Nedbank Group · JSE:NED
Nedbank — Nedgroup Securities Investment Conference 2010
27 slides from Nedbank's conference presentation, Sep 22, 2010
Slide 1: Nedgroup Securities Investment Conference, 22 September 2010
Nedgroup Securities Investment Conference, 22 September 2010 Ingrid Johnson Group Managing Executive: Nedbank Retail & Business Banking
Slide 2: Nedbank Group at a glance
Nedbank Group at a glance • One of the four largest JSE listed banks in SA • Market capitalisation of approximately R71bn • Total assets of R591bn • Advances of R461bn • Universal bank - retail, wealth, commercial, corporate & investment banking • One of SA’s top wholesale banks • More than 5 millio
Slide 3: 2010 H1 Financial highlights…despite a tough environment
2010 H1 Financial highlights…despite a tough environment Headline earnings 8,3% Diluted HEPS growth 0,2% Tangible NAV per share 9,7% ROE (excl goodwill) 12,2% Core Tier 1 CAR ratio* 9,9% NIR 14,5% Credit loss ratio 146bps *Including unappropriated profits
Slide 4: Agenda
Agenda • Progress to date • Key trends that inform our strategy • Strategic focus areas • Summary & conclusion
Slide 5: Our strategic framework: Vision-led Values-driven
Our strategic framework: Vision-led Values-driven Building Africa’s most admired bank… Vision …by our staff, clients, shareholders, regulators & communities Great place to work ‘Deep Green’ Great place to bank Great place to invest aspirations Great at collaboration World-class at managing risk Comm
Slide 6: Progress against our vision set in 2004
Progress against our vision set in 2004 Today: In 2004: Highly rated Highly respected Staff Clients - Retail Clients – Wholesale Shareholders Regulators Communities & environment
Slide 7: Building a unique culture for competitive advantage (Barrett survey)
Building a unique culture for competitive advantage (Barrett survey) 2005 2010 1. cost-consciousness 1. accountability 2. profit 2. client satisfaction 3. accountability 3. client-driven 4. community 4. teamwork involvement 5. brand reputation 5. client-driven 6. being the best 6. process-driven 7.
Slide 8: Staff morale improving each year – staff survey results
Staff morale improving each year – staff survey results Overall Rewards, Recognition & Ethics Performance… Policies & Procedures 59.6 79.1 Direction 49.0 50.4 69.3 Diversity 57.2 Management Style 69.7 61.2 60.1 Relationships & Trust 55.7 Leadership 58.3 67.1 63.3 Operational Culture & Communication
Slide 9: Brand positioning shifts – good progress, but still behind peers
Brand positioning shifts – good progress, but still behind peers Big 3 >25% >97% Although Nedbank made most progress amongst peer group (in last 12 months and since 2006) – still a lot to do
Slide 10: Total shareholder returns – Nedbank 1st over 1 year, 2nd over 5 years
Total shareholder returns – Nedbank 1st over 1 year, 2nd over 5 years 40.0% 35.3% Total Shareholder Return 2009 35.0% 30.8% 30.0% 26.9% 23.9% 25.0% 20.0% 17.3% 15.0% 10.0% 5.0% 0.0% Total Shareholder Return - 'Big Five' South African Banks 120.0% Nedbank Total Standardbank Shareholder Absa FirstRand
Slide 11: FM Survey (2010) – 3rd most empowered SA company
FM Survey (2010) – 3rd most empowered SA company Standard Element Bank ABSAA Bank B FirstRand Bank C Investec Nedbank Bank D Bank 4 3 1 2 5 Ownership 14,04 16,10 18,07 17,35 11,59 3 4 5 1 2 Management Control 7,59 7,05 3,65 9,33 8,12 Employment Equity 5 8,53 1 10,77 4 8,54 1 10,77 3 9,31 Skills Deve
Slide 12: Building Africa's most admired bank
Building Africa’s most admired bank Keep doing the things we are good at… Balance sheet management Advances & deposits Wholesale banking Transformation, corporate culture & sustainability
Slide 13: Progress to date • Key trends that inform our strategy
• Progress to date • Key trends that inform our strategy • Strategic focus • Summary & conclusion
Slide 14: Key trends in our target market
