This article first appeared on GuruFocus .
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Normalized Earnings Growth:11% increase.
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Return on Equity (ROE):Moving closer to the top of the 18% to 22% range.
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Net Income After Cost of Capital (NIACC):26% growth.
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Net Asset Value (NAV):Up 7%, excluding currency impacts, up 10%.
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Net Interest Income (NII):Up 8%.
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Non-Interest Revenue (NIR):Up 12%.
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Cost-to-Income Ratio:Below 49%.
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Credit Loss Ratio (CLR):86 basis points.
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FNB Earnings Growth:8% overall, with FNB SA up 10%.
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RMB Profits Before Tax:62% increase in in-country CIB businesses.
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WesBank Advances Growth:14% increase.
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Commercial Growth:9% increase in advances.
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Broader Africa Advances Growth:9% in constant currency, with Zambia up 35%.
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Group Margin:Up 8 basis points, excluding UK operations, up 15 basis points.
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Common Equity Tier 1 (CET1) Ratio:14.4%.
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New Branches Opened:18 new branches.
Release Date: March 05, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Firstrand Ltd ( FANDF ) reported a strong operational performance with an 11% increase in normalized earnings and a 26% growth in net income after cost of capital.
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The company's return on equity (ROE) is moving closer to the top of its stated range of 18% to 22%, demonstrating strong operational performance.
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Firstrand Ltd ( FANDF ) is in a position to grow dividends faster than earnings due to high ROE and excess capital generation.
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The company has seen strong growth in its client-facing franchises, with FNB growing earnings by 8% and RMB lifting margins and ROE significantly.
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The group's deposit franchises delivered good growth, contributing to a strong capital position with a CET1 ratio of 14.4%.
Negative Points
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The global macroeconomic environment remains uncertain, with geopolitical tensions and economic shocks posing risks.
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The UK operations faced challenges with NIM pressure and elevated borrowing costs, impacting performance.
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The Aldermore Group's ROE is below target due to hefty investments in operational efficiency and offshoring initiatives.
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Broader Africa's performance was impacted by macro pressures in Botswana and Mozambique, affecting profitability.
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The UK motor commission issue remains unresolved, with potential financial impacts pending the FCA's final redress scheme.
Q & A Highlights
Q: How sustainable is the growth in private equity realizations and global markets, and what impact will the UK motor commission issue have on dividends? A: Mary Vilakazi, CEO, explained that the diversified portfolio and strong franchises support sustainable growth. Emrie Brown, CEO of RMB Holdings, noted that the private equity portfolio is actively managed for continuous investments and realizations. The global markets recovery is seen as a normalization, though subject to geopolitical fluctuations. Regarding the UK motor commission issue, the capital position is strong enough to cover potential outcomes, ensuring dividends remain unaffected.
Q: What initiatives have driven customer growth at FNB, and how will you sustain the cost-to-income ratio improvement? A: Hetash Kellan, CEO at FNB, highlighted investments in infrastructure and personnel, including expanding the branch network and AgencyPlus locations. Markos Davias, CFO, emphasized the focus on positive jaws, managing costs relative to revenue growth, and reinvesting from the existing cost base to sustain the cost-to-income ratio improvement.
Q: What is FirstRand's strategy for surplus capital and expansion into East Africa? A: Mary Vilakazi, CEO, stated that the surplus capital is not earmarked for any large acquisitions but is maintained to navigate uncertainties, particularly in the UK. Andries Du Toit, Chief Value Officer, mentioned that East Africa is a key market for expansion, with ongoing evaluations for suitable opportunities while maintaining financial discipline.
Q: Can you elaborate on the UK motor commission issue timeline and its potential impact? A: Markos Davias, CFO, indicated that the FCA is expected to announce the final redress scheme by the end of March. The company is prepared for various scenarios, and any legal costs incurred will be charged against the provision, minimizing impact on future earnings.
Q: What are the prospects for FirstRand's broader Africa franchises and capital deployment? A: Mary Vilakazi, CEO, expressed optimism about growth in the Corporate and Commercial sectors in South Africa and broader Africa. The company is executing organic strategies and exploring inorganic opportunities to scale existing markets, with a focus on capturing growth in the region.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
