South Africa’s bank for the wealthy more than doubled investors’ money in five years

In the 2026 financial year, Investec and its shareholders reaped the benefits of the bank’s simplification project over five years ago.

The groundwork laid over five years ago is now paying off, with the bank’s cost-to-income ratio having dropped significantly, from 63.3% in FY22 to 52.9% in the 2026 financial year.

Over the same period, Investec’s share price has more than doubled, up over 160% over the past five years.

Investec released its results for the 2026 financial year, covering the year through March 2026, on Thursday, 21 May.

These results revealed that Investec is still going strong, with operating income of R49.95 billion, up 4.45% in pound terms.

The bank reported a significant decrease in interest income, down 6.85% in pound terms to R85.99 billion, though this was partially offset by a notable reduction in interest expense of 9.36%.

This allowed Investec to report net interest income of R29.63 billion. While still a decrease from the 2025 financial year, the bank’s bottom line benefited from an over 15% increase in fee and commission income to R12.66 billion.

In addition, the bank recorded an 8.6% increase in investment income to R3.15 billion.

The bank reported a profit after tax of R16.10 billion, up 4.62% from 2025, as well as basic earnings per share of around R17.12, up almost 6%.

Investec’s headline earnings per share rose by a far more modest 0.7% to around R16.23, largely due to the decline in net interest income.

While Investec saw growth in its average lending books and benefited from lower funding costs, these gains were offset by the negative endowment effect of declining global interest rates and margin pressure in some of its operating regions.

In addition, the bank’s trading income from balance sheet management and other trading activities fell significantly, down over 60%, driven by mark-to-market movements on the various hedging instruments the bank uses to manage interest rate risk on its balance sheet.

However, Investec referred to this as “accounting mismatches”, saying they are expected to reverse over the life of the instruments.

Total trading income was aided by Investec’s customer flow trading income, which increased by 10.9% to R3.77 billion, driven by higher levels of client FX and interest rate hedging activity in light of heightened market volatility.

Overall, the bank has now successfully transitioned from the period of simplifying and focusing its business five years ago, which has led to substantial improvements in its operational efficiency.

On the back of its strong results, Investec declared a final dividend of 21 pence per share (around R4.66), bringing the total dividend for the year to 38.5 pence (around R8.55).

The decline in Investec’s cost-to-income ratio can be seen in the table below, followed by a graph showing the bank’s share price growth over the past five years.