Nedbank Corporate
HomeBookmark pagePrint page
Mfundo Nkuhlu
Mfundo Nkuhlu
Managing Executive



Corporate Banking

Corporate Banking is a relationship-driven business that focuses on the wholesale corporate market in Southern Africa, with teams based in Johannesburg, Durban, Cape Town and London. Corporate Banking engages with clients who have an annual turnover exceeding R700m and lending requirements greater than R50m. This target market also includes the public sector. It extends a full-service wholesale banking offering from lending and deposit-taking to transactional banking through dedicated teams of corporate bankers and credit and transactional experts, as well as a specialised structured-debt team.


Property Finance

Property Finance specialises in providing specifically structured finance solutions for:

  • Commercial, industrial, retail and residential property developers, investors and owner occupiers.
  • Listed property funds; partnerships – through either joint ventures or minority equity investments.
  • Affordable housing developments.

Transactional Banking

Transactional Banking supports Nedbank Corporate, Nedbank Business Banking and Nedbank Retail through innovative transactional product development. It offers services across SA, in five African countries, and in regions serviced by the Ecobank–Nedbank Alliance. Transactional Banking also manages the international financial relationships with its global banking partners.


Corporate Shared Services

Corporate Shared Services is the delivery and service centre for transactional processing and is primarily responsible for the processing and servicing of wholesale products in support of Nedbank Corporate and Business Banking clients. It also provides transactional processing and servicing for a large portion of Nedbank Retail clients.


Nedbank Investor Services

Nedbank Investor Services (NIS) provides custodial services and secured lending for the collective investments industry.



Given the continuing tough conditions of 2012 we employed the proactive client engagement and early risk identification model, which we have adopted to good effect since the onset of the global financial crisis. We kept an ongoing emphasis on selective origination despite the slower deal flow in the market, while also emphasising an increased focus on governance, compliance and ethical management practices as a result of international failures that were seen in 2012.  

We noted disintermediation across our product offerings during the year, with corporate clients using capital markets as a source of funding at more favourable levels than we are able to offer in certain instances. Investors are also being targeted to fund acquisitions and corporate property funds. Corporates are securing their development pipelines by tapping into their large cash holdings. In addition, competitors have reentered the wholesale market, as well as non-banks that are offering transactional processing solutions.  

Nonetheless, the technical expertise and experience within our cluster, together with our focus on delivering what clients want of a bank, once again enabled us to deliver a solid performance in 2012.  

There were significant client gains in the corporate banking and property arenas. Our focus is on the value as opposed to the number of client gains, since it is scale that will further boost revenue streams.  

The drive to be the public sector bank of choice was enhanced by our reappointment as banker to the Western Cape Government for a further five years to 2017, and by the provision of more than R4bn in new and rollover loans. 

Client surveys in 2012 indicated a marked improvement in the overall Consulta client satisfaction levels and favourably ranked Corporate Banking and Property Finance as well as our product, operational and client service environments. NIS rated again as a market-leading custodian by Global Custodian and Global Finance, continued to expand its services. 

Growth in non-interest revenue (NIR) is being achieved by focusing on acquiring primary banked clients, diversifying revenue lines, improving cross-selling, offering an integrated product suite and reducing the risk of client concentration.  

Greater penetration of the client base led to increased use of transactional banking products. Coupled with this were innovative product launches and enhancements to our electronic banking offering, which contributed to a better client experience.

Our strategic initiatives in providing clients with a transactional fulfilment engine included the adoption of a new cash processing model, reengineering the deposit-taking model, rejuvenating Global Trade products, converting all electronic banking clients to our new electronic channel, and putting our Global Payments System solution into operation. We regularly revisited our processes to shorten turnaround times to clients without compromising our strong risk practices.

Opportunities for growth, also one of the core focus areas, lie in targeting new products, geographies and sectors, innovating and using technology, optimising current relationships and collaborating across cluster units and group divisions.

We were able to gain momentum in this initiative through intergroup collaboration. As a result we granted one of the largest loans for a single property, a R1,3bn development of a large regional shopping centre, as well as a R1,1bn loan for a mixed-use Newtown development that will help rejuvenate part of the Johannesburg central business district, an R850m facility for a new fund listing and the cofunding of a R1,6bn transaction with Nedbank Capital in one of our biggest deals in 2012.

We also made strides into Africa. We leveraged the Ecobank–Nedbank Alliance to provide Africa-destined clients with banking on the ground and we participated in lending opportunities in Ghana, Nigeria, Zambia and Namibia and in the development of trade solutions for client expansion into sub-Saharan Africa.

In the transactional banking area we supported successful card-issuing and card acquisition initiatives in Namibia and web-based banking in Swaziland.

Our branch in London together with the operation in Mauritius, Nedcor Trade Services, made an important contribution to Nedbank Corporate’s international client offering.

We provided the Department of Minerals and Energy with environmental guarantees, especially mining rehabilitation guarantees worth R4,5bn on behalf of clients.

To help reduce client travel and physical processing further, we took our Mobile Banking for Business live across the Android, Apple and BlackBerry platforms.

Other sustainable initiatives included funding for office developments that are expected to gain top ratings from the Green Building Council of SA. In affordable housing we financed just under 10 000 units in 2012, disbursing more than R750m, which benefited about 14 000 people in the lower income groups as defined by the Financial Sector Code.


Another contribution in the environmental arena stemmed from our pioneering engagement in a solution to reduce deposit-processing costs.  

This initiative has resulted in a reduction of paper-based processing by utilising automated workflow, and has eliminated the requirement for printed reports. Furthermore, our clients enjoy greater accuracy of information reflected on their statements and the benefit of improved availability of cheque and deposit slip images to expedite reconciliation processes. The solution has improved signature and technical verification practices and, consequently, our risk management processes. It was to a large extent developed as an industry solution and outsourced to BankservAfrica, which enabled other banks to utilise the same infrastructure to drive down operating costs if they adopted the process.


