| | | | --- | --- | | | | | | | | | | | | INVESTEC ANNUAL REPORT 2025 | | | | | | Investec Bank plc annual financial statements | #### Key to icons | | | | | --- | --- | --- | | | | | | | | Alternative performance measures We supplement our IFRS figures with alternative performance measures used by management internally and which provide valuable, relevant information. These measures are highlighted with the symbol shown here. The description of alternative performance measures and their calculation is provided in the alternative performance measures section. | | | | | | | | Audited information Denotes information in the risk and remuneration reports that forms part of the Group's audited annual financial statements. | | | | | | | | Page references Refers readers to information elsewhere in this report. | | | | | | | | Website Indicates that additional information is available on our website: www.investec.com | | | | | | Group_sustainability.svg | | Group sustainability Refers readers to further information in the Investec Group's 2025 sustainability report which is published and available on our website: www.investec.com | | | | | | Reporting_standard.svg | | Reporting standard Denotes our consideration of a reporting standard. | | | | | | Unaudited_information.svg | | Unaudited information Indicated information which has not been audited. | | | | | | Strategic_report.svg | | Strategic report The operational and strategic overview section together with the financial review section (sections 1 and 2 of this report respectively, and together, the strategic report) provide an overview of our strategic position, performance during the financial year and outlook for the business. These should be read in conjunction with the sections referenced below which elaborate on the aspects highlighted in the strategic report: • The risk management section in section 3 of this report which provides a description of the principal risks and uncertainties facing the company; and • The Investec Group's 2025 sustainability report on our website which highlights the sustainability, economic, social and environmental considerations. | | | | | | Integrating_sustainability.svg | | Integrating sustainability Indicates where we have incorporated sustainability content, aims and ambitions. | Feedback We value feedback and invite questions and comments on our reporting. To give feedback please contact our Investor Relations division. For queries regarding information in this document: Investor relations Tel:(27) 11 291 0178 (44) 20 7597 5504 Email:investorrelations@investec.com | | | | --- | --- | | | | | | [www.investec.com/en\_za/](www.investec.com/en_za/welcome-to-investec/about-us/investor-relations.html) [welcome-to-investec/about-us/](www.investec.com/en_za/welcome-to-investec/about-us/investor-relations.html) [investor-relations.html](www.investec.com/en_za/welcome-to-investec/about-us/investor-relations.html) | 1 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Strategic focus | CONTENTS | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CONTENTS | | | | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | 01 | Operational and strategic overview | | Sections 01 to 02 comprise our Strategic Report | | | | Our business at a glance | [4](#i447e4d363cd344738300acdd42f0e3a0_3762) | | | Our operational footprint | [6](#i447e4d363cd344738300acdd42f0e3a0_40) | | | Overview of the Investec Group’s and Investec Bank plc’s organisational structure | [8](#i447e4d363cd344738300acdd42f0e3a0_25) | | | | Our strategic objectives | [9](#i447e4d363cd344738300acdd42f0e3a0_58) | | | | Our performance at a glance | [11](#i447e4d363cd344738300acdd42f0e3a0_73) | | | | Stakeholder engagement (Section 172 statement) | [15](#i447e4d363cd344738300acdd42f0e3a0_88) | | | | | | | | 02 | Financial review | | Salient features | [26](#i447e4d363cd344738300acdd42f0e3a0_109) | | | Pro-forma income statements | [27](#i447e4d363cd344738300acdd42f0e3a0_112) | | | Financial review | [28](#i447e4d363cd344738300acdd42f0e3a0_115) | | | Divisional review | [32](#i447e4d363cd344738300acdd42f0e3a0_118) | | | | | | | | | | | | 03 | Risk management and governance | | Risk management approach and framework | [42](#i447e4d363cd344738300acdd42f0e3a0_175) | | | Year in review from a risk perspective | [43](#i447e4d363cd344738300acdd42f0e3a0_178) | | | Principal risks | [45](#i447e4d363cd344738300acdd42f0e3a0_181) | | | Corporate governance | [61](#i447e4d363cd344738300acdd42f0e3a0_190) | | | Directors’ report | [88](#i447e4d363cd344738300acdd42f0e3a0_241) | | | | | | | | | | | | 04 | Remuneration report | | Remuneration report | [96](#i447e4d363cd344738300acdd42f0e3a0_250) | | | | | | | | | | | | 05 | Annual financial statements | | Independent auditor’s report to the member of Investec Bank plc | [108](#i447e4d363cd344738300acdd42f0e3a0_3848290701184) | | | Consolidated income statement | [119](#i447e4d363cd344738300acdd42f0e3a0_265) | | | Consolidated statement of comprehensive income | [120](#i447e4d363cd344738300acdd42f0e3a0_268) | | | | Balance sheets | [121](#i447e4d363cd344738300acdd42f0e3a0_271) | | | | Cash flow statements | [123](#i447e4d363cd344738300acdd42f0e3a0_274) | | | | Statement of changes in equity | [124](#i447e4d363cd344738300acdd42f0e3a0_277) | | | | Accounting policies | [128](#i447e4d363cd344738300acdd42f0e3a0_280) | | | | Notes to the financial statements | [143](#i447e4d363cd344738300acdd42f0e3a0_283) | | | | | Notes to risk and capital management | [248](#i447e4d363cd344738300acdd42f0e3a0_484) | | | | | | | | 06 | Sustainability statement | | Introduction | [296](#i447e4d363cd344738300acdd42f0e3a0_2990) | | | ESRS 2: General information | [296](#i447e4d363cd344738300acdd42f0e3a0_2998) | | | ESRS E: Environment | [321](#i447e4d363cd344738300acdd42f0e3a0_3004) | | | | ESRS S: Social | [335](#i447e4d363cd344738300acdd42f0e3a0_3011) | | | | ESRS G: Governance | [349](#i447e4d363cd344738300acdd42f0e3a0_3028) | | | | Directors Responsibilities Statement for Sustainability | [356](#i447e4d363cd344738300acdd42f0e3a0_3609) | | | | Independent Practitioners Limited Assurance Report on the Sustainability Report | [357](#i447e4d363cd344738300acdd42f0e3a0_3914) | | | | Appendix | [360](#i447e4d363cd344738300acdd42f0e3a0_3035) | | | | | | | | | | | Alternative performance measures | [392](#i447e4d363cd344738300acdd42f0e3a0_532) | | | | | Definitions | [393](#i447e4d363cd344738300acdd42f0e3a0_535) | | | | | Glossary | [394](#i447e4d363cd344738300acdd42f0e3a0_538) | | | | | Credit ratings | [396](#i447e4d363cd344738300acdd42f0e3a0_541) | | | | | Corporate information | [397](#i447e4d363cd344738300acdd42f0e3a0_544) | The Independent auditor’s reasonable assurance report in relation to the Electronic Format Annual Financial Report is appended to the end of the Annual Report. 2 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | 01 | | | Operational and ## strategic overview IN THIS SECTION | | | | --- | --- | | | | | [4](#i447e4d363cd344738300acdd42f0e3a0_3762) | Our business at a glance | | | | | 5 | Our key business highlights | | | | | [6](#i447e4d363cd344738300acdd42f0e3a0_40) | Investec’s operational footprint | | | | | [8](#i447e4d363cd344738300acdd42f0e3a0_25) | Overview of the Investec Group’s and Investec Bank plc’s organisational structure | | | | | | | | [9](#i447e4d363cd344738300acdd42f0e3a0_58) | Our strategic objectives | | | | | [10](#i447e4d363cd344738300acdd42f0e3a0_3848290701077) | Overview of the activities of Investec Bank plc | | | | | [11](#i447e4d363cd344738300acdd42f0e3a0_73) | Our performance at a glance | | | | | [15](#i447e4d363cd344738300acdd42f0e3a0_88) | Stakeholder engagement (Section 172 statement) | | | | 3 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | | | | #### Our purpose is to create enduring worth. This underpins who we are and how we create long- term sustainable value. This #### section provides an overview #### of Investec Bank plc. 4 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | OUR BUSINESS AT A GLANCE | | | | | | #### Our purpose is to # create enduring | | | --- | | | | | # worth | | | | --- | --- | | | | | | | #### Investec Group’s mission Investec is a distinctive bank and wealth manager, driven by commitment to our purpose, values, core philosophies and culture. We deliver exceptional service to our clients in the areas of banking and wealth management, striving to create long-term value for all of our stakeholders and contributing meaningfully to our people, communities and the planet. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | Investec Group’s distinction The Investec distinction is embodied in our entrepreneurial culture, supported by a strong risk management discipline, client-centric approach and an ability to be nimble, flexible and innovative. We do not seek to be all things to all people. Our aim is to build well-defined, value-adding businesses focused on serving the needs of select market niches where we can compete effectively and build scale and relevance. Our unique positioning is reflected in our iconic brand, our high-touch and high-tech approach and our positive contribution to society, macro- economic stability and the environment. Ours is a culture that values purposeful thinking and stimulates extraordinary performance. We take pride in the strength of our leadership team and our people are empowered and committed to our values and culture. | | | | | | | | | Corporate / Institutional / Government / Intermediary | | | Private Clients (HNW / High Income) / Charities / Trusts | | | | ATAGLANCE_ARROWS.svg | | | | | | | | | | --- | --- | --- | --- | | | | | | | | Specialist Banking | | | | | | | | | | Corporate and Investment Banking, Private Banking | | | | | | | | | | Lending | | | | | Transactional banking | | | | | Treasury solutions | | | | | Advisory | | | | | Investment activities | | | | | Deposit-raising activities | | | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | | Wealth & Investment | | | | | | | | | | | | | | | | | | | | Discretionary wealth management | | | | | Investment advisory services | | | | | Financial planning | | | | | Stockbroking | | | | | | | | | | | | | | | | | | 5 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | OUR KEY BUSINESS HIGHLIGHTS | | | | | | | | | | --- | --- | | | | | | | | Our responsibility | | | | | | Our purpose to ‘create enduring worth’ is inseparable from being a sustainable business – it is rooted in the belief that our contribution to society and the planet should be an integral part of our business rather than a peripheral consideration. Our sustainability strategy is built on the understanding that our business should actively contribute to the betterment of society and our planet. | | | | | | | | | £14.9 billion sustainable and transition finance by 2030 | | | | | | --- | --- | | | | | | | | Our values | | | | | | Deep client partnerships, built on trust and Out of the Ordinary service, are the bedrock of our business | | | | | | | | | We uphold cast-iron integrity in all our dealings, consistently displaying moral strength | | | | | | | | | We seek creative, talented people with passion, energy and stamina, who collaborate unselfishly | | | | | | | | | We thrive on change and challenge the status quo with courage, constantly innovating and adapting to an ever-changing world | | | | | | | | | We believe in open and honest dialogue to test decisions, seek consensus and accept responsibility | | | | | | | | | We pursue diversity and strive to create an environment in which everyone can bring their whole selves | | | | | | | | | We show care for people, support our colleagues and respect the dignity and worth of the individual | | | | | | | | | We are committed to living in society, not off it, contributing meaningfully to the communities in which we operate | | | | | | | | | We embrace our responsibility to the environment and the wellbeing of our planet | | | | | | | | | We trust our people to exercise their judgement, promoting entrepreneurial flair and freedom to operate with risk consciousness and unwavering adherence to our values | | | | | | --- | --- | | | | | | | | Investec Group’s investment proposition | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | | | | | | 1 | | 2 | | 3 | | Well-capitalised and highly liquid balance sheet | | Committed to optimising shareholder returns – managing capital dynamically and allocating it to activities that generate returns above cost of capital | | Diversified mix of earnings by business and geography | | | | | | | | 4 | | 5 | | 6 | | Building scale and leveraging our existing franchises – we operate in large and growing markets | | Executing on specific growth initiatives to drive entrenchment and positive incremental returns | | Clear path to achieving the upper end of our medium-term targets | 6 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INVESTEC’S OPERATIONAL FOOTPRINT | | | | | | | | | | | --- | --- | --- | | | | | | | | | | | | --- | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Investec’s main international footprint | | | | | | | | | | | | | | | | | | | | | | Since inception, Investec has expanded through a combination of substantial organic growth and a series of strategic acquisitions. Our focus today is on growth in our chosen markets. | | | | | | | | | | | | | | | | | | | | | | Wealth-Investment-Activities.png | Wealth & Investment Activities | | | | | | | | | | Private Client.png | Private Client Banking Activities | | | | | | | | | | Corporate Investment.png | Corporate and Investment Banking Activities | | | | | | | | | | Corporate Advisory.png | Corporate Advisory and Investment Activities | | | | | | | | | | Property.png | Property Activities | | | | | | | | | | | Securities | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | | | | USA USA.png | | Established a presence in 1998 | | Energy and Infrastructure Finance, Fund Solutions, Aviation Finance and Institutional Equities business providing research and sales activities | | | | | | --- | | | | Ireland Ireland.png | | Established a presence in 1999 | | Treasury Risk Solutions and Institutional Equities business | | | | | | --- | | | | United Kingdom UK_1.svg | | Established a presence in 1992 | | Corporate, institutional and private client banking activities Wealth management services offered through our long-term strategic partnership with Rathbones | | | | --- | | | | Channel Islands | | Established a presence in Guernsey (1998), Jersey (2007) and Isle of Man (2018) | | Private banking, lending and treasury services to private clients and financial intermediaries Custody and Execution-only services through our independent nominee company Wealth management services offered through our long-term strategic partnership with Rathbones | | | | --- | | | | Switzerland Switzerland.png | | Established a presence in 1974 | | Private banking and Wealth management services offered to private clients, family offices, trusts and corporate service providers | 7 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INVESTEC’S OPERATIONAL FOOTPRINT CONTINUED | | | | | | | | | --- | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | | | | Continental Europe Continental Europe.png | | Established a presence in 2023 | | Investment banking activities including M&A advisory, corporate lending, fund solutions and risk management services | | | | --- | | | | Dubai International Finance Centre (DIFC) NEW_DUBAI (1).png | | Established a presence in 2024 | | Advisory and arranging services in private banking, wealth and investment management, as well as corporate and investment banking | | | | --- | | | | South Africa South Africa.png | | Established a presence in 1974 | | Corporate, institutional and private client banking activities Wealth and investment management services with the ability to leverage off the global platform | | | | --- | | | | Mauritius | | Established a presence in 1997 | | Corporate, institutional and private client banking activities Wealth management services | | | | --- | | | | India India.png | | Established a presence in 2010 | | Institutional equities business providing research, sales and trading activities Sales desk located in Singapore for Indian equities to Singaporean institutional investors Merchant banking business connecting Indian companies with domestic and international investors Investment management services in structured credit and other products | 8 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | OVERVIEW OF THE INVESTEC GROUP’S AND INVESTEC BANK PLC’S ORGANISATIONAL STRUCTURE | | | | | | #### Investec Bank #### plc (IBP) is the main banking subsidiary of Investec plc . During July 2002, Investec Group Limited (since renamed Investec Limited) implemented a dual listed companies (DLC) structure and listed its offshore business on the London Stock Exchange (LSE). In terms of our DLC structure, Investec Limited is the holding company of the Investec Group’s businesses in Southern Africa, and Investec plc is the holding company of Investec Group’s non-Southern African businesses. Investec Limited is listed on the Johannesburg Stock Exchange Limited (JSE) South Africa (since 1986) and Investec plc on the LSE (since 2002). All references in this report to the Bank, IBP or the Group relate to Investec Bank plc and its subsidiaries, whereas references to Investec, Investec Group or DLC relate to the combined DLC Group comprising Investec plc and Investec Limited. | | | | --- | --- | | | | | | A circular on the establishment of our DLC structure was issued on 20 June 2002 and is available on our website. | Our DLC structure and main operating subsidiaries and associates | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | Non-Southern African operations | At_A_Glance_Diagonal_Stripe2.png | | | Southern African operations | | | | | | | | | | | | | Investec plc | | Investec Limited | | | | | | | | | | | | | | | | | | | | LSE primary listing | | JSE primary listing | | | JSE secondary listing | | BSE secondary listing | | | A2X secondary listing | | NSX secondary listing | | | | | A2X secondary listing | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Investec Bank plc | | | | | | | | Investec Bank Limited | | | Investec Wealth & Investment International Group | | | | | | | | | 41.25% economic interest | | | | | | Rathbones Group plc | | | | | | | | | | \*All shareholdings in the ordinary share capital of the subsidiaries shown are 100% unless otherwise stated. Salient features of the DLC structure • Investec plc and Investec Limited are separate legal entities and have separate listings, but are bound together by contractual agreements and mechanisms • Investec operates as if it is a single unified economic enterprise • Shareholders have common economic and voting interests as if Investec plc and Investec Limited were a single company • Creditors, however, are ring-fenced to either Investec plc or Investec Limited as there are no cross-guarantees between the companies. 9 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | OUR STRATEGIC OBJECTIVES | | | | | | #### Our #### strategy defines the #### strategic choices we make #### in pursuit of our purpose of #### creating enduring worth . We have formulated our strategy with a balanced consideration of our stakeholders’ needs and priorities. | | | | --- | --- | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Our stakeholders | | | | | | Further integrating sustainability into our business strategy | | | | | | | | | | | | | | | Strategic intent Disciplined growth | | | | | | Clients | | | | | | People | | | | | | | Communities | | | | | | | Planet | | | | | | | | | Shareholders | | Purpose | Our strategic direction | Culture and values | | | | | | | | | | | | | | | | | | | | | | | | | | Growth objectives | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | #### Our growth objectives | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | W_Connected client ecosystems.svg | | Continued execution with discipline to drive optimisation of returns | | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | W_Growth initiatives.svg | | Accelerate and scale growth initiatives | | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | W_Entrepreneurial culture.svg | | Further develop connected client ecosystems across business units and geographies | | | | | | | #### Underpinned by | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | W_Optimisation of returns.svg | | Deepening our entrepreneurial culture (Out of the Ordinary: speed of execution & client experience) | | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | W_Digitialisation.svg | | Continuous digitalisation | | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | W_Strategic Use.svg | | Strategic use of data | | | | | | | 10 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | OVERVIEW OF THE ACTIVITIES OF INVESTEC BANK PLC | | | | | | | | | | | --- | --- | --- | | | | | | | | | | | Specialist banking | | | | | | Our teams are well positioned to provide solutions to meet private, corporate and institutional clients’ needs. Each business provides specialised products and services to defined target markets. | | | --- | | | | | #### What makes us distinct? • Provision of high-touch personalised service, with ability to execute quickly • Ability to leverage international, cross-border platforms • Well positioned to capture opportunities between the developed and the emerging world • Strong ability to originate, manufacture and distribute • Balanced business model with good business depth and breadth • Provision of high-quality solutions to corporate and private clients, with leading positions in select areas. | | | --- | | | | | We provide our clients with an extensive depth and breadth of products and services in the corporate mid market, bespoke solutions to high net worth (HNW) clients and access to a wealth management offering through our strategic partnership with Rathbones. We leverage our connected client ecosystem to deliver an exceptional client service with an entrepreneurial approach. | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Private client banking activities | | | | | Corporate and investment banking activities | | | | | | | | | | | | | | | | | | | | | | HNW private clients | | | | | Corporate, private, intermediary, government and institutional clients | | | | | | | | | | | | | | | | | | | | | | Helping our clients create and preserve wealth with our high-touch and high-tech private client offering | | | | | A highly valued partner and adviser to our clients | | | | | | | | | | | | | | | | | | | | | | UK, Channel Islands and Switzerland | | | | | UK and Europe, Channel Islands, USA, India | | | | | | | | | | | | | | | | | | | | | | • Lending • Private capital • Transactional banking • Savings • Foreign exchange. | | | | | • Lending • Treasury and risk management solutions • Advisory • Institutional research, sales and trading. | | | | | | | | | | | | | | | | | | | | | | Our high-touch and high-tech private client offering provides transactional banking, lending, private capital, savings and foreign exchange tailored to suit our clients’ needs. Our target market includes HNW active wealth creators (with >£300 000 annual income and >£3 million net asset value (NAV)). Our savings offering targets primarily UK retail savers. | | | | | Our client-centric, solution-driven offering provides Corporate Banking and Investment Banking services to private companies, private equity and sponsor-backed companies and publicly listed companies. | | | | | | | | | | | | | | | | --- | --- | --- | | | | | | | Natural linkages between the private client and corporate business | | | | | 11 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | OUR PERFORMANCE AT A GLANCE | | | | | | #### A strong performance in a volatile #### operating environment | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | | Adjusted operating profit\* increased 3.4% | | | | £496.8mn | | | | | 2024: £480.4 million | | | | | | | | | | Earnings attributable to ordinary shareholder decreased 49.1% \*\* | | | | | £366.4mn | | | | | 2024: £719.6 million | | | | | | | | \* Pro-forma profit before tax, adjusted to remove goodwill, acquired intangibles and strategic actions, including such items within equity- accounted earnings and non-controlling interests. \*\*The decrease in earnings attributable to ordinary shareholders reflects the significant net gain recognised in the prior year  associated with the combination between Investec Wealth & Investment Limited and Rathbones Group. Refer to page 208 for additional information. Note: All prior year numbers in this financial commentary are presented on a pro-forma basis to provide information that is more comparable to the current year, as a result of previously disclosed strategic actions which completed in the first half of the prior financial year. Refer to page [27](#i447e4d363cd344738300acdd42f0e3a0_112) for the reconciliation between the statutory and pro-forma prior year income statement. • Pre-provision adjusted operating profit for the financial year ended 31 March 2025 increased by 4.9%; our established client franchises in the UK mid market and selected geographies performed well in a volatile macro- economic environment. We have continued to execute our client acquisition and entrenchment strategies as we focus on building scale and growing market share • To date, we have established a robust business foundation and demonstrated strong performance. We are strategically investing in our transactional banking capabilities in both private and corporate banking to complement our existing core specialisations • Revenue remained flat; strong growth in net fee and commission income generated from both our corporate and investment banking lending franchises and our M&A Advisory business in line with our strategy to grow capital light earnings, was offset by lower net interest income and lower trading income from customer flow. Investment income contributed positively to revenue • Operating costs decreased by 4.6%. Fixed operating cost growth reflects investment in technology platforms and strategic projects to enable future growth, as well as inflationary pressures. The prior year includes a £30 million motor finance provision. Variable remuneration decreased in line with business performance • Net core loans grew by 1.4% since 31 March 2024 driven by growth in the UK residential mortgage lending portfolio, while the corporate lending segment remained flat in a constrained market environment. Moderate growth across various corporate lending portfolios was offset by higher levels of repayments • ECL impairment charges totalled £97.0 million, resulting in a credit loss ratio of 60bps (2024: 58bps). The increase in ECL charges was largely driven by Stage 3 ECL charges on certain exposures. We have seen no evidence of trend deterioration in the overall credit quality of our books • The all-share combination of IW&I UK and Rathbones successfully completed at the end of 1H2024, creating a leading discretionary wealth manager with £104.1 billion Funds under Management and Administration (FUMA) at 31 March 2025 • In the current year Investec Bank Plc has equity accounted £69.1 million (FY2024: £66.9 million) being Investec Bank Plc’s 41.25% share of Rathbones post-tax underlying profit attributable to shareholders for their year ended 31 December 2024 of £167.6 million • Funds under Management (FUM) from the Wealth and Investment business in Switzerland increased to £2.7 billion at 31 March 2025 (2024: £2.1 billion) • Taken together, Investec Bank plc reported an adjusted operating profit of £496.8 million for the year (2024: £480.4 million ). 12 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | OUR PERFORMANCE AT A GLANCE CONTINUED | | | | | | #### Financial performance (pro forma) | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | Adjusted operating profit increased 3.4% | | 2025 £ 496.8mn | | | | 2024 £480.4mn | | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | Cost to income ratio | | 2025 50.2% | | | | 2024 52.5% | | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | Credit loss ratio | | 2025 60bps | | | | 2024 58bps | #### Diversified business model | | | | --- | --- | | | | | | Contribution of adjusted operating profit^ | | % | | ![3073]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Specialist Banking | | | Wealth & Investment | ^ The prior years have been presented on a pro-forma basis, the prior year pro- forma income statement can be found on page [27](#i447e4d363cd344738300acdd42f0e3a0_112). Continued growth of our key earnings drivers | | | | --- | --- | | | | | | | | | Customer accounts (deposits) increased 3.4% to £ 21.6 billion | | | | | | | | | | | | Core loans increased 1.4% to £16.8 billion | | | | | | | | --- | --- | | | | | Customer accounts (deposits) and loans | | | £’billion | % | ![3279]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Net core loans (LHS) | | | Customer accounts (deposits) (LHS) | | | Loans as a % of customer deposits (RHS) | | | | | | | | | | | | | --- | --- | | | | | | | | | Funds under management increased 26.3% to £ 2.7 billion reflecting favourable market movements | | | Rathbones\* FUMA of £104.1 billion at 31 March 2025 \*   IBP has a 41.25% economic interest in Rathbones | | | | 13 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | OUR PERFORMANCE AT A GLANCE CONTINUED | | | | | | #### Strong and improved annuity base | | | | --- | --- | | | | | Total operating income^ | | | £’million | Percentage | ![3323]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Net interest income | | | Net fees and commission income | | | Investment and associate income | | | Trading income | | | Other operating income | | | Annuity income\* as a % of total operating income | | | | | \*Where annuity income is net interest income and annuity fees. | | | | --- | --- | | | | | | | | | Revenue was driven by strong growth in fee and commission income generated from both our corporate lending franchises and our M&A Advisory business. This was offset by lower net interest income and lower trading income from customer flow. | | | | | | | --- | | | | Expected credit loss (ECL) impairment charges | | £’million | ![3396]() | | | --- | | | | Adjusted operating profit – Wealth & Investment^ | | £’million | ![3401]() ^The prior years have been presented on a pro-forma basis The prior year pro-forma income statement can be found on page [27](#i447e4d363cd344738300acdd42f0e3a0_112). | | | | | --- | --- | --- | | | | | | | Revenue growth is ahead of cost growth, resulting in positive jaws^ | | | | | | ![3556]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Period-on-period % change in revenue | | | | | | | | Period-on-period % change in costs | | | | | | | | | | | --- | --- | --- | | | | | | | | | | | Fixed operating costs increased by 4.4% excluding the impact of the £30 million motor finance provision raised in the prior year. Variable remuneration decreased in line with business performance. | | | | | | | | | | --- | --- | | | | | Default and core loans | | | £’billion | Percentage | ![3564]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Net core loans (LHS) | | | Credit loss ratio (RHS) | | | | | | | Net default loans before collateral as a % of net core loans/Stage 3 exposure net of ECL as a % of net core loans subject to ECL (RHS) | | | | | | | | | --- | | | | Adjusted operating profit – Specialist Banking | | £’million | ![3571]() 14 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | OUR PERFORMANCE AT A GLANCE CONTINUED | | | | | | #### Maintained a sound balance sheet The involvement of executive management ensures stringent management of risk, capital and liquidity as set out below. #### Capital management | | | | | --- | --- | --- | | | | | | | | | | | Capital and leverage ratios remain sound, ahead of internal targets and regulatory requirements. Investec Bank plc calculates capital requirements using the standardised approach under the Basel III framework, thus our risk weighted assets represent a large portion of our total assets. We are comfortable with our Common Equity Tier 1 (CET1) ratio at 13.6% given our solid capital light revenues, and with the leverage ratio at 10.5% . | | | | | | Capital ratios | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | 31 March 2025^ | | 31 March 2024^ | | | Common Equity Tier 1 ratio\* | 13.6% | | 13.3% | | | Common Equity Tier 1 ratio (fully loaded)\*\* | 13.6% | | 13.2% | | | Tier 1 ratio\* | 15.4% | | 15.9% | | | Total Capital ratio\* | 19.2% | | 19.8% | | | Leverage ratio | 10.5% | | 10.7% | | | Leverage ratio (fully loaded)\*\* | 10.5% | | 10.7% | | \*The CET1, Tier 1 and Total Capital ratios are calculated applying the IFRS 9 transitional arrangements. \*\*The CET1 ratio (fully loaded) and the leverage ratio (fully loaded) assumes full adoption of IFRS 9. ^The capital adequacy and leverage disclosures for Investec Bank Plc include the deduction of foreseeable charges and dividends when calculating CET1 and Tier 1 capital. These disclosures differ from the disclosures included in the Investec Group’s year-end results booklet 2025, which follow our normal basis of presentation and do not include this deduction. Investec Bank Plc’s CET1 ratio would be 37bps (31 March 2024: 34bps) and leverage ratio 25bps (31 March 2024: 23 bps) higher, on this basis. | | | | --- | --- | | | | | | Note: Refer to pages [287](#i447e4d363cd344738300acdd42f0e3a0_526) to [291](#i7c92788fb1474a82a8a57477341a81fa_14284) for further details. | #### A well-established liquidity management philosophy remains in place | | | | | --- | --- | --- | | | | | | | | | | | Continued to focus on: • Maintaining a high level of readily available, high-quality liquid assets targeting a minimum cash to customer deposit ratio of 25%, with the year-end ratio at 42.2% • Diversifying funding sources • Maintaining an appropriate mix of term funding • Maintaining low reliance on wholesale funding • Benefitting from a growing retail deposit franchise and recording an increase in customer deposits. Liquidity remained strong with cash and near cash balances amounting to £9.1 billion (2024: £9.7 billion ). Average cash balances remained high as we maintained a conservative position. We exceeded the minimum regulatory requirements for the liquidity coverage ratio (LCR) and net stable funding ratio (NSFR). The Bank’s loan to deposit ratio was 78.0% (2024: 79.5%). | | | | | | | | | --- | | | | Cash and near cash trend | £’million ![4554]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Central bank cash placement and other HQLA | | | Cash | | | Near cash | | | | 15 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STAKEHOLDER ENGAGEMENT | | | | | | #### Listening #### to and engaging with our #### stakeholders | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | The Board values the importance of meeting the diverse needs and expectations of all stakeholders and building lasting relationships with them. Effective communication and stakeholder engagement are integral in building stakeholder value. The Board is committed to providing meaningful, transparent, timely and accurate financial and non-financial information to primary stakeholders, enabling them to make meaningful assessments and informed investment decisions. In order to achieve these outcomes, the Board addresses material matters of significant interest and concern, highlighting key risks to which the business is exposed and responses to mitigate these risks. Investec Bank Plc is a wholly-owned subsidiary of Investec plc (refer to operational structure on page [8](#i447e4d363cd344738300acdd42f0e3a0_25)) and as such has one shareholder. The Investec Bank Plc Board communicates regularly with the Board of Investec plc. Certain Investec Bank Plc engagements with its stakeholders are performed on an Investec Group basis such as maintenance of its website, investor relations activity and environmental, social and governance (ESG) engagement. Section 172(1) statement This section of the strategic report describes how the directors have had regard to the matters set out in Section 172(1), and forms the directors’ statement required under the Companies Act 2006. This statement also provides details of how the directors have engaged with and had regard to the interests of our key stakeholders. | | | | | | | | Strong partnerships and understanding are essential to the creation of enduring worth. To be the best we can be, and to understand stakeholders’ needs, we work hard to establish the most effective ways of engaging with them. Engagement is important to us because it means we can understand stakeholder views and are able to respond in a meaningful and impactful way. We gather feedback through continuous dialogue with our stakeholders throughout the year to gain an understanding of their needs. This year, we have also conducted a double materiality assessment which has helped us further understand which sustainability-related topics are important to our stakeholders. These interactions inform what we focus on, how we engage with our stakeholders and how, through our strategy and purpose, we can improve as a business. As detailed on the pages that follow, the Board’s oversight of engagement with our stakeholders informed their principal decisions during the year. 16 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STAKEHOLDER ENGAGEMENT CONTINUED | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Our clients | | | | | | | | | | | | | | | | | | | | | At Investec, we are all about partnerships, striving to build deep and long-lasting relationships with our clients. | | | | | | | | | | | | How we engage • Client engagement is managed by senior management and client relationship managers. The Board receives updates from senior management on key client issues • Client engagement has returned to predominantly face-to-face meetings • Comprehensive, user-friendly website and mobile app • Regular telephone and email communications • Industry-relevant events and client marketing events. Value created in FY2025 • Continued success in HNW client acquisition, growing our client base by 6.6% in the UK • We have further developed our ‘One Investec’ mindset, a client-centric approach which brings all of Investec that is relevant to every client, enabling us to leverage the whole of our capability to provide solutions most relevant to clients’ needs • Ranked first in the UK by The Banker in its annual list of best-performing UK banks • Ranked within the top 5 European Direct Lenders by the Debtwire 2024 European Direct Lender Rankings • Ranked best service from an Asset Based Finance Provider in Moneyfacts Awards. | | | | | | | | | | | | What we focus on • Dependable engagement • Innovative and creative solutions • Financial support • Enhanced cyber security • Competitive pricing Material topics • Client engagement and marketing • Ethical business conduct • Data privacy and cyber security | | | | | | | | | | | | | | | | | | | | | | | | ![]() ![Stakeholder_clients_wave.png]() | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | Our people | | | | | | | | | | | | | | | | | | | | | | | | | Our culture is the core of our organisation. We recognise that enabling an engaged and diverse workforce that is deeply skilled and culturally embedded is essential for our success. | | | | | | | | | | | | | How we engage • A designated non-executive director (NED) oversees workforce engagement for the Group across its multiple jurisdictions • Ongoing communication from executive leadership via email updates and other digital platforms • An induction programme hosted by senior leaders for new employees, seeking to induce and foster our culture, purpose and strategic intent • Learning, leadership development and diversity programmes offered to all employees • Regular staff updates on the Group’s strategy and performance hosted by executive leadership • A global employee app offering employees mobile access to our digital workplace • Ongoing engagements with employees on diversity and inclusion • Comprehensive wellbeing programme. Value created in FY2025 • Established our Investec Alumni community enabling alumni to stay connected to the organisation • Recognised as an employer of choice, Investec ranked 52nd out of 500 in the Financial Times UK Best Employers 2025 list • Focused on the implications of artificial intelligence (AI) in the workplace and designed learning resources on both AI and sustainability. | | | | | | | | | | | | | What we focus on • Our purpose, culture and values • Meaningful communication • Learning, development and career progression • Belonging, inclusion, diversity and equity • Physical and mental wellbeing • Flexible working conditions • Fair remuneration Material issues • Employee mental and physical health • Belonging, inclusion and diversity • Employee remuneration • Employee rights | | | | | | | | | | | | | | ![]() ![Stakeholder_people_wave.png]() \* includes permanent employees, temporary employees and contractors. 17 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STAKEHOLDER ENGAGEMENT CONTINUED | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Investors | | | | | | | | | | | | | | | | | | | | | We engage with debt investors who hold instruments in Investec Bank Plc. | | | | | | | | | | | How we engage • Regular meetings with Executive Directors, senior management and Investor Relations • Investor roadshows and presentations • Stock exchange announcements • Comprehensive investor relations website • Regular telephone and email communications • Investor roadshows and presentations. Value created in FY2025 • Successfully completed a €500 million Senior issuance in February 2025, resulting in an oversubscribed order book of €1.9 billion • Engaged with 28 debt investors in the UK and Europe since November, for a non- deal debt roadshow. | | | | | | | | | | | What we focus on • Progress against strategic objectives • Financial performance and guidance on future performance • Credit ratings • Capital and liquidity position • Balance sheet resilience • Business sustainability Material issues • Ethical business conduct • Transparency and disclosures • Energy transition finance • Financed emissions | | | | | | | | | | | | | | | ![]() ![Stakeholder_investors_wave.png]() | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Communities | | | | | | | | | | | | | | | | | | | | | Our commitment to societal contribution, diversity and nurturing entrepreneurship informs our community support, focused on education, entrepreneurship and the environment. | | | | | | | | | | | | How we engage • Regular meetings, calls and emails with our community partners • Comprehensive community website and social media platforms to encourage participation • Staff volunteering • Awareness campaigns to educate staff and communities • Community partners and non-governmental organisations (NGOs) invited to collaborate at conferences and events. Value created in FY2025 • Achieved £1.9 million community spend on education and learnerships, entrepreneurship and job creation, as well as the environment and other philanthropy initiatives (2024: £2.0 million) • Funded four social enterprises during the year through the Investec Beyond Business (IBB) programme • 3 693 staff volunteering hours in the past year (2024: 3 510 hours) • Supported 2 812 Arrival learners in the UK since inception (2024: 2 260 learners) • Since late 2022, Investec has supported The Felix Project in redistributing the equivalent of over 640 000 meals to London individuals in need. | | | | | | | | | | | | What we focus on • Financial and non-financial support • Staff volunteerism • Education and learnership opportunities • Skills training and job creation • Environmental protection • Climate change and net-zero commitments | | | | | | | | | | | | | | | | | | | | | | | | | | ![]() ![Stakeholder_communities_wave.png]() 18 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STAKEHOLDER ENGAGEMENT CONTINUED | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Government and regulators | | | | | | | | | | | | | | | | | | | | | We maintain continuous engagement with government and regulators in our key markets to ensure our business adapts to evolving regulatory requirements. | | | How we engage • Our Chair of the Board, Board members, CEO and Executive Directors hold regular meetings with the UK Prudential Regulation Authority • Regular interactions with the UK Financial Conduct Authority • Active participation in a number of policy forums • Attendance of Investec Bank Plc’s Chair NED representation at the FCA’s Chair and NED banking conference • Engagement with other industry consultative bodies. Value created in FY2025 • Received regulatory approval for the rebranding of Capitalmind entities to Investec in European geographies France, Germany and Netherlands • Received approval for the appointment of John Reizenstein as Chair of the IBP Board • Received approval for the appointment of Vivek Ahuja as a Non-Executive Director of Investec Bank Plc • The FCA has awarded a green rating for our Consumer Duty Board Reporting. | | | | | | | | | | | | | | | | What we focus on • Regulatory compliance and governance adherence • Accurate regulatory submissions and returns • Strong prudential standards and oversight • Fair treatment of clients and employees • Financial and operational resilience • Risk and capital management • Capital, liquidity and reverse stress testing • Group tax strategy Material topics • Regulatory and legal compliance • Transparency and disclosures • Data privacy and cyber security • Energy transition finance | | | | | | | | | | | | | | | | | | | | | | | | | | ![Stakeholder_gov_regulators_wave.png]() | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Sustainability and climate-focused industry bodies and analysts | | | | | | | | | | | | | | | | | | | | | We engage with sustainability experts and collaborate with our clients to actively support a just transition to a low-carbon, sustainable economy. | | | How we engage • Annual sustainability report and factsheets • Comprehensive sustainability website • Additional disclosures, including a standalone TCFD report • Our Chief Executive is a member of the UN Global Investors for Sustainable Development Alliance (GISD) • Active industry participation in several sustainability-related forums such as PCAF and Net-Zero Banking Alliance. Value created in FY2025 • Introduced an enhanced Sustainable and Transition Finance Classification Framework, along with a commitment to contribute £14.9 billion towards the Investec Group’s 2030 target, to promote sustainable and transition finance activities and support environmental and social outcomes • Reduced coal exposure to 0.00% of loan book (2024: 0.05%) - successfully achieving our target of zero coal exposure in the loan book as of September 2024, ahead of our initial timeline of 31 March 2027 • Increased the proportion of renewables in our energy lending portfolio to 73.97% from 52.35% • Enhanced the quality and scope of our Scope 3 financed emissions data • Continued support for our clients with financing that aligns with our priority SDGs and a just transition to a sustainable economy. | | | | | | | | | | | | | | What we focus on • Our climate policy and framework • Enhancing data quality inputs for Scope 3 emissions and committing to net zero by 2050 • Managing and mitigating direct climate change impact within our operations and indirect climate change impact through our loan book and investment portfolio • Addressing sustainability risks in our business Material topics • Financed emissions • Energy transition finance • Employee remuneration | | | | | | | | | | | | | | | | | | | | | | | | | | ![]() ![Our sustainability and climate-focused_WAVE.svg]() 19 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STAKEHOLDER ENGAGEMENT CONTINUED | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Our suppliers | | | | | | | | | | | | | | | | | | | | | We collaborate with suppliers and sub- contractors and expect them to be resilient as well as operate and behave ethically and in an environmentally and socially responsible manner. | | | How we engage • Engaging suppliers and involving other business functions as required. For example, the Group sustainability team may conduct a sustainability review once a supplier is engaged • Centralised negotiation process • Procurement questionnaires requesting information on suppliers’ environmental, social and ethical policies • Screening against ethical supply chain practices • Due diligence on financial information, cyber security and operational resilience. Value created in FY2025 • Consolidated and migrated all our vendor onboarding systems onto one system, which gives us a view of all third parties • Continued to improve our due diligence processes around financial crime, data and information security. Critical third parties are monitored 24/7 to ensure compliance with agreed Service Level Agreements (SLAs) • Utilise detailed procurement questionnaires to gather information on suppliers’ environmental, social and ethical policies to ensure alignment with our sustainability goals. | | | | | | | | | | | | | | | | What we focus on • Compliance with applicable environmental, labour and anti-corruption laws and regulations • Prompt payment practices • Fair and transparent RFP and negotiation practices • Clear guidance on policies and procedures, such as due diligence and onboarding Material topics • Ethical business conduct | | | | | | | | | | | | | | | | | | | | | | | | | | ![Stakeholder_suppliers_wave.png]() 20 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STAKEHOLDER ENGAGEMENT CONTINUED | | | | | | Here we outline the principal decisions taken by the Board during the year and their impact on our stakeholders. #### Strategic direction Context Following Investec Group’s management succession in 2018, a comprehensive strategic review was conducted to ensure that the Group and all its subsidiaries including IBP remained well positioned to serve the long-term interests of all stakeholders. At the 2019 Capital Markets Day (CMD) the IBP executive team announced its intention to simplify and focus the business; certain strategic actions were identified to improve capital allocation, operational performance and long-term growth. In the five years following the CMD the Board oversaw the execution of various decisions taken to progress this strategy, including the demerger of the Asset Management business, the closure, sale and restructure of certain non-core and subscale businesses, the reduction of operating costs and delivery of loan growth and client acquisition. | | | --- | | | | | The Board is pleased that the structural objectives and performance targets presented at the CMD have been achieved and in FY2024 the Bank published upgraded financial target ranges. Stakeholders considered in the decision: | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Our clients | | | Our people | | | | --- | | | | | #### How were stakeholder interests considered? The Investec Group Board has continued its engagement with shareholders and investors mainly through one-on-one dialogue, conferences, and results presentations, and endeavours to incorporate shareholder feedback in its oversight of strategic execution. Feedback from investors over the current and previous financial years reflected a need for the communication of a path that demonstrates how the business intends to achieve the upper end of the upgraded ROE and ROTE targets. This feedback was considered in the Board’s review of current growth initiatives and the decision to clearly articulate the path to achieving the upper end of the Group’s stated financial targets in the medium term. The Board also considered the perspective of employees, ensuring that the evolution of the Group’s strategy incorporates internal input, and is appropriately communicated at all levels of the Group’s operations. #### Outcomes Management has identified specific growth initiatives which will underpin the achievement of the upper end of upgraded financial targets by FY2030. The Board has overseen the development of clear, measurable key performance indicators (KPIs) for each growth initiative. The path to achieving the upper end of our targets was communicated in the Investec Group’s results presentation on 22 May 2025. It is now possible to track progress against these KPIs and the road to the upper end of the target range is clear. Management intends to provide updates to the market on the Bank’s growth initiatives for Corporate mid-market and for Private Clients over the coming months. 21 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STAKEHOLDER ENGAGEMENT CONTINUED | | | | | | #### Setting our sustainable and #### transition finance target Context One of the Board’s key sustainability- related focus areas for the current financial year was overseeing progress in setting a sustainable and transition finance target. This ambition followed the release of the Investec Group’s enhanced Sustainable and Transition Finance Classification Framework in May 2024. The aim of this target is to catalyse a shift in our commercial strategies that increase sustainability-related outcomes. #### Stakeholders considered in the decision | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | Our clients | | | Our people | | BUSINESSMODEL_ICONS-08.svg | Our communities | | BUSINESSMODEL_ICONS-10.svg | Our planet | | | | | | | #### How were stakeholder interests considered? • This target emphasises our commitment to assisting clients in their decarbonisation efforts • The Bank adopted a bottom-up approach to target-setting, encouraging understanding and ownership among our people • Our people are incentivised through this target to provide financing to clients who are transitioning towards a sustainable future • Feedback gathered from investors during the Investec Group roadshows was considered in the target-setting process and the integration of this target into DLC executive remuneration • The Bank engaged with clients and our strategic partner, Holtara (an award-winning sustainability services provider), to develop innovative financing mechanisms aimed at making sustainability-linked loans more affordable and accessible for our clients • The Bank engaged with sustainability and climate-focused industry bodies and analysts to discuss progress and plans, ensuring their insights were incorporated into the target-setting process. #### Outcomes The Investec Group’s target was announced with the year-end results in May 2025. IBP undertakes to contribute £14.9 billion towards the Investec Group’s target to facilitate £18 billion of sustainable and transition finance by 2030. Our people felt engaged in the target-setting process, fostering a sense of ownership that translates into increased motivation to contribute towards Investec’s sustainability objectives. 22 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STAKEHOLDER ENGAGEMENT CONTINUED | | | | | | #### Non-executive succession Context During the year, the Board effectively managed its succession planning in response to key leadership transitions. Brian Stevenson stepped down as Chair and Non-Executive Director of IBP in July 2024, and Zarina Bassa resigned from her roles as a member of the IBP Board and IBP Audit Committee in August 2024. | | | --- | | | | | Stakeholders considered in the decision: | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | BUSINESSMODEL_ICONS-12.svg | Our regulators | | BUSINESSMODEL_ICONS-07.svg | Our investors | | | Our people | | | | --- | | | | | #### How were stakeholder interests #### considered? In line with established succession planning processes, the Board continuously reviewed recruitment priorities to enhance its effectiveness by focusing on the necessary knowledge, skills and experience required for future appointments. The Board developed comprehensive candidate specifications outlining the necessary skills, experience and personal attributes to meet the Board’s strategic needs, committee requirements and upcoming retirements. This approach aligns with the Board’s commitment to diversity and inclusivity, ensuring an unbiased selection process that prioritises varied backgrounds and perspectives to reflect and serve the diverse interests of stakeholders. #### Outcomes Following a formal and rigorous process, Vivek Ahuja was appointed as independent Non-Executive Director to the IBP Board effective March 2025. Additionally, Vivek was appointed to the IBP Audit Committee. An accountant by training, Vivek brings extensive international financial services experience across banking and private equity, enhancing the Board’s expertise and strategic capabilities. Furthermore, John Reizenstein was appointed as Chair of IBP following Brian Stevenson stepping down in July 2024. Investec remains committed to continuously reviewing Board recruitment priorities and assessing the desired skills and experience of potential candidates to further enhance Board effectiveness. 23 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 01 | | Operational and strategic overview | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | 24 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | 02 | | | ## Financial ## review IN THIS SECTION | | | | --- | --- | | | | | [26](#i447e4d363cd344738300acdd42f0e3a0_109) | Salient features | | | | | 27 | Pro-forma income statements | | | | | [28](#i447e4d363cd344738300acdd42f0e3a0_115) | Financial review | | | | | [32](#i447e4d363cd344738300acdd42f0e3a0_118) | Divisional review | | | | 25 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | | | | #### We have delivered strong #### financial performance #### notwithstanding the uncertain operating environment. This section contains a review of #### Investec Bank plc’s results. 26 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SALIENT FEATURES | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | | 31 March 2025 | 31 March 2024\* | % change | | Income statement and selected returns for IBP on a pro-forma basis | | | | | Earnings attributable to ordinary shareholders (£’000) | 366 419 | 719 609 | (49.1%) | | Adjusted operating profit (£’000)^^^ | 496 823 | 480 372 | 3.4% | | Operating costs (£’000) | 597 719 | 626 732 | (4.6%) | | Cost to income ratio^^ | 50.2% | 52.5% | | | Return on average assets\* | 1.3% | 1.3% | | | Return on average risk weighted assets\* | 2.0% | 2.1% | | | Net interest income as a % of operating income | 66.3% | 69.4% | | | Non-interest income as a % of operating income | 33.7% | 30.6% | | | Annuity income as a % of total operating income | 69.3% | 70.9% | | | | | | | | | 31 March 2025 | 31 March 2024 | % change | | Balance sheet | | | | | Total assets (£’million) | 29 734 | 29 838 | (0.3%) | | Net core loans (£’million) | 16 791 | 16 557 | 1.4% | | Cash and near cash balances (£’million) | 9 090 | 9 652 | (5.8%) | | Customer accounts (deposits) (£’million) | 21 555 | 20 851 | 3.4% | | Funds under management (£’million) | 2 691 | 2 130 | 26.3% | | Gearing ratio (total assets to equity) | 8.1x | 8.3x\*\* | | | Level 3 (fair value assets) as a % of total assets | 9.4% | 8.1\*\* | | | Core loans to equity ratio | 4.6x | 4.6x | | | Loans and advances to customers as a % of customer deposits | 78.0% | 79.5% | | | Credit loss ratio | 0.60% | 0.58% | | | Stage 3 exposures as a % of gross core loans subject to ECL | 3.3% | 3.3% | | | Stage 3 exposures net of ECL as a % of net core loans subject to ECL | 2.7% | 2.6% | | | | | | | | Other regulatory ratios | | | | | LCR (IBP solo basis) | 418% | 519% | | | NSFR (IBP solo basis) | 144% | 144% | | | | | | | | Capital and leverage^ | | | | | Total Capital ratio | 19.2% | 19.8% | | | Tier 1 ratio | 15.4% | 15.9% | | | Common Equity Tier 1 ratio | 13.6% | 13.3% | | | Leverage ratio | 10.5% | 10.7% | | \*Average balances are calculated on a straight-line average. \*\*Restated as detailed in note 57 on page [242](#i447e4d363cd344738300acdd42f0e3a0_475). ^The capital and leverage ratios are calculated applying the IFRS 9 transitional arrangements. ^^Presented on a pro-forma basis. See page [27](#i447e4d363cd344738300acdd42f0e3a0_112) for the prior year pro-forma income statement. ^^^Presented on a pro-forma basis. See page [392](#i447e4d363cd344738300acdd42f0e3a0_532) for calculation. 27 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRO FORMA | | | | | | #### Pro-forma income statements Given the nature of the IW&I UK transaction, the Group’s economic interest remained similar before and after the transaction. To provide information that will be more comparable to the future presentation of returns from the Group’s interest in this entity and given the new holding structures, pro-forma information has been prepared as if the transaction had been in effect from the beginning of the period, i.e. IW&I UK has been presented as an equity-accounted investment. All the financial analysis that follows will be based on the pro-forma income statements provided below. | | | | | | --- | --- | --- | --- | | | | | | | £’000 | Year to 31 March 2024 | Re-presentation of Investec Wealth & Investment Limited | Year to 31 March 2024 Pro forma | | Interest income | 1 933 984 | — | 1 933 984 | | Interest expense | (1 105 027) | — | (1 105 027) | | Net interest income | 828 957 | — | 828 957 | | Fee and commission income | 178 770 | — | 178 770 | | Fee and commission expense | (16 381) | — | (16 381) | | Investment income | 2 625 | — | 2 625 | | Share of post-taxation profit of associates and joint venture holdings | 31 287 | 35 855 | 67 142 | | Trading income/(loss) arising from | | | | | – customer flow | 103 158 | — | 103 158 | | – balance sheet management and other trading activities | 27 119 | — | 27 119 | | Other operating income | 2 915 | — | 2 915 | | Operating income | 1 158 450 | 35 855 | 1 194 305 | | Expected credit loss impairment charges | (85 997) | — | (85 997) | | Operating income after expected credit loss impairment charges | 1 072 453 | 35 855 | 1 108 308 | | Operating costs | (626 732) | — | (626 732) | | Operating profit before goodwill, acquired intangibles and strategic actions | 445 721 | 35 855 | 481 576 | | Amortisation of acquired intangibles | (940) | — | (940) | | Amortisation of acquired intangibles of associate | (5 679) | — | (5 679) | | Closure and rundown of the Hong Kong direct investments business | (784) | — | (784) | | Operating profit | 438 318 | 35 855 | 474 173 | | Financial impact of strategic actions | (16 576) | — | (16 576) | | Profit before taxation | 421 742 | 35 855 | 457 597 | | Taxation on operating profit before goodwill, acquired intangibles and strategic actions | (96 956) | — | (96 956) | | Taxation on goodwill, acquired intangibles and strategic actions | 427 | — | 427 | | Profit after taxation from continuing operations | 325 213 | 35 855 | 361 068 | | Profit after taxation from discontinued operations\* | 395 600 | (35 855) | 359 745 | | Profit after taxation | 720 813 | — | 720 813 | | Profit attributable to other non-controlling interests | (1 204) | — | (1 204) | | Earnings attributable to shareholder | 719 609 | — | 719 609 | | | | | | | Cost to income ratio | 50.2% | | 52.5% | \*Refer to page [207](#i5267682315fb43b7a284679cf0caeb4d_1867) for discontinued operations disclosure. Note: No adjustments have been made to the balance sheet for the purposes of our pro-forma disclosures. 28 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | FINANCIAL REVIEW | | | | | | #### Overview Investec Bank plc’s adjusted operating profit increased by 3.4% to £496.8 million for the year ended 31 March 2025 (2024: £480.4 million) supported by the diversity in our client franchises and geographies and the integrated approach in how we provide solutions for our clients. We have continued to execute our client acquisition and entrenchment strategies as we focus on building scale and our growing market share. #### Income statement analysis The overview that follows will highlight the main reasons for the variance in the major category line items on the face of the income statement during the year under review. Operating income Operating income £1 191.6 million was 0.2% lower than the prior year. The various components of operating income are analysed below. | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | £’000 | 31 March 2025 | % of total income | | 31 March 2024 | % of total income | % change | | | Net interest income | 790 461 | 66.3% | | 828 957 | 69.4% | (4.6%) | | | Net fee and commission income | 180 476 | 15.1% | | 162 389 | 13.6% | 11.1% | | | Investment income | 41 811 | 3.5% | | 2 625 | 0.2% | >100% | | | Share of post-taxation profit of associates and joint venture holdings | 72 380 | 6.1% | | 67 142 | 5.6% | 7.8% | | | Trading income/(loss) arising from | | | | | | | | | – customer flow | 85 542 | 7.2% | | 103 158 | 8.6% | (17.1%) | | | – balance sheet management and other trading activities | 14 248 | 1.2% | | 27 119 | 2.3% | (>100%) | | | Other operating income | 6 676 | 0.6% | | 2 915 | 0.3% | >100% | | | Operating income | 1 191 594 | 100.0% | | 1 194 305 | 100.0% | (0.2%) | | The following table sets out information on total operating income before expected credit loss impairment charges on loans and advances by division for the year under review: | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | £’000 | 31 March 2025 | % of total income | | 31 March 2024 | % of total income | % change | | | Wealth & Investment | 87 657 | 7.4% | | 84 824 | 7.1% | 3.3% | | | Private Banking | 100 570 | 8.4% | | 112 861 | 9.4% | (10.9%) | | | Corporate, Investment Banking and Other | 1 003 367 | 84.2% | | 996 620 | 83.4% | 0.7% | | | Total operating income | 1 191 594 | 100.0% | | 1 194 305 | 100.0% | (0.2%) | | | | | | | --- | --- | --- | | | | | | % of total operating income | | | | 31 March 2025 £ 1 191.6 million total operating income | | 31 March 2024 £ 1 194.3 million total operating income | ![996]() ![1000]() | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | Net interest income | 66.3% | | | Net interest income | 69.4% | | | Net fee and commission income | 15.1% | | | Net fee and commission income | 13.6% | | | Investment income | 3.5% | | | Investment income | 0.2% | | | Share of post-taxation profit of associates and joint venture holdings | 6.1% | | | Share of post-taxation profit of associates and joint venture holdings | 5.6% | | | Trading income arising from customer flow | 7.2% | | | Trading income arising from customer flow | 8.6% | | | Trading income arising from balance sheet management and other trading activities | 1.2% | | | Trading income arising from balance sheet management and other trading activities | 2.3% | | | Other operating income | 0.6% | | | Other operating income | 0.3% | 29 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | FINANCIAL REVIEW CONTINUED | | | | | | Net interest income Net interest income decreased by 4.6% to £790.5 million (2024: £ 829.0 million). The benefit of a larger average loan book was offset by higher cost of funding as deposits repriced higher and lower average interest rates over the period. Our client acquisition strategies are the key underpin to the sustained loan book growth across diversified specialisations. | | | | --- | --- | | | | | | For a further analysis of interest received and interest paid on a statutory basis refer to page [146](#i447e4d363cd344738300acdd42f0e3a0_289) . | Net fee and commission income Net fee and commission income increased by 11.1% to £180.5 million (2024: £162.4 million). Higher lending and arrangement fees were generated by our corporate & investment banking lending business driven by increased client activity. We have also seen higher M&A Advisory fees primarily from Capitalmind (now Investec Continental Europe Advisory) our European advisory franchise; reflecting both improved performance and the impact of a full year of consolidated earnings as it became a subsidiary in June 2023. | | | | --- | --- | | | | | | For a further analysis of net fee and commission income on a statutory basis refer to page [147](#i447e4d363cd344738300acdd42f0e3a0_292) . | Investment income Investment income of £41.8 million (2024: £2.6 million) was largely driven by net fair value gains from equity investments. | | | | --- | --- | | | | | | For a further analysis of investment income on a statutory basis refer to page [147](#i447e4d363cd344738300acdd42f0e3a0_295) . | Share of post-taxation profit of associates and joint venture holdings Share of post-tax operating profit of associates and joint venture holdings amounted to £72.4 million (2024: £67.1 million) primarily consisting of Investec’s share of Rathbones’ reported post-tax underlying profit attributable to shareholders for their year ended 31 December 2024 of £69.1 million (2024: £66.9 million). Trading income Trading income from customer flow declined to £85.5 million (2024: £103.2 million), primarily as a result of lower risk management gains from hedging the significantly reduced financial products rundown book and lower volumes from interest rate and FX hedging trading desks. This was partially offset by higher equity trading income from customer flow. Trading income from balance sheet management and other trading activities decreased to £14.2 million (2024:£27.1 million) reflecting lower gains from the unwind of certain interest rate swap hedges as part of the implementation of the structural interest rate hedging programme relative to the prior year. Other operating income Other operating income mainly consists of income earned on operating lease rentals. Expected credit loss impairment charges Total ECL impairment charges totalled £97.0 million (2024: £86.0 million), resulting in a credit loss ratio of 60bps (2024: 58bps), in line with guidance provided during the year. The increase in ECL charges was largely driven by Stage 3 ECL charges on certain exposures. We have seen no evidence of trend deterioration in the overall credit quality of our books. Stage 3 exposures remained stable at 3.3% of gross loans subject to ECL (2024: 3.3%). We have seen a reduction in exposures migrating into Stage 3. | | | | --- | --- | | | | | | Refer to pages [252](#i447e4d363cd344738300acdd42f0e3a0_493) for further information on asset quality and page [253](#i8683aa45f40141da8629043c9d38f60b_7966) for a breakdown of the expected credit loss impairment charges. | 30 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | FINANCIAL REVIEW CONTINUED | | | | | | Operating costs Operating costs decreased by 4.6% to £597.7 million (2024: £626.7 million). Fixed operating cost growth reflects investment in technology platforms and strategic projects to enable future growth as well as inflationary pressure. The prior year includes a £30 million motor finance provision. Variable remuneration decreased in line with business performance. The cost to income ratio improved to 50.2% (2024: 52.5%). The various components of operating costs are analysed below: | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | £’000 | 31 March 2025 | % of operating costs | | 31 March 2024 | % of operating costs | % change | | | Staff costs (including directors' remuneration) | 419 115 | 70.1% | | 428 575 | 68.4% | (2.2%) | | | Premises expenses (including depreciation) | 27 156 | 4.5% | | 28 560 | 4.5% | (4.9%) | | | Equipment expenses (excluding depreciation) | 48 152 | 8.1% | | 50 813 | 8.1% | (5.2%) | | | Business expenses | 84 002 | 14.1% | | 106 306 | 17.0% | (21.0%) | | | Marketing expenses | 13 129 | 2.2% | | 9 352 | 1.5% | 40.4% | | | Depreciation, amortisation and impairment of equipment and intangibles | 6 165 | 1.0% | | 3 126 | 0.5% | 97.2% | | | Operating costs | 597 719 | 100.0% | | 626 732 | 100.0% | (4.6%) | | The following table sets out information on operating costs by division for the year under review: | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | £’000 | 31 March 2024 | % of operating costs | | 31 March 2024 | % of operating costs | % change | | | Wealth & Investment | 15 366 | 2.6% | | 14 178 | 2.2% | 8.4% | | | Private Banking | 47 860 | 8.0% | | 49 863 | 8.0% | (4.0%) | | | Corporate, Investment Banking and Other | 534 493 | 89.4% | | 562 691 | 89.8% | (5.0%) | | | Operating costs | 597 719 | 100.0% | | 626 732 | 100.0% | (4.6%) | | | | | | | --- | --- | --- | | | | | | % of operating costs | | | | 31 March 2025 £597.7 million total operating costs | | 31 March 2024 £626.7 million total operating costs | ![4003]() ![4005]() | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | Staff costs | 70.1% | | | Staff costs | 68.4% | | | Business expenses | 14.1% | | | Business expenses | 17.0% | | | Equipment expenses (excluding depreciation) | 8.1% | | | Equipment expenses (excluding depreciation) | 8.1% | | | Premises expenses (including depreciation) | 4.5% | | | Premises expenses (including depreciation) | 4.5% | | | Marketing expenses | 2.2% | | | Marketing expenses | 1.5% | | | Depreciation, amortisation and impairment of equipment and intangibles | 1.0% | | | Depreciation, amortisation and impairment of equipment and intangibles | 0.5% | 31 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | FINANCIAL REVIEW CONTINUED | | | | | | Adjusted operating profit As a result of the foregoing factors, adjusted operating profit increased by 3.4% from £480.4 million to £496.8 million. Taxation on operating profit before acquired intangibles and strategic actions The pro-forma effective operational tax rate increased from 23.4% to 18.9%. For further details on the statutory effective operational tax rate, refer to page [157](#i447e4d363cd344738300acdd42f0e3a0_313). | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | £'000 | 2025 | | 2024 | | 31 March 2025 £'000 | | 31 March 2024 £'000 | % change | | | Taxation on operating profit before acquired intangibles and strategic actions | 18.9% | | 23.4% | | 80 222 | | 96 956 | (17.3%) | | #### Balance sheet analysis Since 31 March 2024: • Total equity increased by 1.8% to £3.7 billion (2024: £3.6 billion), as a result of the increase in retained income • Total assets decreased by 0.3% to £29.7 billion (2024: £29.8 billion); loan book growth of 1.4% was offset by a reasonable decrease in cash and near cash balances from £9.7 billion to £9.1 billion • Total liabilities decreased by 0.6% to £26.1 billion (2024: £26.2 billion); an increase in customer accounts (deposits) was offset by a decrease in deposits by banks. 