Nedbank said yesterday that the Covid-19 outbreak led to a strategic shift to stay relevant to its clients in the face of the pandemic. Photographer: Lubabalo Poswa/ African News Agency (ANA)
DURBAN - NEDBANK said yesterday that the Covid-19 outbreak led to a strategic shift to stay relevant to its clients in the face of the pandemic.
Chief executive Mike Brown said given the unprecedented challenges created by the pandemic, they proactively looked for ways to assist their clients to weather the storm and manage the impact on their finances and provided some form of financial relief to around 20 percent of their loan book.
“The impact of the Covid-19 pandemic has resulted in a tilt in our strategic focus since the lockdown started towards the end of March.
“Initially, our focus was on ‘Resilience’, as we managed the group through the most restrictive phases of the lockdown and the extreme volatility in financial markets. In level 4 and 5 of lockdown we invoked business continuity plans and enabled remote working across the enterprise as we continued to deliver essential banking services,” Brown said.
He said this included focusing on ensuring that their IT systems were stable and available, educating clients and staff regarding digital solutions and capabilities available to them, providing debt relief to qualifying clients, launching new digital solutions such as Avo.
Nedbank launched a new “super app” called Avo in May to give the bank’s customers access to online shopping, essential services and financial products on a single platform.
“From a financial perspective, our focus was on managing liquidity, capital, market and credit risk. The year 2020 was certainly a very challenging one – but one that Nedbank and the SA financial sector has navigated very well,” Brown added.
The group’s primary focus since the crisis began was on the health and safety of its staff, the continuous and uninterrupted provision of banking and other financial services to its clients and remaining resilient in a time where metrics like return on equity and headline earnings were less important.
Looking ahead, Brown said forecasting in the current environment remained complex and estimates were subject to a much higher level of forecast risk than usual, but they were cautiously optimistic that the worst impacts of Covid-19 and the lockdown were behind them and that impairments in the second half of 2020 and into 2021 would be lower than in the first half of 2020 and client activity would continue to increase off a low base.
“The environment for our staff, clients and other stakeholders, as well as the world of financial services and banking is likely to be materially different after the Covid-19 pandemic. We will seek to identify opportunities to create new streams of revenue, enhance operations and optimise the structure of our businesses. Key components of this strategy include digital leadership,” he said.
However, Brown said they were very encouraged by third-quarter gross domestic product figures, which rebounded by 66.1 percent, reflecting an economy that was still under pressure, but recovering from the height of the Covid-19 lockdown.
BUSINESS REPORT