Absa Group Limited · JSE:ABG
Absa — H1 2025 Earnings Presentation
31 slides from Absa's earnings presentation, Aug 18, 2025
Slide 1: Absa Group 1H25 financial results
Absa Group 1H25 financial results 18 August 2025
Slide 2: Kenny Fihla, Group Chief Executive
Kenny Fihla Group Chief Executive
Slide 3: Charles Russon
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Slide 4: Difficult macro backdrop that remains highly uncertain
Difficult macro backdrop that remains highly uncertain Global environment Sub-Saharan Africa South Africa • New US administration increased • Social tension in some markets • Disappointing GDP growth global uncertainty significantly • Disinflation, policy rate cutting • US tariffs raised materially
Slide 5: Continued progress in 1H25
Continued progress in 1H25 Key performance metrics 1H24 1H25 Change (%) Diluted HEPS (c) 1 227.7 1 422.9 16 Ordinary DPS (c) 685 785 15 RoE (%) 14.0 14.8 Net interest margin (bps) 469 458 Cost-to-income ratio (%) 52.7 53.2 Credit loss ratio (bps) 123 100 NAV per share (R) 180 200 11 CET1 ratio (%) 1
Slide 6: Focus on execution priorities
Focus on execution priorities • Franchise driven sustainable growth • Client franchise focus • Top-down precise capital allocation • Productivity and efficiency programme for future investment 6
Slide 7: Most businesses grew earnings and Head Office trimmed
Most businesses grew earnings and Head Office trimmed Headline earnings (Rbn) 10% 6.4 5.9 1H24 1H25 23% 3.2 (12%) 35% 2.6 (47%) 1.9 0.8 1.1 1.7 (0.5) (1.0) CIB Personal and Business Banking ARO RBB Head Office, Private Banking Treasury, other Pre-provision profit growth: 5% (3%) (7%) 20% - RoRC: 21.
Slide 8: CIB momentum from diversified franchise
CIB momentum from diversified franchise Headline earnings (Rm) 10% 6 440 1H24 1H25 5 863 20% 4 312 16% 3 583 3 606 3% 3 105 (7%) 2 758 2 834 2 280 2 128 Corporate Bank Investment Bank Total CIB South Africa ARO Pre-provision profit growth: (9%) 15% 5% 4% 7% 8 Note: In constant currency total CIB hea
Slide 9: PPB lending businesses drove earnings recovery
PPB lending businesses drove earnings recovery Headline earnings (Rm) 1H24 1H25 23% 3 168 2 578 (2%) 1 526 1 492 8% 12% 115% 719 775 >100% 125 269 125 546 614 39 332 (17%) ( 377) (314) Transactions Unsecured Home Loans Vehicle and Insurance SA Retail Other Personal and and Deposits Lending Asset Fin
Slide 10: Muted Business Banking revenue growth
Muted Business Banking revenue growth Business Banking revenue (Rbn) Business Banking earnings (Rbn) (2%) 3% 1H24 1.9 (12%) 3.4 3.3 3.2 1H25 3.1 1.7 (3%) 1.1 1.0 Lending Transactional and Payments products deposits 1H24 1H25 10
Slide 11: ARO RBB Banking operations drove strong growth
ARO RBB Banking operations drove strong growth Headline earnings (Rm) 42% 35% 1 108 1H24 1H25 1 092 782 810 <(100)% 28 (16) Banking operations Insurance operations ARO RBB RoRC 15.6% (4.1%) 14.5% 11
Slide 12: Solid growth across South Africa and Africa regions
Solid growth across South Africa and Africa regions Headline earnings (Rm) 17% 1H24 1H25 11 874 10 180 19% 7 828 6 589 13% 3 591 4 046 South Africa Africa regions Group Pre-provision profit growth: 0% 12% 4% RoRC: 14.3% 16.9% 12
Slide 13: Deon Raju, Group Financial Director
Deon Raju Group Financial Director
Slide 14: Pre-provision profit and improving CLR drove earnings
Pre-provision profit and improving CLR drove earnings Headline earnings (Rbn) Pre-provision profit up 4% 7% 10% 6% (14%) (0.5) 17% 3% 1.8 1.7 (1.1) 1.0 11.9 10.2 Revenue up 5% 1H24 Net interest Non-interest Operating Credit Other* 1H25 income income expenses impairments 14 Note: * Includes other exp
Slide 15: Modest net interest income growth from South Africa
Modest net interest income growth from South Africa Divisional net interest income (Rbn) (1%) 13.0 12.8 1H24 1H25 3% 10.6 10.9 15% 1% 7.0 6.1 5.2 5.3 Personal and Private Banking Business Banking ARO RBB CIB 15
Slide 16: Deposit margin the main drag on Group NIM
Deposit margin the main drag on Group NIM Change in net interest margin* (basis points) 7 469 (5) (1) 1 (11) 462 (15) 8 458 4 (6) 3 Loans Deposits (6) (17) 1H23 1H24 Pricing Mix Pricing Mix Endowment Capital ** Hedge *** Other 1H25 16 Note: * average interest bearing assets; ** group equity endowmen
Slide 17: Broad-based deposit growth, CIB and ARO RBB strong