32 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | UK and Other | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SPECIALIST BANKING OVERVIEW | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | Ruth-Leas_New.png | | | | | Ruth Leas, Business Head | | | | | | | | Awards | | | | Ranked first among UK banks in The Banker’s Top 1000 World Banks 2024 | | | | Financial Times and Statista 2025 UK Best Employer Survey – Ranked in the top 100 of employers | | | | Ranked in the Global Top 100 Most Sustainable Corporations by Corporate Knights | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Adjusted operating profit | Net core loans | Cost to income | Credit loss ratio | | | £424.5mn (2024: £409.7mn) | | £16.8bn (2024: £16.6bn) | | 52.8% (2024: 55.3%) | | 0.60% (2024: 0.58% ) | | | | | | | | | | | | #### Performance #### overview • Pre-provision adjusted operating profit increased by 5.2% to £521.6 million. Adjusted operating profit increased by 3.6% to £424.5 million (2024: £409.7 million). Our established client franchises in the UK mid market and selected geographies performed well in a volatile macro-economic environment. We have continued to execute our client acquisition and entrenchment strategies as we focus on building scale and growing market share • Net core loans grew by 1.4% to £16.8 billion driven by growth in the UK residential mortgage loan book, while the corporate lending portfolio remained flat in a constrained operating environment. Moderate growth across various corporate lending portfolios was offset by higher levels of repayments. Lending activity improved relative to the prior year, resulting in higher originations amid an uncertain environment • Operating income decreased by 0.5%. Growth in net fee income generated from both our Corporate and Investment Banking lending franchises and M&A Advisory business, in line with our strategy to grow capital light earnings, was offset by lower net interest income and lower trading income from customer flow. Investment income contributed positively to revenue • The cost to income ratio improved to 52.8% (2024: 55.3%). Total operating costs decreased by 4.9%. Fixed costs increased by 4.4% excluding the impact of the £30 million motor finance provision raised in the prior year, reflecting investment in technology and strategic projects to enable future growth, as well as inflationary pressure. Variable remuneration decreased in line with business performance • ECL impairment charges totalled £97.0 million, resulting in a credit loss ratio of 0.60% (2024: 0.58%), in line with guidance. The increase in ECL charges was largely driven by Stage 3 ECL charges on certain individual exposures. Overall asset quality of the book remained stable with no evidence of trend deterioration • The Bank maintained strong capital and liquidity levels and we are well positioned to navigate an uncertain macro-economic environment and pursue long-term growth • To date we have established a solid foundation and demonstrated strong performance evidenced by our three-year (i.e. post COVID-19) adjusted operating profit compound annual growth rate (CAGR) of 28.4%. We are investing strategically in both our Private and Corporate transactional banking capabilities to complement our existing core specialisations. #### Income statement | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’000 | 31 March 2025 | 31 March 2024 | Variance | % change | | Net interest income | 783 080 | 820 618 | (37 537) | (4.6%) | | Net fee and commission income | 171 106 | 154 212 | 16 894 | 11.0% | | Investment income | 41 810 | 2 623 | 39 187 | >100.0% | | Share of post-taxation profit of associates and joint venture holdings | 3 233 | 274 | 2 959 | >100.0% | | Trading income arising from | | | | | | – customer flow | 83 750 | 101 059 | (17 309) | (17.1%) | | – balance sheet management and other trading activities | 14 282 | 27 781 | (13 499) | (48.6%) | | Other operating income | 6 676 | 2 915 | 3 761 | >100.0% | | Operating income | 1 103 937 | 1 109 481 | (5 544) | (0.5%) | | Expected credit loss impairment charges | (97 024) | (86 001) | (11 023) | 12.8% | | Operating income after expected credit loss impairment charges | 1 006 913 | 1 023 480 | (16 568) | (1.6%) | | Operating costs | (582 353) | (612 554) | 30 201 | (4.9%) | | Operating profit before goodwill, acquired intangibles and strategic actions | 424 560 | 410 926 | 13 633 | 3.3% | | Loss attributable to non-controlling interests | (12) | (1 204) | 1 192 | — | | Adjusted operating profit | 424 548 | 409 723 | 14 825 | 3.6% | 33 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | UK and Other | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SPECIALIST BANKING OVERVIEW CONTINUED | | | | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Enhanced collaboration through our commitment to ‘One Investec’ A key strategic differentiator is our connected client ecosystem, which delivers a coordinated and holistic approach to addressing our clients’ personal and business banking needs. Our business activities are structured around target client groups, enabling us to bring all of Investec that is relevant to each and every client and to foster meaningful and long-lasting client relationships. In the corporate mid market our breadth of capabilities and solution-oriented approach sets us apart. In the Private Client market, our exceptional levels of service attract HNW individuals underserved by traditional high street and private banks. We remain committed to deepening our existing client relationships, expanding our client networks to connect like- minded clients across Investec and identifying ‘One Investec’ opportunities that will enhance our scale and relevance across our connected client ecosystem. | | In FY2025 In line with our objective to increase connectivity, there has been a significant drive to cultivate collaboration between our Corporate and Private Client groups. Our Private C lient group referred 226 opportunities to our Corporate C lient group in the current period (2024: 223). Our Corporate Client group referred 221 opportunities to our Private Client group (2024: 234). We have also seen consistent collaboration within the Corporate Client group with referrals between teams increasing to 558 from 552 in FY2024. Going forward As part of the long-term strategic partnership and cooperation agreement between Investec and Rathbones, we will continue to collaborate with Rathbones to enhance the proposition across banking and wealth management services. Providing our clients with a holistic solution remains a priority. | | | | | | | | | | | | --- | --- | | | | | Diversified loan book by risk category: Core loans | | ![34634616286986]() | | | | | | --- | --- | --- | --- | | | | | | | | | Mar 25 | Mar 24 | | Corporate and other lending | | 51% | 50% | | | Asset finance | 16% | 16% | | | Corporate and acquisition finance | 13% | 14% | | | Fund finance | 9% | 8% | | | Energy and infrastructure finance | 4% | 4% | | | Other corporate and financial institutions and governments | 4% | 4% | | | Aviation finance | 3% | 2% | | | Asset-based lending | 2% | 2% | | Lending collateralised by property | | 14% | 15% | | | Commercial real estate | 9% | 10% | | | Residential real estate | 5% | 5% | | High net worth and other private client lending | | 35% | 35% | | | Mortgages | 31% | 30% | | | Other high net worth lending | 4% | 5% | Highlights: Sustainability • As part of our commitment to achieving net zero by 2050, the Investec Group set a five-year target to facilitate £18 billion of sustainable and transition finance by 2030. Our business aims to contribute £14.9 billion towards this target, driving investments that support environmental and social outcomes • We successfully achieved our target of zero coal exposure in the Investec plc loan book as of September 2024, ahead of our initial timeline of 31 March 2027 • We provided c.£100 million financing for a renewable energy developer to acquire a biomass renewable plant • We arranged a €65 million financing package for a Dutch electric vehicle (EV) charging business, and co-arranged a $150 million Green Loan for an EV charging infrastructure business in the US • In support of SDG 10: Reduced inequalities, we launched the Career Catalyst programme with our community partner, Arrival, to support unemployed and underemployed young adults in their transition from education to the workforce. Highlights: belonging, inclusion and diversity (BID) • We are making steady progress in closing our diversity pay gaps. As at 5 April 2024, the mean hourly gender pay gap in our UK banking business decreased to 20.5% from 22.3% the previous year • We have entered into a new partnership with an organisation to increase the representation of Black professionals at all levels within our organisation • We are a Disability Confident employer, taking action to enhance our recruitment, retention and development for people living with disabilities. This commitment includes partnering with an internship programme that offers placements for disabled students and recent graduates • Throughout the year, we hosted various talks and events to promote BID, such as menopause awareness sessions, Black History Month celebrations and an International Women’s Day campaign where we partnered with a non-profit organisation fighting clothes poverty for vulnerable men, women and children. 34 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | UK and Other | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRIVATE BANKING | | | | | | Our Private Banking activities focus on providing bespoke solutions underpinned by in-depth knowledge and understanding of our clients’ personal and business aspirations and goals, supported by a broad private banking offering. We understand that every client is an individual, and that they are typically active wealth creators with complex financial needs. Our proposition is aligned with a clearly defined target client base and a market opportunity to address an underserviced part of the UK market. This segment comprises lending (primarily residential mortgages), savings and transactional banking (including international payments) to HNW clients, coupled with bespoke foreign exchange and financing solutions for qualifying HNW clients. Performance overview • Adjusted operating profit for the year amounted to £47.1 million (2024: £58.7 million), primarily reflecting lower net interest income driven by higher cost of funding. This was partially offset by a 4.0% decrease in operating costs • The UK residential mortgage lending book reported positive growth of 4.8% since March 2024, a solid performance given the elevated interest rate and uncertain macro-economic environment. | | | | | --- | --- | --- | | | | | | | | | | | Loans and advances to customers | | | | £’billion | | ![34634616281802]() | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Banking (primarily mortgages) | | | | | | | | | | | | | | | | | | --- | --- | --- | | | | | | | | | | | Loan book growth: | | | | • The UK HNW banking book grew 3.7% since March 2024 amidst a challenging macro backdrop, demonstrating the strength of our value proposition and active client engagement • Demand for our residential mortgage lending has been affected by subdued activity in the prime Central London market due to elevated interest rates, negative sentiment following last year’s autumn budget, and ongoing macro-economic uncertainty • Credit underwriting standards continue to be maintained whilst growing the book notwithstanding a competitive market. | | | | Notes: Following a strategic review, our Private Capital business, previously reported as part of this Private Banking segment, is now reported in the Corporate, Investment Banking and Other segment. The chart above only includes residential mortgages. Refer to page [36](#i447e4d363cd344738300acdd42f0e3a0_127). In addition to the loan book shown above, our Channel Islands business had c.£532 million (Mar 2024: £521 million) of mortgages as at 31 March 2025. | | | | | | | | | | | --- | --- | --- | | | | | | | | | | | UK HNW client acquisition | | | | | | ![34634616281813]() | | | | | --- | --- | --- | | | | | | | | | | | | | | | Continued success in client acquisition: | | | | • We acquired 880 new clients over the period, in part driven by referrals from existing Investec clients • Aligned to our One Investec approach, this offering serves as a valuable client acquisition tool for the wider UK Bank and strategic partnership with Rathbones Group. Our clients have an average income of £700 000+ and average NAV of £12 million (well above our quantitative criteria) • HNW mortgage lending is focused on target clients in established areas (London and the South East) with recourse to the individual and high level of cash equity contributions into transactions. | | | | Note: In addition to these client figures, our Channel Islands business has 1 138 HNW clients (31 March 2024: 1 092). This brings our total number of HNW clients to 8 663 (31 March 2024: 8 127). | | | | | | 35 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | UK and Other | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRIVATE BANKING CONTINUED | | | | | | #### Income statement analysis and key income drivers | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’000 | 31 March 2025 | 31 March 2024^ | Variance | % change | | Net interest income | 96 639 | 107 268 | (10 629) | (9.9%) | | Net fee and commission income | 960 | 773 | 187 | 24.2% | | Trading income arising from | | | | | | – customer flow | 3 018 | 4 869 | (1 851) | (38.0%) | | – balance sheet management and other trading activities | (47) | (49) | 2 | 4.1% | | Operating income | 100 570 | 112 861 | (12 291) | (10.9%) | | Expected credit loss impairment charges | (5 582) | (4 260) | (1 321) | 31.0% | | Operating income after expected credit loss impairment charges | 94 988 | 108 601 | (13 613) | (12.5%) | | Operating costs | (47 860) | (49 863) | 2 003 | (4.0%) | | Adjusted operating profit/(loss) | 47 128 | 58 738 | (11 610) | (19.8)% | | Key income drivers | | | | | | Cost to income ratio | 47.6% | 44.2% | | | | Growth in loans and advances to customers | 3.7% | 3.2% | | | ^Following a strategic review, Private Capital business, previously reported as part of this Private Banking segment is now reported as part of our Corporate, Investment Banking and Other segment, details of which can be found on pages [36](#i447e4d363cd344738300acdd42f0e3a0_127) to [38](#i6584cd0dc59e425db61b21288839b6a8_16357). The comparative period has been restated to reflect this change. Overview of financial performance • Net interest income declined; higher average lending books were offset by lower average interest rates and higher funding costs as deposits repriced • ECL impairment charges for the year increased to £5.6 million (2024: £4.3 million) driven by an increase in Stage 1 and Stage 2 modelled ECLs as a result of the implementation of revised IFRS 9 models. Asset quality remains solid with exposures well covered by collateral, as reflected in the low coverage ratios. Refer to page [143](#i447e4d363cd344738300acdd42f0e3a0_283) for further information on the Group's asset quality • Operating costs decreased by £2.0 million or 4.0%, driven by lower variable remuneration in line with business performance. Fixed costs growth of 8.1% reflects inflationary pressure as well as investment in people and technology to enable future growth. Strategy execution • We have continued to successfully execute our HNW client acquisition strategy. Whilst activity levels remain subdued given current market conditions, we were still able to grow our Private Banking franchise • This HNW client activity connects to our broader client ecosystem, through the client-centric ‘One Investec’ approach, and enables us to win mandates in other areas. We are seeing a consistent number of internal referrals from our Private Client group to our Corporate Client group • We continue to collaborate with Rathbones to enhance the proposition across banking and wealth management services. In FY2025, our referrals to Rathbones allowed them to successfully generate new FUM for the Rathbones Group from our client base against a challenging market backdrop • Our ability to provide UK Private Banking solutions to South African clients seeking an international proposition remains a key differentiator in South Africa. Looking ahead • We are focused on maintaining business momentum and generating a stable annuity income stream for the Group, while investing with discipline in the required technology to support our growth to scale • We are advancing our UK Private Client business, transitioning from a predominantly lending-led strategy to a comprehensive banking approach that deepens client engagement within our ecosystem. Our investment into building a Private Client transactional platform will enable us to deliver a full product suite offering, including multi-currency accounts and credit cards, while enhancing our lending capabilities. This investment phase will span three years, with a positive contribution to Group ROTE and ROE expected from FY2029. In addition, we expect to more than double our current market share of c.8% by FY2030. 36 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | UK and Other | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CORPORATE INVESTMENT BANKING AND OTHER | | | | | | This segment comprises business activities that provide lending, advisory and risk management services to growth-orientated corporate clients in the private companies, private equity and listed companies arenas, including specialist sector-focused expertise. This segment also includes our central treasury and liability management channels. #### Performance overview • The results reflect a good performance in a challenging and uncertain macro-economic environment. Pre-provision adjusted operating profit increased by 8.4%, with adjusted operating profit of £377.4 million being 7.5% ahead of the prior year. We have continued to successfully execute client acquisition strategies to build scale and relevance in the markets in which we operate • Net interest income decreased by 3.8% to £686.4 million, as larger average interest-earning assets were offset by lower average interest rates and higher funding costs as deposits repriced • Non-interest revenue grew by 11.9%, predominantly driven by growth in net fees and commissions and investment income over the year • Impairment charges increased to £91.4 million (2024: £81.7 million). We have seen individual client stresses with no evidence of trend deterioration in the overall credit quality of the book. | | | --- | | | | Loans and advances to customers | | £’billion | ![34634616278938]() | | | --- | | | | Loan book growth | • The loan book increased 0.4% to £11.6 billion • Growth in our diversified lending portfolios was offset by elevated levels of repayments across the corporate loan book • We continue to utilise our origination and distribution capability to manage diversity and concentration of our lending portfolios and generate additional ROTE-accretive revenue for the Group. | | | | | --- | --- | --- | | | | | | | | | | | Spotlight on our Fund Solutions offering • Our Fund Solutions business creates holistic and bespoke solutions for Funds and General Partner (GP) Financing covering each stage of the fund lifecycle • We partner and grow with a range of institutional investors building strong relationships in the market. This enables us to be relevant to various funds and to provide them with the support and flexibility needed to seize opportunities, deliver returns and generate value • Our Fund Solutions business is central to achieving our key strategic objective of growing external sources of capital and capital light revenue streams. Many of our Fund Solutions clients are also clients of other areas of the bank • Through the business, we provide investors with access to the private funds management industry, utilising our market-leading position and expertise to simultaneously meet both investor and borrower needs • Structured solutions that provide mutual benefits are the hallmark of our capability. During the year, the team partnered with bank, pension and insurance investors to provide c.£5.8 billion (2024: c.£4.8 billion) of lending facilities to fund managers • The business has partnered with Ares Management, a leading global alternative investment manager, to provide subscription line facilities to our fund clients in our key markets such as the UK, Continental Europe and the US. This innovative and scalable funding agreement enables us to meet the growing demand for subscription line facilities in the mid market, enhancing our client-led approach to financing • Looking ahead, the Fund Solutions business remains focused on unlocking further growth and prioritising our clients’ funding needs in everything we do. | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Awards won in the past year | | | | | | | | | | | | | | | | | | Ranked within the Top 5 European Direct Lenders Debtwire 2024 European Direct Lender Rankings | | | | #1 UK Small & MidCap Broker (Second consecutive year) Institutional Investor Extel Survey 2024 | | | | Best Business FX Provider Business Moneyfacts Awards 2024 | | | | Best Transparent Savings Provider (Four years running) Moneynet Awards 2024 | | Best Digital Savings Provider and Best Notice Savings Provider Moneynet Awards 2025 | | | | | | | | | | | | | | | | | | 37 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | UK and Other | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CORPORATE, INVESTMENT BANKING AND OTHER CONTINUED | | | | | | #### Income statement analysis and key income drivers | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’000 | 31 March 2025 | 31 March 2024 | Variance | % change | | Net interest income | 686 441 | 713 349 | (26 908) | (3.8%) | | Net fee and commission income | 170 146 | 153 439 | 16 707 | 10.9% | | Investment income | 41 810 | 2 623 | 39 187 | >100.0% | | Share of post-taxation profit of associates and joint venture holdings | 3 233 | 274 | 2 959 | >100.0% | | Trading income arising from | | | | | | – customer flow | 80 732 | 96 190 | (15 457) | (16.1%) | | – balance sheet management and other trading activities | 14 329 | 27 830 | (13 501) | (48.5%) | | Other operating income | 6 676 | 2 915 | 3 761 | >100% | | Operating income | 1 003 367 | 996 620 | 6 747 | 0.7% | | Expected credit loss impairment charges | (91 442) | (81 741) | (9 701) | 11.9% | | Operating income after expected credit loss impairment charges | 911 925 | 914 879 | (2 954) | (0.3%) | | Operating costs | (534 493) | (562 691) | 28 198 | 5.0% | | Operating profit before goodwill, acquired intangibles and strategic actions from continuing operations | 377 432 | 352 188 | 25 244 | 7.2% | | Profit attributable to non-controlling interests | (12) | (1 204) | 1 192 | (99.0%) | | Adjusted operating profit | 377 420 | 350 984 | 26 436 | 7.5% | | Key income drivers | | | | | | Cost to income ratio | 53.3% | 56.5% | | | | Growth in loans and advances to customers | 0.4% | 8.6% | | | Note: Following a strategic review, our Private Capital business previously reported as part of our Private Banking segment is now reported in the above income statement of our Corporate, Investment Banking and Other segment. The comparative period has been restated to reflect this change. Overview of financial performance • Net interest income decreased by 3.8% as the effects of a higher average loan book were offset by higher average cost of deposits and lower average interest rates. Our differentiated client lending franchises allowed us to continue growing notwithstanding the uncertain operating environment that prevailed over the year. Our client acquisition strategies are the key underpin to the sustained loan book growth across diversified specialisations • Net fee and commission income increased by 10.9% to £170.1 million. This growth was driven by higher lending fees driven from increased client activity. We have also seen higher advisory fees primarily from our Continental European M&A Advisory business (formerly ‘Capitalmind’), reflecting both strong performance and the impact of a full year of consolidated earnings as it became a subsidiary in June 2023 • Higher investment income was largely driven by fair value gains from equity investments • Trading income from customer flow decreased by 16.1% as a result of non-repeat prior year gains from hedging the significantly reduced financial products rundown book and lower volumes from interest rate and FX hedging trading desks. This was partially offset by higher equity trading income from customer flow • Trading income from balance sheet management decreased, primarily driven by lower gains from the unwind of certain interest rate swap hedges as part of the implementation of the structural interest rate hedging programme relative to the prior year • ECL impairment charges increased to £91.4 million. The increase in ECL charges was largely driven by Stage 3 ECL charges on certain individual exposures. Overall asset quality of the book has remained stable with no evidence of trend deterioration in the book. We have seen a reduction in exposures migrating into Stage 3. Refer to page [267](#i447e4d363cd344738300acdd42f0e3a0_502) for further information on the macro- economic scenarios applied and page [252](#i447e4d363cd344738300acdd42f0e3a0_493) for information on the Group's asset quality • Operating costs decreased by 5.0% to £534.5 million. The increase in fixed costs, excluding the impact of the £30 million motor finance provision raised in the prior year, reflected investment in technology and strategic projects to enable future growth, as well as inflationary pressure. Variable remuneration decreased in line with business performance. 38 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | UK and Other | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CORPORATE, INVESTMENT BANKING AND OTHER CONTINUED | | | | | | Strategy execution • Our ‘One Investec’ approach – underpinned by our connected client ecosystem – enables us to provide holistic solutions and generate new opportunities for clients. Our continued partnership with Rathbones enhances collaboration to ensure a seamless experience for mutual clients • We continued to successfully execute our client acquisition strategies to build scale and relevance in the UK and other markets in which we operate. As at 31 March 2025, we had c.2.1k corporate clients and c.137k asset finance group clients • Our deposit-raising franchise continues to deliver value to our c.840k retail deposit clients, providing a funding channel for our lending specialisations • We have enhanced our proposition to private companies through continued digitisation across key areas including FX and lending. This has led to an increase in client numbers and their usage of our products • Following the successful launch of the Discretionary Capital line with Ares Management (‘Ares’), noted as the “first of its kind” in the market, our Fund Solutions team continues to explore further synergies for both Ares and Investec • Our successful origination and distribution capabilities enable us to increase revenue contribution from capital light activities by utilising external capital for larger credit underwriting. Investec Alternative Investment Management (‘IAIM’), a subsidiary of IBP, houses our fund activities, including Private Debt Fund I (launched early 2021) and Private Debt Fund II (first close in mid-2024 with a further close at the end of 2024) • We continue to deepen our mid-market relevance with a comprehensive proposition and focused target market. Our Direct Lending franchise recently expanded its Asset Based Lending offering into Continental Europe. This has gained traction with strong deal flow in 2H2025 • Our Continental European M&A Advisory colleagues have rebranded to the ‘Investec’ name and logo from ‘Capitalmind Investec’, aligning with our strategy to proactively grow in Europe. This year, we successfully executed a landmark cross-border deal with South Africa, advising on the strategic sale of Holdsport from Old Mutual Private Equity. Additionally, we have further enhanced our UK plc M&A team’s capabilities through a series of senior hires and expanded our advisory presence to the Nordic region, alongside our presence in France, Germany and the Benelux • Investec India’s strategy aligns with the Group’s strategy to increase contribution from capital light revenues. Our equities business and our M&A Advisory business have strong market presence in target sectors • Our India private credit business has arranged over $6.6 billion debt for India counterparts since inception and has launched a second fund in Gujarat International Finance Tec-City (GIFT) • Our global capability centre in Mumbai continues to support both client-facing and business enablement functions for the UK and South Africa. Looking ahead • The global macro-economic environment is facing heightened uncertainty, creating volatility in economic forecasts and financial markets. Our strong capitalisation, low leverage and robust liquidity ratios are well above our Board- approved minimums. We are well positioned to manage the impacts of external challenges, continue supporting our clients to navigate the current economic uncertainty, as well as pursue identified growth areas and levers outlined below • We continue to grow market share and see positive growth prospects in our private markets businesses within Investment Banking. Our M&A Advisory business is positioned for growth. This growth is expected to be driven by increasing scale and geographic reach, our focus on targeted sectors, as well as growing contributions from the Coverage and Origination team • We are actively pursuing growth opportunities in Continental Europe through a coordinated approach. We are deepening our Lending and Advisory capabilities in existing regions and are exploring selective new markets. Our Zurich-based lending origination team is focused on driving growth in the DACH region, while our Treasury Risk Solutions business has established a new representative office in the Netherlands. These initiatives bring us closer to sponsors and borrowers, unlocking new opportunities for growth • We see opportunity to grow market share and drive income as we further develop our offering to private companies. We are transitioning to end-to-end relationship banking, by incorporating transactional banking capabilities into our existing proposition. There is an opportunity to create significant value for the Bank by leveraging our strengths in high-touch support and sector expertise to enhance our mid- market offering. We plan to invest in this capability over the next three years, with breakeven expected by FY2029 and a positive contribution to ROTE and ROE anticipated from FY2030 • We remain committed to building a leading mid-market Alternative Investments platform. We are focused on raising further capital to complement our balance sheet lending capabilities • We expect to see further growth in our global capability centre as it increases in importance and relevance throughout the Group • Investec plc is progressing in the journey to migrate its capital management to the Internal Ratings Based (IRB) approach • We are committed to meeting our 2030 sustainable and transition finance target as we continue to embed sustainability into our strategic execution processes • We are committed to growth and delivering exceptional experiences for clients and employees while prioritising digital security for Investec plc and our stakeholders. By focusing on digitalisation, leveraging cloud technologies and the advancements in Generative AI, we will continue to enhance efficiency and productivity, positioning Investec plc as an industry leader in an evolving market. 39 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 02 | | Financial review | UK and Other | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | WEALTH AND INVESTMENT | | | | | | ![]() ![Rathbones_BOX.jpg]() ![]() | | | | | | --- | --- | --- | --- | | | | | | | | | | | | | UK’s leading discretionary wealth manager with c.£104.1bn FUMA | | Scale and operating efficiencies to power future growth | It has always been central to Investec’s strategy to provide a coordinated banking and wealth management offering. Prior to the combination with Rathbones, IW&I UK was consistently one of the leading private client wealth managers in the UK and a highly respected franchise in the industry. At the end of 1H2024 an all-share combination of IW&I UK and Rathbones was completed, resulting in the Investec Group owning a 41.25% economic interest in the combined Rathbones Group, and creating the UK’s leading discretionary wealth manager. Rathbones Group reported FUMA of £104.1 billion as at 31 March 2025. The combination brought together two reputable UK wealth management businesses with closely aligned cultures and operating models and established a long-term, strategic partnership which enhances the client proposition across banking and wealth management services for both groups. The combination represents a significant value-creation trajectory for all stakeholders. IW&I UK was 100% consolidated in the first half of the prior year. In the second half of the prior year and in the current year the Group's investment in Rathbones has been equity accounted for and recognised as an associate. The prior year statutory financial statements have been presented in accordance with IFRS 5, i.e. the Group’s interest in IW&I UK in the prior year has been presented as a discontinued operation. In the below table, the prior year has been presented on a pro-forma basis, i.e. the 100% consolidated IW&I UK earnings in 1H2024 have been presented post tax on the income from associate line. Refer to page [38](#i447e4d363cd344738300acdd42f0e3a0_133) for further pro-forma information. #### Income statement analysis and key income drivers | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’000 | 31 March 2025 | 31 March 2024 | Variance | % change | | Share of post-taxation profit of associates and joint venture holdings | 69 147 | 66 869 | 2 278 | 3.4% | | Adjusted operating profit | 69 147 | 66 869 | 2 278 | 3.4% | | Share of integration costs incurred by Rathbones | (27 987) | (9 631) | | | | Equity-accounted amortisation of acquired intangibles^ | (6 313) | (12 624) | | | | Profit after tax | 34 847 | 44 614 | | | | Key income drivers | | | | | | Post-tax ROE | 20.0% | 21.6% | | | | Post-tax ROTE | 27.4% | 34.6% | | | ^ During the current year, the assessment of the purchase price allocation for Rathbones was completed. The current year equity accounted amortisation of intangibles figure includes an adjustment to align the cumulative amortisation to date to the value of intangibles per this valuation exercise. Excluding the current year cumulative adjustment, the current year figure would have been £12.6 million and is expected to remain around this level for the foreseeable future. The financial year under review In 1H2024 (pre the combination) the IW&I UK business generated adjusted operating profit (post tax) of £35.9 million and an operating margin of 25.2%. In 2H2024 (post combination) the Group’s 41.25% economic interest in Rathbones was equity accounted, reporting £31.0 million share of post-taxation profit of associates resulting in £66.9 million recognised as post-taxation operating profit from associate on a pro-forma basis in the prior year. The current year consists of the Group's 41.25% share of Rathbones’ post-tax underlying profit attributable to shareholders for their year ended 31 December 2024 of £167.6 million, which amounts to £69.1 million. Rathbones reported underlying operating margin of 25.4% for the year to 31 December 2024 (2023: 22.3%), showing progress towards the target of a 30%+ margin. Rathbones reported cost and revenue synergies well ahead of the first year £15 million target, with run-rate synergy realisation of £30.1 million reported at 31 December 2024. We remain confident that the combination will deliver scale and efficiency to deliver future long-term growth. | | | --- | | | | | #### Investec Bank (Switzerland) AG (IBSAG) IBSAG, which houses our Swiss wealth business, is a wholly-owned subsidiary of IBP. IBSAG generated revenue of £18.5 million in the current year (2024: £18.0 million), an adjusted operating profit of £3.1 million (2024: £3.8 million) and reported funds under management of £2.7 billion (2024: £2.1 billion). Following a strategic review in 2022, our Swiss wealth business has been earmarked to play a key role in the Investec Group’s strategic expansion of its international wealth services. As a result further information regarding this business can be found in the Investec Group’s Southern African Wealth & Investment division in the Group’s integrated report. 40 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | 03 | | | ## Risk ## management ## and governance IN THIS SECTION | | | | --- | --- | | | | | [42](#i447e4d363cd344738300acdd42f0e3a0_175) | Risk management | | | | | [42](#i447e4d363cd344738300acdd42f0e3a0_175) | Risk management approach and framework | | | | | [43](#i447e4d363cd344738300acdd42f0e3a0_178) | Year in review from a risk perspective | | | | | [45](#i447e4d363cd344738300acdd42f0e3a0_181) | Principal risks | | | | | 61 | Corporate Governance | | | | | 61 | Chair’s introduction | | | | | 63 | Director Biographies | | | | | 66 | Compliance with the UK Corporate governance code | | | | | 67 | Board and executive roles | | | | | 69 | Board activities | | | | | 71 | IBP Nomination Committee report | | | | | 75 | IBP Audit Committee report | | | | | 83 | IBP Board Risk and Capital report | | | | | 88 | Directors’ report | | | | 41 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | | | | #### Our risk management culture #### ensures we are locally responsive yet globally aware. This section #### contains our risk management #### and Corporate Governance #### disclosures. 42 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | RISK MANAGEMENT APPROACH AND FRAMEWORK | | | | | | Information provided in this section of the annual report is prepared on an Investec Bank plc (IBP) consolidated basis unless otherwise stated. P #### hilosophy and a #### pproach to risk #### management The Bank's comprehensive risk management process involves identifying, quantifying, managing, monitoring, mitigating and reporting the risks associated with each of the businesses to ensure the risks remain within the stated risk appetite. The Board ensures that there are appropriate resources to manage the risks arising from running our businesses. The IBP Board Risk and Capital Committee (IBP BRCC) (comprising both executive and non-executive directors) is the Board mandated committee to monitor and oversee risk. IBP BRCC meets four to six times per annum and recommends the overall risk appetite to the Board for approval. We monitor and control risk exposure through independent credit, market, liquidity, operational, legal, internal audit, capital and compliance teams. This approach is core to assuming a tolerable risk and reward profile, helping us to pursue controlled growth across our business. Risk management operates within an integrated geographical and divisional structure, in line with our management approach, ensuring that the appropriate processes are used to address all risks across the Bank. There are specialist divisions in the UK and smaller risk divisions in other regions tasked with promoting sound risk management practices. Risk management units are locally responsive yet globally aware. This helps to ensure that all initiatives and businesses operate within our defined risk parameters and objectives. We continually seek new ways to enhance risk management techniques. We believe that the risk management systems and processes we have in place are adequate to support the Bank’s strategy and allow the Bank to operate within its risk appetite tolerance. Risk management objectives are to: • Ensure adherence to our risk management culture • Support the long-term sustainability of the Bank by providing an established, independent framework for identifying, evaluating, monitoring and mitigating risk with good customer outcomes • Set, approve and monitor adherence to underlying risk parameters and limits across the Bank and ensure they are implemented and adhered to consistently within the Board-approved risk appetite • Aggregate and monitor exposure across risk classes • Maintain compliance in relation to regulatory requirements • Coordinate risk management activities across the organisation, covering all legal entities and jurisdictions • Establish and convene appropriate risk committees, as mandated by the relevant Boards • Resource risk teams suitably and with appropriate expertise and facilitate operating independence • Give the IBP Board reasonable assurance that the risks the Bank is exposed to are identified and appropriately managed and controlled. #### Risk management framework, committees #### and forums A number of committees and forums identify and manage risk at a Bank level, as shown in the diagram below. These committees and forums operate together with risk management and are mandated by the IBP Board. Any matters relevant to IBP are communicated to the Bank, in part, through having one or more directors of Investec Group as members of the Board committees of the Bank. | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | IBP Board of Directors | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | IBP Nomination Committee | | | IBP Remuneration Committee | | | IBP Audit Committee | | | IBP Board Risk and Capital Committee (IBP BRCC) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | IBP Reward Committee | | | IBP Impairment Decision Committee | | | IBP Risk and Controls Forum | | | IBP Executive Risk Committee (IBP ERC) | | | IBP Credit Committees | | | IBP Capital Committee | | | IBP Executive Investment Committee | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | IBP Review Executive Risk Review Forum (IBP Review ERRF) | | | IBP Models Forum | | | IBP Product Governance Forum | | | IBP Market Risk Forum | | | IBP Asset and Liability Committee | | | IBP Policies Review Committee | | | IBP New Product and Initiative Forum | | | | | | 43 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | YEAR IN REVIEW FROM A RISK PERSPECTIVE | | | | | | A summary of the year in review from a risk perspective The executive management is integrally involved in ensuring stringent management of risk through our risk appetite framework, and embedding a culture of risk consciousness in all staff. The risk appetite framework is set taking into consideration prevailing market conditions and the Bank’s strategy. The primary aim is to achieve a suitable balance between risk and reward in our businesses. Despite rising geopolitical tensions across the world, we have continued to grow our business in a risk conscious manner and are well placed to navigate the uncertainty that has arisen with respect to the US tariff negotiations and broader global markets volatility. The Bank remains well capitalised, maintains high levels of liquidity, runs modest levels of market risk and favours secured lending to clients with predictable income streams. Loans and advances to customers as a percentage of customer deposits remained conservative at 78.0% (31 March 2024: 79.5%).The Bank has a substantial portion of eligible deposits that are covered by Financial Services Compensation Scheme (FSCS) protection. We have limited reliance on wholesale funding but we maintain access and presence, using wholesale issuance to strategically diversify our funding base and complement the other liability channels by focusing, where appropriate, on tenor and currency as part of a longer term strategic plan. The Minimum Requirements for Own Funds and Eligible Liabilities (MREL) transition will commence from 1 January 2026 in a phased manner with end-state MREL applying from 1 January 2032. Cash and near cash balances at 31 March 2025 amounted to £9.1 billion (31 March 2024: £9.7 billion). We maintain a high level of readily available, high-quality liquid assets (HQLA), targeting a minimum cash to customer deposit ratio of 25%. Current cash and near cash is equivalent to 42.2% of customer deposits (31 March 2024: 46.3%). At 31 March 2025, on an IBP solo basis, the Liquidity Coverage ratio (LCR) was 418% and Net Stable Funding ratio (NSFR) was 144%, both metrics well ahead of current minimum regulatory requirements. We continue to maintain a structural hedging programme in the UK to reduce sensitivity of earnings to interest rate movements. The Bank’s focus remains on maintaining a strong liquidity position as we continue to navigate global markets with heightened levels of volatility. IBP’s long-term Moody’s deposit rating is A1 (stable outlook) and Investec plc’s rating is Baa1 (positive outlook). During the year, IBP’s long-term Fitch rating was upgraded to A- (stable outlook). We have continued to grow our loan book while ensuring its resilience, despite the challenging macro-economic environment. Increased and diversified client activity and new client acquisition resulted in an increase in the Bank's net core loan book by 1.4% to £16.8 billion (31 March 2024: £16.6 billion). Growth was due to increased activity diversified across multiple asset classes of Corporate client lending as well as residential mortgage lending. Credit exposures are focused on secured lending to a select target market, comprising high-income and high net worth individuals, established corporates, and medium-sized enterprises. Our risk appetite continued to favour lower risk, income-based lending, with exposures well collateralised and with credit risk taken over a short to medium term. We remain focused on our target market, supporting clients with significant wealth and experience in their chosen sectors, as indicated by our continued growth in the private banking space as we execute on our strategy to target this sector of the market. Over the past few years we have realigned and rebalanced our portfolios in line with our risk appetite framework and this is reflected in the movements in asset classes on our balance sheet; showing an increase in private client, mortgages and corporate and other lending, and maintaining lending collateralised by property as a proportion of net core loans. Concentration risk is well managed and exposures are spread across geographies and industries. We remain confident that we have a well-diversified portfolio across sectors. The Bank’s net core loan exposures remain well diversified with commercial rent producing property loans comprising approximately 7.5% of net core loans, other lending collateralised by property 6.4%, high net worth and other private client lending 34.7% and corporate and other lending 51.4% (with most industry concentrations well below 5%). Asset quality ratios reflect the current operating environment and underlying portfolios remain resilient. The credit loss ratio is at 0.60% at 31 March 2025 (31 March 2024: 0.58%), in line with guidance provided in November 2024. This was driven by a small number of increased idiosyncratic impairments, in part given higher for longer rates and challenges in achieving anticipated exit valuations. We expect the credit loss ratio to remain elevated around FY25 reported levels in the short term. Stage 3 remained flat at 3.3% of gross core loans subject to ECL at 31 March 2025 (31 March 2024: 3.3%) driven by the resolution of existing defaults and a reduced rate of new defaults. Stage 2 exposures as a proportion of gross core loans subject to ECL decreased to 8.1% at 31 March 2025 (31 March 2024: 8.6%) as underlying portfolios continue to perform. The measurement of ECL under IFRS 9 has increased complexity and reliance on expert credit judgements. Key judgemental areas under IFRS 9 are highlighted in this document and are subject to robust governance processes. Macro-economic scenarios have been updated during the course of the year to reflect the changing landscape, particularly with respect to tariffs and the potential impact of a trade war. The Bank continues to holds a management overlay of £3.7 million at 31 March 2025 (31 March 2024: £3.7 million) which is apportioned to Stage 2 assets. | | | | --- | --- | | | | | | Further detail on key judgements can be found on page [266](#i447e4d363cd344738300acdd42f0e3a0_499) . | 44 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | YEAR IN REVIEW FROM A RISK PERSPECTIVE CONTINUED | | | | | | We continue to progress in entrenching sustainability across all aspects of our business. Our commitment to human rights and support for internationally recognised principles, guidelines and voluntary environmental, social and governance (ESG) standards is tightly integrated into our credit and investment decision-making process which considers the important aspects of each geography we operate in. Following the publication of our enhanced Sustainable and Transition Finance Framework in May 2024, we announced a target to facilitate £14.9 billion of sustainable and transition finance by 2030. Market risk within our trading portfolio remains modest with Value at Risk (VaR) and stress testing scenarios remaining at prudent levels. Trading revenues are driven by client activity. We continue to manage our investment portfolio exposure in line with our objective of optimising capital allocation, reducing income volatility and aligning the business with our client franchises. We have substantially managed down our investment portfolio exposure in line with our objective of optimising capital allocation, reducing income volatility and aligning the business with our client franchises. The investment portfolio on the balance sheet reduced by 13.3% over the year under review to £212 million at 31 March 2025 (31 March 2024: £244 million) The Bank continued to maintain a sound balance sheet with a low gearing ratio of 8.1 times and a core loans to equity ratio of 4.6 times at 31 March 2025. The Bank maintained a sound capital position, well in excess of minimum regulatory requirements, with a Common Equity Tier 1 (CET1) ratio of 13.6% (31 March 2024: 13.3%) and a leverage ratio of 10.5% (31 March 2024: 10.7%). The Bank remains on the Standardised Approach and with these metrics comfortably exceeds the target CET1 ratio of greater than 10% and leverage ratio target of greater than 6%. The Bank is progressing on the journey to migrate its capital management to the Internal Ratings Based (IRB) approach. Non-financial risks that arise through the Bank's operations remain highly topical and continue to receive a significant amount of management time, particularly in light of the evolving technological landscape and regulatory focus. Operational risk is managed across the business through an internal control environment, with a view to limiting the risk to acceptable residual risks. The importance of operational resilience to ensure minimal client disruption is paramount. We take a highly disciplined approach to recovery and resolution planning and actively test our resilience to potential external shocks regularly. The Bank remains focused on managing conduct, reputational and operational risks. Keeping abreast of industry-wide trends with respect to artificial intelligence (AI) developments, cyber threats and data management as well as increased reliance on big tech and cloud platforms remains an area of focus and significant time is spent ensuring we have the appropriate expertise to assess potential threats and opportunities. We remain cognisant of the emerging risks arising from technological advances and continually aim to strengthen and test our systems and controls to mitigate cyber risk and fulfil our moral and regulatory obligations to combat money laundering, fraud and corruption. We continue to offer access to wealth management through our strategic partnership with Rathbones, following completion of the all-share combination of the UK Wealth & Investment business in September 2023. The Partnership Agreement with Rathbones governs the long-term, strategic partnership and is expected to unlock significant value in the medium to long term. The Bank operates in a legal and regulatory environment that exposes it to litigation risks. As a result, the Bank is involved in disputes and legal proceedings which arise in the ordinary course of business. The Bank evaluates all facts, the probability of the outcome of legal proceedings and advice from internal and external legal counsel when considering the accounting implications. The Bank notes the recent Court of Appeal decisions on Wrench, Johnson and Hopcraft relating to motor commission arrangements and the lender’s appeal to the UK Supreme Court which was heard on 1 April to 3 April 2025. Judgement is expected by July 2025. Based on the current available information, the Group has concluded that the provision of £30 million raised in the prior year for the motor commission review still remains appropriate. The Bank began lending in this space in June 2015. There remains significant uncertainty across the industry as to the extent of any misconduct and customer loss that may be identified, and/or the nature, extent and timing of any remediation action that may subsequently be required following the Court of Appeal decision and FCA motor commission review. The Bank notes that the ultimate financial impact of the Court of Appeal decision and ongoing FCA investigation into motor commission could materially vary, pending further guidance from the FCA or the outcome of the appeal to the UK Supreme Court. The Board, through its respective risk and capital committees, continued to assess the impact of its principal risks and the Bank’s stress testing scenarios (including ‘bottom-up’ and reverse stress testing analyses) on its business. The Board has concluded that the Bank has robust systems and processes in place to manage these risks and that, while under a severe stress scenario business activity would be very subdued, the Bank would continue to maintain adequate liquidity and capital balances to support the continued operation of the Bank. During the year, a number of stress scenarios were considered and incorporated into our processes. Fundamental risk performance during the period has been solid and management remains focused on maintaining a sound underlying balance sheet, notwithstanding the macro- economic pressures and uncertainty we continue to face in our areas of operation. Going forward, we continue to navigate ongoing operations with heightened awareness of the global geopolitical outlook, including any potential impact from the US tariff negotiations, changing currency and sovereign risk dynamics and geopolitical tensions across the world. We maintain high levels of liquidity and diversified funding, supported by a strong capital base in line with our risk appetite. This positions us well to support our clients through the period ahead. 45 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS | | | | | | Principal risks are the most material and significant risks we face, which the Board and senior management believe could have an impact on our strategy, operations, financial performance and viability. These risks are summarised in the section that follows, with further information pertaining to the management and monitoring thereof. #### Risk appetite The Bank has a number of Board-approved risk appetite statements and policy documents covering our risk appetite and approach to our principal aspects of risk. The risk appetite framework and statement set out the Board’s mandated risk appetite. The risk appetite framework acts as a guide to determine the acceptable risk profile of the Bank while keeping in line with the Investec Group’s risk appetite parameters. The risk appetite statement ensures that limits/targets are applied and monitored across all key operating jurisdictions and legal entities. The risk appetite framework is a function of business strategy, budget and capital processes, our stress testing reviews and the regulatory and economic environment in which the Bank is operating. The risk appetite framework is reviewed (in light of the above aspects) and approved by the Board at least annually or as business needs dictate. A documented process exists where our risk profile is measured against our risk appetite and this positioning is presented to the IBP BRCC and Board as well as the DLC BRCC and DLC Board. In the section that follows, the Bank's high-level summary of overall risk appetite and positioning has been detailed against the respective principal risks. #### Three levels of defence The Bank has a strong and embedded risk and capital management culture with policies, processes and systems in place to address these principal risks. Risk awareness, governance, controls and compliance are embedded in all our day-to-day activities through a levels of defence model. The levels of defence model is applied as follows: • Level 1 – Business units: responsible for identifying and managing risks inherent in the products, activities, processes and systems for which they are accountable • Level 2 – Independent risk and compliance functions: responsible for building and embedding risk frameworks, monitoring the implementation of effective risk management practices, challenging the business lines’ inputs to, and outputs from, the Bank’s risk management, risk measurement and reporting activities • Level 3 – Independent internal audit: responsible for providing independent and objective assurance over the design and effectiveness of governance, risk management and control processes. #### Overview of principal risks The Board, through its various committees, has performed a robust assessment of the principal risks and regular reporting of these risks is made to the Board. The Board recognises that, even with sound appetite and judgement, extreme events can happen which are completely outside of the Board’s control. It is, however, necessary to assess these potential events and their impact and how they may be mitigated. It is the Bank’s policy to regularly conduct multiple stress testing scenarios (including reverse stress testing) which, in theory, test extreme but plausible events and from that, assess and plan what can be done to mitigate the potential outcomes. In addition to the principal risks, emerging risks continue to be reviewed and assessed. These emerging risks are evaluated for their inherent risk level and potential impact on the Bank's strategy, operations, financial performance and viability. Mitigation measures are considered to address these emerging risks, taking into account their potential influence on the principal risks. A number of these risks are beyond the Bank’s control and are considered in our capital plans, stress testing analyses and budget processes, where applicable. The Bank’s stress testing framework is well embedded in its operations and is designed to identify and regularly test the Bank’s key vulnerabilities under stress. A fundamental part of the stress testing process is a full and comprehensive analysis of the Bank’s material business activities, incorporating views from risk, the business units and the executive – a process called the ‘bottom-up’ analysis. Resulting from the ‘bottom-up’ analysis, the Investec-specific stress scenarios are designed to specifically test the unique attributes of the Bank’s portfolio. The key is to understand the potential threats to our sustainability and profitability and thus a number of risk scenarios are developed and assessed. These Investec-specific stress scenarios form an integral part of our capital planning process and IFRS 9 reporting. The stress testing process also informs the risk appetite review process and the management of risk appetite limits and is a key risk management tool of the Bank. Reverse stress tests are conducted to stress the Bank’s business plan to failure and consider a broad variety of extreme and remote events. These processes allow the Bank to proactively identify underlying risks and manage them accordingly. 46 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Credit and counterparty risk | | | | Credit and counterparty risk is defined as the risk arising from an obligor’s (typically a client or counterparty) failure to meet the terms of any agreement thereby resulting in a loss to the Bank, arising when funds are extended, committed, invested, or otherwise exposed through contractual agreements, whether reflected on- or off-balance sheet | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • Independent credit committees exist which also have oversight of regions where we assume credit and counterparty risk. These committees operate under Board-approved delegated limits, policies and procedures • There is a high level of executive involvement in decision-making with non-executive review and oversight • The Bank’s credit exposures are to a select target market comprising high-income and high net worth individuals, established corporates, small and medium-sized enterprises, financial institutions and sovereigns • Our risk appetite continues to favour lower risk, income-based lending with exposures well collateralised and credit risk taken over a short to medium term • Investec has limited appetite for unsecured debt. A strong emphasis is placed on proven income and cash flows generated by the clients and risk is managed through assessment of the ability of clients to meet their payment obligations and/or tangible assets provided in support of their obligations • Portfolio reviews (including stress testing analyses) are undertaken on all material businesses, where the portfolios are analysed to assess any migration in portfolio quality, highlight any vulnerabilities, identify portfolio concentrations and make appropriate recommendations, such as a reduction in risk appetite limits or specific exposures. | | | | | | | | | | | | | | | | | | | | | | Further information | | | | Page_references.png | Read more on pages [248](#i447e4d363cd344738300acdd42f0e3a0_487) to 265. | | | | | | | | | | | | | Risk appetite and tolerance metric We target a credit loss ratio of less than 1.5% under a weak economic environment/stressed scenario (under normal conditions, less than 0.5%). We target Stage 3 net of ECL as a % of net core loans subject to ECL to be less than 4% under a weak economic environment/ stressed scenario (excluding the Legacy portfolio\*; under normal conditions, less than 2%). We target Stage 3 net of ECL as a % of CET1 less than 25%. | | | Positioning at 31 March 2025 The Bank currently remains within all tolerance levels given the current weakened economic environment. The credit loss ratio was calculated at 0.60% for 31 March 2025 ( 0.58% : 31 March 2024 ). Stage 3 net of ECL as a % of net core loans subject to ECL was 2.6% (excluding the Legacy portfolio\*). Stage 3 net of ECL as a % of CET1 is 17.0% . | | | | | | | | | | | | \*Refer to definitions on page [393](#i447e4d363cd344738300acdd42f0e3a0_535). 47 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Concentration risk | | | | Concentration risk refers to the risk that could arise from a single client or counterparty, group of connected counterparties, or from a particular geography, asset class, supplier or industry. Concentration risk may occur when counterparties are mutually affected by similar economic, legal, regulatory or other factors which could hinder their ability to meet contractual obligations | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | As a matter of course, concentration risk is well managed and exposures are well spread across geographies, asset classes and industries • We target a diversified funding base, avoiding undue concentrations by investor type, maturity, market source, instrument and currency • Consideration is given to concentration risk when assessing suppliers and third parties, both within the business and across the financial sector systemically • We target a diversified loan portfolio, lending to clients we know and understand. Credit and counterparty risk is always assessed with reference to the aggregate exposure to a single counterparty or group of related parties to manage concentration risk. These are reported to IBP BRCC on a regular basis. In order to manage concentration, we will consider a sell-down of exposures to market participants • Concentration risk can also exist where loan maturities are clustered to single periods in time. Loan maturities are monitored on a portfolio and a transaction level. | | | | | | | | | | | | | | More information | | | | | | | | Read more on page [248](#i2d036d396f5b4cda9b8b21fbd411c5bf_0-1-1-1-2494133) . | | | | | | | | | | | | | | | | | | | | | Risk appetite and tolerance metric We limit our core loan exposure to a single/connected individual or company to £120 million. We also have a number of risk tolerance limits and targets for specific asset classes. Third party and outsourcing concentrations are permitted in relation to regulated, systemically important entities, external auditors or specialist global network infrastructures. Where strategic decisions result in concentration risk in third parties outside of these classifications, these decisions are based on considered analysis where the benefits outweigh the risks and appropriate controls have been deployed for managing and monitoring the associated risks. | | | Positioning as of 31 March 2025 We maintained this risk tolerance level throughout the year. | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Country risk | | | | Country risk refers to the risk of lending to a counterparty operating in a particular country or the risk inherent in a sovereign exposure, i.e. the risk of exposure to loss caused by events in that country. Country risk covers all forms of lending or investment activity whether to/with individuals, corporates, banks or governments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • Exposures are only to politically stable jurisdictions that we understand and have preferably operated in before • The legal environment should be tested, have legal precedent in line with the Organisation for Economic Co-operation and Development (OECD) standards and have good corporate governance • In certain cases, we may make use of political risk insurance to mitigate exposure where deemed necessary. | | | | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | | Read more on page [249](#ie082519547e1493dac57403a8b48a8ba_2653) . | | | | | | | | | | | | Risk appetite and tolerance metric We have a preference for primary exposure in the Bank’s main operating geography (i.e. the UK). We will accept exposures where we have a branch or local banking subsidiary and tolerate exposures to other countries where we have developed a local understanding and capability or we are facilitating a transaction for a client. | | | Positioning at 31 March 2025 We maintained this risk tolerance level in place throughout the year. | | | | | | | | | | | | | 48 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Sustainability risk | | | | The risk that our lending and investment activities give rise to unintended climate, environmental, social and economic consequences | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • Investec has a holistic approach to sustainability, and supports the precautionary approach to sustainability management, guided by international best practices regarding the responsibilities of the financial sector in financing and investing transactions • This approach runs beyond recognising the Bank’s own footprint on the environment and is based on a responsibility to the broader economy, environment and society • We recognise the complexity and urgency of climate change. We are committed to supporting the transition to a clean and energy efficient world while preserving our planet and the wellbeing of our people • The DLC Executive Sustainability Committee, mandated by the Investec Group’s executive directors, reports relevant sustainability-related matters to the DLC SEC and Investec Group ERC. The main objectives of the committee are to coordinate sustainability-related efforts across geographies and businesses • Accordingly, sustainability risk considerations are taken into account by the relevant credit or investment committee, in conjunction with the Investec Group sustainability team, when making lending or investment decisions • Investec’s climate change position statement stems from the belief that one of the greatest socio- economic impacts we can have is to partner with our clients and stakeholders to accelerate a cleaner, more resilient and inclusive world • Our environmental policy considers the risks and opportunities that climate change and nature degradation present to the global economy. | | | | | | | | | | | | | | | | | | | | | More information | | | | | | | | Read more on pages [249](#ie082519547e1493dac57403a8b48a8ba_2655) , [269](#i447e4d363cd344738300acdd42f0e3a0_505) to [271](#i59fbf121b9b54e06a8eefe1122629db5_3-4-1-1-2494133) and pages 112 to 131 of the Investec Group's 2025 integrated and strategic annual report and the Investec Group’s 2025 sustainability report which is published and available on our website: www.investec.com. | | | | | | | | | | | | | | | | | | | Risk appetite and tolerance metric It is important to consider potential financial risk that could result from unmanaged sustainability-related risks. We are continually monitoring best practice in this area and will continue to develop and enhance our approach over time. We take a cautious approach with respect to industries falling in our high-risk sustainability categories that are known to have negative environmental (including climate) and societal consequences. Our targets around fossil fuel activities can be found in our published fossil fuel policy on our website. Further detail around our zero tolerance activities can be found in the Investec Group’s 2025 sustainability report. | | | Positioning as of 31 March 2025 We maintained this risk tolerance level in place throughout the year. | | | | | | | | | | | | | 49 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Investment risk | | | | Investment risk arises where the Bank invests in largely unlisted companies and select property investments, with risk taken directly on the Bank’s balance sheet | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • Independent credit and investment committees exist in the UK which provide oversight of regions where we assume investment risk • Risk appetite limits and targets are set to limit our exposure to investment risk • As a matter of course, concentration risk is avoided and investments are well spread across geographies and industries. | | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on page [272](#i447e4d363cd344738300acdd42f0e3a0_508) . | | | | | | | | | | Risk appetite and tolerance metric We have moderate appetite for investment risk, and set a risk tolerance of less than 27.5% of CET1 capital for our unlisted principal investment portfolio. | | | Positioning as of 31 March 2025 Our unlisted investment portfolio amounted to £211  million, representing 8.2% of CET1. | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Market risk in the trading book | | | | Traded market risk is the risk of potential value changes in the trading book as a result of changes in market factors such as interest rates, equity prices, commodity prices, exchange rates, credit spreads and the underlying volatilities where derivatives are traded. The trading book is defined as positions in financial instruments and commodities, including derivative products and other off-balance sheet instruments that are held within the respective trading desks | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • Independent market risk management teams identify, measure, monitor and manage market risk • The focus of our trading activities is primarily to support our clients. Our strategic intent is that proprietary trading should be limited and that trading should be conducted largely to facilitate client flow • Within our trading activities, we act as principal with clients or the market. Market risk exists where we have taken on principal positions resulting from market making, underwriting and facilitation of client business in the foreign exchange, interest rate, equity, credit and commodity markets • Measurement techniques used to quantify market risk arising from our trading activities include sensitivity analysis, value at Risk (VaR), stressed VaR (sVaR), expected shortfall (ES) and extreme value theory (EVT). Stress and scenario analyses are used to add insight to possible outcomes under severe market disruptions. | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | Read more on pages [274](#i447e4d363cd344738300acdd42f0e3a0_514) to  [277](#ia4eb1c9c51984900a6f282b3d0da7ae3_0-1-1-1-2494133). | | | | | | | | | | | | | | | | | | Risk appetite and tolerance metric Market risk arises through our trading activities which are primarily focused on supporting client activity. Appetite for proprietary trading is limited. We set an overall tolerance level of a one-day 95% VaR of less than £2.25 million. | | | Positioning as of 31 March 2025 We met these internal limits; one-day 95% VaR was £ 0.2 million at 31 March 2025. | | | | | | | | | | | | | 50 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Liquidity risk | | | | Liquidity risk refers to the possibility that, despite being solvent, we have insufficient capacity to fund increases in assets or are unable to meet our payment obligations as they fall due, in normal and stressed conditions. This includes repaying depositors or maturing wholesale debt. This risk arises from mismatches in the timing of cash flows, and is inherent in all banking operations and can be impacted by a range of institution- specific and market-wide events | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • Our banking entity in the UK is ring-fenced from the Investec Group's banking entity in South Africa and is required to meet the UK regulatory liquidity requirements • Each geographic entity is self-sufficient from a funding and liquidity standpoint and must adhere to the respective Board-approved risk appetite limits and management policy metrics • The Bank maintains a liquidity buffer in the form of unencumbered cash, government or rated securities (typically eligible for repurchase with the central bank), and near cash assets well in excess of the regulatory requirements as protection against unexpected disruptions in cash flows. We maintain a prudent approach to the mix of instruments in the liquidity buffer to ensure it is available when and where required, taking into account regulatory, legal and other constraints • Daily liquidity stress tests are carried out in order to help accurately measure the liquidity profile and ensure that in the absence of market or funding liquidity during periods of stress, obligations will continue to be met • The maintenance of sustainable prudent liquidity resources takes precedence over profitability • The Bank targets a diversified funding base, avoiding undue concentrations by investor type, maturity, market source, instrument and currency • Our core loans are predominantly funded by stable funding • The Bank does not rely on committed funding lines for protection against unforeseen interruptions to cash flow • The balance sheet risk management team independently monitors key daily funding metrics and liquidity ratios to assess potential risks to the liquidity position, which further act as early warning indicators of potential normal market disruptions • Investec plc maintains a contingency funding and recovery plan designed to protect depositors, creditors and shareholders and maintain market confidence during adverse liquidity conditions. This document is reviewed and approved by IBP BRCC, DLC BRCC and by the IBP and DLC Boards • Investec plc undertakes an annual Internal Liquidity Adequacy Assessment Process (ILAAP) which documents the approach to liquidity management across the firm, including IBP (solo basis). This document is reviewed and approved by IBP BRCC, DLC BRCC and by the IBP and DLC Boards. | | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [278](#i447e4d363cd344738300acdd42f0e3a0_517) to  [283](#icd4ee75502c2463ea93e90de1b2ebc08_38996). | | | | | | | | | | | | | | | | | | | | | | | | | Risk appetite and tolerance metric The Bank carries a high level of liquidity in all its banking subsidiaries in order to be able to cope with shocks to the system, targeting a minimum cash and near cash to customer deposit ratio of 25%. | | | Positioning as of 31 March 2025 Total cash and near cash balances amounted to £ 9.1 billion at year end representing 42.2% of customer deposits. | | | | | | | | | | | | | 51 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Interest rate risk in the banking book (IRRBB) | | | | IRRBB arises from the impact of adverse movements in interest rates on both earnings and economic value of equity. IRRBB is an inherent consequence of conducting banking activities, and arises from the provision of non-trading banking services | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • The daily management of IRRBB is centralised within the Treasury of each banking entity and is subject to local independent risk and local Asset and Liability Committee (ALCO) review • Together with the business, the treasurer develops strategies regarding changes in the volume, composition, pricing and interest rate characteristics of assets and liabilities to mitigate the interest rate risk and ensure a high degree of net interest margin stability over an interest rate cycle. These are presented, debated and challenged in the respective ALCO • Each banking entity has its own Board-approved IRRBB policy and risk appetite, which is clearly defined in relation to both earnings risk and economic value of equity risk • The policy dictates that long-term (>one year) IRRBB is managed within Board-approved risk appetite limits. Where natural hedges between banking book items do not suffice to reduce the exposure within defined limits, interest rate swaps are used to transform fixed rate assets and liabilities into variable rate items • IRRBB is measured and analysed by utilising standard tools of traditional interest rate repricing mismatch and net present value (NPV) sensitivity to changes in interest rate risk factors. | | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [282](#icd4ee75502c2463ea93e90de1b2ebc08_8896) to  [283](#icd4ee75502c2463ea93e90de1b2ebc08_8889). | | | | | | | | | | | | | | | | | | | Risk appetite and tolerance metric A movement in rates can result in a negative impact on revenues across the banking industry. This risk is managed within the Bank's risk appetite framework as a proportion of capital and net interest income in order to limit volatility. | | | Positioning at 31 March 2025 The Bank is within these tolerance metrics. The UK regulatory framework requires banks to assess their Pillar II requirements, including those related to IRRBB, as part of systems and processes included in their Internal Capital Adequacy Assessment Process (ICAAP) . | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Capital risk | | | | The risk that we do not have sufficient capital to meet regulatory requirements or that capital is inefficiently deployed across the Bank | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • The Bank undertakes an approach to capital management that utilises both regulatory capital as appropriate to the jurisdiction in which it operates and internal capital, which is an internal risk- based assessment of capital requirements • A detailed assessment of the regulatory and internal capital position is undertaken on an annual basis and is documented in the ICAAP. The ICAAP is prepared at the consolidated Investec plc level and incorporates the Bank (solo-consolidation basis)\*. The document is reviewed by the IBP, PLC and DLC Capital Committees before being recommended for approval to the IBP BRCC, DLC BRCC and the IBP and DLC Boards • The determination of target capital is driven by our strategy, risk profile and risk appetite, taking into account the regulatory and market factors applicable to the Group • At the most fundamental level, we seek to balance our capital consumption between prudent capitalisation in the context of the Group’s risk profile and optimisation of shareholder returns • Our internal capital framework is designed to manage and achieve this balance • The framework has been approved by the Board. The IBP Capital Committee (mandated by IBP BRCC) is responsible for the oversight and management of capital and leverage. • The leverage ratio is considered and monitored as part of the capital management framework. | | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [287](#i447e4d363cd344738300acdd42f0e3a0_526) to  [291](#i7c92788fb1474a82a8a57477341a81fa_14283). | | | | | | | | | | | | | | | | | | | Risk appetite and tolerance metric We intend to maintain a sufficient level of capital to satisfy regulatory requirements and our internal target ratios. We target a Total Capital ratio range of between 14% and 17%, a minimum Tier 1 ratio of > 11% and a CET1 ratio of > 10%, on a solo-consolidated and consolidated basis for IBP. We are a lowly leveraged firm and target a leverage ratio in excess of 6%. | | | Positioning at 31 March 2025 The Bank met all these targets. The leverage ratio is 10.5% . | | | | | | | | | | | | | \*IBP applies the provisions laid down in article 9 of the CRR (solo-consolidation waiver) and therefore includes Investec Investments (UK) Limited in the solo- consolidation basis. 