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INVESTEC BANK LIMITED - Preliminary condensed consolidated financial results for the year ended 31 March 2019

Release Date: 16/05/2019 07:58
Code(s): INLP     PDF:  
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Preliminary condensed consolidated financial results for the year ended 31 March 2019

Investec Bank Limited
Incorporated in the Republic of South Africa
Registration number: 1969/004763/06
Share code: INLP
ISIN: ZAE000048393
 
Preliminary condensed
consolidated financial results
for the year ended 31 March 2019

Condensed consolidated income statement
For the year to 31 March                                                                                           Reviewed        Audited
R'million                                                                                                              2019           2018
Interest income                                                                                                      33 611         31 687   
Interest expense                                                                                                   (25 324)       (24 125)   
Net interest income                                                                                                   8 287          7 562   
Fee and commission income                                                                                             2 662          2 458   
Fee and commission expense                                                                                            (401)          (213)   
Investment income                                                                                                       360            530   
Share of post taxation profit of associates                                                                           1 163            777   
Trading income/(loss) arising from                                                                                                           
- customer flow                                                                                                         369            356   
- balance sheet management and other trading liabilities                                                                210           (26)   
Other operating income                                                                                                    -              2   
Total operating income before expected credit losses/impairment losses                                               12 650         11 446   
Expected credit loss impairment charges*                                                                              (722)              -   
Impairment losses on loans and advances*                                                                                  -          (720)   
Operating income                                                                                                     11 928         10 726   
Operating costs                                                                                                     (6 547)        (6 100)   
Operating profit before goodwill and acquired intangibles                                                             5 381          4 626   
Impairment of goodwill                                                                                                  (3)              -   
Amortisation of acquired intangibles                                                                                   (51)           (51)   
Operating profit                                                                                                      5 327          4 575   
Financial impact of acquisition of subsidiary                                                                            10          (100)   
Profit before taxation                                                                                                5 337          4 475   
Taxation on operating profit before acquired intangibles                                                              (391)            184   
Taxation on acquired intangibles                                                                                         14             14   
Profit after taxation                                                                                                 4 960          4 673   
Loss attributable to other non-controlling interests                                                                      3              -   
Earnings attributable to shareholders                                                                                 4 963          4 673   

* On adoption on IFRS 9, there is a move from an incurred loss model to an expected credit loss methodology.


Calculation of headline earnings
For the year to 31 March                                                                                           Reviewed        Audited
R'million                                                                                                              2019           2018
Earnings attributable to shareholders                                                                                 4 963          4 673
Dividend paid to perpetual preference shareholders and Additional Tier 1 security holders                             (172)          (133)
Earnings attributable to ordinary shareholders                                                                        4 791          4 540
Headline adjustments, net of taxation^                                                                                  (7)           (94)
Gain on realisation of available-for-sale assets recycled to the income statement                                         -           (94)
Impairment of goodwill                                                                                                    3              -
Financial impact of acquisition of subsidiary                                                                          (10)              -
Headline earnings attributable to ordinary shareholders                                                               4 784          4 446

^ These amounts are net of taxation of Rnil (2018: R36.6 million) with no impact on non-controlling interests in the current and prior year.


Consolidated statement of total comprehensive income                                                                                        
For the year to 31 March                                                                                           Reviewed        Audited   
R'million                                                                                                              2019           2018   
Profit after taxation                                                                                                 4 960          4 673   
Other comprehensive income:                                                                                                                  
Items that may be reclassified to the income statement                                                                                       
Fair value movements on cash flow hedges taken directly to other comprehensive income*                                   63           (99)   
Fair value movements on available-for-sale assets taken directly to other comprehensive income^*                          -            494   
Gain on realisation of available-for-sale assets recycled through the income statement^*                                  -           (94)   
Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income^*                      (119)              -   
Gain on realisation of FVOCI recycled through the income statement^*                                                   (89)              -   
Foreign currency adjustments on translating foreign operations                                                          903          (637)   
Items that will never be reclassified to the income statement                                                                                
Fair value movements on equity instruments at FVOCI taken directly to other comprehensive income                      (461)              -   
Net gain attributable to own credit risk                                                                                  2              -   
Total comprehensive income                                                                                            5 259          4 337   
Total comprehensive income attributable to ordinary shareholders                                                      5 090          4 204
Total comprehensive loss attributable to non-controlling interests                                                      (3)              - 
Total comprehensive income attributable to perpetual preference shareholders and other Additional               
Tier 1 security holders                                                                                                 172            133   
Total comprehensive income                                                                                            5 259          4 337   

