Generating 90% of its profits from the South African market, Nedbank aims to target high-potential sectors such as renewable energy and infrastructure development.
South African banking group Nedbank is allocating a package worth 12 billion rand ($662 million) to expand its operations into other markets, particularly in sub-Saharan Africa. This information was shared by Bloomberg on Monday, November 18, 2024, citing the group’s regional head for Africa.
“If we grow as expected, we could easily achieve between 20% and 30%, or even close to 40%, of our total profit from African markets outside South Africa within five to ten years, compared to just 9.2% currently,” said Terence Sibiya. “Nedbank will be a different bank by 2029,” he added.
Ranked fourth by assets in South Africa, Nedbank operates subsidiaries in Eswatini, Mozambique, Lesotho, Namibia, and Zimbabwe, as well as a representative office in Kenya. It also holds a 21% stake in pan-African group Ecobank Transnational Incorporated (ETI).
Sibiya, speaking as the bank’s Group Managing Executive for Client Coverage, acknowledged that Nedbank’s current African equity presence is “modest.” However, he revealed that the bank is developing a strategy to expand into emerging sectors on the continent, such as renewable energy and natural resources.
“There will be a clear focus on scaling up in existing markets and capturing a larger share of what we consider to be profitable pools,” said Sibiya.
Boosting Renewable Energy Investments
The bank is reportedly eyeing projects in Mozambique’s liquefied natural gas (LNG) sector, Namibia’s mining and hydrogen exploration, and plans to develop an investment banking product in Kenya to facilitate financing for renewable energy and infrastructure across the East African Community (EAC) region.
In addition, Nedbank plans to expand its Kenyan office by establishing an asset management division and creating a fund focused on women-led small businesses in the East African region.
“Considering our existing skills and areas of expertise within our arsenal, we firmly believe there is a significant growth opportunity across the continent,” Sibiya concluded.