52 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Reputational risk | | | | Reputational risk is damage to our reputation, name or brand. Reputational risk is often associated with strategic decisions made and also arises as a result of other risks manifesting and not being appropriately mitigated or managed | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • We have various policies and practices to mitigate and/or manage reputational risk, including strong values that are regularly and proactively reinforced • Reputational risk is mitigated and/or managed as much as possible through detailed processes and governance/escalation procedures from business units to the Board, and from regular, clear communication with Investec Group shareholders, customers and all stakeholders • The Investec Group has a disclosure and market communications policy which is reviewed and approved annually by the Investec Group ERC and DLC BRCC. | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on page 83 of the Investec Group's 2025 risk and governance report. | | | | | | | | | | | | | | | | Risk appetite and tolerance metric We have a number of policies and practices in place to mitigate and/or manage reputational risks. | | | Positioning at 31 March 2025 We have continued to mitigate and/or manage these risks where possible throughout the year. | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Business and strategic risk | | | | Business and strategic risk relates to external market factors that can create income volatility | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • Bank strategy is directed towards generating and sustaining a diversified income base for the Bank • The risk of loss caused by income volatility is mitigated through diversification of income sources, reducing concentration of income from any one type of business or geography and maintaining a flexible cost base • In the instance where income falls we retain the flexibility to reduce costs (particularly variable remuneration), thereby maintaining a competitive cost to income ratio. | | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages 4 to [14](#if5782f5257f740b3bf254301633fae81_4557), pages 26 to [39](#ibd82281f51b144b4b74b2fd1e66068d5_5418) , pages 8 to 87 of the Investec Group's 2025 integrated and strategic annual report and pages 78 to 81 of the Investec Group’s 2025 year- end results booklet. | | | | | | | | | | | | | | | | Risk appetite and tolerance metric The Investec Group aims to build a sustainable business generating sufficient return to shareholders over the longer term and seeks to maintain strict control over fixed costs. The Investec Group has a medium-term\* return on equity (ROE) target range for its UK and Other operations of 10% to 14%, a return on tangible equity (ROTE) target range of 13% to 17%, and cost to income ratio target of below 58%. | | | Positioning at 31 March 2025 The Investec Group’s UK and Other operations reported a ROE of 11.2% , a ROTE of 14.5% . and a cost to income ratio of 52.7% . The cost to income ratio for IBP was  50.2%. | | | | | | | | | | | | | | | | | | | | | | | \* Revised medium-term targets to 31 March 2027. 53 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Operational risk | | | | Operational risk is defined as the potential or actual impact to the Bank as a result of failures relating to internal processes, people, systems or from external events. The impact can be financial as well as non-financial such as customer detriment, reputational or regulatory consequences | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • IBP manages operational risk through an embedded operational risk management framework • Operational risk sub-types which are significant in nature are managed by dedicated specialist teams within the Bank. These operational risk sub-types are addressed in specific, detailed risk policies and procedures, but are included within the operational risk management framework and are reported and monitored within the operational risk appetite. These sub-types include: – Business disruption and operational resilience risk – Conduct risk (including Consumer Duty) – Data management risk – Financial crime risk – Fraud risk – Information security and cyber risk – Legal risk – Model risk – People risk – Physical security and safety risk – Processing and execution risk – Regulatory compliance risk – Tax risk – Technology risk – Third party risk • The Bank maintains insurance to cover key insurable risks. | | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) and [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787) and pages 84 to 87 of the Investec Group’s 2025 risk and governance report. | | | | | | | | | | | | | | | | | | | Risk appetite and tolerance metric We monitor the level of acceptable operational risk exposure/loss through qualitative and quantitative measures. | | | Positioning at 31 March 2025 Operational risk exposures and losses continue to be monitored against the tolerance levels with appropriate escalation and action where required. | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Operational risk – Business disruption and operational resilience risk | | | | The risk associated with disruptive incidents which may impact critical functions and important business services including key dependencies such as processes, premises, employees, equipment, third party services and technology systems | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | • IBP maintains business continuity through appropriate resilience strategies that cater for severe but plausible scenarios, irrespective of the cause • These strategies include, but are not limited to, enabling employees to work from home, the application of high availability technology solutions, obtaining third party dependency business continuity assurances, implementing substitutability arrangements and ensuring readiness of physical solutions for critical infrastructure components • Resilience testing is conducted annually to validate business continuity strategies and ensure they remain effective and appropriate. This includes annual recovery testing for all key systems that support important business services. | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages  [284](#i447e4d363cd344738300acdd42f0e3a0_520)  and [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787). | | | | | | | | | | | 54 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Operational risk – Conduct risk | | | | The risk associated with inappropriate behaviours or business activities that may lead to client, counterparty or market detriment, erosion of Investec values, culture and ethical standards expected of its employees, reputational and/or financial damage to the Bank | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | • IBP’s approach to conduct risk is driven by our values and philosophy, ensuring that the Bank operates with integrity and puts the wellbeing of its customers at the heart of how the business is run • Risk and Conduct Forums have the objective of ensuring that the Bank maintains a customer- focused and fair outcomes-based culture • There is regular conduct risk reporting to relevant ERC, BRCC and Board committees • The conduct risk policy is designed to create an environment for consumer protection and market integrity within the business, supported with the right conduct risk management framework • Consumer Duty rules and guidance set higher and clearer standards of consumer protection across the financial services industry and require institutions to put their customers’ needs first. These requirements have been incorporated into conduct risk frameworks, policies and governance arrangements. | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) , [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787) and pages 84 to 86 of the Investec Group's 2025 risk and governance report. | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Operational risk – Data management risk | | | | The risk associated with mismanagement in acquiring, processing, storing and protecting data. Issues with data quality, reliability or corruption can adversely impact business decisions, client services and financial reporting | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | • The Bank promotes strong data management practices and ensures accountability for data across the organisation. This includes managing data modelling and architecture, reference data, master data, metadata, and reporting any data quality issues • Adoption of necessary data management tooling is in place for data consolidation, storage, data security, privacy, accessing data and reporting • Data flows and reconciliations are automated as far as possible and integration between systems is streamlined to reduce the need for manual tasks, minimise data processing delays and limit single points of failure • Data quality is monitored, reported and enhanced in line with business needs and regulatory principles • Predictive analytics and data insights are utilised to support proactive risk management • Data retention and destruction processes are designed to meet business needs and comply with applicable legal obligations. | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) and [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787). | | | | | | | | | | | 55 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Operational risk – Financial crime risk | | | | The risk associated with the possibility of handling proceeds of crime, financing of terrorism, proliferation financing, sanctions breaches and bribery or corruption, as well as any related regulatory breaches | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | • Established policies, procedures and controls are in place to promote business with clients in such a manner that minimises exposure to money laundering and terrorist or proliferation financing, sanction breaches, bribery or corruption • Regular training is provided to employees to create awareness to identify and report suspicion of money laundering and terrorist or proliferation financing • A risk-based approach supports these objectives, while complying with the Bank’s regulatory compliance obligations. At a high level the control framework ensures that: – Sufficient information about existing and prospective clients is obtained – All clients and prospective clients are risk rated and verification commensurate with their risk profile is conducted – All prospective and existing clients and relevant related parties are screened against relevant lists (including applicable sanctions list) to identify increased financial crime risk – Suspicious transactions and terrorist or proliferation financing are identified and reported to the relevant regulatory bodies – Existing and prospective clients that are not within the Bank’s financial crime risk appetite are exited or declined – An independent integrity (whistleblowing) line is in place to ensure that staff can report regulatory breaches, allegations of fraud, bribery or corruption, and non-compliance with policies – There is regular reporting to IBP BRCC. | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) , [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787) and page 86 of the Investec Group's 2025 risk and governance report. | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | Operational risk – Fraud risk | | | | The risk associated with any kind of criminal conduct arising from fraud, corruption, theft, forgery and misconduct by employees, clients, suppliers or any other internal or external stakeholder | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | • The Bank manages internal and external fraud risk through an integrated framework which includes global policies, standards and methodologies and adherence to these are proactively monitored • Detection and prevention systems are utilised to help identify potential fraud, reaching out to clients or suppliers where appropriate to validate or discuss concerns • Fraud risk assessments are conducted to proactively identify and map existing preventative and detective controls to the relevant fraud risks to ensure effective mitigation • Fraud prevention and detection controls are enhanced on an ongoing basis in response to regulatory requirements and increased fraud losses across the industry due to existing and new fraud modus operandi • Industry collaboration assists with fraud prevention efforts and the recovery of funds that have been paid away • Practices which comply with updated regulations, industry guidance and best practice are embedded within the Bank • Awareness of existing and horizon fraud threats is created through internal training and education of clients and intermediaries on fraud prevention and detection. | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) and  [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787). | | | | | | | | | | | | | | | | | | 56 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | Operational risk – Information security and cyber risk | | | | The risk associated with unauthorised access, use, disclosure, modification or destruction of information assets, including cyber threats to the Bank’s operations and data | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | • The risk is managed by addressing both internal and external threats to our systems and data • Internal threats relate to data theft, inappropriate access or confidentiality breaches by employees – Data protection controls have been implemented in line with data sensitivity, with advanced data loss prevention measures of confidential data – Access to systems and data is tightly controlled and regularly reviewed – Privileged IT access is restricted and administrative accounts are protected by strong authentication and automated password management – A dedicated insider threat team drives targeted monitoring to detect anomalous behaviours and proactively identify and respond to potential data loss events – Ongoing security training of all employees ensures high level of awareness and vigilance, augmented by tailored training for specific audiences and risks • External threats relate to cyberattacks such as ransomware, denial of service and cyber fraud – An adaptive cyber strategy evolves with the changing cyber threat landscape – We leverage advanced technologies for layered protection against sophisticated attacks – Cyber risk is monitored by a 24/7 global team, collaborating with external threat intelligence partners and industry groups to identify and respond to emerging risks – Cyber controls are stress-tested through security assessments, attack simulations and executive cyber exercises, run both internally and in conjunction with independent specialists – Continuous improvement, is driven by maturity benchmarking against industry peers and monitoring through leading cyber rating platforms – Periodic updates to the Board keep them abreast of the threat landscape and informed on the Bank’s security position • Investec actively researches the potential security risks posed by artificial intelligence (AI) and the development of proactive mitigation. This includes threat simulations to assess our ability to detect and prevent deepfake attacks and AI-powered malware • Information security and cyber risk are reported to the DLC IT and Risk and Governance Committee with material issues escalated to IBP BRCC. | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) and  [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787). | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Operational risk – Legal risk | | | | The risk associated with losses resulting from any of our rights not being fully enforceable or from our obligations not being properly performed. This includes our rights and obligations under contracts entered into with counterparties. Such risk is especially applicable where the counterparty defaults and the relevant documentation may not support the anticipated rights and remedies in the transaction | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | • Members of the legal risk function are mandated to ensure we keep abreast of developments and changes in the nature and extent of our activities, and to benchmark our processes against best practice • The key principles of the legal risk policy describe the overall responsibility of the legal risk function, outline how legal risks are to be assessed and how material legal risks should be reported and escalated where necessary • There is a central independent in-house legal team with embedded business unit legal officers where business volumes or needs dictate • The legal risk function is supplemented by suitably qualified third party legal firms/counsel to be utilised where necessary • The Board may, at their discretion, constitute dedicated committees to deal with specific legal matters. | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | | Read more on page 83 of the Investec Group's 2025 risk and governance report. | | | | | | | | | | | | 57 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | Operational risk – Model risk | | | | The risk associated with the adverse consequences that arise from decisions based on incorrect or misused model outputs (including reports). Material sources of model risk include: credit model risk, liquidity model risk, trading book model risk and IRRBB model risk | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | • The Bank manages model risk through embedded, risk specific frameworks and policies • Model governance forums employ a set of mechanisms such as regular model reviews (prioritised by risk), model validations and overlays to manage this risk • The frameworks address roles and responsibilities, governance processes and committees and approaches to managing model risk • Material models are recorded in a model inventory, which tracks approval status, validation date, ongoing issues, caveats/recommendations in relation to model use, as well as the model validation findings • Models are subject to independent initial and then regular validation by specialist risk teams; the frequency and scale of which is determined by their assessed risk • The relevant committees are mandated to oversee model risk and have delegated further oversight and approval to appropriate sub-committees. | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) and  [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787). | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | Operational risk – People risk | | | | The risk associated with the inability to recruit, develop, retain and engage diverse talent across the organisation and remain aligned to the Investec purpose, values and culture | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | • Our people and organisation team plays a critical role in assisting the business to achieve its strategic objectives, which are matched to learning strategies and market trends • The people and organisation team also works with leadership to strengthen the culture of the business, ensure its values are lived, build capability and contribute to the long-term sustainability of the organisation • The people and organisation team is mandated to enable the attraction, recruitment, development and retention of talent who can perform in a manner consistent with our culture and values • We focus on building a strong, diverse and capable workforce by providing a workplace that stimulates and rewards distinctive performance • Investec invests significantly in opportunities for the development of all employees, and in leadership programmes to enable current and future leaders of the Group • Internal mobility is a key element for our people strategy, it drives succession, supports our One Investec Group strategy and is a valuable retention mechanism. | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages 124 and 125 of the Investec Group's 2025 integrated and strategic annual report and the Investec Group’s 2025 sustainability report which is published and available on our website: www.investec.com. | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | Operational risk – Physical security and safety risk | | | | The risk associated with the potential or actual impact to the Bank arising from threats to people, assets, facilities, or information due to unauthorised access, theft, vandalism, natural disasters, or other physical threats | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | • There is 24/7 surveillance and access control including CCTV monitoring, security personnel, and controlled access systems at all Investec office locations • Continuous evaluation is conducted on emerging security threats through intelligence gathering and site risk assessments • Security awareness programmes train employees on physical security, and emergency preparedness. | | | | | | Entrepreneurial_Culture_Black.png Digitalisation_Black.png Strategic_use_of_Data_Black.png | | | | | | | | | | | | | | | | | | More information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) and [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787). | | | | | | | | | | | | | 58 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | Operational risk – Processing and execution risk | | | | The risk associated with the failure to process, manage and execute transactions and/or other processes (such as change) completely, accurately and timeously due to human error or inadequate process design or implementation | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | • The Bank seeks to minimise process failures or human error which can disrupt operations or impact delivery of services to clients • Policies, processes, procedures and key monitoring controls which mitigate against control failures are implemented to protect clients, markets and the Bank from detriment • Key business processes are regularly reviewed and the relevant risks assessed through the risk and control self-assessment process • We manage operational capacity to meet client and industry needs and continue to explore automation to improve efficiency and reduce human error • Material change is managed through dedicated projects with formalised project governance. | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) and  [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787). | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Operational risk – Regulatory compliance risk | | | | The risk associated with changing legislation, regulation, policies, voluntary codes of practice and their interpretation in the markets in which we operate | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • The Bank remains focused on achieving the highest levels of compliance with applicable legislation and/or regulation and professional standards in each of our jurisdictions • Our culture is a major component of our compliance framework and is supported by robust frameworks, policies, processes and talented professionals who ensure that the interests of our stakeholders remain at the forefront of everything we do • An independent integrity (whistleblowing) line is in place to ensure that staff can report regulatory breaches, allegations of fraud, bribery and corruption, and non-compliance with policies • There are independent compliance, legal and risk management functions in each of our core operating jurisdictions, which ensure that the Bank implements the required processes, practices and policies to adhere to applicable legislation and/or regulation and professional standards. | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) , [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787) and pages 84 and 85 of the Investec Group's 2025 risk and governance report. | | | | | | | | | | | | | | 59 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Operational risk – Tax risk | | | | The risk associated with inadequate tax planning, transaction execution, tax compliance and reporting failures | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Monitoring and mitigation activities | | | | | | | | | • IBP’s control environment for the management and mitigation of tax risk includes a formalised tax strategy, framework, policy and processes • The Bank ensures that all transactions and financial products and services are commercially motivated • All advisory and tax planning work is conducted in accordance with the relevant tax laws, regulations and intentions of legislators of the country in which the Bank operates. | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages  [284](#i447e4d363cd344738300acdd42f0e3a0_520) , [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787) and page 87 of the Investec Group's 2025 risk and governance report. | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Operational risk – Technology risk | | | | The risk associated with disruption to or malfunction of critical IT infrastructure, systems or applications that support key business processes and client services | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Risk management and key mitigating actions | | | | | | | | | • The technology environment is proactively monitored for continuous visibility of operational performance and availability • Mature incident management processes and continuity plans support a resilient technology environment that is able to respond to disruption and minimise interruption to business services • A defined, business-aligned strategy directs implementation of new technologies to enhance resilience, scalability and modernise legacy systems • Internal controls are automated where possible and augmented with monitoring to reduce human error and enhance efficiency • Technology governance structures provide oversight of IT projects and new investments in infrastructure and software. | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) and [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787). | | | | | | | | | | | | | | 60 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | PRINCIPAL RISKS CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Link to strategy – key | | | | | | | | | | | | | | | | | | | Connected client ecosystems | | | Growth initiatives | | | Optimisation of returns | | | Entrepreneurial culture | | | Digitalisation | | | Strategic use of data | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Operational risk – Third party risk | | | | The risk associated with the reliance on and use of external providers of services to the Bank | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Link to strategy and opportunities | | | | Risk management and key mitigating actions | | | | | | | | | • Formal policies and practices govern the assessment of suitability, selection, approval, oversight as well as the off-boarding process of third party service providers • A dedicated third party management team coordinate and drive consistency of third party practices, supported by a centralised vendor management platform • Robust due diligence processes are in place to evaluate and periodically review the adequacy and resilience of third party controls, applying the appropriate level of rigour based on risk and materiality • Comprehensive legal agreements and ongoing monitoring ensures that contractual obligations are met, required service levels are maintained, and data appropriately safeguarded • Appropriate supplier business contingency plans, including exit strategies for key/critical vendors, are established and managed to minimise client impact following any disruption in service • Regular monitoring is conducted to maintain an understanding of our strategic partnerships with technology service providers and that of any fourth party providers • Service disruption or security risks that third parties may introduce are identified and managed • Significant importance is placed on adhering to the relevant laws and regulations related to third parties, including third parties' policies on modern slavery. These are carefully reviewed by specialist teams and any potential concerns escalated where appropriate. | | | | | | | | | | | | | | | | | | | | | | | | | Further information | | | | | | | Read more on pages [284](#i447e4d363cd344738300acdd42f0e3a0_520) and [285](#i1fdbebb419f840ebbb5c57214c5b5c45_4787). | | | | | | | | | | | | | | Emerging and other risks Emerging risks have been identified are highlighted on pages 27 to 29 of the Investec Group's 2025 risk and governance report and should be read in the context of our approach to risk management and our overall Investec Group risk appetite framework. | | | | --- | --- | | | | | | Additional risks and uncertainties not presently known to us or that we currently deem immaterial may in the future also negatively impact our business operations. Emerging and other risks are factored into the Board’s viability assessment. Read more on page [88](#i447e4d363cd344738300acdd42f0e3a0_241) | 61 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CHAIR'S INTRODUCTION | | | | | | | | | | | --- | --- | --- | | | | | | | | John Reizenstein Chair | | | | The Bank is well positioned to execute on its strategy and achieve diversified and sustainable growth | | | | As indicated in last year’s annual report, I was appointed as a Non-Executive Director and took the role of Chair of Investec Bank plc on 1 July 2024 following a handover from my predecessor, Brian Stevenson. I would like to start by extending my thanks to Brian for his diligent and comprehensive handover, and also for his role in steering the Bank over the last eight years. The Board is responsible for the governance and performance of the Bank and for setting its strategic direction, guided by the Investec Group’s wider strategy and in alignment with the Group’s purpose and values. The Bank has continued to perform well, in light of the challenging external environment and heightened levels of uncertainty. Profit levels have been sustained, alongside continued investment, to support the Bank’s growth strategy. #### Strategy The Board regularly reviews strategy and during the year we held a Board strategy day to consider potential opportunities and growth initiatives. These included enhancing the Private Client offering, expansion in Europe and India and further development of the Bank’s fund solutions business. In the prior financial year there had been two significant strategic actions, the All-Share Combination of Investec Wealth & Investment (IW&I) UK with Rathbones Group plc (Rathbones) and the acquisition of a majority stake in Capitalmind. With regard to Rathbones, the Board had maintained its oversight of the integration progress, supporting the development of the strategic partnership between the two organisations. Capitalmind has been rebranded to Investec Continental Europe Advisory and the expansion in Europe continues, enabling the Bank to service more clients across numerous sectors, sharing knowledge and expertise. The Bank continued to manage the fast pace of regulatory change within the sector. The Board and the Board Risk and Capital Committee continued to support management in its compliance with the Financial Conduct Authority’s (FCA’s) Consumer Duty requirements and the operational resilience requirements. The Bank has again made progress as it looks to migrate from the Standardised Approach for capital to the Internal Ratings Based (IRB) Approach. The Board will continue to monitor and challenge progress. Migration will better allow stakeholders to compare Investec with its peers and enable the Bank to optimise its capital. | | | | --- | --- | | | | | | Read more detail of key regulatory projects in the Board Risk and Capital Committee report on [pages 83 to 87](#i447e4d363cd344738300acdd42f0e3a0_235). | | | | | --- | --- | | | | | | Read more on the Bank’s strategy on [page 9](#i2ba3b06dbf3c4710a4c54fab329f009e_273). | Financial performance The Bank reported good results against a challenging macro- economic backdrop driven by worsening geopolitical tensions, the new Labour government’s fiscal policy and other factors including subdued gross domestic product (GDP) growth and a changing interest rate environment. Operating profit has been resilient; this is a testament to the strength of our client franchises and has been achieved while successfully maintaining cost discipline, strong liquidity and conservative capital buffers. | | | | --- | --- | | | | | | Read more on our financial performance on [pages 26 to 39](#i447e4d363cd344738300acdd42f0e3a0_106). | Stakeholder engagement The Board recognises the importance of establishing and maintaining good relationships with all stakeholders. We work hard to understand the particular needs of each and determine the most effective way to engage with them. | | | | --- | --- | | | | | | Read more in our Section 172(1) statement on [pages 15 to](#ie3c0f0ecbe744ceeaff4a20772cdfe84_1253) [22.](#ie3c0f0ecbe744ceeaff4a20772cdfe84_1253) | 62 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CHAIR'S INTRODUCTION CONTINUED | | | | | | Succession planning and Board and committee changes The composition of the Board and its committees remains under review by the Nomination Committee. As previously mentioned, I assumed the role of Chair of Investec Bank plc and Chair of the IBP Nomination Committee in July 2024 in succession to Brian Stevenson. Zarina Bassa also stepped down as a director following the Investec plc Annual General Meeting (AGM) in August 2024. Vivek Ahuja joined the Board as an independent Non-Executive Director on 5 March 2025 and was appointed as a member of the IBP Audit Committee, Board Risk and Capital Committee and Remuneration Committee. This appointment further complements and strengthens the Board and its committees. During the year the Board considered the skills and expertise of the Executive Directors and reviewed succession plans for the Executive Directors and senior executive management. | | | | --- | --- | | | | | | Read more on the Nomination Committee on [page 71 to 74](#i447e4d363cd344738300acdd42f0e3a0_223). | People and culture The Board keeps culture under review, with regular updates and deep dives to enable a deeper understanding of the issues faced by our people and the strength of our culture. The Board also reviewed the approach to workforce engagement during the year to ensure that it remained appropriate. The output from workforce engagement and the insight provided by the Bank’s designated Non-Executive Director for workforce engagement, David Germain, made important contributions to the Board’s oversight of relevant issues. The Board recognises that culture is a key differentiator for Investec and one that drives behaviour. It enables us to fulfil our purpose and achieve the Bank’s strategic objectives. Investec prioritises diversity and inclusion and the Board received regular updates on our diversity profile and management’s progress in driving diverse recruitment and inclusive programmes of work across the business. | | | | --- | --- | | | | | | More details of the approach to diversity and workforce engagement can be found on [page 16](#i6616e40c86a1460fbec90c8a1d5ef4e0_2-1-3-3-2997111) and [page 124-125](integratedreport-march2025.htm#ib27636d1a6184801867ab4169b0c8315_11544872094801) and [page 152](integratedreport-march2025.htm#ib27636d1a6184801867ab4169b0c8315_412) of the Investec Group’s 2025 integrated annual report. | Sustainability Our desire to make a meaningful contribution to the world in which we live is at the heart of our values. Environmental, social and governance (ESG) issues have been on the Board’s agenda and we have received regular updates on the business’s approach to these matters, with a particular focus on the Bank’s requirement to adhere to the Corporate Sustainability Reporting Directive (CSRD) and the Group’s recently published Sustainable and Transition Finance Framework targets. We remain resolute in our commitment and endeavour to create enduring worth through transformational growth for our people, clients, shareholders, communities and planet. | | | | --- | --- | | | | | | Further details of the business’s engagement on ESG can be found in the Investec Group’s sustainability report which is published and available on the Investec website. | Board effectiveness Ensuring the Board’s effectiveness is a key component of governance. This year the Board participated in an externally facilitated evaluation process with the support of an independent third party, Fidelio Partners. The findings of this review confirmed that the Board and its committees were operating effectively. The Board’s response to the review is to seek ways to build on its effectiveness in order to add more value to stakeholders. | | | | --- | --- | | | | | | More detail on the findings and progress against them can be found on [page 73 to 74](#ie3d90699d1cb4734b16b6320eda58ccb_50538). | Corporate governance code The Board has applied the UK Corporate Governance Code 2018 (the Code) for the year under review. As advised in the previous year’s report, a decision had been taken to leave the position of Senior Independent Director vacant as it was agreed that given the structure of the Investec Group, there were sufficient arrangements in place. | | | | --- | --- | | | | | | The explanation and further details of how we applied the Code can be found in our statement of compliance on [page](#i447e4d363cd344738300acdd42f0e3a0_205) [66](#i447e4d363cd344738300acdd42f0e3a0_205). | Looking ahead The environment in which the Bank operates continues to be challenging. There are risks which will need to be managed carefully as a result of the political environment globally and the impact of the new US administration, the continuing uncertainty in markets and supply chains, lack of consumer confidence and limited economic growth. Notwithstanding the macro-economic challenges, the Bank remains focused on short and long-term delivery. This includes strategic initiatives previously mentioned and the maintenance of overall technological and operational resilience. The Board monitors the impact of economic conditions and will continue to oversee the risk management, liquidity and governance of the Bank and its subsidiaries as markets evolve. Regulatory developments will be kept under review as the Labour government has indicated its ambition to deregulate and enhance the UK’s competitiveness and reduce bureaucracy. The Bank will continue to meet regulatory expectations with a focus on key regulatory projects specifically, the Resolvability Assessment Framework and the migration to IRB. The next financial year will also see the implementation of the Financial Reporting Council’s (FRC’s) UK Corporate Governance Code 2024 and the Board will remain dedicated to maintaining strong governance principles. The Bank’s performance this year validates the resilience of its platform for delivering sustainable growth. I would like to thank the senior management team and all our committed employees for their dedication and hard work over the last year. #### John Reizenstein Chair 19 June 2025 63 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | DIRECTOR BIOGRAPHIES | | | | | | #### Who we are #### Biographies #### of our current directors are #### outlined below, including their relevant #### skills and experience, key external #### appointments and any appointments #### to Board committees. | | | | | | --- | --- | --- | --- | | | | | | | Committee membership key | | | | | | | | IBP BRRC | | | B | | | | | | | | | | IBP Nomination Committee | | | N | | | | | | | | | | IBP Remuneration Committee | | | R | | | | | | | | | | IBP Audit Committee | | | A | | | | | | | | | | Denotes Committee Chair | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Henrietta_Baldock.png Henrietta Baldock Independent Non-Executive Director | | | | | | | R | | | | | | | | | | | | | | | | | | | | | | Director of DLC Board, Chair of DLC Remuneration Committee and member of DLC BRCC and DLC Nomdac | | | | | | | | | | | | | | | | | | | | | | Age 54 Nationality British Qualifications BSc (Hons) Date of appointment 10 February 2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | Relevant skills and experience Henrietta has extensive knowledge of the financial services sector, through her 25 years’ experience in investment banking, most recently as Chair of the European Financial Institutions team at Bank of America Merrill Lynch, where she advised many boards on a number of significant transactions. In 2021, Henrietta was appointed Chair of Investec Wealth & Investment (UK), a position she held until the completion of the all-share combination with Rathbones in September 2023. Following this, Henrietta was appointed to the Rathbones Group plc Board. Henrietta’s industry experience demonstrates her valuable strategic and transformation advisory skills. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | External appointments Legal and General Assurance Society Limited, Legal and General Group plc and Rathbones Group plc | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | John Reizenstein.png John Reizenstein Chair | | | | | | | B | | N | | R | | | | | | | | | | | | | | | | | | Age 68 Nationality British/German Qualifications MA Date of appointment 2 April 2024 | | | | | | | | | | | | | | | | | | | | | | | | | | | Relevant skills and experience John is an experienced financial executive and former banker with extensive financial services experience across insurance, investment banking and markets. John has held a number of senior client-facing roles at UBS and Goldman Sachs, as well as Executive Board positions as Managing Director, Corporate & Markets at Co-operative Financial Services and as Chief Financial Officer at Direct Line Insurance Group plc. John has also served as a Board member of Scottish Widows. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | External appointments Beazley plc and Farm Africa | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Vivek_Ahuja.png Vivek Ahuja Independent Non-Executive Director | | | | | | | A | | B | | R | | | | | | | | | | | | | | | | | | Director of DLC Board, member of DLC Remuneration Committee, DLC BRCC and DLC Audit Committee | | | | | | | | | | | | | | | | | | | | | | Age 58 Nationality Singaporean Qualifications FCA (ICAEW), BCom Date of appointment 5 March 2025 | | | | | | | | | | | | | | | | | | | | | | | | | | | Relevant skills and experience Vivek has a strong banking background with a deep understanding of finance, strategy, mergers and acquisitions (M&A), business & operational transformation, risk management, and corporate governance. He also has experience in corporate, commercial, consumer, private, institutional and business banking as well as private equity and investment banking. Vivek is a qualified accountant who has held senior financial roles culminating in Deputy Group Chief Financial Officer (CFO) at Standard Chartered plc. He joined the PZ Cussons plc (FTSE 250) Board in 2024 as Independent Non-Executive Director, Senior Independent Director and Chair of the Audit and Risk Committee and was appointed to Aberdeen Group plc as Independent Non-Executive Director, Chair of the Audit Committee and a member of the Risk Committee and Nomination and Governance Committee. He was also an Independent Non-Executive Director and Chair of the Risk Committee at Natwest Markets plc where he served for over six years. | | | | | | | | | | | | | | | | | External appointments PZ Cussons plc, Aberdeen Group plc and Ebury Partners Limited | | | | | | | | | | | | | | | | 64 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | DIRECTOR BIOGRAPHIES CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | DavidGermaine.png David Germain Independent Non-Executive Director | | | | | | | B | | N | | | | | | | | | | | | | | | | | | | | Age 49 Nationality British Qualifications FBCS, CITP, FIET Date of appointment 15 September 2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | Relevant skills and experience David has extensive technology, operations and transformation experience in financial services. He was previously Group Chief Information Officer (CIO) for QBE Limited, Group, UK & International CIO for RSA Limited where he had oversight of significant and complex information technology (IT) transformation projects and has previously held a number of other leadership roles, including Head of Technology, Operations and Product at the Royal Bank of Scotland Corporate and Private Banking, COO/CAO at Deutsche Bank Capital Markets, Chief Operating Officer (COO) at Close Brothers Retail and EMEA CIO at GE Capital. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | External appointments University of Cambridge and Great Ormond Street Hospital Charity | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | LesleyWatkins.png Lesley Watkins Independent Non-Executive Director | | | | | | | A | | B | | R | | N | | | | | | | | | | | | | | | | Age 66 Nationality British Qualifications BSc (Hons) (Mathematics), FCA Date of appointment 13 November 2018 | | | | | | | | | | | | | | | | | | | | | | | | | | | Relevant skills and experience Lesley has long-standing knowledge of audit and assurance and regulatory reporting having worked at PwC and subsequently as Finance Director of private equity firm, Calculus Capital Limited. She also has significant experience of governance and strategy in financial services, having been a Managing Director at UBS and Deutsche Bank as well as having been a Non-Executive Director and Audit Chair at the Competition Commission, Panmure Gordon & Co Plc, Game Digital plc and Braemar plc. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | External appointments Chaucer Syndicates Limited, Chaucer Insurance Company Designated Activity Company and Great Lakes Insurance UK Limited | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Paul Seward.png Paul Seward Independent Non-Executive Director | | | | | | | A | | B | | | | | | | | | | | | | | | | | | | | Age 69 Nationality British Qualifications BSc (Hons) (Mathematics) Date of appointment 1 April 2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | Relevant skills and experience Paul has comprehensive experience of strategy and risk governance in financial services having held a number of senior executive roles including Chief Risk Officer (CRO) at HSBC UK, as well as having held a number of Non-Executive Directorships including M&S Bank, HSBC Asset Finance, HSBC Life (UK) Limited and Axis Bank UK Limited. Paul was also a Trustee and Chair of the Audit and Risk Committee of the HSBC plc pension fund. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | External appointments None | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Marle_van_der_Walt.png Marlé van der Walt Executive Director, IBP Finance Director | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Age 49 Nationality South African Qualifications BAcc (cum laude), BAcc Hons (cum laude), CA(SA), Program for Leadership Development at Harvard Business School (HBS) and Alumni Date of appointment 20 September 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | Relevant skills and experience Marlé has more than 25 years’ experience in the financial services industry and has deep technical expertise across various areas, including finance, capital, model development, operations, risk, audit and implementing complex projects. She has played a key role in significantly enhancing financial performance, implementing strategic projects, encouraging technological progress and streamlining of systems at the bank over her 13 plus years. Marlé started her career in South Africa at PwC and worked at BOE Bank, Nedbank and Absa before joining Investec in 2010 as the Chief Internal Auditor. She was then the CFO for the Specialist Bank in South Africa for three years during which she also served on the Investec Bank Limited Board as Financial Director. Marlé was appointed as Finance Director in September 2022. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | External appointments None | | | | | | | | | | | | | | | | 65 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | DIRECTOR BIOGRAPHIES CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fani_Titi.png Fani Titi Executive Director, Group CE | | | | | | | Director of DLC Board and member of DLC BRCC | | | | | | | | | | | | | | | | | | | | | | Age 62 Nationality South African Qualifications BSc Hons (cum laude), MA, MBA Date of appointment 3 August 2011 | | | | | | | | | | | | | | | | | | | | | | | | | | | Relevant skills and experience Fani was appointed joint Chief Executive Officer (CEO) of Investec Group on 1 October 2018 and sole Group Chief Executive on 16 March 2020. Prior to that Fani chaired the Investec Group Board between November 2011 and May 2018, and was a member of the Investec Group Board since January 2004. Prior to joining Investec, Fani was a private equity professional with the private equity groups the Tiso Group and Kagiso Trust Investment Investments. Fani brings extensive banking and commercial expertise to the Board. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | External appointments BUD Group Holdings (Pty) Ltd. GH Media Group Proprietary Ltd. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | RuthLeas.png Ruth Leas Executive Director, IBP CEO | | | | | | | Age 53 Nationality British Qualifications BA(Hons) (Economics) (cum laude), MPhil (Cantab) Date of appointment 27 July 2016 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Relevant skills and experience Ruth has deep knowledge of Investec and banking having joined Investec in South Africa in 1998. She moved to Investec in London in 2002 and was appointed co-head of US Principal Finance in 2004 focusing on credit derivatives and structured credit. Ruth joined the credit team in 2008, and was appointed as Head of UK Investor Relations in 2012. She was appointed as an Executive Director in 2016 and was Head of Risk Management before becoming CRO in 2017. Ruth was appointed as Investec Bank plc’s CEO in 2019. Prior to Investec, Ruth was treasury economist for Gencor SA Limited, and took up this role after winning the Gencor-Chairman’s scholarship to study at Cambridge University. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | External appointments Cambridge Judge Business School Advisory Board and Rathbones Group plc | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | KevinMcKenna.png Kevin McKenna Executive Director, IBP CRO | | | | | | | Age 58 Nationality Irish Qualifications BCom, BAcc, CA(SA) Date of appointment 10 May 2012 | | | | | | | | | | | | | | | | | | | | | | | | | | | Relevant skills and experience Kevin has substantial strategic, financial, operational and risk experience. He is a qualified accountant and previously worked as the COO of ING Baring’s South Africa before joining Investec as Finance Director for Investec Securities in 2000. He was appointed as COO for the Treasury and Specialised Finance/Corporate and Investment Banking division in South Africa before moving with this role to London in 2006. Kevin was appointed as COO for Investec Bank plc in 2011. He was appointed as an Executive Director in 2012 and became CRO in 2019. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | External appointments None | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 66 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | COMPLIANCE WITH THE UK CORPORATE GOVERNANCE CODE | | | | | | In compliance with the Companies (Miscellaneous Reporting) Regulations 2018, the Bank has applied the UK Corporate Governance Code 2018 for the financial year ended 31 March 2025. The Board confirms that the Bank has applied the principles, which are evidenced throughout this report. The table below is designed to help stakeholders evaluate how this has been achieved. The Board considers that compliance has been achieved throughout the year, with the exception of Provision 12 for which an explanation can be found below. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Board leadership and Company purpose | | | | | | A. An effective entrepreneurial Board, which is collectively accountable for the long-term sustainable success of the Bank, ensuring due regard is paid to the interests of our stakeholders. Please refer to [pages 63 to 65](#icaf75ac48ace49c084ba2bfd03b8fe08_2155) for the directors’ biographies B. Purpose, values and strategy are aligned with culture, which is promoted by the Board (read more on [page 15](#ie3c0f0ecbe744ceeaff4a20772cdfe84_1254)) C. Resources allow the Bank to meet its objectives and measure performance. A framework of controls enables assessment and management of risk (read more in [section 3](#i4cc84f045096445aa974972d72c66d3b_2909) of this report) | | D. Engagement with the Bank's stakeholders is effective and encourages their participation (read more on page 15 to 22) E. Workforce policies and practices are consistent with the Investec Group's purpose and values, and overseen by the Board (read more on page 16). The workforce is able to raise matters of concern and responsibility for whistleblowing arrangements sits with the IBP Audit Committee, as detailed on page 82. | | | | | | | | | | | | | | | | Division of responsibilities | | | | | | F. The Chair has overall responsibility for the leadership of the Board and for ensuring its effectiveness in all aspects of its operations. The Chair, John Reizenstein, was considered to be independent on appointment. The responsibilities of the Chair are set out on page 72. G. There is a clear division of responsibilities at the head of the Company. There is a clear separation between the role of the Chair and CEO. The Board comprises an appropriate combination of Non- Executive and Executive Directors (read more on page 74). | | H. Non-Executive Directors are advised of time commitments prior to appointment. The time commitments of the directors are considered by the Board on appointment, and annually thereafter. External appointments, which may affect existing time commitments, must be agreed with the Chair, and prior approval must be obtained before taking on any new external appointments I. The Board, supported by the Company Secretary, ensures that the correct policies, processes, information, time and resources are available to support its effective and efficient functioning. | | | | | | | | | | | | | | | | Composition, succession and evaluation | | | | | | J. There is a procedure for Board appointments and succession plans for Board and senior management which recognise merit and promote diversity (read more on page 73 to 74). K. There is a combination of skills, experience and knowledge across the Board and the Board committees. Independence, tenure and membership are regularly considered | | L. The annual effectiveness review of the Board and the individual directors considers overall composition, diversity, effectiveness and contribution (read more on page 73 to 74). | | | | | | | | | | | | | | | | Audit, risks and internal controls | | | | | | M. Policies and procedures have been established to ensure the independence and effectiveness of the internal and external audit functions. The Board satisfies itself of the integrity of the Bank's financial and narrative statements (read more on pages 88 to 93). N. The Board presents a fair, balanced and understandable assessment of the Bank's position and prospects (read more on page 92). | | O. Procedures are in place to manage risk, oversee the internal control framework, and determine the nature and extent of the principal risks the Bank is willing to take in order to achieve its long-term strategic objectives (read more on page 42). | | | | | | | | | | | | | | | | Remuneration | | | | | | P. The Bank is committed to offering all employees a reward package that is competitive, performance-driven and fair. Our policies are designed to support the Bank's strategy and to promote its long- term sustainable success, with executive remuneration aligned to our purpose, values and strategic delivery (read more on page [96](#i447e4d363cd344738300acdd42f0e3a0_250)). | | Q. A transparent and formal procedure is used to develop policy and agree executive and senior management remuneration (read more in the remuneration report starting on page 96) R. The remuneration policy seeks to ensure all remuneration decisions made by directors, fully consider the wider circumstances as appropriate, including, but not limited to, individual performance (read more in the Remuneration Report starting on page 96). | | | | | | | | Non-compliance with Provision 12 The Nomination Committee agreed to not appoint a Senior Independent Director (SID) and reconfirmed this position at its meeting in March 2025. While we note the Code requirement for a SID, we are confident that we have sufficient arrangements in place. It is noted that under the Code, the key responsibilities of the SID are to provide a sounding board for the Chair, to serve as an intermediary for the other directors and shareholders, and to appraise the Chair’s performance. Given the structure of the Investec Group, in particular the cross-directorships between the Boards and committees and our culture, we believe that there are sufficient communication channels open for directors. There are existing communication channels available to the Bank Chair from a sounding board perspective, and for other directors and the shareholders and the Investec Group, from an intermediary perspective. This further aligns with the process adopted by the Investec Group’s other principal subsidiaries, which do not have a SID. The assessment of the Chair’s performance will be conducted by the Chair of the Investec Group. 67 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | BOARD AND EXECUTIVE ROLES | | | | | | The key governance roles and responsibilities of the Board are outlined below: | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Chair | | Chief Executive | | Chief Risk Officer | | • Leads the effective operation and governance of the Board • Sets agendas which support efficient and balanced decision-making • Ensures effective Board relationships and a culture that supports constructive discussion, challenge and debate • Together with the Investec Group Chair, leads the development of and monitors the effective implementation of policies and procedures for the induction, training and professional development of all Board members • Oversees the evaluation of the performance of the Board collectively, non-executive Board members individually and contributes to the evaluation of the performance of the Executive Directors • Ensures that the Board sets the tone from the top, in regards to culture • Serves as a senior interface with regulators on behalf of the Bank. | | • Leads and manages the Bank within the authorities delegated by the Board • Proposes and directs the delivery of strategy as agreed by the Board • Develops and recommends business plans, policies, strategies and objectives for consideration by the Board, taking into consideration business, economic and political trends that may affect the operations of the Bank • Ensures the Bank’s culture is embedded and perpetuated across the organisation • Develops and supports the growth of all the Bank’s businesses • Monitors and manages the day-to-day operational requirements and administration of the Bank • Manages the Bank’s risk appetite. | | • Responsible for the effective management of risk within the Bank • Ensures that the Bank’s risk management, conduct and governance processes and procedures are effective • Provides the Board with updates on the Bank’s risk management, conduct and governance processes • Manages within the Bank’s risk appetite. | | | | | | | | Non-Executive Director | | Company Secretary | | Finance Director | | • Brings unique perspectives to the boardroom to facilitate constructive dialogue on proposals • Constructively challenges and contributes to assist in developing the Group’s strategy • Monitors the performance of management against their agreed strategic goals • Oversees the effectiveness of internal controls and the integrity of financial reporting • Reviews succession planning for the Board and management • Oversees the management of risk as set out in the risk management framework • Oversees the remuneration of the Executive Directors and the Bank's employees. | | • Maintains the flow of information to the Board and its committees and ensures compliance with Board procedures • Ensures and keeps the Board updated on corporate governance developments • Facilitates a programme for the induction and ongoing development of directors • Provides advice, services and support to all directors as and when required. | | • Leads and manages the finance function • Provides the Board with updates on the Bank’s financial performance • Provides strategic and financial guidance to ensure that the Bank’s financial objectives and commitments are met • Oversees the financial management of the Bank including financial planning, capital, cash flow and management reporting • Develops all necessary policies and procedures to ensure the sound financial management and control of the Bank’s business. | 68 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | BOARD COMPOSITION | | | | | | | | | --- | | | | Gender diversity | ![4398046511112]() | | | | | --- | --- | --- | | | | | | | Male | 6 | | | Female | 4 | | | | --- | | | | Age | ![4398046511118]() | | | | | --- | --- | --- | | | | | | | 45-50 | 20.0% | | | 51-59 | 40.0% | | | 60-70 | 40.0% | | | | --- | | | | Ethnicity | ![29137058145605]() | | | | | --- | --- | --- | | | | | | | White British or other White | 70.0% | | | Black/African//Black British | 20.0% | | | Asian / Asian British | 10.0% | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Board skills Collective view of the skills, experience and knowledge of our current non-executive directors. | | | | | | | Advanced | | | Intermediate | | Advanced denotes deep experience | | | Intermediate denotes good experience | | ![]() Skills The Board considers the collective skills, knowledge and experience of the directors, when assessing the overall composition and suitability of the Board. In addition to a range of skills, the Board also values the innate difference in approach and thinking styles, which results from the varied backgrounds and experiences of our directors. This is covered more fully in the individual biographies across pages 63 to 65. The skills matrix captures the key skills of our directors, and is used by the IBP Nomination Committee in its annual assessment of the individual suitability of each director and the collective suitability of the Board. During the year, the IBP Nomination Committee, on conducting its assessment, confirmed that it was satisfied that each of the individual directors and the Board collectively were suitable. The skills matrix would continue to evolve to ensure that the skills required in order to support the Bank’s strategy are present on the Board. The Board and IBP Nomination Committee also consider the skills matrix when reviewing the succession plans for the Board and believe that the Board’s skills are appropriate. | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Financial services/ Industry knowledge | | | | Client experience | | | | | | | | | | | | | | | | | | | | | | | | | | | | Technology/Digital | | | | Audit/Finance | | | | | | | | | | | | | | | | | | | | | | | | | | | | Governance | | | | Regulatory/ Government | | | | | | | | | | | | | | | | | | | | | | | | | | | | Risk management | | | | Strategic thinking | | | | | | | | | | | | | | | | | | | | | | | | | | | | Sustainability | | | | | | | | | --- | | | | Attendance at Board meetings | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Meetings held in 2024/25 | | | | | | Members | Meetings attended | Eligible to attend | | | | John Reizenstein (Chair)1 | 7 | 7 | | | | Vivek Ahuja2 | 1 | 1 | | | | Henrietta Baldock | 7 | 7 | | | | Zarina Bassa3 | 1 | 1 | | | | David Germain | 7 | 7 | | | | Ruth Leas | 7 | 7 | | | | Kevin McKenna | 7 | 7 | | | | Paul Seward | 7 | 7 | | | | Brian Stevenson4 | 1 | 1 | | | | Fani Titi | 7 | 7 | | | | Marle van der Walt | 7 | 7 | | | | Lesley Watkins | 7 | 7 | | ![]() 1. John Reizenstein was appointed as Chair on 1 July 2024. 2. Vivek Ahuja was appointed to the Board on 5 March 2025. 3. Zarina Bassa stepped down from the Board on 8 August 2024. 4. Brian Stevenson stepped down as Chair of the Investec Bank plc Board and as a non-executive director on 1 July 2024. 5. Where a director is unable to attend a meeting, they receive papers in advance and have the opportunity to provide comments to the Chair. 6. In addition to the meetings held, there was an additional Board strategy day in November 2024 which was attended by the Board at that time as well as the IBP Executive Committee and other senior executives from key jurisdictions. 69 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | BOARD ACTIVITIES | | | | | | #### What we ![]() | | | --- | | | | Strategy | | Strategic initiatives | | The Board reviewed the key strategic initiatives, including the potential opportunities for expansion in Europe and India, further development of the Bank’s fund solutions business and enhancing the Bank’s Private Client offering. The Bank continued its oversight of the transition between Investec Wealth and Investment Limited (IW&I) and Rathbones plc (Rathbones) which had been progressing well. As part of the transition, the Bank migrated from traditional services to utilising the strategic partnership with Rathbones via a focus on the volume of referrals. | | | #### did in 2024/25 ![]() The following pages outline the key topics reviewed, monitored, considered and debated by the Board in 2024/25. Board meeting discussions are structured to allow for strategic discussions, consideration of key risks and monitoring of the Bank’s culture with the agenda being agreed in advance by the Chair, in conjunction with the CEO and the Company Secretary. ![]() | | | --- | | | | Financial | | | | Budget | | The Board considered performance versus the 2024/25 budget. The Board also agreed the 2025/26 budget with key areas of challenge relating to ensuring there was sufficient capital for investing in the IT infrastructure, digitising the business for future growth and other capabilities as well as ensuring diversified revenues. | | | | Going concern and viability statement | | The Board received and approved the going concern and viability statements. | | | | Results | | The Board reviewed and approved the full year results. | | | ![]() ![What we did pic 01.jpg]() 70 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | BOARD ACTIVITIES CONTINUED | | | | | | | | | --- | | | | | | Governance | | | | Committee reporting | | The Board received written committee reports from the Chairs of our Board committees and the DLC Social and Ethics Committee on the proceedings at those meetings, including the key discussion points and particular matters to bring to the Board’s attention. | | What we did pic 02.jpg | | | | | --- | --- | | | | | | | | | | | Matters Reserved for the Board | | | The Board approved the Schedule of Matters Reserved for the Board following a comprehensive review. | | | Board effectiveness review | | | This year’s Board effectiveness review was conducted externally by Fidelio Partners, the outcome of which was discussed by the Board along with the actions arising from it. The Board gained comfort that it was appropriately constituted with sufficient skills and knowledge. The Board also reviewed progress made against the action plan for 2024/25. | | | | | | | Read more on page 73. | | | | | | | --- | | | | | | Risk and assurance | | | | Risk profile | | The Board reviewed and debated the overall risk profile, particularly the principal risks, emerging risks and risk appetite. The Board approved the risk appetite ensuring that there was adequate diversification, reducing concentration and country risk while enabling the Bank to achieve its strategic objective of growth. The Board continued to monitor and challenge the risk profile of the Bank responding to the ongoing macro-economic environment focusing on the key financial risks, in particular liquidity, market risk and credit quality. | | Risk management | | The Board reviewed the management systems, including financial, operations and compliance controls, and reviewed the effectiveness of the Bank’s key internal control systems. | | | | | | --- | | | | | | Regulatory matters | | | | Projects | | The Board reviewed the progress of key regulatory projects including the redevelopment of IFRS 9 models, and the transition to the IRB approach. The Board reviewed and closely monitored the Bank’s progress towards a Resolvability Assessment Framework (RAF) and the Minimum Requirement for own funds and Eligible Liabilities (MREL) requirements. | Regulatory interaction There was regular interaction with the PRA and FCA through the participation in reviews and discussing proposed changes within the Bank including the Board's approach to succession planning. Regulatory documents The Board reviewed and approved the key regulatory documents including the Management Responsibilities Map, the CASS attestation, the Contingency Funding and Recovery Plan and Resolution Pack (CFRP), ILAAP and ICAAP. The FCA undertook a holistic review on the Bank’s Consumer Duty compliance, with the results being rated as green. Following this positive result and the announcement that it was no longer expected for firms to have a Consumer Duty Champion, the Board oversaw the decision that the role was no longer required. | | | | --- | --- | | | | | | Read more on page 83 | ![Risk management and assurance pic.jpg]() | | | --- | | | | | | Purpose, culture and values | | | | Culture and values | | The Board monitored and assessed culture, receiving regular updates from the Head of People and Organisation. The Board also received regular updates on the output from workforce engagement activities, townhalls and diversity workshops among other activities. | | | | | --- | --- | | | | | | | | | | | People strategy, leadership and succession | | | | | | Non-executive succession | | | The Board oversaw the arrangements for Board succession planning with Brian Stevenson stepping down as Chair of IBP and Non-Executive Director of Investec Bank plc in July 2024 and Zarina Bassa stepping down from her roles as a member of the IBP Board and IBP Audit Committee in August 2024. | | The Board, following an extensive process, approved the appointments of John Reizenstein as a Non-Executive Director who was appointed Chair of Investec Bank plc on 1 July 2024 and Vivek Ahuja who was appointed as a Non-Executive Director on 5 March 2025. | | | | --- | --- | | | | | | Board succession | Particular focus was given by the Board to succession planning for the non-executives, in addition to the appointments of John and Vivek, taking into consideration exposure to the Board, representation on the committees and technical development. | | | | --- | --- | | | | | | Read more on page 73. | 71 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP NOMINATION COMMITTEE REPORT | | | | | | | | | | | --- | --- | --- | | | | | | | | John Reizenstein Chair of IBP Nomination Committee | | | | | | We are committed to ensuring that the Board has the right skills, knowledge and experience to operate efficiently and promote the long term success of the Bank | | | | #### Introduction I am pleased to present the IBP Nomination Committee (the Committee) report. The role of the Committee is to ensure oversight of the composition and effectiveness of the Board and its committees together with key governance arrangements. As the Committee indicated in last year’s report, Brian Stevenson retired as Chair of the Committee on 1 July 2024, at which time I was appointed in Brian’s place. I am thankful to Brian for laying the strong foundations that will support our progress and feel privileged to be leading the IBP Board and the Committee in the years to come. #### Succession planning In another busy year for the Committee, we have continued to emphasise succession planning for the Board and subsidiary Boards with a particular focus on non-executive succession. In support of the Bank’s growth strategy, the Committee paid attention to the balance of collective skills while also aligning to the Bank’s culture and its values of diversity and inclusion. With Brian retiring and Zarina Bassa stepping down at the AGM on 8 August 2024, there was a focus from the Committee on non-executive succession. The Board was delighted to appoint Vivek Ahuja on 5 March 2025 as a member of the Board, Remuneration Committee, Audit Committee and Board Risk and Capital Committee. Vivek brings a wealth of experience and expertise across the financial and private equity sectors and we all greatly look forward to working with him. The Committee also had regard to the principles of the UK Corporate Governance Code as well as recommendations made within the Parker and FTSE Women Leaders Review. #### Board effectiveness The Committee oversaw the Board effectiveness review and assessed the feedback from the evaluation process. In keeping with the recommendations of the Financial Reporting Council's (FRC's) UK Corporate Governance Code 2024, this year, the Board effectiveness review was externally facilitated by Fidelio Partners, an independent, external corporate governance advisory firm. Full details of the board effectiveness review, including the evaluation of the Committee’s effectiveness are provided in the Committee report. #### Roles and responsibilities The role of the Committee is to keep the Board's composition, skills, experience, knowledge, independence and succession arrangements under review and to ensure that appropriate procedures are in place for nominating and evaluating all directors. The Committee reports to the board on how it discharges its responsibilities and makes appropriate recommendations to the board. #### Board diversity The Committee ensured that the Board considered diversity when reviewing the Board and Board committee composition and its succession planning. The Committee remained committed to selecting the best candidates based upon skills and experience and also focused on ensuring diversity within the Board and management team. Due regard is given to gender, ethnicity and social background, as well as diversity of thought. 