^ On adoption of IFRS 9 on 1 April 2018, the fair value reserve was introduced replacing the available-for-sale reserve.
* These amounts are net of taxation of R472.1 million [2018: (R266.1 million)].


Condensed consolidated statement of changes in equity             
Year to 31 March                                                                                                   Reviewed        Audited   
R'million                                                                                                              2019           2018 
Balance at the beginning of the year                                                                                 38 415         35 165
Adoption of IFRS 9                                                                                                    (894)              -      
Total comprehensive income                                                                                            5 259          4 337   
Dividends paid to ordinary shareholders                                                                               (850)        (1 304)   
Dividends declared to perpetual preference shareholders and other Additional Tier 1 security holders                  (172)          (133)   
Issue of other Additional Tier 1 securities in issue                                                                    110            350   
Acquisition of subsidiary                                                                                               (1)              -   
Net equity movements of interest in associated undertaking                                                            (109)              -   
Other equity movements                                                                                                    2              -   
Balance at the end of the year                                                                                       41 760         38 415   
Condensed consolidated cash flow statement                                                                                                   


For the year to 31 March                                                                                           Reviewed        Audited   
R'million                                                                                                              2019           2018
Cash inflow from operations                                                                                           4 197          4 185
Increase in operating assets                                                                                       (23 511)       (21 277)    
Increase in operating liabilities                                                                                    26 729         15 244   
Net cash inflow/(outflow) from operating activities                                                                   7 415        (1 848)   
Net cash outflow from investing activities                                                                          (2 589)          (267)   
Net cash outflow from financing activities                                                                          (1 273)        (1 019)   
Effects of exchange rate changes on cash and cash equivalents                                                         1 175          (864)   
Net increase/(decrease) in cash and cash equivalents                                                                  4 728        (3 998)   
Cash and cash equivalents at the beginning of the year                                                               26 026         30 024   
Cash and cash equivalents at the end of the year                                                                     30 754         26 026   


Cash and cash equivalents is defined as including: cash and balances at central banks, on demand loans and advances to banks and
non-sovereign and non-bank cash placements (all of which have a maturity profile of less than three months).


For the year to 31 March                                                                                           Reviewed        Audited   
R'million                                                                                                              2019           2018 
Net cash (outflow)/inflow of subordinated liabilities                                                                 (361)             68   
Dividends paid                                                                                                      (1 022)        (1 437)   
Issue of other Additional Tier 1 securities                                                                             110            350   
Net cash outflow from financing activities                                                                          (1 273)        (1 019)   


