Investec Plc · LSE:INVP
Investec — Investor Presentation (September 2007)
20 slides from Investec's investor presentation, Sep 20, 2007
Slide 1: Investec a distinctive specialist banking group
Investec a distinctive specialist banking group Investor pre-close briefing 20 September 2007 Proviso • Please note that matters discussed in today’s presentation may contain forward looking statements which are subject to various risks and uncertainties and other factors, including, but not limited
Slide 2: Operational review
Operational review • Proviso: unless otherwise stated, figures and trends discussed in the operational review relate to the five month period to 31 August 2007 (i.e. 1H08) and are intended to compare 1H08 vs 1H07 • Investec will release its results for the six months to 30 September 2007 on 15 Novem
Slide 3: Operating environment
Operating environment % move 31 Aug 2007 31 Mar 2007 30 Sept 2006 since Mar JSE ALSI 27 601 27 267 22 375 1.2% FTSE ALSI 3 168 3 283 3 050 -3.5% Australian All Ord 6 138 5 979 5 113 2.7% SA Prime 13.50% 12.50% 11.50% 1.00% UK Clearing Banks 5.75% 5.25% 4.75% 0.50% RBA cash rate target 6.50% 6.25% 6.
Slide 4: Divisional review: Private Banking
Divisional review Private Banking Loan portfolio • Strong lending turnover and Since 31 Mar 2007: 11.8% to £7.7bn transactional activity continue to Average: 19.9% to £7.3bn drive momentum across all geographies Deposits • Very strong performance in South Since 31 Mar 2007: 12.9% to £6.3bn Africa Av
Slide 5: Private Client Portfolio Management and Broking; Capital Markets
Private Client Portfolio Management and Broking Funds under management* • Strong performance benefiting Since 31 Mar 2007: from: Total: 0.6% to £22.0bn Average: 9.1% to £21.9bn – higher asset levels and SA only: 3.7% to R109.5bn volumes over the period Average SA only: 26.8% to R107.5bn – launch of
Slide 6: Capital Markets: Principal Finance; Kensington
Capital Markets: Principal Finance • Low exposure to US sub-prime representing 0.4% of group loan portfolio: – £29mn rated BBB and below (net of fair value adjustments) – £24mn rated A to AAA - bulk in AAA and AA (net of fair value adjustments) – Additional provisions which may not crystallise: £7mn
Slide 7: Investment Banking; Asset Management
Investment Banking • Agency and Advisory – UK and Australia - stable corporate finance pipeline in place – Good performance from SA - strong deal pipeline in place • Direct Investments and Private Equity – SA Private Equity portfolio has performed very well underpinned by a strong performance from t
Slide 8: Property Activities; Other Activities
Property Activities Assets under administration • SA Property Activities have performed strongly Since 31 Mar 2007: 9.3% to R28.3bn Average: 47.0% to R27.1bn • Sale of business to Growthpoint still requires Competition Tribunal approval R’bn 30 • Launched African Property Fund jointly with Investec
Slide 9: Additional aspects
Additional aspects Other information • Effective tax rate: expected to be between 26% to 27% • Increase in earnings attributable to minorities: – Largely due to improved performance of partially owned investments that have been consolidated • Weighted number of shares in issue for the six months to
Slide 10: Capital and Liquidity
Capital and Liquidity • We remain well capitalised: Capital adequacy ratio (31 August 2007) Investec plc 18.3% Investec Bank UK Limited 19.2% Investec Limited 14% Investec Bank Limited 13.5% • As at 14 September 2007 we held substantial cash and near cash around the world – SA: R34bn – UK and Europe
Slide 11: Conclusion
Conclusion Conclusion Growth in net Growth in fees and net interest commissions income Decline in other Revenue from (largely life principal income) transactions flat Balance operational risk Pools of Pools of third businesses with financial proprietary party assets risk businesses to build a risk c
Slide 12: Conclusion; Appendices
Conclusion “Our focus on balancing revenue streams and achieving diversity of earnings, both geographically and operationally, has stood the group in good stead over the period. Furthermore, the group’s asset quality remains sound as a result of disciplined risk management. Notwithstanding the adver
Slide 13: Operating profit before tax, goodwill and non-operating items
Operating profit before tax, goodwill and non-operating items: for the six months ended 30 September 2006 Southern UK & Total IFRS £'000 Africa Europe Australia Other group Private Banking 17,424 50,476 5,720 - 73,620 Private Client Portfolio Management * and Stockbroking 5,664 4,074 - - 9,738 Capit
Slide 14: Private Banking: retail deposits; funds under advice
Private Banking: retail deposits % Change 31 Aug 31 Mar 30 Sept 31 Mar YTD vs £'million 2007 2007 2006 2006 Mar 2007 UK and Europe 3,806 3,439 3,194 2,921 10.7% South Africa 2,142 1,850 1,596 1,650 15.7% Australia 332 271 240 202 22.8% Total deposits 6,280 5,560 5,030 4,773 12.9% % Change Home curre
Slide 15: SA Private Client Securities; Capital Markets loans and advances
SA Private Client Securities: funds under management % Change 31 Aug 31 Mar 30 Sept 31 Mar YTD vs R'million 2007 2007 2006 2006 Mar 2007 Discretionary 19,197 18,419 14,736 14,343 4.2% Non-discretionary 90,271 87,177 70,755 69,744 3.5% Total 109,468 105,596 85,491 84,087 3.7% Net inflows at cost over
Slide 16: Kensington: other statistics; Asset Management AUM
Kensington: other statistics 31 Mar 31 May 31 Aug Period ended 2007 2007 2007 Mortgage assets under management (£‘bn) 7.0 6.7 6.6 Weighted average current LTV of active portfolio (adjusted for house price inflation) 70.7% 71.1% 69.3% Loan impairment provision on balance sheet (£'mn) 53 52 49 Actual
Slide 17: Investec Asset Management: UK and global investment performance
Investec Asset Management: UK and global retail investment performance One year Three years 4th Quartile 4th Quartile 16.6% 11.9% 1st Quartile 33.3% 1st Quartile 3rd Quartile 42.9% 21.4% 3rd Quartile 18.8% 2nd Quartile 2nd Quartile 31.3% 23.8% Performance to 31 August 2007, excludes cash, cash plus
Slide 18: Investec Asset Management: SA investment performance
Investec Asset Management: SA retail investment performance One year Three years 4th Quartile 4th Quartile 11.1% 1st Quartile 6.3% 1st Quartile 22.2% 25.0% 3rd Quartile 18.7% 3rd Quartile 27.8% 2nd Quartile 38.9% 2nd Quartile 50.0% Performance to 31 August 2007. Source: Calculated from Standard & Po
Slide 19: SA Property Activities; total third party assets under management
SA Property Activities: assets under administration % Change 31 Aug 31 Mar 30 Sept 31 Mar YTD vs R'million 2007 2007 2006 2006 Mar 2007 South Africa 28,332 25,917 17,118 19,790 9.3% % Change 31 Aug 31 Mar 30 Sept 31 Mar YTD vs £'million 2007 2007 2006 2006 Mar 2007 South Africa 1,957 1,825 1,181 1,8
Slide 20: Investec a distinctive specialist banking group
Investec a distinctive specialist banking group Investor pre-close briefing 20 September 2007 20