72 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP NOMINATION COMMITTEE REPORT CONTINUED | | | | | | #### Role of the Chair The Chair of the Committee meets regularly with the executives of the Bank. The Chair also has interactions with specialist advisers and with the Heads of People and Organisation, Risk, Compliance and Company Secretarial, in order to maintain up- to-date knowledge, and to keep abreast of commercial, regulatory and legislative developments. These interactions are an essential part of the role of the Chair. Committee composition, attendance, #### skills and experience The Committee comprises of an independent Non-Executive Director together with the Group Chair and the Bank Chair, both of whom were independent on appointment. The Committee’s composition is designed to provide the breadth of experience necessary for the members to properly consider the issues that are presented to them. The Chief Executive of the Bank is invited to attend meetings as appropriate. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Meetings held in 2024/25 | | | | | | Members | Member since | Meetings attended | Eligible to attend | | | John Reizenstein (Chair) | 1 Jul 2024 | 6 | 6 | | | Philip Hourquebie | 5 Aug 2021 | 6 | 6 | | | Lesley Watkins | 1 Feb 2023 | 6 | 6 | | | Brian Stevenson1 | 16 May 2021 | 1 | 1 | | | | | | | 1. Brian Stevenson stepped down from the Committee on 1 July 2024. #### Looking ahead In 2025/26, the Committee will continue to review the composition of the Board and its committees with regard to those non-executive directors approaching their nine-year anniversaries. In doing so, the Committee will take into consideration the Bank’s strategy and evolving market conditions while being mindful of all aspects of diversity, including gender, ethnicity, skills, experience and knowledge. The Committee will focus on the executive and non-executive succession plans. The Committee will continue to monitor compliance with the UK Corporate Governance Code, particularly in light of the revised 2024 Code and Provision 29 in particular. The Committee will also oversee the implementation of the Board effectiveness action plan. #### John Reizenstein Chair, IBP Nomination Committee 19 June 2025 73 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP NOMINATION COMMITTEE REPORT CONTINUED | | | | | | #### What we did in 2024/25 #### Succession planning Robust succession planning takes into account current and future business needs and ensures a good balance of skills, experience and effectiveness, while recognising the benefits of diversity. In addition it should consider account contingency planning (for any unforeseen absences) and long-term planning (looking ahead to the skills, experience and knowledge that may be required on the Board in the future). In this way, effective succession planning can contribute to the ability of the Bank to deliver on its strategic objectives. The Committee reviewed the succession plan for the Board during the year, identifying skills required with particular focus on non-executive director succession. As already noted, Zarina Bassa stepped down from her role as a member of the Board and Audit Committee, and Brian Stevenson stepped down from the roles of Chair of Board, Chair of Nomination Committee and member of Board Risk and Capital Committee. John Reizenstein was appointed as a notified Non-Executive Director with effect from 2 April 2024, succeeding Brian as Chair of Board, Chair of Nomination Committee and a member of the Board Risk and Capital Committee as of 1 July 2024. Following these changes, it was decided to undertake a search for an additional non-executive director. An external search consultant -Odgers- which does not have any other connection to Investec or any individual directors-was used as part of the recruitment process. After taking into account a broad range of factors, Vivek Ahuja was identified as the preferred candidate and was recommended to and approved by the Board. Vivek was appointed as a notified Non-Executive director from 5 March 2025. Vivek's executive and non-executive experience, particularly in the financial services sector, means that he brings a wealth of experience to the Board. A tailored induction programme was put in place for Vivek and overseen by the Committee. The Committee placed emphasis on the importance of the continued development of the Board and planning for the future. Focus was therefore given to the long-term succession planning for the Board and its committees in addition to the appointments of John and Vivek, taking into consideration exposure to the Board, representation on committees and technical development. #### Subsidiary Board connectivity The Committee also considered the connectivity between the Board, its subsidiaries and their non-executive directors in the context of the development and execution of the Group's strategy. Various actions were taken during the year, with CEOs of key IBP subsidiaries invited to attend the Board and/or the Board Strategy day to present deep dives on their businesses. An extensive and well-established understanding of the Bank's subsidiaries and their activities is recognised as a key way to maintain oversight and ensure that the the Bank’s strategy is being implemented effectively. The Bank’s Chair also meets with members of the key subsidiary Boards in order to foster connectivity. #### Board effectiveness The Board effectiveness review provides an opportunity for the Board to consider ways of identifying greater efficiencies, maximising strengths and highlighting potential areas of further development, to enable the Board to continue to enhance its own performance. In the previous two years, internal reviews by way of questionnaires and interviews were conducted by the Chair with the assistance of the Company Secretary. Although the 2023 internal effectiveness review found that, overall, the Board, its committees and each of the directors were effective, it also highlighted certain areas of focus that would further improve effectiveness. These were considered by the Board and an action plan was agreed. The principal action items identified from the 2023 review were (i) to increase the focus on sustainability; (ii) to enhance subsidiary reporting; and (iii) to further improve the focus on long-term strategy. The Committee is pleased to report that the actions identified to address the findings were completed throughout the year. In keeping with the recommendations of the FRC's UK Corporate Governance Code 2018, this year, the Board effectiveness review was externally facilitated by Fidelio Partners – who do not have any other connection to Investec or any individual director. Below we outline the various stages of the 2024 review: Stage 1: Fidelio Partners held in-depth one-on-one meetings with each of the directors. These interviews were based on open questions covering key aspects of governance. 74 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP NOMINATION COMMITTEE REPORT CONTINUED | | | | | | Stage 2: Fidelio Partners prepared a quantitative survey, in which the directors provided feedback on the key competences and overall performance of the board. Stage 3: Fidelio Partners reviewed and analysed Board and Board committee materials, including agendas, papers, minutes and terms of reference, and attended Board and certain committee meetings. Stage 4: Drawing upon best practice within the sector, their extensive experience of working with Boards internationally, and their understanding and insight of stakeholder expectations, Fidelio Partners determined their key findings and recommendations. The conclusions of the review were presented to the Board in March 2025. A thorough discussion took place, with actions agreed with the Committee for implementation and monitoring at the May 2025 meeting. Conclusions: The review identified that the board, its committees and the individual directors were performing effectively. The findings showed that against a backdrop of much- improved business performance, the Board was perceived to be strong with a diverse composition, a good overall dynamic and a record of providing diligent oversight. In terms of recommended enhancements, the report grouped the output into five core themes: Board oversight of growth objectives, continued development of strategy and oversight, continued development of oversight of the people agenda, ensuring ongoing Board learning; and, the continued development of the voice of Investec Bank plc in the context of the Investec Group. These were considered by the Committee and the Board and an appropriate action plan was agreed. The action plan for 2025/26 includes: • Further enhance ways in which the Board can contribute to strategy and oversee progress against strategic objectives in addition to the annual report Board Strategy day • Ensure that at Board and Committee level there is scope to focus on the key risks facing the business, and the opportunity to challenge the risks • Enhance the way in which the Board gains assurance that the culture is embedded in Board learning • Maintain Board oversight of the executive pipeline and succession planning initiatives to offer more deliberate development pathways within Investec Bank plc. The IBP Nomination Committee will continue to monitor the progress of the implementation of the action plan. #### Board composition The Committee has continued to review the composition of Board and its committees with particular regard to the breadth of skills, knowledge and experience as well as diversity of members. The Committee keeps under review and consideration the balance of non-executive directors and executive directors, tenure and diversity including gender balance. The composition of the Board can be seen in the directors’ report on page 88. In terms of key considerations, as at the date of this report: • 40% of the Board are female • 30% of the Board are Black, Asian and Minority Ethnic • 60% of the Board are non-executive directors • All non-executive directors have served on the Board for less than nine years. #### Board suitability In order to provide assurance that the composition of the Board was appropriate and in line with internal procedures and regulatory guidance, the suitability assessment of the Board was conducted in July 2024, with the Committee reviewing the feedback in the financial year. A skills matrix has been developed for the annual assessment of the individual suitability of each director and the collective suitability of the Board. There were no matters of concern raised and the Committee was satisfied that all non-executive directors remained independent in character and judgement. The review provided the Committee with assurance that the composition of the Board was appropriate to support the Bank’s strategy. This matrix is being developed to look forward to emerging skills and requirements, enabling the Committee to plan the skills the Bank will need on the Board in the coming years. #### Conflict of Interest Each director has a duty to disclose any actual or potential conflict of interest, as defined by law, for consideration and approval if appropriate by the Board. Additionally, the Board and its committees consider conflicts of interest at the beginning of every meeting. #### Diversity New appointments are made on merit, taking account of the specific skills and experience, independence and knowledge needed to ensure a rounded Board and the diverse benefits each candidate can bring to the Board and its committees as a whole. The Committee maintains the Board Diversity and Inclusion Policy which sets out the approach to the diversity of the Board of Directors and provides a high-level indication of the Board’s approach to diversity for senior management roles. There are also measurable objectives including but not limited to, aspiring to meet the recommendations of the FTSE Women Leaders Review and the Parker Review. The Bank has also signed up to the HM Treasury Women in Finance Charter and the Race at Work Charter. Diversity will remain an area of focus when considering any succession plans. For further information on the Bank’s broader approach to belonging, inclusion and diversity please refer to the Investec Group’s 2025 sustainability report which is published and made available on our website www.investec.com 75 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP AUDIT COMMITTEE REPORT | | | | | | | | | | | --- | --- | --- | | | | | | | | Lesley Watkins Chair of the IBP Audit Committee | | | Ensuring the continued enhancement of financial reporting and controls remains a key focus to provide assurance to our stakeholders | | | | #### Introduction I am pleased to present the report of the IBP Audit Committee (the Committee) for the financial year ended 31 March 2025. The Committee continued its focus on the key accounting judgements. Of particular note were the assumptions going into the expected credit loss (ECL) calculations and the valuation of level 3 instruments, given the level of subjectivity. A number of technical accounting matters in the financial year were also debated with management and Deloitte. In particular, these included the change to the face of the income statement and the presentation of equity-accounted earnings in relation to the investment in Rathbones. Other matters relating to the Rathbones investment were resolved in the financial year including the purchase price allocation and the inclusion period given the different reporting periods. As a result, Investec has included the Rathbones results three months in arrears. Based on guidance, income from associates has now been prepared in a single line in accordance with the IFRS requirements and the reconciliation can be found in [note 28](#i447e4d363cd344738300acdd42f0e3a0_379). The Committee also reviewed the findings raised by Deloitte and other judgemental items in the financial statements,for example management’s assessment of valuations of the Bank’s principal investments, certain aircraft leasing arrangements as well as the minimum service provision attached to the acquisition of a controlling stake in Investec Continental Europe Advisory. As previously advised, in January 2024, the Financial Conduct Authority (FCA) announced that it was undertaking a review of the discretionary commission arrangements in the motor vehicle finance market prior to 2021. There have been a number of developments during the financial year including the Court of Appeal’s ruling. The Supreme Court also considered the matter in April 2025 with a ruling expected in July 2025. As the Bank has an exposure to this industry through the Mann Island business, the Committee debated the appropriateness of a provision. In conclusion, although it was recognised that the Mann Island business had been and continued to be compliant with all regulations in the period, the Committee agreed with management that the level and methodology of the provision remained appropriate. Further details of the key accounting issues considered by the Committee are set out on the following pages. The Committee continued to oversee the progress being made to ensure compliance with Provision 29 of the FRC’s UK Corporate Governance Code 2024 which relates to the board declaration of effectiveness of risk management and internal controls. The declaration would be applicable for the financial year ending 31 March 2027, which is a year later than the other changes within the Code. The Bank is also subject to the Corporate Sustainability Reporting Directive (CSRD) as it has bonds listed on the Euronext stock exchange. As a result, the Committee closely monitored the progress of the project to ensure adherence, as well as the assurance work provided by Deloitte. Throughout the financial year, amendments were published in terms of new Global Internal Audit Standards and the Internal Audit Code of Practice Principles on Effective Internal Audit. The Committee reviewed the updated standards and were kept updated as internal audit worked to close any gaps and update any necessary documentation or processes. The Committee was also kept updated on the external quality assurance review (EQAR) of the internal audit function that took place during the financial year and received a presentation on the key findings. The Committee was assured that overall, the internal audit framework is appropriate for the size and complexity of the Investec business and the function is broadly compliant with the relevant standards. Finally, the Committee reviewed the output of the internal audit and compliance monitoring plans with a focus on ensuring the timely remediation of findings. It received updates from management’s Risk and Controls Forum, with a particular focus on compliance, operational risk, information technology (IT) controls, particularly in terms of privileged access management, cyber security and operational resilience. The Committee received assurance that the control environment continued to be enhanced and the risk and control consciousness within the Bank was mature. Further details of the internal control issues considered by the Committee during the year are set out on the following pages. 76 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP AUDIT COMMITTEE REPORT CONTINUED | | | | | | How the Audit Committee works The IBP Audit Committee’s principal responsibilities are to: • Monitor the integrity of the Bank’s financial reporting and satisfy itself, having regard to any issues raised by the external auditor, as to the appropriateness of management’s accounting policies and practices; assess that any significant financial judgements, assumptions or estimates made and the disclosures recommended by management are appropriate; and assess whether overall the annual report, taken as a whole, is fair, balanced and understandable; and provides the information necessary for stakeholders to assess the Bank’s position and performance, business model and strategy • Review the effectiveness of the Bank’s key internal controls, including internal financial controls • Monitor the activities and the performance of the internal and external auditors (including monitoring their independence and objectivity) • Oversee the relationship with the Bank’s external auditor • Review and monitor the effectiveness of the Bank’s whistleblowing policies and procedures. • In the past, the Committee had responsibility for overseeing the compliance function including compliance monitoring. This responsibility moved to the IBP Board Risk and Capital Committee in February 2025. Composition, meeting attendance, and interaction with Investec Group In accordance with the Code, the Committee entirely comprises independent non-executive directors who meet predetermined skills, competency and experience requirements as determined by the IBP Nomination Committee. The members’ continuing independence, as well as their required skills, competencies and experience is assessed annually. The CEO and Finance Director of the Bank attend meetings on a regular basis but are not members. Other Bank directors may also attend by invitation. The Head of Risk, Head of Internal Audit, Head of Compliance, the external auditor and the Company Secretary also attend meetings on a regular basis. The Committee meets alone with the external auditor and, separately, with the Head of Internal Audit. Committee members also meet periodically with management and the Heads of Internal Audit, Compliance, Operational and IT risk, and Finance as well as the lead external audit partner and senior management in order to keep knowledge up to date, and to keep abreast of commercial developments and challenges facing the business. The Chair of the Committee is also a member of the IBP BRCC and, similarly, the Chair of IBP BRCC, Paul Seward, is a member of this Committee. This reciprocity of membership helps to ensure interaction between these two committees and a coordinated consideration of the Bank's risks and internal controls where they overlap in relation to both financial risks and non-financial risks, reflecting the holistic oversight of risk at Board level. The Committee reports formally to the Board. As previously advised, Zarina Bassa stood down as a non-executive director of the Investec Group, Investec Bank plc and Investec Bank Limited and resigned on 8 August 2024. Following this, Diane Radley was appointed as Chair of the DLC Audit Committees, on 8 August 2024 and was also appointed as a member of this Committee. This dual appointment reflects the dual listed structure of the Investec Group in which Investec Bank plc is the principal banking subsidiary in the UK and the parent company of other material overseas subsidiaries. The representation of the Investec Group Audit Committee Chair ensures that key audit matters for the Bank and its subsidiaries are visible at the Investec Group level, and likewise that key audit matters and matters of mutual interest for the Investec Group and Investec Bank plc are communicated and addressed, where applicable, in the Bank and its subsidiaries. I would again like to thank Zarina for her contribution to the Committee during her time at Investec and as a member of the Committee. We also welcomed Vivek Ahuja to the Audit Committee following his appointment to the IBP Board on 5 March 2025. Vivek’s skills and experience further strengthen the skills and experience of the Audit Committee. | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | Members | Member since | Eligible to attend1 | Attended | | | | Lesley Watkins (Chair) | 13 Nov 2018 | 7 | 7 | | | | Zarina Bassa2 | 1 Apr 2017 | 3 | 3 | | | | Paul Seward | 1 Apr 2019 | 7 | 7 | | | | Diane Radley3 | 8 Aug 2024 | 4 | 4 | | | | VIvek Ahuja4 | 5 Mar 2025 | 1 | 1 | | 1.Where a director is unable to attend a meeting, they receive papers in advance and have the opportunity to provide comments to the Chair of the Committee. 2.Zarina Bassa stepped down from the Board and Committee on 8 August 2025. 3.Diane Radley was appointed as a member of the Committee on 8 August 2025 4. Vivek was appointed to the Board and BRCC on 5 March 2025. 77 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP AUDIT COMMITTEE REPORT CONTINUED | | | | | | External audit As mentioned last year, Investec plc and the Bank undertook a comprehensive audit tender process with Deloitte LLP (Deloitte) being nominated as the new external auditor for Investec plc and the Bank. DLC shareholder approval was received at the AGM in August 2024. Following a shadow period Deloitte commenced the role for the audit of the financial year ended 31 March 2025. The Committee continuously assesses the effectiveness, objectivity and independence of the external auditors at formal Committee meetings, during private meetings with Deloitte and through discussions with key executive stakeholders. The Committee considers the relationship with the auditor to be working well and remains satisfied with their effectiveness. The Committee monitored whether the level of non-audit fees could impact the independence of the auditors having regard to the nature of the services rendered and the fees paid as a proportion of the overall audit fee. The Committee was satisfied that the quantity and type of non-audit work undertaken throughout the year did not impair the independence of Deloitte. | | | | --- | --- | | | | | | Further details in regards to the audit fees paid are provided in [note 7](#i447e4d363cd344738300acdd42f0e3a0_304) of the annual financial statements. | Looking ahead The Committee will continue to assess the changes in the business environment and understand the implications of these on accounting requirements and internal controls. The Committee will also review and challenge the adequacy of the internal audit plan and budget, as well as the combined assurance matrix coverage plan, to ensure adequate oversight of the control environment. The Committee will also continue to receive assurance from internal audit in relation to key regulatory projects including RAF and IRB. Furthermore, the Committee will continue to monitor and challenge the progress to comply with the updates to Provision 29 of the FRC’s Corporate Governance Code 2024. The Committee will focus on understanding the controls and enhancements as well as the testing of the controls ahead of the March 2027 deadline. As previously mentioned, the Committee will closely monitor any regulatory developments, including the outcome of the FCA’s review on discretionary commission arrangements within the motor finance market and any implications for the agreed provision. ![image.png]() #### Lesley Watkins Chair, 19 June 2025 78 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP AUDIT COMMITTEE REPORT CONTINUED | | | | | | #### Significant matters Significant matters are those matters that in the view of the IBP Audit Committee: • Required significant focus from the Committee • Were considered to be significant or material in nature requiring exercise of judgement • In relation to the 2025 annual report and financial statements were otherwise considered to be subjective from an accounting or auditing perspective. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Significant matters relating to the 2025 financial statements | | What we did | | | | Expected credit loss (ECL) assessment The appropriateness of the allowance for ECLs is highly subjective and judgemental. The impact of geopolitical tension and the resultant economic impacts in the geographies in which the business operates have resulted in key judgements and assumptions being made during the current year. The work conducted in terms of ECL is carried out in conjunction with the BRCC. | | • Reviewed and challenged the appropriateness of the forward-looking macro-economic scenarios and assumptions (including the probability weights applied to each scenario and the sensitivity of each) used in credit models and the impact of these on forecast ECL • Evaluated the appropriateness of and methodology for management’s proposed ECL overlay to capture model limitations and economic uncertainty noting the ongoing work to address model shortcomings • Challenged the level of ECL and the assumptions used to calculate the ECL provisions held • Assessed ECL experienced against forecasts and peers and considered whether the level of ECL was appropriate. Particular focus was given to exposures which were specifically affected by a high inflation and high interest rate economic environment • Evaluated the IFRS 9 disclosures for relevance and compliance with IFRS. | | | | | | | | | | Valuation of fair value instruments with higher risk characteristics and associated income For level 3 instruments, such as unlisted investments in private equity businesses, fair value loans and large bespoke derivative structures and structured products, there is a large degree of subjectivity and judgement surrounding the inputs to the valuations. | | • Received reports on the material investments including an analysis of the key judgements and assumptions applied and approved the valuation adjustments proposed by management for the year ended 31 March 2025 • Received reports on and considered the valuation of financial instruments with higher risk characteristics • Challenged and debated significant subjective exposures and assumptions including: – the valuation principles applied for the valuation of level 3 investments (unlisted and private equity investments) and fair value loans – fair value of exposures in industries affected by the effects of the high inflationary, high interest rate environment and the geopolitical instability and conflicts – the appropriateness of the IFRS 13 disclosures on fair value. | | | | | | | | 79 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP AUDIT COMMITTEE REPORT CONTINUED | | | | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Significant matters relating to the 2025 financial statements (continued) | | What we did | | | | Uncertain tax, contingent liabilities and other legal matters | | • Considered potential legal and uncertain tax matters and contingent liabilities with a view to ensuring appropriate accounting treatment in the financial statements • Evaluated the appropriateness of the accounting and disclosures regarding the investigation by the Office of the Public Prosecutor in Cologne, claims by the German Federal Tax Office in Bonn, and the potential related civil claims. This was conducted via closed sessions with executive management and external audit. At these meetings, the Committee considered the feedback as received from external and internal legal counsel and the probability of the outcomes. [Refer to note](#i447e4d363cd344738300acdd42f0e3a0_436) [47 of the annual financial statements](#i447e4d363cd344738300acdd42f0e3a0_436) • Received updates from Group Legal on uncertain tax, legal and regulatory matters to enable the Audit Committee to probe and consider the matters and evaluate the basis and appropriateness of the accounting treatment and disclosure • Analysed the judgements and estimates made and discussed the potential range of outcomes that might arise to determine the liability, if any, for uncertain tax positions as required by the International Financial Reporting Interpretations Committee (IFRIC) 23 • Concluded on the appropriateness of the IAS 37 accounting treatment and the overall disclosure in the financial statements. Conferred with and received confirmation from the external auditors on the overall treatment. | | | | | | | | | | Conduct risk provisions Determining the expected costs of any remediation which may be required as a result of the FCA’s industry-wide review of historical motor finance commission arrangements requires management judgement | | • Received updates on the developments following the Court of Appeal’s judgement • Received updates from management on their review of rate and commission structures, the controls in place and outcome for customers following the Court of Appeal’s ruling and received confirmation that documentation had been amended to ensure it remained compliant • Reviewed the approach to estimating the costs of any remediation measures which may be proposed and the appropriateness of the provision • Considered the disclosure of this matter made in the annual financial statements • Refer to [note 47](#i447e4d363cd344738300acdd42f0e3a0_436) of the annual financial statements. | | | | | | | | | | Going concern and viability statement | | • Considered the Bank’s profitability, Board-approved budgets and capital plans through to June 2028, liquidity, operational risk and contingent liabilities. • Recommended the approval of the going concern and the viability statement assumptions underlying the financial statements to the Investec Bank plc Board for approval. | | | | | | | | | | | | | | 80 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP AUDIT COMMITTEE REPORT CONTINUED | | | | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Significant matters relating to the 2025 financial statements (continued) | | What we did | | | | Fair, balanced and understandable reporting The Bank is required to ensure that its external reporting is fair, balanced and understandable, and whether it provides the information necessary for stakeholders to assess the Bank’s position and performance, business model and strategy. | | • Met with senior management to gain assurance that the processes underlying the compilation of the annual financial statements were appropriate • Conducted an in-depth, critical review of the annual financial statements, including the accounting policies used and, where necessary, agreed amendments to disclosure • Challenged and reviewed the accounting treatment for the acquisition of a majority interest in Investec Continental Europe Advisory and the investment in Rathbones with a particular focus on the presentation of equity-accounted earnings in relation to the investment in Rathbones and the amendment to the accounting treatment of Investec Capital Services India Pvt Limited. Based on guidance, income from associates would now be prepared in a single line in accordance with the IFRS requirements and the reconciliation can be found in [note 28](#i447e4d363cd344738300acdd42f0e3a0_379) • Reviewed the accounting treatment of key judgements • Assessed disclosure controls and procedures • Considered in particular the disclosures relating to climate change and CSRD • Confirmed that management had reported on and evidenced the basis on which representations to the external auditors were made • Concluded that the processes underlying the preparation of the annual report and financial statements for the year ended 31 March 2025 were appropriate in ensuring that those statements were fair, balanced and understandable • Obtained input and assurance from the external auditors and considered the level of, and conclusion on, the summary of audit differences • Received updates on the CSRD project • Considered post balance sheet events and determined that they were non-adjusting in terms of the IAS 10 requirements • Recommended to the Board that the 2025 annual report and financial statements were fair, balanced and understandable. | | | | | | | | | | External audit | | • Managed the Bank’s relationship with the external auditor • Met with key members of the Deloitte audit team to discuss and then approve the 2024/25 audit plan and agree key areas of focus • Assessed regular reports from Deloitte on the progress of the 2024/25 audit and material accounting and control issues identified • Discussed Deloitte’s feedback on the Bank’s critical accounting estimates and judgements • Discussed Deloitte’s report on certain control areas, including IT and the control environment, ahead of the 2025 financial year end • Assessed the performance, independence and objectivity of the external auditors. | | | | | | | | 81 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP AUDIT COMMITTEE REPORT CONTINUED | | | | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Other significant matters | | What we did | | | | Internal controls and the business control environment | | • Received regular reports from management’s Risk and Controls Forum and the Head of Compliance and Internal Audit on Investec Bank plc and subsidiaries within the Committee’s terms of reference. Based on this reporting, evaluated the impact of evolving risk, including operational risk, on the internal control environment, including IT, data and cyber security. The reports from management’s Risk and Controls Forum and the Head of Compliance have been tabled at the IBP BRCC since February 2025 as the scope of the Committee and BRCC has changed • Evaluated and tracked the status of material control issues identified by internal and external audit and tracked the progress of the associated remediation plans against agreed time frames. Particular attention was paid to the effectiveness of IT general controls and controls impacting financial reporting as well as privileged access management and the risk of data leakage • Evaluated reports on the internal control environment from the internal and external auditors • Assessed reports on individual businesses and functions on their control environment, discussed identified control failures and closely monitored the status of remediation plans • Requested confirmation from management regarding the remediation of issues identified, including the time frames and accountability for remediation • Reviewed and approved the compliance monitoring plan and received regular updates prior to the reallocation of responsibility to the IBP BRCC in February 2025 • Reviewed the results of the Combined Assurance Matrix coverage plan to assess the results of actual coverage and conclusions • Reviewed the internal and external CASS assurance reports on client money and assets • Received updates on the project that had been established to ensure compliance with Provision 29 of the FRC’s Corporate Governance Code 2024. | | | | | | | | | | | | | | 82 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP AUDIT COMMITTEE REPORT CONTINUED | | | | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Other significant matters (continued) | | What we did | | | | Internal audit | | • Agreed the internal audit plan taking into account the risk assessment, methodology and resourcing • Approved the internal audit budget • Monitored the delivery of the agreed plan • Received regular reports from internal audit of all significant issues identified by them • Received regular updates of the assurance work being conducted in relation to the Resolvability Assessment Framework (RAF) and IRB projects • Tracked the levels of high and moderate risk findings and monitored the related remediation plans • Met with the Head of Internal Audit, without management being present, to discuss any issues arising • Monitored the skill set, independence and objectivity of internal audit and considered succession and resource planning. The Committee confirmed it was satisfied that Internal Audit had the appropriate resources to adequately complete the internal audit plan and any additional reviews as deemed necessary • Considered the results of the external quality assessment of Internal Audit • Received an opinion from Internal Audit on the effectiveness of the internal controls and the risk management framework, as part of the year-end sign-off process • Monitored audit quality in relation to Internal Audit reviewing the methodology, process and skills • Concluded on the effectiveness and impact of the Internal Audit function • Reviewed and approved the Internal Audit Charter ahead of final approval by the Group Audit Committee • Approved the purpose and mandate of the Internal Audit function as outlined within the Internal Audit Charter • Received updates on the new Global Internal Audit Standards and the Internal Audit Code of Practice Principles on effective Internal Audit, both of which had been amended and became effective in January 2025. The Committee reviewed the mapping analysis and the actions required to become fully compliant • Considered the results of the internal review of the Internal Audit function and the external quality assurance review (EQAR) conducted by EY and reviewed the plan to address the areas for improvement. | | | | | | | | | | Whistleblowing | | • Received and considered reports from management on the Bank's whistleblowing arrangements • Reviewed the reports to ensure that there were arrangements in place that colleagues could use to report concerns about inappropriate and unacceptable practices, in confidence and anonymously without fear of retaliation. Ensured t hat there was proportionate and independent investigation of such matters or appropriate follow-up • Considered the independence and effectiveness of the Bank’s policies and procedures on whistleblowing • Recommended the IBP Whistleblowing Policy ahead of final approval by the IBP Board. | | | | | | | | 83 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP BOARD RISK AND CAPITAL MANAGEMENT REPORT | | | | | | | | | | | --- | --- | --- | | | | | | | | | | | Paul Seward Chair of IBP BRCC | | | Our commitment to strong risk management is key to navigating the challenging environment and enabling the Bank to succeed | | | | #### Introduction I am pleased to present the report on how the IBP BRCC (the Committee) has discharged its responsibilities during the year. The Committee continues to monitor and challenge the risk profile of the Bank responding to the ongoing macro-economic environment with a focus on the key financial risks, in particular liquidity, market risk and credit quality. The UK has continued to be a higher interest rate environment with rates reducing at a slower-than-anticipated pace and lack of consumer confidence and business sentiment negatively impacted following the Autumn budget. In addition, geopolitical tensions, including the Russian invasion of Ukraine and the conflict in the Middle East, along with trade tensions that have escalated in response to the new US administration's economic policies have contributed to the market disruption and increased risk environment. The Committee continues to closely monitor developments following the announcement that the FCA was reviewing historical motor finance commission arrangements prior to the 2021 rule change. Actions have been taken to ensure compliance with the changes in line with the Court of Appeal’s judgement, and a broader review of commission-based businesses has been conducted. A number of key regulatory projects are underway and these continue to be closely monitored by the Committee. They include the migration from the Standardised Approach to the Internal Ratings Based (IRB) Approach to capital requirements for credit risk. During the year, the Committee received regular updates on the progress made to date regarding the re- development of IFRS 9 models and the development and performance of the required IRB models. Another key project to which the Committee continues to dedicate significant focus and time is the requirement to apply a Resolvability Assessment Framework (RAF) and meet the Minimum Requirement for own funds and Eligible Liabilities (MREL) requirements. The MREL transition will commence from 1 January 2026 in a phased manner with End-state MREL applying from 1 January 2032. The Committee received frequent updates on the various work streams, challenging management and subject matter experts in progress, ensuring there was sufficient focus and adequate resourcing for the project to remain on track. In terms of non-financial risks, Consumer Duty continues to be embedded across the organisation. Management information has evolved and is frequently reviewed and challenged by the Committee. Following the FCA’s holistic review, the Consumer Duty report was given a positive green rating, with the FCA noting that the Bank’s approach was comprehensive, supported by a strong understanding of responsibilities. Actions to address development areas were agreed with completion due by July 2025. Following this feedback and the FCA’s announcement that it no longer expects firms to have a Consumer Duty Champion,the Committee discussed the necessity for this role. The conclusion was that oversight of compliance with the duty was already a key area for the Committee, with the strength of oversight by both the Committee and the Chair meaning that the role of Consumer Duty Champion was no longer deemed to be required. Operational resilience remains a key area of focus and the Committee was pleased with the progress made to close all identified vulnerabilities ahead of the final regulatory deadline of 31 March 2025, which was confirmed as part of the annual self- assessment. The Committee continues to monitor third party management as the controls and oversight mature. Cyber risk, concentration risk and the risks faced through the use of artificial intelligence (AI), continue to be reviewed to ensure that risks are being proactively considered and controls enhanced. During the financial year, responsibility for the oversight of Compliance and the Compliance Monitoring function moved from the Audit Committee to BRCC with regular updates received. Fraud risk remains heightened particularly with the rise in AI enabled fraud and the implementation of the Payment Systems Regulator’s (PSR’s) final rules on mandatory reimbursement for authorised push payment (APP) fraud. The Committee reviewed and challenged the controls and enhancements were rolled out to mitigate the risk. 84 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP BOARD RISK AND CAPITAL MANAGEMENT REPORT CONTINUED | | | | | | Role of the Committee The role of the Committee is to review, on behalf of the Board, the range of risks facing the business. The Committee performs this function by considering the risk reports presented and questions whether existing actions taken by management are appropriate. The Committee is an essential part of the Bank's governance framework. The Board has delegated the overseeing of the Bank's risk framework to ensure that it is appropriate to the size, scale and nature of the Bank's activities and able to effectively manage the material risks to which the Bank is exposed. The Committee is the most senior Risk Management Committee of the Bank. The Committee has to ensure that all risks are identified and properly mitigated and managed. The Committee also considers whether the resources allocated to the risk management functions are adequate for effectively managing the Bank's risk exposures. The Committee reports to the Board on how it discharges its responsibilities and makes appropriate recommendations to the Board. Role of the Chair The role of the Chair of the IBP BRCC requires regular meetings with the executives of the Bank, along with liaison with the Chair of the DLC BRCC. The Chair also has interactions with the risk functions, Compliance, Head of Finance and Operations and Head of IT, in order to update knowledge and remain abreast of commercial, regulatory and legislative developments, and challenges facing the business. Composition and attendance The Committee is composed solely of independent non- executive directors, with membership designed to provide the breadth of risk expertise and commercial acumen it needs to fulfil its responsibilities. The Chair of the DLC BRCC is a member of the Committee to ensure the interconnection between the Bank and its parent. | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | Meetings held in 2024/25 | | | | | | | Members | Member since | Attended | Eligible to attend 1 | | | | Paul Seward (Chair) | 1 Apr 2019 | 8 | 8 | | | | David Germain | 5 Nov 2020 | 8 | 8 | | | | Vanessa Olver | 4 Aug 2022 | 8 | 8 | | | | Brian Stevenson2 | 8 Mar 2019 | 1 | 1 | | | | Lesley Watkins | 18 Jan 2019 | 8 | 8 | | | | John Reizenstein | 1 Apr 2024 | 8 | 8 | | | | Vivek Ahuja3 | 5 Mar 2025 | 1 | 1 | | | | | | | | | 1.Where a director is unable to attend a meeting, they receive papers in advance and have the opportunity to provide comments to the Chair of the Committee. 2.Brian Stevenson stepped down from the Board and BRCC on 1 July 2025. 3.Vivek was appointed to the Board and BRCC on 5 March 2025. Looking ahead The Committee will continue to monitor overall levels of risk within the business as a result of the Bank’s accelerated growth strategy as well as macro-economic factors including the changing rate environment and market disruption and volatility. Monitoring will also cover the regulatory changes expected following the UK government’s announcement that it was focused on its growth agenda which includes cutting the cost of regulation and bureaucracy. The Committee will continue to keep regulatory developments under review, particularly in terms of the FCA’s actions relating to the motor finance commissions review following a decision from the Supreme Court. As the inflationary pressures soften and interest rates continue to reduce, the Committee will monitor the risks and potential impact on clients. The Committee will continue to review risks arising out of the Bank’s funding strategies and ensure that the Bank maintains strong levels of liquidity and capital buffers to meet regulatory and internal minimums. Progress continues to be made on embedding the Bank’s ESG and climate risk approach, and all enhancements will be overseen by the Committee. This will include monitoring the Bank’s progress against the targets set as part of the Group’s Sustainable and Transition Finance Framework. In terms of non-financial risks, fraud risk, IT, data and cyber security risk, third-party risk and operational risk will continue to be areas of focus. The Committee will remain more focused on operational resilience more broadly than the requirements under the regulations and strengthen the geographical resilience through the growth and scalability of Investec Group Services India (IGSI), and through the alignment of regulation across the Bank’s jurisdictions. In addition, the period ahead will be characterised by enhanced oversight of material regulatory projects. These will include the process of migrating from the Standardised Approach to the IRB Approach, the development of the RAF document and any actions relating to the MREL requirements. ![Paul steward sign.png]() #### Paul Seward Chair, 19 June 2025 85 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP BOARD RISK AND CAPITAL MANAGEMENT REPORT CONTINUED | | | | | | Committee Activities | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Area of focus | | Conclusions and actions | | | | Regulatory matters and projects Consideration of key risk documents, the impact of regulatory developments and projects established to implement change effectively. | | • The Committee reviewed and challenged the key risk documents, including the ILAAP, ICAAP and CFRP, ahead of final approval. • The Committee were provided with regular presentations on the Consumer Duty regulations which provided management information on the outcomes for retail clients. The Committee was assured that the client base was achieving good outcomes. Feedback received from the FCA’s holistic review was largely positive with a green rating and any feedback had proactively been addressed • The Committee received frequent updates on the IRB project. The Committee challenged the progress to date and supported the remedial actions implemented. These included increasing resourcing and utilising a third party to assist with some of the data challenges. The Committee was focused on ensuring that adequate attention was given to the project in order to be able to submit the regulatory application and migrate to IRB in a timely manner • The Committee received regular updates in terms of the operational resilience regulations, and received confirmation that the Bank had successfully closed all identified vulnerabilities in relation to remaining within impact tolerance. However, the vulnerability regarding the reliance on IBL had been left open to enhance processes and create efficiencies particularly in relation to the event of a prolonged outage • Additional work on operational resilience was undertaken cross border in addition to the important business services, including alignment to other similar frameworks where required • The Committee reviewed the third-party management framework had been enhanced throughout the year and the Committee was comfortable that there was adequate oversight • The Committee reviewed any potential and/or actual regulatory breaches and actions taken to prevent breaches from occurring. The Committee was kept abreast of any relevant regulatory guidance, fines or new regulations • The Committee reviewed the liquidity, credit and investment risk appetite, market risk appetite and counterparty credit risk appetite and non-financial risk appetite. The Committee focused on challenging the key assumptions and ensuring the limits were appropriate to enable well-managed, diversified growth as well as other risk appetites including operational risk and business risk • The Committee received updates on the FCA’s review of the historic discretionary commission arrangements in the motor finance industry. The Committee received updates from management on the changes made to ensure compliance with the Court of Appeal’s ruling and monitored other actions including the data validation work and remediation plan. The Committee was also kept informed of the level of complaints, which was relatively low, although elevated in comparison to previous years • In addition to the regular oversight of the RAF project, the Committee held an ad-hoc meeting to review the workstreams in detail and to gain assurance that there was adequate focus and that the project remained on track to meet regulatory expectations and deadlines. | | | | | | | | 86 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP BOARD RISK AND CAPITAL MANAGEMENT REPORT CONTINUED | | | | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Area of focus | | Conclusions and actions | | | | Financial risk management of the Bank Consideration of the key financial risks and the controls in place to mitigate and effectively manage the risks faced by the Bank. | | • The Committee continued to review and challenge management actions to address the risks ensuring that there was surplus liquidity and capital buffers in place to manage the possible negative impact arising from the challenging macro-economic environment • The Committee closely assessed the impact on the Bank’s ECLs, with a review of the provision, in conjunction with the Audit Committee, to ensure that it was appropriate, taking into account the macro-economic outlook and scenarios. Benchmarking by management had been conducted to assess the level of ECL and credit loss ratio against other UK banks • The Committee was comfortable that while the credit loss ratio had increased over the course of the last 18 months, the rate of new defaults had stabilised and there were no significant issues or areas of concern to raise • The Committee closely monitored the credit book given the macro-economic environment and potential for an increase in defaults and Stage 2 and Stage 3 exposures. Detailed presentations were received on the overall performance of the book as well as the top non-performing exposures and any proposed exit strategies • The Committee reviewed and challenged the progress made to reduce the investment portfolio and any risk associated to the proposed exit strategies • The Committee reviewed the work undertaken to address the findings from the PRA’s thematic review of private equity related financing activities and reviewed the aggregate direct and indirect exposures • The Committee was kept updated on the progress made to capture ESG and climate risk. The Committee reviewed the climate risk assessment that had been conducted through 2024 where credit exposures in sectors potentially exposed to climate risk were reviewed at an asset level. The purpose of the assessment was to highlight any potential exposures to physical and transition risks. The findings of this risk assessment were that exposure to climate transition and physical risk are generally low. With regard to the Sustainable and Transition Finance Framework, the Committee reviewed the target-setting process and recommended the sustainable and transition finance targets to the Board for approval. These targets were established using a bottom-up approach, based on contributions from the commercial business activities within the Bank ensuring that our sustainability objectives are aligned with our overall strategic goals • The Committee reviewed the sustainability risk appetite statement which had been updated to include Investec Bank plc’s sustainable finance target of £14.9bn by 2030 as well as the commitment to maintain zero-coal exposure in the loan book • The Committee focused on emerging risks and the mitigation thereof including both internal and external risks. | | | | | | | | 87 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | IBP BOARD RISK AND CAPITAL MANAGEMENT REPORT CONTINUED | | | | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Area of focus | | Conclusions and actions | | | | Non-financial risk management of the Bank Consideration of the key controls and processes to ensure that they were appropriate and effective to manage the material non-financial risks faced by the Bank. | | • The Committee closely monitored operational risk losses and events to gain assurance that there were no trends or issues within the control environment • The Committee examined any potential or actual fraud losses as fraud risk remained heightened throughout the industry. Overall, losses remained low and within risk appetite limits and the controls and processes were assessed to ensure they remained appropriate. A deep dive into AI-enabled fraud and the Bank’s controls included enhancements being made such as a remote biometric identity authentication system and enhanced staff training • The Committee reviewed the financial crime controls and systems used and tracked the implementation of the new transaction monitoring system as well as the work in relation to South Africa’s Financial Action Task Force’s (FATF’s) greylisting • The Committee received reports from management’s Risk and Controls Forum and the Head of Compliance, and also reviewed and approved the compliance monitoring plan • The Chair of the Committee, David Germain and DLC representative member (Vanessa Olver) attended DLC IT Risk and Governance Committee meetings to provide enhanced oversight of IT, data and cyber security risk • The Committee maintained an enhanced focus on IT, data and cyber security risk and an update on concentration risk of the technology providers and the proposed mitigation strategies as well as the strategy to migrate from physical data centres to the cloud • The Committee enhanced its oversight of projects with a focus on regulatory projects. It continued to challenge whether there were adequate resources and focus to ensure delivery and positive outcomes of the key projects undertaken • The Committee reviewed the remit and resources of the Bank’s risk management function to ensure that the function had adequate knowledge and skills with experienced individuals overseeing key risk areas. Assurance was regularly provided that there were no critical risk roles vacant and the function was adequately resourced. | | | | | | | | 88 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | DIRECTORS' REPORT | | | | | | ![Reporting_standard.png]() The directors present their directors’ report and financial statements for the year ended 31 March 2025. The Company has c hosen, in accordance with Section 414C(11) of the UK Companies Act, to include certain matters in its strategic report which are incorporated into this report by reference as follows: • An indication of likely future developments in the business of the Company and its subsidiaries (throughout our strategic report). • Our risk management objectives and policies in relation to the use of financial instruments, page 42. • A statement as to material events since 31 March 2025, page 242. • Our approach to diversity includes employment of disabled persons, page 15. More detail can be found in the Investec Group Sustainability Report which is published and available on our website www.investec.com. • Stakeholder engagement (including employees and others), page 15. • Details of charitable activities including any donations, page 15. • Statement of corporate governance arrangements, pages 61 to 87. #### Results and dividends The results for the year are shown on page 26. Movements in reserves are shown in the reconciliation of equity on page 124 of the financial statements. An interim dividend of £60 million for the period ended 30 September 2024 was paid on 9 December 2024. On 19 May 2025, the board declared that a dividend of £67 million for the period ended 31 March 2025 be paid on 12 June 2025. #### Directors The names of the persons who were directors during the financial year are set out in the table below. Biographical details of directors appointed as at the date of this report are set out on pages 63 to 65. | | | | --- | --- | | | | | | Appointed | | John Reizenstein | 2 Apr 2024 | | Brian Stevenson2 | 14 Sep 2016 | | Zarina Bassa1 | 1 Apr 2017 | | David Germain | 15 Sep 2020 | | Fani Titi | 3 Aug 2011 | | Henrietta Baldock | 10 Feb 2021 | | Vivek Ahuja | 5 Mar 2025 | | Kevin McKenna | 10 May 2012 | | Lesley Watkins | 13 Nov 2018 | | Marlé van der Walt | 20 Sep 2022 | | Paul Seward | 1 Apr 2019 | | Ruth Leas | 27 Jul 2016 | 1. Zarina Bassa stepped down from the Board on 8 August 2024. 2. Brian Stevenson stepped down as Chair of the Investec Bank plc Board and as a non-executive director on 1 July 2024 #### Corporate Sustainability Reporting #### Directive Investec Bank plc has opted to present its Sustainability Statement, as mandated by the Transparency (Directive 2004/109/EC) Regulations 2007 (as amended), in a dedicated section of this report in Section 6, which forms a fundamental part of the director’s report. This Sustainability Statement has been prepared in accordance with the European Sustainability Reporting Standards (ESRS) and in compliance with the requirements of the EU Taxonomy Regulation. #### Independent auditor and audit information Each director, at the date of approval of this report, confirms that, so far as the director is aware, there is no relevant audit information of which the Bank’s auditor is unaware and that each director has taken all steps that he or she ought to have taken as a director to make himself or herself aware of any relevant audit information and to establish that the Bank’s auditor is aware of that information. This confirmation is given pursuant to Section 418 of the Companies Act 2006 and should be interpreted in accordance with and subject to those provisions. Deloitte LLP have indicated their willingness to continue in office as auditors. A resolution proposing their re-appointment as auditors will be submitted to the annual general meeting. 89 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | DIRECTORS' REPORT CONTINUED | | | | | | #### Going concern statement In adopting the going concern basis for preparing the consolidated financial statements, the directors have considered the Bank’s business activities, objectives and strategy, principal risks and uncertainties in achieving its objectives, and performance which are set out in the strategic report. The directors have performed a robust assessment of the Bank’s financial forecasts across a range of scenarios over a 12-month period from the date the financial statements are authorised for issue. Based on the above consideration, the directors confirm that they have a reasonable expectation that the Bank has adequate resources to continue in operational existence for the 12 months from the date the financial statements are authorised for issue. The directors therefore consider it appropriate to adopt the going concern basis of accounting in preparing the accompanying consolidated financial statements. #### Viability statemen t In accordance with the UK Corporate Governance Code, which was adopted by Investec Bank plc as the corporate governance code of the Bank, in addition to providing a going concern statement (disclosed on page [89](#i100a345c65c6429e987680879833e7d3_25602)), the board is required to make a statement with respect to Investec Bank plc’s viability (i.e. its ability to continue in operation and meet its liabilities). This is required to take into account the board’s assessment of the current position of the Bank, its prospects and the principal and emerging risks it faces, including the period of time for which the board has made the assessment and why that period is considered appropriate. The board has used a three-year assessment period as this is aligned to the Investec Bank plc’s medium-term capital plans which incorporate profitability, leverage and capital adequacy projections and include impact assessments from a number of stress scenarios. Detailed management information therefore exists to provide senior management and the board sufficient and realistic visibility of Investec Bank plc’s viability over the three years to 31 March 2028. Following discussion and review by the IBP BRCC (comprising of non-executive directors, which includes certain members of the Audit Committee), the IBP Audit Committee recommended the viability statement for board approval. The board has identified the principal and emerging risks facing the Bank and these are highlighted on page 45 onwards, with further detail provided in the Investec plc (Investec Bank plc’s parent company) annual report. Through its various committees and sub committees, notably the IBP Audit Committee, the IBP BRCC and the IBP Capital Committees, the board regularly carries out a robust assessment of these principal and emerging risks and their potential impact on the performance, liquidity, solvency, capital and operational resilience of Investec Bank plc. The activities of these board sub-committees and the issues considered by them are described in the governance section of this report. Taking these risks into account, together with the Bank’s strategic objectives and the prevailing market environment, the board approved the overall mandated risk appetite and capital framework for Investec Bank plc. The risk appetite and capital frameworks set broad parameters relating to the Board’s expectations around performance, business stability and risk and capital management. The board considers that prudential risk management is paramount in all it does. Protection of depositors, customers’ interests, capital adequacy and shareholder returns are key drivers. The Bank, in keeping with sound governance practices, has defined roles and responsibilities for the management of risk in accordance with the three lines of defence model, i.e. business line management, an independent risk function and an independent internal audit function. In addition, to manage the Bank’s risk appetite, there are a number of detailed statements, frameworks, policies and governance structures in place. The Board ensures that there are appropriate resources in place to manage the risks arising from running the business by having independent Risk Management, Compliance, and Financial Control functions. These are supplemented by an Internal Audit function that reports independently to the non-executive IBP Audit Committee Chair. The board believes that the risk management systems and processes, supported by the conclusions of the Internal Audit function and the results of combined assurance coverage through each assurance function, are adequate to support Investec Bank plc’s strategy and allow the Bank to operate within its risk appetite and capital frameworks. A review of Investec Bank plc’s performance/measurement against its risk appetite framework is provided at each IBP BRCC meeting and at the main board meetings. In terms of the FCA and PRA requirements, Investec Bank plc is also required to meet regulatory standards with respect to capital and liquidity. In terms of these requirements, Investec Bank plc is required to stress its capital and liquidity positions under a number of severe stress conditions. IBP’s stress testing framework is well embedded in its operations and is designed to identify and regularly test the Bank’s key ‘vulnerabilities under stress’. 90 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | DIRECTORS' REPORT CONTINUED | | | | | | In order to manage liquidity risk, liquidity stress testing is performed for a range of scenarios, each representing a different set of assumptions. These include market-wide, firm specific, and combined scenarios (combination of the market- wide and firm specific stresses). Investec Bank plc manages its liquidity risk appetite in relation to combined stress parameters which represent extreme but plausible circumstances. The objective is to have sufficient liquidity under a combined stress scenario to continue to operate for a minimum period as detailed in the board-approved risk appetite framework. In addition to these stress scenarios, the Bank’s risk appetite also requires it to maintain specified minimum levels for both the liquidity coverage ratio and net stable funding ratio and regulatory minimums of 100% respectively; a minimum cash and near cash to customer deposit ratio of 25%; and to maintain low reliance on wholesale funding to fund core asset growth. Investec plc undertakes an annual Internal Liquidity Adequacy Assessment Process (ILAAP) which documents the approach to liquidity management across the firm. This document is reviewed and approved by IBP Board Risk and Capital Committee (IBP BRCC), DLC BRCC and by the IBP, plc and DLC Boards. Each legal banking entity within Investec Bank plc is required to be fully self-funded. The Bank currently has £9.1 billion in cash and near cash assets as at 31 March 2025, representing 42.2% of customer deposits. Investec Bank plc develops annual capital plans (refreshed after six months) that look forward over a three-year period. The capital plans are refreshed on an ad hoc basis if a material event occurs or is likely to occur. These plans are designed to assess the capital adequacy of Investec Bank plc and its subsidiaries under a range of economic and internal conditions, with the impact on earnings, asset growth, risk appetite and liquidity considered. The output of capital planning allows senior management and the board to make decisions to ensure that Investec Bank plc continues to hold sufficient capital to meet internal and regulatory capital targets over the medium term (i.e. three years). Investec Bank plc targets a CET1 ratio in excess of 10%, a tier 1 ratio greater than 11%, a minimum capital adequacy ratio of 14% to 17%, and a leverage ratio in excess of 6%. The parameters used in the liquidity and capital stresses are reviewed regularly, taking into account the principal and emerging risks facing the Bank, changes in the business environments and inputs from business units. Scenarios are designed considering macro-economic downside risks, portfolio-specific risk factors and business model vulnerabilities. Multiple scenarios are considered to account for the uncertain forward-looking macro-economic environment. • Base Case: A reacceleration of UK GDP is expected following the stagnation seen over H2 2024 calendar year. Solid real household disposable income growth, alongside a pickup in investment, are seen as driving factors. A more favourable interest rate environment is supportive to growth too. This is due to the baseline assumption that CPI inflation returns to the 2% target over time, thus allowing for further interest rate reductions: the Bank rate is expected to fall to 3.75% by the end of 2025 and to 3.00% in the medium term. Globally, monetary policy is also assumed to return to more neutral levels following several years in restrictive territory, enabled by continued disinflationary trends and inflation targets being met. Meanwhile global growth is expected to continue at a modest pace in the near term. In assessing stress scenarios for the 2025 capital planning exercise, two different scenarios were considered. The first scenario entails an escalated trade war resulting in renewed inflationary pressures and higher interest rates, and the second scenario considers a global economic demand shock resulting in severe recessions and aggressive central bank monetary policy easing. These are defined below: • Trade war: This scenario is characterized by aggressive US trade policy, including a universal 20% tariff and a 100% levy on Chinese imports prompts retaliation from major trading partners and the onset of a global trade war. Tariffs themselves, and supply chain disruptions, result in a resurgence in inflation. In the UK, CPI inflation reaches a peak of 4.7%. In response to the rise in inflation, and concerns over inflation expectations becoming dis-anchored, the Bank of England resumes monetary policy tightening, with the Bank rate reaching a peak of 5.50% in Q4 ‘25 and remaining there until Q3 ’26. The economy enters a protracted and deep recession with GDP contracting by 3%. Financial markets witness a significant degree of turbulence, the FTSE 100 falls 35%, and sterling corporate bond spreads more than double (investment grade, 340bps). Meanwhile tighter financial conditions, higher interest rates and the poor macro backdrop prompt significant falls in real estate values: UK residential house prices fall 26%, commercial -23%. The economy begins to recover in 2027, helped by falling interest rates, although in the medium-term potential growth is lower than before the economic shock. More broadly there is a global recession with world GDP contracting 2.6%, and economies such as the Euro area seeing a more severe downturn (-3.4%), whilst the US experiences a 4% fall in GDP. • Global synchronised downturn: This stress scenario represents a hypothetical synchronised demand shock designed to encapsulate unforeseen tail risks. This envisages a global recession over FY 2025/26, with world GDP contracting by 3%. At the country level, US and Chinese output fall by 4.2% and 1.2% respectively. Unemployment rises, whilst inflation falls, prompting central banks globally to ease monetary policy expediently. Domestically UK GDP falls 4.1% peak to trough in year 1 of the scenario. Meanwhile, with disinflationary pressures causing CPI inflation to fall to a low of 0.8%, the Bank of England is assumed to respond aggressively to the economic downturn by easing policy. The Bank rate is therefore assumed to fall by 350bps between Q1 ’25 and Q3 ’26, reaching a low of 0.75%, whilst Quantitative Easing (QE) is also resumed. A recovery is envisaged in the medium term, accompanied by a sustainable return of inflation to the 2% target, and as such the Bank rate rises to a level judged to be neutral (3.00%). 91 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | DIRECTORS' REPORT CONTINUED | | | | | | Investec Bank plc implements regulatory scenarios (UK BoE Bank Capital Stress Scenario) when they are published by the regulator. For 2025 the BoE published its new Bank Capital Stress Test (BCST) as at 31 March 2025. This new regulatory scenario has been incorporated into the Investec PLC stress testing programme. The summary of this scenario is below: • The 2025 Bank of England Bank Capital Stress Test (BCST) represents a severe global supply shock driven by an escalation in geopolitical tensions and a consequent commodity price shock. The shock is further compounded by a fragmentation of global trade relationships caused by import tariffs and supply chain disruptions. The main features domestically are a significant rise in inflation: CPI inflation reaches a peak of 10% in Q1 2026, which causes the Bank rate to rise to a peak of 8% by Q1 2026. The Bank rate is subsequently then cut, helping to support a recovery following the 5% contraction in GDP over the first five quarters of the scenario. The severity of the economic downturn, coupled with high unemployment and high interest rates, sees house prices fall by 28%. The picture is mirrored globally with both the US and Euro area experiencing 4% falls in GDP. Meanwhile the financial market stress is as severe as that seen during the 2008/09 global financial crisis. The board has assessed the Bank’s viability in its ‘base case’ and stress scenarios. In assessing Investec Bank plc’s viability, a number of assumptions are built into its liquidity and capital plans. In the stress scenarios these include, for example, foregoing or reducing dividend payments and asset growth being curtailed. We also carry out ‘reverse stress tests’, i.e., scenarios that cause the business model to fail. Reverse stress scenarios are developed thematically, and their impact is assessed in qualitative and quantitative terms with respect to liquidity threshold conditions and regulatory capital, taking into account the loss absorbing effects of the bank’s capital stack. Escalating losses may expose the business model to unacceptable levels of risk well before regulatory threshold conditions are breached, and mitigating actions are identified with the aim to prevent the failure of IBP. Reverse scenarios are extreme tail events and are considered remote, and mainly serve the purpose of identifying and addressing potential weaknesses that may not be identified through the ongoing risk and capital management and stress testing processes. In addition, the Bank performs climate scenario analysis and risk assessments in line with the requirements stipulated by Supervisory Statement SS3/19 ‘Enhancing banks’ and insurers’ approaches to managing the financial risks from climate change’, on a proportionate basis for the size and complexity of the Bank. To date, findings indicate that transition and physical risk is low and Investec Bank plc has sufficient liquidity and capital to continue as a going concern and meet regulatory liquidity and capital requirements. Investec Bank plc’s parent company, Investec plc, is required to maintain a contingency funding and recovery plan, and a resolution pack for the Investec plc consolidated Group. The recovery plan documents how the Board and senior management will ensure that the Investec plc Group recovers from extreme financial stress to avoid liquidity and capital difficulties. The key focus in the recovery plan is the Bank and the protection of its depositors and other clients. On 28 June 2023, the BoE formally notified Investec plc that the preferred resolution strategy will be changed from bank insolvency procedure to bail-in and as such a revised, increased minimum requirement for own funds and eligible liabilities (MREL) requirements will be imposed on Investec plc and IBP as a material subsidiary. The MREL transition will commence from 1 January 2026 with end state MREL applying from 1 January 2032. As a bail-in firm, Investec plc will come into scope of the BoE’s Resolvability Assessment Framework and is committed to ensuring its resolution capabilities meet the required regulatory standards. Investec Bank plc also maintains an operational resilience framework that defines important business services, impact tolerances and plans to respond effectively to a disruption. This not only ensures continuity of business operations but also safeguards the interests of key stakeholders including clients and regulators, as well as maintaining our reputation, brand and value‐creating activities. The capital and liquidity plans, stress scenarios, contingency funding and recovery plans, the resolution pack and the risk appetite statements are reviewed at least annually by the respective Capital, Risk, and board committees. In times of severe economic distress and if applicable, stress scenarios are reviewed more regularly; for example, as was the case with the COVID‐19 pandemic. In addition, senior management hosts an annual risk appetite process at which the Bank’s risk appetite frameworks are reviewed and modified to take into account risk experience and changes in the environment. Furthermore, strategic budget processes take place within each business division at least annually. These focus on, amongst other things: the business and competitive landscape; opportunities and challenges including the use of new and emerging technologies and operational risks relating to technology, resilience and cyber security; and financial projections. A summary of these divisional budgets is presented to the board during its strategic review process early in the year. 92 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | DIRECTORS' REPORT CONTINUED | | | | | | In assessing the Bank’s viability, the board has taken all of the above-mentioned factors, documents and processes into consideration. The directors can confirm that they have a reasonable expectation that Investec Bank plc will continue to operate and meet its liabilities as they fall due over the next three years. The viability statement should be read in conjunction with the following sections in the annual reports, all of which have informed the Board’s assessment of Investec Bank plc’s viability: • Pages [4](#i447e4d363cd344738300acdd42f0e3a0_3762) to [39](#i447e4d363cd344738300acdd42f0e3a0_136), which show a strategic and financial overview of the business • Page [45](#i447e4d363cd344738300acdd42f0e3a0_181) to [60](#i0609d661f46a43d6bd32d13259b11cc1_4772) which provides detail on the principal and emerging risks the Bank faces and the processes in place to assist Investec Bank plc in mitigating its principal risks • Page [42](#i447e4d363cd344738300acdd42f0e3a0_175) which provide an overview of Investec Bank plc’s approach to risk management • Pages [45](#i447e4d363cd344738300acdd42f0e3a0_181), [248](#i447e4d363cd344738300acdd42f0e3a0_484),[274](#i3ae88ff87b114067899834f8d77fee9e_9769) and [288](#i7c92788fb1474a82a8a57477341a81fa_37323) which highlight information on Investec Bank plc’s various stress testing processes • Page [278](#icd4ee75502c2463ea93e90de1b2ebc08_32319) to [283](#icd4ee75502c2463ea93e90de1b2ebc08_8900) which focuses on Investec Bank plc’s philosophy and approach to liquidity management • Page [286](#ib2fe0d6b03b544f19e301b71680849d9_0-1-1-1-2494133) which provides detail on the recovery and resolution pack • Pages [287](#i7c92788fb1474a82a8a57477341a81fa_14287) to [291](#i7c92788fb1474a82a8a57477341a81fa_14283) which explain Investec Bank plc’s capital management framework. This forward‐looking viability statement made by the board is based on information and knowledge of Investec Bank plc at 19 June 2025. There could be a number of risks and uncertainties arising from (but not limited to) domestic and global economic and business conditions, including the development of new technologies, beyond IBP’s control that could cause Investec Bank plc’s actual results, performance or achievements in the markets in which it operates to differ from those anticipated. #### Events after the reporting date | | | | --- | --- | | | | | | Refer to Note 56 of the Annual Financial statements. | #### Directors’ responsibility statement The following statement, which should be read in conjunction with the auditor’s report set out on pages 108 to 118, distinguishes for its shareholder the respective responsibilities of the directors and of the auditors in relation to the accounts. The directors are responsible for preparing the annual report and the Bank’s financial statements in accordance with applicable United Kingdom law and regulations. Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with International Financial Reporting Standards (IFRSs) in conformity with the Companies Act 2006. Under company law, the directors must not approve the Group financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company and of the profit or loss of the Group and the Company for that period. In preparing these financial statements the directors are required to: • Select suitable accounting policies in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors and then apply them consistently • Make judgements and accounting estimates that are reasonable and prudent • Present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information • Provide additional disclosures when compliance with the specific requirements in IFRSs is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the Bank’s financial position and financial performance • In respect of the Bank financial statements, state whether IFRSs in conformity with the Companies Act 2006 and IFRSs adopted pursuant to Regulation(EC) No. 1606/2002 as it applies in the European Union have been followed, subject to any material departures disclosed and explained in the financial statements • In respect of the parent company’s financial statements, state whether IFRS is in conformity with the Companies Act 2006, have been followed, subject to any material departures disclosed and explained in the financial statements • Prepare the financial statements on the going concern basis unless it is appropriate to presume that the Bank will not continue in business. 93 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 03 | | Risk management and governance | CORPORATE GOVERNANCE | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | DIRECTORS' REPORT CONTINUED | | | | | | The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Bank’s transactions and disclose with reasonable accuracy at any time the financial position of the Bank and enable them to ensure that the Bank’s financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Bank and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Under applicable law and regulations, the directors are also responsible for preparing a strategic report, directors’ report, directors’ remuneration report and corporate governance statement that comply with that law and those regulations. The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. The directors confirm, to the best of their knowledge: • That the consolidated financial statements, prepared in accordance with IFRSs in conformity with the Companies Act 2006 and IFRSs adopted pursuant to Regulation(EC) No.1606/2002 as it applies in the European Union, give a true and fair view of the assets, liabilities, financial position and profit of the parent company and undertakings included in the consolidation taken as a whole • That the annual report, including the strategic report (being section 1 and 2 of the annual report), includes a fair review of the development and performance of the business and the position of the Bank, together with a description of the principal risks and uncertainties that they face • That they consider the annual report, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Bank’s position, performance, business model and strategy. The strategic report, directors’ report and the financial statements of the Bank, were approved by the board of directors on 19 June 2025 Signed on behalf of the board | | | | --- | --- | | | | | | | | Ruth Leas Chief Executive 19 June 2025 | John Reizenstein Chair 19 June 2025 | 94 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | 04 | | | ## Remuneration ## report IN THIS SECTION | | | | --- | --- | | | | | [96](#i447e4d363cd344738300acdd42f0e3a0_250) | Remuneration report | | | | 95 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | | | | 96 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | REMUNERATION REPORT | | | | | | | | | | | --- | --- | --- | | | | | | | | | | | | Henrietta Baldock Chair of the IBP Remuneration Committee | | | | | | It has been another strong year for the Bank in a volatile environment and we remain confident in the performance and strength of the business and dedication of our people. | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Henrietta Baldock 19 June 2025 | | | | | | | | Meetings held in 2024/25 | | | | | | | | | | Member since | Eligible to attend | Attended | | | | Henrietta Baldock (Chair) | | 5 August 2021 | 7 | 7 | | | | Brian Stevenson1 | | 20 May 2019 | 3 | 3 | | | | Lesley Watkins | | 20 May 2019 | 7 | 7 | | | | John Reizenstein2 | | 2 April 2024 | 7 | 7 | | | | Vivek Ahuja3 | | 5 March 2025 | — | — | | | | 1.      Brian Stevenson stepped down as an Investec Bank plc (IBP) committee member from 1 July 2024 2.     John Reizenstein joined as an IBP committee member on 2 April 2024 3.     Vivek Ahuja was appointed as notified NED of IBP on 5 March 2025, however there were no further meetings held after his appointment in the year to 31 March 2025 | | | | | | | | | | | | | | | | Key achievements in FY2025 | | | | | | | | • Considered and approved the proposed 2025 remuneration approach for executive directors, senior management, Material Risk Takers (MRTs), control function employees and other employees • Approved the variable remuneration spend and overall remuneration approach for the financial year ended 31 March 2025 • Reviewed and approved the objectives for each executive director • Reviewed the diversity implications of the remuneration philosophy, policy and structures, including the diversity pay gap figures • Considered the interaction between culture and reward and the potential implications thereof | | • Reviewed the non-standard remuneration structures within Investec Bank plc • Regularly considered external legislative and regulatory developments, including the November 2024 PRA & FCA Remuneration Reform consultation exercise, to which a response was submitted • Regularly considered the application of malus and/or clawback • Reviewed key new hires and exits, including the remuneration outcomes for leavers | | | | | | | | | | | | | | Areas of focus in FY2026 | | | | | | | | • Consider and approve the remuneration framework and objectives for the Chief Executive, in the context of the Group Executive Team framework • Consider and approve the remuneration framework and objectives for the IBP Executive Committee • Consider the belonging, inclusion and diversity implications of the remuneration philosophy, policy and frameworks including equal pay and the diversity pay gaps • Consider how our remuneration philosophy, policy, practices and approach support and align with our Sustainability initiatives, Group strategy and culture | | • Continue to regularly consider the application of malus and/or clawback • Consider the alignment of remuneration policies and practices for all employees with the Chief Executive and executive team • Consider the risk implications of our remuneration policies and frameworks • Review regulatory changes relating to remuneration including the final outcome of the 2024 PRA & FCA Remuneration Reform consultation exercise | | | | | | | | | | | | 97 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | REMUNERATION REPORT CONTINUED | | | | | | #### Introduction It is my pleasure to present the remuneration report for the year ended 31 March 2025, which describes the approach to remuneration at the Bank. The IBP Remuneration Committee has responsibility for remuneration within the Bank and ensures compliance with applicable legislation and governance requirements of the jurisdictions within which the Bank operates, including its obligations as an independent bank regulated by the UK Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA). While the IBP Remuneration Committee is responsible for remuneration within the Bank, it reports key items up to both the IBP Board and the DLC Remuneration Committee. Before we turn to look in more detail at key aspects of our remuneration, I would like to reflect on the IBP Remuneration Committee’s responsibilities, achievements and challenges encountered over the past year, and to consider the key areas of focus for the IBP Remuneration Committee in the year ahead. Role of the Chair The role of the Chair of the IBP Remuneration Committee requires regular meetings with the Executives of the Bank. The Chair also has interactions with internal and external specialist advisers and with the Heads of Reward, People & Organisation, Compliance and Risk, in order to keep knowledge up to date, and to keep abreast of commercial, regulatory and legislative developments and challenges facing the business. These interactions are an essential part of the role of the Chair of the IBP Remuneration Committee. Composition I served as Chair of the IBP Remuneration Committee and the other members of the Committee were Brian Stevenson, Lesley Watkins and John Reizenstein. Lesley and I served for the full year, John joined the committee on 2 April 2024 and Brian stepped down on 1 July 2024. Vivek Ahuja was appointed as notified NED of IBP on 5 March 2025, however there were no further meetings held after his appointment in the year to 31 March 2025. The IBP Remuneration Committee is composed of independent non- executive directors, with membership designed to provide the breadth of experience necessary for the members to consider the issues that are presented to the IBP Remuneration Committee. I also served as Chair of the DLC Remuneration Committee for the full year. This has enhanced the interconnection between the IBP Remuneration Committee and the DLC Remuneration Committee. Committee responsibilities The IBP Remuneration Committee is responsible for considering the remuneration arrangements of the executive directors, senior employees including Material Risk Takers (MRTs), and that of the wider workforce of the Bank. The remuneration framework, performance measures and metrics for the IBP Chief Executive Ruth Leas, who is a Person Discharging Managerial Responsibilities (PDMR) of the Investec Group, are determined by the DLC Remuneration Committee following consultation with the IBP Remuneration Committee. The annual remuneration for the Chief Executive is then reviewed by the IBP Remuneration Committee, with a recommendation provided to the DLC Remuneration Committee. The IBP Remuneration Committee receives reports from the IBP Reward Committee, which has been mandated to oversee the reward framework for Investec Bank plc employees, and act as the Malus and Clawback Committee to apply the Bank’s policy in this regard. The membership of the Remuneration Committee comprised independent non-executive directors. Any matters relevant to the Bank were communicated to the Bank, in part, through having the Chair of the DLC Remuneration Committee, myself, as the Chair of the IBP Remuneration Committee. The IBP Remuneration Committee reviews and recommends the remuneration for the executive directors and senior employees of the Bank to the DLC Remuneration Committee. The policy on remuneration packages for non-executive directors is agreed and determined by the Investec Group Board. The past year in focus The past year was another challenging year for the IBP Remuneration Committee, requiring a strong focus on appropriate remuneration despite the volatile operating environment. The Committee ensured they focused on balancing the interests of various stakeholders in considering the approach to remuneration, in particular variable remuneration payouts. As outlined in the corporate governance section, the Board and the IBP Remuneration Committee have a strong focus on culture. It has been frequently documented, including by our regulators, that remuneration structures and practices can and do have a significant impact on the culture within organisations. Therefore this potential effect has a significant bearing on the approach and deliberations of the IBP Remuneration Committee when reviewing remuneration processes and practices within the Bank. David Germain is the designated Non-Executive Director for workforce engagement for the Bank. Activities during the year have included culture dialogues, diversity and inclusion programmes, talent programmes, town halls, and question and answer sessions. A quarterly workforce engagement synthesis meeting is also held with David as the designated Non-Executive Director for workforce engagement for the Board of Investec Bank Plc to ensure that the matters of interest to our people are considered across the Group. The IBP Remuneration Committee also oversaw the details and publication of the Bank’s annual pay gap report, which includes the ethnicity pay gap. | | | | --- | --- | | | | | | Refer to the pay gap report published on the Investec website for full details . | The IBP Remuneration Committee is committed to ensuring further improvement in the future. In addition, the Bank is a signatory to the Women in Finance Charter, and in doing so has committed to, among other items, linking the pay of senior executives to delivery against the set targets. We exceeded our 2022 Charter Targets and have targets set for 2027, full details are disclosed on our website. Throughout the year, the IBP Remuneration Committee reviewed the proposed approach to variable remuneration for the financial year ending 31 March 2025 and agreed the final approach in May 2025. 98 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | REMUNERATION REPORT CONTINUED | | | | | | We are confident that the approach taken has enabled us to invest in appropriate strategic initiatives, reward those who performed strongly, retain our key people and further strengthen the alignment with the Bank, the Group and our shareholder. Performance and outcomes for the year The Bank delivered a strong set of results in volatile markets. The Specialist Banking client franchises performed strongly, showing continued traction in our growth strategies across the business. There was strong revenue growth across our key client franchises as we continued to successfully execute our client acquisition strategies to build scale and relevance in the UK and other markets in which we operate. Variable remuneration for the 2025 year was calculated using the standard Economic Value Added (EVA) calculation. Investec Bank plc reported an adjusted operating profit of £496.8 million for the year, our people have delivered a strong performance and have been rewarded accordingly. We considered the needs of all of our stakeholders, including our shareholder, when determining the remuneration spend for the year. We agreed the following principles to guide our approach: • Ensure we are rewarding for performance • Protect our business (so we have a sustainable, viable business in the long term) • Ensure we retain those individuals who are deemed key to the future strategy of the business • Mitigate flight risk and potential impact to the franchise • Account for external factors, including the views of our shareholder and regulators • Ensure we are sensitive to and supportive of the communities in which we operate. Looking ahead It has been another positive year for the business and we remain confident in the performance and strength of our business, the dedication of our people and the optimised scale, resilience and technology within the business. The IBP Remuneration Committee will continue to focus in the coming year on our remuneration practices, with particular attention being given to ensuring that our philosophy, policy and approach support and align with our culture, and our approach to belonging, inclusion and diversity. With effect from October 2023 the UK PRA and FCA provided flexibility to permit firms, including Investec, to set maximum ratios between variable and fixed pay for MRTs as they consider to be appropriate, no longer limited to a ratio of 2:1. The variable to fixed pay maximum ratio(s) for UK MRTs will be set by the IBP Remuneration Committee from time to time taking into account market practice, applicable rules and guidance from the UK PRA and FCA, enabling Investec to reduce fixed pay costs over time and increase the amount of pay subject to performance. The MRT variable to fixed pay maximum ratio for the 2024/25 year was 5:1. MRTs of Investec’s EU entities or branches will remain subject to the ratio of 2:1 for as long as the relevant EU regulations continue to be in place. The IBP Remuneration Committee believes that the Bank’s approach to executive remuneration is designed to incentivise exceptional performance from its Executives and employees, and ensure they are rewarded appropriately for performance. The Bank is also focused on ensuring that its approach to reward is fair in all aspects, and that all stakeholders are taken into account when determining how executives and employees are rewarded. The IBP Remuneration Committee considers that there is strong alignment between the Bank’s remuneration structure and the Bank’s stakeholders, especially with vesting periods of share awards granted to employees which generally vest over five years, and in some cases seven years, with additional post- vesting retention periods for MRTs. Conclusion The IBP Remuneration Committee has had another positive year. We are confident that the steps we have taken have allowed us to effectively reward our people who have performed strongly, retain our key people, and ensure strong alignment with the Bank, the Group and our shareholder. ![Henrietta e-sig.png]() Henrietta Baldock Chair, IBP Remuneration Committee 19 June 2025 99 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | REMUNERATION REPORT CONTINUED | | | | | | #### Remuneration overview | | | --- | | | | Inside this section | | | | Remuneration philosophy and approach for all employees | | Remuneration policy | | Variable remuneration | | Other remuneration structures | | Governance | | Key Management Personnel | #### Remuneration philosophy and approach #### for all employees Our remuneration approach is designed to foster an exceptional performance culture that enables an entrepreneurial spirit as well as a strong sense of ownership. We use remuneration to help attract and retain culturally aligned, smart, innovative and talented people who adhere and subscribe to our culture, risk appetite, values and philosophies, and to recognise and drive out of the ordinary performance. The Bank’s remuneration levers work to: • Provide a sense of security, so people feel free to innovate, challenge and influence • Motivate people to deliver exceptional performance • Give people a sense of ownership, so they feel invested in the organisation. Our remuneration approach reflects our culture; it is an honest and challenging process that is tailored to individual roles and acknowledges personal and team contributions. We reward people for the contribution they make through payment of a fixed package, variable performance bonus, and ownership through a share incentive scheme. We strive to provide a working environment that stimulates extraordinary performance so that executive directors and employees may be positive contributors to our clients, our communities and the Group. When determining levels of variable remuneration, the Bank considers the overall level of performance, culture and risk events in the year. The proportion of variable to fixed remuneration is carefully monitored to ensure compliance with regulatory requirements. All incentives are subject to the Bank’s performance adjustment policy. This provides the Bank with the ability to reduce, revoke or recover variable remuneration in respect of a risk, control or conduct issue, event or behaviour. Given IBP executive directors’ and additional senior Bank executive incentives are deferred for up to seven years, the Bank does not believe that the incentive structures inadvertently motivate irresponsible or short-term behaviour. 100 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | REMUNERATION REPORT CONTINUED | | | | | | OVERVIEW OF REMUNERATION FOR ALL EMPLOYEES | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Element | | Operation – Bank | | | | | | | | | | Salary | | • Paid monthly in cash | | | | | | | | | | | | | | | | Role-based Allowance | | • Role-based Allowances may be awarded to certain MRTs to reflect their roles and ensure an appropriate balance between fixed and variable remuneration – Paid monthly in cash – These are fixed, according to the nature of each role, and can only be amended in certain limited circumstances (e.g. a material increase in organisational responsibilities) | | | | | | | | | | | | | | | | Benefits and pension | | • Benefits are provided, with the details depending on local market practice – Employees have access to country-specific, Company-funded benefits such as pension schemes, private medical insurance, permanent health insurance, life insurance and cash allowances – Pension and benefit levels differ globally to be competitive in different markets, and there is no single pension level across the Group – Bank executive directors have access to the same benefits as Bank employees mentioned above, being Company-funded benefits such as pension schemes, private medical insurance, permanent health insurance and life insurance | | | | | | | | | | | | | | | | Short-term incentive | | • Discretionary performance bonuses based on business and individual performance • The amounts available to be distributed are based on the Bank-wide risk adjusted Economic Value Added (EVA) model which is, at a high level, based on revenue less risk-adjusted costs, and overall affordability • At an individual level the bonus allocations are determined based on performance against qualitative and quantitative factors. Qualitative measures include adherence to culture, including supporting belonging, inclusion and diversity, client outcomes, market context, contribution to performance and brand building, attitude displayed towards risk consciousness and effective risk management | | | | | | | | | | | | Non-Material Risk Takers: • For employees who are not MRTs, all bonus awards exceeding a pre-determined threshold are subject to 60% deferral in respect of the portion exceeding the threshold • The deferred amount is awarded in the form of: short-term share awards vesting in three equal tranches over a period of approximately three years; or cash released in three equal tranches over a period of approximately three years • Deferred bonuses are subject to malus conditions | | | | | | | | | | | | Material Risk Takers: Bonus awards are subject to deferral as follows: • Where variable remuneration, comprising bonus and long-term incentives, equals or exceeds £500 000, 60% of variable remuneration is deferred • Where variable remuneration is less than £500 000 40% is deferred, unless the de-minimis concession is met in which case there is no deferral • A minimum of 50% of both the deferred and non-deferred elements are delivered in shares, with the remaining balance in cash or shares • The deferred elements vest over periods from four up to seven years and are subject to an appropriate retention period, generally 12 months, after vesting • All variable remuneration is subject to clawback • All deferred variable remuneration is subject to malus • MRTs were subject to the 5:1 maximum ratio of variable to fixed remuneration for the 2024/25 year | | | | | | | | | | | | | | | | Other | | • Where employees in the audit, risk and compliance functions support a specific area of the business, their variable remuneration is set independently of the business area that they oversee • The non-executive directors are not eligible to participate in any of the Group’s incentive plans or to join any pension scheme. They do not receive any taxable benefits over and above reimbursement for agreed travel and subsistence | | | | | | | | 101 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | REMUNERATION REPORT CONTINUED | | | | | | Consideration of all employee remuneration The IBP Remuneration Committee reviews changes in remuneration arrangements in the workforce as we recognise that all our people play an important role in the success of the Bank. The Bank is committed to creating an inclusive working environment and to rewarding our employees throughout the organisation in a fair manner, and the IBP Remuneration Committee reviews our practices around creating a fair, diverse and inclusive working environment. In making decisions on executive pay, the IBP Remuneration Committee considers wider workforce remuneration and conditions to ensure that they are aligned on an ongoing basis. Effective from 2019 the Board appointed a designated non- executive director to represent employees in the boardroom. The Board believes that employees throughout the Bank should be able to share in the success of the Bank. As such, as outlined in the table on the prior page, in addition to the fixed pay element, all of our employees have access to market relevant benefits, and all employees are eligible to be considered for an annual bonus after a short initial qualifying period. The Board believes strongly in share ownership among our employees and therefore all employees are, in principle eligible for, and many participate in our long-term incentive scheme. #### Remuneration policy All remuneration payable (salary, benefits and incentives) is assessed at a Bank, business unit and individual level. This framework seeks to balance both financial and non-financial measures of performance to ensure that the appropriate factors are considered prior to making awards, and that the appropriate mix of cash and share-based awards are made. Determination of remuneration levels for employees Qualitative and quantitative considerations form an integral part of the determination of overall levels of remuneration and total compensation for each individual. Factors considered for overall levels of remuneration in the Bank include: • Financial measures of performance – Risk-adjusted EVA model – Affordability • Non-financial measures of performance – Market context – Specific input from the risk and compliance functions. Factors considered to determine total compensation for each individual include: • Financial measures of performance – Achievement of individual targets and objectives – Scope of responsibility and individual contributions • Non-financial measures of performance – Alignment and adherence to our culture and values, including supporting belonging, inclusion and diversity – The level of cooperation and collaboration fostered – Development of self and others – Attitude displayed towards risk consciousness and effective risk management – Adherence to internal control procedures – Compliance with the Bank’s regulatory requirements and relevant policies and procedures, including treating customers fairly – The ability to grow and develop markets and client relationships – Multi-year contribution to performance and brand building – Long-term sustained performance – Specific input from the risk and compliance functions – Attitude and contribution to sustainability principles and initiatives. Remuneration levels are targeted to be commercially competitive on the following basis: • The most relevant competitive reference points for remuneration levels are based on the scope of responsibility and individual contributions made • The IBP Remuneration Committee recognises that the Bank operates an international business and competes with both local and international competitors in each of our markets • Appropriate benchmarks of industry and comparable organisations’ remuneration practices are reviewed regularly • While benchmarking information is utilised, it is considered along with other relevant factors, including internal comparators, the scope and complexity of the role and the individual’s contribution. #### Variable remuneration All employees are eligible to be considered for a discretionary annual bonus, subject inter alia to the factors set out above in the section dealing with the determination of remuneration levels. The structure of short-term incentives reflects differing regulatory requirements for the different legal entities and also differing competitive pressures in each distinct market in which the Bank operates. Bank: variable short-term incentive Risk weighted returns form the basis for variable remuneration levels in addition to other financial, non- financial and risk factors that are considered | | | | --- | --- | | | | | | In our ordinary course of business, we face a number of risks that could affect our business operations, as highlighted on page 45. | Risk management is independent from the business units and monitors, manages and reports on the Bank’s risk to ensure it is within the stated risk appetite, as mandated by the Board of Directors through the IBP Board Risk and Capital Committee (IBP BRCC). The Bank monitors and controls risk exposure through credit, market, capital, liquidity, operational and legal risk divisions/forums/committees. The Bank’s central credit, investment and risk forums, IBP Executive Risk Review Forum (Review ERRF) and IBP Executive Risk Committee (IBP ERC) provide transaction approval independent of the business unit on a deal-by-deal basis. 102 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | REMUNERATION REPORT CONTINUED | | | | | | EVA model: allocation of performance-related bonus pool Our business strategy and associated risk appetite, together with effective capital utilisation, underpin the EVA annual bonus allocation model. Business units share in the annual bonus pool to the extent that they have generated a realised return on their allocated risk- adjusted capital base in excess of their target return on equity. Many of the potential future risks that the firm may face are avoided through ensuring that the bonus pools are based on actual realised risk-adjusted profits. The bonus pools for non-operating business units (Business Enablement) are generated by a levy payable by each business unit on its operating profit. This bonus pool may, in some years, be supplemented by a discretionary allocation as determined by the executive, and agreed by the IBP Remuneration Committee. In terms of our EVA process, if business and individual performance goals are exceeded, the variable element of the total remuneration package is likely to be substantially higher than the relevant target benchmark. This ensures that overall remuneration levels have the potential to be positioned at the upper quartile level for superior performance, in line with our overarching remuneration policy. In circumstances where a business unit does not have an EVA pool (e.g. when it incurs a loss or when it is a start-up), the executive and IBP Remuneration Committee, with support from the Group and the DLC Remuneration Committee, may consider a discretionary allocation to allow for a bonus for those staff who were expected to contribute to the longer-term interests of that business unit or the Bank, despite the lack of EVA profits in the short term, e.g. control functions, support staff and key business staff. Where employees in the audit, risk and compliance functions support a specific area of the business, their variable remuneration is set independently of the business area that they oversee. The level of rewards for these employees are assessed against the overall financial performance of the Bank; objectives based on their function; and compliance with the various non-financial aspects referred to above. Key elements of the bonus allocation process are set out below: • A fixed predetermined percentage of any return in excess of the EVA hurdle accrues to the business units’ EVA pool • A portion of the total EVA pool is allocated towards the bonus pool for Business Enablement • These bonus pools are reviewed regularly by the appropriate management and non-executive committees to ensure that awards are only paid when it is appropriate to do so, considering the Group-wide performance against non- financial risk (both current and future) and compliance-based objectives and in order to ensure that the payment of such discretionary bonuses does not inhibit the Bank’s ability to maintain or raise its capital levels. All users of capital operate within a strict philosophical framework that requires a balancing of risk and reward and that is designed to encourage behaviour in the interests of all stakeholders as opposed to just employees • The EVA pools are calculated centrally by the Bank’s finance function and are subject to audit as part of the year-end audit process • Once the EVA pools are finalised, line managers in each business unit will make discretionary bonus recommendations for each team member taking into consideration qualitative and quantitative criteria (as mentioned above) • Bonus recommendations are then subject to an extensive geographic review involving the People & Organisation function and the executive • Thereafter, these recommendations are subject to a global review by executive management before the IBP Remuneration Committee and DLC Remuneration Committee review and approval process. Deferral of annual bonus awards: other than Material Risk Takers within the Bank All annual bonus awards exceeding a predetermined hurdle level are subject to 60% deferral in respect of the portion that exceeds the hurdle level. The deferred amount is awarded in the form of: forfeitable share awards vesting in three equal tranches over approximately three years; or cash released in three equal tranches over approximately three years. Where shares are being awarded to employees as part of the deferral of performance bonus awards, these are referred to as short- term share awards. These awards are made under the terms of our existing long-term incentive plans. The entire amount of the annual bonus that is not deferred is payable up-front in cash. Deferral of variable remuneration awards: Material Risk Takers within the Bank • MRTs include senior management, risk takers, staff engaged in certain central functions and any other employees whose professional activities have a material impact on the Bank’s risk profile • Individual awards to MRTs are determined based on EVA pools in the same manner as is applicable to all staff (as set out above), and subject to the Bank’s remuneration policy and governance processes (also set out above) • Variable remuneration awards to executive directors of the Bank (excluding executive directors who are employees of a separately regulated firm) and all variable remuneration awards to other MRTs where total variable remuneration is equal to or exceeds £500 000 are subject to 60% deferral • All variable remuneration awards to other MRTs where total variable remuneration is less than £500 000 are subject to 40% deferral • The 40% not deferred in the former instance or the 60% not deferred in the latter instance are awarded as either 50% in cash and 50% in short-term share awards or 100% in short- term share awards • The up-front short-term share awards vest immediately, but are only released after a period of 12 months for all MRTs • All deferrals in the form of short-term share awards (being either 50% or 100% of such deferral) vest over periods of up to seven years and are then subject to an appropriate period of retention, being 12 months, with the exception of risk managers, for which it is six months. 103 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | REMUNERATION REPORT CONTINUED | | | | | | Malus and clawback within the Bank Employees who leave the employment of the Bank prior to the vesting of deferred incentive awards will lose their deferred bonus forfeitable shares other than as a result of retirement, subject to the Bank’s normal good leaver provisions and approval process in exceptional cases. The deferred share and cash awards for MRTs are subject to malus and clawback adjustments. The assessment of whether any malus adjustment should be made to an individual’s unvested awards will be undertaken in line with the IBP Performance Adjustment Policy and within the following framework: • Where there is reasonable evidence of employee misbehaviour • Where the firm or business unit suffers a material failure of risk management • Other relevant events. In these cases, management and the IBP Remuneration Committee will take into account the following factors in determining the extent (if any) to which the quantum of deferred awards should be subject to clawback: • The extent to which the individual had control over the outcome • Failure of internal control systems • The impact of the risk profile of the relevant member of the Bank or business unit • Any violation of the Bank’s culture and values • The long-term impact of the outcome on the Bank or relevant business unit • External factors including market conditions • Any other relevant factors. Specifically for short-term share awards, where profits which were used to determine the original bonus are materially reduced after the bonus determination, the awards will be recalculated for such reduction and consideration will be given to malus and/or clawback (if any) to the extent that the prior period’s EVA pool is reduced and the extent to which it affected each employee. The deferred share awards of non-MRTs are subject to malus adjustments. Long-term incentive: share awards The Bank has a number of share option and long-term share incentive plans that are designed to align the interests of employees with those of shareholder and long-term organisational interests, and to build material share ownership over the long term through share awards. These share option and incentive plans are also used in appropriate circumstances as a mechanism for retaining key talent. Awards are made in the form of forfeitable share awards other than for countries where the taxation of such awards is penal. In these cases awards are made in the form of conditional awards or market strike options. In principle all employees are eligible for long-term incentives. Awards are considered by the IBP Remuneration Committee and made only in the 42-day period following the release of Investec Group’s interim or final financial results in accordance with the Investment Association Principles of Remuneration. These awards comprise three elements, namely: • ‘New starter’ awards may be awarded on a discretionary basis to new starters and are generally linked to salary levels • ‘General allocation’ awards are similar to new starter awards and may be awarded on a discretionary basis to employees who have not had any other share award for a number of years • ‘Top-up’ awards are made at the discretion of line management primarily to ensure multi-year performance and long-term value generation. All proposed long-term incentive awards are recommended by business unit management and approved by the DLC Remuneration Committee and the IBP Remuneration Committee before being awarded. Forfeitable shares for non-MRTs are subject to one-third vesting after approximately three, four and five years, which we believe is appropriate for our business requirements. LTIP awards to MRTs are subject to performance conditions and vest over a period of two to four years, or three to seven years, as determined by regulatory requirements. Such LTIP awards are then subject to a 12-month retention period, with the exception of risk managers, for which it is six months. The awards are forfeited on termination, but ‘good leaver’ discretion is applied in exceptional circumstances. Retention is addressed through the long-term nature of awards granted, which provides an element of ‘lock-in’ for employees throughout the vesting period and allows for multi-year contribution to performance and brand building. | | | | --- | --- | | | | | | For further information on the share option and long- term share incentive plans in operation and in which the directors are eligible to participate, refer to the Investec Group’s 2025 Remuneration Report. | 104 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | REMUNERATION REPORT CONTINUED | | | | | | #### Other remuneration structures Guaranteed variable remuneration Guaranteed variable remuneration comprises all forms of remuneration whose value can be determined prior to award. This includes, but is not limited to sign-on, buy-out and guaranteed awards. Guaranteed variable awards will not be awarded, paid or provided to any individual within the Bank unless they are: • Exceptional • In the context of hiring new staff • Limited to the first year of service. The IBP Remuneration Committee, or the Chair on behalf of the Committee, is required to pre-approve individual remuneration packages (including new joiner, retention and severance remuneration) for the following: • IBP executive directors, in consultation with the DLC Remuneration Committee • IBP PDMRs • IBP Senior Managers as defined under the Senior Managers and Certification Regime (SMCR). All other forms of guaranteed remuneration above pre determined thresholds are reported to the IBP and DLC Remuneration Committees. Retention awards The Bank only pays retention awards to serving staff in exceptional circumstances. In all such cases, the People & Organisation and Reward functions shall review proposed payments to ensure that they are in line with this policy and any other relevant regulation. Additionally, for MRTs, the IBP Remuneration Committee shall review and approve all proposed awards. Circumstances where the Bank will consider making retention awards include the case of a major restructuring of the Group or any subsidiary or one of its business units (for instance in the start-up of a new business line, or the closure of a business line), or where the retention of individuals is essential to the completion of the task. A valid business case for the retention of the individual must be presented to the IBP Remuneration Committee in order for a retention award to be approved. It is required that the PRA be notified prior to a retention award being made to an MRT, and their guidance sought on the appropriateness of retention awards for certain other individuals. Severance awards Severance payments for the early termination of a contract are at executive management’s absolute discretion and must reflect performance achieved over time and be designed in a way that does not reward failure. Severance payments for MRTs in the Bank are subject to all necessary regulatory requirements, and approval by the IBP Remuneration Committee. Other remuneration structures On occasion, the Bank may utilise other remuneration structures which are not mentioned above, in certain pre-agreed circumstances such as are required by our clients or market practice. Discretionary extended pension benefits policy Extended pension payments are very rarely made and any such proposed payments to employees upon reaching retirement are required to be reviewed and approved by the IBP Remuneration Committee for alignment with appropriate laws, policy and regulation. | | | | --- | --- | | | | | | Governance | Compliance and governance statement The IBP Remuneration Report and Investec Group Remuneration Report comply with the provisions of Schedule 8 of the Large and Medium-sized Companies and Groups (Accounts and Reports) (Amendment) Regulations 2008 (as amended), the UK Corporate Governance Code, the UK Companies Act 2006, the Rules of the UK Listing Authority, the UK Financial Conduct Authority rules, the PRA and FCA Remuneration Code and Pillar 3 disclosure requirements. Scope of our remuneration policy The Bank aims to apply remuneration policies to executive directors and employees that are largely consistent across the Bank, but recognises that certain parts of the Bank are governed by local regulations that may contain more onerous requirements in certain respects. In those cases, the higher requirements are applied to that part of the Bank. This is relevant to Investec Bank plc and its subsidiary companies that are subject to the PRA Remuneration Code (as a level 2 organisation as defined therein), and in particular in relation to MRTs. Additionally, where any aspect of our remuneration policy contravenes local laws or regulations, the local laws or regulations shall prevail. 105 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 04 | | Remuneration report | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | REMUNERATION REPORT CONTINUED | | | | | | Directors’ emoluments (audited) ![Audited_information.svg]() | | | | | --- | --- | --- | | | | | | | 2025 £’000 | 2024 £’000 | | Aggregated emoluments (excluding pension contributions) | 10 643 | 10 308 | | Contributions to defined contribution scheme | 137 | 132 | | | 10 780 | 10 440 | | Number of directors in defined contribution scheme | 4 | 4 | | Number of directors in closed defined benefits scheme | — | — | Included in aggregate director emoluments for the current year are performance awards to IBP executive directors. Performance awards comprise £1,340,545 in up-front cash, £1,530,154 in up-front shares (vesting immediately and subject to 12 months’ retention thereafter), £271,500 in deferred cash (vesting equally over three to seven years, subject to regulatory requirements), and £924,548 in deferred short-term share awards (vesting equally over three to seven years, subject to regulatory requirements). Fani Titi was the highest paid director. Emoluments of the highest paid director were £4,322,384 (2024: £3,690,374) excluding £32,307 of pension contribution to the defined contribution scheme, emoluments disclosed for Fani Titi is for services rendered as the Executive Director of Investec Group. The performance awards of the highest paid director comprise £548,790 in up-front cash, £738,399 in up-front shares (vesting immediately and subject to 12 months’ retention thereafter) and £280,783 in deferred short-term share awards (vesting over four to seven years). The emoluments exclude long-term incentives with vesting subject to achievement against future performance conditions. All four executive directors exercised share options during the financial year, this includes Fani Titi as the highest paid director. Fani Titi was granted shares in respect of qualifying services under a long-term incentive scheme. Please refer to the Investec Group Remuneration Report for further details. | | | | --- | --- | | | | | Audited_information.svg | Key Management Personnel (audited) | IAS 24 ‘Related party disclosures’ requires the following additional information for key management compensation. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Compensation of key management personnel | 2025 £’000 | | 2024 £’000 | | | Short-term employee benefits | 17 368 | | 22 556 | | | Other long-term employee benefits | 7 275 | | 4 337 | | | Share-based payments | 2 828 | | 3 859 | | | Total | 27 471 | | 30 752 | | #### Shareholdings, options and other securities of key management personne l | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | 2025 | | 2024 | | | Number of options held over Investec plc or Investec Limited ordinary shares under employee share schemes | 7 775 | | 10 089 | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | 2025 | | 2024 | | | Number of Investec plc or Investec Limited Ordinary shares held beneficially and non-beneficially | 2 071 | | 3 748 | | For the purposes of the UK’s Disclosure and Transparency Rules, members of the Investec Group Executive Team have been designated as Persons Discharging Managerial Responsibilities (PDMR). We have defined key management personnel as the executive directors of Investec Bank plc plus those classified as PDMRs. The PDMRs are the Directors of Investec Bank plc and Mark Currie (Investec Group Chief Risk Officer), Lesley-Anne Gatter (Investec Group Head of People & Organisation), Marc Kahn (Investec Group Chief Strategy Officer), Abey Mokgwatsane (Investec Group Chief Marketing Officer), Cumesh Moodliar (Chief Executive Investec Bank Limited), Nishlan Samujh (Investec Group Finance Director), Stuart Spencer (Investec Group Chief Operations Officer) and Lyndon Subroyen (Investec Group Head of Digital & Technology). 106 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | 05 | | | ## Annual ## financial ## statements IN THIS SECTION | | | | --- | --- | | | | | [108](#i447e4d363cd344738300acdd42f0e3a0_3848290701184) | Independent auditor’s report to the members of Investec Bank plc | | | | | [119](#i447e4d363cd344738300acdd42f0e3a0_265) | Consolidated Income Statement | | | | | [120](#i447e4d363cd344738300acdd42f0e3a0_268) | Consolidated Statement of Total Comprehensive Income | | | | | [121](#i447e4d363cd344738300acdd42f0e3a0_271) | Balance Sheets | | | | | [123](#i447e4d363cd344738300acdd42f0e3a0_274) | Cash Flow Statements | | | | | [124](#i447e4d363cd344738300acdd42f0e3a0_277) | Statements of Changes in Equity | | | | | [128](#i447e4d363cd344738300acdd42f0e3a0_280) | Accounting policies | | | | | [143](#i447e4d363cd344738300acdd42f0e3a0_283) | Notes to the Financial Statements | | | | | [248](#i447e4d363cd344738300acdd42f0e3a0_484) | Notes to risk and capital management | | | | 107 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | | | | Our performance is a testament to the continued execution of our strategy. This section contains Investec Bank plc’s financial statements. 108 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC | | | | | | #### Report on the audit of the financial statements #### Opinion | | | | | --- | --- | --- | | | | | | | | | | | In our opinion: • The financial statements of Investec Bank plc (the ‘Parent company’) and its subsidiaries (the ‘Group’) give a true and fair view of the state of the Group’s and of the Parent company’s affairs as at 31 March 2025 and of the Group’s profit for the year then ended; • The Group financial statements have been properly prepared in accordance with United Kingdom adopted international accounting standards and IFRS Accounting Standards as issued by the International Accounting Standards Board (IASB); • The Parent company financial statements have been properly prepared in accordance with United Kingdom adopted international accounting standards and as applied in accordance with the provisions of the Companies Act 2006; and • The financial statements have been prepared in accordance with the requirements of the Companies Act 2006. | | | | | | We have audited the financial statements which comprise: • The consolidated income statement; •The consolidated statement of total comprehensive income; •The Group and Parent company balance sheets; •The Group and Parent company cash flow statements; •The Group and Parent company statement of changes in equity; •The material accounting policy information; and •The related notes 1 to 69 excluding the risk and capital management disclosures in notes 59 to 69 marked as unaudited. The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable law, United Kingdom adopted international accounting standards and IFRS Accounting Standards as issued by the IASB. The financial reporting framework that has been applied in the preparation of the Parent company financial statements is applicable law and United Kingdom adopted international accounting standards and as applied in accordance with the provisions of the Companies Act 2006. #### Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Group and the Parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the Financial Reporting Council’s (the ‘FRC’s’) Ethical Standard as applied to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. The non-audit services provided to the Group for the year are disclosed in note 7 to the financial statements. We confirm that we have not provided any non-audit services prohibited by the FRC’s Ethical Standard to the Group or the Parent company. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. 109 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC CONTINUED | | | | | | #### Summary of our audit approach | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | Key audit matters | | | The key audit matters that we identified in the current year were: • Provision for expected credit losses (“ECL”) on loans and advances to customers • Valuation of level 3 equity investments and associated unrealised income • Provisions for regulatory and litigation matters In addition to identifying similar key audit matters to the three above, two other key audit matters were identified by the predecessor auditor and described in their audit report for the year ended 31 March 2024. In respect of these items: • The gain on the combination of Investec Wealth & Investments Limited • With Rathbones Group plc is not considered as a key audit matter in the current year, as this related to the acquisition that occurred in the prior year. • IT systems and controls impacting financial reporting is not considered to be a key audit matter as it was not one of the areas which had the most significant impact on our overall audit strategy, allocation of resources or direction of efforts of the engagement team. Within this report, key audit matters are identified as follows: Newly identified Newlyidentified.svg Increased level of risk Increased_level_of_risk.svg Similar level of risk Decreased level of risk Decreased_level_of_risk.svg | | | | | | | | | | | | | | | | | | Materiality | | | The materiality that we used for the Group financial statements was £18 million which was determined on the basis of 4% of profit before taxation. | | | | | | | | | | | | | | | | | | Scoping | | | Our audit work was performed on components which represented 99% of Group’s revenue, 99% of the Group’s profit before taxation and 98% of the Group’s net assets. | | | | | | | | | First year audit transition This is the first year that we have been appointed as auditors to the Group. We undertook a number of transitional procedures to prepare for the audit including establishing our independence from the Group. We used the time prior to commencing our audit to meet with Group management and non-executive directors to gain an understanding of the business and the environment in which it operates as well as the key priorities and challenges. Once independent of the Group, we commenced our audit planning on 8 September 2023. From that date we attended all Audit Committee meetings, initially in an observer capacity, and continued to meet regularly with Group management and non-executive directors. As part of the transition process, we reviewed the audit file for the 2023 year-end audit and shadowed meetings attended by the former auditor to gain an understanding of the Group’s processes, their audit risk assessment, and the controls on which they relied for the purposes of issuing their audit opinion. We also considered historical accounting policies and accounting judgements which further informed our risk assessment. We held regular meetings with audit partners and senior staff who are responsible for undertaking the audits in the most significant divisions and components of the Group. The main purpose of these meetings was to outline our audit approach, including discussing possible significant audit risks, and to brief our teams on the Group’s key processes, systems and structure. 110 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC CONTINUED | | | | | | #### Conclusions relating to going concern In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors’ assessment of the Group’s and Parent company’s ability to continue to adopt the going concern basis of accounting included: • Obtaining an understanding of management’s process to arrive at their conclusion to prepare the financial statements on a going concern basis; •With the involvement of our regulatory specialists: – Challenging the liquidity and capital adequacy and stress testing assumptions used by management, including consideration of regulatory enquiries and observations, management actions and whether applied stresses were reasonable in the context of the Group and Parent company’s operating environment; – Assessing emerging operational, regulatory and market risks facing entities within the Group and the Parent company, including the impact of volatility in global financial markets and management’s strategic initiatives; • Evaluating the Group’s business model and operations; • Assessing the key assumptions supporting the Group’s and Parent company’s latest budget forecasts; • Assessing the historical accuracy of forecasts prepared by management; and • Assessing the appropriateness of going concern disclosures made in the notes to the financial statements. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group’s and Parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. #### Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Provision for expected credit losses (ECL) on loans and advances to customers | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | Key audit matter description | | | The Group had loans and advances to customers subject to ECL amounting to £16,396 million (2024: £16,108 million) with a total ECL provision of £142 million (2024: £174 million) as at 31 March 2025, disclosed in note 26. The estimation of ECL provisions in the Group’s loan portfolios is inherently uncertain and requires significant judgements and estimates. We therefore consider this to be a key audit matter. The ECL is measured both collectively by portfolio and individually for larger exposures in Stage 3. The collective assessment of ECL requires the use of statistical models incorporating loss data and assumptions on the recoverability of customers’ outstanding balances. These models use a number of significant judgements to calculate a probability-weighted estimate by applying a probability of default (“PD”), exposure at default (“EAD”) and a loss given default (“LGD”), taking account of collateral held or other loss mitigants, discounted using the effective interest rate. Individually assessed provision for Stage 3 exposures include significant judgement, including the valuation of collateral and recovery strategies. We identified three specific areas in relation to ECL that require significant management judgement or relate to assumptions to which the overall ECL provision is particularly sensitive. i.     Significant increase in credit risk (“SICR”) for corporate loans: The assessment of whether there has been a significant increase in credit risk for loans from the date of origination of the exposure to 31 March 2025 requires management judgement. There is a risk that management’s assessment of whether a SICR has occurred is inaccurate or that the SICR criteria is incorrectly applied. ii.    Macro-economic scenarios: As indicated in the “key management assumptions” on page 141, the Group develops a range of forward-looking probability weighted macro-economic scenarios. Due to its inherent nature, significant judgement is involved in determining the probability weighting of each scenario and the assumptions and characteristics of each scenario applied. iii.   The valuation of collateral and determination of other significant cash flows for individually assessed corporate Stage 3 loans: Management either employs collateral valuation experts or applies their own judgement to estimate the recoverability of collateral and other cash flows on a case-by-case basis for individually assessed loans. The use of incorrect or inappropriate assumptions in estimating these recoveries could lead to a material misstatement of the ECL. | | 111 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC CONTINUED | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | Key audit matter description continued | | | This key audit matter is discussed in the Audit Committee report on page 78. The financial statement disclosures with respect to this key audit matter are contained in the following notes or reports: • Accounting policies, “Impairment of financial assets held at amortised cost or FVOCI” and “Key management assumptions”; • Note 6, “Expected credit loss impairment charges”; • Note 26, “Loans and advances to customers and other loans and advances”; and • Note 59, “Credit and counterparty risk”. | | | | | | | | | | | | | | | | | | How the scope of our audit responded to the key audit matter | | | We performed the following audit procedures: • Obtained a detailed understanding of the financial controls over the ECL provision, focusing on significant management assumptions and judgements within the ECL calculation. This included a thorough review of management’s data, methodologies, and assumptions used in the ECL models, and a critical assessment of the model governance framework, encompassing controls over the implementation of new and changes to existing ECL models; • Tested the completeness and accuracy of data inputs used in the ECL models. This involved agreeing a sample of data inputs to source information from internal systems and external data providers. Furthermore, we independently recalculated ECL estimates, including PD, EAD, and LGD parameters, to validate management’s assumptions and the appropriateness of judgements applied; • Assessed the appropriateness of ECL-related disclosures for exposures in the financial statements for compliance with IFRS 7 Financial Instruments: Disclosures. We also evaluated the consistency between the credit risk disclosures and the ECL information tested during our audit procedures (including data, models, estimates, and macro-economic forecasts); and • Performed a comprehensive assessment of the overall reasonableness of the ECL provision and coverage ratio (ECL provision to gross advances), considering the credit quality of the Group portfolios, risk profile, and the impact of current economic conditions on the Group’s customers. This included a detailed analysis at both an overall and stage-specific level. Where available, we supplemented this assessment with peer benchmarking to evaluate staging and provision coverage levels. To challenge the Group’s SICR assessment, we: • Supported by our credit specialists, evaluated the Group’s SICR policy and assessed whether it complies with IFRS 9 Financial Instruments (“IFRS 9”); • On a sample basis, tested the completeness and accuracy of the data used in applying the quantitative and qualitative criteria in the SICR assessment to assess whether loans were assigned to the correct stage; and • Performed an independent assessment for a sample of loans in Stage 1 and 2, focusing on higher risk borrowers and borrowers where a stage override had been applied, to determine whether they were appropriately recorded in the correct stage To challenge the Group’s macro-economic scenarios and the probability weightings applied, we: • Supported by our economic specialists, challenged the appropriateness of the macro-economic scenarios and the weightings assigned to them. We assessed the selection of economic variables and forecasts under the scenarios in light of the current economic environment as at 31 March 2025; and • Supported by our credit specialists, assessed methodology and implementation of the models used to translate the economic scenarios and forecasts into expected credit losses, using a combination of recoding and reperformance. To challenge the Group’s assessment of collateral valuation and other significant cash flows for individually assessed loans, we: • Supported by our property valuation specialists and fair value specialists, tested a sample of collateral valuations for individually assessed loans by reference to available market data; • Evaluated the appropriateness of recovery strategies identified; • Challenged the assumptions relating to the timing of cash flows resulting from the sale of collateral, debt settlement agreements or refinance agreements; and • Independently recalculated the ECL provision. | | | | | | | | | | | | | | | | | | Key observations | | | Based on our audit procedures performed as detailed above, we concluded that the ECL provisions on loans and advances to customers are reasonable and recognised in accordance with the requirements of IFRS 9. | | | | | | | | | 112 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC CONTINUED | | | | | | Valuation of level 3 equity investments and associated unrealised income | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | Key audit matter description | | | Financial instruments are classified as Level 1, 2 or 3 in accordance with IFRS 13 Fair Value Measurement (“IFRS 13”). As indicated in the “key management assumptions” on page 141, Level 3 measurements, particularly for complex and illiquid instruments (including unlisted investments), require significant judgement and utilise valuation techniques that are inherently subjective. The economic outlook introduces uncertainty into these estimations. Key inputs are based on the most relevant observable market data, adjusted for specific investment, sector, and market factors. At 31 March 2025, the fair value of the investment portfolio totalled £212 million (2024: £244 million), including Level 3 assets of £210 million (2024: £243 million). These Level 3 investments require significant management judgement, specifically unlisted equity investments which lack observable market information, making fair value determination challenging. The valuation of the above assets and the associated unrealised income have been determined to be a key audit matter in the current year audit as a result of the significant judgement applied and estimation uncertainty involved in the valuation, and the consequent elevation in the risk of material misstatement. In estimating the valuation of these assets, management of the Group has exercised their judgement and applied assumptions in the following areas: • Valuation techniques: Fair value measurements utilise a range of techniques, including discounted cash flow analysis, price-earnings multiples, net asset value calculations and complex valuation models. These techniques are applied to various assets, such as illiquid investments in unquoted private companies. The selection of appropriate techniques and the inherent subjectivity of inputs (e.g., discount rates, growth rates, earnings multiples) introduce significant estimation uncertainty; • Liquidity and market observability: Limited market data and low liquidity necessitate significant management judgement in determining appropriate valuation inputs. These inputs include yield curves, discount rates, volatility estimates, sector-specific factors, expected cash flows, and future earnings projections. The uncertainty inherent in these estimations significantly impacts the overall fair value measurement. This key audit matter is discussed in the Audit Committee report on page 78. The financial statement disclosures with respect to this key audit matter are contained in the following notes: • Accounting policies, “Financial Instruments” and “Key management assumptions”; and • Note 14, “Fair value hierarchy”. | | | | | | | | | | | | | | | | | | How the scope of our audit responded to the key audit matter | | | To challenge the Group’s valuations of Level 3 equity instruments, we performed the following audit procedures: • Obtained an understanding of the relevant financial controls over the valuation process; • Engaged technical accounting specialists to assess the appropriateness of the accounting treatment and classification of certain idiosyncratic financial instruments; and • Engaged our valuation specialists to determine an independent valuation range for certain complex instruments and compare it to management’s valuation. We have performed specific procedures in relation to the following areas: Valuation techniques: • For a sample of investments, we challenged the appropriateness of the valuation methodology, with involvement of our valuation specialists, by performing independent revaluations and comparing the results to management’s output; and • For a sample of investments, we assessed the reasonableness of the key inputs including cash flows, discount rates, and other significant inputs used in discounted cash flow valuations, referencing relevant industry and market data and comparing them to management’s inputs. Limited market observability or liquidity: • For a sample of investments, we compared unobservable inputs used in valuations to alternative data/ input sources. The approach was tailored to the most appropriate method for each asset; and • With the involvement of our valuation specialist, we independently determined valuations for a sample of equity investments, considering independently determined risk factors to establish a range of acceptable fair values. These were compared to management’s valuations. We assessed the appropriateness of the financial statement disclosures in accordance with IFRS 13. | | | | | | | | | | | | | | | | | | Key observations | | | Based on our audit procedures performed as detailed above, we concluded that the valuation of Level 3 equity investments and associated unrealised income is reasonable and in accordance with IFRS 13. | | | | | | | | | 113 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC CONTINUED | | | | | | Provision for regulatory and litigation matters | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | Key audit matter description | | | The Group operates in a regulated environment, inherently facing risks related to litigation, regulatory investigations, and customer remediation. Determining these provisions requires significant judgement under IAS 37, Provisions, Contingent Liabilities and Contingent Assets. Management’s estimate of potential outflows of resources embodying economic benefits is inherently subjective and uncertain. This uncertainty is amplified by the evolving nature of these matters. Therefore, the estimation of the valuation of these provisions constitutes a key audit matter. Motor commission review: As at 31 March 2025, the Group has recognised a £30 million (2024: £30 million) provision for motor finance commission arrangements. The uncertainty regarding this matter was amplified by the recent Court of Appeal decisions on motor finance commission arrangements, a pending Supreme Court appeal, and an ongoing Financial Conduct Authority (‘FCA’) review. Historical German dividend tax arbitrage transactions: The Group also holds a provision that reflects the estimate of financial outflows that could arise as a result of investigations concerning historical German dividend tax arbitrage transactions. The Group’s historical involvement in German dividend tax arbitrage transactions (cum-ex) continues to pose a significant risk. Ongoing investigations by the Cologne Public Prosecutor and the German Federal Tax Office create uncertainty around the ultimate financial impact, potentially affecting provisions and disclosures in the financial statements. While the Group is cooperating with authorities, the ongoing investigations and potential for civil litigation create significant uncertainty. This key audit matter is discussed in the Audit Committee report on page 79. The financial statement disclosures with respect to this key audit matter are contained in the following notes: • Accounting policies and “Key management assumptions”; and • Note 47, “Contingent liabilities, legal matters and provisions”. | | | | | | | | | | | | | | | | | | How the scope of our audit responded to the key audit matter | | | Specifically in respect of the motor commission review , we: • Obtained an understanding of the Group’s governance controls that operate over the selection of assumptions and approval of the value of the provision; • Assessed whether the methodology, data and significant assumptions used in the valuation of the provision are appropriate in the context of the applicable financial reporting framework; • Tested the mathematical accuracy of the model including the completeness and accuracy of data used in the model; • Inspected information available for the historical complaints, both supportive and contradictory, the view of independent analysts and the decisions made by the courts; • Reviewed correspondence with external legal counsel to support the probability weightings applied; • Examined the sensitivity of the reported provision to a range of plausible input assumptions; and • Evaluated whether the disclosures made in the financial statements appropriately reflect the facts and key sources of estimation uncertainty. Specifically in respect of the historical German dividend tax arbitrage transactions matter, we: • Tested the Group’s controls over the review of the appropriateness of • Judgements used to determine a best estimate; • Evaluated and challenged management's scenarios and assumptions underpinning the dividend arbitrage provision, verifying these with external legal counsel; • Reviewed regulatory correspondence with the Cologne Public Prosecutor and the Federal Tax Office; and • Inspected correspondence and made direct inquiry with the Group’s internal and external legal counsel | | | | | | | | | | | | | | | | | | Key observations | | | While there is significant judgement required in estimating the timing and value of any settlement that may be required for the historical German dividend tax arbitrage transactions and motor commission review, we are satisfied that the approach to the recognition, estimation and disclosures of these provisions is consistent with the requirements of IFRS Accounting Standards. | | | | | | | | | 114 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC CONTINUED | | | | | | #### Our application of materiality Materiality We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the economic decisions of a reasonably knowledgeable person would be changed or influenced. We use materiality both in planning the scope of our audit work and in evaluating the results of our work. Based on our professional judgement, we determined materiality for the financial statements as a whole as follows: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Group financial statements | | | Parent company financial statements | | | | | | | | | | | | | | Materiality | | | £18.0 million (2024: £22.3 million as determined by the predecessor auditor) | | | £16.0 million (2024: £13.1 million as determined by the predecessor auditor) | | | | | | | | | | | | | | | | | | | | | | | | Basis for determining materiality | | | 4.0% of profit before taxation The predecessor auditor used 5% of operating profit before impairment of goodwill and amortisation of acquired intangibles and strategic actions. | | | 4.8% of profit before taxation The predecessor auditor used 0.5% of distributable equity. | | | | | | | | | | | | | | | | | | | | | | | | Rationale for the benchmark applied | | | Profit before taxation is a key performance indicator for management and shareholders to assess profitability and performance of the Group. | | | Profit before taxation is a key performance indicator for management and shareholders to assess profitability and performance of the Parent company. | | | | | | | | | | | | Performance materiality We set performance materiality at a level lower than materiality to reduce the probability that, in aggregate, uncorrected and undetected misstatements exceed the materiality for the financial statements as a whole. