Nedbank says it has completed its major restructuring plan for the organisation, but the South African banking group warned that its performance for 2025 will likely remain weak. The update came in its pre-close statement for the 2025 financial year, where it confirmed that the restructuring which was first announced in March has now been concluded. The bank said the move was aimed at improving competitiveness and deepening customer relationships in the fast-changing financial services sector.
Under the new structure, Nedbank divided its businesses into new segments. The Retail and Business Banking division and Nedbank Wealth were broken into Personal and Private Banking, Business and Commercial Banking, and Corporate Investment Banking. The bank also expanded these clusters by including Nedbank Insurance and Nedbank Wealth Management under Retail and Business Banking. The group said this structural shift is part of its strategy to strengthen its client-centric model and improve cross-selling to customers. It added that the new system would help align services and make the bank more efficient in delivering financial solutions.
Nedbank confirmed that its R1.65 billion purchase of fintech firm iKhokha, The bank believes the acquisition will advance digital payments and help it diversify its revenue base. However, the proposed sale of its stake in Togo-based Ecobank Transnational Incorporated to Bosquet is still awaiting approval in all required jurisdictions. The group said it remains confident that regulatory clearance will be granted.
Nedbank noted that South Africa’s business environment during the second half of the year was still difficult. It mentioned slow economic growth, geopolitical tensions, and the effect of US tariffs on trade flows. The bank added that these factors have resulted in weak investment, slower business spending, and low customer confidence. It said many companies delayed capital projects as they monitored movements in inflation, power supply and global politics.
Despite these challenges, Nedbank mentioned some positive signals for 2025. It pointed to declining inflation, which has allowed the central bank to cut interest rates. The group said this may help household credit conditions improve and support stronger consumer lending. It also highlighted progress in governance and reforms in South Africa. The country was removed from the Financial Action Task Force grey list in 2025, following improvements in compliance supervision. Other improvements include stronger fiscal discipline and an upgraded credit rating from rating agency S&P.
While sharing its performance figures for the first 10 months of 2025, Nedbank said earnings growth was in line with expectations. The result was driven by stronger net interest income, non-interest revenue and lower impairment charges. The bank explained that its cost base was well controlled, which also supported performance. However, these projections did not include the R600 million settlement reached recently between the bank and Transnet.
Net interest income grew at a low to mid-single-digit rate in the first 10 months of 2025, slightly higher than the two percent growth reported in the first half of the year. The group also said its impairments continued to fall and were better than projected. Nedbank noted that its annualised credit loss ratio improved and is now below the middle point of its target range of 60 to 100 basis points. It added that the ratios for Corporate Investment Banking and Business Commercial Banking were below their target ranges, while Personal and Private Banking improved and stayed within the upper half of its range.
Nedbank expects this credit loss ratio level to remain below the midpoint for the full 2025 financial year. Non-interest revenue grew at below mid-single-digit levels compared to the same period last year, supported by insurance and stronger trading operations. The bank said that if the one-off Transnet settlement is excluded, its diluted headline earnings per share growth will be flat to low single digits. Nedbank said it is also on track to deliver a return on equity of 15 percent or more for 2025.
For the year, Nedbank carried out a share buyback programme, purchasing shares worth R2.4 billion. The bank said the average purchase price of R229.53 was below the book value of R245.22, meaning it bought back its stock at a discount. Analysts say the move signals confidence in the bank’s valuation. As South Africa’s economy seeks recovery, Nedbank’s restructuring and acquisitions suggest it is positioning for long-term growth despite short-term weakness.
