Old Mutual H1 HEPS up 38%

Pan African Financial Services firm Old Mutual is pushing back the launch of its bank to the first quarter of 2025, a delay from the previously anticipated opening this year. The company reported a 7 per cent increase in its interim earnings per share, though operational results dipped 3 per cent due to a heightened focus on growth initiatives. Iain Williamson, CEO of Old Mutual, confirmed the delay in the bank's launch, citing the need to meet remaining regulatory conditions regarding key personnel appointments for the slight postponement. Despite the delay, Williamson expressed confidence in the technical readiness of the bank's systems, highlighting successful testing of payment streams as evidence of solid infrastructure. The bank, to be named OM Bank, will target a mass market audience rather than affluent consumers, contrary to earlier speculations. Seeking to clarify misconceptions, Williamson emphasized the brand's focus on its core customer base. Moving on to the economic landscape, Williamson shared a cautiously optimistic view on South Africa's economy under the government of national unity. Anticipating steady growth supported by factors like sustained low trading levels, interest rate cuts, and currency strengthening, he forecasted a potential GDP growth rate of around 2 per cent for the upcoming year. Reflecting on consumer behavior amid recent policy changes, Williamson discussed the positive impact of the retirement industry's phased withdrawal system, which has seen significant interest from applicants seeking access to liquidity. Despite ongoing withdrawals totaling approximately 1.7 billion Rand, operations have run smoothly, indicating a positive shift towards more managed liquidity strategies for retirement funds. Transitioning to Old Mutual's operations in Zimbabwe, Williamson addressed challenges presented by the country's economic conditions, including hyperinflation and foreign exchange restrictions. Highlighting the business's reliance on US dollar transactions within Zimbabwe, he revealed plans to adjust the reporting structure to better reflect the operational realities. Although forthcoming changes will not impact key operating metrics, they aim to enhance the transparency of financial reporting for the Zimbabwean operations. With an eye on the future, Williamson remains proactive in adapting Old Mutual's strategies to navigate economic uncertainties and regulatory complexities, ensuring resilience and growth across the company's diverse operations.