Consolidated balance sheet                                                                                                                 
                                                                                                   Reviewed         Audited        Audited
At                                                                                                 31 March         1 April       31 March   
R'million                                                                                              2019           2018*          2018*   
Assets                                                                                                                                       
Cash and balances at central banks                                                                   10 290           9 180          9 187   
Loans and advances to banks                                                                          19 903          17 263         17 265   
Non-sovereign and non-bank cash placements                                                           12 192           9 972          9 993
Reverse repurchase agreements and cash collateral on securities borrowed                             18 552          20 480         20 480   
Sovereign debt securities                                                                            60 893          62 363         62 403   
Bank debt securities                                                                                 12 526           8 033          8 051   
Other debt securities                                                                                13 553          10 357         10 342   
Derivative financial instruments                                                                      7 700          12 564         12 586   
Securities arising from trading activities                                                            5 059             875            875   
Investment portfolio                                                                                  7 664           9 124          7 943   
Loans and advances to customers                                                                     261 737         245 162        247 474   
Own originated loans and advances to customers securitised                                            7 667           6 826          6 830   
Other loans and advances                                                                                329             265            265   
Other securitised assets                                                                                232             241            241   
Interests in associated undertakings                                                                  6 251           6 288          6 288   
Deferred taxation assets                                                                              1 514             933            586   
Other assets                                                                                          8 237           6 673          6 686   
Property and equipment                                                                                2 563           2 494          2 494   
Investment properties                                                                                     1               1              1   
Goodwill                                                                                                171             171            171   
Intangible assets                                                                                       418             412            412   
Loans to group companies                                                                             18 151          13 499         13 499   
                                                                                                    475 603         443 176        444 072   
Liabilities                                                                                                                                  
Deposits by banks                                                                                    30 041          24 607         24 607   
Derivative financial instruments                                                                     11 097          15 907         15 907   
Other trading liabilities                                                                             4 468           2 305          2 305   
Repurchase agreements and cash collateral on securities lent                                         15 234           8 395          8 395   
Customer accounts (deposits)                                                                        341 710         321 861        321 893   
Debt securities in issue                                                                              6 512           3 473          3 473   
Liabilities arising on securitisation of own originated loans and advances                            1 720           1 551          1 551   
Current taxation liabilities                                                                            542             202            202   
Deferred taxation liabilities                                                                            78              99             99   
Other liabilities                                                                                     6 263           6 874          6 844   
Loans from group companies                                                                            2 260           7 007          7 007   
                                                                                                    419 925         392 281        392 283   
Subordinated liabilities                                                                             13 918          13 374         13 374   
                                                                                                    433 843         405 655        405 657   
Equity                                                                                                                                       
Ordinary share capital                                                                                   32              32             32   
Share premium                                                                                        14 885          14 885         14 885   
Other reserves                                                                                        1 790           1 353          1 293   
Retained income                                                                                      24 597          20 901         21 855   
Shareholders' equity excluding non-controlling interests                                             41 304          37 171         38 065   
Other Additional Tier 1 securities in issue                                                             460             350            350   
Non-controlling interests                                                                               (4)               -              -   
Total equity                                                                                         41 760          37 521         38 415   
Total liabilities and equity                                                                        475 603         443 176        444 072   

*   The 1 April 2018 balance sheet has been presented on an IFRS 9 basis and the comparative as at 31 March 2018 on an IAS 39 basis.         


Liquidity coverage ratio disclosure
The objective of the liquidity coverage ratio (LCR) is to promote the short-term resilience of the liquidity risk profile of banks by ensuring
that they have sufficient high quality liquid assets to survive a significant stress scenario lasting 30 calendar days.

In accordance with the provisions of section 6(6) of the South African Banks Act 1990 (Act No. 94 of 1990), banks are directed to comply
with the relevant LCR disclosure requirements. This disclosure Template LIQ1 is in accordance with Pillar 3 of the Basel III liquidity accord,
as specified by BCBS d400 (2017) and Directive 01/2018.

The following table sets out the LCR for the group and bank:

                                                                                            Investec Bank Limited    Investec Bank Limited
                                                                                            Solo - Total weighted     Consolidated Group -
                                                                                                            value     Total weighted value
                                           
High quality liquid assets (HQLA) (R'million)                                                              81 086                   82 331
Net cash outflows (R'million)                                                                              59 881                   57 018
Actual LCR (%)                                                                                              135.6                    144.6
Required LCR (%)                                                                                            100.0                    100.0

The values in the table are calculated as the simple average of 90 calendar daily values over the period 1 January 2019 to 31 March
2019 for Investec Bank Limited (IBL) bank solo. Investec Bank Limited consolidated group use daily values for IBL bank solo, while those
for other group entities use the average of January, February, March 2019 month-end values.

Net stable funding ratio disclosure
The objective of the net stable funding ratio (NSFR) is to promote the resilience in the banking sector by requiring banks to maintain a
stable funding profile in relation to the composition of their assets and off-balance sheet activities on an ongoing structural basis.

In accordance with the provisions of section 6(6) of the South African Banks Act 1990 (Act No. 94 of 1990), banks are directed to comply
with the relevant NSFR disclosure requirements. This disclosure Template LIQ2 is in accordance with Pillar 3 of the Basel III liquidity
accord, as specified by Directive 11/2015 and Directive 01/2018.

The following table sets out the NSFR for the group and bank:
 
                                                                                            Investec Bank Limited    Investec Bank Limited
                                                                                            Solo - Total weighted     Consolidated Group -
                                                                                                            value     Total weighted value
                                               
Available stable funding (ASF) (R'million)                                                                303 165                  315 194
Required stable funding (RSF) (R'million)                                                                 262 357                  269 824
Actual NSFR (%)                                                                                             115.6                    116.8
Required NSFR (%)                                                                                           100.0                    100.0


Commentary
These reviewed year-end condensed consolidated financial
results are published to provide information to holders of
Investec Bank Limited's listed non-redeemable, non-cumulative,
non-participating preference shares.

Overview of results

Investec Bank Limited, a subsidiary of Investec Limited, posted an
increase in headline earnings attributable to ordinary shareholders
of 7.6% to R4 784 million (2018: R4 446 million).

The balance sheet remains sound with a capital adequacy ratio
of 15.8% (1 April 2018: 15.4%), a common equity tier one ratio of
11.2% (1 April 2018: 10.7%) and a leverage ratio of 7.7% (1 April
2018: 7.6%). Investec Bank Limited has received regulatory
permission to adopt the Foundation Internal Ratings Based
(FIRB) approach, effective 1 April 2019, resulting in a pro-forma
CET1 ratio of 12.5% had the FIRB approach been applied as of
31 March 2019.

For full information on the Investec Group results, refer to the
combined results of Investec plc and Investec Limited on the
group's website http://www.investec.com.

Financial Review

Unless the context indicates otherwise, all comparatives referred
to in the financial review relate to the year ended 31 March 2018.

Salient operational features for the year under review include:

Total operating income before expected credit loss impairment
charges increased by 10.5% to R12 650 million (2018:
R11 446 million). The components of operating income are
analysed further below:

- Net interest income increased 9.6% to R8 287 million
  (2018: R7 562 million) supported by higher net margins and
  continued lending activity from our private client base

- Net fee and commission income increased 0.7% to
  R2 261 million (2018: R2 245 million). Good growth and activity
  levels from our private client base and Investec For Business
  was offset by lower investment banking and corporate client
  activity levels

- Investment income decreased 32.1% to R360 million
  (2018: R530 million) impacted by a weaker performance from
  the listed and unlisted investment portfolio

- Share of post taxation profit of associates of R1 163 million
  (2018: R777 million) reflects earnings in relation to the bank's
  investment in the IEP Group. The increase is largely driven by a
  realisation within the IEP Group

- Total trading income increased significantly amounting to
  R579 million (2018: R330 million), primarily reflecting translation
  gains on foreign currency equity investments (partially
  offsetting the related weaker investment income performance).

Expected credit loss (ECL) impairment charges increased
marginally by 0.3% to R722 million (2018: R720 million under the
IAS 39 incurred loss model), however, the credit loss ratio reduced
to 0.27% (2018: 0.28%), remaining at the lower end of its long term
average trend. Stage 3 assets (net of ECL impairment charges)
as a percentage of net core loans subject to ECL remained 0.7%
(1 April 2018: 0.7%).

The cost to income ratio improved to 51.7% (2018: 53.5%).
Operating costs increased 7.3% to R6 547 million
(2018: R6 100 million) impacted by the prior-year rental
provision release.

As a result of the foregoing factors operating profit (before
amortisation of acquired intangibles and impairment of goodwill)
increased by 16.3% to R5 381 (2018: R4 626 million). The increase
in profit before tax was partially offset by a higher tax charge
resulting in overall profit after taxation increasing by 6.1% to
R4 960 million (2018: R4 673 million).