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Group financial statements | | | Parent company financial statements | | | | | | | | | | | | | | Performance materiality | | | 65% (2024: 50% as used by the predecessor auditor) of Group materiality | | | 65% (2024: 50% as used by the predecessor auditor) of parent company materiality | | | | | | | | | | | | | | | | | | | | | | | | Basis and rationale for determining performance materiality | | | In determining performance materiality, we considered the following factors: a.   The quality of the control environment and whether we were able to rely on controls, as described in Section 7.2; and b.    The results of the previous years’ audits performed by EY, including the nature, value and quantum of misstatements (corrected and uncorrected) identified in the previous audit and our expectation of the likelihood of misstatements recurring in the current period. | | | | | | | | | | | | | | | Error reporting threshold We agreed with the Audit Committee that we would report to the Committee all audit differences in excess of £0.9 million (2024: £1.1 million), as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds. We also report to the Audit Committee on disclosure matters that we identified when assessing the overall presentation of the financial statements. 115 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC CONTINUED | | | | | | #### An overview of the scope of our audit Identification and scoping of components Our audit was scoped by obtaining an understanding of the Group and its environment and assessing the risks of material misstatement at the Group level. We structured our approach to the audit to reflect how the Group is organised so that our audit was both effective and risk focused. We selected components at which audit work needed to be performed in order to provide an appropriate basis for undertaking audit work to address the risks of material misstatement of the combined consolidated financial statements. For the purposes of our audit scope, we defined a component as a single reporting unit for which management prepares a reporting package within the group consolidation. Due to the centralised nature of the business, which includes central management of financial reporting for components, a significant portion of our testing was performed centrally by the Group audit team in the UK. Our Group audit scoping identified specific classes of transactions and account balances relating to two components. Where we identified that certain processes, controls and other financial reporting activities were not centrally managed and were instead performed locally, we instructed our component auditors in the UK and Switzerland to perform audit work over these specific classes of transactions and account balances. Audit procedures for all other classes of transactions and account balances determined to be within the scope of the Group audit were performed by the Group auditor. These procedures were performed using component performance materialities ranging from £1.1 million to £9.1 million which are set at a different level to the Group and statutory performance materialities as set out in section 6.2. Our audit work was performed on components which represented 99% of Group’s revenue, 99% of the Group’s profit before taxation and 98% of the Group’s net assets. In addition, we carried out reviews at a Group level to confirm our conclusion that there were no significant risks of material misstatement of the aggregated financial information of the remaining components not subject to audit. Revenue ![3848290763887]() | | | | | --- | --- | --- | | | | | | | Audit of entire financial information | 82% | | | Audit of specific account balance | 17% | | | Review at Group level | 6% | Profit before tax ![6502]() | | | | | --- | --- | --- | | | | | | | Audit of entire financial information | 84% | | | Audit of specific account balance | 15% | | | Review at Group level | 1% | Net assets ![6533]() | | | | | --- | --- | --- | | | | | | | Audit of entire financial information | 92% | | | Audit of specific account balance | 6% | | | Review at Group level | 2% | Our consideration of the control environment The Group relies on several key IT systems and applications for accurate and complete financial transaction recording. These systems, integral to the financial reporting process, include the main financial reporting, trading, deposit, and treasury systems. These systems support various key business cycles, including (but not limited to) revenue recognition, loan initiation and disbursement, deposits, derivative valuation and hedge accounting and journal entry processing. IT specialists within the Group audit team obtained an understanding of IT controls managed centrally at the Group or divisional level. With involvement of our IT specialists, we tested the general IT controls (GITCs), including those related to access management and change management. We also tested relevant IT application controls, focusing on the key systems mentioned above. We planned to rely on IT controls and business controls for the key business cycles. However, due to identified IT control deficiencies related to application user access management and privileged access accounts, we could not rely on controls for certain customer deposits portfolio and for the derivative valuation and hedge accounting processes. Consequently, we adopted a fully substantive approach for these areas. For all other areas, we were able to rely on controls as planned. The deficiencies identified above have been reported to the Audit Committee as part of the 31 March 2025 year-end audit and management is working on a remediation plan as disclosed in the Audit Committee report on page 81. All other deficiencies were communicated to management. 116 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC CONTINUED | | | | | | Our consideration of climate-related risks In planning our audit, we considered the potential impact of climate change on the Group’s business and its financial statements. The Group continues to develop its assessment of and response to the potential impacts of environmental, social and governance (“ESG”) related risks, including climate change, as outlined in the Sustainability Report and climate related financial disclosures. We held discussions with management to understand the process for identifying climate-related risks, the consideration of mitigating actions and the impact on the Group’s financial statements which can be found in the Climate- related financial disclosures aligned to the Taskforce on Climate-related Financial Disclosure (“TCFD”) requirements on pages 321 to 330. Management do not expect any material climate change related financial impact on their business, as disclosed on page 141 to the financial statements. We performed our own qualitative risk assessment of the potential impact of climate change on the Group’s account balances and classes of transactions based on our understanding of the nature of the Group’s underlying operations. We read the climate-related disclosures included in the Investec Annual Report 2025 and considered whether they are materially consistent with the financial statements and our knowledge obtained in the audit. Working with other auditors Detailed audit instructions were sent to the component auditors in UK and Switzerland. These instructions identified the relevant risks of material misstatement for significant account balances, classes of transactions and disclosures, including those that were identified as significant risks. The instructions also set out certain audit procedures to be performed and the information to be reported back to the Group audit team, and other matters relevant to the audit. In addition, the Group audit team was involved in the audit work performed by component auditors through a combination of: regular interaction with component teams during the year using video conferencing tools, including planning and closing calls; onsite visits by the Group engagement partner and other team members to components in UK and Switzerland; and review of related component inter-office reporting, their audit files and findings from their work. #### Other information The other information comprises the information included in the annual report other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. | | | | | --- | --- | --- | | | | | | | | | | | We have nothing to report in this regard. | | | | | | #### Responsibilities of directors As explained more fully in the directors’ responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the Group’s and the Parent company’s ability to continue as a going concern, disclosing as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the Parent company or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of #### the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report. Extent to which the audit was considered capable of detecting irregularities, including fraud Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. 117 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC CONTINUED | | | | | | Identifying and assessing potential risks related to irregularities In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non- compliance with laws and regulations, we considered the following: • The nature of the industry and sector, control environment and business performance including the design of the Group’s remuneration policies, key drivers for directors’ remuneration, bonus levels and performance targets; • the Group’s own assessment of the risks that irregularities may occur either as a result of fraud or error; • Results of our enquiries of management, internal audit, members of the legal, risk and compliance functions, the directors and the audit committee about their own identification and assessment of the risks of irregularities, including those that are specific to the Group’s sector; • Any matters we identified having obtained and reviewed the Group’s documentation of their policies and procedures relating to: – Identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance; – Detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; – The internal controls established to mitigate risks of fraud or non-compliance with laws and regulations; • The matters discussed among the audit engagement team including component audit teams and relevant internal specialists, including tax, credit, valuations, IT, regulatory and industry specialists regarding how and where fraud might occur in the financial statements and any potential indicators of fraud. As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the judgements and estimates used to determine the calculation of expected credit losses and the valuation of Level 3 equity investments and the associated unrealised income. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. We also obtained an understanding of the legal and regulatory frameworks that the Group operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act, as well as those laws and regulations prevailing in each country in which components were subject to audit procedures, including taxation legislation. In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the Group’s ability to operate or to avoid a material penalty. These included regulations and supervisory requirements of the Prudential Regulatory Authority, Financial Reporting Council and Financial Conduct Authority regulatory requirements. Audit response to risks identified As a result of performing the above, we identified the provision for expected credit losses on loans and advances to customers and the valuation of level 3 investments and associated unrealised income as key audit matters related to the potential risk of fraud. The key audit matters section of our report explains the matters in more detail and also describes the specific procedures we performed in response to those key audit matters. In addition to the above, our procedures to respond to risks identified included the following: • Reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements; • Enquiring of management, the audit committee and in-house and external legal counsel concerning actual and potential litigation and claims; • performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; • Reading minutes of meetings of those charged with governance, reviewing internal audit reports and reviewing correspondence with regulatory bodies such as the, PRA, FCA and HMRC; and • In addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members including internal specialists and component audit teams, and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit. 118 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INVESTEC BANK PLC CONTINUED | | | | | | #### Report on other legal and regulatory requirements Opinions on other matters prescribed by the Companies Act 2006 | | | | | --- | --- | --- | | | | | | | | | | | In our opinion, based on the work undertaken in the course of the audit: • The information given in the strategic report and the directors’ report for the financial year for which the • Financial statements are prepared is consistent with the financial statements; and • The strategic report and the directors’ report have been prepared in accordance with applicable legal requirements. In the light of the knowledge and understanding of the Group and the parent company and their environment obtained in the course of the audit, we have not identified any material misstatements in the strategic report or the directors’ report. | | | | | | Matters on which we are required to report by exception Adequacy of explanations received and accounting records Under the Companies Act 2006 we are required to report to you if, in our opinion: • We have not received all the information and explanations we require for our audit; or • Adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or • The parent company financial statements are not in agreement with the accounting records and returns. | | | | | --- | --- | --- | | | | | | | | | | | We have nothing to report in respect of these matters. | | | | | | Directors’ remuneration Under the Companies Act 2006 we are also required to report if in our opinion certain disclosures of directors’ remuneration have not been made. | | | | | --- | --- | --- | | | | | | | | | | | We have nothing to report in respect of this matter. | | | | | | Other matters which we are required to #### address Auditor tenure Following the recommendation of the audit committee, we were appointed by the Company at its annual general meeting on 8 August 2024 to audit the financial statements for the year ending 31 March 2025 and subsequent financial periods. The period of total uninterrupted engagement including previous renewals and reappointments of the firm is accordingly one year. Consistency of the audit report with the additional report to the audit committee Our audit opinion is consistent with the additional report to the audit committee we are required to provide in accordance with ISAs (UK). #### Use of our report This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed. As required by the Financial Conduct Authority (FCA) Disclosure Guidance and Transparency Rule (DTR) 4.1.15R – DTR 4.1.18R, these financial statements will form part of the Electronic Format Annual Financial Report filed on the National Storage Mechanism of the FCA in accordance with DTR 4.1.15R – DTR 4.1.18R. This auditor’s report provides no assurance over whether the Electronic Format Annual Financial Report has been prepared in compliance with DTR 4.1.15R – DTR 4.1.18R. We have been engaged to provide assurance on whether the Electronic Format Annual Financial Report has been prepared in compliance with DTR 4.1.15R – DTR 4.1.18R and will publicly report separately to the members on this. ![Tom Miller.jpg]() #### Tom Millar , FCA (Senior statutory auditor) For and on behalf of Deloitte LLP Statutory Auditor London, United Kingdom 19 June 2025 119 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CONSOLIDATED INCOME STATEMENT | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | For the year to 31 March | | | 2025 | | 2024^ | | | £’000 | Notes | | | | | Interest income | 2 | | 1 979 851 | | 1 933 984 | | | Interest income calculated using effective interest rate method | | | 1 888 110 | | 1 840 589 | | | Other interest income | | | 91 741 | | 93 395 | | | Interest expense | 2 | | (1 189 390) | | (1 105 027) | | | Net interest income | | | 790 461 | | 828 957 | | | Fee and commission income | 3 | | 194 340 | | 178 770 | | | Fee and commission expense | 3 | | (13 864) | | (16 381) | | | Investment income | 4 | | 41 811 | | 2 625 | | | Share of post-taxation profit of associates and joint venture holdings | 28 | | 38 081 | | 9 032 | | | Profit before amortisation and integration costs | | | 72 380 | | 31 287 | | | Amortisation of acquired intangibles | | | (6 312) | | (12 624) | | | Acquisition related and integration costs of associate | | | (27 987) | | (9 631) | | | Trading income/(loss) arising from | | | | | | | | – customer flow\* | | | 85 542 | | 103 158 | | | – balance sheet management and other trading activities | | | 14 248 | | 27 119 | | | Other operating income | 5 | | 6 676 | | 2 915 | | | Operating income | | | 1 157 295 | | 1 136 195 | | | Expected credit loss impairment charges | 6 | | (97 040) | | (85 997) | | | Operating income after expected credit loss impairment charges | | | 1 060 255 | | 1 050 198 | | | Operating costs | 7 | | (597 719) | | (626 732) | | | Amortisation of acquired intangibles | 33 | | — | | (940) | | | Closure and rundown of the Hong Kong direct investments business | | | 319 | | (784) | | | Financial impact of strategic actions | | | (16 007) | | — | | | Profit before taxation | | | 446 848 | | 421 742 | | | Taxation on operating profit before acquired intangibles and strategic actions | 10 | | (80 222) | | (96 956) | | | Taxation on acquired intangibles and strategic actions | 10 | | (195) | | 427 | | | Profit after taxation from continuing operations | | | 366 431 | | 325 213 | | | Profit after taxation from discontinued operations | 34 | | — | | 395 600 | | | Profit after taxation | | | 366 431 | | 720 813 | | | Profit attributable to non-controlling interests | | | (12) | | (1 204) | | | Earnings attributable to shareholder | | | 366 419 | | 719 609 | | ^Restated as detailed in note 57. \*Included within Trading income/(loss) arising from customer flow is income of £93.8 million ( 31 March 2024 : £105.1 million) and interest expense of £8.3 million ( 31 March 2024 : £ 1.9 million). 120 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CONSOLIDATED STATEMENT OF TOTAL COMPREHENSIVE INCOME | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | For the year to 31 March | | | 2025 | | 2024 | | | £’000 | Notes | | | | | | | | | | | | | Profit after taxation from continuing operations | | | 366 431 | | 325 213 | | | Other comprehensive income/(loss) from continuing operations: | | | | | | | | Items that may be reclassified to the income statement: | | | | | | | | Fair value movements on cash flow hedges taken directly to other comprehensive income\* | | | (11 259) | | (9 971) | | | Gains on realisation of debt instruments at FVOCI recycled through the income statement\* | | | (166) | | (817) | | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income\* | | | (6 120) | | 6 078 | | | Foreign currency adjustments on translating foreign operations | | | (4 305) | | (3 601) | | | Items that will not be reclassified to the income statement: | | | | | | | | Share of other comprehensive income of associates and joint venture holdings | | | (3 803) | | 257 | | | Total comprehensive income from continuing operations | | | 340 778 | | 317 159 | | | Total comprehensive loss attributable to non-controlling interests | | | 12 | | 1 183 | | | Total comprehensive income attributable to ordinary shareholder | | | 302 410 | | 295 338 | | | Total comprehensive income attributable to Additional Tier 1 securities | | | 38 356 | | 20 638 | | | Total comprehensive income | | | 340 778 | | 317 159 | | | | | | | | | | | Profit after taxation from discontinued operations | | | — | | 395 600 | | | Total comprehensive income from discontinued operations | | | — | | 395 600 | | | Total comprehensive income attributable to non-controlling interests from discontinued operations | | | — | | — | | | Total comprehensive income attributable to ordinary shareholders from discontinued operations | | | — | | 395 600 | | | Total comprehensive income from discontinued operations | | | — | | 395 600 | | | | | | | | | | | Profit after taxation | | | 366 431 | | 720 813 | | | Other comprehensive income/(loss): | | | | | | | | Items that may be reclassified to the income statement: | | | | | | | | Fair value movements on cash flow hedges taken directly to other comprehensive income\* | | | (11 259) | | (9 971) | | | Gains on realisation of debt instruments at FVOCI recycled through the income statement\* | 10 | | (166) | | (817) | | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income\* | 10 | | (6 120) | | 6 078 | | | Foreign currency adjustments on translating foreign operations | | | (4 305) | | (3 601) | | | Items that will not be reclassified to the income statement: | | | | | | | | Share of other comprehensive income of associates and joint venture holdings | | | (3 803) | | 257 | | | Total comprehensive income | | | 340 778 | | 712 759 | | | Total comprehensive loss attributable to non-controlling interests | | | 12 | | 1 183 | | | Total comprehensive income attributable to ordinary shareholders | | | 302 410 | | 690 938 | | | Total comprehensive income attributable to Additional Tier 1 securities | | | 38 356 | | 20 638 | | | | | | | | | | | Total comprehensive income | | | 340 778 | | 712 759 | | | | | | | | | | \*Net of £7.0 million tax credit ( 31 March 2024: £ 8.8 million tax charge). 121 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | BALANCE SHEETS | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | | | | | | 31 March 2025 | | 31 March 2024^ | | 1 April 2023^ | | | £’000 | Notes | | | | | Assets | | | | | | | | | Cash and balances at central banks | 17 | 4 191 750 | | 5 661 623 | | 5 400 401 | | | Loans and advances to banks | 18 | 859 802 | | 676 001 | | 892 791 | | | Reverse repurchase agreements and cash collateral on securities borrowed | 19 | 1 640 765 | | 1 140 115 | | 1 338 699 | | | Sovereign debt securities | 20 | 2 524 702 | | 1 928 134 | | 1 221 744 | | | Bank debt securities | 21 | 324 179 | | 297 255 | | 204 691 | | | Other debt securities | 22 | 770 722 | | 708 285 | | 697 275 | | | Derivative financial instruments | 23 | 325 886 | | 432 395 | | 640 604 | | | Securities arising from trading activities | 24 | 149 912 | | 157 332 | | 127 537 | | | Loans and advances to customers | 26 | 16 813 723 | | 16 570 313 | | 15 567 809 | | | Other loans and advances | 26 | 162 882 | | 145 545 | | 172 087 | | | Other securitised assets | 27 | — | | 66 702 | | 78 231 | | | Investment portfolio | 25 | 211 753 | | 244 140 | | 311 618 | | | Interests in associated undertakings and joint venture holdings | 28 | 832 141 | | 791 272 | | 10 851 | | | Current taxation assets | | 7 016 | | 13 254 | | 9 890 | | | Deferred taxation assets | 29 | 120 918 | | 119 730 | | 111 513 | | | Other assets | 30 | 677 318 | | 750 347 | | 980 388 | | | Property and equipment | 31 | 58 940 | | 72 947 | | 121 014 | | | Goodwill | 32 | 56 934 | | 58 082 | | 249 503 | | | Software | 33 | 4 742 | | 4 571 | | 9 415 | | | Other acquired intangible assets | 33 | — | | — | | 43 887 | | | | | 29 734 085 | | 29 838 043 | | 28 189 948 | | | Liabilities | | | | | | | | | Deposits by banks | | 1 477 568 | | 2 174 305 | | 2 172 170 | | | Derivative financial instruments | 23 | 274 791 | | 409 255 | | 645 866 | | | Other trading liabilities | 35 | 16 242 | | 18 449 | | 28 184 | | | Repurchase agreements and cash collateral on securities lent | 19 | 178 202 | | 85 091 | | 139 529 | | | Customer accounts (deposits) | 36 | 21 555 444 | | 20 851 216 | | 19 251 399 | | | Debt securities in issue | 37 | 974 371 | | 956 887 | | 1 140 879 | | | Liabilities arising on securitisation of other assets | 27 | — | | 71 751 | | 81 609 | | | Current taxation liabilities | | 9 023 | | 8 624 | | 4 813 | | | Other liabilities | 38 | 893 546 | | 987 437 | | 1 204 562 | | | | | 25 379 187 | | 25 563 015 | | 24 669 011 | | | Subordinated liabilities | 39 | 682 218 | | 668 810 | | 731 483 | | | | | 26 061 405 | | 26 231 825 | | 25 400 494 | | | Equity | | | | | | | | | Ordinary share capital | 40 | 1 280 550 | | 1 280 550 | | 1 280 550 | | | Share premium | | 199 538 | | 199 538 | | 199 538 | | | Capital reserve | | — | | 11 274 | | 153 177 | | | Other reserves | | 4 674 | | 26 524 | | 34 814 | | | Retained income | | 1 836 722 | | 1 627 373 | | 870 424 | | | Shareholder’s equity excluding non-controlling interests | | 3 321 484 | | 3 145 259 | | 2 538 503 | | | Additional Tier 1 securities in issue | 42 | 350 000 | | 458 108 | | 250 000 | | | Non-controlling interests in partially held subsidiaries | 43 | 1 196 | | 2 851 | | 951 | | | Total equity | | 3 672 680 | | 3 606 218 | | 2 789 454 | | | Total liabilities and equity | | 29 734 085 | | 29 838 043 | | 28 189 948 | | ^Restated as detailed in note 57. Included in Loans and advances to banks £48 million (31 March 2024: £19 million); Sovereign debt securities £178 million (31 March 2024: £28 million); Bank debt securities £15 million (31 March 2024: £39 million); Securities arising from trading activities £9 million (31 March 2024: £19 million) and Other loans and advances £0.5 million (31 March 2024: £3 million) are assets provided as collateral where the transferee has the right to resell or repledge. #### Ruth Leas Chief Executive 19 June 2025 122 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | BALANCE SHEETS CONTINUED | | | | | | As at 31 March 2025 | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Company | | | | | | | | 2025 | | 2024 | | | £’000 | Notes | | | | | Assets | | | | | | | | Cash and balances at central banks | 17 | | 4 175 092 | | 5 650 257 | | | Loans and advances to banks | 18 | | 450 989 | | 290 068 | | | Reverse repurchase agreements and cash collateral on securities borrowed | 19 | | 1 640 765 | | 1 140 115 | | | Sovereign debt securities | 20 | | 1 495 200 | | 1 077 424 | | | Bank debt securities | 21 | | 324 179 | | 289 531 | | | Other debt securities | 22 | | 1 395 161 | | 1 415 230 | | | Derivative financial instruments | 23 | | 311 854 | | 421 230 | | | Securities arising from trading activities | 24 | | 149 912 | | 157 332 | | | Loans and advances to customers | 26 | | 12 793 481 | | 12 692 623 | | | Other loans and advances | 26 | | 3 340 506 | | 3 311 808 | | | Other securitised assets | 27 | | — | | 468 | | | Investment portfolio | 25 | | 32 027 | | 43 677 | | | Interests in associated undertakings and joint venture holdings | 28 | | 787 400 | | 781 674 | | | Current taxation assets | | | 33 049 | | 31 456 | | | Deferred taxation assets | 29 | | 50 454 | | 58 572 | | | Other assets | 30 | | 388 833 | | 447 974 | | | Property and equipment | 31 | | 35 325 | | 45 716 | | | Investment in subsidiaries | 55 | | 461 636 | | 451 867 | | | | | | 27 865 863 | | 28 307 022 | | | Liabilities | | | | | | | | Deposits by banks | | | 1 968 896 | | 2 558 021 | | | Derivative financial instruments | 23 | | 267 909 | | 429 675 | | | Other trading liabilities | 35 | | 16 242 | | 18 449 | | | Repurchase agreements and cash collateral on securities lent | 19 | | 328 534 | | 235 447 | | | Customer accounts (deposits) | 36 | | 19 952 173 | | 19 720 605 | | | Debt securities in issue | 37 | | 973 176 | | 955 694 | | | Other liabilities | 38 | | 621 967 | | 655 025 | | | | | | 24 128 897 | | 24 572 916 | | | Subordinated liabilities | 39 | | 682 218 | | 668 810 | | | | | | 24 811 115 | | 25 241 726 | | | Equity | | | | | | | | Ordinary share capital | 40 | | 1 280 550 | | 1 280 550 | | | Share premium | | | 199 538 | | 199 538 | | | Capital reserve | | | — | | 11 528 | | | Other reserves | | | 1 614 | | 19 553 | | | Retained income | | | 1 223 046 | | 1 096 019 | | | Shareholder’s equity excluding non-controlling interests | | | 2 704 748 | | 2 607 188 | | | Additional Tier 1 securities in issue | 42 | | 350 000 | | 458 108 | | | Total equity | | | 3 054 748 | | 3 065 296 | | | Total liabilities and equity | | | 27 865 863 | | 28 307 022 | | The Company's profit for the year, determined in accordance with the Companies Act 2006, was £275.0 million ( 2024 : £613.8 million). The Company has taken advantage in Section 408 of the Companies Act 2006 not to present its own profit and loss account. Included in Loans and advances to banks £48 million (31 March 2024: £19 million); Sovereign debt securities £178 million (31 March 2024: £28 million); Bank debt securities £15 million (31 March 2024: £39 million); Securities arising from trading activities £9 million (31 March 2024: £19 million); Other loans and advances £0.5 million (31 March 2024: £3 million) and Other debt securities £624 million (31 March 2024: £706 million) are assets provided as collateral where the transferee has the right to resell or repledge. #### Ruth Leas Chief Executive 19 June 2025 123 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CASH FLOW STATEMENTS | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Group | | | | Company | | | | | For the year to 31 March | | 2025 | | 2024^ | | 2025 | | 2024 | | | £’000 | Notes | | | | | | Profit before taxation adjusted for non-cash items | 45 | 552 838 | | 567 094 | | 336 541 | | 382 326 | | | Taxation paid | | (64 733) | | (110 339) | | (43 096) | | (79 894) | | | Dividends received from subsidiaries and associates and joint venture holdings | | — | | — | | 104 820 | | 79 798 | | | Increase in operating assets | 45 | (1 317 141) | | (1 471 004) | | (994 387) | | (1 459 675) | | | (Decrease)/increase in operating liabilities | 45 | (132 847) | | 1 273 760 | | (427 470) | | 1 430 407 | | | Net cash (outflow)/inflow from operating activities | | (961 883) | | 259 511 | | (1 023 592) | | 352 962 | | | Cash flow on acquisition of Group operations and subsidiaries, net of cash acquired | | — | | (28 559) | | — | | — | | | Cash flow on disposal of Group operations and subsidiaries | | — | | — | | 899 | | — | | | Derecognition of cash on deconsolidation and disposal of subsidiaries\* | | — | | (172 615) | | — | | — | | | Cash flow on acquisition of property, equipment, software and other intangible assets | | (3 943) | | (3 848) | | (139) | | (1 183) | | | Cash flow on disposal of property, equipment, software and other intangible assets | | 204 | | 157 | | — | | 141 | | | Injection of capital to subsidiary | | — | | — | | (7 100) | | (49 630) | | | Return of capital by subsidiary | | — | | — | | — | | 9 924 | | | Net cash outflow from investing activities | | (3 739) | | (204 865) | | (6 340) | | (40 748) | | | Dividends paid to ordinary shareholder | | (120 000) | | (89 798) | | (120 000) | | (89 798) | | | Dividends paid to other equity holders | | (42 223) | | (16 771) | | (42 223) | | (16 771) | | | Proceeds on issue of Additional Tier 1 Securities | | — | | 350 000 | | — | | 350 000 | | | Redemption of Additional Tier 1 instruments | | (108 108) | | (140 472) | | (108 108) | | (140 472) | | | Redemption of subordinated debt | | — | | (70 000) | | — | | (70 000) | | | Lease liabilities paid | | (43 776) | | (42 444) | | (8 769) | | (7 496) | | | Net cash (outflow)/inflow from financing activities | | (314 107) | | (9 485) | | (279 100) | | 25 463 | | | Effects of exchange rate changes on cash and cash equivalents | | (1 128) | | (498) | | — | | — | | | Net (decrease)/increase in cash and cash equivalents | | (1 280 857) | | 44 663 | | (1 309 032) | | 337 677 | | | Cash and cash equivalents at the beginning of the year | | 6 332 409 | | 6 287 746 | | 5 935 113 | | 5 597 436 | | | Cash and cash equivalents at the end of the year | | 5 051 552 | | 6 332 409 | | 4 626 081 | | 5 935 113 | | | Cash and cash equivalents is defined as including: | | | | | | | | | | | Cash and balances at central banks | | 4 191 750 | | 5 661 623 | | 4 175 092 | | 5 650 257 | | | On demand loans and advances to banks | | 859 802 | | 670 786 | | 450 989 | | 284 856 | | | Cash and cash equivalents at the end of the year | | 5 051 552 | | 6 332 409 | | 4 626 081 | | 5 935 113 | | ^Restated as detailed in note 57. \*Includes cash and cash equivalents derecognised from Investec Wealth & Investment Limited balance sheet as a result of the all-share combination with Rathbones Group PLC. There are no other cash flow impacts as a result of this transaction. Cash and cash equivalents have a maturity profile of less than three months. Loans and advances to banks with a maturity profile of greater than three months are £nil ( 31 March 2024: £ 5.2 million) for Group. Company £nil (31 March 2024 : £5.2 million). Included within net cash (outflow)/inflow from operating activities for the Group is interest received of £1 953 million ( 2024: £1 849 million), interest paid of £1 253 million (2024 : £ 886 million) and dividends received of £4.5 million (2024: £1.5 million). The Company includes interest received of £1 698 million (2024: £1 570 million), interest paid of £1 220 million ( 2024: £865 million) and dividends received of £107.5 million ( 2024: £81.0 million) including those received from its subsidiaries. Cash flow from discontinued operations In the prior year, cash inflows from operating activities of £13.0 million, cash outflows from investing activities of £0.6 million and cash outflows from financing activities of £56.4 million were incurred in the year relating to discontinued operations. Cash flows from discontinued operations have been included in the consolidated statement of cash flow above. 124 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STATEMENT OF CHANGES IN EQUITY | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | | | | | | £’000 | Ordinary share capital | Share premium | Capital reserve account | | Group | | | | | At 1 April 2023 | 1 280 550 | 199 538 | 153 177 | | Movement in reserves 1 April 2023 – 31 March 2024 | | | | | Profit after taxation | — | — | — | | Gains on realisation of debt instruments at FVOCI recycled through the income statement | — | — | — | | Fair value movements on cash flow hedges taken directly to other comprehensive income | — | — | — | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income | — | — | — | | Foreign currency adjustments on translating foreign operations | — | — | — | | Share of other comprehensive income of associates and joint ventures | — | — | — | | Total comprehensive income for the year | — | — | — | | Share-based payments adjustments | — | — | — | | Employee benefit liability recognised | — | — | — | | Transaction with equity holders | — | — | — | | Issue of Additional Tier 1 security instruments | — | — | — | | Redemption of Additional Tier 1 security instruments | — | — | — | | Dividends paid to ordinary shareholder | — | — | — | | Dividends declared to Additional Tier 1 security holders | — | — | — | | Dividends paid to Additional Tier 1 security holders | — | — | — | | Gains on Additional Tier 1 security instruments callback | — | — | — | | Net equity impact of non-controlling interest movements | — | — | — | | Release of capital reserve to retained income | — | — | (141 903) | | At 31 March 2024 | 1 280 550 | 199 538 | 11 274 | | Movement in reserves 1 April 2024 – 31 March 2025 | | | | | Profit after taxation | — | — | — | | Gains on realisation of debt instruments at FVOCI recycled through the income statement | — | — | — | | Fair value movements on cash flow hedges taken directly to other comprehensive income | — | — | — | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income | — | — | — | | Foreign currency adjustments on translating foreign operations | — | — | — | | Share of other comprehensive income of associates and joint venture holdings | — | — | — | | Total comprehensive income for the year | — | — | — | | Share-based payments adjustments | — | — | — | | Employee benefit liability recognised | — | — | — | | Redemption of Additional Tier 1 security instruments | — | — | — | | Dividends paid to ordinary shareholder | — | — | — | | Dividends declared to Additional Tier 1 security holders | — | — | — | | Dividends paid to Additional Tier 1 security holders | — | — | — | | Net equity impact of non-controlling interest movements | — | — | — | | Net equity movements in associates and joint ventures | — | — | — | | Release of capital reserve to retained income | — | — | (11 274) | | At 31 March 2025 | 1 280 550 | 199 538 | — | 125 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STATEMENT OF CHANGES IN EQUITY CONTINUED | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Other reserves | | | | | | | | | | | | | Fair value reserve | Cash flow hedge reserve | Foreign currency reserves | Retained income | | Shareholder’s equity excluding non- controlling interests | | Additional Tier 1 securities in issue | Non- controlling interests | | Total equity | | | | | | | | | | | | | | | | 310 | 27 635 | 6 869 | 870 424 | | 2 538 503 | | 250 000 | 951 | | 2 789 454 | | | | | | | | | | | | | | | | — | — | — | 719 609 | | 719 609 | | — | 1 204 | | 720 813 | | | (817) | — | — | — | | (817) | | — | — | | (817) | | | — | (9 971) | — | — | | (9 971) | | — | — | | (9 971) | | | 6 078 | — | — | — | | 6 078 | | — | — | | 6 078 | | | — | — | (3 580) | — | | (3 580) | | — | (21) | | (3 601) | | | — | — | — | 257 | | 257 | | — | — | | 257 | | | 5 261 | (9 971) | (3 580) | 719 866 | | 711 576 | | — | 1 183 | | 712 759 | | | — | — | — | 5 427 | | 5 427 | | — | — | | 5 427 | | | — | — | — | 1 740 | | 1 740 | | — | — | | 1 740 | | | — | — | — | (2 971) | | (2 971) | | — | — | | (2 971) | | | — | — | — | — | | — | | 350 000 | — | | 350 000 | | | — | — | — | — | | — | | (141 892) | — | | (141 892) | | | — | — | — | (89 798) | | (89 798) | | — | — | | (89 798) | | | — | — | — | (20 638) | | (20 638) | | 20 638 | — | | — | | | — | — | — | — | | — | | (20 638) | — | | (20 638) | | | — | — | — | 1 420 | | 1 420 | | — | — | | 1 420 | | | — | — | — | — | | — | | — | 717 | | 717 | | | — | — | — | 141 903 | | — | | — | — | | — | | | 5 571 | 17 664 | 3 289 | 1 627 373 | | 3 145 259 | | 458 108 | 2 851 | | 3 606 218 | | | | — | | | | | | | | | | | | — | — | — | 366 419 | | 366 419 | | — | 12 | | 366 431 | | | (166) | — | — | — | | (166) | | — | — | | (166) | | | — | (11 259) | — | — | | (11 259) | | — | — | | (11 259) | | | (6 120) | — | — | — | | (6 120) | | — | — | | (6 120) | | | — | — | (4 305) | — | | (4 305) | | — | — | | (4 305) | | | — | — | — | (3 803) | | (3 803) | | — | — | | (3 803) | | | (6 286) | (11 259) | (4 305) | 362 616 | | 340 766 | | — | 12 | | 340 778 | | | — | — | — | 107 | | 107 | | — | — | | 107 | | | — | — | — | 402 | | 402 | | — | — | | 402 | | | — | — | — | — | | — | | (108 108) | — | | (108 108) | | | — | — | — | (120 000) | | (120 000) | | — | — | | (120 000) | | | — | — | — | (38 356) | | (38 356) | | 38 356 | — | | — | | | — | — | — | — | | — | | (38 356) | — | | (38 356) | | | — | — | — | 1 755 | | 1 755 | | — | (1 667) | | 88 | | | — | — | — | (8 449) | | (8 449) | | — | — | | (8 449) | | | — | — | — | 11 274 | | — | | — | — | | — | | | (715) | 6 405 | (1 016) | 1 836 722 | | 3 321 484 | | 350 000 | 1 196 | | 3 672 680 | | 126 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STATEMENT OF CHANGES IN EQUITY CONTINUED | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | | | | | | £’000 | Ordinary share capital | Share premium | Capital reserve account | | Company | | | | | At 1 April 2023 | 1 280 550 | 199 538 | 153 177 | | Movement in reserves 1 April 2023 – 31 March 2024 | | | | | Profit after taxation | — | — | — | | Gains on realisation of debt instruments at FVOCI recycled through the income statement | — | — | — | | Fair value movements on cash flow hedges taken directly to other comprehensive income | — | — | — | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income | — | — | — | | Foreign currency adjustments on translating foreign operations | — | — | — | | Total comprehensive income for the year | — | — | — | | Share-based payments adjustments | — | — | — | | Employee benefit liability recognised | — | — | — | | Foreign currency gain on capital return from US subsidiary | — | — | — | | Issue of Additional Tier 1 security instruments | — | — | — | | Redemption of Additional Tier 1 security instruments | — | — | — | | Dividends paid to ordinary shareholder | — | — | — | | Dividends declared to Additional Tier 1 security holders | — | — | — | | Dividends paid to Additional Tier 1 security holders | — | — | — | | Gain on Additional Tier 1 security instruments callback | — | — | — | | Release of capital reserve to retained income | — | — | (141 649) | | At 31 March 2024 | 1 280 550 | 199 538 | 11 528 | | Movement in reserves 1 April 2024 – 31 March 2025 | | | | | Profit after taxation | — | — | — | | Gains on realisation of debt instruments at FVOCI recycled through the income statement | — | — | — | | Fair value movements on cash flow hedges taken directly to other comprehensive income | — | — | — | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income | — | — | — | | Foreign currency adjustments on translating foreign operations | — | — | — | | Total comprehensive income for the year | — | — | — | | Share-based payments adjustments | — | — | — | | Employee benefit liability recognised | — | — | — | | Redemption of Additional Tier 1 security instruments | — | — | — | | Dividends paid to ordinary shareholder | — | — | — | | Dividends declared to Additional Tier 1 security holders | — | — | — | | Dividends paid to Additional Tier 1 security holders | — | — | — | | Release of capital reserve to retained income | — | — | (11 528) | | At 31 March 2025 | 1 280 550 | 199 538 | — | 127 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | STATEMENT OF CHANGES IN EQUITY CONTINUED | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Other reserves | | | | | | | | | | | Fair value reserve | Cash flow hedge reserve | Foreign currency reserves | Retained income | | Shareholder’s equity excluding non- controlling interests | | Additional Tier 1 securities in issue | Total equity | | | | | | | | | | | | | | 2 101 | 27 635 | (4 832) | 436 898 | | 2 095 067 | | 250 000 | 2 345 067 | | | | | | | | | | | | | | — | — | — | 613 811 | | 613 811 | | — | 613 811 | | | (385) | — | — | — | | (385) | | — | (385) | | | — | (9 971) | — | — | | (9 971) | | — | (9 971) | | | 5 246 | — | — | — | | 5 246 | | — | 5 246 | | | — | — | (241) | — | | (241) | | — | (241) | | | 4 861 | (9 971) | (241) | 613 811 | | 608 460 | | — | 608 460 | | | — | — | — | 5 504 | | 5 504 | | — | 5 504 | | | — | — | — | 1 281 | | 1 281 | | — | 1 281 | | | — | — | — | 5 892 | | 5 892 | | — | 5 892 | | | — | — | — | — | | — | | 350 000 | 350 000 | | | — | — | — | — | | — | | (141 892) | (141 892) | | | — | — | — | (89 798) | | (89 798) | | — | (89 798) | | | — | — | — | (20 638) | | (20 638) | | 20 638 | — | | | — | — | — | — | | — | | (20 638) | (20 638) | | | — | — | — | 1 420 | | 1 420 | | — | 1 420 | | | — | — | — | 141 649 | | — | | | — | | | 6 962 | 17 664 | (5 073) | 1 096 019 | | 2 607 188 | | 458 108 | 3 065 296 | | | | | | | | | | | | | | — | — | — | 275 022 | | 275 022 | | — | 275 022 | | | (164) | — | — | — | | (164) | | — | (164) | | | — | (11 259) | — | — | | (11 259) | | — | (11 259) | | | (6 467) | — | — | — | | (6 467) | | — | (6 467) | | | — | — | (49) | — | | (49) | | — | (49) | | | (6 631) | (11 259) | (49) | 275 022 | | 257 083 | | — | 257 083 | | | — | — | — | (1 511) | | (1 511) | | — | (1 511) | | | — | — | — | 344 | | 344 | | — | 344 | | | — | — | — | — | | — | | (108 108) | (108 108) | | | — | — | — | (120 000) | | (120 000) | | — | (120 000) | | | — | — | — | (38 356) | | (38 356) | | 38 356 | — | | | — | — | — | — | | — | | (38 356) | (38 356) | | | — | — | — | 11 528 | | — | | — | — | | | 331 | 6 405 | (5 122) | 1 223 046 | | 2 704 748 | | 350 000 | 3 054 748 | | 128 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | #### Basis of presentation These Group and Company annual financial statements have been prepared in accordance with UK adopted international accounting standards and with International Financial Reporting Standards (IFRS® Accounting Standards/IFRS) as issued by the International Accounting Standards Board (IASB). The Group and Company annual financial statements have been prepared on historical cost basis, except for debt instruments at FVOCI, derivative financial instruments, financial assets and financial liabilities held at fair value through profit or loss or subject to hedge accounting. As stated on page [88](#i447e4d363cd344738300acdd42f0e3a0_241) , the directors consider that it is appropriate to continue to adopt the going concern basis in preparing the financial statements. The accounting policies adopted by the Group are consistent with the prior year and those standards and amendments that became effective in the current year had no material impact on the Group. #### Presentation of information Disclosure under IFRS 7 Financial Instruments: Disclosures and IAS 1 Presentation of Financial Statements: relating to the nature and extent of risks have been included in the notes to risk and capital management on pages [248](#i447e4d363cd344738300acdd42f0e3a0_484) to [293](#id4e335202ea2487094501d99658e2ab3_0-0-1-1-2494133) . Certain disclosures required under IAS 24 Related Party Disclosures have been included in the section marked as audited in the remuneration report on pages [96](#i447e4d363cd344738300acdd42f0e3a0_250) to [105](#ifa72657b73544d8db616102e7ba11496_35534) . #### Basis of consolidation All subsidiaries or structured entities are consolidated when the Group controls an investee. The Group controls an investee if it is exposed to, or has rights to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. The financial results of subsidiaries are included in the consolidated annual financial statements of the Group from the date on which control is obtained until the date the Group can no longer demonstrate control. The Group performs a reassessment of control whenever there is a change in the substance of the relationship between the Group and an investee. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities, non-controlling interests and other components of equity, while any resultant gain or loss is recognised in profit or loss. Any investment retained is recognised at fair value. Entities, other than subsidiary undertakings, in which the Group exercises significant influence or joint control over operating and financial policies, are treated as interests in associated undertakings and joint venture holdings. Interests in associated undertakings and joint venture holdings held with strategic intention, are accounted for using the equity method from the date that significant influence or joint control commences until the date that significant influence or joint control ceases. These are presented as Interests in associated undertakings and joint venture holdings on the balance sheet. In circumstances where interests in associated undertakings and joint venture holdings arise in which the Group has no strategic intention,  these investments are held for capital appreciation and/or investment income and are classified as ‘venture capital’ holdings and are elected as held at fair value through profit or loss. These are presented within investment portfolio on the balance sheet. For equity accounted associates and joint venture holdings, the consolidated annual financial statements include the attributable share of the results and reserves of associated undertakings and joint venture holdings. The Group’s interests in associated undertakings and joint venture holdings are included in the consolidated balance sheet at cost plus the post-acquisition changes in the Group’s share of the net assets of the associated undertakings and joint venture holdings. After application of the equity method, management evaluates if there is objective evidence that its net investment in the associate or joint venture is impaired and therefore that an impairment test is necessary. Because goodwill forms part of the carrying amount of the net investments in an associate or a joint venture, it is not separately recognised, therefore it is not tested for impairment separately. Instead, the entire carrying amount of the investment is tested for impairment in accordance with IAS 36 Impairment of Assets as a single asset, by comparing its recoverable amount (higher of value in use and fair value less costs of disposal) with its carrying amount. The consolidated balance sheet reflects the associated undertakings and joint venture holdings net of accumulated impairment losses. Investments in subsidiaries and interests in associated undertakings and joint venture holdings are carried at their cost less any accumulated impairment in the Company financial statements. All intergroup balances, transactions and unrealised gains or losses within the Group that do not reflect an impairment to an asset are eliminated in full regarding subsidiaries and to the extent of the interest in associated undertakings and joint venture holdings. 129 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | #### Segmental reporting An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s other components, where operating results are reviewed regularly by chief operating decision-makers who are considered to be executive members of the Board and for which discrete financial information is available. The Group’s segmental reporting is presented in the form of a business analysis. The business analysis is presented in terms of the Group’s three principal business divisions namely, Wealth & Investment, Private Banking and Corporate, Investment Banking and Other. For further detail on the Group's segmental basis, refer to the divisional review section. #### Business combinations and goodwill Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the consideration transferred, measured at the acquisition date fair value and the amount of any prior non-controlling interests in the acquiree. For each business combination, the Group measures the non-controlling interest in the acquiree either at fair value or at the proportionate share of the acquiree’s identifiable net assets. Acquisition costs incurred are expensed immediately in the income statement. When the Group acquires a business, it identifies all assets and liabilities of the business and recognises these at fair value at the time of the acquisition. It also assesses the financial assets and liabilities assumed for appropriate classification and the designation in accordance with the contractual terms, economic circumstances and pertinent conditions at the acquisition date. This includes the separation of embedded derivatives in host contracts by the acquiree. If the business combination is achieved in stages, the acquisition date fair value of the Group’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date through the income statement. Any contingent consideration to be transferred by the Group will be recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration, which is deemed to be an asset or liability, will be recognised in accordance with IFRS 9 at fair value through profit or loss. If the contingent consideration is classified as equity, it will not be remeasured until it is finally settled within equity. Goodwill is initially measured at cost, being the difference between the consideration transferred and the net identifiable assets acquired and liabilities assumed less the amount recognised for non-controlling interests. If this consideration is less than Investec’s share of the fair values of the identifiable net assets acquired, the discount on acquisition is recognised directly in the income statement as a gain in the year of acquisition. After initial recognition, goodwill is measured at cost less any accumulated impairment losses. The Group tests goodwill acquired in a business combination for impairment annually, irrespective of whether an indication of impairment exists and in accordance with IAS 36. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Group’s cash-generating units that are expected to benefit from the combination. Where goodwill forms part of a cash-generating unit, and part of the operation within that unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in these circumstances is measured based on the relative values of the operation disposed of and the portion of the cash-generating units retained. #### Discontinued operations A disposal group qualifies as a discontinued operation if it is a component of an entity that has either been disposed of or is classified as held for sale and represents a separate major line of business or geographical area of operations. Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss after tax from discontinued operations in the income statement. All other notes to the financial statements include amounts for continuing operations, unless indicated otherwise. Additional disclosures are provided in note 34. 130 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | #### Share-based payments to employees The Group engages in equity-settled share-based payments in respect of services received from employees. Share-based payments transactions will be settled with instruments of the Parent company, Investec plc. The obligation to provide shares to the employees is with the Parent company. For these equity-settled transactions a corresponding increase in equity, a ‘contribution from parent company’, is recognised over the period the service conditions of the grant are met. The Group is required to repay the parent company for the share-based payments provided. The repayment to the holding company will be accounted for as a ‘distribution to the parent company’. The fair value of the services received in respect of equity-settled share-based payments is determined by reference to the fair value of the shares or share options on the date of grant to the employee. The cost of the share-based payment is recognised in the income statement over the period the service conditions of the grant are met, with the amount changing according to the number of awards expected to vest, and a corresponding increase is recognised in equity. The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Group’s best estimate of the number of equity instruments that will ultimately vest. Fair value measurements are based on option pricing models, taking into account the risk-free interest rate, volatility of the underlying equity instrument, expected dividends and share prices at grant date. Where the terms of an equity-settled award are modified, the minimum expense recognised in staff costs is the expense as if the terms had not been modified. An additional expense is recognised for any modification which increases the total fair value of the share-based payment arrangement, or is otherwise beneficial to the employee as measured at the date of modification. #### Employee benefits Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the undiscounted amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably. The long-term employment benefits liability relates to the obligation of the Investec Group to deliver cash or other financial instruments to employees over a predetermined vesting period. The fair value of this liability is calculated by applying the Black- Scholes option pricing model at each reporting date. The changes in fair value will be recognised as an employee benefit expense. The liability is included in other liabilities on the balance sheet. The Group operates various defined contribution schemes. In respect of the defined contribution schemes, all employer contributions are charged to the income statement as incurred, in accordance with the rules of the scheme, and included under staff costs. #### Foreign currency transactions and foreign operations The presentation currency of the Group is Pound Sterling, being the functional currency of Investec Bank plc. Foreign operations are subsidiaries, interests in associated undertakings and joint venture holdings or branches of the Group, the activities of which are based in a functional currency other than that of the reporting entity. The functional currency of Group entities is determined based on the primary economic environment in which the entity operates. Foreign currency transactions are translated into the functional currency of the entity in which the transactions arise, based on rates of exchange ruling at the date of the transactions. At each balance sheet date foreign currency items are translated as follows: • Monetary items (other than monetary items that form part of the net investment in a foreign operation) are translated using closing rates, with gains or losses recognised in the income statement • Exchange differences arising on monetary items that form part of the net investment in a foreign operation are determined using closing rates and are initially recognised through other comprehensive income as a separate component of equity (foreign currency reserve) upon consolidation and are reclassified to the income statement upon disposal of the net investment • Non-monetary items that are measured at historical costs are translated using the exchange rates ruling at the date of the transaction. Non-monetary items that are measured at fair value are translated using the exchange rate at the date of the valuation, with movements due to changes in foreign currency being presented in terms of the accounting policy for changes in the fair value movement of the respective item. On consolidation, the results and financial position of foreign operations are translated into the presentation currency of the Group, as follows: • Assets and liabilities for each balance sheet presented are translated at the closing rate at the date of the balance sheet • Income and expense items are translated at exchange rates ruling at the date of the transaction • All resulting exchange differences are recognised in other comprehensive income (foreign currency translation reserve) • Cash flow items are translated at the exchange rates ruling at the date of the transactions. On loss of control or disposal of a foreign operation, the cumulative amount of the exchange differences relating to that foreign operation recognised in other comprehensive income is reclassified from equity to profit or loss. 131 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | #### Revenue recognition Revenue consists of interest income, fee and commission income, investment income, trading income arising from customer flow, trading income arising from balance sheet management and other trading activities, share of post-taxation profit of associates and joint venture holdings and other operating income. Interest income Interest income on debt instruments at amortised cost and FVOCI is recognised in the income statement using the effective interest method. Calculation of the effective interest rate takes into account fees payable or receivable that are an integral part of the instruments yield, premiums or discounts on acquisition or issue, early redemption fees and transaction costs. The effective interest method is based on the estimated life of the underlying instrument and, where this estimate is not readily available, the contractual life. Interest on instruments at fair value through profit or loss are recognised based on the contractual rates. Fee and commission income Fee and commission income includes revenue from contracts with customers earned from transactional banking fees, providing advisory services as well as portfolio management and includes rental income from investments (including properties and aircraft) and insurance income. Revenue from contracts with customers is recognised in accordance with five steps to: identify the contract; identify the performance obligations; determine the transaction price; allocate the transaction price to the performance obligations; and recognise revenue when the performance obligations are satisfied. Investment advisory and management fees are earned over the period in which the services are provided. Performance fees can be variable and recognition is constrained until such time as it is highly probable that a significant reversal in the amount of cumulative revenue recognised will not occur and the services related to the transactions have been completed under the terms of the contract. Investment income Investment income includes income, other than margin arising on securities held for the purpose of generating interest yield, dividends and capital appreciation. Dividend income is recognised when the Group’s right to receive payment is established. Trading income arises from customer flow and balance sheet management and other trading activities Customer flow trading income includes income from trading activities arising from making and facilitating client activities. Trading income arising from balance sheet management and other trading activities consists of proprietary trading income and other gains or losses arising from balance sheet management. Trading income includes the profit on trading portfolios, which are marked-to-market daily. Other sources of income Included in other operating income is incidental rental income, gains on realisation of properties, operating lease income, income from interests in associated undertakings and revenue from other investments. Operating costs associated with these investments are included in operating costs in the income statement. 132 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | #### Fair value measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or, in its absence, the most advantageous market to which the Group has access at that date. The fair value of an asset or a liability reflects its non-performance risk. When available, the Group measures the fair value of an instrument using the quoted price in an active market for that instrument. If there is no quoted price in an active market, then the Group uses valuation techniques that maximise the use of relevant observable inputs and minimise the use of unobservable inputs. The chosen valuation technique incorporates all of the factors that market participants would take into account in pricing a transaction. If an asset or a liability measured at fair value has a bid price and an ask price, then the Group measures assets and long positions at a bid price and liabilities and short positions at an ask price. The Group classifies disclosed fair values according to a hierarchy that reflects the significance of observable market inputs. A transfer is made between the hierarchy levels when the inputs have changed or there has been a change in the valuation method. Transfers are deemed to occur at the end of each semi-annual reporting period. #### Financial instruments Financial instruments are initially recognised at their fair value. For financial assets or financial liabilities not held at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial assets or financial liabilities are included in the initial measurement. All other transaction costs are recorded in the income statement immediately. Regular way purchase and sales transactions in respect of financial assets that require delivery of a financial instrument within the time frame established by market convention are recorded at trade date. Financial assets are classified as at fair value through profit or loss (FVPL) if they are equity instruments or derivative instruments, while debt instruments are classified based on the business model and characteristics of related cash flows. Financial liabilities are classified as at amortised cost other than trading liabilities and derivative instruments, which are classified as at FVPL. However, the Group may make the following irrevocable election/designation at initial recognition of a financial asset on an asset- by-asset basis: • Elect to present subsequent changes in fair value of an equity investment that is neither held for trading nor contingent consideration recognised by an acquirer in a business combination to which IFRS 3 applies, in OCI • A debt instrument that meets the amortised cost or FVOCI criteria as measured at FVPL if doing so eliminates or significantly reduces an accounting mismatch (referred to as the fair value option) • Financial liabilities may also be designated as at FVPL when doing so results in more relevant information, because either it eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise from measuring assets or liabilities or recognising the gains and losses on them on different bases; or a group of financial liabilities or financial assets and financial liabilities is managed and its performance is evaluated on a fair value basis. In addition, where a financial liability contract contains one or more embedded derivatives (which significantly modifies the cash flows that would be required by the contract and is not clearly prohibited from separation from the host contract), the Group may designate the entire hybrid contract as a financial instrument at FVPL . Business model assessment For financial assets, IFRS 9 requires that a business model assessment is carried out which reflects how the Group manages the assets in order to generate cash flows. The assessment is at a portfolio level, being the level at which a group of investments is managed. Factors considered by the Group in determining the business model for a portfolio include past experience on how the cash flows for these assets were collected, how the assets’ performance is evaluated and reported and how risks are assessed and managed. The standard sets out different types of business models: • Hold to collect: it is intended to hold the asset to maturity to earn interest, collecting repayments of principal and interest from the customer. These assets are accounted for at amortised cost ▪ Hold to collect and sell: this model is similar to the hold to collect model, except that the entity may elect to sell some or all of the assets before maturity to achieve the objectives of the business model. These assets are accounted for at FVOCI ▪ Hold to sell/managed on a fair value basis: the entity originates or purchases an asset with the intention of disposing of it in the short or medium term to benefit from capital appreciation or the portfolio is managed on a fair value basis. These assets are accounted for at FVPL. 133 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | Solely payments of principal and interest (SPPI) The Group assesses whether the asset’s cash flows represent solely payments of principal and interest (the SPPI test). In making this assessment, the Group considers whether the contractual cash flows are consistent with a basic lending arrangement (i.e. interest includes only consideration for the time value of money, credit risk, other basic lending risks and a profit margin that is consistent with a basic lending arrangement). Where the contractual terms introduce exposure to risk or volatility that are inconsistent with a basic lending arrangement, the related asset is classified and measured at FVPL. Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payments of principal and interest. Financial instruments measured at amortised cost Financial assets that are debt instruments are held to collect the contractual cash flows and that contain contractual terms that give rise to cash flows that are solely payments of principal and interest, such as most loans and advances to banks and customers and some debt securities, are measured at amortised cost. In addition, most financial liabilities are measured at amortised cost. The Group may commit to provide a loan which has not yet been drawn. When the loan that arises from the lending commitment is expected to meet the criteria to be measured at amortised cost, the undrawn commitment is also considered to be and is included in the impairment calculation. The carrying value of these financial assets at initial recognition includes any directly attributable transaction costs. If the initial fair value is lower than the cash amount advanced, such as in the case of some leveraged finance and syndicated lending activities, the difference is deferred and recognised over the life of the loan through the recognition of interest income, unless the loan is credit impaired. Financial assets measured at fair value through other comprehensive income (FVOCI) Financial assets held for a business model that is achieved by both collecting contractual cash flows and selling and that contain contractual terms that give rise on specified dates to cash flows that are solely payments of principal and interest are measured at FVOCI. They are recognised on the trade date when the Group enters into contractual arrangements to purchase and are normally derecognised when they are either sold or redeemed. They are subsequently remeasured at fair value and changes therein (except for those relating to impairment, interest income and foreign currency exchange gains and losses) are recognised in other comprehensive income until the assets are sold. Upon disposal, the cumulative gains or losses in other comprehensive income are recognised in the income statement in investment income. Financial assets measured at FVOCI are included in the impairment calculations set out below and impairment is recognised in profit or loss. The Group measures equity instruments at FVOCI when it considers the investments to be strategic or held for long-term dividend yield. The equity instruments are not held for trading. Gains and losses on financial assets that are equity instruments are never recycled to the income statement. Dividends are recognised in the income statement within investment income when the right of the payment has been established. Equity instruments at FVOCI are not subject to an impairment assessment. Impairment of financial assets held at amortised cost or FVOCI At each balance sheet date, each financial asset or portfolio of advances categorised at amortised cost or at FVOCI, issued financial guarantee and loan commitment is measured for ECL impairment. The costs of loss allowances on assets held at amortised cost and at FVOCI are presented as ‘expected credit loss impairment (charges)/release’ in the income statement.  Allowances in respect of financial guarantees and loan commitments are presented as other liabilities and charges recorded within the same line the income statement. Financial assets held at amortised cost are presented net of allowances, except where the asset has been wholly or partially written off. Stage 1 Financial assets that are considered performing and have not had a significant increase in credit risk are reported as Stage 1 assets. Stage 1 financial assets have loss allowances measured at an amount equal to a 12-month ECL. Stage 2 Financial assets are considered to be in Stage 2 when their credit risk has increased significantly since initial recognition. A loss allowance equivalent to a lifetime ECL is required to be held. The Group’s primary indicator for Stage 2 assets are distressed loans, potential problem loans and exposures in arrears that require additional attention and supervision from watchlist committees and are under management review. Assets in forbearance are considered to be, at a minimum, Stage 2. Forbearance measures refer to concessions such as modification of the terms and conditions or refinancing that has been granted to a debtor in financial difficulty. These exposures are assessed on a case-by-case basis to determine whether the proposed modifications will be considered as forbearance. Where the Credit Committee considers it likely that the client will be able to return to perform against the original contractual obligations within a reasonable time frame these assets will be considered performing and in Stage 2. Forbearance is distinguished from commercial renegotiations which take place as part of normal business activity and standard banking practice. 