 645 1 861 - 51 450
* Profit/(loss) attributable to non-controlling interests
predominantly relates to the Investec Property Fund Limited.
^ Restated as detailed below.
Net fee and commission income
For the year to 31 March 2022 UK and Southern Total
£'000 Other Africa
Wealth & Investment net fee and commission income 344 029 101 286 445 315
Fund management fees/fees for funds under management 301 950 55 697 357 647
Private client transactional fees 42 735 47 351 90 086
Fee and commission expense (656) (1 762) (2 418)
Specialist Banking net fee and commission income 151 286 171 555 322 841
Specialist Banking fee and commission income* 165 543 197 544 363 087
Specialist Banking fee and commission expense (14 257) (25 989) (40 246)
Group Investments net fee and commission income - 50 060 50 060
Group Investments fee and commission income - 53 819 53 819
Group Investments fee and commission expense - (3 759) (3 759)
Net fee and commission income 495 315 322 901 818 216
Annuity fees (net of fees payable) 318 389 253 049 571 438
Deal fees 176 926 69 852 246 778
** Included in Specialist Banking is fee and commission income of
£72.1 million (2021: £63.7 million) for operating lease income which is out
of the scope of IFRS 15 - Revenue from contracts with customers.
Balance sheet restatements
Loans and advances to banks and other liabilities
As at 31 March 2021, there was a gross up on balance sheet in loans and
advances to banks and other liabilities as a result of client funds being
recorded on balance sheet. The prior year balance sheet has been restated to
correct the gross up previously reported. This change has no impact on the
income statement.
The impact of this change on the 31 March 2021 and 31 March 2020 balance sheet
is:
At 31 March 2021 Restatement At 31 March 2021
as previously reported restated
£'000
Assets
Loans and advances to banks 2 699 317 (61 881) 2 637 436
Total assets 51 512 354 (61 881) 51 450 473
Liabilities
Other liabilities 2 013 003 (61 881) 1 951 122
Total liabilities 46 199 858 (61 881) 46 137 977
At 31 March 2020 Restatement At 31 March 2020
as previously reported restated
£'000
Assets
Loans and advances to banks 2 666 851 (13 093) 2 653 758
Total assets 50 557 732 (13 093) 50 544 639
Liabilities
Other liabilities 2 211 487 (13 093) 2 198 394
Total liabilities 45 660 100 (13 093) 45 647 007
The impact of this change on the 31 March 2021 cash flow statement is:
Year to Restatement Year to 31 March 2021
31 March 2021 restated
as previously reported
£'000
Net cash outflow from operating activities (557 837) (48 788) (606 625)
Cash and cash equivalents at the beginning of the year 7 096 530 (13 093) 7 083 437
Cash and cash equivalents at the end of the year 6 551 511 (61 881) 6 489 630
Contingent liabilities
Investec Bank plc ("Investec") has been notified by the Office of the Public
Prosecutor in Cologne, Germany, that it and certain of its current and former
employees may be involved in possible charges relating to historical
involvement in German dividend tax arbitrage transactions (known as cum-ex
transactions). Investigations are ongoing and no formal proceeding have been
issued against Investec by the Office of the Public Prosecutor. Whilst no
formal proceedings have been issued against Investec by the Office of the
Public Prosecutor, a provision was previously raised to reflect the
potential financial outflows that could arise as a result of this matter. In
addition, subsequent to the year end date, Investec received certain enquiries
in respect of client tax reclaims for the periods 2010-2011 relating to the
historical German dividend arbitrage transactions from the German Federal Tax
Office (FTO) in Bonn. The FTO has provided limited information and Investec
has sought further information and clarification. Given the lack of
information, it is not possible for Investec to reliably estimate the
potential liability, if any, in relation to this matter.
Investec is cooperating with the German authorities and continues to conduct
its own internal investigation into the matters in question. There are factual
issues to be resolved which may have legal consequences including financial
penalties. In relation to potential civil claims; whilst Investec is not a
claimant nor a defendant to any civil claims in respect of cum ex
transactions, Investec has received third party notices in relation to two
civil proceedings in Germany and may elect to join the proceedings as a third
party participant. Investec has itself served third party notices on various
participants to these historic transactions in order to preserve statute of
limitation on any potential future claims that Investec may seek to bring
against those parties, should Investec incur any liability in the future.
Investec has also entered into standstill agreements with some third parties
in order to suspend the limitation period in respect of the potential civil
claims. While Investec is not a claimant nor a defendant to any civil claims
at this stage, it cannot rule out the possibility of civil claims by or
against Investec in future in relation to the relevant transactions. The Group
has not provided further disclosure with respect to these historical dividend
arbitrage transactions because it has concluded that such disclosure may be
expected to seriously prejudice its outcome.
