Nedbank yesterday brushed aside worries about sluggish economic growth and maintained it would achieve its medium- to long-term earnings-per-share target growth for this year.
The Old Mutual-owned banking group told shareholders it would achieve its diluted headline earnings target calculated as greater or equal to South Africa's gross domestic product plus consumer price index plus 5%.
Analysts expect Nedbank's full-year earnings to grow by as much as 22% this year, compared with single-digit growth at Absa, the largest retail banking group by customer numbers.
Nedbank CEO Mike Brown said the group had revised its GDP growth forecast to 2.5%, while interest rates were expected to be cut further to stimulate sluggish growth in the face of domestic and global economic weakness.
"Given the prevailing economic slowdown and uncertainty, combined with the effects of strike action, the group remains cautious on its outlook," said Brown.
"However, the strength of the Nedbank franchise, together with the momentum built in the first nine months of the year, allows the group to reaffirm its previous financial guidance to achieve its medium- to long-term diluted headline-earning-per-share growth target," he said.
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