134 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | In addition to loans under management review, an asset may also move from Stage 1 to Stage 2 if the model calculated probability of default (PD) has significantly increased since origination. This is tested on both a relative and absolute basis to assess whether a significant deterioration in lifetime risk of default has occurred. There is a common definition across the Bank’s exposures regarding what constitutes a significant PD movement. The test involves both an absolute and relative movement threshold. An asset is considered to have been subjected to a significant increase in credit risk if the appropriate PD has doubled relative to the value at origination and on an absolute basis has increased by more than 1%. Any asset with an original rating that is classified as investment grade will be judged to have had a significant movement if the new PD would classify it as sub-investment grade and the equivalent rating has moved by more than three notches. The Group adopts the view that all financial assets that are more than 30 days past due have experienced a significant increase in credit risk. Exposures move back to Stage 1 once they no longer meet the criteria above for a significant increase in credit risk and as cure periods (specifically relating to forborne exposures) are met. Stage 3 Financial assets are included in Stage 3 when there is objective evidence of credit impairment. The Group assesses a loan as Stage 3 when contractual payments of either principal or interest are past due for more than 90 days, the debtor is assessed as unlikely to pay and credit impaired, or the loan is otherwise considered to be in default, for example, due to the appointment of an administrator or the client is in receivership. Forborne loans that are considered non-performing, for example, if a loan is not expected to meet the original contractual obligations in a reasonable time frame, will be classified as Stage 3. Loans which are  90 days or more past due are considered to be in default. The Group applied the effective interest rate on Stage 3 assets to the amortised cost of the financial asset (i.e. gross carrying amount less ECL allowance) instead of its gross carrying amount and incorporates the impact of the ECLs in estimated future cash flows. Definition of default The Group has aligned the IFRS 9 and regulatory definitions of default, credit impaired and non-performing exposure. Assets that are more than 90 days past due, or considered by management as unlikely to pay their obligations in full without realisation of collateral are considered as exposures in default. ECL The assessment of credit risk and the estimation of ECL are required to be unbiased, probability-weighted and should incorporate all available information relevant to the assessment, including information about past events, current conditions and reasonable and supportable forecasts of economic conditions at the reporting date. In addition, the estimation of ECL should take into account the time value of money. As a result, the recognition and measurement of impairment is intended to be forward‑looking and therefore, potentially volatile. Write-offs The Group has developed specific guidelines on write-off aimed at granting full compliance with IFRS 9 and the document 'Guidance to banks on non-performing loans' issued by the European Central Bank. A loan or advance is written off in full against the related ECL impairment allowance when the entity has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. This is assessed on a case-by-case basis with considerations to indicators such as whether the exposure has been restructured or the given financial position of the borrower and guarantors. Any recoveries of amounts previously written off decrease the amount of impairment losses. Cured assets Loans and advances are regularly assessed to determine whether conditions which led to a significant increase in credit risk or impairment still exist. Where applicable, the cured asset will move to the appropriate performing stage which reflects the re- assessed credit risk in line with our Arrears, default and recovery (ADR) policy which is aligned to the applicable Regulatory requirements. Process to determine ECL ECLs are calculated using three main components: • A probability of default (PD) • A loss given default (LGD) • The exposure at default (EAD). The 12-month and lifetime PDs represent the probability of a default occurring over the next 12 months or the lifetime of the financial exposures, respectively, based on conditions existing at the balance sheet date and future forecast macro-economic conditions that affect credit risk. The LGD represents losses expected on default, taking into account the mitigating effect of collateral and guarantees that are integral to the instrument, the expected value when realised and the time value of money. The forecast value for the collateral is also affected by the range of forward-looking probability-weighted macro-economic scenarios. 135 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | The EAD represents the expected balance at default, taking into account the repayment of principal and interest from the balance sheet date to the default event together with any expected drawdown of a committed facility. The calculation of the 12-month ECL is based on the 12-month PD and LGD along with the EAD and EIR for the asset. Lifetime ECL is calculated using the lifetime PD curve, and the appropriate LGDs and EADs, and discount rates using the EIR for the remaining life of the financial asset. Expert judgement models or appropriate proxies for PD’s are also utilised for certain portfolios where the ECL is found to be minimal, either due to the portfolio’s small relative size or the low default nature of these portfolios, such as cash and balances held at central banks. Management adjustments are made to modelled output to account for situations where additional information and known or expected risk factors have not been captured in the modelling process. Financial instruments held at fair value through profit or loss (FVPL) Financial instruments held at fair value through profit or loss include all instruments classified as held for trading, those instruments designated as held at fair value through profit or loss, those financial assets which do not meet the criteria for amortised cost or FVOCI and derivative financial instruments. Financial instruments classified as FVPL are initially recorded at fair value on the balance sheet with changes in fair value subsequently recognised in the income statement. Financial instruments are classified as held for trading when they are held with the intention of short-term disposal, held with the intention of generating short-term profit, or are derivatives which are not designated as part of effective hedges. Financial instruments designated as held at fair value through profit or loss are designated as such on initial recognition of the instrument and remain in this classification until derecognition. Changes in own credit risk on financial liabilities designated at fair value are recognised in other comprehensive income. Any other changes are recognised in the income statement. Securitisation/credit investment and trading activities exposures The Group makes use of securitisation vehicles as a source of finance, as a means of risk transfer and to leverage returns through the retention of equity tranches in low default rate portfolios. The Group predominantly focuses on the securitisation of residential and commercial mortgages and lease receivables. The Group also trades in structured credit investments. The structured entities are consolidated under IFRS 10 Consolidated Financial Statements when the Group has exposure to or rights to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Loans and advances that are originated are transferred to structured entities, and the structured entities issue debt securities to external investors to fund the purchase of the securitised assets. When the Group consolidates the structured entity, the Group recognises the assets and liabilities on a gross basis. When the Group does not consolidate the structured entity, the securitised assets are derecognised and only any position still held by the Group in the structured entity is reflected. Day-one profit or loss When the transaction price differs from the fair value of other observable current market transactions in the same instrument or based on the valuation technique whose variables include only data from observable markets, the difference between the transaction price and fair value is recognised immediately in the income statement. In cases where fair value is determined using data which is not observable, the difference between the transaction price and model value is only recognised in the income statement when the inputs become observable, when the instrument is derecognised or over the life of the transaction only to the extent that it arises from a change in a factor (including time) that market participants would take into account when pricing the asset or liability. Derecognition of financial assets and liabilities A financial asset, or a portion thereof, is derecognised when the Group’s rights to cash flows have expired or when the Group has transferred its rights to cash flows relating to the financial assets and either (a) the Group has transferred substantially all the risks and rewards associated with the financial assets or (b) the Group has neither transferred nor retained substantially all the risks and rewards associated with the financial assets but has transferred control of the assets. When the Group has neither transferred nor retained substantially all the risks and rewards and has retained control of the asset, the asset continues to be recognised only to the extent of the Group’s continuing involvement, in which case, the Group also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group has retained. The treatment of a renegotiation or modification of the contractual cash flows of a financial asset depends upon whether the modification is considered significant. If they are significant the old asset is derecognised and a new asset recognised. A financial liability is derecognised when it is extinguished, that is when the obligation is discharged, cancelled or expired. When an existing financial liability is replaced or modified with substantially different terms, such a replacement or modification is treated as a derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the income statement. 136 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | Reclassification of financial instruments Financial assets are only reclassified where there has been a change in business model. Certain financial liabilities can be reclassified to equity. Derivative instruments All derivative instruments of the Group are recorded on the balance sheet at fair value. Positive and negative fair values are reported as assets and liabilities, respectively. Derivative positions are entered into either for trading purposes or as part of the Group’s asset and liability management activities to manage exposures to interest rate and foreign currency risks. Both realised and unrealised profit or losses arising on derivatives are recognised in the income statement as part of trading income (other than circumstances in which cash flow hedging is applied as detailed in the hedge accounting section below). Credit derivatives are entered into for trading purposes. Credit derivatives are initially recognised at their fair values, being the transaction price of the derivative. Subsequently the derivatives are carried at fair value, with movements in fair value through the income statement, based on the current market price or remeasured price. The counterparty risk from derivative transactions is taken into account when reporting the fair value of derivative positions. The adjustment to the fair value is known as the credit value adjustment (CVA). Hedge accounting When the Group first implemented IFRS 9, it made an election to continue to apply the hedge accounting requirements of IAS 39 as an accounting policy. The Group applies either fair value or cash flow hedge or hedge accounting of net investments in foreign operations accounting when the transactions meet the specified hedge accounting criteria. To qualify for hedge accounting treatment, the Group ensures that all of the following conditions are met: • At inception of the hedge, the Group formally documents the relationship between the hedging instrument(s) and hedged item(s) including the risk management objectives and the strategy in undertaking the hedge transaction. Also at the inception of the hedge relationship, a formal assessment is undertaken to ensure the hedging instrument is expected to be highly effective in offsetting the designated risk in the hedged item. A hedge is expected to be highly effective if the changes in fair value or cash flows attributable to the hedged risk during the period for which the hedge is designated are expected to offset in a range of 80% to 125% • For cash flow hedges, a forecasted transaction that is the subject of the hedge must be highly probable and must present an exposure to variations in cash flows that could ultimately affect the income statement ▪ The effectiveness of the hedge can be reliably measured, i.e. the fair value or cash flows of the hedged item that are attributable to the hedged risk and the fair value of the hedging instrument can be reliably measured ▪ The hedge effectiveness is assessed on an ongoing basis and determined actually to have been highly effective throughout the financial reporting periods for which the hedge was designated. For qualifying fair value hedges, the change in fair value of the hedging instrument is recognised in the income statement. Changes in fair value of the hedged item that are attributable to the hedged risk are also recognised in the income statement. For qualifying cash flow hedges in respect of non-financial assets and liabilities, the change in fair value of the hedging instrument relating to the effective portion is initially recognised directly in other comprehensive income in the cash flow hedge reserve and is included in the initial cost of any asset/liability recognised or in all other cases released to the income statement when the hedged firm commitment or forecasted transaction affects net profit. If the forecast transaction or firm commitment is no longer expected to occur, the balance included in other comprehensive income is reclassified to the income statement immediately and recognised in trading income from balance sheet management and other trading activities. For qualifying cash flow hedges in respect of financial assets and liabilities, the change in fair value of the hedging instrument, which represents an effective hedge, is initially recognised in other comprehensive income and is reclassified to the income statement in the same period during which the relevant financial asset or liability affects the income statement. Any ineffective portion of the hedge is immediately recognised in the income statement. For qualifying hedges of a net investment in a foreign operation, including a hedge of a monetary item that is accounted for as part of the net investment, changes in the fair value of the hedging instrument relating to the effective portion of the hedge are recognised in other comprehensive income while any gains or losses relating to the ineffective portion are recognised in the income statement. On disposal of the foreign operation, the cumulative value of any such gain or loss recorded in other comprehensive income is reclassified to the income statement. Hedge accounting is discontinued when it is determined that the instrument ceases to be highly effective as a hedge; when the derivative expires, or is sold, terminated or exercised; when the hedged item matures or is sold or repaid; when a forecasted transaction is no longer deemed highly probable or when the designation as a hedge is revoked. Sources of hedge ineffectiveness may arise from basis risk, including but not limited to the discount rates used for calculating the fair value of derivatives, hedges using instruments with a non-nil fair value at the date of recognition, and notional and timing differences between the zero hedged items and hedging instruments. 137 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | Offsetting of financial assets and liabilities Financial assets and liabilities are offset when there is both an intention to settle on a net basis (or simultaneously) and a currently enforceable legal right to offset exists. Issued debt and equity financial instruments Financial instruments issued by the Group are classified as liabilities if they contain a contractual obligation to deliver cash or another financial asset. Financial instruments issued by the Group are classified as equity where they confer on the holder a residual interest in the Group, and the Group has no obligation to deliver either cash or another financial asset to the holder. The components of compound issued financial instruments are accounted for separately with the liability component separated first and any residual amount being allocated to the equity component. Equity instruments issued by subsidiaries of Investec Bank plc are recorded as non-controlling interests on the balance sheet. Equity instruments are initially measured net of directly attributable issue costs. Dividends on ordinary shares are recognised as a deduction from equity at the earlier of payment date or the date that it is approved by Investec Bank plc shareholders. #### Sale and repurchase agreements (including securities borrowing and lending) Securities sold subject to a commitment to repurchase, at a fixed price or a selling price plus a lender’s return, remain on-balance sheet. Proceeds received are recorded as a liability on the balance sheet under ‘repurchase agreements and cash collateral on securities lent’. Securities that are purchased under a commitment to resell the securities at a future date are not recognised on the balance sheet. The consideration paid is recognised as an asset under ‘reverse repurchase agreements and cash collateral on securities borrowed’. Where sovereign debt securities have been purchased at the same time as derivatives with the same counterparty, such that the combined position has the economic substance similar to secured lending, an asset is recognised under ‘reverse repurchase agreements and cash collateral on securities borrowed’. The difference between the sale and repurchase prices is treated as interest expense and is accrued over the life of the agreement using the effective interest method. Securities borrowing transactions that are not cash collateralised are not included on the balance sheet. Securities lending and borrowing transactions which are cash collateralised are accounted for in the same manner as securities sold or purchased subject to repurchase commitments. #### Financial guarantees Financial guarantee contracts issued by the Group are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due, in accordance with the terms of a debt instrument. Financial guarantees issued by the Group are not classified as insurance contracts and are initially recognised at fair value. Subsequent to initial recognition, the liability under each guarantee is measured at the higher of the amount recognised less cumulative amount of income recognised in accordance with IFRS 15 and the best estimate of expected credit loss calculated for the financial guarantee. Subsequent to initial measurement, all changes in the balance sheet carrying value are recognised in the income statement. 138 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | #### Property and equipment Property and equipment are recorded at cost less accumulated depreciation and impairments. Cost is the cash equivalent paid or the fair value of the consideration given to acquire an asset and includes other expenditures that are directly attributable to the acquisition of the asset. Depreciation is provided on the depreciable amount of each component on a straight-line basis over the expected useful life of the asset. The depreciable amount related to each asset is determined as the difference between the cost and the residual value of the asset. The residual value is the estimated amount, net of disposal costs that the Group would currently obtain from the disposal of an asset in similar age and condition as expected at the end of its useful life. The current and comparative annual depreciation rates for each class of property and equipment are as follows: • Computer and related equipment20% to 33% • Motor vehicles20% to 25% • Furniture and fittings10% to 20% • Freehold buildings2% • Right-of-use assets\* • Leasehold property and improvements\* \*Leasehold improvements depreciation rates are determined by reference to the appropriate useful life of its separate components, limited to the period of the lease. Leasehold property and right-of-use asset depreciation rates are determined by reference to the period of the lease. Routine maintenance and service costs for Group assets are expensed as incurred. Subsequent expenditure is only capitalised if it is probable that future economic benefits associated with the item will flow to the Group. Property and equipment are derecognised on disposal or when no future economic benefits are expected to be realised. #### Leases At inception of a contract the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Group assesses whether: • The Group has the right to obtain substantially all of the economic benefits from use of the asset throughout the period of use • The Group has the right to direct the use of the asset. As a lessee, the Group recognises a right-of-use (ROU) asset and a lease liability at the lease commencement date. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted at the rate implicit in the lease, or, where that is not available, at the Group’s incremental borrowing rate. The lease liability will increase for the accrual of interest, and will result in a constant rate of return throughout the life of the lease, and reduce when payments are made. The ROU asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any indirect costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The ROU asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term. In addition, the ROU asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability. The lease liability is subsequently remeasured when there is a change in future lease payments arising from a change in index or rate, if there is a change in the Group’s estimate of the amount expected to be payable under a residual value guarantee, or if the Group changes its assessment of whether it will exercise a purchase, extension or termination option. Where the lease liability is remeasured, a corresponding adjustment is made to the carrying amount of the ROU asset, or is recorded in the income statement if the carrying amount of the ROU asset has been reduced to zero. The Group has elected not to recognise ROU assets and lease liabilities for low value assets and short-term leases that have a lease term of 12 months or less. The Group recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term. When the Group is the lessor, the lease must be classified as either a finance lease or an operating lease. A finance lease is a lease which confers substantially all the risks and rewards of the leased assets on the lessee. An operating lease is a lease where substantially all of the risks and rewards of the leased asset remain with the lessor. When the lease is deemed a finance lease, the leased asset is not held on the balance sheet; instead a finance lease receivable is recognised representing the minimum lease payments receivable under the terms of the lease, discounted at the rate of interest implicit in the lease. 139 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | When the lease is deemed an operating lease, the lease income is recognised on a straight-line basis over the period of the lease unless another systematic basis is more appropriate. On the balance sheet, the ROU assets are included within property and equipment unless the asset is held for investment purposes, in which case the nature of the investment will determine the presentation. Finance lease receivables are ordinarily included within loans and advances to customers but are included in other assets where the Group holds a head lease and the sublease arrangement with external parties is a finance lease. Lease liabilities are included within other liabilities. Where the Group has a head lease and sublease arrangement with external partners, the finance lease receivable is recognised in other assets on the balance sheet. #### Trading properties Trading properties are carried at the lower of cost and net realisable value. #### Software and intangible assets Software and intangible assets are recorded at cost less accumulated amortisation and impairments. Software and intangible assets with a finite life are amortised over the useful economic life on a straight-line basis. Amortisation of each asset starts when it becomes available for use. The depreciable amount related to each asset is determined as the difference between the cost and the residual value of the asset. The current and comparative annual amortisation rates for each class of intangible assets are as follows: • Client relationships12 to 20 years • Acquired software3 to 7 years • Internally generated software5 years #### Impairment of non-financial assets At each balance sheet date, the Group reviews the carrying value of non-financial assets, other than investment property, for indication of impairment. The recoverable amount, being the higher of fair value less cost of disposal and value-in-use, is determined for any assets for which an indication of impairment is identified, and in the case of cash generating units containing goodwill, annually. If the recoverable amount of an asset is less than its carrying value, the carrying value of the asset is reduced to its recoverable amount. Impairment losses are recognised as an expense in the income statement in the period in which they are identified. Reversals of impairment losses are recognised in income in the period in which the reversals are identified, to the extent that the carrying value of the asset does not exceed the amount that would have been calculated without impairment. #### Trust and fiduciary activities The Group acts as a trustee or in other fiduciary capacities that result in the holding, placing or managing of assets for the account of and at the risk of clients. As these are not assets of the Group, they are not recognised on the balance sheet but are included at market value as part of third party assets under management. #### Taxation and deferred taxation Current taxation payable is provided for based on the amount expected to be payable on taxable profit at rates that are enacted or substantively enacted and applicable to the relevant period. Deferred taxation is provided on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base, except where such temporary differences arise from: • The initial recognition of goodwill • The initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction has no effect on the income statement or taxable profit • Temporary differences associated with the investments in subsidiaries and interests in associated undertakings and joint venture holdings, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future. Deferred taxation assets or liabilities are measured using the taxation rates that have been enacted or substantively enacted at the balance sheet date. Deferred taxation assets are recognised to the extent that it is probable that future taxable profit will be available against which the deferred taxation assets can be utilised. Items recognised directly in other comprehensive income are net of related current and deferred taxation. 140 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | #### Borrowing costs Borrowing costs that are directly attributable to property developments which take a substantial period of time to develop are capitalised to qualifying properties. #### Provisions, contingent liabilities and contingent assets Provisions are recognised when the Group has a present legal or constructive obligation as a result of a past event; it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. The expense relating to a provision is presented in the income statement net of any reimbursement. Contingent assets and contingent liabilities are not recognised on the balance sheet. #### Standards and interpretations issued but no #### t yet effective The following significant standards and interpretations, which have been issued but are not yet effective, are applicable to the Group. These standards and interpretations have not been applied in these annual financial statements. The Group intends to comply with these standards from the effective dates. IFRS 18 Presentation and Disclosure in Financial Statements IFRS 18 introduces new requirements on presentation within the statement of profit or loss, including specified totals and subtotals. It also requires disclosure of management-defined performance measures and includes new requirements for aggregation and disaggregation of financial information based on the identified 'roles' of the primary financial statements (PFS) and the notes. These new requirements are expected to impact all reporting entities. IFRS 18 and the consequential amendments to other standards is effective for reporting periods beginning on or after 1 January 2027 and the Group is considering its impact. Amendments to IFRS 9 Amendments to Classification and Measurement of Financial Instruments and IFRS 7 disclosures The amendments clarify that a financial liability is derecognised on the 'settlement date' and introduce an accounting policy choice to derecognise financial liabilities settled using an electronic payment system before the settlement date. The classification of financial assets with ESG linked features has been clarified via additional guidance on the assessment of contingent features. Clarifications have been made on non-recourse loans and contractually linked instruments. Additional disclosures are introduced for financial instruments with contingent features and equity instruments classified at fair value through OCl. The amendments are effective for annual periods starting on or after 1 January 2026 and the Group is considering the impact. All other standards and interpretations issued but not yet effective are not expected to have a material impact on the Group. 141 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | #### Key management assumptions In preparation of the annual financial statements, the Group makes estimations and applies judgement that could affect the reported amount of assets and liabilities within the next financial year. Key areas in which estimates are made include: • In accordance with IFRS 13 Fair Value Measurement, the Group categorises financial instruments carried on the balance sheet at fair value using a three level hierarchy. Financial instruments categorised as level 1 are valued using quoted market prices and therefore there is minimal judgement applied in determining fair value. However, the fair value of financial instruments categorised as level 2 and, in particular, level 3 are determined using valuation techniques including discounted cash flow analysis, price-earnings multiples, net asset value and complex valuation models. The valuation techniques for level 3 financial instruments involve management judgement and estimates, the extent of which, depends on the complexity of the instrument, counterparty and own credit risk, funding cost, low levels of market liquidity, and the availability of market observable information. In particular, significant uncertainty exists in the valuation of unlisted investments and fair value loans in the private equity and direct investments portfolios. The estimation of fair value is subject to an uncertain economic outlook. Key valuation inputs are based on the most relevant observable market information and can include expected cash flows, yield curves, discount rates, growth rates, earnings multiples and the underlying assets and liabilities within a business, adjusted where necessary for factors that specifically apply to the individual investments, sector specific factors and recognising market volatility and liquidity. Further details of the Group’s level 3 financial instruments, valuation techniques, key valuation inputs applied and the sensitivity of the valuation including the effect of applying reasonably possible alternative assumptions in determining their fair value are set out in note 14. Details of unlisted investments can be found in note 25 with further analysis contained in the notes to risk and capital management on page [272](#i447e4d363cd344738300acdd42f0e3a0_508). • The measurement of ECL has reliance on expert credit judgement. Key judgemental areas are highlighted below and are subject to robust governance processes. Key drivers of measurement uncertainty include: – The assessment of staging due to a significant increase in credit risk – Adequacy of post model adjustments – Assessment of ECL on Stage 3 exposures, including the valuation of collateral, expected timing of cash flows, client industry considerations and recovery strategies – The determination of write-off points – A range of forward-looking probability weighted macro-economic scenarios – Estimations of probabilities of default, loss given default and exposures at default using models. Following a detailed review of the outcome of the ECL models, management continue to hold an additional overlay provision in the UK of £3.7 million (31 March 2024: £3.7 million). Detail of the approach followed and management’s assumptions are set out on page [266](#i447e4d363cd344738300acdd42f0e3a0_499) of section 3. ▪ The Group’s income tax charge and balance sheet provision are judgemental in nature. This arises from certain transactions for which the ultimate tax treatment can only be determined by final resolution with the relevant local tax authorities. The Group has recognised in its current tax provision certain amounts in respect of taxation that involve a degree of estimation and uncertainty where the tax treatment cannot finally be determined until a resolution has been reached by the relevant tax authority and whether the proposed tax treatment will be accepted by the authorities. The carrying amount of this provision is sensitive to the resolution of issues, which is often dependent on the timetable and progress of discussion and negotiations with the relevant tax authorities, arbitration process and legal proceedings in the relevant tax jurisdictions in which the Group operates. Issues can take many years to resolve and assumptions on the likely outcome would therefore have to be made by the Group in order to determine if an exposure should be measured based on the most likely amount or expected value. In making any estimates, management’s judgement has been based on various factors, including: • The current status of tax audits and enquiries • The current status of discussions and negotiations with the relevant tax authorities • The results of any previous claims • Any changes to the relevant tax environments. • The Group operates in a legal and regulatory environment that exposes it to litigation risks. As a result, the Group is involved in disputes and legal proceedings which arise in the ordinary course of business. The Group evaluates all facts, the probability of the outcome of legal proceedings, commercial outcomes and advice from internal and external legal counsel when considering the accounting implications as set out in note 47. • The Group makes use of reasonable and supportable information to make accounting judgements and estimates related to climate change. This includes information about the observable impact of climate change on the current credit risk of clients and the valuation of assets. Many of the effects arising from climate change will be longer term in nature, with an inherent level of uncertainty and have limited effect on accounting judgements and estimates for the current period. The following items represent the most significant effects that climate change can have on the shorter term: 142 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ACCOUNTING POLICIES CONTINUED | | | | | | – The measurement of ECL considers the ability of borrowers to make contractual payments as and when they become due. Investec performed an assessment of specific sectors that could be most impacted by climate risk in all jurisdictions, specifically focusing on the ability of the clients in these sectors to meet their financing needs. The assessment further included a review of Investec’s appetite to fund clients in the respective sectors. While these have not resulted in material impact to ECL, the determination of the impact of these risks into PD, LGD and other inputs into the ECL calculation is ongoing – The assessment of asset impairment, based on value in use, and the ability to recognise deferred tax assets are based on future expected cash flows. The expected cash flows are based on management’s best estimate of the operational results, including the near-term impact of climate risk. The Group did not consider any additional adjustments to the cash flows to account for this risk given the time frame of the cash flows that were considered – The use of market indicators as inputs to fair value is assumed to include current information and knowledge regarding the effect of climate risk. Key areas in which judgement is applied include: • In accordance with IFRS 10 Consolidated Financial statements, the Group controls and consolidates an investee where the Group has power over the entity’s relevant activities, is exposed to variable returns from its involvement with the investee and has the ability to affect the returns through its power over the entity. Determining whether the Group controls another entity requires judgement by identifying an entity’s relevant activities, being those activities that significantly affect the investee’s returns, and whether the Group controls those relevant activities by considering the rights attached to both current and potential voting rights, de facto control and other contractual rights including whether such rights are substantive. In the current period, a change in rights in respect of Investec Capital Services (India) Pvt Ltd (ICSI) occurred and, when evaluated against these criteria, the revised rights, which included options over the shares we do not currently hold, were concluded to be protective in nature. As such ICSI was determined to be a joint venture associate. Details of subsidiaries can be found in note 58. • On the basis of current financial projections and having made appropriate enquiries, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence up to 19 June 2026, which is a period of twelve months from the date of issue of the financial statements that aligns with internal budgeting processes. Accordingly, the going concern basis is adopted in the preparation of the financial statements. 143 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS | | | | | | 1. #### Segmental business analysis – income statement Wealth & Investment Wealth & Investment includes our 41.25% equity accounted earnings of the combined Rathbones Group, and IBSAG which houses our Swiss wealth business. Private Banking Our Private Banking business in the UK comprises lending (primarily residential mortgages), savings and transactional banking (including international payments) to HNW clients, coupled with bespoke foreign exchange and financing solutions for qualifying HNW clients. Corporate, Investment Banking and Other Our Corporate and Investment Banking businesses in comprises business activities that provide lending, advisory and risk management services to growth-orientated corporate clients in the private companies, private equity and listed companies arenas, including specialist sector-focused expertise. This segment also includes our central treasury and liability management channels. Adjusted operating profit Management’s measure of operating profit, ‘adjusted operating profit’, is calculated based on pro-forma profit before taxation, adjusted to remove goodwill, acquired intangibles and strategic actions, including such items within equity accounted earnings, and non-controlling interests. | | | | | --- | --- | --- | | | | | | For the year to 31 March | 2025 | 2024 | | £’000 | | Profit before taxation from continuing operations | 446 848 | 421 742 | | Amortisation of acquired intangibles | — | 940 | | Closure and rundown of the Hong Kong direct investments business | (319) | 784 | | Financial impact of strategic actions\* | 16 007 | — | | Adjustments related to equity accounted earnings | 34 299 | 58 110 | | Profit before amortisation and integration costs (pro-forma adjustment) | — | 35 855 | | Amortisation of acquired intangibles | 6 312 | 12 624 | | Acquisition related and integration costs of associate | 27 987 | 9 631 | | Less: profit attributable to non-controlling interests | (12) | (1 204) | | Adjusted operating profit for continuing operations | 496 823 | 480 372 | \*Included within this line in the current year are movements in value on deferred considerations on various transactions, continuing integration costs resulting from the Rathbones deal as well as various capital costs incurred in contemplation of potential transactions. In the prior year, strategic actions largely comprised the Rathbones transaction, and thus were included in discontinued operations. 144 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 1. #### Segmental business analysis – income statement #### (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | | Specialist Banking | | Total Group | | | Private Client | | Corporate, Investment Banking and Other | | For the year to 31 March 2025 | Wealth & Investment | Private Banking | | £’000 | | Net interest income | 7 381 | 96 639 | 686 441 | 790 461 | | Fee and commission income | 10 424 | 979 | 182 937 | 194 340 | | Fee and commission expense | (1 054) | (19) | (12 791) | (13 864) | | Investment income | 1 | — | 41 810 | 41 811 | | Share of post-taxation operating profit of associates and joint venture holdings | 69 147 | — | 3 233 | 72 380 | | Trading income/(loss) arising from | | | | | | – customer flow | 1 792 | 3 018 | 80 732 | 85 542 | | – balance sheet management and other trading activities | (34) | (47) | 14 329 | 14 248 | | Other operating income | — | — | 6 676 | 6 676 | | Operating income | 87 657 | 100 570 | 1 003 367 | 1 191 594 | | Expected credit loss impairment charges | (16) | (5 582) | (91 442) | (97 040) | | Operating income after expected credit loss impairment charges | 87 641 | 94 988 | 911 925 | 1 094 554 | | Operating costs | (15 366) | (47 860) | (534 493) | (597 719) | | Profit attributable to non-controlling interests | — | — | (12) | (12) | | Adjusted operating profit | 72 275 | 47 128 | 377 420 | 496 823 | | Selected returns and key statistics | | | | | | Cost to income ratio | 17.5% | 47.6% | 53.3% | 50.2% | | Total assets (£’mn) | 1 022 | 5 196 | 23 516 | 29 734 | | Total liabilities (£'mn) | 185 | 26 | 25 850 | 26 061 | 145 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 1 . #### Segmental business analysis – income statement #### (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | | Specialist Banking | | | | | Private Client | | Corporate, Investment Banking and Other | | | For the year to 31 March 2024 \* | Wealth & Investment | Private Banking | | | £’000 | Total Group | | Net interest income | 8 340 | 107 268 | 713 349 | 828 957 | | Fee and commission income | 9 170 | 814 | 168 786 | 178 770 | | Fee and commission expense | (993) | (41) | (15 347) | (16 381) | | Investment income | 2 | — | 2 623 | 2 625 | | Share of post-taxation operating profit of associates and joint venture holdings | 66 868 | — | 274 | 67 142 | | Trading income/(loss) arising from | | | | | | – customer flow | 2 099 | 4 869 | 96 190 | 103 158 | | – balance sheet management and other trading activities | (662) | (49) | 27 830 | 27 119 | | Other operating income | — | — | 2 915 | 2 915 | | Operating income | 84 824 | 112 861 | 996 620 | 1 194 305 | | Expected credit loss impairment charges | 4 | (4 260) | (81 741) | (85 997) | | Operating income after expected credit loss impairment charges | 84 828 | 108 601 | 914 879 | 1 108 308 | | Operating costs | (14 178) | (49 863) | (562 691) | (626 732) | | Profit attributable to non-controlling interests | — | — | (1 204) | (1 204) | | Adjusted operating profit | 70 650 | 58 738 | 350 984 | 480 372 | | Selected returns and key statistics | | | | | | Cost to income ratio | 16.7% | 44.2% | 56.5% | 52.5% | | Total assets (£’mn)^ | 1 028 | 5 009 | 23 801 | 29 838 | | Total liabilities (£’mn)^ | 192 | 42 | 25 998 | 26 232 | \*Comparative figures have been restated to align with the way that financial information is reported to the chief operating decision makers. In addition, following a strategic review of our Private Capital business, previously reported as part of our Private Banking segment, the business is now reported in the Corporate, Investment Banking and Other segment. The comparative period has been restated to reflect this change. ^Given the nature of the Investec Wealth & Investment Limited transaction, the Group essentially retained similar economic interest to these investments before and after the transactions. To provide information that is more comparable to the current year, the prior year has been presented on a pro-forma basis as if the transactions had been in effect from the beginning of the prior year, i.e.Investec Wealth & Investment Limited has been presented as an equity accounted investment from the start of the prior year. Accordingly, operating profit after taxation of £35.9 million has been re-allocated to share of post-taxation operating profit of associates and joint venture holdings. This aligns the presentation with the basis on which management evaluates performance. 146 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 2. #### Net interest income | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | 2025 | | | | 2024 | | | | | For the year to 31 March | Notes | | Average balance sheet value | Interest income | Average yield | | Average balance sheet value | Interest income | Average yield | | | £’000 | | | Cash, near cash and bank debt and sovereign debt securities | 1 | | 9 975 819 | 477 608 | 4.79% | | 8 871 883 | 427 558 | 4.82% | | | Loans and advances\* | 2 | | 16 727 744 | 1 334 303 | 7.98% | | 16 247 191 | 1 304 395 | 8.03% | | | Private client | | | 5 189 467 | 281 839 | 5.43% | | 4 962 049 | 233 093 | 4.70% | | | Corporate, institutional and other clients | | | 11 538 277 | 1 052 464 | 9.12% | | 11 285 142 | 1 071 302 | 9.49% | | | Other debt securities and other loans and advances | | | 822 686 | 56 535 | 6.87% | | 920 886 | 66 290 | 7.20% | | | Other | 3 | | 141 669 | 111 405 | n/a | | 190 123 | 135 741 | n/a | | | Total interest-earning assets | | | 27 667 918 | 1 979 851 | 7.16% | | 26 230 083 | 1 933 984 | 7.37% | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | 2025 | | | | 2024 | | | | | For the year to 31 March | | | Average balance sheet value | Interest expense | Average yield | | Average balance sheet value | Interest expense | Average yield | | | £’000 | Notes | | | Deposits by banks and other debt-related securities^† | 4 | | 2 792 913 | 108 501 | 3.88% | | 3 397 885 | 133 767 | 3.94% | | | Customer accounts (deposits)^ | | | 21 578 083 | 944 449 | 4.38% | | 19 842 571 | 825 876 | 4.16% | | | Subordinated liabilities† | | | 690 113 | 42 565 | 6.17% | | 692 444 | 42 799 | 6.18% | | | Other | 5 | | 219 339 | 93 875 | n/a | | 259 387 | 102 585 | n/a | | | Total interest-bearing liabilities | | | 25 280 448 | 1 189 390 | 4.70% | | 24 192 287 | 1 105 027 | 4.57% | | | Net interest income | | | | 790 461 | | | | 828 957 | | | | Net interest margin | | | | 2.86% | | | | 3.16% | | | Notes: 1Comprises (as per the balance sheet) cash and balances at central banks; loans and advances to banks; reverse repurchase agreements and cash collateral on securities borrowed; sovereign debt securities; and bank debt securities. 2Comprises (as per the balance sheet) loans and advances to customers. 3Comprises (as per the balance sheet) lease receivables (housed in other assets on the balance sheet) as well as interest income from derivative financial instruments, other assets and intergroup assets where there is no associated balance sheet value. 4Comprises (as per the balance sheet) deposits by banks; debt securities in issue; repurchase agreements and cash collateral on securities lent. 5Comprises (as per the balance sheet) liabilities arising from lease liabilities (housed in other liabilities on the balance sheet) as well as interest expense from derivative financial instruments and intergroup liabilities where there is no associated balance sheet value. \*Following a strategic review of our Private Capital business, previously reported as part of our Private Banking segment, the business is now reported in the Corporate, Investment Banking and Other segment. The comparative period has been restated to reflect this change. ^Interest expense of £60.5 million due to the Bank of England incurred on TFSME was incorrectly classified as expense arising on customer accounts. This has been reclassified to arising on deposits by banks and other debt-related securities. †Interest expense £9.1 million in 2024 related to the interest unwind on a £200 million Euro Medium Term Notes (EMTNs) issuance was incorrectly classified as expense arising on subordinated liabilities. This has been reclassified to arising on deposits by banks and other debt-related securities. 147 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 3. #### Net fee and commission income | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Wealth & Investment businesses net fee and commission income\* | 9 370 | | 8 177 | | | Fund management fees/fees for assets under management | 9 050 | | 6 862 | | | Private client transactional fees | 1 374 | | 2 308 | | | Fee and commission expense | (1 054) | | (993) | | | Specialist Banking net fee and commission income | 171 106 | | 154 212 | | | Specialist Banking fee and commission income^ | 183 916 | | 169 600 | | | Specialist Banking fee and commission expense | (12 810) | | (15 388) | | | Net fee and commission income | 180 476 | | 162 389 | | | Fee and commission income | 194 340 | | 178 770 | | | Fee and commission expense | (13 864) | | (16 381) | | | Net fee and commission income | 180 476 | | 162 389 | | | Annuity fees (net of fees payable) | 35 594 | | 17 864 | | | Deal fees | 144 882 | | 144 525 | | | | | | | | \*Wealth & Investment businesses relates to Investec Bank (Switzerland) AG. ^Included in Specialist Banking is fee and commission income of £8.4 million (31 March 2024: £nil) for operating lease income, generated from aircraft leasing structures, which is out of the scope of IFRS 15 – Revenue from Contracts with Customers. 4. #### Investment income | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | For the year to 31 March | Listed equities | Unlisted equities | Warrants and profit shares | Total investment portfolio | | Debt securities (sovereign, bank and other) | Investment and trading properties | Other asset categories | Total | | | £’000 | | | | 2025 | | | | | | | | | | | | Realised | (2 001) | 6 526 | 1 194 | 5 719 | | 4 897 | — | (994) | 9 622 | | | Unrealised\* | 2 541 | 37 801 | (451) | 39 891 | | (3 410) | (11 000) | 702 | 26 183 | | | Dividend income | (15) | 4 427 | — | 4 412 | | — | — | 75 | 4 487 | | | Funding and other net related income | — | — | — | — | | — | 1 519 | — | 1 519 | | | | 525 | 48 754 | 743 | 50 022 | | 1 487 | (9 481) | (217) | 41 811 | | | 2024 | | | | | | | | | | | | Realised | (2 907) | 40 717 | 287 | 38 097 | | 831 | — | (8 368) | 30 560 | | | Unrealised\* | 2 798 | (32 260) | 450 | (29 012) | | (253) | (12 500) | 12 369 | (29 396) | | | Dividend income | — | 1 261 | — | 1 261 | | — | — | 200 | 1 461 | | | Funding and other net related income | — | — | — | — | | — | — | — | — | | | | (109) | 9 718 | 737 | 10 346 | | 578 | (12 500) | 4 201 | 2 625 | | \*In a year of realisation, any prior period mark-to-market gains/(losses) recognised are reversed in the unrealised line item and recognised in the realised line item. 148 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 5. #### Other operating income | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Losses recognised on property and equipment | (41) | | — | | | Income from operating leases | 2 595 | | 1 554 | | | Income from government grants\* | 4 122 | | 1 361 | | | | 6 676 | | 2 915 | | \*Government grants income includes Research and Development Expenditure Credits. 6. #### Expected credit loss impairment charges | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Expected credit losses have arisen on the following items: | | | | | | Loans and advances to customers | 97 279 | | 90 448 | | | Other loans and advances | 6 | | (63) | | | Other balance sheet assets | 859 | | (159) | | | Undrawn commitments and guarantees | (1 104) | | (4 229) | | | | 97 040 | | 85 997 | | 149 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 7. #### Operating costs | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Staff compensation costs | 410 175 | | 423 415 | | | Salaries and wages (including directors’ remuneration)\*\* | 326 337 | | 342 565 | | | Share-based payment expense | 20 005 | | 19 389 | | | Social security costs | 43 231 | | 41 461 | | | Pensions and provident fund contributions | 20 602 | | 20 000 | | | Training and other costs | 8 940 | | 5 160 | | | Staff costs | 419 115 | | 428 575 | | | Premises expenses | 27 156 | | 28 560 | | | Premises expenses (excluding depreciation and impairments) | 11 530 | | 13 687 | | | Premises depreciation and impairments | 15 626 | | 14 873 | | | Equipment expenses (excluding depreciation) | 48 152 | | 50 813 | | | Business expenses\* | 84 002 | | 106 306 | | | Marketing expenses | 13 129 | | 9 352 | | | Depreciation, amortisation and impairment of equipment, software and intangibles^ | 6 165 | | 3 126 | | | | 597 719 | | 626 732 | | \*Business expenses mainly comprise insurance costs, consulting and professional fees, travel expenses and subscriptions. The prior year includes a provision relating to motor vehicle financing. ^Included within depreciation charge for the year is £4 million (31 March 2024: £nil) of depreciation expense relating to other assets. \*\*Details of the directors’ emoluments, pensions and their interests are disclosed in the remuneration report on pages [96](#i447e4d363cd344738300acdd42f0e3a0_250) to [105](#ifa72657b73544d8db616102e7ba11496_35534). Segmental breakdown of operating costs | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | | Specialist Banking | | Total Group | | | Private Client | | Corporate, Investment Banking and Other | | For the year to 31 March 2025 | Wealth & Investment | Private Banking | | £’000 | | Staff costs | 8 019 | 17 180 | 393 916 | 419 115 | | Premises expenses | 579 | 1 397 | 25 180 | 27 156 | | Equipment expenses (excluding depreciation) | 3 258 | 6 645 | 38 249 | 48 152 | | Business expenses | 3 365 | 20 031 | 60 606 | 84 002 | | Marketing expenses | 76 | 2 607 | 10 446 | 13 129 | | Depreciation, amortisation and impairment of equipment, software and intangibles | 69 | — | 6 096 | 6 165 | | | 15 366 | 47 860 | 534 493 | 597 719 | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | | Specialist Banking | | Total Group | | | Private Client | | Corporate, Investment Banking and Other | | For the year to 31 March 2024 \* | Wealth & Investment | Private Banking | | £’000 | | Staff costs | 8 520 | 21 238 | 398 817 | 428 575 | | Premises expenses | 512 | 1 244 | 26 804 | 28 560 | | Equipment expenses (excluding depreciation) | 2 650 | 6 264 | 41 899 | 50 813 | | Business expenses | 2 347 | 17 754 | 86 205 | 106 306 | | Marketing expenses | 29 | 3 363 | 5 960 | 9 352 | | Depreciation, amortisation and impairment of equipment, software and intangibles | 120 | — | 3 006 | 3 126 | | | 14 178 | 49 863 | 562 691 | 626 732 | \*Following a strategic review of our Private Capital business, previously reported as part of our Private Banking segment, the business is now reported in the Corporate, Investment Banking and Other segment. The comparative period has been restated to reflect this change. During the year, the average number of permanent employees was 2 331 ( 2024 : 3 591). 150 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 7. #### Operating costs #### (continued) The amounts below represent the costs incurred or to be incurred by the Group in respect of the audit of the financial statements and for other audit related services for the respective financial years. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Deloitte (2025)/Ernst & Young (2024) fees | | | | | | Total audit fees | 5 274 | | 5 852 | | | Audit of the Group’s accounts | 4 758 | | 3 465 | | | Audit of the Group’s subsidiaries | 516 | | 2 387 | | | Total non-audit fees | 1 017 | | 1 118 | | | Audit related assurance services1 | — | | 759 | | | Other assurance services2 | 439 | | 346 | | | Services related to corporate finance transactions3 | — | | 13 | | | Other non-audit services | 578 | | — | | | Total auditor’s remuneration | 6 291 | | 6 970 | | 1.Audit related assurance fees consist of reviews of interim financial information. 2.Other assurance services relate to services required by law or regulation (including agreed-upon-procedures relating to statutory and regulatory filings and reporting to regulators on client assets). 3.Corporate finance transaction services relate to comfort letters on debt issuances. 151 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 8. #### Share-based payments The Investec Group operates share option and long-term share incentive plans for employees, the majority of which are on an equity-settled basis. The purpose of the staff share schemes is to promote an esprit de corps within the organisation, create an awareness of Investec Group’s performance and provide an incentive to maximise individual business unit and Investec Group performance by allowing all staff to share in the risks and rewards of the Investec Group. Awards made under the UK share schemes are settled in Investec Plc shares (INVP). These awards are contingent on the continued employment of employees up to the date of vesting. Equity-settled awards granted under Investec share plans The share incentive plans are granted in the following award types, each of which vest in line with the specified parameters. Forfeitable share awards are shares held in the name of or for the benefit of an employee, for which the employee has dividend and voting rights. Conditional awards are the right to receive a share at a future date once the service conditions have been met. Employees do not have a right to dividends or voting rights on these grants until vesting. Nil-cost options are share options in respect of which no option price is payable and where the employee has no dividends or voting rights. Forfeitable and conditional awards and nil cost options are awarded to employees for no consideration. These are settled by grants from the Investec Group’s share scheme trusts, which acquire shares through purchase of shares on market. | | | | | | --- | --- | --- | --- | | | | | | | For the year to 31 March | 2025 | | 2024^ | | £’000 | | | Share-based payment expense: | | | | | Equity-settled | 20 005 | | 19 389 | Group | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Weighted average fair value of awards granted in the year | | | | | | UK schemes | 18 522 | | 17 029 | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | UK schemes | | | | | | | | 2025 | | | 2024 | | | | Details of awards outstanding during the year | Number of share awards | Weighted average exercise price £ | | Number of share awards | Weighted average exercise price £ | | | Outstanding at the beginning of the year | 22 018 834 | — | | 23 667 017 | — | | | Deconsolidation of subsidiaries | — | — | | (748 335) | — | | | Transfer of employees during the year | — | — | | 375 | — | | | Granted during the year | 3 743 001 | — | | 4 192 672 | — | | | Exercised during the year^ | (6 690 728) | — | | (4 434 180) | — | | | Awards forfeited during the year | (617 459) | — | | (658 715) | — | | | Outstanding at the end of the year | 18 453 648 | — | | 22 018 834 | — | | | Exercisable at the end of the year | 324 315 | — | | 418 451 | — | | ^The weighted average share price of options exercised during the year was £5.37 (2024: £4.58). The weighted average share price during the year was £5.50 (2024: £4.81). 152 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 8. #### Share-based payments #### (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Additional information relating to awards: | 2025 | | 2024 | | | Long-term incentive grants with no strike price | | | | | | Exercise price range | £nil | | £nil | | | Weighted average remaining contractual life | 1.54 years | | 1.58 years | | | Weighted average fair value of awards and long-term grants at measurement date | £4.95 | | £4.06 | | | The fair values of awards granted were calculated at market price, adjusted for relevant terms and conditions as applicable. For awards granted during the year, the inputs into the model were as follows: | | | | | | – Share price at date of grant | £5.16–£5.77 | | £4.25–£5.13 | | | – Exercise price | £nil | | £nil | | | – Expected volatility | n/a | | n/a | | | – Award life | 0–7.01 years | | 2.00–7.01 years | | | – Expected dividend yields | n/a | | n/a | | | – Risk-free rate | n/a | | n/a | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | UK schemes | | | | | | | | 2025 | | | 2024 | | | | Year of vesting by award type | Number of share awards outstanding | Year of vesting | | Number of share awards outstanding | Year of vesting | | | Conditional awards | 618 203 | 3,4,5 | | 384 616 | 3,4,5 | | | Executive conditional awards | 2 286 955 | 1,2,3 & 3,4,5 & 3,4,5,6,7 | | 3 174 305 | 1,2,3 & 3,4,5 & 3,4,5,6,7 | | | Forfeitable shares | 15 533 490 | 3,4,5 | | 18 444 913 | 3,4,5 | | | Nil-cost options | 15 000 | 4,5 | | 15 000 | 4,5 | | | Outstanding at the end of the year | 18 453 648 | | | 22 018 834 | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Vesting period of outstanding options by financial year | 2025 | | 2024 | | | Year to 31 March 2024 | — | | 418 451 | | | Year to 31 March 2025 | 324 315 | | 6 462 466 | | | Year to 31 March 2026 | 7 719 997 | | 8 013 889 | | | Year to 31 March 2027 | 4 019 697 | | 4 152 224 | | | Year to 31 March 2028 | 3 818 374 | | 2 766 737 | | | Year to 31 March 2029 | 2 404 331 | | 148 711 | | | Year to 31 March 2030 | 101 318 | | 49 567 | | | Year to 31 March 2031 | 36 200 | | 6 789 | | | Year to 31 March 2032 | 29 416 | | — | | | Outstanding at the end of the year | 18 453 648 | | 22 018 834 | | 153 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 8. #### Share-based payments #### (continued) Company | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Weighted average fair value of awards granted in the year | | | | | | UK schemes | 14 375 | | 13 431 | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | UK schemes | | | | | | | | 2025 | | | 2024 | | | | Details of awards outstanding during the year | Number of share awards | Weighted average exercise price £ | | Number of share awards | Weighted average exercise price £ | | | Outstanding at the beginning of the year | 19 016 003 | — | | 19 776 521 | — | | | Transfer of employees during the year | (204 692) | — | | (35 312) | — | | | Granted during the year | 2 867 082 | — | | 3 276 702 | — | | | Exercised during the year^ | (5 816 488) | — | | (3 530 524) | — | | | Awards forfeited during the year | (554 531) | — | | (471 384) | — | | | Outstanding at the end of the year | 15 307 374 | — | | 19 016 003 | — | | | Exercisable at the end of the year | 180 968 | — | | 189 609 | — | | ^The weighted average share price of options exercised during the year was £5.37 (2024: £4.61). The weighted average share price during the year was £5.50 (2024 : £4.81). 154 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 8. #### Share-based payments #### (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Additional information relating to awards: | 2025 | | 2024 | | | Company | | | | | | Long-term incentive grants with no strike price | | | | | | Exercise price range | £nil | | £nil | | | Weighted average remaining contractual life | 1.48 years | | 1.55 years | | | Weighted average fair value of awards and long-term grants at measurement date | £5.01 | | £4.10 | | | The fair values of awards granted were calculated at market price, adjusted for relevant terms and conditions as applicable. For awards granted during the year, the inputs into the model were as follows: | | | | | | – Share price at date of grant | £5.16–£5.77 | | £4.25– £5.13 | | | – Exercise price | £nil | | £nil | | | – Expected volatility | n/a | | n/a | | | – Award life | 0–7.01 years | | 2.00–7.01 years | | | – Expected dividend yields | n/a | | n/a | | | – Risk-free rate | n/a | | n/a | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | UK schemes | | | | | | | | 2025 | | | 2024 | | | | Summary by award type | Number of share awards outstanding | Year of vesting | | Number of share awards outstanding | Year of vesting | | | Conditional awards | 12 531 | 3,4,5 | | — | | | | Executive conditional awards | 2 056 240 | 1,2,3 & 3,4,5 & 3,4,5,6,7 | | 2 848 131 | 1,2,3 & 3,4,5 & 3,4,5,6,7 | | | Forfeitable shares | 13 238 603 | 3,4,5 | | 16 167 872 | 3,4,5 | | | Outstanding at the end of the year | 15 307 374 | | | 19 016 003 | | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Vesting period of outstanding options by financial year | 2025 | | 2024 | | | Year to 31 March 2024 | — | | 189 609 | | | Year to 31 March 2025 | 180 968 | | 5 736 875 | | | Year to 31 March 2026 | 6 789 400 | | 7 135 866 | | | Year to 31 March 2027 | 3 363 820 | | 3 508 031 | | | Year to 31 March 2028 | 3 012 169 | | 2 258 040 | | | Year to 31 March 2029 | 1 809 211 | | 131 226 | | | Year to 31 March 2030 | 86 190 | | 49 567 | | | Year to 31 March 2031 | 36 200 | | 6 789 | | | Year to 31 March 2032 | 29 416 | | — | | | Outstanding at the end of the year | 15 307 374 | | 19 016 003 | | 155 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 9. #### Long-term employment benefits Group In March 2020, as part of the Investec Asset Management Limited (IAM) demerger, each participant of the Investec Group share option and long-term share incentive plans received the right to receive one Ninety One plc share award for every two Investec plc share awards they held. The Ninety One plc share awards were granted on the same terms and vesting period as the Investec plc awards they related to. Investec DLC has an obligation to deliver Ninety One plc shares to the holders of Investec plc share awards. Accordingly, this obligation was classified and measured as an other long-term liability in terms of IAS 19 Employee Benefits (IAS 19). The initial liability of £5 354 000 was calculated as the fair value of the liability at the date of demerger for the portion of the awards already vested. The total value of the liability represented past service cost and as a result was accounted for in retained income. The liability was subsequently measured at fair value through profit and loss. A further 15% of Investec DLC’s shareholding in Ninety One DLC was distributed to ordinary shareholders on 30 May 2022. Each participant of the Investec share option and long-term share incentive plans for employees, received the right to receive 0.13751 Ninety One shares for each Investec share option they had. In addition, management approved the acceleration of certain remaining Ninety One awards. Participants had 90 days to exercise the acceleration. The acceleration excluded awards made to senior management. IAS 19 long-term employment benefit liability fair value movement recognised in the income statement for the year ended 31 March 2025 was £0 (31 March 2024: £0.2 million). | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | 2025 | | | 2024 | | | | Details of awards outstanding during the year | Number of Ninety One awards | Weighted average exercise price £ | | Number of Ninety One awards | Weighted average exercise price £ | | | Outstanding at the beginning of the year | 536 787 | — | | 1 567 698 | — | | | Transfer of employees during the year | — | — | | 74 | — | | | Granted during the year | — | — | | 12 341 | — | | | Exercised during the year | (242 258) | — | | (1 021 957) | — | | | Awards reinstated / (lapsed) during the year | 2 046 | — | | (21 369) | — | | | Outstanding at the end of the year | 296 575 | — | | 536 787 | — | | | Exercisable at the end of the year | 123 306 | — | | 141 765 | — | | For the liability calculated, the inputs into the model were as follows: | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Additional information relating to awards: | 2025 | | 2024 | | | The fair value of the liability was calculated by using the Black-Scholes option pricing model. | | | | | | – Listed share price at 31 March | £1.44 | | £1.71 | | | – Exercise price | £nil | | Nil | | | – Expected volatility | 32.62%–33.00% | | 30.96%–31.37% | | | – Award life | 0–3.41 years | | 0–4.42 years | | | – Expected dividend yields | 0%–11.61% | | 0%–5.54% | | | – Risk-free rate | 3.91%–4.28% | | 3.78%–5.07% | | 156 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 9. #### Long-term employment benefits #### (continued) Company In March 2020, as part of the Investec Asset Management Limited (IAM) demerger, each participant of the Investec Group share option and long-term share incentive plans for employees, received the right to receive one Ninety One plc share award for every two Investec plc share awards they held. The Ninety One plc share awards were granted on the same terms and vesting period as the Investec plc awards they related to. Investec DLC has an obligation to deliver Ninety One plc shares to the holders of Investec plc share awards, accordingly this obligation was classified and measured as another long-term liability in terms of IAS 19 Employee Benefits (IAS 19). The initial liability of £3 987 000 was calculated as the fair value of the liability at the date of demerger for the portion of the awards already vested. The total value of the liability represented past service cost and as a result was accounted for in retained income. The liability was subsequently measured at fair value through profit or loss. A further 15% of Investec DLC’s shareholding in Ninety One DLC was distributed to ordinary shareholders on 30 May 2022. Each participant of the Investec share option and long-term share incentive plans for employees, received the right to receive 0.13751 Ninety One shares for each Investec share option they had. In addition, management approved the acceleration of certain remaining Ninety One awards. Participants had 90 days to exercise the acceleration. The acceleration excluded awards made to senior management. IAS 19 long-term employment benefit liability fair value movement recognised in the income statement for the year ended 31 March 2025 was £0 ( 31 March 2024: £0.1 million). | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | 2025 | | | 2024 | | | | Details of awards outstanding during the year | Number of Ninety One awards | Weighted average exercise price £ | | Number of Ninety One awards | Weighted average exercise price £ | | | Outstanding at the beginning of the year | 426 879 | — | | 1 149 125 | — | | | Transfer of employees during the year | — | — | | (148) | — | | | Granted during the year | — | — | | 12 341 | — | | | Exercised during the year | (208 324) | — | | (728 174) | — | | | Awards reinstated / (lapsed) during the year | 2 046 | — | | (6 265) | — | | | Outstanding at the end of the year | 220 601 | — | | 426 879 | — | | | Exercisable at the end of the year | 51 852 | — | | 44 204 | — | | For the liability calculated, the inputs into the model were as follows: | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Additional information relating to awards: | 2025 | | 2024 | | | The fair value of the liability was calculated by using the Black-Scholes option pricing model. | | | | | | – Listed share price at 31 March | £1.44 | | £1.71 | | | – Exercise price | £nil | | £nil | | | – Expected volatility | 32.62%–32.92% | | 31.04%–31.37% | | | – Award life | 0–3.41 years | | 0–4.42 years | | | – Expected dividend yields | 0%–11.61% | | 0%–5.54% | | | – Risk-free rate | 3.91%–4.28% | | 3.78%–5.07% | | 157 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 10. #### Taxation | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Income statement taxation charge | | | | | | Current taxation | | | | | | UK | | | | | | Current taxation on income for the year | 75 449 | | 95 872 | | | Adjustments in respect of prior years | 1 390 | | 2 095 | | | Corporation tax before double tax relief | 76 839 | | 97 967 | | | Double tax relief | (402) | | (566) | | | | 76 437 | | 97 401 | | | Europe | 8 223 | | 7 383 | | | Australia | 106 | | 333 | | | Other\* | 458 | | 1 336 | | | | 8 787 | | 9 052 | | | Total current taxation | 85 224 | | 106 453 | | | Deferred taxation | | | | | | UK | (5 056) | | (9 689) | | | Europe | 92 | | (199) | | | Other | 157 | | (36) | | | Total deferred taxation | (4 807) | | (9 924) | | | Total taxation charge for the year | 80 417 | | 96 529 | | | Total taxation charge for the year comprises: | | | | | | Taxation on operating profit before goodwill | 80 222 | | 96 956 | | | Taxation on acquired intangibles, goodwill and disposal of subsidiaries | 195 | | (427) | | | | 80 417 | | 96 529 | | | Deferred taxation comprises: | | | | | | Origination and reversal of temporary differences | (2 268) | | (8 560) | | | Changes in taxation rates | 462 | | (616) | | | Adjustment in respect of prior years | (3 001) | | (748) | | | | (4 807) | | (9 924) | | | The deferred taxation credit in the income statement arose from: | | | | | | Deferred capital allowances | (10 621) | | (3 125) | | | Income and expenditure accruals | 889 | | 25 | | | Asset in respect of unexpired options | 4 073 | | (6 349) | | | Unrealised fair value adjustment on financial instruments | 203 | | (283) | | | Movement in deferred tax assets related to assessed losses | 649 | | 33 | | | Asset in respect of pension surplus | — | | 10 | | | Deferred tax on acquired intangibles | — | | (235) | | | | (4 807) | | (9 924) | | | The deferred taxation charge in OCI/equity arose from: | | | | | | Asset in respect of unexpired options | 5 291 | | (6 433) | | | Unrealised fair value adjustment on financial instruments | (1 739) | | 14 119 | | | | 3 552 | | 7 686 | | \*Where Other largely includes India and North America. 158 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 10 . #### Taxation #### (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | The rates of corporation tax for the relevant years are: | % | | % | | | UK | 25 | | 25 | | | Europe (average) | 10 | | 10 | | | Australia | 30 | | 30 | | | Profit before taxation | 446 848 | | 421 742 | | | Taxation on profit before taxation | 80 417 | | 96 529 | | | Effective tax rate | 18.0% | | 22.9% | | | The taxation charge on activities for the year is different from the standard rate as detailed below: | | | | | | Taxation on profit on ordinary activities before taxation at UK rate of 25% (2024 : 25%) | 111 711 | | 105 435 | | | Taxation adjustments relating to foreign earnings | (11 119) | | (11 004) | | | Taxation relating to prior years | (1 612) | | 1 347 | | | Non-operating items | 12 671 | | 2 | | | Share options accounting expense/(income) | 941 | | (1 123) | | | Non-taxable income | (18 717) | | (2 238) | | | Net other permanent differences | (6 993) | | (755) | | | Bank surcharge | 3 558 | | 6 910 | | | Capital gains – non-taxable/covered by losses | (6 565) | | 369 | | | Movement in unrecognised trading losses | (3 920) | | (1 798) | | | Change in tax rate | 462 | | (616) | | | Total taxation charge as per income statement | 80 417 | | 96 529 | | | Other comprehensive income taxation effects | | | | | | Gains on realisation of debt instruments at FVOCI recycled through the income statement | (166) | | (817) | | | Pre-taxation | (230) | | (966) | | | Taxation effect | 64 | | 149 | | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income | (6 120) | | 6 078 | | | Pre-taxation | (8 705) | | 8 188 | | | Taxation effect | 2 585 | | (2 110) | | | Cash flow hedge reserve | (11 259) | | 17 664 | | | Pre-taxation | (15 637) | | 24 533 | | | Taxation effect | 4 378 | | (6 869) | | | Statement of changes in equity taxation effects | | | | | | Additional Tier 1 capital | (38 356) | | (20 634) | | | Pre-taxation | (38 356) | | (20 634) | | | Taxation effect | — | | — | | | Share-based payment adjustment | (559) | | 6 984 | | | Pre-taxation | — | | — | | | Taxation effect | (559) | | 6 984 | | | | | | | | Global Minimum Tax Pillar Two legislation has been enacted or substantively enacted in certain jurisdictions the Group operates. The legislation is effective for the Group’s financial year beginning 1 April 2024. The Group is in scope of the enacted or substantively enacted legislation and has performed an assessment of the Group’s potential exposure to Pillar Two income taxes. The assessment of the potential exposure to Pillar Two income taxes is based on the most recent tax filings, country-by-country reporting and financial statements for the constituent entities in the Group. Based on the assessment, the Pillar Two effective tax rates in most of the jurisdictions in which the Group operates are above 15%. However, there are a limited number of jurisdictions (Guernsey, Jersey and Isle of Man) where the transitional safe harbour relief does not apply and the Pillar Two effective tax rate is below 15%. The Group has applied a temporary mandatory relief from deferred tax accounting for the impacts of the top-up tax and accounts for it as a current tax when it is incurred. We will continue to review the impact of the Pillar Two rules as further guidance is released by the OECD and additional governments implement this tax regime. 