Johannesburg, 16 February 2011 – Following an in-depth strategic review, Nedbank is charting a new path to sustainable, profitable growth for its retail business. “Having reflected on our past strategic choices and resultant consequences as well as Nedbank’s strengths and opportunities in an ever changing world, our chosen direction harnesses Nedbank’s unique attributes to deliver a choice of distinctive client-centred banking experiences as a bank for all in South Africa, whilst also seeking to deliver growth and a shareholder return above the cost of capital in the medium term,” says Ingrid Johnson, Nedbank Group Managing Executive of Retail and Business Banking.
The new strategic path is a significant shift away from the previous product focus to a client-centred and integrated business with offerings to distinctive markets. In particular, Nedbank Retail will focus on extending its presence within attractive growth segments, namely youth, entry level banking and small business, whilst rebuilding its historic strength in the middle market. The strong wholesale franchise will be harnessed to access employees of companies through a differentiated Nedbank@Work offering.
Johnson notes that retail is a growing market with another 5 million new entrants likely to enter the formal banking market in the next 10 years and a strong rising middle class. The senior market remains attractive with another 1.4m people entering this segment in the next 10 years.
“We believe this client-centred approach, underpinned by world class risk management practices, will afford us an opportunity to provide positive first interactions with Nedbank on which to build deep and enduring client relationships that embrace key ‘moments of truth’ through their life stages,” says Johnson.
“Our distinctive offerings such as Nedbank Savvy, M-PESA and Personal Loans will attract our fair share of new clients as is already evidenced by Nedbank’s strong 10 year presence in Personal Loans where we hold the number 2 market share amongst the big 4 banks as well as our strong term deposit franchise (number 2 in market).
“I believe Nedbank is now well positioned to entrench itself as a highly aspirational brand within the growing South African banking consumer market,” Johnson says. “Perceptions of Nedbank’s brand positioning have shifted remarkably from elitist to aspirational and this resonates with South Africans who all have aspirations to realise their full potential and financial goals.
“By harnessing our distinctive culture and by listening to and understanding our client’s needs we will make things happen through our 20 000 staff across South Africa who bring our vision to life in their daily interactions with our clients. Communication of our new client-centred vision is vital and to date 2,700 staff members have recently attended roadshows to gain understanding of our exciting future and the important role each will play,” says Johnson. “We have also assembled a strong collaborative leadership team, aligned the accountabilities and enhanced collaboration across Retail and Business Banking to lead the delivery of this new strategic path.
Johnson reflects that “relative to Nedbank’s past efforts to sustainably turnaround Retail, the cohesive strategy and three fundamental imperatives of world class risk management practices; consistent investment in clients through their life stages; and strong alignment of product, channel and customer insights to deliver a choice of distinctive, client-centred experiences should deliver the desired results over time.
“Importantly, rebuilding the client franchise and fundamentally transforming Retail into a client-centred and integrated business is a medium to long term journey. However, given the difference we can make to our clients and communities we serve, while unlocking our fair share of an attractive economic profit pool for our stakeholders, is a goal worth striving for,” Johnson concludes.
Ends.
For more information please contact:
Thembi Malabi
Nedbank Group Communications
082 333 4568
Chama Mwenso
Fleishman-Hillard
082 954 5025
chama.mwenso@fleishman.co.za
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