Basis of preparation
The condensed consolidated financial statements are prepared
in accordance with the requirements of the JSE Limited Listings
Requirements for preliminary reports and the requirements of
the Companies Act of South Africa. The Listings Requirements
require preliminary reports to be prepared in accordance with
the framework concepts and the measurement and recognition
requirements of International Financial Reporting Standards
(IFRS) and the SAICA Financial Reporting Guides as issued by the
Accounting Practices Committee and Financial Pronouncements
as issued by Financial Reporting Standards Council and to also,
as a minimum, contain the information required by IAS 34 Interim
Financial Reporting.

The accounting policies applied in the preparation of the
condensed consolidated financial statements are in terms of IFRS
and are consistent with those applied in the previous consolidated
annual financial statements except as noted below.

The group has adopted the following new standards and
amendments to standards, including any consequential
amendments to other standards: IFRS 9 Financial Instruments
and IFRS 15 Revenue from contracts with customers.

The financial results have been prepared under the supervision of
Nishlan Samujh, the group Finance Director. The annual financial
statements for the year ended 31 March 2019 will be posted to
stakeholders on 28 June 2019. These annual financial statements
will be available on the group's website on the same date.

On behalf of the Board of Investec Bank Limited

Khumo Shuenyane                   Richard Wainwright
Chairman                          Chief Executive Officer

15 May 2019


Review conclusion

The condensed consolidated financial statements for the year
ended 31 March 2019 have been reviewed by KPMG Inc.
and Ernst & Young Inc., who expressed an unmodified review
conclusion. A copy of the auditors' review report is available for
inspection at the company's registered office together with the
financial statements identified in the auditors' report.

The auditors' report does not necessarily report on all of the
information contained in these financial results. Shareholders are
therefore advised that in order to obtain a full understanding of
the nature of the auditors' engagement, they should obtain a copy
of the auditors' report together with the accompanying financial
information from the issuer's registered office.

Net fee and commission income
For the year to 31 March
R'million                                                                                                              2019           2018
Corporate and institutional transactional and advisory services                                                       1 542          1 656
Private client transactional fees                                                                                     1 120            802
Fee and commission income                                                                                             2 662          2 458
Fee and commission expense                                                                                            (401)          (213)
Net fee and commission income                                                                                         2 261          2 245      
  Annuity fees (net of fees payable)                                                                                  1 616          1 616
  Deal fees                                                                                                             645            629

All revenue generated from fee and commission income arises from contracts with customers.


Analysis of financial assets and liabilities by measurement category
                                                                                                 Financial    Non-financial
                                                                                     Total     instruments   instruments or
At 31 March 2019                                                            instruments at    at amortised    scoped out of
R'million                                                                       fair value            cost           IFRS 9          Total

Assets
Cash and balances at central banks                                                       -          10 290                -         10 290
Loans and advances to banks                                                              -          19 903                -         19 903
Non-sovereign and non-bank cash placements                                             610          11 582                -         12 192
Reverse repurchase agreements and cash collateral on
securities borrowed                                                                  9 870           8 682                -         18 552
Sovereign debt securities                                                           55 604           5 289                -         60 893
Bank debt securities                                                                 5 527           6 999                -         12 526
Other debt securities                                                                8 656           4 897                -         13 553
Derivative financial instruments                                                     7 700               -                -          7 700
Securities arising from trading activities                                           5 059               -                -          5 059
Investment portfolio                                                                 7 664               -                -          7 664
Loans and advances to customers                                                     16 008         245 729                -        261 737
Own originated loans and advances to customers securitised                               -           7 667                -          7 667
Other loans and advances                                                                 -             329                -            329
Other securitised assets                                                                 -             232                -            232
Interests in associated undertakings                                                     -               -            6 251          6 251
Deferred taxation assets                                                                 -               -            1 514          1 514
Other assets                                                                           440           4 326            3 471          8 237
Property and equipment                                                                   -               -            2 563          2 563
Investment properties                                                                    -               -                1              1
Goodwill                                                                                 -               -              171            171
Intangible assets                                                                        -               -              418            418
Loans to group companies                                                               115          18 036                -         18 151
                                                                                   117 253         343 961           14 389        475 603
Liabilities
Deposits by banks                                                                        -          30 041                -         30 041
Derivative financial instruments                                                    11 097               -                -         11 097
Other trading liabilities                                                            4 468               -                -          4 468
Repurchase agreements and cash collateral on securities lent                         7 742           7 492                -         15 234
Customer accounts (deposits)                                                        44 606         297 104                -        341 710
Debt securities in issue                                                             2 856           3 656                -          6 512
Liabilities arising on securitisation of own originated loans
and advances                                                                             -           1 720                -          1 720
Current taxation liabilities                                                             -               -              542            542
Deferred taxation liabilities                                                            -               -               78             78
Other liabilities                                                                      828           2 193            3 242          6 263
Loans from group companies                                                               -           2 260                -          2 260
                                                                                    71 597         344 466            3 862        419 925
Subordinated liabilities                                                                 -          13 918                -         13 918
                                                                                    71 597         358 384            3 862        433 843


