Old Mutual Yet To Confirm Plans On Expanding into Banking

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Shareholders in the Old Mutual Group enjoyed a special dividend in the group’s maiden interim results as a stand-alone entity, but if and when it might become a fully fledged bank after the Nedbank unbundling remains a guarded secret, Business Day has revealed.

With Nedbank soon to be a much smaller feature of the group’s profits, would a banking licence round out the “universal” integrated financial services model the group has adopted? This was an entirely plausible question Moyo would not be drawn on.

Some of this is informed by flexibility. Given that the group already lends to clients and offers a cheap transactional banking account with a debit card linked to an Old Mutual unit trust, Moyo says that it does not need a banking licence.

“We collect savings not deposits, so we don’t have the more stringent requirements typical of a bank,” he says.

Banking would not be unfamiliar to the group. It already owns Zimbabwe’s second-largest bank, Cabs, and obviously has intimate knowledge of the SA banking landscape through its shareholding in Nedbank. The entry of another well-resourced group with the ability to cross-sell banking products would ratchet up competition in the industry to even higher levels.


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