Nedbank remains profitable despite impairments amid Covid-19 fallout

Stronger growth in trading income helped offset these impacts as Covid-19 restrictions were eased.

Nedbank Group said in a statement that it remains profitable with strong capital and liquidity ratios, despite adjusted earnings per share in the six months through June expected to fall as much as 72 percent on sharply higher impairments amid the fallout from Covid-19. 

The company’s credit-loss ratio deteriorated to 1.9 percent above the 1.5 percent level it reached during the global financial crisis, and compared with 0.8 percent at the end of 2019. It also made a R750 million impairment against the carrying value of its investment in pan-African lender Ecobank Transnational

“However, stronger growth in trading income helped offset some of these impacts and transactional activity improved as the government eased some of the restrictions to contain the spread of Covid-19,” the statement read. 

At the end of June it had also restructured loans for more than 375,000 customers, amounting to R119 billion.