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MEDIA RELEASE
14 SEPTEMBER 2023
RMB continues to support clients in their sustainability and transition journey
Rand Merchant Bank (RMB), the corporate and investment banking arm of FirstRand Limited, delivered a solid performance in the FY23 year. Normalised profit before tax (PBT) was up by 9% with a return on equity of 21.2%. The broader Africa business reported excellent growth, representing an impressive 31% of RMB’s overall PBT.
Sustainability and transition finance remain a key focus for clients. RMB executed 35 transactions and facilitated R36.3bn in sustainable finance in the past financial year. This is in line with our ambition to facilitate R200bn in sustainable finance by 2026.
One of the transactions included RMB reaching financial closure on South Africa’s first utility-scale private wheeled wind energy project, contracted to supply renewable energy over 20 years to Sasol South Africa’s green hydrogen production pilot at its Sasolburg operations. The bank is also growing its social focus with a loan that helps Respublica deliver affordable student accommodation.
“As a financial services provider we have the skills and resources to partner our clients in finding innovative solutions which have a meaningful impact on our societies to thrive,” says RMB CEO Emrie Brown.
Robust business performance
Investment banking delivered PBT growth of 12%, a strong performance off a high base, underpinned by strong new business origination with core advances growth of 21% supporting NII growth and solid fee income momentum.
Corporate transactional banking had an excellent performance and grew PBT by 26% with average deposit growth of 10%. The business continued to acquire primary-banked clients in a highly competitive environment.
The Markets division’s overall topline performance remained resilient, although overall PBT was impacted by elevated investment costs into geographical expansion and diversification strategies and lower client volumes and spread compression in South Africa.
For Ashburton, the business benefited from strong inflows, with assets under management growing by 20%.
Private Equity had excellent results, benefiting from a significant realisation with the sale of Studio 88, as well as strong annuity income growth.
The broader Africa portfolio had an excellent performance and grew PBT by 55%. Net interest income growth of 49% was driven by strong advances growth, as well as ongoing new client acquisitions which supported average deposit growth, and the elevated rate cycle.
RMB continues to invest in the modernisation of core platforms, enhanced digital offerings to clients, and expansion of activities in international jurisdictions.
Says Brown: “As part of our broader Africa strategy, and in addition to our specialised offerings in the UK and India, we are excited about the establishment of a presence in the USA through a broker-dealer business and representative office to expand our offering to our clients. Our presence outside of Africa allows us to facilitate capital flows and investment between the continent and international capital markets, whilst increasing our proximity to multinational clients that have traditional banking requirements in our various presence markets.”
End
Contact:
Joandra Griesel l RMB l joandra.griesel@rmb.co.za
FirstRand Limited results for the year ended 30 June 2023:
