Investec PLC (LSE:INVP), the Anglo South African bank, reiterated its guidance for the year after despite a lower first-half contribution from the UK.
In a trading update, Investec said profits from its UK businesses, including its wealth management associate Rathbones, would drop by between 5% -11% from last year’s £235 million, with impairments rising.
South Africa will be around 15% ahead of the previous period at £206 million.
As a result, for the half year ending September 30, Investec said it expects underlying operating profit to be between £520 and £550 million, or 6.7% and 12.9% ahead of last year.
Bad debts generally are stable, Investec added, with the cost-to-income ratio dropping below the 53.3% seen in the comparative period.
Return on equity will be at the lower end of guidance at 13-14%.
In the trading update, Investec said: “Revenue momentum from our diversified client franchises continued.
“The initial months of this period were characterised by low levels of activity ahead of the national elections in both our anchor geographies.
“The latter part of this period has seen a more positive economic outlook reflecting increasing certainty on global interest rate cuts.”