Investec sees flat profits as deposits slip despite Ashes affect

1st Aug 2013 07:01

South African investment bank Investec saw customer accounts and assets under management dip in the first quarter, leading to flat profits. In a brief quarterly update, the London- and Johannesburg-listed group said it had generated operating profits in line with the prior year, or up 11% when currencies effects are neutralised, from a 4.0% rise in total operating income joined by a 4.0% increase in operating costs.Both the South African rand and the Australian dollar weakened against the pound during the period, although the euro and US dollar strengthened. However, Investec, despite the added publicity of sponsoring the Ashes cricket series between England and Australia, saw third-party assets under management and customer accounts both slip 4.0% as bad debts were hit for a 6.0% increase.But the FTSE 250 group did see a net inflow of £0.9bn as assets under management collapsed from £110.7bn to £105.8bn.Customer deposits reduced by 4.0% to £23.5bn, although this was an increase of 1.0% on a currency neutral basis.Its capital adequacy ratios for its UK Plc were up from 11% to 16.8% and from 10.8% to 14.8% for the South African Limited business.The amount of core loans and advances Investec made fell by 4.0% to £17.7bn, but recorded an increase of 2.0% on a currency neutral basis.Investec had plenty of cash in the coffers, with close to £9.3bn of cash and near cash available to support its activities in its South African, UK and Australian markets. OH