Events after the reporting date
On 18 March 2022, a circular was published noting the proposed distribution of
15% of the issued Ninety One DLC shares to Investec ordinary shareholders
reducing the Investec holding from 25% to 10%.
As at 31 March 2022, a Section 46 ruling was still to be obtained from the
South African Revenue Service stipulating the tax consequences of the
distribution in South Africa, as well as the outcome of the shareholder vote
that was scheduled to take place on 28 April 2022.
The Section 46 ruling was obtained on 20 April 2022 and a SENS and RNS
announcement was published to shareholders to inform them of the outcome of
the ruling as it was considered information that could have an impact on the
vote of an ordinary shareholder.
On 28 April 2022, the General meeting was concluded with a vote in favour of
the distribution. The distribution is expected to be effective on 30 May 2022.
The distribution was classified as a non-adjusting event after the reporting
date as defined by IAS 10 Events after the Reporting Period.
Analysis of assets and liabilities by measurement category
At 31 March 2022 Total Amortised Non-financial Total
instruments at cost instruments or
fair value scoped out of
IFRS 9
£'000
Assets
Cash and balances at central banks - 5 998 270 - 5 998 270
Loans and advances to banks - 2 552 061 - 2 552 061
Non-sovereign and non-bank cash placements 29 321 655 662 - 684 983
Reverse repurchase agreements and cash collateral on securities borrowed 1 882 847 2 726 931 - 4 609 778
Sovereign debt securities 3 371 704 777 163 - 4 148 867
Bank debt securities 907 809 607 401 - 1 515 210
Other debt securities 720 269 509 018 - 1 229 287
Derivative financial instruments 1 617 240 - - 1 617 240
Securities arising from trading activities 683 329 - - 683 329
Investment portfolio 912 872 - - 912 872
Loans and advances to customers 2 374 500 27 186 588 - 29 561 088
Own originated loans and advances to customers securitised - 375 763 - 375 763
Other loans and advances - 128 284 - 128 284
Other securitised assets 93 087 30 801 - 123 888
Interests in associated undertakings and joint venture holdings - - 734 434 734 434
Current taxation assets - - 33 653 33 653
Deferred taxation assets - - 259 370 259 370
Other assets 277 889 1 349 259 441 467 2 068 615
Property and equipment - - 335 420 335 420
Investment properties - - 820 555 820 555
Goodwill - - 258 404 258 404
Software - - 9 443 9 443
Other acquired intangible assets - - 44 152 44 152
Non-current assets classified as held for sale 25 880 - 53 349 79 229
12 896 747 42 897 201 2 990 247 58 784 195
Other financial instruments at fair value through profit or loss in respect of 59 549 - - 59 549
liabilities to customers
12 956 296 42 897 201 2 990 247 58 843 744
Liabilities
Deposits by banks - 3 178 668 - 3 178 668
Derivative financial instruments 2 537 303 - - 2 537 303
Other trading liabilities 275 589 - - 275 589
Repurchase agreements and cash collateral on securities lent 163 877 699 408 - 863 285
Customer accounts (deposits) 2 945 831 37 172 581 - 40 118 412
Debt securities in issue 46 192 1 997 448 - 2 043 640
Liabilities arising on securitisation of own originated loans - 238 370 - 238 370
and advances
Liabilities arising on securitisation of other assets 95 885 - - 95 885
Current taxation liabilities - - 41 631 41 631
Deferred taxation liabilities - - 19 624 19 624
Other liabilities 106 987 1 330 695 878 159 2 315 841
6 171 664 44 617 170 939 414 51 728 248
Liabilities to customers under investment contracts 56 475 - - 56 475
Insurance liabilities, including unit-linked liabilities 3 074 - - 3 074
6 231 213 44 617 170 939 414 51 787 797
Subordinated liabilities - 1 316 191 - 1 316 191
6 231 213 45 933 361 939 414 53 103 988
Financial instruments at fair value
The table below analyses recurring fair value measurements for financial
assets and financial liabilities. These fair value measurements are
categorised into different levels in the fair value hierarchy based on the
inputs to the valuation technique used.
The different levels are identified as follows:
Level 1 - quoted (unadjusted) prices in active markets for identical assets or
liabilities.
Level 2 - inputs other than quoted prices included within level 1 that are
observable for the asset or liability, either directly
(i.e. as prices) or
indirectly (i.e. derived from prices).
Level 3 - inputs for the asset or liability that are not based on observable
market data (unobservable inputs).
