Brexit doubts cut into Investec's UK banking business

News24
20 Sep 2019, 22:14 GMT+10

Investec [JSE:INL] has warned of a fall in profits for the first six months of the year, citing challenging market conditions and an ongoing restructuring.

The financial services provider put out a trading update on Friday in anticipation of its upcoming half year earnings report. Its shares were down 4.5% in early trade on the JSE.

It said a fall in revenue and costs meant that adjusted earnings per share would fall by between 4% and 7%.

The company, which is dual listed on the Johannesburg and London stock exchanges, said that "uncertainty relating to Brexit and global trade wars" had negatively impacted its UK specialist banking business

"Interest income has been impacted by the additional liquidity required to pre-fund the exit of Irish deposits as a result of Brexit."

Its SA specialist banking business, on the other hand, was expected to report a profit, despite "weak economic growth and low business confidence."

Investec said the proposed spinoff and separate listing of Investec Asset Management was on track after approval was obtained in August. It intends to list the asset management businesses in London with a secondary inward listing on the JSE.

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