18th Sep 2020 08:22
(Alliance News) - Investec PLC and Ltd on Friday announced plans to cut its London office's headcount by 13% and does not anticipate declaring an interim dividend.
The Anglo-South African corporate and investment banking business expects adjusted earnings per share for the first half ending September 30 to be between 10.5p and 8.3p, down 53% to 63% from last year's 22.4p.
Basic earnings per share is expected to be between 8.4p and 6.5, down 56% to 66% from 19.0p a year prior.
Headline earnings per share is expected to be between 9.0p and 7.3p from 17.0p a year before, reflecting a decrease of 47% to 57%.
Third-party funds under management rose 14% to GBP51.40 billion on August 31 from GBP45.00 billion on March 31. Net inflows were positive at GBP391 million.
During the same five months, core loans and advances declined 1.3% to GBP24.6 billion on August 31 from GBP24.9 billion on March 31.
The bank plans on cutting its headcount in the London office by 13%, or by 210 roles, after enhancing efficiencies by more closely integrating business-enabling functions, Investec said.
The company said it expects elevated levels of expected credit losses, mainly driven by forward-looking macroeconomic scenarios.
In its trading statement on Friday, Investec said it does not expect to declare an interim dividend, down from 11.0p a year prior.
Chief Executive Fani Titi said: "The business has proved resilient in a period characterised by COVID-19 stringent lockdowns in the first quarter, followed by a gradual reopening of the economies. Severe GDP contractions and volatile financial markets negatively impacted revenues.
"Capital and liquidity ratios remain robust and are expected to be stable. Provisions for expected credit losses are expected to remain elevated in the period under review. Net asset value per share is expected to increase. Costs were well managed.
"The business is well positioned to support its clients through this challenging environment. We will continue to ensure the safety and wellbeing of our people and the integrity of our balance sheet."
Investec shares were down 1.1% at 136.85 pence each on Friday morning in London.
By Greg Roxburgh; [email protected]
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