| |
| Continue strategy
of building our
franchise.evolving
business model |
| • |
Broadly defined, we operate
in two distinct spaces,
specialist banking and asset
management |
| • |
We live in a world where the
market requires a high degree
of transparency and the
appropriate management of
conflicts of interest |
| • |
Within specialist banking, we
offer a broad range of services
from advisory, structuring,
lending, securities trading,
market making and principal
transactions. These services
are aimed at government,
institutional, corporates and
high net worth clients in our
selected geographies |
| • |
We are in the process of
creating a global wealth unit to
serve the investment needs of
high net worth clients directly
or through our Private Banking
network |
| • |
Operating completely
independently from these
structures is Investec Asset
Management |
| • |
Its sole focus is the provision
of investment management
services to its predominantly
global institutional client base |
|
| |
Business model (balancing operational risk businesses with financial risk businesses) |
 |
| |
| Continue strategy of building our franchise.
balance operational risk businesses with
financial risk businesses |
| |
 |
| |
 |
| |
| • |
We seek to maintain an appropriate balance between revenue earned from operational
risk businesses and revenue earned from financial risk businesses |
| • |
This ensures that we are not over reliant on any one part of our business to sustain our
activities and that we have a large recurring revenue base that enables us to navigate
through varying cycles and to support our long-term growth objectives |
| • |
Our current strategic objectives include increasing the proportion of our non-lending
revenue base which we largely intend to achieve through the continued strengthening
and development of our wealth and asset management businesses. |
|
| |
| Continue strategy of building our franchise.
maintain operational efficiency |
| |
Efficiency ratio |
 |
| |
| • |
Cost to income ratio is 57.8%
(well below our internal target
of <65%) |
| • |
Total expenses grew by 14.9%
to £957.2 million as a result of: |
| |
– |
The appreciation of the
Rand |
| |
– |
An increase in variable
remuneration in certain
divisions given improved
profitability |
| • |
Total headcount continues to
be tightly managed across the
group |
| • |
A non-cash deferred
component has been
introduced to variable
remuneration payments |
|
| |
| Continue strategy
of building our
franchise...
maintain quality of
balance sheet |
| • |
Continue to diversify funding
sources and reduce reliance
on wholesale funding |
| • |
Manage risk and maintain
credit quality |
|
| |
Leverage ratios |
| |
31 March
2010 |
31 March
2009 |
| Core loans to equity ratio |
5.4x |
6.2x |
| Core loans (excluding own originated assets which have been securitised) to customer deposits |
76.2% |
103.6% |
| Total gearing (assets excluding assurance assets to total equity) |
12.5x |
13.0x |
| Total gearing (excluding assurance and securitised assets) |
11.7x |
11.7x |
|
| |
Outlook |
| • |
We have built our capital, liquidity and third party assets under
management over the period under review |
| • |
The foundation is now in place for further growth both in our
non-capital intensive asset management businesses as well as
our core specialist banking businesses |
| • |
Although the economic situation remains uncertain the business is
oriented towards capturing available opportunities in all our
core geographies. |
|
/ Overview of the year / Strategic focus