Fair value category
At 31 March 2022 Total instruments at fair value Level 1 Level 2 Level 3
£'000
Assets
Non-sovereign and non-bank cash placements 29 321 - 29 321 -
Reverse repurchase agreements and cash collateral on securities borrowed 1 882 847 - 1 882 847 -
Sovereign debt securities 3 371 704 3 371 704 - -
Bank debt securities 907 809 330 177 577 632 -
Other debt securities 720 269 46 310 568 928 105 031
Derivative financial instruments 1 617 240 19 1 573 271 43 950
Securities arising from trading activities 683 329 664 422 14 127 4 780
Investment portfolio 912 872 30 901 8 263 873 708
Loans and advances to customers 2 374 500 - 1 122 268 1 252 232
Other securitised assets 93 087 - - 93 087
Other assets 277 889 277 889 - -
Non-current assets classified as held for sale 25 880 - - 25 880
Other financial instruments at fair value through profit or loss in respect of 59 549 59 549 - -
liabilities to customers
12 956 296 4 780 971 5 776 657 2 398 668
Liabilities
Derivative financial instruments 2 537 303 36 289 2 455 245 45 769
Other trading liabilities 275 589 111 273 164 316 -
Repurchase agreements and cash collateral on securities lent 163 877 - 163 877 -
Customer accounts (deposits) 2 945 831 - 2 945 831 -
Debt securities in issue 46 192 - 46 192 -
Liabilities arising on securitisation of other assets 95 885 - - 95 885
Other liabilities 106 987 - 57 569 49 418
Liabilities to customers under investment contracts 56 475 - 56 475 -
Insurance liabilities, including unit-linked liabilities 3 074 - 3 074 -
6 231 213 147 562 5 892 579 191 072
Net financial assets/(liabilities) at fair value 6 725 083 4 633 409 (115 922) 2 207 596
Transfers between level 1 and level 2
There were no transfers between level 1 and level 2 in the current year.
Measurement of financial assets and liabilities at level 2
The table below sets out information about the valuation techniques used at
the end of the reporting period in measuring financial instruments categorised
as level 2 in the fair value hierarchy:
Valuation basis/techniques Main inputs
Assets
Non-sovereign and non-bank cash placements Discounted cash flow model Yield curves
Reverse repurchase agreements and cash collateral on securities borrowed Discounted cash flow model, Hermite interpolation, Black-Scholes Yield curves, discount rates, volatilities
Bank debt securities Discounted cash flow model Yield curves
Other debt securities Discounted cash flow model Yield curves, NCD curves and swap curves, discount rates, external prices,
broker quotes
Derivative financial instruments Discounted cash flow model, Hermite interpolation, industry standard Discount rate, risk-free rate, volatilities, forex forward points and spot
derivative pricing models including Black-Scholes and Local Volatility rates, interest rate swap curves and credit curves
Securities arising from trading activities Standard industry derivative pricing model Discounted cash flow model Interest rate curves, implied bond spreads, equity volatilities, yield curves
Investment portfolio Discounted cash flow model, relative valuation model comparable quoted inputs Discount rate and fund unit price, net assets
Loans and advances to customers Discounted cash flow model Yield curves
Liabilities
Derivative financial instruments Discounted cash flow model, Hermite interpolation, industry standard Discount rate, risk-free rate, volatilities, forex forward points and spot
derivative pricing models including Black-Scholes and Local Volatility rates, interest rate swap curves and credit curves
Other trading liabilities Discounted cash flow model, Hermite interpolation, industry standard Discount rate, risk-free rate, volatilities, forex forward points and spot
derivative pricing models including Local Volatility rates, interest rate swap curves and credit curves
Repurchase agreements and cash collateral on securities lent Discounted cash flow model, Hermite interpolation Yield curves, discount rates
Customer accounts (deposits) Discounted cash flow model Yield curves, discount rates
Debt securities in issue Discounted cash flow model, Hermite interpolation, industry standard Discount rate, risk-free rate, volatilities, forex forward points and spot
derivative pricing models including Local Volatility rates, interest rate swap curves and credit curves
Other liabilities Discounted cash flow model Yield curves
Liabilities to customers under investment contracts Current price of underlying unitised assets Listed prices
Insurance liabilities, including unit-linked liabilities Current price of underlying unitised assets Listed prices
Level 3 financial instruments
The following tables show a reconciliation of the opening balances to the
closing balances for level 3 financial instruments. All instruments are at
fair value through profit or loss.
