Nedbank takes R5bn market cap knock

DURBAN – More than R5billion was wiped off Nedbank’s market cap yesterday after the lender withdrew the financial guidance for 2020 it issued last month, warning that the situation had since deteriorated rapidly.

The bank said that a combination of the rapid escalation of the coronavirus (Covid-19) pandemic, and the downgrades of the country’s sovereign debt had presented unprecedented challenges.

It said the downgrades, which also saw the banks losing their credit rating, had also put its medium and long-term targets for return on equity under review.

“Given the rapid escalation of the Covid-19 pandemic and the material changes to the economic outlook since March 3, these macroeconomic forecasts are no longer valid,” Nedbank said.

“As a result, shareholders are advised that Nedbank Group’s 2020 financial guidance, as provided in our annual results announcement has been withdrawn and our medium and long-term targets are under review.”