Investec Limited Capital Disclosure

RNS Number : 1834A
Investec PLC
31 January 2022
 

Investec Limited
Incorporated in the Republic of South Africa
Registration number 1925/002833/06
JSE share code: INL

NSX share code: IVD

BSE share code: INVESTEC

ISIN: ZAE000081949

LEI: 213800CU7SM6O4UWOZ70

Investec plc
Incorporated in England and Wales
Registration number 3633621
LSE share code: INVP

JSE share code: INP
ISIN: GB00B17BBQ50

LEI: 2138007Z3U5GWDN3MY22

 

As part of the dual listed company structure, Investec plc and Investec Limited notify both the London Stock Exchange and the JSE Limited of matters which are required to be disclosed under the Disclosure Guidance, Transparency Rules (DTR) and Listing Rules of the United Kingdom Listing Authority (the "UKLA") and/or the JSE Listing Requirements.

 

Accordingly, we advise of the following:

 

Investec Limited - Basel III disclosures at 31 December 2021

 

Capital disclosures

Investec Limited calculates capital resources and requirements at a group level using the Basel III framework, as implemented in South Africa by the South African Prudential Authority, in accordance with the Bank's Act and all related regulations. Investec Limited continues to hold capital in excess of regulatory requirements and board-approved minimum targets .  

 


Including unappropriated profits


Investec Limited*

IBL*

As at 31 December 2021

R'mn

R'mn




Common equity tier 1 capital

  45,576

  45,560




Additional tier 1 capital

  3,381

  2,613




Tier 1 capital

  48,957

  48,173




Tier 2 capital

  8,261

  11,164




Total regulatory capital

  57,218

  59,337




Risk-weighted assets per risk type:



Credit risk

  243,872

 241,652

Counterparty credit risk

  8,537

  8,643

Credit valuation adjustment risk

  3,837

  3,900

Equity risk

24,822 

  10,516

Market Risk

3,819

3,128

Operational risk

  27,172

  22,855

Total risk-weighted assets

  312,059

 290,694




Total minimum capital requirement

  34,326

  31,976




Capital ratios



Common equity tier 1 ratio

14.6%

15.7%

Tier 1 ratio

15.7%

16.6%

Total capital adequacy ratio

18.3%

20.4%

 

 

 

 

 

 

 

 

Leverage ratio disclosures


Including unappropriated profits


Investec Limited*

IBL*

As at 31 December 2021

R'mn

R'mn

Tier 1 capital

48,957

48,173

Total exposure

  623,591

 589,748

Leverage ratio

7.9%

8.2%

 

 

 

 


Excluding unappropriated profits


Investec Limited*

IBL*

As at 31 December 2021

R'mn

R'mn




Common equity tier 1 capital

41,778

43,857




Additional tier 1 capital

3,388

2,614




Tier 1 capital

45,166

46,471




Tier 2 capital

8,311

11,163




Total regulatory capital

53,477

57,634




Risk-weighted assets per risk type:



Credit risk

242,909

241,652

Counterparty credit risk

8,537

8,643

Credit valuation adjustment risk

3,837

3,900

Equity risk

24,210

10,516

Market Risk

3,819

3,128

Operational risk

27,172

22,855

Total risk-weighted assets

310,484

290,694




Total minimum capital requirement

34,153

31,976




Capital ratios



Common equity tier 1 ratio

13.5%

15.1%

Tier 1 ratio

14.5%

16.0%

Total capital adequacy ratio

17.2%

19.8%

 

 

Leverage ratio disclosures


Excluding unappropriated profits


Investec Limited*

IBL*

As at 31 December 2021

R'mn

R'mn

Tier 1 capital

45,166

46,471

Total exposure

623,061

589,748

Leverage ratio

7.2%

7.9%

 

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

 

 

Liquidity disclosures

 

Liquidity coverage ratio (LCR)

The objective of the 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.

 

With effect from 1 April 2020, the minimum LCR requirement in South Africa was reduced from 100% to 80%. As the PA is now of the view that this relief measure is no longer necessary, the minimum LCR requirement has been revised to 90% from 1 January 2022 and back to 100% from 1 April 2022. This applies for both Investec Bank Limited (IBL) (solo basis) and Investec Bank Limited (IBL) consolidated group.

 

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. This disclosure is in accordance with Pillar 3 of the Basel III liquidity accord, as specified by BCBS d400 (2017) and Directive D1/2018.

 

The following table sets out the LCR for IBL (solo basis) and IBL consolidated group for the quarter ending 31 December 2021:

 


IBL (solo basis) - Total weighted value

IBL consolidated group - Total weighted value

High quality liquid assets (HQLA) (R'mn)

94,350

96,607

Net cash outflows (R'mn)

63,634

63,573

Actual LCR

150.2%

153.8%

Required LCR

80%^

80%^

^ - temporarily reduced from 100% by the PA.

 

The values in the table are calculated as the simple average of 92 calendar daily values over the period 1 October 2021 to 31 December 2021 for IBL (solo basis). IBL consolidated group values use daily values for IBL (solo basis), while those for other group entities use the average of October, November and December 2021 month-end values.

 

Net stable funding ratio (NSFR)

The objective of the NSFR is to promote the resilience of the banking sector by requiring banks to maintain a stable funding profile in relation to the composition of their assets and off-balance sheet activities on an ongoing structural basis. By ensuring that banks do not embark on excessive maturity transformation that is not sustainable, the NSFR is intended to reduce the likelihood that disruptions to a bank's funding sources would erode its liquidity position, increase its risk of failure, and potentially lead to broader systemic risk.

 

The minimum NSFR requirement in South Africa is 100%. This applies to both IBL (solo basis) and IBL consolidated group.

 

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 NSFR disclosure requirements. This disclosure is in accordance with Pillar 3 of the Basel III liquidity accord, as specified by Directive 11/2015 and Directive 01/2018.

 

The following table sets out the NSFR for IBL (solo basis) and IBL consolidated group as at 31 December 2021:

 


IBL (solo basis)

IBL consolidated group

Actual NSFR

115.3%

115.8%

Required NSFR

100%

100%

 

 

 

 

 

 

Further disclosures with respect to Investec Limited's and Investec Bank Limited's capital and liquidity will be provided on the Investec website in due course as required by the relevant regulations.

 

31 January 2022

Sponsor: Investec Bank Limited

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