THE DIRE performance of the investment banking industry claimed another scalp yesterday as Investec warned that earnings would fall by up to 27 per cent.
The bank, a Test cricket sponsor with a London listing, was hit by the global slump in primary deals, particularly in its South Africa homeland.
It experienced mixed results across the group with a return to profits in its core private bank, a “subdued” performance at its investment bank and an operating loss in Australia.
It said: “Volatile markets and low levels of activity have characterised the second half of the group’s 2012 financial year (to 31 March).”
Investec beat Canaccord in the battle to buy British investment bank Evolution last summer, which added £7.4bn of assets and will help it to boost assets under management by more than 11 per cent to £98.8bn.
Full-year adjusted earnings per share are expected to be 22 to 27 per cent lower than the previous year.
Chief executive Stephen Koseff said Investec – seeking to cut its reliance on traditional lending – expects an improved environment and a decline in impairments this year, depending on whether Europe can hold up.