Nedbank reported largely flat headline earnings for the six months ended June 30 despite stronger revenue growth and disciplined cost management, as higher credit impairments weighed on performance.
The banking group’s headline earnings edged up 0.1% to R8.405-billion from R8.399-billion a year ago, while revenue increased 6% to R38.2-billion. Headline earnings per share rose 2% to R18.41, and diluted headline earnings per share increased 2% to R18.03.
The group declared an interim dividend of R10.52 per share, up from R10.28 in the corresponding period last year.
Results exceeded expectations
Chief executive Jason Quinn said the results exceeded management’s expectations at the start of the year, supported by improving net interest income, strong non-interest revenue growth and strict expense control.
“Headline earnings for the six months to 30 June 2026 were flat year-on-year at R8.4 billion, outperforming our expectations at the start of the year,” Quinn said.
He noted that earnings growth was affected by a higher impairment charge and the absence of associate income from Ecobank Transnational Incorporated following the disposal of Nedbank’s investment in the pan-African banking group in 2025. Excluding that impact, headline earnings growth would have been about 12%.
The bank’s credit loss ratio increased to 95 basis points from 81 basis points a year earlier, while operating expenses rose 3% to R21.7 billion. However, the cost-to-income ratio improved to 56.2% from 56.9%.
Return on equity remained resilient at 15%, slightly down from 15.2% in the prior period but still above the group’s estimated cost of equity of 14%.
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Nedbank said strategic initiatives launched in 2025 were beginning to deliver benefits across its business divisions. Corporate and Investment Banking recorded improved growth momentum, while Business and Commercial Banking benefited from acquisitions, including iKhokha and Eqstra. Personal and private banking continued to gain market share in advances and deposits and achieved strong growth in insurance and payments.
Progress in acquiring Kenya-based NCBA Group
The lender also highlighted progress on its planned acquisition of a controlling stake in Kenya-based NCBA Group. The offer closed on July 10 and was accepted by shareholders representing 79.9% of NCBA shares in issue, enabling Nedbank to secure its targeted 66% shareholding. The lender expects to receive the remaining regulatory approvals by the late third quarter or early fourth quarter of 2026.
Digitisation remained a key growth driver, with increased use of digital banking channels and expanding applications of artificial intelligence across revenue generation, credit management, customer experience and fraud prevention.
Total clients increased 4% to eight million, while the value of the Nedbank brand rose 16% to R24 billion. Sustainable development finance reached R213 billion, accounting for 21% of total gross loans.
Looking ahead, Nedbank expects South Africa’s economy to grow by around 1.3% in 2026 and 1.4% in 2027. The bank said underlying growth momentum across its businesses should support stronger earnings growth in the second half of the year, with return on equity expected to remain above 15%.
“We remain focused on delivering a return on equity of around 17% in 2028, underpinned by stronger revenue growth and continued operational efficiency gains,” Quinn said.
- Nedbank’s headline earnings for H1 2026 were flat at R8.4 billion despite 6% revenue growth and disciplined cost control, impacted by higher credit impairments and the disposal of its Ecobank stake.
- Headline earnings per share increased by 2%, and the interim dividend rose to R10.52 per share, with the cost-to-income ratio improving slightly to 56.2%.
- Strategic initiatives and acquisitions boosted growth in Corporate and Investment Banking, Business and Commercial Banking, and Personal and Private Banking divisions.
- Nedbank secured 79.9% acceptance from NCBA shareholders for its planned 66% stake acquisition, awaiting final regulatory approvals expected by late Q3 or early Q4 2026.
- The bank remains optimistic about underlying business growth, aiming for a return on equity around 17% by 2028, supported by digital banking expansion and sustainable finance initiatives.
Chief executive Jason Quinn said the results exceeded management's expectations at the start of the year, supported by improving net interest income, strong non-interest revenue growth and strict expense control.
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He noted that earnings growth was affected by a higher impairment charge and the absence of associate income from
Return on equity remained resilient at 15%, slightly down from 15.2% in the prior period but still above the group's estimated cost of equity of 14%.
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Digitisation remained a key growth driver, with increased use of digital banking channels and expanding applications of artificial intelligence across revenue generation, credit management, customer experience and fraud prevention.
Total clients increased 4% to eight million, while the value of the
"We remain focused on delivering a return on equity of around 17% in 2028, underpinned by stronger revenue growth and continued operational efficiency gains," Quinn said.