£'000 Investment Loans and Other securitised Other balance Total
portfolio advances to assets sheet assets
customers
Assets
Balance at 1 April 2021 862 528 1 047 390 107 259 176 250 2 193 427
Total gains/(losses) (1 434) 63 202 (657) 22 116 83 227
In the income statement (1 434) 63 768 (657) 22 116 83 793
In the statement of comprehensive income - (566) - - (566)
Purchases 65 547 1 845 044 - 59 165 1 969 756
Sales (69 620) (1 079 005) - (38 836) (1 187 461)
Issues 197 - - - 197
Settlements (20 544) (696 114) (13 515) (49 391) (779 564)
Transfers into level 3 621 37 262 - - 37 883
Foreign exchange adjustments 36 413 34 453 - 10 337 81 203
Balance at 31 March 2022 873 708 1 252 232 93 087 179 641 2 398 668
For the year to 31 March 2022, investment portfolio of £0.6 million was
transferred from level 2 to level 3. The valuation methodologies were reviewed
and unobservable inputs were used to determine the fair value. For the year
ended 31 March 2022, £37.3 million of loans and advances to customers has
been transferred from level 2 to level 3, due to inputs related to the
measurement of credit risk to the valuation model becoming unobservable.
£'000 Liabilities arising Other balance Total
on securitisation sheet liabilities
of other assets
Liabilities
Balance at 1 April 2021 108 281 73 592 181 873
Total (gains)/losses in the income statement (2 094) 18 461 16 367
Settlements (10 303) (1 451) (11 754)
Foreign exchange adjustments 1 4 585 4 586
Balance at 31 March 2022 95 885 95 187 191 072
The Group transfers between levels within the fair value hierarchy when the
significance of the unobservable inputs change or if the valuation methods
change.
The following table quantifies the gains or (losses) included in the income
statement and statement of other comprehensive income recognised on level 3
financial instruments:
For the year to 31 March 2022 Total Realised Unrealised
£'000
Total gains or (losses) included in the income statement for the year
Net interest income 66 069 58 038 8 031
Investment income* 4 901 47 671 (42 770)
Trading income arising from customer flow (2 194) (491) (1 703)
Trading income arising from balance sheet management and other trading (1 350) - (1 350)
activities
67 426 105 218 (37 792)
Total gains or (losses) included in other comprehensive income for the year
Gains on realisation on debt instruments at FVOCI recycled through the income 440 440 -
statement
Fair value movements on debt instruments at FVOCI taken directly to other (566) - (566)
comprehensive income
(126) 440 (566)
* Included within the investment income statement balance are
unrealised gains of £0.7 million presented within operational items in the
income statement.
Sensitivity of fair values to reasonably possible alternative assumptions by
level 3 instrument type
The fair value of financial instruments in level 3 are measured using
valuation techniques that incorporate assumptions that are not evidenced by
prices from observable market data. The below valuations have been considered
taking the ongoing global COVID-19 pandemic into consideration. The following
table shows the sensitivity of these fair values to reasonably possible
alternative assumptions, determined at a transactional level:
At 31 March 2022 Balance sheet Significant unobservable input changed Range which unobservable input has been changed Favourable Unfavourable
value changes changes
£'000 £'000 £'000
Assets
Other debt securities 105 031 Potential impact on income statement 3 199 (5 851)
Credit spreads 0.74%-2.75% 141 (286)
Cash flow adjustments CPR 8.4% 6 (8)
Other^ ^ 3 052 (5 557)
Derivative financial instruments 43 950 Potential impact on income statement 4 643 (5 266)
Volatilities 5%-18.9% 15 (29)
Underlying asset value^^ ^^ 4 026 (4 028)
Cash flow adjustment CPR 8.4% - (6)
Other^ ^ 602 (1 203)
Securities arising from trading activities 4 780 Potential impact on income statement
Cash flow adjustments CPR 11% 481 (635)
Investment portfolio 873 708 Potential impact on income statement 104 279 (137 434)
Price earnings multiple 5.5x-15x 9 505 (18 206)
Underlying asset value^^ ^^ 9 636 (20 897)
EBITDA ** 12 530 (9 459)
Discount rate 17.5 % 620 (623)
Cash flows ** 1 703 (1 370)
Underlying asset value^^ ^^ 1 614 (3 214)
Precious and industrial metal prices (5%)-5% 1 424 (1 424)
Property prices # 51 361 (51 361)
Other^ ^ 15 886 (30 880)
Loans and advances to customers 1 252 232 Potential impact on income statement 32 727 (52 588)
Credit spreads 0.15%-34.3% 10 656 (27 586)
Property value ** 7 776 (12 428)
Price earnings multiple 3.5x-4.2x 7 824 (1 136)
Underlying asset value^^ ^^ 3 641 (5 778)
Other^ ^ 2 830 (5 660)
Potential impact on other comprehensive income
Credit spreads 0.14%-6.17% 8 440 (15 725)
Other securitised assets* 93 087 Potential impact on income statement
Cash flow adjustments CPR 8.4% 988 (1 057)
Non-current assets classified as held for sale 25 880 Potential impact on income statement
Discount rate 13%-16% 567 (1 973)
Total level 3 assets 2 398 668 155 324 (220 529)
Liabilities
Derivative financial instruments 45 769 Potential impact on income statement (4 046) 4 060
Volatilities 5%-18.9% (21) 35
Underlying asset value^^ ^^ (4 025) 4 025
Liabilities arising on securitisation of other assets* 95 885 Potential impact on income statement
Cash flow adjustments CPR 4.4% (292) 299
Other liabilities 49 418 Potential impact on income statement
Property prices # (7 103) 7 103
Total level 3 liabilities 191 072 (11 441) 11 462
Net level 3 assets 2 207 596 143 883 (209 067)
* The sensitivity of the fair value of liabilities arising on
securitisation of other assets has been considered together with other
securitised assets.