Key trends in our target market Bank RoE’s are structurally declining Five years ago… Today…2010 Five year’s time… Share of GDP SADC economies 29 39 growing faster than 35 South Africa 61 South Africa… 71 65 SADC excl SA Source: Global Insight 1600 2.2x GDP in Africa expected GDP 2010-2020e 1.8x Afr
Slide 15: Key trends in our target market
Key trends in our target market Per capita income growth (SA) % 19 years 16 years 12 years JP Landman Source: BOE Private Clients, SA income per capita to increase further SA Banked Population (Millions of individuals) Source: SAARF Growing SA banked 0.9 8.8 8.4 6.1 24.2 population driven by 2020 yo
Slide 16: Key trends in our target market
Key trends in our target market Internet penetration and Broadband capacity High growth from 20 bandwidth, electronic, 15 Af rica Broadband internet, mobile & 10 capacity Terra bps 5 (f rom new cables) technology 0 RHS developments 00 01 02 03 04 05 06 07 08 09 10 11 12 13 Source: World Wide Worx, 2
Slide 17: Progress to date • Key trends that inform our strategy
• Progress to date • Key trends that inform our strategy • Strategic focus • Summary & conclusion
Slide 18: Building Africa's most admired bank
Building Africa’s most admired bank Keep doing the things we are good at… Balance sheet management Advances & deposits Wholesale banking Transformation, corporate culture & sustainability Focus on… Actively manage our portfolio towards high economic profit areas Grow NIR & primary banking across the
Slide 19: Strategic attractiveness
Actively manage our portfolio towards high economic profit areas EP pool attractiveness (Market view) High A A Grow faster/ invest Strategic attractiveness B Profitably in line B with the market C C Fix economics Low Low High Financial attractiveness
Slide 20: Grow NIR and primary clients across the spectrum
Grow NIR and primary clients across the spectrum Targeting medium-to-long-term NIR : expenses ratio of >85% Rm 10 000 100% 83.0% 75.5% 78.2% 7 000 75.4% 76.0% 74.5% 80% 4 000 60% 1 000 40% 2005 2006 2007 2008 2009 2010 June¹ December² NIR:Expenses³ 1: Commission & fees at June 2: Commission & fees a
Slide 21: …enabled by new innovative solutions and a focus on our clients' needs
…enabled by new innovative solutions and a focus on our clients’ needs Opportunities • Cross-sell across clusters across clusters • Medium- to long-term: Africa / Ecobank alliance • Wallstreet – rationalise 7 multi-interface applications Nedbank Capital • Innovative origination of carbon credits via
Slide 22: Reposition Retail onto a sustainable growth path
Reposition Retail onto a sustainable growth path “Delivering a choice of distinctive client-centred banking experiences that build many deep, enduring relationships with Nedbank” • Leverage small business, business banking & corporate client Harness relationships strengths • Product monolines – alig
Slide 23: Greater focus on African expansion
Greater focus on African expansion • Currently operate banks in 5 SADC countries Expand & grow • Existing niche competitive advantages in SADC • Continue to seek opportunities to grow scale in SADC Advisory • Angola & Kenya representative offices opened boutiques • Structured term trade & advisory •
Slide 24: Progress to date • Key trends that inform our strategy
• Progress to date • Key trends that inform our strategy • Strategic focus • Summary & conclusion
Slide 25: Building Africa's most admired bank
Building Africa’s most admired bank Keep doing the things we are good at… Balance sheet management Advances & deposits Wholesale banking Transformation, corporate culture & sustainability Focus on… Actively manage our portfolio towards high economic profit areas Grow NIR & primary banking across the
Slide 26: THANK YOU
THANK YOU
Slide 27: Disclaimer
Disclaimer Nedbank Group has acted in good faith and has made every reasonable effort to ensure the accuracy and completeness of the information contained in this document, including all information that may be defined as 'forward-looking statements' within the meaning of United States securities le
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