OLD MUTUAL PLC - Nedbank Group Third Quarter 2013 Trading Update

Nedbank Group – Third Quarter 2013 Trading Update

       OLD MUTUAL PLC
       ISIN: GB0007389926
       JSE SHARE CODE: OML
       NSX SHARE CODE: OLM
       ISSUER CODE: OLOML
       Old Mutual plc
       Ref 86/13
       28 October 2013


       NEDBANK GROUP – THIRD QUARTER 2013 TRADING UPDATE
                                                         
       Nedbank Group Limited (“Nedbank Group”), the majority owned South African banking subsidiary of
       Old Mutual plc, released its third quarter trading update for the three months ended 30 September
       2013, today, 28 October 2013.

       The following is the full text of Nedbank Group's announcement:

       “NEDBANK GROUP – THIRD QUARTER 2013 TRADING UPDATE

       “In a tough and volatile economic environment Nedbank performed solidly in the third quarter. Our
       focus on building the franchise continues to underpin non-interest revenue growth and proactive credit
       risk management strategies contributed to an improvement in the credit loss ratio.
       
       We continue to make satisfactory progress towards meeting our diluted headline earnings per share
       growth target for 2013”.
       
       Mike Brown
       Chief Executive

       OPERATIONAL PERFORMANCE

       Net interest income for the nine months ended 30 September 2013 (“the period”) grew by 8,3% to
       R15 725m (Q3 2012: R14 523m) with the net interest margin at 3,58% (Q3 2012: 3,52%) remaining
       stable since June 2013.
       
       The credit loss ratio at 1,15% (Q3 2012: 1,02%) for the period improved from 1,31% at June 2013.
       
       Non-Interest Revenue (NIR) increased by 14,2% to R14 166m (Q3 2012: R12 403m) reflecting slower
       growth in the quarter. Fee and commissions growth was 14,0%, insurance income grew 14,9% and
       trading income grew 6,2%. Fair value adjustments, a volatile contributor to NIR, were a positive
       R110m (Q3 2012: Negative R228m) resulting in NIR before fair value adjustments growing by 11,3%.
       
       Total advances grew 9,7% (annualised) to R566bn. Excluding trading advances, banking advances
       growth was 8,5%. Deposits increased 9,4% (annualised) to R590bn.
       
       The group’s capital adequacy ratios remain well within its respective internal target ranges with the
       common equity tier 1 ratio at 11,6% following the payment of the interim dividend in September 2013.


                                Q3 2013                  June 2013                               Regulatory
        Basel III        Unappropriated profits    Unappropriated profits    Internal target       minimum
                        Including     Excluding    Including     Excluding         range            2013                   

        Common
        equity tier 1    11,6%         11,0%         11,8%         11,3%       10,5% – 12,5%         4,5%
        ratio


        Tier 1 ratio     12,9%         12,3%         13,0%         12,5%       11,5% – 13,0%         6,0%


        Total capital
                         14,7%         14,0%         14,8%         14,4%       14,0% – 15,0%         9,5%
        ratio




       PROSPECTS
       The group’s forecast for gross domestic product (GDP) growth of 2,0% and an average consumer
       price index (CPI) of 5,9% for 2013 is reflective of continued pressures in the global and domestic
       economy.
       
       The group’s financial guidance to meet its medium-to-long-term diluted headline earning per share
       growth target (being, greater than or equal to GDP plus CPI plus 5%) in 2013 remains unchanged.
       
       Shareholders are advised that these forecasts and the figures stated in this trading update have not
       been reviewed or reported on by the group’s auditors.
               
       FORWARD-LOOKING STATEMENT
       
       This announcement contains certain forward looking statements with respect to the financial condition
       and results of operations of Nedbank Group and its group companies, which by their nature involve
       risk and uncertainty because they relate to events and depend on circumstances that may occur in
       the future. Factors that could cause actual results to differ materially from those in the forward-looking
       statements include, but are not limited to, global, national and regional economic conditions, levels of
       securities markets, interest rates, credit or other risks of lending and investment activities, together
       with competitive and regulatory factors.

       Sandton
       28 October 2013"


       Enquiries
       External communications
       Patrick Bowes                       UK     +44 20 7002 7440
       Investor relations
       Dominic Lagan                       UK     +44 20 7002 7190
       Kelly de Kock                       SA     +27 21 509 8709

       Media
       William Baldwin-Charles                    +44 20 7002 7133
                                                  +44 7834 524833
       
       Lead sponsor:
       Merrill Lynch South Africa (Pty) Ltd

       Joint Sponsor:
       Nedbank Capital

       Notes to Editors
       Old Mutual provides life assurance, asset management, banking and general insurance to more than
       14 million customers in Africa, the Americas, Asia and Europe. Originating in South Africa in 1845,
       Old Mutual has been listed on the London and Johannesburg Stock Exchanges, among others, since
       1999.
       In the year ended 31 December 2012, the Group reported adjusted operating profit before tax of £1.6
       billion (on an IFRS basis) and had £262 billion of funds under management from core operations.
       For further information on Old Mutual plc, please visit the corporate website at www.oldmutual.com


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