Financial instruments carried at fair value
The table below analyses recurring fair value measurements for financial assets and financial liabilities. These fair value measurements are
categorised into different levels in the fair value hierarchy based on the inputs to the valuation technique used.

The different levels are identified as follows:
Level 1 - quoted (unadjusted) prices in active markets for identical assets or liabilities.
Level 2 - inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly 
          (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3 - inputs for the asset or liability that are not based on observable market data (unobservable inputs).

                                                                                                             Fair value category
                                                                                         Total  
At 31 March 2019                                                                   instruments  
R'million                                                                        at fair value         Level 1        Level 2      Level 3
Assets
Non-sovereign and non-bank cash placements                                                 610               -            610            -
Reverse repurchase agreements and cash collateral on
securities borrowed                                                                      9 870               -          9 870            -
Sovereign debt securities                                                               55 604          55 604              -            -
Bank debt securities                                                                     5 527           2 727          2 800            -
Other debt securities                                                                    8 656           4 186          4 470            -
Derivative financial instruments                                                         7 700               -          7 700            -
Securities arising from trading activities                                               5 059           4 974             85            -
Investment portfolio                                                                     7 664           4 091            354        3 219
Loans and advances to customers                                                         16 008               -         15 341          667
Other assets                                                                               440             440              -            -
Loans to group companies                                                                   115               -            115            -
                                                                                       117 253          72 022         41 345        3 886
Liabilities
Derivative financial instruments                                                        11 097               -         11 097            -
Other trading liabilities                                                                4 468           2 282          2 186            -
Repurchase agreements and cash collateral on securities lent                             7 742               -          7 742            -
Customer accounts (deposits)                                                            44 606               -         44 606            -
Debt securities in issue                                                                 2 856               -          2 856            -
Other liabilities                                                                          828               -            828            -
                                                                                        71 597           2 282         69 315            -
Net financial assets/(liabilities) at fair value                                        45 656          69 740       (27 970)        3 886


Transfers between level 1 and level 2
There were no significant transfers between level 1 and level 2 in the current year.

Level 3 instruments
                                                                                                     Loans and
                                                                                    Investment     advances to  Other level 3
R'million                                                                            portfolio       customers         assets        Total
Balance at 31 March 2018                                                                 1 961               -             22        1 983
Adoption of IFRS 9                                                                       1 108             604           (22)        1 690
Balance at 1 April 2018                                                                  3 069             604              -        3 673
Total losses included in the income statement                                            (758)               -              -        (758)
Purchases                                                                                1 062               -              -        1 062
Sales                                                                                    (370)               -              -        (370)
Settlements                                                                                (4)               -              -          (4)
Transfers into level 3                                                                     220              63              -          283
Balance at 31 March 2019                                                                 3 219             667              -        3 886

During the year R282.9 million of level 2 instruments have been transferred into level 3 as a result of inputs to valuation models becoming
unobservable in the market.

The group transfers between levels within the fair value hierarchy when the significance of the unobservable inputs change or if the
valuation methods change.

