FirstRand is a leading financial institution in Africa and its
various brands such as First National Bank, Rand Merchant
Bank, WesBank, Momentum and OUTsurance are already
established in several African markets.
The Group seeks to expand its activities on the African
- Leveraging synergies and platforms between its various
- Growing the commercial banking activities initially in Sub-
Saharan Africa and later potentially in East, Central and West
- Growing its investment and merchant banking activities in
various parts of the continent where it has a product and
skills competitive advantage.
FirstRand hopes to be the first bank from the African continent
to be granted a branch licence to operate in India. It will initially
focus on trade with Southern African and other selected African
countries. We believe that there are significant opportunities in
these markets. India’s trade with Southern Africa comprises
about 20% of the total trade with Africa, and this percentage
increases significantly if one excludes Nigeria’s oil exports.
FirstRand has already established a representative office in
Mumbai. It is staffed by seconded FirstRand staff and new Indian
management. It is able to pave the way for the various FirstRand
divisions that are already implementing business plans that
have been through the internal approval process. They also
support those divisions that are still conducting research into
South Africa is part of the India, Brazil and South Africa (IBSA)
initiative which was signed by the respective governments to
promote trade and other relations between the three countries.
Brazil is a potentially significant trading partner of South Africa.
It has a population of 160 million, a GDP growth of about 4%, a
stable political environment and a commitment to sound macro
economic policies. FirstRand believes that there are many
similarities between the Brazilian and South African economy
that provide excellent opportunities for some of our divisions.
CURRENT INTERNATIONAL OPERATIONS AND
The most appropriate way to detail the Group’s current
international operations is by franchise.
FNB, the commercial bank, is already present in Namibia,
Botswana, Swaziland, Lesotho and Moçambique. These
operations currently represent around 5% of total Group
earnings and have consistently delivered strong growth in profits
and superior ROE’s.
Going forward, FNB’s strategy is to enter certain additional
strategic African markets with particular focus on the SADEC
region given its proximity to South Africa. FNB’s long term
objective is to become a full service bank offering a
comprehensive range of commercial, retail and corporate
transactional banking products and services. It has already demonstrated that in these markets it can offer a competitive
advantage particularly given its strong brand and innovative
FNB favours a “Greenfields” or “accelerated Greenfields” approach, and board approval has been granted to pursue the establishment of a branch in Zambia and a representative office in Angola.
RMB has already had success in several business areas, including Private Equity in Australia, Infrastructure and Project Finance predominantly in Africa, Trade Finance in Africa and other emerging markets and Resources in Africa. It is well placed to capitalise on the planned infrastructure plans of rapidly emerging African economies such as Nigeria and Angola and is focused on building this already successful business.
RMB is currently exploring investment banking partnerships with local banks in several jurisdictions that have the presence and balance sheet to complement its expertise in investment banking, most notably in Nigeria.
WesBank has identified the Brazilian asset finance market as its most attractive off shore business opportunity due to the macro economic environment and the rapid growth in vehicle finance. At this stage WesBank is investigating entering this market via a partnership with Banco do Brazil. It will allow WesBank to access a powerful brand, funding from a strong balance sheet and a very extensive distribution network.
In addition to the Brazilian initiative, WesBank currently operates in the UK market with the Carlyle Finance franchise. This is a niche operation which has now found itself in a very difficult market, so its focus is on achieving operational efficiencies in order to create a stable platform for future growth.
Momentum’s strategy in Africa is currently focused on a health product driven strategy. It currently operates in 8 countries.
In addition it has a successful London office of RMB Asset Management, which operates alongside Ashburton, the established fund and private client investment manager based in the Channel Islands. Together they provide a comprehensive range of international asset management capabilities to South African and international clients.
In conclusion, FirstRand’s primary focus is on the South African market where we believe we have significant opportunities for growth. In addition, we are actively exploring international markets in our divisions with the objective of providing growth impetus to the Group over the medium to long term.
Chief executive officer