Nedbank Group’s financial performance shows ongoing good strategic progress in a difficult environment

6 August 2025

Nedbank Group’s results for the six months to 30 June 2025, amid a challenging operating environment, reflects 6% growth in headline earnings (HE) to R8.4bn and return on equity (ROE) that improved slightly to 15.2% (H1 2024: 15.0%). The increase in HE was driven by non-interest revenue (NIR) and associate income growth, an ongoing improvement in the impairment charge, and good management of underlying expenses, partially offset by muted net interest income (NII) growth.

“The operating environment during the first half of the year was challenging,” said Jason Quinn, Nedbank Chief Executive. “Uncertainty relating to US policies, in particular tariffs, and geopolitical conflicts resulted in significant financial market volatility and reduced business confidence. In SA, economic recovery momentum slowed, resulting in real GDP growth declining to 0.1% in Q1 2025.

Against this backdrop, we did well to increase our diluted earnings per share by 7%.”

The group's balance sheet remained very strong. CET1 and tier 1 capital ratios of 13.1% and 14.7% were well above board-approved target ranges and SARB minimum requirements.  An interim dividend of 1 028 cents per share was declared by the group, up by 6% (2024 interim dividend: 971 cents per share) at a payout ratio of 57%.

Strategic Updates

Following the announcement of the organisational restructure of our Retail and Business Banking (RBB) and Wealth Clusters to unlock revenue growth and further efficiencies and productivity enhancements, we have since completed the formation of our Personal and Private Banking (PPB) cluster lead by Ciko Thomas as Managing Executive and announced the appointment of Andiswa Bata as Managing Executive of Business and Commercial Banking (BCB). 

“Regarding our investment in Ecobank Transnational Incorporated (ETI), we have concluded a strategic review of the group's financial investment, recognising the risks of continuing to hold onto the investment due to regulatory uncertainty and potential increasing capital requirements. As a result of the review, the group's financial investment in ETI has from 30 June 2025 been classified as a non-current asset held for sale in terms of IFRS 5,” said Quinn.

“The board has approved a formal plan to dispose of the investment, and we are currently engaging interested parties and, if a sale is concluded, it will be a clean deal subject only to normal regulatory approvals. This change represents a reset of Nedbank's strategy on the rest of the continent with a clear focus on the SADC and East Africa regions in businesses we own and control, and in areas where we can play to our strengths.”

Wins and gains

“We continue to make good progress with our strategic value unlocks,” said Quinn. 

Retail active and main banked clients grew at 6% to 7.3 million and 3.8 million respectively. The Nedbank Africa Regions client base increased by 11% to over 419 000, of which around 163 000 are main-banked, and we retained our 24% market share in SME clients, ranking #1 for best bank for start-ups and the most approachable bank for funding.

Digital volumes grew at double digits and digital sales recorded 70%.  Retail digital transaction volumes and values in SA grew by 15% and 16%, respectively. Digitally active retail clients increased by 8% to 3.2 million, representing more than 70% of retail main-banked clients.  Digitally active clients across the NAR business increased from 67% to 69% of its total active client base.

Nedbank Money app active clients increased by 10% to 2.8 million, while transaction volumes increased by 16% and transaction values increased by 14%. Nedbank Money App (Africa) users reported a 17% increase in app usage. The adoption rate of the Nedbank Business Hub (NBH) for activities across all juristic segments increased to 65% from 56% in the prior year. With the introduction of a new mobile app and the migration of our domestic transaction platform to NBH in 2025, this trend is expected to continue.

A key highlight for the period is that Nedbank's brand value increased by 24% to R20bn and ranked #8 among all South African companies, while our social media sentiment ranked second highest among all South African banks.

Under strategic portfolio tilt, Nedbank increased market share in retail and commercial deposits, home loans and vehicle finance.

“In line with our commitment to making a positive impact in the societies in which we operate, demonstrated by our continuous efforts towards the delivery of the United Nations (UN) Sustainable Development Goals (SDGs), lending that supports sustainable development finance increased to R189bn, including strong growth in renewable energy exposures to R47bn, where we are market leaders,” said Quinn.