The following table quantifies the gains or (losses) included in the income statement recognised on level 3 financial instruments:

For the year to 31 March 2019
R'million                                                                                                Total       Realised   Unrealised
Total gains or (losses) included in the income statement for the year
Investment income                                                                                        (758)             49        (807)
                                                                                                         (758)             49        (807)

Sensitivity of fair values to reasonably possible alternative assumptions by level 3 instrument type
The fair value of financial instruments in level 3 are measured using valuation techniques that incorporate assumptions that are not
evidenced by prices from observable market data. The following table shows the sensitivity of these fair values to reasonably possible
alternative assumptions, determined at a transactional level:


                                                                                                                 Potential impact on the
                                                                                                                     income statement
                                               Level 3                              Significant    Range which
                                               balance                             unobservable   unobservable   Favourable   Unfavourable
                                           sheet value                                    input      input has      changes        changes
At 31 March 2019                             R'million        Valuation method          changed   been changed    R'million      R'million  
Assets                                                                                                                                
Investment portfolio                             3 219                                                                  585          (578)
                                                                Price earnings           EBITDA              *   
                                                                                                                        272          (264)
                                                                    Discounted     Precious and       (10%)/6%
                                                                     cash flow       industrial
                                                                                  metals prices                          41           (41)
                                                               Discounted cash       Cash flows      (50%)/50%
                                                                          flow                                          167          (167)
                                                                         Other          Various             **           90           (82)
                                                      
                                                               Net asset value       Underlying              ^
                                                                                    asset value                          15           (24)
Loans and advances to customers                    667                                                                  308          (308)
                                                               Discounted cash       Cash flows      (50%)/50%
                                                                          flow                                          302          (302)
                                                                Price earnings           EBITDA              *            6            (6)

Total                                            3 886                                                                  893          (886)



*  The EBITDA and cash flows have been stressed on an investment-by-investment basis in order to obtain favourable and unfavourable valuations.
** The valuation sensitivity for the certain equity investments has been assessed by adjusting various inputs such as expected cash flows, 
   discount rates and earnings multiples rather than a single input. It is deemed appropriate to reflect the outcome on a portfolio basis 
   for the purposes of this analysis as the sensitivity of the investments cannot be determined through the adjustment of a single input.
^  Underlying asset values are calculated by reference to a tangible asset.

In determining the value of level 3 financial instruments, the following are the principal inputs that can require judgement:

Price-earnings multiple
The price earnings ratio is an equity valuation multiple. It is a key driver in the valuation of unlisted investments.

EBITDA
The company's earnings before interest, taxes, depreciation and amortisation. This is the main input into a price earnings multiple
valuation method.

Precious and industrial metals
The price of property and precious and industrial metals is a key driver of future cash flows on these investments.

Cash flows
Cash flows relate to the future cash flows which can be expected from the instrument and requires judgement

Underlying asset value
In instances where cash flows have links to referenced assets, the underlying asset value is used to determine the fair value.
The underlying asset valuation is derived using observable market prices sourced from broker quotes, specialist valuers or other reliable
pricing sources.

Measurement of financial assets and liabilities at level 2
The table below sets out information about the valuation techniques used at the end of the reporting period in measuring financial
instruments categorised as level 2 in the fair value hierarchy:
                                                                              Valuation basis/techniques         Main inputs
Assets
Non-sovereign and non-bank cash placements                                    Discounted cash flow model         Yield curve
Reverse repurchase agreements and cash collateral on securities borrowed      Discounted cash flow model         Yield curve
Bank debt securities                                                          Discounted cash flow model         Yield curve
Other debt securities                                                         Discounted cash flow model         Yield curve
Derivative financial instruments                                              Discounted cash flow model         Yield curve
                                                                              Black-Scholes                      Volatilities
Securities arising from trading activities                                    Discounted cash flow model         Yield curve
Investment portfolio                                                          Adjusted quoted price              Liquidity adjustment
Loans and advances to customers                                               Discounted cash flow model         Yield curve
Loans to group companies                                                      Discounted cash flow model         Yield curve
Liabilities
Derivative financial instruments                                              Discounted cash flow model         Yield curve
                                                                              Black-Scholes                      Volatilities
Other trading liabilities                                                     Discounted cash flow model         Yield curve
Repurchase agreements and cash collateral on securities lent                  Discounted cash flow model         Yield curve
Customer accounts (deposits)                                                  Discounted cash flow model         Yield curve
Debt securities in issue                                                      Discounted cash flow model         Yield curve
Other liabilities                                                             Discounted cash flow model         Yield curve