^ Other - The valuation sensitivity has been assessed by adjusting
various inputs such as expected cash flows, discount rates, earnings multiples
rather than a single input. It is deemed appropriate to reflect the outcome on
a portfolio basis for the purposes of this analysis as the sensitivity of the
assets cannot be determined through the adjustment of a single input.
^^ Underlying asset values are calculated by reference to a tangible
asset, for example property, aircraft or shares.
∗∗ The EBITDA, cash flows and property values have been stressed
on an investment-by-investment and loan-by-loan basis in order to obtain
favourable and unfavourable valuations.
# Property values are the underlying input for the valuations
where the capitalisation rate when valuing these properties has been stressed
by 0.25bps.
In determining the value of level 3 financial instruments, the following are
the principal input that can require judgement:
Credit spreads
Credit spreads reflect the additional yield that a market participant would
demand for taking exposure to the credit risk of an instrument. The credit
spread for an instrument forms part of the yield used in a discounted cash
flow calculation. In general a significant increase in a credit spread in
isolation will result in a movement in fair value that is unfavourable for the
holder of a financial instrument.
Discount rates
Discount rates (including WACC) are used to adjust for the time value of money
when using a discounted cash flow valuation method. Where relevant, the
discount rate also accounts for illiquidity, market conditions and uncertainty
of future cash flows.
Volatilities
Volatility is a key input in the valuation of derivative products containing
optionality. Volatility is a measure of the variability or uncertainty in
returns for a given derivative underlying. It represents an estimate of how
much a particular underlying instrument, parameter or index will change in
value over time.
Cash flows
Cash flows relate to the future cash flows which can be expected from the
instrument and requires judgement.
EBITDA
The company's earnings before interest, taxes, depreciation and amortisation.
This is the main input into a price earnings multiple valuation method.
Price-earnings multiple
The price earnings ratio is an equity valuation multiple. It is a key driver
in the valuation of unlisted investments.
Property value and precious and industrial metals
The property value and precious and industrial metals is a key driver of
future cash flows on these investments.
Underlying asset value
In instances where cash flows have links to referenced assets, the underlying
asset value is used to determine the fair value. The underlying asset
valuation is derived using observable market prices sourced from broker
quotes, specialist valuers or other reliable pricing sources.
Fair value of financial assets and liabilities at amortised cost
At 31 March 2022 Carrying amount Fair value approximates carrying amount Balances where fair values do not approximate carrying amounts Fair value of balances that do not approximate carrying amounts
£'000
Assets
Cash and balances at central banks 5 998 270 5 998 270 - -
Loans and advances to banks 2 552 061 2 180 047 372 014 371 682
Non-sovereign and non-bank cash placements 655 662 655 662 - -
Reverse repurchase agreements and cash collateral on securities borrowed 2 726 931 1 240 798 1 486 133 1 485 172
Sovereign debt securities 777 163 - 777 163 789 650
Bank debt securities 607 401 31 105 576 296 575 241
Other debt securities 509 018 193 284 315 734 316 570
Loans and advances to customers 27 186 588 13 773 367 13 413 221 13 400 546
Own originated loans and advances to customers securitised 375 763 375 763 - -
Other loans and advances 128 284 67 032 61 252 61 253
Other securitised assets 30 801 30 801 - -
Other assets 1 349 259 1 349 259 - -
42 897 201 25 895 388 17 001 813 17 000 114
Liabilities
Deposits by banks 3 178 668 487 580 2 691 088 2 622 320
Repurchase agreements and cash collateral on securities lent 699 408 460 130 239 278 241 930
Customer accounts (deposits) 37 172 581 22 996 023 14 176 558 16 393 583
Debt securities in issue 1 997 448 342 119 1 655 329 1 654 527
Liabilities arising on securitisation of own originated loans and advances 238 370 238 370 - -
Other liabilities 1 330 695 1 327 371 3 324 2 419
Subordinated liabilities 1 316 191 245 670 1 070 521 1 132 335
45 933 361 26 097 263 19 836 098 22 047 114
Investec plc
Incorporated in England and Wales
Registration number: 3633621
LSE ordinary share code: INVP
JSE ordinary share code: INP
ISIN: GB00B17BBQ50
LEI: 2138007Z3U5GWDN3MY22
Ordinary share dividend announcement
In terms of the DLC structure, Investec plc shareholders registered on the
United Kingdom share register may receive all or part of their dividend
entitlements through dividends declared and paid by Investec plc on their
ordinary shares and/or through dividends declared and paid on the SA DAN share
issued by Investec Limited.
