Restructuring boosts bank

Posted On Thursday, 01 August 2002 02:00 Published by
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The restructuring sweeping through the Nedcor Group has been good news for Cape of Good Hope Bank, which acquired a R384m commercial and industrial property mortgage book from sister company Nedcor Investment Bank
The restructuring sweeping through the Nedcor Group has been good news for Cape of Good Hope Bank, which acquired a R384m commercial and industrial property mortgage book from sister company Nedcor Investment Bank.

The transaction could put to rest concern that the bank, which has carved a niche in commercial property, might be marginalised by the restructuring.

The acquisition boosted Cape of Good Hope Bank's property advances to R5,5bn.

'It also means we now have another 600 clients with properties in the major metropolitan areas as well as rural areas across the country,' says head of lending at Cape of Good Hope Bank, Peter Smith.

Reporting its results for the six months ended June, Nedcor Investment Bank said the sold book did not fit within its institutional focus.

Smith says: 'Apart from a boost for our asset growth and generating additional income, the acquisition gives us access to a whole new group of clients, most of them small to medium-sized businesses.'

He says funding for the acquisition was sourced by Cape of Good Hope Bank's treasury and investment centres from the bank's client base.

The acquired portfolio is spread across the country, with R115m in urban Gauteng, R79,7m in Eastern Cape, R78,5m in Western Cape metropolitan areas, and R41,3m in KwaZulu-Natal.

Other substantial components of the book involve R17,8m on the Eastern Cape coast, R11,1m in Transkei, R9m in the Western Cape countryside and R6,3m in urban Free State property.

Smith says most of the book is tied up in commercial property, which accounts for R180,8m, while R134,2m accounts for industrial premises.

Other sectors represented are agriculture, which accounts for R9,6m, the hotel and leisure market (R14,1m), and the residential market (R24,2m).

Sapa


Publisher: Sapa
Source: Sapa

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