Investment Idea: FirstRand Limited

On 6 March 2025, FirstRand released its results for the first half of its 2025 financial year, covering the six months ending 31 December 2024. Key highlights from the results include: 1. Earnings per share (ESP) grew by 8% to R3.76, with revenue increasing by 5% outperforming a 3% rise in operating costs. 2. Net interest income increased by 4%.

• Average interest earnings assets grew by 4%, with progression across segments. RMB Corporate and Investment Banking (CIB) advances was the largest contributor, growing their end of period balance by 9% year-over-year, while FNB commercial showed strong growth of 12% although being smaller in size.
• Net interest margin was stable at 4.47%.

3. Non-interest revenue increased by 6%, with the net commission and fee income increasing 8% to R20.7b driven by FNB customer acquisition (+3%), transactional volume growth (+5%) and fee increases. Net commission and fee income was further helped by RMB’s knowledge-based fee income benefitting from new deal origination opportunities coupled with an uptick in advisory income. We maintained our intrinsic value of R97 and our recommendation at a buy.