Teams of staffmembers across Nedbank Corporate also contributed significantly to a broad range of corporate social investment initiatives. These included:

  • The Habitat for Humanity project, which works with the government to build affordable housing in Gauteng, KwaZulu-Natal and the Western Cape. Our teams were among 6 500 volunteers from 34 companies as a result of whose efforts 64 families received new homes at Orange Farm, south of Johannesburg.
  • Raising R370 000 for the Nelson Mandela Institute for Education and Rural Development at an auction of wines donated by members of the Cape Winemakers’ Guild.
  • Raising R1m together with Nedbank Retail for the Reach for a Dream Foundation.
  • Raising funds for SANParks Honorary Rangers, the volunteer organisation supporting SANParks in counterpoaching activities and infrastructure and scientific projects.
  • Supporting the conversion of ground at the MC Weiler School in Alexandra, Johannesburg, into an all-purpose sports field.
  • Partnering with Stop Hunger Now.

Within our cluster we continued to invest in staff development programmes and talent management, with ongoing focus on business education programmes, executive education and bursary allocations. The accredited Property Finance Academy has produced 228 graduates since inception in 2008 and received the Finance Sector Award at the inaugural Skills Summit Achiever Awards.

Similarly, 106 people have participated in our Forex Learnership since its inception in 2008. First of its kind in SA, the programme is accredited by Bankseta and creates a highly skilled pool of talent in what is a very scarce discipline. On successful assessment and certification of competence across all the relevant unit standards, graduates obtain a South African Qualifications Authority (SAQA) national qualification at National Qualifications Framework (NQF)
level 4. 

Talent management, as a key intervention, showed positive results in staff retention, with staff turnover remaining low. Contributors to this are performance management, staff development and reward and recognition programmes. As part of our transformation strategy we exposed our staff to diversity workshops and relaunched our employment equity forum as the Nedbank Corporate Transformation Forum.  

Staff survey results reflected improvements as a result of the positive impact of people management initiatives on our work environment and staff.


Year ended % change 2012 2011
Headline earnings (Rm) 15,7 1 817 1 571
Efficiency ratio (%)   41,1 41,6
Credit loss ratio banking advances (%)   0,24 0,29
Average banking advances (Rm) 5,7 158 978 150 404
Average deposits (Rm) 14,5 149 380 130 497
Allocated economic capital (Rm) 25,9 8 089 6 426
Return on equity (%)   22,5 24,5


Nedbank Corporate grew headline earnings by 15,7% to R1 817m (2011: R1 571m) in the financial year under review. Despite the 25,9% increase in economic capital, our business yielded a return on equity (ROE) of 22,5%, while the economic profit (EP) of R758m was R22m higher than that of 2011.

Net interest income was also 9,3% higher at R3 326m and the margin increased to 2,03% (2011: 1,99%). Growth was mainly driven by increased average deposit balances of 14,5% and by endowment earnings on the increased allocation of economic capital. Average advances grew by 5,7% to R159bn.

Impairments were well managed during 2012, improving by R54m to R385m (2011: R439m). The credit loss ratio (CLR) of 0,24% (2011: 0,29%) remained within our through-the-cycle target range of 0,20% to 0,35%. 

Strong gains in our property private-equity portfolio resulted in total NIR growth of 16,5%. Growth in core NIR of 8,7% was achieved. It was driven by primary-banked client acquisitions, which served to diversify revenue lines and reduce the risk of client concentration. Improvements in cross-selling were also a key contributor to NIR growth, as was our offering of an integrated product suite. This greater penetration of our client base in turn led to greater use of our transactional banking products, while the launching of innovative products and enhancements resulted in continued growth in the contribution of our electronic banking offering.

Expenses increased by 9,8% and the NIR-to-expenses ratio improved to 74,6%, while the efficiency ratio was marginally better at 41,1%.

Corporate Banking posted a 21,5% increase in headline earnings to R1 057m, with excellent revenue growth of 19,8% and 12,1% in NII and NIR respectively. The increases in impairments and expenses were 36,5% and 15,1% respectively.

ROE was 28,3%, down from 29,7% in 2011. This was due to the increase in allocated economic capital of 27,4%, reflecting refinements in risk parameters and the implementation of capital buffers. The cost-to-income ratio improved to 47,3%.

Property Finance recorded a 13,8% increase in headline earnings to R716m. This was underpinned by NIR growth of 40,1% and a 21,3% decrease in impairments. ROE for the period under review was 19,3% (2011: 22,3%) and the cost-to-income ratio improved to 30,2% from 31,4% in 2011.

Both Corporate Banking and Property Finance again succeeded in growing their transactional client bases. However, the emphasis across the entire cluster remained on high-quality service delivery and value generation rather than mere client gains.

Looking forward

The still subdued global economic environment, coupled with a growing realisation that the tough economic conditions are likely to persist, is evident in the continued investment caution shown by SA corporates and muted growth in the country’s commercial property sector.

Despite this challenging environment, we are confident of the ability of Nedbank Corporate to continue to build momentum in the coming year. This will be driven by our stated strategy of client-driven solutions, growth in NIR and proactively seeking out opportunities for growth and project execution, as well as a continued focus on transformation.

  ArrowReturn to top
A member of Old Mutual group

Copyright© Nedbank Ltd. We are an authorised financial services provider. A member of the OLD MUTUAL Group
Nedbank Group Limited Reg No 1966/010630/06, 135 Rivonia Road, Sandown, Sandton, 2196, South Africa