Fair value of financial assets and liabilities at amortised cost
The following table sets out the fair value of financial instruments held at amortised cost where the carrying value is not a reasonable
approximation of fair value:

At 31 March 2019                                                                                                  Carrying
R'million                                                                                                           amount      Fair value
Assets
Reverse repurchase agreements and cash collateral on securities borrowed                                             8 682           8 684
Sovereign debt securities                                                                                            5 289           5 097
Bank debt securities                                                                                                 6 999           6 992
Other debt securities                                                                                                4 897           4 871
Loans and advances to customers                                                                                    245 729         245 739
Liabilities 
Deposits by banks                                                                                                   30 041          30 544
Repurchase agreements and cash collateral on securities lent                                                         7 492           7 447
Customer accounts (deposits)                                                                                       297 104         297 692
Debt securities in issue                                                                                             3 656           3 677
Subordinated liabilities                                                                                            13 918          15 496

Investec Bank Limited
Incorporated in the Republic of South Africa
Registration number: 1969/004763/06
Share code: INLP
ISIN: ZAE000048393

Preference share dividend announcement

Non-redeemable non-cumulative non-participating
preference shares ("preference shares")

Declaration of dividend number 32
Notice is hereby given that preference dividend number 32 has
been declared by the Board from income reserves for the
period 01 October 2018 to 31 March 2019 amounting to a gross
preference dividend of 422.87121 cents per preference share
payable to holders of the non-redeemable non-cumulative
non-participating preference shares as recorded in the books of
the company at the close of business on Friday, 07 June 2019.

The relevant dates for the payment of dividend number
32 are as follows:

Last day to trade cum-dividend               Tuesday, 04 June 2019
Shares commence trading ex-dividend        Wednesday, 05 June 2019
Record date                                   Friday, 07 June 2019
Payment date                                 Tuesday, 18 June 2019

Share certificates may not be dematerialised or rematerialised
between Wednesday, 05 June 2019 and Friday, 07 June 2019,
both dates inclusive.

Additional information to take note of:
- Investec Bank Limited tax reference number: 9675/053/71/5

- The issued preference share capital of Investec Bank Limited is
  15 447 630 preference shares

- The dividend paid by Investec Bank Limited is subject to South
  African Dividend Tax (Dividend Tax) of 20% (subject to any
  available exemptions as legislated)

- The net dividend amounts to 338.29697 cents per preference
  share for shareholders liable to pay the Dividend Tax and
  422.87121 cents per preference share for preference
  shareholders exempt from paying the Dividend Tax.


By order of the board

N van Wyk
Company Secretary

15 May 2019

Investec Bank Limited
(Registration number 1969/004763/06)
Share code: INLP SIN: ZAE000048393

Registered office
100 Grayston Drive
Sandown, Sandton, 2196

Transfer secretaries
Computershare Investor Services (Pty) Ltd
Rosebank Towers, 15 Biermann Avenue, Rosebank, 2196

Company Secretary
N van Wyk

Sponsor:
Investec Bank Limited

Directors
KL Shuenyane (Chairman)
DM Lawrence (Deputy Chairman)
RJ Wainwright^ (Chief Executive Officer)
SC Spencer (Finance Director)^
ZBM Bassa, D Friedland, PA Hourquebie
PRS Thomas, F Titi^

^Executive
B Tapnack resigned effective 15 May 2018
KL Shuenyane was appointed as chairman on 15 May 2018
F Titi was appointed as an executive director on 15 May 2018
(previously non-executive chairman)
SE Abrahams retired effective 8 August 2018
GR Burger retired effective 12 December 2018
PA Hourquebie was appointed as an non-executive director on
12 December 2018
S Koseff resigned effective 30 January 2019
B Kantor resigned effective 30 January 2019
NA Samujh resigned effective 14 May 2019
SC Spencer was appointed on 14 May 2019



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