Investec plc shareholders registered on the South African branch register may
receive all or part of their dividend entitlements through dividends declared
and paid by Investec plc on their ordinary shares and/or through dividends
declared and paid on the SA DAS share issued by Investec Limited.
Declaration of dividend number 39
Notice is hereby given that a final dividend number 39, being a gross dividend
of 14.00000 pence (2021: 7.50000 pence) per ordinary share has been declared
by the Board from income reserves in respect of the year ended 31 March 2022,
payable to shareholders recorded in the shareholders' register of the Company
at the close of business on Friday 22 July 2022.
• For Investec plc shareholders, registered on the United Kingdom share
register, through a dividend payment by Investec plc from income reserves of
14.00000 pence per ordinary share
• For Investec plc shareholders, registered on the South African branch
register, through a dividend payment by
Investec Limited, on the SA DAS share, payable from income reserves,
equivalent to 14.00000 pence per ordinary share.
The relevant dates relating to the payment of dividend number 39 are as
follows:
Last day to trade cum-dividend
On the Johannesburg Stock Exchange (JSE) Tuesday 19 July 2022
On the London Stock Exchange (LSE) Wednesday 20 July 2022
Shares commence trading ex-dividend
On the Johannesburg Stock Exchange (JSE) Wednesday 20 July 2022
On the London Stock Exchange (LSE) Thursday 21 July 2022
Record date (on the JSE and LSE) Friday 22 July 2022
Payment date (on the JSE and LSE) Monday 8 August 2022
Share certificates on the South African branch register may not be
dematerialised or rematerialised between Wednesday 20 July 2022 and Friday
22 July 2022, both dates inclusive, nor may transfers between the United
Kingdom share register and the South African branch register take place
between Wednesday 20 July 2022 and Friday 22 July 2022, both dates
inclusive.
Additional information for South African resident shareholders of Investec plc
• Shareholders registered on the South African branch register are
advised that the distribution of 14.00000 pence, equivalent to a gross
dividend of 279.00000 cents per share, has been arrived at using the
Rand/Pound Sterling average buy/sell forward rate, as determined at 11h00 (SA
time) on Wednesday 18 May 2022
• Investec plc United Kingdom tax reference number: 2683967322360
• The issued ordinary share capital of Investec plc is 696 082 618
ordinary shares
• The dividend paid by Investec plc to South African resident
shareholders registered on the South African branch register and the dividend
paid by Investec Limited to Investec plc shareholders on the SA DAS share are
subject to South African Dividend Tax (Dividend Tax) of 20% (subject to any
available exemptions as legislated)
• Shareholders registered on the South African branch register who are
exempt from paying the Dividend Tax will receive a net dividend of 279.00000
cents per share paid by Investec Limited on the SA DAS share
• Shareholders registered on the South African branch register who are
not exempt from paying the Dividend Tax will receive a net dividend of
223.20000 cents per share (gross dividend of 279.00000 cents per share less
Dividend Tax of 55.80000 cents per share) per share paid by Investec Limited
on the SA DAS share.
By order of the Board
David Miller
Company Secretary
18 May 2022
Investec Limited
Incorporated in the Republic of South Africa
Registration number: 1925/002833/06
JSE share code: INL
NSX ordinary share code: IVD
BSE ordinary share code: INVESTEC
ISIN: ZAE000081949
LEI: 213800CU7SM6O4UWOZ70
Ordinary share dividend announcement
Declaration of dividend number 132
Notice is hereby given that final dividend number 132, being a gross dividend
of 279.00000 cents (2021: 150.00000 cents) per ordinary share has been
declared by the Board from income reserves in respect of the financial year
ended 31 March 2022 payable to shareholders recorded in the shareholders'
register of the Company at the close of business on Friday 22 July 2022.
