Old Mutual on track with plans to launch new bank as it delivers stellar results

Old Mutual has reported a 28% rise in full-year earnings for 2023.

Delivering its results for the year ended 31 December, the insurer said 'profitability remained strong despite the challenging operating environment'.

Headline earnings were up 26% to R7.38 billion.

Headline earnings per share (HEPS) rose 28% to 165.5 cents (2022: 129.2 cents).

Old Mutual declared a final dividend of 49 cents per share, up 4% from the previous year.

On The Money Show, CEO Iain Williamson highlights the specifics of Old Mutual's strategy around focusing on the customer, along with building out their value propositions and integrated financial services capability,

"And being on the back of very good top line growth and some market share gains in our key customer businesses, we are really delighted with the outcome."

"Really pleasing was the sales growth on the life side - 17%, on the short term insurance side 14%, value of new business up 37% on the life side... and then headline earnings up 26%, so we looked after our expenses properly."

Iain Williamson, CEO - Old Mutual

What is really encouraging, Williamson says, is that the result didn't come from one or two businesses performing well, but from ALL of the businesses making a positive contribution.

He notes that the market as a whole grew in pockets, and went backward in others.

"Consumers are under a lot of pressure... and they're prioritising their spend decisions between putting food on the table, buying airtime and worrying about whether they're going to continue paying their insurance premiums."

"We've seen persistency pressure which is people's continued ability to pay premiums on policies they already have. That worsened in the first half of last year and started to get better in the second... and we've seen a continuation of the trend."

Iain Williamson, CEO - Old Mutual

Williamson anticipates the launch of their new bank by the end of the year, as required regulatory processes are completed.

"We finished the build for the technical platform to support the bank capability in December at a budget of R1.75 billion, so it doesn't come with a small cheque attached to it!"

Iain Williamson, CEO - Old Mutual