Rand Merchant Bank (RMB), the corporate and investment banking arm of FirstRand pointed to a solid performance in its full-year financials, highlighting an 18% growth in core lending.<\/p>\n
Pre-tax profit was up 17% from June 2021, and the ROE improved to 22.1% – up from 18.7% at June 2021, it said on Thursday (15 September).<\/p>\n
\u201cOur results showed a continued improvement in the credit quality of RMB\u2019s core lending portfolio. We advanced R126 billion in new loans and refinancings across South Africa and broader Africa,” said RMB CEO James Formby.<\/p>\n
The increase in client demand is a sign of improving confidence, especially as much of the funding is earmarked for South African investment, the bank said. “It is part of the reason that South Africa, and many of its businesses, are looking more attractive to investors again.”<\/p>\n
\u201cThe growth in our advances book is before the impact of higher infrastructure investment, particularly in private power generation, which will support continued growth,” said Formby.<\/p>\n
Sustainability and transition finance transactions are a key focus, the group said. Notably, RMB issued the first and largest, at R8.45 billion, syndicated sustainability-linked loan in Africa for Mediclinic, and also the first green loan in the Sub-Saharan African real estate sector for Equites Property Fund.<\/p>\n
A total of 26 sustainable finance transactions were facilitated worth R26 billion, it said.<\/p>\n
The banking division grew profits by 20%. Investment banking\u2019s performance benefited from strong origination underpinning robust structuring and commitment fee income, said RMB.<\/p>\n
“Corporate transactional banking reported strong deposit growth, driven by increased primary banking relationships, higher levels of cross-selling and the build-out of invest deposit offerings.”<\/p>\n
The markets business, it said, delivered solid pre-tax profit growth of 11%, driven by strong client flow volumes, a robust performance from equities, resilient offshore secured financing activities and a reversal of pandemic-related risk reserves.<\/p>\n
Ashburton Investments, incorporated into RMB, turned profitable during the year.<\/p>\n
Private equity, said RMB, benefitted from strong annuity income growth of 32% as portfolio companies experienced improved operational performances, together with a small component of bad debt releases reflecting improved underlying performance of investee companies.<\/p>\n
\u201cThe cautious optimism we are witnessing in corporate South Africa is an early signal of renewed investment opportunities,\u201d said Formby. \u201cWe are excited to have a meaningful impact on each of our clients\u2019 growth journeys and thank them for continuing to choose RMB as their trusted banking partner.\u201d<\/p>\n