The relevant dates relating to the payment of dividend number 132 are as
follows:
Last day to trade cum-dividend Tuesday 19 July 2022
Shares commence trading ex-dividend Wednesday 20 July 2022
Record date Friday 22 July 2022
Payment date Monday 8 August 2022
The final gross dividend of 279.00000 cents per ordinary share has been
determined by converting the Investec plc distribution of 14.00000 pence per
ordinary share into Rands using the Rand/Pound Sterling average buy/sell
forward rate at 11h00 (SA time) on Wednesday 18 May 2022.
Share certificates may not be dematerialised or rematerialised between
Wednesday 20 July 2022 and Friday 22 July 2022 both dates inclusive.
Additional information to take note of
• Investec Limited South African tax reference number: 9800/181/71/2
• The issued ordinary share capital of Investec Limited is 310 407 870
ordinary shares
• The dividend paid by Investec Limited is subject to South African
Dividend Tax (Dividend Tax) of 20% (subject to any available exemptions as
legislated)
• Shareholders who are exempt from paying the Dividend Tax will receive
a net dividend of 279.00000 cents per ordinary share
• Shareholders who are not exempt from paying the Dividend Tax will
receive a net dividend of 223.20000 cents per ordinary share (gross dividend
of 279.00000 cents per ordinary share less Dividend Tax of 55.80000 cents per
ordinary share).
By order of the Board
Niki van Wyk
Company Secretary
18 May 2022
Investec plc
Incorporated in England and Wales
Registration number: 3633621
Share code: INPP
ISIN: GB00B19RX541
LEI: 2138007Z3U5GWDN3MY22
Preference share dividend announcement
Non-redeemable non-cumulative non-participating preference shares ("preference
shares")
Declaration of dividend number 32
Notice is hereby given that preference dividend number 32 has been declared by
the Board from income reserves for the period 1 October 2021 to 31 March
2022 amounting to a gross preference dividend of 6.41369 pence per preference
share payable to holders of the non-redeemable non-cumulative
non-participating preference shares as recorded in the books of the Company at
the close of business on Friday 10 June 2022 .
For shares trading on the Johannesburg Stock Exchange (JSE), the dividend of
6.41369 pence per preference share is equivalent to a gross dividend of
127.01800 cents per share, which has been determined using the Rand/Pound
Sterling average buy/sell forward rate as at 11h00 (SA time) on Wednesday
18 May 2022.
The relevant dates relating to the payment of dividend number 32 are as
follows:
Last day to trade cum-dividend
On the Johannesburg Stock Exchange (JSE) Tuesday 7 June 2022
On the International Stock Exchange (TISE) Wednesday 8 June 2022
Shares commence trading ex-dividend
On the Johannesburg Stock Exchange (JSE) Wednesday 8 June 2022
On the International Stock Exchange (TISE) Thursday 9 June 2022
Record date (on the JSE and TISE) Friday 10 June 2022
Payment date (on the JSE and TISE) Monday 20 June 2022
Share certificates may not be dematerialised or rematerialised between
Wednesday 8 June 2022 and Friday 10 June 2022 , both dates inclusive, nor
may transfers between the United Kingdom share register and the South African
branch register take place between Wednesday 8 June 2022 and Friday 10 June
2022 both dates inclusive.
Additional information for South African resident shareholders of Investec plc
• Investec plc United Kingdom tax reference number: 2683967322360
• The issued preference share capital of Investec plc is 2 754 587
preference shares
• The dividend paid by Investec plc to shareholders recorded on the
South African branch register is subject to South African Dividend Tax
(Dividend Tax) of 20% (subject to any available exemptions as legislated)
• The net dividend amounts to 101.61440 cents per preference share for
preference shareholders liable to pay the Dividend Tax and 127.01800 cents per
preference share for preference shareholders exempt from paying the Dividend
Tax.
By order of the Board
David Miller
Company Secretary
18 May 2022
Investec plc
Incorporated in England and Wales
Registration number: 3633621
JSE share code: INPPR
ISIN: GB00B4B0Q974
LEI: 2138007Z3U5GWDN3MY22
Rand-denominated preference share dividend announcement
Rand-denominated non-redeemable non-cumulative non-participating perpetual
preference shares ("preference shares")
Declaration of dividend number 22
Notice is hereby given that preference dividend number 22 has been declared by
the Board from income reserves for the period 1 October 2021 to 31 March 2022
amounting to a gross preference dividend of 344.99315 cents per preference
share payable to holders of the Rand-denominated non-redeemable non-cumulative
non-participating perpetual preference shares as recorded in the books of the
Company at the close of business on Friday 10 June 2022.