Broad-based deposit growth, CIB and ARO RBB strong Customer deposits (Rbn) 1H24 1H25 11% 1402 1262 15% 7% 539 8% 470 339 363 17% 216 235 128 150 Personal and Private Business Banking ARO RBB CIB Group Banking 17
Slide 18: Relatively moderate loan growth …
Relatively moderate loan growth … Net customer loans (Rbn) 7% 1,319 1,233 1H24 1H25 3% 12% 517 553 504 495 5% 9% 146 154 91 84 Personal and Private Business Banking ARO RBB CIB Group Banking 18
Slide 19: … with muted Private and Personal Banking loan growth
… with muted Private and Personal Banking loan growth Private and Personal Banking net customer loans (Rbn) 2% 307 313 1H24 1H25 5% 116 122 1% 70 71 4% 10 11 Home Loans Vehicle and Asset Transactions and Deposits Unsecured Lending Finance 19
Slide 20: Strong Markets drove non-interest income growth
Strong Markets drove non-interest income growth Non-interest income (Rbn) 5% 13.2 12.5 1H24 1H25 36% 5.1 3.7 (47%) 5% 0.7 0.3 1.5 1.5 Net fee and commission Net trading Insurance Other 20 Note: Net trading excludes the impact of hedge accounting
Slide 21: Cost growth reflects inflationary growth
Cost growth reflects inflationary growth 1H25 Change Rm % Cost-to-income ratio (%) Staff 17 294 7 Property 981 1 53.2 52.3 52.7 Technology 3 581 7 Depreciation 1 583 2 50.6 Professional fees 1 435 6 Marketing 1 169 6 Communication * 828 5 Cash transportation 506 (18) Amortisation 1 429 3 Other ** 1
Slide 22: Lower CIB and PBB charges reduced credit impairments
Lower CIB and PBB charges reduced credit impairments Credit impairment charge (Rm) 6 298 1H24 1H25 (16%) 5 307 15% 23% (44%) 711 818 915 401 494 516 Personal and Private Business Banking ARO RBB CIB Banking 22 Note: Excludes Head Office credit impairment charge of R38m, (1H24: R16m release).
Slide 23: Credit loss ratio improved materially
Credit loss ratio improved materially Group credit loss ratio (bps) Credit loss ratio (%) 1H24 1H25 127 123 Target range 75-100 PPB 2.34 1.93 100 Unsecured Lending 8.69 7.66 Home Loans 0.49 0.47 Vehicle and Asset Finance 2.32 1.66 Business Banking 0.54 0.64 ARO RBB 1.61 1.69 CIB 0.33 0.18 Group 1.23
Slide 24: NPLs improved slightly, coverage remains strong
NPLs improved slightly, coverage remains strong Non-performing loans (%) NPL coverage (%) 47.1 47.4 46.9 6.14 6.12 5.90 1H24 FY24 1H25 Total loan coverage (%) 4.2 4.1 4.0 1H24 FY24 1H25 1H24 FY24 1H25 24
Slide 25: Head Office loss improved significantly in 1H25
Head Office loss improved significantly in 1H25 Head Office, Treasury and other operations loss (Rm) 1 007 (385) (253) 169 538 0.0 1H24 Group Treasury Ghana hyperinflation Costs/taxes 1H25 accounting 25
Slide 26: CET1 ratio at top end of our Board target range
CET1 ratio at top end of our Board target range Group common equity tier 1 ratio (%) 1.0 (0.5) 12.6 (0.6) 12.5 Board target range 11.0% - 12.5% FY24 RWA Profit Dividend 1H25 26
Slide 27: 2025 outlook
2025 outlook Mid-single digit revenue growth with stronger growth in non-interest revenue than net interest Revenue income. Balance sheet Mid- to high single digit customer loan growth and mid-single digit customer deposit growth. Credit loss ratio expected to improve to top end of through-the-cycle
Slide 28: Kenny Fihla, Group Chief Executive
Kenny Fihla Group Chief Executive
Slide 29: Disclaimer
Disclaimer Certain statements (words such as ‘anticipates’, ‘estimates’, ‘expects’, ‘projects’, ‘believes’, ‘intends’, ‘plans’, ‘may’, ‘will’ and ‘should’ and similar expressions in this document are forward looking. These relate to, among other things, the plans, objectives, goals, strategies, futu
Slide 30: Appendix: Divisional RoRC restatement FY24
Appendix: Divisional RoRC restatement FY24 As Reportable Business Revised previously segment Restated portfolio2 capitalisation reported changes1 (%) (%) rate3 (%) (%) (%) Personal and Private Banking 19.3 (1.3) (1.2) 16.8 Business Banking (previously Relationship Banking) 24.9 0.3 - (2.3) 22.9 ARO
Slide 31: Appendix: Head Office reallocations FY24
Appendix: Head Office reallocations FY24 PPB BB ARO RBB CIB Head Rm Office Depositor insurance (120) (70) (6) 196 B-BBEEE costs (190) (60) (140) (70) 460 Other (mainly recharges) (126) (65) (107) 7 291 Headline earnings impact (368) (159) (165) (60) 752 Net change in regulatory capital 2 774 1 442 (