FirstRand Limited

FirstRand reported normalized earnings growth of 11% for the 6 months ended 31 December 2025, with NIACC up 26% and NAV up 7% (or up 10% excluding foreign currency translation). NII rose 8%, NIR rose 12%, impairments were up 6% with a CLR of 86 basis points, and operating expenses increased 9%; legal and specialist costs tied to the UK FCA motor redress process were ZAR 333 million pretax and ZAR 244 million post-tax, reducing earnings growth by 1%. The group’s CET1 ratio was 14.4%, group margins were up 8 basis points overall and 15 basis points excluding the UK, and the cost-to-income ratio was anchored below 49%. Management reaffirmed full-year guidance for mid-teens earnings growth assuming no additional UK provision adjustment, and said it expects high single-digit NII growth, a strong NIR trajectory and improving credit outcomes.

Mary Vilakazi framed the period as evidence that FirstRand’s franchise mix and risk/financial-resource-management strategy are working, even in a mixed macro backdrop. She highlighted improving South African conditions, stronger business confidence, and better operating momentum across the group’s domestic franchises, broader Africa, and parts of the UK business. Her tone was confident and constructive, but she repeatedly noted lingering uncertainty around the FCA redress scheme and geopolitical risk.

Markos Davias said the quarter’s 11% normalized earnings growth was driven by NII up 8% and NIR up 12%, while impairments normalized to 86 basis points after prior-period UK one-offs. He pointed to a 14.4% CET1 ratio, provision stock of ZAR 56 billion, performing coverage of 1.43%, and a cost-to-income ratio below 49% as signs of strong capital and expense control. He also quantified UK-related legal and specialist costs at ZAR 333 million pretax and ZAR 244 million post-tax, and said the group can absorb possible negative outcomes from the FCA process if needed.

Analysts pressed management on the sustainability of FNB customer gains, private equity realizations, the strength of global markets income, capital deployment, and the UK motor commission timeline. Management said FNB growth was helped by branch and AgencyPlus expansion, that private equity is actively managed with continuous investments and realizations, and that global markets was more of a bounce-back plus deliberate client coverage strategy than a one-off. On the UK issue, management said the FCA plans to publish the final redress scheme by end-March and FirstRand will then assess its response; they said current capital should cover expected scenarios and dividend capacity should remain intact in the meantime.