|» Socioeconomic development (SED)|
|» Corporate social investment (CSI)|
|» Consumer and sustainability education|
|» Youth development|
|» Nedbank Affinities|
|» Transforming financial services|
|» Access to financial services|
|» Targeted investments|
|» Black economic empowerment (BEE) transaction financing|
|» Enterprise development (ED)|
|» Preferential procurement|
Nedbank Group remains committed to delivering social sustainability and economic upliftment that transcends mere compliance. As such, the group has retained the process of setting and delivering on Financial Sector Charter (FSC)-based internal targets as it believes that these will help ensure that it continues to entrench and expand the transformation of the business services and its client base.
ACCESS TO FINANCIAL SERVICES
A significant part of this transformation commitment, and fundamental to Nedbank Group's achievement of its objective to be a bank for all, the group continues to invest in making banking services and accounts more accessible to all members of SA's population.
At the end of 2011 the Nedbank Group boasted a total of 1 080 national Nedbank-branded and staffed points of presence across SA. It continues to take an aggressive approach to growing its footprint in the non-traditional branch space, with several new innovations such as 'Branch in the Box', mobile branches, inretailer outlets, Personal Loan Branches and Personal Loans Kiosks. These innovations bring a much more cost-efficient option for ensuring accessibility for the group's clients and are fast proving their popularity in new markets.
The self-service channel strategy has also been subject to an aggressive expansion plan over the past three years, resulting in a base of 2 272 self-owned Nedbank automated teller machines (ATMs), 549 outsourced ATMs and self-service devices (SSDs), 385 self-service terminals (SSTs) and 6 391 cashback point-of-sale (POS) devices as at the end of 2011.
BLACK AGRICULTURE FINANCE
Nedbank Group's agriculture focus targets the three subsectors of agriculture, namely horticulture, livestock and field crops – all incorporating the entire value chain (primary and secondary agriculture). Clients have access to a focused range of products and to specialist agriculture economists in regional offices throughout the country. Solutions range from access to finance to capacity building and mentorship. In 2011 many emerging black farmers and cooperatives benefited from this approach, which combines finance with business skills training and specialist advisory services. Since 2009 Nedbank Group has provided finance in this area totalling R164m.
AFFORDABLE HOUSING – MORTGAGES
The value of loans originated from January 2011 to December 2011 declined by 31% when compared with the same period in 2010.
Poor credit history and affordability continue to be the biggest hurdles for client approvals.
The cost of an entry-level house is in the region of R300 000, which requires a monthly income of around R10 300 to qualify for a 20-year mortgage. In this case the monthly home loan instalment would be R3 100 a month.
There are signs that the supply of new housing may be improving. This is demonstrated by the 13,9% increase in houses built that are less than 80 m2, a good proxy for affordable-housing activity, when compared with the same period in 2010. Since 2009 Nedbank Group has provided finance in this area totalling R2 037m.
AFFORDABLE HOUSING – DEVELOPMENT FINANCE
Nedbank Group acknowledges the growing need for focused, specialised funding of new affordable-housing developments to increase access to housing for the broad segment of South Africans who are in the lower income brackets. To this end the group's Affordablehousing Unit in the Nedbank Property Finance Division leveraged the momentum achieved in this business during 2009 and 2010 to provide further claimable funding of more than R297m for new affordablehousing developments in the major metropolises across SA.
In acknowledgement of the fact that individuals who earn less than R12 000 a month are unable to afford entry-level affordable housing, the group has implemented a responsive funding approach that enables its clients who develop affordable housing to produce rental stock that caters for those in this lowerincome bracket.
BLACK SMALL AND MEDIUM ENTERPRISE FINANCING SME
plays a critical role in job creation, income generation and the economic growth of the country. However, there are still many challenges that restrict the growth and development of SMEs and Nedbank Group is proactively helping this important sector address and overcome these challenges. Nedbank Business Banking, through its presence in more than 65 locations extends support to SMEs across the country, giving them access to dedicated, skilled bankers supported by a team of finance and business specialists. Solutions are customised from a suite of products and service to meet the individual business needs. This is augmented through a comprehensive enterprise development proposition that offers entrepreneurs easier access to finance, underpinned by training, mentorship, specialist advisory services and capacity building. Since 2009 Nedbank Group has provided finance in this area totalling R3 916m.
Transformational infrastructure deals with financing basic infrastructure in previously disadvantaged areas, assisting those areas to become more productive and part of the mainstream economy. Since 2009 Nedbank Group has provided finance in this area totalling R2 781m.
Some of the major transformational infrastructure projects funded by Nedbank Group in 2011 included:
BLACK ECONOMIC EMPOWERMENT
transaction financing is defined as the supply of equity and transaction financing for BEE companies other than exempted microenterprises (EMEs) and qualifying small entities (QSEs). Nedbank Group remains strongly positioned in this area of transformation financing, the purpose of which is to enable black-empowered and black-owned entities to achieve their growth goals and prosper in the long term. These types of equity deals also facilitate ownership by more people, thereby promoting the sharing of wealth and sustainable development of the economy. Since 2009 Nedbank Group has provided finance in this area totalling R7 349m.
|Breakdown of 2011 Nedbank Group empowerment financing
|Targeted investments||10 590||5 681||2 319|
|Transformational infrastructure||2 781||1 906||559|
|Affordable housing||3 253||2 033||982|
|Black agriculture loans||164||70||20|
|Black SME ﬁnancing||3 916||1 672||759|
|BEE transaction ﬁnancing||7 349||6 570||1 362|
¹ 2011 measurements complies to recommended standards developed as part of the Financial Sector Code.
Enterprise development is a cornerstone of social sustainability for SA as it is key to ongoing creation of much-needed employment opportunities. For Nedbank Group the importance of enterprise development extends even further since, in many ways, it is an essential requirement for the continued expansion and sustainability of the group's business and retail client base.
Given the many barriers to entry for businesses in this country, Nedbank Group takes a multifaceted, highly proactive approach to enterprise development, including a mix of funding, transactional and support products, and services that provide fl exibility and adaptability across all industries.
Some of the enterprise development initiatives undertaken or supported by Nedbank Group in 2011 included:
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