RMB Holdings lifts dividend 7% after solid FNB performance
Rand Merchant Holdings upped its dividend to 376c for the year to end-June, but warned that structural challenges in SA’s economy persist
RMB Holdings (RMH), which is the biggest shareholder of FirstRand, said on Friday a solid performance from FNB helped grow its headline earnings per share 7% for the year to end-June.
RMH, which holds 34% of SA’s largest banking group by market capitalisation, raised its total dividend 7% to 376c a share.
FirstRand reported on Thursday that its normalised earnings in the year to end-June rose 6% to R27.8bn, thanks largely to gains from FNB.
FNB, the group’s retail and commercial banking unit, grew its pretax profits 11% to R25.3bn.
RMH said on Friday its income from operations, the bulk of which is from the after-tax profits from FirstRand, rose 17% to R10.2bn for the year to end-June.
RMB’s profit for the year rose 17% to R9.97bn, but RMH on Friday echoed concerns from FirstRand that SA’s domestic economic activity would be constrained for the foreseeable future. RMH noted, however, that there appeared to be signs that economic activity was improving in some of the other African countries in which the banking group operates.
“FNB’s momentum is expected to continue, on the back of customer and volume growth, and cross-sell and up-sell strategies will deliver higher insurance revenues and good deposit and advances growth,” RMH said.
RMH was up 0.18% to R73.69 on Friday morning, paring its year-to-date loss to 6.6%.