ISH and South African bank Investec has posted surging profits for the last year, yesterday revealing bad loans had fallen sharply.
The lender is recovering from the financial crisis, winding down its back book of loans and building up its wealth management business.
Pre-tax operating profits came in at £452m in the year to March, up six per cent on the previous 12-month period.
Those figures were damaged by a sharp fall in the rand versus sterling – on a neutral currency basis, profits rose 20.3 per cent to £513m.
By unit, wealth and investment operating profits rose 30.5 per cent to £66.1m, while asset management profits rose 2.4 per cent to £143.8m.
Its South African specialist bank reported a 29.2 per cent profit rise, while its UK counterpart improved 29.9 per cent to a total of £157.4m.
Total group impairments fell 33.8 per cent on the back of an improving economic outlook.
At the same time, the credit loss charge as a percentage of total loans fell from 0.84 per cent a year ago to 0.68 per cent now.
“These are good results and have a lot to do with the core business and our focus on wealth management over the last couple of years, and the markets have had a good run, too,” Investec’s managing director Bernard Kantor told City A.M.
“Eighteen months ago we bought Evolution, and we are now getting the benefits of rationalising that acquisition in our wealth management arm.”
The dual-listed bank’s London shares slid 0.68 per cent on the day.