NAR Performance:

• NAR HE up 63% to R1 183m, generating RoE of 28.6%. This considers reclassification of ETI financial investment.
• NAR HE up 24% when excluding this accounting adjustment
• SADC HE down 5% to R257m, generating RoE of 6.7%
• SADC NII up 15% to 1 428m
• SADC NIM increased to 8.08% (H1 2024: 7,58%) and an 11% increase in average loans and advances
• SADC NIR down 4% to R857m
• Impairments up 77% to R184m, driven by write-offs in Namibia on the retail home loan portfolio, adequacy of impairments reviews in Eswatini and ratings downgrade on Mozambique sovereign debt.

Some highlights in the SADC operations include the following:

• Our overall client numbers grew by 11% year-on-year, and 69% of this base is digitally active. A good showing given that our focus has been on rolling out our technology harmonisation, thus selective investment in digital solutions in lieu of this convergence journey.    

• Landing the foundational elements of our technology harmonisation journey, in Eswatini which includes improved client onboarding, enhanced teller functionality and the MiGoals offering.  

• We extended our Intelligent Depositor device rollout across Eswatini, Lesotho, Namibia and Zimbabwe with cash recycling capability.  

• Implemented robotic process automation, thus improving SLAs on credit application turnaround time and client experiences.  

• Awards we won include: 

1.       The Most Innovative Bank Africa 2025 (Mozambique) – Global Finance.  

2.      Best Digital Bank in 2025 (Mozambique) – Global Banking & Finance Review.  

3.      Best Bank for Corporate Investment Management Services 2025 (Lesotho) – Global Banking & Finance Review.  

4.      Best SME Bank in 2025 (Lesotho) – Global Banking & Finance Review

Looking Ahead

Looking ahead, the global economic outlook remains subdued, and risk elevated as US tariffs are expected to negatively impact business confidence, capital investment, global trade volumes, supply chains and export volumes in most countries.

SA’s economic recovery is expected to improve, driven by increased consumer spending given higher real incomes, subdued inflation, reduced interest rates and continued withdrawals from contractional savings.

“On the back of the negative impact of a more difficult-than-expected SA environment on revenue growth and change in our strategy regarding ETI, we have revised our 2025 guidance. We now expect DHEPS growth for the year to be low single digits and ROE to end the period around 15%. From there we target an improvement in the group's ROE to 17% in the medium term, supported by various growth initiatives and active capital management. In the long term our focus remains on achieving an ROE of more than 18%,” Quinn said.

“I value the dedication of our Nedbank colleagues and ongoing support of the investment community, regulators and our other stakeholders during the past 6 months, and remain grateful to our 7.9 million retail and wholesale clients for choosing Nedbank.  As Nedbank, we will continue to play our role in society as we fulfil our purpose of using our financial expertise to do good,” concluded Quinn.

For a detailed breakdown of business unit performance, please refer to SENS announcement and analyst booklet.

Ends.

Nedbank Integrated Communications

Annaleigh Vallie

Phone: +27 (0)66 479 0936

Email: annaleighv@nedbank.co.za

Joanne Isaacs

Phone: +27 (0)78 800 4989

Email: joannei@nedbank.co.za

About Nedbank Group

Nedbank Group is a bank holding company listed on the JSE Limited, with a market capitalisation of R118bn as at 30 June 2025. Nedbank is one of Africa’s largest banking groups, with operations in South Africa, Namibia, Eswatini, Mozambique, Lesotho and Zimbabwe, and offshore in the Isle of Man and Jersey. It also has representative offices in other Africa countries, including Kenya, and has key global financial centres to provide international banking services for SA-based multinational and high-net-worth clients in London and Dubai. The group is a diversified financial services provider, offering a wide range of wholesale and retail banking and financial services. Nedbank has maintained its level 1 BBBEE status for the past 7 years and rates in the top quartile.