{"id":826176,"date":"2025-05-30T11:37:15","date_gmt":"2025-05-30T09:37:15","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=826176"},"modified":"2025-07-16T13:46:25","modified_gmt":"2025-07-16T11:46:25","slug":"major-new-bank-launching-in-south-africa-this-year","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/banking\/826176\/major-new-bank-launching-in-south-africa-this-year\/","title":{"rendered":"Major new bank launching in South Africa this year"},"content":{"rendered":"\n

Old Mutual is making progress with its new bank, as the company battles with increased client outflows. <\/p>\n\n\n\n

In a trading statement for Q1 2025, the group said that the launch of OM Bank remains on track. <\/p>\n\n\n\n

It said that internal customers are actively refining processes and enhancing the service experience ahead of the public rollout later this year. <\/p>\n\n\n\n

Old Mutual, which will not share the same name as OM Bank due to regulations, said the bank\u2019s national rollout will occur in Q4 2025<\/strong> following several delays. <\/p>\n\n\n\n

OM Bank appointed Clarence Nethengwe as CEO after spearheading the group\u2019s Mass and Foundation Cluster and Nomkhita Nqweni as chairwoman.<\/p>\n\n\n\n

Between 2022 and 2024, Old Mutual spent a combined R2.8 billion to build the bank and secure a deposit-taking retail banking license. <\/p>\n\n\n\n

The group expects the bank to run an initial loss run rate of R1.1 billion to R1.3 billion, which will reduce over time as the bank is expected to break even in 2028. <\/p>\n\n\n\n

It was previously noted that key milestones include a phased approach to customer acquisition and the Old Mutual Rewards Programme integration.<\/p>\n\n\n\n

The group hopes to leverage its existing customer base, trusted brand, and expansive distribution network to grow the bank. <\/p>\n\n\n\n

Its cloud-based platforms should offer a seamless, scalable single-facility account with debit, credit, overdraft and savings facilities with lower costs. <\/p>\n\n\n\n

With a focus on the retail mass market, OM Bank will primarily compete with Capitec, African Bank and Tyme Bank. <\/p>\n\n\n\n

The group\u2019s performance <\/strong><\/h2>\n\n\n
\n
\"\"<\/a><\/figure><\/div>\n\n\n

Looking at the group\u2019s performance, its Life APE sales were marginally lower than the prior period. <\/p>\n\n\n\n

This was primarily due to a decrease in guaranteed annuities sales in Personal Finance, which was in line with the overall market decline resulting from a drop in yields. <\/p>\n\n\n\n

The non-repetition of significant savings sales secured in the prior period in Old Mutual Corporate also further contributed to reducing sales. <\/p>\n\n\n\n

\u201cLarge corporate sales are lumpy by nature with long and sometimes unpredictable lead times,\u201d said the group.<\/p>\n\n\n\n

\u201cThis was partially offset by good risk sales across all distribution channels in Mass and Foundation Cluster as well as strong corporate sales in Old Mutual Africa Regions, particularly in Namibia and Malawi.\u201d <\/p>\n\n\n\n

Although gross flows increased by 6% amidst strong inflows in Wealth Management, net client cash outflow was adversely impacted by large outflows in Investments and Corporate.<\/p>\n\n\n\n

Old Mutual Investments reported low-margin indexation outflows of R6.4 billion from a large offshore investor that continues restructuring its existing investment mandate.<\/p>\n\n\n\n

The Higher outflows in Old Mutual Corporate were attributable to terminations of R3.6 billion regarding the exit of unprofitable business on an investment platform.<\/p>\n\n\n\n

As per its cautious lending strategy, loans and advances remained consistent with the prior period. <\/p>\n\n\n\n

The group\u2019s gross written premiums still grew by 7%, primarily due to fee increases in Old Mutual Insure, especially in the Speciality business. <\/p>\n\n\n\n

Old Mutual Insure also delivered growth of 12% in gross written premiums, with an underwriting margin well above the upper end of its 4% to 6% target range, coupled with strong investment performance.\u00a0<\/p>\n\n\n\n

\u201cThe growing diversity of insurance revenue makes Old Mutual Insure increasingly resilient with respect to claims correlated to climate change,\u201d said the group.<\/p>\n\n\n\n

Due to ongoing economic uncertainty and constrained household disposable income, the group has also not seen an improvement in its Mass and Foundation Cluster persistently. <\/p>\n\n\n\n

Key Performance Indicators <\/strong>(R million unless otherwise stated)<\/strong><\/td>31 March 2025<\/strong><\/td>31 March 2024<\/strong><\/td>change<\/strong><\/td><\/tr>
Life APE sales<\/td>3 095 <\/td>3 170<\/td>(2%)<\/td><\/tr>
Gross flows (1)<\/sup><\/td>53 208<\/td>50 178<\/td>6%<\/td><\/tr>
Net client cash flow <\/td>(4 834)<\/td>166<\/td>(>100%)<\/td><\/tr>
Loans and advances (2)<\/sup><\/td>18 672<\/td>18 761<\/td>(0%)<\/td><\/tr>
Gross written premiums<\/td>7 448 <\/td>6 936<\/td>7%<\/td><\/tr><\/tbody><\/table><\/div>
(1) The prior period amounts for Old Mutual Investments were re-presented to include institutional products that are an alternative to bank deposits on a net flow basis. (2) Comparative amounts represent FY2024 balance sheet amounts<\/figcaption><\/figure>\n","protected":false},"excerpt":{"rendered":"

OM Bank is set to launch in 2025 as Old Mutual continues to iron out the kinks in the new digital bank. <\/p>\n","protected":false},"author":95,"featured_media":721254,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[961],"tags":[1110,20634],"class_list":["post-826176","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banking","tag-old-mutual","tag-om-bank"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/826176","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=826176"}],"version-history":[{"count":9,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/826176\/revisions"}],"predecessor-version":[{"id":831797,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/826176\/revisions\/831797"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/721254"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=826176"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=826176"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=826176"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}