The relevant dates relating to the payment of dividend number 22 are as
follows:
Last day to trade cum-dividend Tuesday 7 June 2022
Shares commence trading ex-dividend Wednesday 8 June 2022
Record date Friday 10 June 2022
Payment date Monday 13 June 2022
Share certificates may not be dematerialised or rematerialised between
Wednesday 8 June 2022 and Friday 10 June 2022, both dates inclusive.
Additional information for South African resident shareholders of Investec plc
• Investec plc United Kingdom tax reference number: 2683967322360
• The issued Rand-denominated preference share capital of Investec plc
is 131 447 preference shares
• The dividend paid by Investec plc to shareholders recorded on the
South African branch register is subject to South African Dividend Tax
(Dividend Tax) of 20% (subject to any available exemptions as legislated)
• The net dividend amounts to 275.99452 cents per preference share for
preference shareholders liable to pay the Dividend Tax and 344.99315 cents per
preference share for preference shareholders exempt from paying the Dividend
Tax.
By order of the Board
David Miller
Company Secretary
18 May 2022
Investec Limited
Incorporated in the Republic of South Africa
Registration number: 1925/002833/06
JSE share code: INPR
NSX ordinary share code: IVD
BSE ordinary share code: INVESTEC
ISIN: ZAE000063814
LEI: 213800CU7SM6O4UWOZ70
Preference share dividend announcement
Non-redeemable non-cumulative non-participating preference shares ("preference
shares")
Declaration of dividend number 35
Notice is hereby given that preference dividend number 35 has been declared by
the Board from income reserves for the period 1 October 2021 to 31 March 2022
amounting to a gross preference dividend of 282.26249 cents per preference
share payable to holders of the non-redeemable non-cumulative
non-participating preference shares as recorded in the books of the Company at
the close of business on Friday 10 June 2022.
The relevant dates for the payment of dividend number 35 are as follows:
Last day to trade cum-dividend Tuesday 7 June 2022
Shares commence trading ex-dividend Wednesday 8 June 2022
Record date Friday 10 June 2022
Payment date Monday 13 June 2022
Share certificates may not be dematerialised or rematerialised between
Wednesday 8 June 2022 and Friday 10 June 2022 both dates inclusive.
Additional information to take note of
• Investec Limited South African tax reference number: 9800/181/71/2
• The issued preference share capital of Investec Limited is
28 968 863 preference shares
• The dividend paid by Investec Limited is subject to South African
Dividend Tax (Dividend Tax) of 20% (subject to any available exemptions as
legislated)
• The net dividend amounts to 225.80999 cents per preference share for
shareholders liable to pay the Dividend Tax and 282.26249 cents per preference
share for preference shareholders exempt from paying the Dividend Tax.
By order of the Board
Niki van Wyk
Company Secretary
18 May 2022
Investec plc
Incorporated in England and Wales
Registration number 3633621
JSE ordinary share code: INP
LSE ordinary share code: INVP
ISIN: GB00B17BBQ50
LEI: 2138007Z3U5GWDN3MY22
Registered office:
30 Gresham Street, London
EC2V 7QP, United Kingdom
Registrars in the United Kingdom:
Computershare Investor Services PLC
The Pavilions, Bridgwater Road, Bristol
BS99 6ZZ, United Kingdom
Company Secretary:
David Miller
Investec Limited
Incorporated in the Republic of South Africa
Registration number 1925/002833/06
JSE ordinary share code: INL
NSX ordinary share code: IVD
BSE ordinary share code: INVESTEC
ISIN: ZAE000081949
LEI: 213800CU7SM6O4UWOZ70
Registered office:
100 Grayston Drive
Sandown, Sandton
2196 South Africa
Transfer secretaries in South Africa:
Computershare Investor Services (Pty) Ltd
Rosebank Towers, 15 Biermann Avenue, Rosebank
2196 South Africa
Company Secretary:
Niki van Wyk
Directors:
Philip Hourquebie(1) (Chair)
Fani Titi(2) (Chief Executive)
Nishlan Samujh(2) (Finance Director)
Richard Wainwright(2*) (Executive Director)
Ciaran Whelan(3) (Executive Director)
Henrietta Baldock(1)
Zarina Bassa(2) (Senior Independent Director)
David Friedland(2)
Stephen Koseff(2)
Nicky Newton-King(2*)
Jasandra Nyker(2*) (
) Vanessa Olver(2#)
Khumo Shuenyane(2)
Philisiwe Sibiya(2
) Brian Stevenson(1^)
1 British
2 South African
3 Irish
* Appointed 21 May 2021
^ Appointed 22 June 2021
(#) Appointed 18 May 2022
Charles Jacobs resigned 30 June 2021
Perry Crosthwaite and Lord Malloch-Brown resigned 5 August 2021
Sponsor:
Investec Bank Limited
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