FirstRand Limited

FirstRand reported 6-month normalized earnings growth of 11%, NIACC growth of 26%, and NAV growth of 7% (or 10% excluding foreign currency translation). NII increased 8%, NIR increased 12%, credit impairments rose 6% with a CLR of 86 basis points, and operating expenses rose 9%; the group also cited legal and specialist costs of ZAR 333 million pretax and ZAR 244 million post-tax related to the U.K. FCA motor redress process, which affected earnings growth by 1%. The group’s CET1 ratio was 14.4%, and the cost-to-income ratio was anchored below 49%. Looking ahead, management reaffirmed full-year guidance for high single-digit NII growth, a strong NIR trajectory, and an improving credit outcome, with positive jaws; they also said full-year earnings growth should be up mid-teens assuming no additional U.K. provision adjustment.

Mary Vilakazi framed the period as evidence that FirstRand’s franchises are performing well despite a tough macro backdrop, pointing to South African reform progress, improving business confidence, and signs of a broader credit and investment cycle. She emphasized that the group’s strength comes from diversified earnings streams, disciplined FRM, and a focus on growing transactional franchises, deposits, and capital-light income. Her tone was confident but measured, especially on the U.K. FCA issue, where she stressed there is still uncertainty until the final redress scheme is published.

Markos Davias highlighted the hard numbers behind the half-year: 11% normalized earnings growth, 26% NIACC growth, NII up 8%, NIR up 12%, impairments up 6% at an 86 basis point CLR, and costs up 9%. He broke out the U.K. FCA-related legal and specialist costs of ZAR 333 million pretax and ZAR 244 million post-tax, and noted CET1 of 14.4% gives the group capacity to absorb possible adverse outcomes. He also pointed to margin expansion of 15 basis points excluding the U.K., a provision stock of ZAR 56 billion, and performing coverage of 1.43% as signs of balance-sheet resilience.

Analysts pressed management on the sustainability of earnings growth, the recurring nature of private equity realizations and RMB global markets strength, the U.K. motor commission exposure, capital deployment, and whether FNB customer gains can continue. Management said earnings growth is sustainable because of franchise diversification and a better operating environment, while private equity is managed with active portfolio turnover and global markets is viewed as a bounce-back but now on stronger foundations. On the U.K., they said the FCA is expected to publish the final redress scheme by end-March and that existing capital should cover expected scenarios; on capital, they said they are not holding excess capital for a large acquisition, but are waiting for clearer U.K. visibility before deciding how to deploy it.