Investec PLC Quarterly Capital Disclosure (4565M)

TIDMINVP

RNS Number : 4565M

Investec PLC

28 July 2017

 
 Investec Limited                      Investec plc 
  Incorporated in the Republic          Incorporated in England 
  of South Africa                       and Wales 
  Registration number 1925/002833/06    Registration number 
  JSE share code: INL                   3633621 
  NSX share code: IVD                   LSE share code: 
  BSE share code: INVESTEC              INVP 
  ISIN: ZAE000081949                    JSE share code: INP 
                                        ISIN: GB00B17BBQ50 
 

Investec (comprising Investec plc and Investec Limited) - Basel III disclosures at 30 June 2017

28 July 2017

Capital disclosures

The disclosures below are made with respect to Basel III quarterly disclosure requirements. The group holds capital in excess of regulatory requirements targeting a minimum common equity tier one capital ratio above 10% and a total capital adequacy ratio range of 14% to 17% on a consolidated basis for each of Investec plc and Investec Limited.

 
                                  Investec                      Investec 
                                    plc*^         IBP*^          Limited*        IBL* 
                                    GBP            GBP 
 As at 30 June 2017                  'mn            'mn           R'mn           R'mn 
-----------------------------  -------------  -------------  --------------  ----------- 
 
 Common equity tier 
  1 capital                            1,557          1,575          33,583       34,465 
                               -------------  -------------  --------------  ----------- 
 
 Additional tier 1 
  capital                                 24              -           2,911          767 
 
 Tier 1 capital                        1,581          1,575          36,494       35,232 
                               -------------  -------------  --------------  ----------- 
 
 Tier 2 capital                          468            531          12,402       15,407 
 
 Total regulatory capital              2,049          2,106          48,896       50,639 
                               -------------  -------------  --------------  ----------- 
 
 Risk-weighted assets 
  per risk type: 
 Credit risk                           9,959          9,725         249,934      246,032 
 Counterparty credit 
  risk                                   541            549           5,484        5,548 
 Credit valuation adjustment 
  risk                                    74             75           1,632        1,632 
 Equity risk                              79             80          47,851       46,045 
 Market Risk                           1,063          1,033           4,681        4,291 
 Operational risk                      2,087          1,656          30,486       20,499 
 Total risk-weighted 
  assets                              13,803         13,118         340,068      324,047 
                               -------------  -------------  --------------  ----------- 
 
 Total minimum capital 
  requirement                          1,104          1,049          36,557       34,835 
 
 Capital ratios 
 Common equity tier 
  1 ratio                              11.3%          12.0%            9.9%        10.6% 
 Tier 1 ratio                          11.5%          12.0%           10.7%        10.9% 
 Total capital ratio                   14.8%          16.1%           14.4%        15.6% 
 

Leverage ratio disclosures

 
                       Investec              Investec 
                         plc*^    IBP*^      Limited*       IBL* 
                         GBP       GBP 
 As at 30 June 2017       'mn       'mn        R'mn         R'mn 
--------------------  ---------  -------  -------------  --------- 
 
 Tier 1 capital           1,581    1,575         36,494     35,232 
 Total exposure          20,242   20,053        471,559    445,879 
 Leverage ratio            7.8%     7.9%           7.7%       7.9% 
 

* Where: IBP is Investec Bank plc consolidated and IBL is Investec Bank Limited consolidated. The information for Investec plc includes the information for IBP. The information for Investec Limited includes the information for IBL.

^ The capital adequacy disclosures follow Investec's normal basis of presentation so as to show a consistent basis of calculation across the jurisdictions in which the group operates. For Investec plc and IBP this does not include the deduction of foreseeable dividends when calculating CET1 capital as required under the Capital Requirements Regulation and EBA technical standards and in line with Investec's normal basis of presentation includes unaudited profits for the current quarter.

Investec Limited's and IBL's capital information includes unappropriated profits. If unappropriated profits are excluded from capital information, all Investec Limited's capital ratios would be 46bps lower and IBL's capital ratios would be 20 bps lower.

Liquidity coverage ratio disclosure

The objective of the liquidity coverage ratio (LCR) is to promote the short-term resilience of the liquidity risk profile of banks by ensuring that they have sufficient high quality liquid assets to survive a significant stress scenario lasting 30 calendar days.

Investec Bank Limited (solo basis) and Investec Bank Limited Consolidated Group

The minimum LCR requirement in South Africa is 80% for 2017, increasing by 10% each year to 100% on 1 January 2019.

In accordance with the provisions of section 6(6) of the South African Banks Act 1990 (Act No. 94 of 1990), banks are directed to comply with the relevant LCR disclosure requirements, as set out in Directive 6/2014 and Directive 11/2014. This disclosure is in accordance with Pillar 3 of the Basel III liquidity accord.

The following table sets out the LCR for Investec Bank Limited (solo basis) and Investec Bank Consolidated Group as at 30 June 2017:

 
                        Investec Bank       Investec Bank Limited 
                         Limited Solo        Consolidated Group 
                         - Total weighted    - Total weighted 
 R'mn                    value               value 
---------------------  ------------------  ---------------------- 
 High quality liquid 
  assets (HQLA)                    69,025                  69,101 
---------------------  ------------------  ---------------------- 
 Net cash outflows                 52,969                  47,833 
---------------------  ------------------  ---------------------- 
 Actual LCR (%)                    130.4%                  127.4% 
=====================  ==================  ====================== 
 Required LCR (%)                     80%                     80% 
---------------------  ------------------  ---------------------- 
 

The values in the table are calculated as the simple average of daily observations over the period 1 April 2017 to 30 June 2017 for Investec Bank Limited (IBL) bank solo. 61 business day observations were used. Investec Bank Limited consolidated group values use daily values for IBL bank solo, while those for other group entities use the average of April, May, June 2017 month-end values.

Investec plc, Investec Bank plc (solo basis)

On 1 October 2015 under European Commission Delegated Regulation 2015/61, the LCR became the PRA's primary regulatory reporting standard for liquidity. The LCR is a Pillar 1 metric to which the PRA apply Pillar 2 add-ons. The LCR is being introduced on a phased basis, and the PRA has opted to impose higher liquidity coverage requirements during the phased-in period than the minimum required by CRD IV. From 1 January 2017, UK banks are required to maintain a minimum of 90%, rising to 100% on 1 January 2018. The published LCR excludes Pillar 2 add-ons.

For Investec plc and Investec Bank plc (solo basis), the LCR is calculated using our own interpretations of the EU Delegated Act. The reported LCR may change over time with regulatory developments.

The LCR reported to the PRA at 30 June 2017 was 613% for Investec plc and 525% for Investec Bank plc (solo basis).

Johannesburg and London

28 July 2017

Sponsor:

Investec Bank Limited

This information is provided by RNS

The company news service from the London Stock Exchange

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July 28, 2017 08:00 ET (12:00 GMT)