Nedbank Namibia’s resilience pays off
Net profit soars 54%
Nedbank Namibia remains the heavyweight in the Nedbank Group's SADC stall outside South Africa.
Nedbank Namibia yesterday reported a profit after tax of N$460 million for the year ended 31 December 2023, a spike of 54% compared to its 2022 financial year.After fair-value adjustments, Nedbank Namibia’s headline earnings came in at N$383 million, nearly 29% or N$85 million more than its previous book-year.
Speaking during a conference call on Nedbank Group’s latest annual results, Nedbank Namibia managing director Martha Murorua said the local financial institution “demonstrated strong resilience and delivered strong financial performance” in most of its key metrics.
A strong digital drive saw Nedbank Namibia increasing its digital penetration by 64% compared to 45% in 2022, Murorua said.
Results released by Nedbank, holding company of Nedbank Namibia, showed the Namibian franchise remains Nedbank’s heavyweight in the Southern African Development Community (SADC), excluding South Africa. Besides Namibia, Nedbank also has a presence Mozambique, Zimbabwe, Eswatini and Lesotho.
In terms of Nedbank’s SADC footprint, Nedbank Namibia contributed 32.7% of total clients, 31.3% of total revenue and 48.4% of total assets.
Group results
Nedbank's share price lifted more than 4% at one point yesterday after it raised its final dividend almost a fifth on the back of strong earnings growth.
The bank reported an 11% rise in headline earnings to R15.7 billion in the year to end-December, underpinned by robust revenue growth and prudent expense management.
With the group's return on equity (ROE) rising a percentage point to 15.1% for the year, the group upped its final dividend by 18% to R10.22 per share, taking the total to R18.93.
"Our strong financial performance in 2023 - together with the progress made in executing on our strategy and the underlying momentum in the business - gives us confidence in delivering on our medium-term targets ..." said Nedbank CEO Mike Brown, who retires at the group's 2024 AGM in May, in the results. The bank is targeting an ROE of 17% by the end of 2025 and 18% in the long term.
The solid 2023 results performance was partially offset by a 30% jump in the impairment charge rose to about R9.6 billion.
Almost 89% of group impairments stemmed from its retail and business banking (RBB) unit, which saw impairments rise 29% to R8.52 billion, as consumers struggled with higher interest rates, persistent inflation and an economy ravaged by load shedding. – Additional reporting by Fin24