159 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 11. #### Dividends | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Ordinary dividends | | | | | | Dividends for current year | 120 000 | | 89 798 | | | Total dividends attributable to ordinary shareholder | 120 000 | | 89 798 | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Dividend attributable to Additional Tier 1 securities | 38 356 | | 20 638 | | The £200 000 000 Fixed Rate Reset Perpetual Additional Tier 1 Write Down Capital Securities, issued on 16 October 2017, paid a distribution rate of 6.75% per annum quarterly. A further £50 000 000 Fixed Rate Reset Perpetual Additional Tier 1 Write Down Capital Securities, issued on 22 January 2019, paid a distribution rate of 6.75% per annum quarterly after the initial short period distribution paid on 5 March 2019. These notes were consolidated to form a single series with the £200 000 000 notes issued on 16 October 2017. £141 892 000 of these securities were bought back on 1 March 2024 and the remaining £108 108 000 were bought back on 5 December 2024. On 28 February 2024, £350 000 000 Fixed Rate Reset Perpetual Additional Tier 1 Write Down Capital Securities were issued paying a distribution rate of 10.5% per annum semi-annually. The dividend is shown gross of UK corporation tax. 160 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 12. #### Analysis of income and impairments by category of financial instrument | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | At fair value through profit or loss | | | | | | IFRS 9 mandatory | | | | | For the year to 31 March | Trading\*\* | Non-trading\*\* | Designated at inception | | | £’000 | | | 2025 | | | | | | Interest income | 68 841 | 75 189 | — | | | Interest expense | (67 699) | — | — | | | Fee and commission income | 17 168 | 1 453 | — | | | Fee and commission expense | — | — | — | | | Investment income | 8 518 | 40 883 | (60) | | | Share of post-taxation profit of associates and joint venture holdings | — | — | — | | | Trading income/(loss) arising from | | | | | | – customer flow | 93 781 | 78 | — | | | – balance sheet management and other trading activities | 279 | 15 299 | — | | | Other operating income | — | — | — | | | Total operating income/(expense) before expected credit loss | 120 888 | 132 902 | (60) | | | Expected credit loss impairments charges | — | — | — | | | Operating income/(expense) | 120 888 | 132 902 | (60) | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | Trading\*\* | Non-trading\*\* | Designated at inception | | | £’000 | | | 2024 | | | | | | Interest income^ | 87 342 | 81 632 | — | | | Interest expense^ | (78 865) | — | — | | | Fee and commission income | 13 685 | 1 054 | — | | | Fee and commission expense | — | — | — | | | Investment income | (1 365) | 16 554 | (3 550) | | | Share of post-taxation profit of associates and joint venture holdings# | — | — | — | | | Trading income/(loss) arising from | | | | | | – customer flow | 105 349 | (736) | 451 | | | – balance sheet management and other trading activities | 372 | 27 119 | — | | | Other operating income | — | — | — | | | Total operating income/(expense) before expected credit loss | 126 518 | 125 623 | (3 099) | | | Expected credit loss impairments charges^^ | — | — | — | | | Operating income/(expense) | 126 518 | 125 623 | (3 099) | | \*Includes off-balance sheet items. \*\*Fair value through profit and loss items have been split as trading and non-trading, as defined by regulatory rules for the trading book and banking book requirements, respectively, other than derivatives, which are all classified as trading. Trading consists of positions held for trading intent or hedge elements of the trading book. Non- trading consists of income and expenses from positions that are expected to be held to maturity. ^In the current year, net interest income and expense have been disaggregated into interest income and interest expense, the prior period has been re-presented on the same basis. ^^Expected credit loss impairment charges have also been disaggregated to align with the balance sheet IFRS 9 classification of the underlying assets and off-balance sheet items. #Restated as detailed in note 57. 161 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | At fair value through comprehensive income | | | | | | | | | | | | | | | | Debt instruments with a dual business model | Amortised cost | Non-financial instruments | Other fee income and expenses\* | | Total | | | | | | | | | | | | | | 235 290 | 1 596 858 | 3 673 | — | | 1 979 851 | | | — | (1 111 982) | (9 709) | — | | (1 189 390) | | | — | 80 872 | — | 94 847 | | 194 340 | | | — | (2 953) | — | (10 911) | | (13 864) | | | 228 | 1 022 | (8 780) | — | | 41 811 | | | — | — | 38 081 | — | | 38 081 | | | | | | | | | | | — | (8 317) | — | — | | 85 542 | | | — | (1 330) | — | — | | 14 248 | | | — | 2 595 | (41) | 4 122 | | 6 676 | | | 235 518 | 556 765 | 23 224 | 88 058 | | 1 157 295 | | | (9 886) | (88 258) | — | 1 104 | | (97 040) | | | 225 632 | 468 507 | 23 224 | 89 162 | | 1 060 255 | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | Debt instruments with a dual business model | Amortised cost | Non-financial instruments | Other fee income and expenses\* | | Total | | | | | | | | | | | | | | 175 370 | 1 578 933 | 10 707 | — | | 1 933 984 | | | — | (1 014 993) | (11 169) | — | | (1 105 027) | | | — | 69 721 | — | 94 310 | | 178 770 | | | — | (2 736) | — | (13 645) | | (16 381) | | | 966 | 700 | (10 680) | — | | 2 625 | | | — | — | 9 032 | — | | 9 032 | | | | | | | | | | | — | (1 906) | — | — | | 103 158 | | | — | (372) | — | — | | 27 119 | | | — | 1 554 | — | 1 361 | | 2 915 | | | 176 336 | 630 901 | (2 110) | 82 026 | | 1 136 195 | | | (8 209) | (82 017) | — | 4 229 | | (85 997) | | | 168 127 | 548 884 | (2 110) | 86 255 | | 1 050 198 | | 162 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 13. #### Analysis of financial assets and liabilities by category of financial instruments | | | | | | --- | --- | --- | --- | | | | | | | | At fair value through profit or loss | | | | | IFRS 9 mandatory | | | | At 31 March | Trading\* | Non–trading\* | Designated at initial recognition | | £’000 | | Group | | | | | 2025 | | | | | Assets | | | | | Cash and balances at central banks | — | — | — | | Loans and advances to banks | — | — | — | | Reverse repurchase agreements and cash collateral on securities borrowed | — | 56 413 | — | | Sovereign debt securities | — | — | — | | Bank debt securities | — | — | — | | Other debt securities | — | 49 736 | — | | Derivative financial instruments | 325 886 | — | — | | Securities arising from trading activities | 149 912 | — | — | | Loans and advances to customers | — | 571 929 | — | | Other loans and advances | — | — | — | | Investment portfolio | — | 211 753 | — | | Interests in associated undertakings and joint venture holdings | — | — | — | | Current taxation assets | — | — | — | | Deferred taxation assets | — | — | — | | Other assets | 1 228 | — | — | | Property and equipment | — | — | — | | Goodwill | — | — | — | | Software | — | — | — | | | 477 026 | 889 831 | — | | Liabilities | | | | | Deposits by banks | — | — | — | | Derivative financial instruments | 274 791 | — | — | | Other trading liabilities | 16 242 | — | — | | Repurchase agreements and cash collateral on securities lent | — | — | — | | Customer accounts (deposits) | — | — | — | | Debt securities in issue | — | — | — | | Current taxation liabilities | — | — | — | | Other liabilities | — | — | — | | | 291 033 | — | — | | Subordinated liabilities | — | — | — | | | 291 033 | — | — | \*Fair value through profit and loss positions have been split as trading and non-trading, as defined by regulatory rules for the trading book and banking book requirements, respectively, other than derivatives, which are all classified as trading. Trading consists of positions held for trading intent or hedge elements of the trading book. For more information on hedges, please refer to note 49 on pages [222](#i447e4d363cd344738300acdd42f0e3a0_442) to [229](#ifc673f09145846e689b235b7346e602a_1630). 163 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | At fair value through comprehensive income | | | | | | | | | | | | | | | | Debt instrument with dual business model | | Total instruments at fair value | Amortised cost | Non-financial instruments or scoped out of IFRS 9 | Total | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | — | | — | 4 191 750 | — | 4 191 750 | | | — | | — | 859 802 | — | 859 802 | | | — | | 56 413 | 1 584 352 | — | 1 640 765 | | | 1 335 652 | | 1 335 652 | 1 189 050 | — | 2 524 702 | | | 324 179 | | 324 179 | — | — | 324 179 | | | 8 777 | | 58 513 | 712 209 | — | 770 722 | | | — | | 325 886 | — | — | 325 886 | | | — | | 149 912 | — | — | 149 912 | | | 2 005 308 | | 2 577 237 | 14 236 486 | — | 16 813 723 | | | — | | — | 162 882 | — | 162 882 | | | — | | 211 753 | — | — | 211 753 | | | — | | — | — | 832 141 | 832 141 | | | — | | — | — | 7 016 | 7 016 | | | — | | — | — | 120 918 | 120 918 | | | — | | 1 228 | 380 319 | 295 771 | 677 318 | | | — | | — | — | 58 940 | 58 940 | | | — | | — | — | 56 934 | 56 934 | | | — | | — | — | 4 742 | 4 742 | | | 3 673 916 | | 5 040 773 | 23 316 850 | 1 376 462 | 29 734 085 | | | | | | | | | | | — | | — | 1 477 568 | — | 1 477 568 | | | — | | 274 791 | — | — | 274 791 | | | — | | 16 242 | — | — | 16 242 | | | — | | — | 178 202 | — | 178 202 | | | — | | — | 21 555 444 | — | 21 555 444 | | | — | | — | 974 371 | — | 974 371 | | | — | | — | — | 9 023 | 9 023 | | | — | | — | 509 303 | 384 243 | 893 546 | | | — | | 291 033 | 24 694 888 | 393 266 | 25 379 187 | | | — | | — | 682 218 | — | 682 218 | | | — | | 291 033 | 25 377 106 | 393 266 | 26 061 405 | | 164 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 13. #### Analysis of financial assets and liabilities by category of financial instruments #### (continued) | | | | | | --- | --- | --- | --- | | | | | | | | At fair value through profit or loss | | | | | IFRS 9 mandatory | | | | At 31 March | Trading\* | Non–trading\* | Designated at initial recognition | | £’000 | | Group | | | | | 2024^ | | | | | Assets | | | | | Cash and balances at central banks | — | — | — | | Loans and advances to banks | — | — | — | | Reverse repurchase agreements and cash collateral on securities borrowed | — | 164 319 | — | | Sovereign debt securities | — | — | — | | Bank debt securities | — | — | — | | Other debt securities | — | 59 678 | — | | Derivative financial instruments | 432 395 | — | — | | Securities arising from trading activities | 145 200 | 1 433 | 10 699 | | Loans and advances to customers | — | 641 197 | — | | Other loans and advances | — | — | — | | Other securitised assets | — | — | 66 702 | | Investment portfolio | — | 244 140 | — | | Interests in associated undertakings and joint venture holdings | — | — | — | | Current taxation assets | — | — | — | | Deferred taxation assets | — | — | — | | Other assets | 4 732 | — | — | | Property and equipment | — | — | — | | Goodwill | — | — | — | | Software | — | — | — | | | 582 327 | 1 110 767 | 77 401 | | Liabilities | | | | | Deposits by banks | — | — | — | | Derivative financial instruments | 409 255 | — | — | | Other trading liabilities | 18 449 | — | — | | Repurchase agreements and cash collateral on securities lent | — | — | — | | Customer accounts (deposits) | — | — | — | | Debt securities in issue | — | — | 9 823 | | Liabilities arising on securitisation of other assets | — | — | 71 751 | | Current taxation liabilities | — | — | — | | Other liabilities | — | — | — | | | 427 704 | — | 81 574 | | Subordinated liabilities | — | — | — | | | 427 704 | — | 81 574 | \*Fair value through profit and loss positions have been split as trading and non-trading, as defined by regulatory rules for the trading book and banking book requirements, respectively, other than derivatives, which are all classified as trading. Trading consists of positions held for trading intent or hedge elements of the trading book. ^Restated as detailed in note 57. For more information on hedges, please refer to note 49 on pages [222](#i447e4d363cd344738300acdd42f0e3a0_442) to [229](#ifc673f09145846e689b235b7346e602a_1630). 165 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | At fair value through comprehensive income | | | | | | | | | | | | | | | | Debt instrument with dual business model | | Total instruments at fair value | Amortised cost | Non-financial instruments or scoped out of IFRS 9 | Total | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | — | | — | 5 661 623 | — | 5 661 623 | | | — | | — | 676 001 | — | 676 001 | | | — | | 164 319 | 975 796 | — | 1 140 115 | | | 993 289 | | 993 289 | 934 845 | — | 1 928 134 | | | 247 263 | | 247 263 | 49 992 | — | 297 255 | | | 8 552 | | 68 230 | 640 055 | — | 708 285 | | | — | | 432 395 | — | — | 432 395 | | | — | | 157 332 | — | — | 157 332 | | | 1 471 371 | | 2 112 568 | 14 457 745 | — | 16 570 313 | | | — | | — | 145 545 | — | 145 545 | | | — | | 66 702 | — | — | 66 702 | | | — | | 244 140 | — | — | 244 140 | | | — | | — | — | 791 272 | 791 272 | | | — | | — | — | 13 254 | 13 254 | | | — | | — | — | 119 730 | 119 730 | | | — | | 4 732 | 450 714 | 294 901 | 750 347 | | | — | | — | — | 72 947 | 72 947 | | | — | | — | — | 58 082 | 58 082 | | | — | | — | — | 4 571 | 4 571 | | | 2 720 475 | | 4 490 970 | 23 992 316 | 1 354 757 | 29 838 043 | | | | | | | | | | | — | | — | 2 174 305 | — | 2 174 305 | | | — | | 409 255 | — | — | 409 255 | | | — | | 18 449 | — | — | 18 449 | | | — | | — | 85 091 | — | 85 091 | | | — | | — | 20 851 216 | — | 20 851 216 | | | — | | 9 823 | 947 064 | — | 956 887 | | | — | | 71 751 | — | — | 71 751 | | | — | | — | — | 8 624 | 8 624 | | | — | | — | 557 111 | 430 326 | 987 437 | | | — | | 509 278 | 24 614 787 | 438 950 | 25 563 015 | | | — | | — | 668 810 | — | 668 810 | | | — | | 509 278 | 25 283 597 | 438 950 | 26 231 825 | | 166 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 13. #### Analysis of financial assets and liabilities by category of financial instruments #### (continued) | | | | | | --- | --- | --- | --- | | | | | | | | At fair value through profit or loss | | | | | IFRS 9 mandatory | | | | At 31 March | Trading\* | Non–trading\* | Designated at initial recognition | | £’000 | | Company | | | | | 2025 | | | | | Assets | | | | | Cash and balances at central banks | — | — | — | | Loans and advances to banks | — | — | — | | Reverse repurchase agreements and cash collateral on securities borrowed | — | 56 413 | — | | Sovereign debt securities | — | — | — | | Bank debt securities | — | — | — | | Other debt securities | — | 49 111 | — | | Derivative financial instruments | 311 854 | — | — | | Securities arising from trading activities | 149 912 | — | — | | Loans and advances to customers | — | 512 882 | — | | Other loans and advances | — | 9 460 | — | | Investment portfolio | — | 32 027 | — | | Interests in associated undertakings and joint venture holdings | — | — | — | | Current taxation assets | — | — | — | | Deferred taxation assets | — | — | — | | Other assets | 1 228 | — | — | | Property and equipment | — | — | — | | Investment in subsidiaries | — | — | | | | 462 994 | 659 893 | — | | Liabilities | | | | | Deposits by banks | | — | — | | Derivative financial instruments | 267 909 | — | — | | Other trading liabilities | 16 242 | — | — | | Repurchase agreements and cash collateral on securities lent | — | — | — | | Customer accounts (deposits) | — | — | — | | Debt securities in issue | — | — | — | | Other liabilities | — | — | — | | | 284 151 | — | — | | Subordinated liabilities | — | — | — | | | 284 151 | — | — | \*Fair value through profit and loss positions have been split as trading and non-trading, as defined by regulatory rules for the trading book and banking book requirements, respectively, other than derivatives, which are all classified as trading. Trading consists of positions held for trading intent or hedge elements of the trading book. For more information on hedges, please refer to note 49 on pages [222](#i447e4d363cd344738300acdd42f0e3a0_442) to [229](#ifc673f09145846e689b235b7346e602a_1630) . 167 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | At fair value through comprehensive income | | | | | | | | | | | | | | | | Debt instrument with dual business model | | Total instruments at fair value | Amortised cost | Non-financial instruments or scoped out of IFRS 9 | Total | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | — | | — | 4 175 092 | — | 4 175 092 | | | — | | — | 450 989 | — | 450 989 | | | — | | 56 413 | 1 584 352 | — | 1 640 765 | | | 449 340 | | 449 340 | 1 045 860 | — | 1 495 200 | | | 324 179 | | 324 179 | — | — | 324 179 | | | 8 777 | | 57 888 | 1 337 273 | — | 1 395 161 | | | — | | 311 854 | — | — | 311 854 | | | — | | 149 912 | — | — | 149 912 | | | 1 936 974 | | 2 449 856 | 10 343 625 | — | 12 793 481 | | | — | | 9 460 | 3 331 046 | — | 3 340 506 | | | — | | 32 027 | — | — | 32 027 | | | — | | — | — | 787 400 | 787 400 | | | — | | — | — | 33 049 | 33 049 | | | — | | — | — | 50 454 | 50 454 | | | — | | 1 228 | 359 038 | 28 567 | 388 833 | | | — | | — | — | 35 325 | 35 325 | | | — | | — | — | 461 636 | 461 636 | | | 2 719 270 | | 3 842 157 | 22 627 275 | 1 396 431 | 27 865 863 | | | | | | | | | | | — | | — | 1 968 896 | — | 1 968 896 | | | — | | 267 909 | — | — | 267 909 | | | — | | 16 242 | — | — | 16 242 | | | — | | — | 328 534 | — | 328 534 | | | — | | — | 19 952 173 | — | 19 952 173 | | | — | | — | 973 176 | — | 973 176 | | | — | | — | 455 892 | 166 075 | 621 967 | | | — | | 284 151 | 23 678 671 | 166 075 | 24 128 897 | | | — | | — | 682 218 | — | 682 218 | | | — | | 284 151 | 24 360 889 | 166 075 | 24 811 115 | | 168 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 13 . #### Analysis of financial assets and liabilities by category of financial instruments #### (continued) | | | | | | --- | --- | --- | --- | | | | | | | | At fair value through profit or loss | | | | | IFRS 9 mandatory | | | | At 31 March | Trading\* | Non–trading\* | Designated at initial recognition | | £’000 | | Company | | | | | 2024 | | | | | Assets | | | | | Cash and balances at central banks | — | — | — | | Loans and advances to banks | — | — | — | | Reverse repurchase agreements and cash collateral on securities borrowed | — | 164 319 | — | | Sovereign debt securities | — | — | — | | Bank debt securities | — | — | — | | Other debt securities | — | 59 421 | 1 064 | | Derivative financial instruments | 421 230 | — | — | | Securities arising from trading activities | 145 200 | 1 433 | 10 699 | | Loans and advances to customers | — | 561 435 | — | | Other loans and advances | — | 24 124 | — | | Other securitised assets | — | — | 468 | | Investment portfolio | — | 43 677 | — | | Interests in associated undertakings and joint venture holdings | — | — | — | | Current taxation assets | — | — | — | | Deferred taxation assets | — | — | — | | Other assets | 4 732 | — | — | | Property and equipment | — | — | — | | Investment in subsidiaries | — | — | — | | | 571 162 | 854 409 | 12 231 | | Liabilities | | | | | Deposits by banks | — | — | — | | Derivative financial instruments | 429 675 | — | — | | Other trading liabilities | 18 449 | — | — | | Repurchase agreements and cash collateral on securities lent | — | — | — | | Customer accounts (deposits) | — | — | — | | Debt securities in issue | — | — | 9 823 | | Other liabilities | — | — | — | | | 448 124 | — | 9 823 | | Subordinated liabilities | — | — | — | | | 448 124 | — | 9 823 | \*Fair value through profit and loss positions have been split as trading and non-trading, as defined by regulatory rules for the trading book and banking book requirements, respectively, other than derivatives, which are all classified as trading. Trading consists of positions held for trading intent or hedge elements of the trading book. For more information on hedges, please refer to note 49 on pages [222](#i447e4d363cd344738300acdd42f0e3a0_442) to [229](#ifc673f09145846e689b235b7346e602a_1630). 169 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | At fair value through comprehensive income | | | | | | | | | | | | | | | | Debt instrument with dual business model | | Total instruments at fair value | Amortised cost | Non-financial instruments or scoped out of IFRS 9 | Total | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | — | | — | 5 650 257 | — | 5 650 257 | | | — | | — | 290 068 | — | 290 068 | | | — | | 164 319 | 975 796 | — | 1 140 115 | | | 280 438 | | 280 438 | 796 986 | — | 1 077 424 | | | 247 263 | | 247 263 | 42 268 | — | 289 531 | | | 8 552 | | 69 037 | 1 346 193 | — | 1 415 230 | | | — | | 421 230 | — | — | 421 230 | | | — | | 157 332 | — | — | 157 332 | | | 1 471 371 | | 2 032 806 | 10 659 817 | — | 12 692 623 | | | — | | 24 124 | 3 287 684 | — | 3 311 808 | | | — | | 468 | | — | 468 | | | — | | 43 677 | — | — | 43 677 | | | — | | — | — | 781 674 | 781 674 | | | — | | — | — | 31 456 | 31 456 | | | — | | — | — | 58 572 | 58 572 | | | — | | 4 732 | 418 149 | 25 093 | 447 974 | | | — | | — | — | 45 716 | 45 716 | | | — | | — | — | 451 867 | 451 867 | | | 2 007 624 | | 3 445 426 | 23 467 218 | 1 394 378 | 28 307 022 | | | | | | | | | | | — | | — | 2 558 021 | — | 2 558 021 | | | — | | 429 675 | — | — | 429 675 | | | — | | 18 449 | — | — | 18 449 | | | — | | — | 235 447 | — | 235 447 | | | — | | — | 19 720 605 | — | 19 720 605 | | | — | | 9 823 | 945 871 | — | 955 694 | | | — | | — | 468 790 | 186 235 | 655 025 | | | — | | 457 947 | 23 928 734 | 186 235 | 24 572 916 | | | — | | — | 668 810 | — | 668 810 | | | — | | 457 947 | 24 597 544 | 186 235 | 25 241 726 | | 170 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy The table below analyses recurring fair value measurements for financial assets and financial liabilities. These fair value measurements are categorised into different levels in the fair value hierarchy based on the inputs to the valuation technique used. The different levels are identified as follows: Level 1 – quoted (unadjusted) prices in active markets for identical assets or liabilities. Level 2 – inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3 –inputs for the asset or liability that are not based on observable market data (unobservable inputs). | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Fair value category | | | | | At 31 March | Total instruments at fair value | | Level 1 | Level 2 | Level 3 | | | £’000 | | | | Group | | | | | | | | 2025 | | | | | | | | Assets | | | | | | | | Reverse repurchase agreements and cash collateral on securities borrowed | 56 413 | | — | 56 413 | — | | | Sovereign debt securities | 1 335 652 | | 1 335 652 | — | — | | | Bank debt securities | 324 179 | | 324 179 | — | — | | | Other debt securities | 58 513 | | 8 777 | 2 050 | 47 686 | | | Derivative financial instruments | 325 886 | | — | 319 534 | 6 352 | | | Securities arising from trading activities | 149 912 | | 149 912 | — | — | | | Loans and advances to customers\* | 2 577 237 | | — | 45 099 | 2 532 138 | | | Investment portfolio | 211 753 | | 935 | 962 | 209 856 | | | Other assets | 1 228 | | 1 228 | — | — | | | | 5 040 773 | | 1 820 683 | 424 058 | 2 796 032 | | | Liabilities | | | | | | | | Derivative financial instruments | 274 791 | | — | 273 964 | 827 | | | Other trading liabilities | 16 242 | | 16 242 | — | — | | | | 291 033 | | 16 242 | 273 964 | 827 | | | Net assets at fair value | 4 749 740 | | 1 804 441 | 150 094 | 2 795 205 | | \*Loans and advances to customers at fair value include instruments where the business model is either to sell the loan or where the business model is to hold to collect the contractual cash flows but the loan has failed the SPPI test. Transfers between level 1 and level 2 During the current and prior year there were no transfers between level 1 and level 2. 171 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | Fair value category | | | | At 31 March | Total instruments at fair value | | Level 1 | Level 2 | Level 3 | | £’000 | | | Group | | | | | | | 2024^ | | | | | | | Assets | | | | | | | Reverse repurchase agreements and cash collateral on securities borrowed | 164 319 | | — | 164 319 | — | | Sovereign debt securities | 993 289 | | 993 289 | — | — | | Bank debt securities | 247 263 | | 247 263 | — | — | | Other debt securities | 68 230 | | 8 552 | 65 | 59 613 | | Derivative financial instruments | 432 395 | | — | 421 825 | 10 570 | | Securities arising from trading activities | 157 332 | | 157 332 | — | — | | Loans and advances to customers\* | 2 112 568 | | — | 70 418 | 2 042 150 | | Other securitised assets | 66 702 | | — | — | 66 702 | | Investment portfolio | 244 140 | | 793 | 754 | 242 593 | | Other assets | 4 732 | | 4 732 | — | — | | | 4 490 970 | | 1 411 961 | 657 381 | 2 421 628 | | Liabilities | | | | | | | Derivative financial instruments | 409 255 | | — | 408 321 | 934 | | Other trading liabilities | 18 449 | | 18 449 | — | — | | Debt securities in issue | 9 823 | | — | 9 823 | — | | Liabilities arising on securitisation of other assets | 71 751 | | — | — | 71 751 | | | 509 278 | | 18 449 | 418 144 | 72 685 | | Net assets at fair value | 3 981 692 | | 1 393 512 | 239 237 | 2 348 943 | \*Loans and advances to customers at fair value include instruments where the business model is either to sell the loan or where the business model is to hold to collect the contractual cash flows but the loan has failed the SPPI test. ^Restated as detailed in note 57. Transfers between level 1 and level 2 During the current and prior year there were no transfers between level 1 and level 2. 172 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) Level 3 instruments The following table is a reconciliation of the opening balances to the closing balances for the fair value measurements in level 3 of the fair value hierarchy: | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | For the year to | Investment portfolio | Loans and advances to customers | Other securitised assets | Other balance sheet assets 1^ | | Total | | | £’000 | | | | Group | | | | | | | | | Assets | | | | | | | | | Balance as at 1 April 2023 | 309 067 | 1 303 646 | 78 231 | 111 460 | | 1 802 404 | | | Total gains or (losses) | (731) | 175 394 | (1 495) | 1 651 | | 174 819 | | | In the income statement | (731) | 177 180 | (1 495) | 1 651 | | 176 605 | | | In the statement of comprehensive income | — | (1 786) | — | — | | (1 786) | | | Purchases | 31 559 | 2 551 558 | — | 39 709 | | 2 622 826 | | | Sales | (75 323) | (1 058 680) | — | (14 481) | | (1 148 484) | | | Settlements | (18 352) | (898 422) | (10 034) | (74 870) | | (1 001 678) | | | Foreign exchange adjustments | (3 627) | (31 346) | — | 6 714 | | (28 259) | | | Balance as at 31 March 2024 | 242 593 | 2 042 150 | 66 702 | 70 183 | | 2 421 628 | | | Total gains or (losses) | 24 314 | 228 672 | 724 | 2 132 | | 255 842 | | | In the income statement | 24 314 | 209 554 | 724 | 2 132 | | 236 724 | | | In the statement of comprehensive income | — | 19 118 | — | — | | 19 118 | | | Purchases | 20 506 | 3 201 706 | — | 5 478 | | 3 227 690 | | | Sales | (9 340) | (1 166 693) | — | (421) | | (1 176 454) | | | Transfer to associated undertakings and joint venture holdings | (34 497) | — | — | — | | (34 497) | | | Settlements | (30 111) | (1 730 700) | (8 403) | (16 306) | | (1 785 520) | | | Deconsolidation of subsidiaries | — | — | (59 023) | (1 998) | | (61 021) | | | Transfers out of level 3 | — | (1 825) | — | — | | (1 825) | | | Foreign exchange adjustments | (3 609) | (41 172) | — | (5 030) | | (49 811) | | | Balance as at 31 March 2025 | 209 856 | 2 532 138 | — | 54 038 | | 2 796 032 | | 1.Comprises level 3 other debt securities, derivative financial instruments and securities arising from trading. ^Restated as detailed in note 57. The Group transfers between levels within the fair value hierarchy when the observability of inputs change, or if the valuation methods change. Transfers are deemed to occur at the end of each semi-annual reporting period. For the year to 31 March 2025, loans and advances to customers of £1.8 million were transferred from level 3 to level 2. In the prior year, there were no transfers into or from level 3. The valuation methodologies were reviewed and broker inputs were used to determine the fair value. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to | Liabilities arising on securitisation of other assets | Other balance sheet liabilities 2^ | Total | | | £’000 | | | Group | | | | | | Liabilities | | | | | | Balance as at 1 April 2023 | 81 609 | 6 832 | 88 441 | | | Total losses | 1 190 | 425 | 1 615 | | | In the income statement | 1 190 | 425 | 1 615 | | | Deconsolidation of subsidiaries | — | (3 933) | (3 933) | | | Settlements | (11 048) | (2 391) | (13 439) | | | Foreign exchange adjustments | — | 1 | 1 | | | Balance as at 31 March 2024 | 71 751 | 934 | 72 685 | | | Total losses | 311 | 29 | 340 | | | In the income statement | 311 | 29 | 340 | | | Settlements | (7 638) | — | (7 638) | | | Deconsolidation of subsidiaries | (64 424) | (136) | (64 560) | | | Balance as at 31 March 2025 | — | 827 | 827 | | 2Comprises level 3 derivative financial instruments and other liabilities. ^Restated as detailed in note 57. 173 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) The following table quantifies the gains or (losses) included in the income statement and other comprehensive income recognised on level 3 financial instruments: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | For the year to 31 March | Total | | Realised | Unrealised | | | £’000 | | | | Group | | | | | | | 2025 | | | | | | | Total gains or (losses) included in the income statement for the year | | | | | | | Net interest income\* | 213 436 | | 187 033 | 26 403 | | | Investment income\*\* | 23 689 | | (10 284) | 33 973 | | | Trading income arising from customer flow | (741) | | — | (741) | | | | 236 384 | | 176 749 | 59 635 | | | Total gains or (losses) included in other comprehensive income for the year | | | | | | | Gains on realisation on debt instruments at FVOCI recycled through the income statement | 268 | | 268 | — | | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income | 19 118 | | — | 19 118 | | | | 19 386 | | 268 | 19 118 | | | 2024^ | | | | | | | Total gains or (losses) included in the income statement for the year | | | | | | | Net interest income\* | 174 393 | | 156 766 | 17 627 | | | Investment income\*\* | 2 751 | | 31 331 | (28 580) | | | Trading loss arising from customer flow | (2 154) | | — | (2 154) | | | | 174 990 | | 188 097 | (13 107) | | | Total gains or (losses) included in other comprehensive income for the year | | | | | | | Gains on realisation on debt instruments at FVOCI recycled through the income statement | 534 | | 534 | — | | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income | (1 786) | | — | (1 786) | | | | (1 252) | | 534 | (1 786) | | ^Restated as detailed in note 57. \*Of the above gains, £210 million (2024: £172 million) relates to loans and advances to customers’ and the remainder relates to ‘other debt securities’. \*\*Of the above gains, £24.3 million (2024: £1.8 million) relates to ‘investment portfolio’ and the remainder relates to other asset and liability categories. 174 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) Level 2 financial assets and financial liabilities The following table sets out the Group’s principal valuation techniques as at 31 March 2025 used in determining the fair value of its financial assets and financial liabilities that are classified within level 2 of the fair value hierarchy: | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | VALUATION BASIS/TECHNIQUES | | MAIN INPUTS | | | Assets | | | | | | | | | | | | Reverse repurchase agreements and cash collateral on securities borrowed | | Discounted cash flow model | | Discount rates | | | | | | | | | | | | | | Other debt securities | | Discounted cash flow model | | Discount rates, swap curves and negotiable certificate of deposit curves, external prices and broker quotes | | | | | | | | | | | | | | Derivative financial instruments | | Discounted cash flow model, Hermite interpolation and industry standard derivative pricing models including Black- Scholes and Local Volatility | | Discount rate, risk-free rate, volatilities, forex forward points and spot rates, interest rate swap curves and credit curves | | | | | | | | | | | | | | Investment portfolio | | Discounted cash flow model and net asset value model | | Discount rate and net assets | | | | Comparable quoted inputs | | Discount rate and fund unit price | | | | | | | | Loans and advances to customers | | Discounted cash flow model | | Yield curves | | | | Broker inputs | | Broker quotes | | | | | | | | Liabilities | | | | | | | | | | | | Derivative financial instruments | | Discounted cash flow model, Hermite interpolation and industry standard derivative pricing models including Black- Scholes and Local Volatility | | Discount rate, risk-free rate, volatilities, forex forward points and spot rates, interest rate swap curves and credit curves | | | | | | | | | | | | | | Debt securities in issue | | Discounted cash flow model, Hermite interpolation and industry standard derivative pricing models including Local Volatility | | Discount rate, risk-free rate, volatilities, forex forward points and spot rates, interest rate swap curves and credit curves | | | | | | | 175 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) Sensitivity of fair values to reasonably possible alternative assumptions by level 3 instrument type The fair value of financial instruments in level 3 are measured using valuation techniques that incorporate assumptions that are not evidenced by prices from observable market data. The table below shows the sensitivity of these fair values to reasonably possible alternative assumptions, determined at a transactional level: Reasonable possible changes are determined depending on the nature of the instrument, for example, for credit related inputs, this is a one rating grade movement up or down. In other instances, the extent of a reasonable change is based on market experience. | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | At 31 March 2025 | Balance sheet value £’000 | Valuation technique | Significant unobservable input | Range of unobservable input used | Favourable changes £’000 | Unfavourable changes £’000 | | | Group | | | | | | | | | Assets | | | | | | | | | Other debt securities | 47 686 | | Potential impact on income statement | | 1 918 | (3 213) | | | | | Discounted cash flows | Credit spreads | 0.36%–1.5% | 57 | (105) | | | | | Discounted cash flows | Cash flow adjustments | CPR 13.94% | 256 | (164) | | | | | Underlying asset value | Underlying asset value | ^^ | 1 361 | (2 700) | | | | | Other | Other | ^ | 244 | (244) | | | | | | | | | | | | Derivative financial instruments | 6 352 | | Potential impact on income statement | | 1 058 | (702) | | | | Option pricing model | Volatilities | 7.5%–16.95% | — | (1) | | | | | Underlying asset value | Underlying asset value | ^^ | 1 | (3) | | | | | Other | Other | ^ | 1 057 | (698) | | | | | | | | | | | | Investment portfolio | 209 856 | | Potential impact on income statement | | 25 364 | (49 299) | | | | | Price earnings | Price earnings multiple | 1.6x–7.5x | 5 662 | (10 660) | | | | | Price earnings | Change in EBITDA | 3.3x–7.8x | 2 768 | (5 502) | | | | | Discounted cash flows | Discount rate | 10%–15% | 4 446 | (8 314) | | | | | Underlying asset value | Underlying asset value | ^^ | 9 320 | (18 487) | | | | | Other | Other | ^ | 3 168 | (6 336) | | | | | | | | | | | | Loans and advances to customers | 2 532 138 | | Potential impact on income statement | | 10 221 | (18 713) | | | | Discounted cash flows | Credit spreads | 0.14%–4.65% | 6 263 | (14 212) | | | | | Discounted cash flows | Credit spreads | 37.33% | 1 557 | (1 557) | | | | | Price earnings | Price earnings multiple | 4.5x | 675 | (1 101) | | | | | Underlying asset value | Underlying asset value | ^^ | 1 726 | (1 843) | | | | | | | | | | | | | | | Potential impact on other comprehensive income | | 17 712 | (32 737) | | | | | Discounted cash flows | Credit spreads | 0.16%–5.72% | 17 712 | (32 737) | | | | | | | | | | | | Total level 3 assets | 2 796 032 | | | | 56 273 | (104 664) | | | Liabilities | | | | | | | | | Derivative financial instruments | 827 | | Potential impact on income statement | | (12) | — | | | | Other | Other | ^ | (12) | — | | | | | | | | | | | | Total level 3 liabilities | 827 | | | | (12) | — | | | Net level 3 assets | 2 795 205 | | | | | | | ^Other – The valuation sensitivity has been assessed by adjusting various inputs such as net asset value and probability of recovery rather than a single input. It is deemed appropriate to reflect the outcome on a portfolio basis for the purposes of this analysis as the sensitivity of the assets cannot be determined through the adjustment of a single input. ^^Underlying asset values are calculated by reference to a tangible asset, for example, property, aircraft or shares. 176 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | At 31 March 2024 | Balance sheet value £’000 | Principle valuation technique | Significant unobservable input | Range of unobservable input used | Favourable changes £’000 | Unfavourable changes £’000 | | | Group | | | | | | | | | Assets | | | | | | | | | Other debt securities | 59 613 | | Potential impact on income statement | | 2 192 | (3 713) | | | | | Discounted cash flows | Credit spreads | 0.75%–0.86% | 40 | (68) | | | | | Discounted cash flows | Cash flow adjustments | CPR 7.62%–11.08% | 214 | (160) | | | | | Other | Other | ^ | 1 938 | (3 485) | | | | | | | | | | | | Derivative financial instruments# | 10 570 | | Potential impact on income statement | | 801 | (894) | | | | Option pricing model | Volatilities | 7.5%–19.1% | 1 | (3) | | | | Discounted cash flows | Cash flow adjustments | CPR 7.62%–11.08% | 2 | (2) | | | | Underlying asset value | Underlying asset value | ^^ | 46 | (93) | | | | Other | Other | ^ | 752 | (796) | | | | | | | | | | | | Investment portfolio | 242 593 | | Potential impact on income statement | | 24 640 | (48 475) | | | | | Price earnings | Price earnings multiple | 3.8x-9x | 6 485 | (13 200) | | | | | Discounted cash flows | Discount rate | 10.0% | 225 | (449) | | | | | Underlying asset value\* | Underlying asset value | ^^ | 4 546 | (8 120) | | | | | Other\* | Other | ^ | 13 383 | (26 706) | | | | | | | | | | | | Loans and advances to customers | 2 042 150 | | Potential impact on income statement | | 16 027 | (35 018) | | | | Discounted cash flows | Credit spreads | 0.16%–37.8% | 10 840 | (24 697) | | | | | Price earnings | Price earnings multiple | 3.8x | 2 762 | (6 893) | | | | | Underlying asset value | Underlying asset value | ^^ | 1 435 | (1 631) | | | | | Other | Other | ^ | 990 | (1 797) | | | | | | | | | | | | | | | Potential impact on other comprehensive income | | | | | | | | Discounted cash flows | Credit spreads | 0.14%–5.0% | 12 783 | (24 177) | | | | | | | | | | | | Other securitised assets | 66 702 | | Potential impact on income statement | | | | | | | Discounted cash flows | Cash flow adjustments | CPR 7.62% | 770 | (1 291) | | | | | | | | | | | | Total level 3 assets | 2 421 628 | | | | 57 212 | (113 568) | | | Liabilities | | | | | | | | | Derivative financial instruments# | 934 | | Potential impact on income statement | | (2) | 2 | | | | Option price model | Volatilities | 9%–23.3% | (1) | 2 | | | | | Other | Other | ^ | (1) | — | | | | | | | | | | | | Liabilities arising on securitisation of other assets | 71 751 | | Potential impact on income statement | | | | | | | Discounted cash flows | Cash flow adjustments | CPR 7.62% | (805) | 440 | | | | | | | | | | | | Total level 3 liabilities | 72 685 | | | | (807) | 442 | | | Net level 3 assets | 2 348 943 | | | | | | | #Restated as detailed in note 57. \*Due to the addition of valuation techniques into this disclosure, these lines have been disaggregated. ^Other – The valuation sensitivity has been assessed by adjusting various inputs such as net asset value and probability of recovery rather than a single input. It is deemed appropriate to reflect the outcome on a portfolio basis for the purposes of this analysis as the sensitivity of the assets cannot be determined through the adjustment of a single input. ^^Underlying asset values are calculated by reference to a tangible asset, for example, property, aircraft or shares. 177 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) In determining the value of level 3 financial instruments, the following are the principal inputs that can require judgement: Credit spreads Credit spreads reflect the additional yield that a market participant would demand for taking exposure to the credit risk of an instrument. The credit spread for an instrument forms part of the yield used in a discounted cash flow calculation. In general, a significant increase in a credit spread in isolation will result in a movement in fair value that is unfavourable for the holder of a financial instrument. It is an unobservable input into a discounted cash flow valuation. Discount rates Discount rates are used to adjust for the time value of money when using a discounted cash flow valuation method. Where relevant, the discount rate also accounts for illiquidity, market conditions and uncertainty of future cash flows. Volatilities Volatility is a key input in the valuation of derivative products containing optionality. Volatility is a measure of the variability or uncertainty in returns for a given derivative underlying. It represents an estimate of how much a particular underlying instrument, parameter or index will change in value over time. Cash flows Cash flows relate to the future cash flows that can be expected from the instrument and requires judgement. Cash flows are input into a discounted cash flow valuation. Price earnings multiple The price-to-earnings ratio is an equity valuation multiple used in the adjustment of underlying market prices. It is a key driver in the valuation of unlisted investments. Underlying asset value In instances where cash flows have links to referenced assets, the underlying asset value is used to determine the fair value. The underlying asset valuation is derived using observable market prices sourced from broker quotes, specialist valuers or other reliable pricing sources. 178 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Fair value category | | | | | At 31 March | Total instruments at fair value | | Level 1 | Level 2 | Level 3 | | | £’000 | | | | Company | | | | | | | | 2025 | | | | | | | | Assets | | | | | | | | Reverse repurchase agreements and cash collateral on securities borrowed | 56 413 | | — | 56 413 | — | | | Sovereign debt securities | 449 340 | | 449 340 | — | — | | | Bank debt securities | 324 179 | | 324 179 | — | — | | | Other debt securities | 57 888 | | 8 777 | 2 050 | 47 061 | | | Derivative financial instruments | 311 854 | | — | 305 502 | 6 352 | | | Securities arising from trading activities | 149 912 | | 149 912 | — | — | | | Loans and advances to customers\* | 2 449 856 | | — | 1 438 | 2 448 418 | | | Other loans and advances | 9 460 | | — | — | 9 460 | | | Investment portfolio | 32 027 | | — | 962 | 31 065 | | | Other assets | 1 228 | | 1 228 | — | — | | | | 3 842 157 | | 933 436 | 366 365 | 2 542 356 | | | Liabilities | | | | | | | | Derivative financial instruments | 267 909 | | — | 267 082 | 827 | | | Other trading liabilities | 16 242 | | 16 242 | — | — | | | | 284 151 | | 16 242 | 267 082 | 827 | | | Net assets at fair value | 3 558 006 | | 917 194 | 99 283 | 2 541 529 | | \*Loans and advances to customers at fair value include instruments where the business model is either to sell the loan or where the business model is to hold to collect the contractual cash flows but the loan has failed the SPPI test. Transfers between level 1 and level 2 During the current year and prior year there were no transfers between level 1 and level 2. 179 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14 . #### Fair value hierarchy #### (continued) | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Fair value category | | | | | At 31 March | Total instruments at fair value | | Level 1 | Level 2 | Level 3 | | | £’000 | | | | Company | | | | | | | | 2024 | | | | | | | | Assets | | | | | | | | Reverse repurchase agreements and cash collateral on securities borrowed | 164 319 | | — | 164 319 | — | | | Sovereign debt securities | 280 438 | | 280 438 | — | — | | | Bank debt securities | 247 263 | | 247 263 | — | — | | | Other debt securities | 69 037 | | 8 552 | 65 | 60 420 | | | Derivative financial instruments | 421 230 | | — | 413 245 | 7 985 | | | Securities arising from trading activities | 157 332 | | 157 332 | — | — | | | Loans and advances to customers\* | 2 032 806 | | — | — | 2 032 806 | | | Other securitised assets | 468 | | — | — | 468 | | | Other loans and advances | 24 124 | | — | — | 24 124 | | | Investment portfolio | 43 677 | | 35 | 754 | 42 888 | | | Other assets | 4 732 | | 4 732 | — | — | | | | 3 445 426 | | 698 352 | 578 383 | 2 168 691 | | | Liabilities | | | | | | | | Derivative financial instruments | 429 675 | | — | 407 673 | 22 002 | | | Other trading liabilities | 18 449 | | 18 449 | — | — | | | Debt securities in issue | 9 823 | | — | 9 823 | — | | | | 457 947 | | 18 449 | 417 496 | 22 002 | | | Net assets at fair value | 2 987 479 | | 679 903 | 160 887 | 2 146 689 | | \*Loans and advances to customers at fair value include instruments where the business model is either to sell the loan or where the business model is to hold to collect the contractual cash flows but the loan has failed the SPPI test. Transfers between level 1 and level 2 During the current year and prior year there were no transfers between level 1 and level 2. 180 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14 . #### Fair value hierarchy #### (continued) Level 3 instruments The following table is a reconciliation of the opening balances to the closing balances for the fair value measurements in level 3 of the fair value hierarchy: | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | For the year to | Investment portfolio | Loans and advances to customers | Other securitised assets | Other balance sheet assets 1 | Total | | | £’000 | | | Company | | | | | | | | Assets | | | | | | | | Balance as at 1 April 2023 | 45 125 | 1 293 046 | 4 005 | 109 083 | 1 451 259 | | | Total gains or (losses) | 138 | 176 062 | (3 537) | 3 405 | 176 068 | | | In the income statement | 138 | 177 848 | (3 537) | 3 405 | 177 854 | | | In the statement of comprehensive income | — | (1 786) | — | — | (1 786) | | | Purchases | 20 528 | 2 551 450 | — | 64 230 | 2 636 208 | | | Sales | (4 496) | (1 058 680) | — | (14 481) | (1 077 657) | | | Settlements | (17 716) | (898 105) | — | (76 886) | (992 707) | | | Foreign exchange adjustments | (691) | (30 967) | — | 7 178 | (24 480) | | | Balance as at 31 March 2024 | 42 888 | 2 032 806 | 468 | 92 529 | 2 168 691 | | | Total gains or (losses) | (1 798) | 228 566 | (157) | 4 156 | 230 767 | | | In the income statement | (1 798) | 209 448 | (157) | 4 156 | 211 649 | | | In the statement of comprehensive income | — | 19 118 | — | — | 19 118 | | | Purchases | 5 104 | 3 121 074 | — | 5 055 | 3 131 233 | | | Sales | — | (1 160 858) | (311) | (14 560) | (1 175 729) | | | Settlements | (14 469) | (1 730 700) | — | (18 716) | (1 763 885) | | | Transfers out of level 3 | — | (1 825) | — | — | (1 825) | | | Foreign exchange adjustments | (660) | (40 645) | — | (5 591) | (46 896) | | | Balance as at 31 March 2025 | 31 065 | 2 448 418 | — | 62 873 | 2 542 356 | | 1.Comprises level 3 other debt securities, derivative financial instruments, other loans and advances and securities arising from trading. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to | Derivative financial instruments | | Total | | | £’000 | | | | Company | | | | | | Liabilities | | | | | | Balance as at 1 April 2023 | 21 998 | | 21 998 | | | Total (gains) | (458) | | (458) | | | In the income statement | (458) | | (458) | | | Foreign exchange adjustments | 462 | | 462 | | | Balance as at 31 March 2024 | 22 002 | | 22 002 | | | Total (gains) | 48 | | 48 | | | In the income statement | 48 | | 48 | | | Settlements | (21 223) | | (21 223) | | | Balance as at 31 March 2025 | 827 | | 827 | | The Group transfers between levels within the fair value hierarchy when the observability of inputs change, or if the valuation methods change. Transfers are deemed to occur at the end of each semi-annual reporting period. For the year to 31 March 2025, loans and advances to customers of £1.8 million were transferred from level 3 to level 2. In the prior year, there were no transfers into or from level 3. The valuation methodologies were reviewed and broker inputs were used to determine the fair value. 181 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) The following table quantifies the gains or (losses) included in the income statement and other comprehensive income recognised on level 3 financial instruments: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | For the year to 31 March | Total | | Realised | Unrealised | | | £’000 | | | | Company | | | | | | | 2025 | | | | | | | Total gains or (losses) included in the income statement for the period | | | | | | | Net interest income\* | 214 732 | | 188 431 | 26 301 | | | Investment income | (2 387) | | (10 060) | 7 673 | | | Trading income arising from customer flow | (744) | | | (744) | | | | 211 601 | | 178 371 | 33 230 | | | Total gains or (losses) included in other comprehensive income for the period | | | | | | | Gains on realisation on debt instruments at FVOCI recycled through the income statement | 268 | | 268 | — | | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income | 19 118 | | — | 19 118 | | | | 19 386 | | 268 | 19 118 | | | 2024 | | | | | | | Total gains or (losses) included in the income statement for the period | | | | | | | Net interest income\* | 177 923 | | 157 749 | 20 174 | | | Investment income | 1 617 | | 8 558 | (6 941) | | | Trading loss arising from customer flow | (2 143) | | | (2 143) | | | | 177 397 | | 166 307 | 11 090 | | | Total gains or (losses) included in other comprehensive income for the period | | | | | | | Gains on realisation on debt instruments at FVOCI recycled through the income statement | 534 | | 534 | — | | | Fair value movements on debt instruments at FVOCI taken directly to other comprehensive income | (1 786) | | — | (1 786) | | | | (1 252) | | 534 | (1 786) | | \*Of the above gains, £210 million (2024: £172 million) relates to loans and advances to customers’ and the remainder relates to ‘other debt securities’. Level 2 financial assets and financial liabilities The Company follows the Group’s principal valuation techniques set out on page [174](#ibc74952f1eac4c12b4271f76ac007cbb_6806) in determining the fair value of its financial assets and financial liabilities that are classified within level 2 of the fair value hierarchy. 182 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) Sensitivity of fair values to reasonably possible alternative assumptions by level 3 instrument type The fair value of financial instruments in level 3 are measured using valuation techniques that incorporate assumptions that are not evidenced by prices from observable market data. The table below shows the sensitivity of these fair values to reasonably possible alternative assumptions, determined at a transactional level: | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | At 31 March 2025 | Balance sheet value £’000 | Principle valuation technique | Significant unobservable input | Range of unobservable input used | Favourable changes £’000 | Unfavourable changes £’000 | | | Company | | | | | | | | | Assets | | | | | | | | | Other debt securities | 47 061 | | Potential impact on income statement | | 1 914 | (3 205) | | | | | Discounted cash flows | Credit spreads | 0.36%–1.5% | 53 | (97) | | | | | Discounted cash flows | Cash flow adjustments | CPR 13.94% | 256 | (164) | | | | | Underlying asset value | Underlying asset value^^ | ^^ | 1 361 | (2 700) | | | | | Other | Other | ^ | 244 | (244) | | | | | | | | | | | | Derivative financial instruments | 6 352 | | Potential impact on income statement | | 1 058 | (702) | | | | Option pricing model | Volatilities | 7.5%–16.95% | — | (1) | | | | | Underlying asset value | Underlying asset value | ^^ | 1 | (3) | | | | | Other | Other | ^ | 1 057 | (698) | | | | | | | | | | | | Investment portfolio | 31 065 | | Potential impact on income statement | | 3 132 | (6 607) | | | | | Discounted cash flows | Discount rate | 15% | 44 | (82) | | | | | Underlying asset value | Underlying asset value | ^^ | 2 561 | (5 470) | | | | | Other | Other | ^ | 527 | (1 055) | | | | | | | | | | | | Loans and advances to customers | 2 448 418 | | Potential impact on income statement | | 9 141 | (16 798) | | | | Discounted cash flows | Credit spreads | 0.14%–4.65% | 6 068 | (13 818) | | | | Discounted cash flows | Credit spreads | 37.33% | 1 557 | (1 557) | | | | Underlying asset value | Underlying asset value | ^^ | 1 516 | (1 423) | | | | | | | | | | | | | Potential impact on other comprehensive income | | | | | | | Discounted cash flows | Credit spreads | 0.16%–5.72% | 15 653 | (28 974) | | | | | | | | | | | | Other loans and advances | 9 460 | | Potential impact on income statement | | 711 | — | | | | | Other | Other^ | ^ | 711 | — | | | | | | | | | | | | Total level 3 assets | 2 542 356 | | | | 31 609 | (56 286) | | | Liabilities | | | | | | | | | Derivative financial instruments | 827 | | Potential impact on income statement | | (12) | — | | | | | Other | Other | ^ | (12) | — | | | | | | | | | | | | Total level 3 liabilities | 827 | | | | (12) | — | | | Net level 3 assets | 2 541 529 | | | | | | | ^Other – The valuation sensitivity has been assessed by adjusting various inputs such as net asset value and probability of recovery rather than a single input. It is deemed appropriate to reflect the outcome on a portfolio basis for the purposes of this analysis as the sensitivity of the assets cannot be determined through the adjustment of a single input. ^^Underlying asset values are calculated by reference to a tangible asset, for example, property, aircraft or shares. 183 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 14. #### Fair value hierarchy #### (continued) | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | At 31 March 2024 | Balance sheet value £’000 | Principle valuation technique | Significant unobservable input | Range of unobservable input used | Favourable changes £’000 | Unfavourable changes £’000 | | | Company | | | | | | | | | Assets | | | | | | | | | Other debt securities | 60 420 | | Potential impact on income statement | | 2 214 | (3 720) | | | | | Discounted cash flows | Credit spreads | 0.75%–0.86% | 39 | (66) | | | | | Discounted cash flows | Cash flow adjustments | CPR 7.62%–11.08% | 237 | (169) | | | | | Other | Other | ^ | 1 938 | (3 485) | | | | | | | | | | | | Derivative financial instruments | 7 985 | | Potential impact on income statement | | 799 | (891) | | | | | Option pricing model | Volatilities | 7.5%–19.1% | 1 | (3) | | | | | Underlying asset value | Underlying asset value | ^^ | 46 | (93) | | | | | Other | Other | ^ | 752 | (795) | | | | | | | | | | | | Investment portfolio | 42 888 | | Potential impact on income statement | | 4 372 | (8 969) | | | | | Underlying asset value\* | Underlying asset value | ^^ | 1 605 | (3 436) | | | | | Other\* | Other | ^ | 2 767 | (5 533) | | | | | | | | | | | | Loans and advances to customers | 2 032 806 | | Potential impact on income statement | | 13 070 | (27 734) | | | | Discounted cash flows | Credit spreads | 0.16%–37.8% | 10 840 | (24 697) | | | | Underlying asset value | Underlying asset value | ^^ | 1 240 | (1 240) | | | | Other | Other | ^ | 990 | (1 797) | | | | | Potential impact on other comprehensive income | | | | | | | Discounted cash flows | Credit spreads | 0.14%–5.0% | 12 783 | (24 177) | | | | | | | | | | | | Other securitised assets | 468 | | Potential impact on income statement | | | | | | | | Discounted cash flows | Cash flow adjustments | CPR 11.08% | 317 | (468) | | | | | | | | | | | | Other loans and advances | 24 124 | | Potential impact on income statement | | | | | | | | Other | Other | ^ | 96 | (1 906) | | | | | | | | | | | | Total level 3 assets | 2 168 691 | | | | 33 651 | (67 865) | | | Liabilities | | | | | | | | | Derivative financial instruments | 22 002 | | Potential impact on income statement | | (316) | (654) | | | | | Discounted cash flows | Discount rate | 10.93%–13.1% | (314) | (652) | | | | | Option pricing model | Volatilities | 9%–22.3% | (1) | (2) | | | | | Other | Other | ^ | (1) | — | | | | | | | | | | | | Total level 3 liabilities | 22 002 | | | | (316) | (654) | | | Net level 3 assets | 2 146 689 | | | | | | | \*Due to the addition of valuation techniques into this disclosure, these lines have been disaggregated. ^Other – The valuation sensitivity has been assessed by adjusting various inputs such as net asset value and probability of recovery rather than a single input. It is deemed appropriate to reflect the outcome on a portfolio basis for the purposes of this analysis as the sensitivity of the assets cannot be determined through the adjustment of a single input. ^^Underlying asset values are calculated by reference to a tangible asset, for example, property, aircraft or shares. 184 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 15. #### Fair value of financial instruments at amortised cost | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Level within the fair value hierarchy | | | | | At 31 March | Carrying amount | Fair value approximates carrying amount | Balances where fair values do not approximate carrying amounts | Fair value of balances that do not approximate carrying amounts | | Level 1 | Level 2 | Level 3 | | | £’000 | | | | Group | | | | | | | | | | | 2025 | | | | | | | | | | | Assets | | | | | | | | | | | Cash and balances at central banks | 4 191 750 | 4 191 750 | — | — | | — | — | — | | | Loans and advances to banks | 859 802 | 859 802 | — | — | | — | — | — | | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 584 352 | 1 318 407 | 265 945 | 266 404 | | — | 266 404 | — | | | Sovereign debt securities | 1 189 050 | 421 866 | 767 184 | 767 504 | | 767 504 | — | — | | | Other debt securities | 712 209 | 75 979 | 636 230 | 629 936 | | — | 629 936 | — | | | Loans and advances to customers | 14 236 486 | 564 094 | 13 672 392 | 13 643 949 | | — | 1 006 893 | 12 637 056 | | | Other loans and advances | 162 882 | 114 694 | 48 188 | 48 164 | | — | 48 164 | — | | | Other assets | 380 319 | 380 319 | — | — | | — | — | — | | | | 23 316 850 | 7 926 911 | 15 389 939 | 15 355 957 | | | | | | | Liabilities | | | | | | | | | | | Deposits by banks | 1 477 568 | 201 160 | 1 276 408 | 1 282 354 | | — | 1 282 354 | — | | | Repurchase agreements and cash collateral on securities lent | 178 202 | 178 202 | — | — | | — | — | — | | | Customer accounts (deposits) | 21 555 444 | 13 573 368 | 7 982 076 | 7 949 847 | | — | 7 949 847 | — | | | Debt securities in issue | 974 371 | 1 194 | 973 177 | 980 488 | | 848 810 | 131 678 | — | | | Other liabilities | 509 303 | 508 621 | 682 | 189 | | — | — | 189 | | | Subordinated liabilities | 682 218 | — | 682 218 | 712 548 | | 712 548 | — | — | | | | 25 377 106 | 14 462 545 | 10 914 561 | 10 925 426 | | | | | | For the year ended 31 March 2025 , there were insignificant disposals of financial instruments measured at amortised cost. For financial assets and financial liabilities that are liquid or have a short-term maturity (less than three months) it is assumed that the carrying amounts approximate their fair value. These assets and liabilities include demand deposits, savings accounts without a specific maturity, which are included in customer accounts (deposits), and variable rate instruments. Financial instruments for which fair value does not approximate carrying value Differences in amortised cost and fair value occur in fixed rate instruments. The fair value of fixed rate financial assets and financial liabilities carried at amortised cost are estimated by comparing spreads earned on the transactions with spreads earned on similar new transactions entered into by the Group. The estimated fair value of fixed interest-bearing deposits is based on discounted cash flows, using prevailing money market interest rates for debts with similar credit risk and maturity. For quoted subordinated debt issued, the fair values are calculated based on quoted market prices. For those notes issued where quoted market prices are not available, a discounted cash flow model is used based on a current interest rate yield curve appropriate for the remaining term to maturity. 185 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 15. #### Fair value of financial instruments at amortised cost #### (continued) | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Level within the fair value hierarchy | | | | | At 31 March | Carrying amount | Fair value approximates carrying amount | Balances where fair values do not approximate carrying amounts | Fair value of balances that do not approximate carrying amounts | | Level 1 | Level 2 | Level 3 | | | £’000 | | | | Group | | | | | | | | | | | 2024 | | | | | | | | | | | Assets | | | | | | | | | | | Cash and balances at central banks | 5 661 623 | 5 661 623 | — | — | | — | — | — | | | Loans and advances to banks | 676 001 | 676 001 | — | — | | — | — | — | | | Reverse repurchase agreements and cash collateral on securities borrowed | 975 796 | 904 973 | 70 823 | 70 775 | | — | 70 775 | — | | | Sovereign debt securities | 934 845 | 4 253 | 930 592 | 930 937 | | 930 937 | — | — | | | Bank debt securities | 49 992 | — | 49 992 | 50 432 | | 50 432 | — | — | | | Other debt securities | 640 055 | 26 958 | 613 097 | 614 800 | | — | 614 800 | — | | | Loans and advances to customers | 14 457 745 | 542 986 | 13 914 759 | 13 715 487 | | — | 982 824 | 12 732 663 | | | Other loans and advances | 145 545 | 99 497 | 46 048 | 46 167 | | — | 46 167 | — | | | Other assets | 450 714 | 450 714 | — | — | | — | — | — | | | | 23 992 316 | 8 367 005 | 15 625 311 | 15 428 598 | | | | | | | Liabilities | | | | | | | | | | | Deposits by banks | 2 174 305 | 271 520 | 1 902 785 | 1 917 265 | | — | 1 917 265 | — | | | Repurchase agreements and cash collateral on securities lent | 85 091 | 85 091 | — | — | | — | — | — | | | Customer accounts (deposits) | 20 851 216 | 10 018 541 | 10 832 675 | 10 810 561 | | — | 10 810 561 | — | | | Debt securities in issue | 947 064 | 1 194 | 945 870 | 951 478 | | 665 266 | 286 212 | — | | | Other liabilities | 557 111 | 555 484 | 1 627 | 536 | | — | — | 536 | | | Subordinated liabilities | 668 810 | — | 668 810 | 661 143 | | 661 143 | — | — | | | | 25 283 597 | 10 931 830 | 14 351 767 | 14 340 983 | | | | | | For the year ended 31 March 2024, there were insignificant disposals of financial instruments measured at amortised cost. 186 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 15. #### Fair value of financial instruments at amortised cost #### (continued) Fixed rate financial instruments The fair value of fixed rate financial assets and financial liabilities carried at amortised cost are estimated by comparing spreads earned on the transactions with spreads earned on similar new transactions entered into by the Group. The estimated fair value of fixed interest-bearing deposits is based on discounted cash flows, using prevailing money market interest rates for debts with similar credit risk and maturity. For quoted subordinated debt issued, the fair values are calculated based on quoted market prices. For those notes issued where quoted market prices are not available, a discounted cash flow model is used based on a current interest rate yield curve appropriate for the remaining term to maturity. Certain financial instruments that would normally be carried at fair value continue to be recognised at transaction price. This occurs when the fair value would normally be determined using valuation techniques which cannot be relied on due to insufficient external inputs. This results in gains or losses which have not been recognised on-balance sheet. The following table sets out the Group’s principal level 2 and 3 valuation techniques used in determining the fair value of its financial assets and financial liabilities: | | | | | --- | --- | --- | | | | | | Other debt securities | | Priced with reference to similar trades in an observable market. | | Reverse repurchase agreements and cash collateral on securities borrowed | | Calculation of the present value of future cash flows, discounted as appropriate. | | Loans and advances to customers | | Calculation of the present value of future cash flows, discounted as appropriate. | | Other loans and advances | | Calculation of the present value of future cash flows, discounted as appropriate. | | Deposits by banks | | Calculation of fair value using appropriate funding rates. | | Customer accounts (deposits) | | Where the deposits are short-term in nature, carrying amounts are assumed to approximate fair value. Where deposits are of longer-term maturities, they are valued using a cash flow model discounted as appropriate. | | Debt securities in issue | | Where the debt securities are fully collateralised, fair value is equal to the carrying value. Other debt securities are valued using a cash flow model discounted as appropriate to the securities for funding and interest rates. | | Other liabilities | | Where the other liabilities are short-term in nature, carrying amounts are assumed to approximate fair value. | 187 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 15. #### Fair value of financial instruments at amortised cost #### (continued) | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Level within the fair value hierarchy | | | | | At 31 March | Carrying amount | Fair value approximates carrying amount | Balances where fair values do not approximate carrying amounts | Fair value of balances that do not approximate carrying amounts | | Level 1 | Level 2 | Level 3 | | | £’000 | | | | Company | | | | | | | | | | | 2025 | | | | | | | | | | | Assets | | | | | | | | | | | Cash and balances at central banks | 4 175 092 | 4 175 092 | — | — | | — | — | — | | | Loans and advances to banks | 450 989 | 450 989 | — | — | | — | — | — | | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 584 352 | 1 318 407 | 265 945 | 266 404 | | — | 266 404 | — | | | Sovereign debt securities | 1 045 860 | 417 699 | 628 161 | 628 112 | | 628 112 | — | — | | | Other debt securities | 1 337 273 | 701 043 | 636 230 | 629 936 | | — | 629 936 | — | | | Loans and advances to customers | 10 343 625 | 304 871 | 10 038 754 | 10 019 795 | | — | — | 10 019 795 | | | Other loans and advances | 3 331 046 | 3 282 858 | 48 188 | 48 164 | | — | 48 164 | — | | | Other assets | 359 038 | 359 038 | — | — | | — | — | — | | | | 22 627 275 | 11 009 997 | 11 617 278 | 11 592 411 | | | | | | | Liabilities | | | | | | | | | | | Deposits by banks | 1 968 896 | 692 487 | 1 276 409 | 1 282 354 | | — | 1 282 354 | — | | | Repurchase agreements and cash collateral on securities lent | 328 534 | 328 534 | — | — | | — | — | — | | | Customer accounts (deposits) | 19 952 173 | 12 323 683 | 7 628 490 | 7 595 233 | | — | 7 595 233 | — | | | Debt securities in issue | 973 176 | — | 973 176 | 980 488 | | 848 810 | 131 678 | — | | | Other liabilities | 455 892 | 455 209 | 683 | 189 | | — | — | 189 | | | Subordinated liabilities | 682 218 | — | 682 218 | 712 548 | | 712 548 | — | — | | | | 24 360 889 | 13 799 913 | 10 560 976 | 10 570 812 | | | | | | For the year ended 31 March 2025 , there were insignificant disposals of financial instruments measured at amortised cost. For financial assets and financial liabilities that are liquid or have a short-term maturity (less than three months) it is assumed that the carrying amounts approximate their fair value. These assets and liabilities include demand deposits, savings accounts without a specific mat urity, which are included in customer accounts (deposits), and variable rate instruments. Financial instruments for which fair value does not approximate carrying value Differences in amortised cost and fair value occur in fixed rate instruments. The fair value of fixed rate financial assets and financial liabilities carried at amortised cost are estimated by comparing spreads earned on the transactions with spreads earned on similar new transactions entered into by the Group. The estimated fair value of fixed interest-bearing deposits is based on discounted cash flows, using prevailing money market interest rates for debts with similar credit risk and maturity. For quoted subordinated debt issued, the fair values are calculated based on quoted market prices. For those notes issued where quoted market prices are not available, a discounted cash flow model is used based on a current interest rate yield curve appropriate for the remaining term to maturity. 188 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 15. #### Fair value of financial instruments at amortised cost #### (continued) | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Level within the fair value hierarchy | | | | | At 31 March | Carrying amount | Fair value approximates carrying amount | Balances where fair values do not approximate carrying amounts | Fair value of balances that do not approximate carrying amounts | | Level 1 | Level 2 | Level 3 | | | £’000 | | | | Company | | | | | | | | | | | 2024 | | | | | | | | | | | Assets | | | | | | | | | | | Cash and balances at central banks | 5 650 257 | 5 650 257 | — | — | | | — | — | | | Loans and advances to banks | 290 068 | 290 068 | — | — | | — | — | — | | | Reverse repurchase agreements and cash collateral on securities borrowed | 975 796 | 904 973 | 70 823 | 70 775 | | — | 70 775 | — | | | Sovereign debt securities | 796 986 | — | 796 986 | 797 057 | | 797 057 | — | — | | | Bank debt securities | 42 268 | — | 42 268 | 42 785 | | 42 785 | — | — | | | Other debt securities | 1 346 193 | 733 095 | 613 098 | 614 800 | | — | 614 800 | — | | | Loans and advances to customers | 10 659 817 | 272 526 | 10 387 291 | 10 255 527 | | — | — | 10 255 527 | | | Other loans and advances | 3 287 684 | 3 241 637 | 46 047 | 46 167 | | — | 46 167 | — | | | Other assets | 418 149 | 418 149 | — | — | | — | — | — | | | | 23 467 218 | 11 510 705 | 11 956 513 | 11 827 111 | | | | | | | Liabilities | | | | | | | | | | | Deposits by banks | 2 558 021 | 655 236 | 1 902 785 | 1 917 265 | | — | 1 917 265 | — | | | Repurchase agreements and cash collateral on securities lent | 235 447 | 235 447 | — | — | | — | — | — | | | Customer accounts (deposits) | 19 720 605 | 9 219 020 | 10 501 585 | 10 479 003 | | — | 10 479 003 | — | | | Debt securities in issue | 945 871 | — | 945 871 | 951 478 | | 665 266 | 286 212 | — | | | Other liabilities | 468 790 | 467 163 | 1 627 | 536 | | — | — | 536 | | | Subordinated liabilities | 668 810 | — | 668 810 | 661 143 | | 661 143 | — | — | | | | 24 597 544 | 10 576 866 | 14 020 678 | 14 009 425 | | | | | | For the year ended 31 March 2024, there were insignificant disposals of financial instruments measured at amortised cost. 189 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 16. #### Designated at fair value | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Fair value adjustment | | Change in fair value attributable to credit risk \* | | | | | At 31 March | Carrying value | Current | Cumulative | Current | Cumulative | Maximum exposure to credit risk | | | £’000 | | | Group | | | | | | | | | Assets | | | | | | | | | 2024 | | | | | | | | | Securities arising from trading activities# | 10 699 | 529 | 1 753 | (98) | (161) | 10 699 | | | Other securitised assets^ | 66 702 | (2 747) | (12 648) | (2 747) | (12 648) | 66 702 | | | | 77 401 | (2 218) | (10 895) | (2 845) | (12 809) | 77 401 | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | Fair value adjustment | | Change in fair value attributable to credit risk\* | | | | At 31 March | Carrying value | Remaining contractual amount to be repaid at maturity | Current | Cumulative | Current | Cumulative | | | £’000 | | | Liabilities | | | | | | | | | 2024 | | | | | | | | | Debt securities in issue# | 9 823 | 9 969 | 79 | 2 217 | (106) | (160) | | | Liabilities arising on securitisation of other assets^ | 71 751 | 77 152 | 567 | (4 350) | 567 | (4 350) | | | | 81 574 | 87 121 | 646 | (2 133) | 461 | (4 510) | | \*Changes in fair value due to credit risk are determined as the change in the fair value of the financial instrument that is not attributable to changes in other market inputs. ^During the year, the Group sold a residual tranche holding in Landmark Mortgage Securities No. 2 plc structured entity which subsequently resulted in the deconsolidation of the SPV and its related assets and liabilities. #During the year, all of the debt securities designated at fair value in the Financial Product's collateralised note issuance programme matured and the corresponding bond positions were sold and hence the balances for 2025 are £nil. 190 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 16 . #### Designated at fair value #### (continued) | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Fair value adjustment | | Change in fair value attributable to credit risk \* | | | | | At 31 March | Carrying value | Current | Cumulative | Current | Cumulative | Maximum exposure to credit risk | | | £’000 | | | Company | | | | | | | | | Assets | | | | | | | | | 2024 | | | | | | | | | Other debt securities^ | 1 064 | — | 1 064 | — | 1 064 | 1 064 | | | Securities arising from trading activities# | 10 699 | 529 | 1 753 | (98) | (161) | 10 699 | | | Other securitised assets^ | 468 | (3 537) | 469 | (3 537) | 469 | 469 | | | | 12 231 | (3 008) | 3 286 | (3 635) | 1 372 | 12 232 | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | Fair value adjustment | | Change in fair value attributable to credit risk \* | | | | At 31 March | Carrying value | Remaining contractual amount to be repaid at maturity | Current | Cumulative | Current | Cumulative | | | £’000 | | | 2024 | | | | | | | | | Debt securities in issue# | 9 823 | 9 969 | 79 | 2 217 | (106) | (160) | | | | 9 823 | 9 969 | 79 | 2 217 | (106) | (160) | | \*Changes in fair value due to credit risk are determined as the change in the fair value of the financial instrument that is not attributable to changes in other market inputs. ^During the year, the Group sold a residual tranche holding in Landmark Mortgage Securities No. 2 plc structured entity which subsequently resulted in the deconsolidation of the SPV and its related assets and liabilities. #During the year, all of the debt securities designated at fair value in the Financial Product's collateralised note issuance programme matured and the corresponding bond positions were sold and hence the balances for 2025 are £nil. 191 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 17. #### Cash and balances at central banks | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Gross cash and balances at central banks | 4 191 750 | | 5 661 623 | | 4 175 092 | | 5 650 257 | | | Expected credit loss | — | | — | | — | | — | | | Net cash and balances at central banks | 4 191 750 | | 5 661 623 | | 4 175 092 | | 5 650 257 | | | The country risk of cash and bank balances at central banks lies in the following geographies: | | | | | | | | | | United Kingdom | 4 175 093 | | 5 650 258 | | 4 175 092 | | 5 650 257 | | | Europe (excluding UK) | 16 657 | | 11 365 | | — | | — | | | | 4 191 750 | | 5 661 623 | | 4 175 092 | | 5 650 257 | | 18. #### Loans and advances to banks | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024^ | | | £’000 | | | | | | Gross loans and advances to banks | 859 831 | | 676 024 | | 450 992 | | 290 071 | | | Expected credit loss | (29) | | (23) | | (3) | | (3) | | | Net loans and advances to banks | 859 802 | | 676 001 | | 450 989 | | 290 068 | | | The country risk of loans and advances to banks lies in the following geographies: | | | | | | | | | | South Africa | 2 206 | | 2 074 | | 836 | | 605 | | | United Kingdom | 327 036 | | 309 774 | | 105 587 | | 89 638 | | | Europe (excluding UK) | 408 603 | | 266 415 | | 244 885 | | 123 800 | | | Australia | 17 548 | | 9 617 | | 11 402 | | 5 766 | | | North America | 95 462 | | 77 740 | | 81 908 | | 66 204 | | | Asia | 8 474 | | 10 108 | | 5 905 | | 3 785 | | | Other | 473 | | 273 | | 466 | | 270 | | | | 859 802 | | 676 001 | | 450 989 | | 290 068 | | ^The prior year Company risk disclosure for balances with Group companies of £31.3 million has been corrected to present under Europe rather than South Africa. 192 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 19. Reverse repurchase agreements and cash collateral on securities borrowed and repurchase agreements and cash collateral on securities lent | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Assets | | | | | | | | | | Gross reverse repurchase agreements and cash collateral on securities borrowed | 1 640 780 | | 1 140 129 | | 1 640 780 | | 1 140 129 | | | Expected credit loss | (15) | | (14) | | (15) | | (14) | | | Net reverse repurchase agreements and cash collateral on securities borrowed | 1 640 765 | | 1 140 115 | | 1 640 765 | | 1 140 115 | | | Reverse repurchase agreements | 1 630 578 | | 1 131 175 | | 1 630 578 | | 1 131 175 | | | Cash collateral on securities borrowed | 10 187 | | 8 940 | | 10 187 | | 8 940 | | | | 1 640 765 | | 1 140 115 | | 1 640 765 | | 1 140 115 | | | As part of the reverse repurchase and securities borrowing agreements, the Group has received securities that it is allowed to sell or repledge. £10 million ( 2024: £59 million) has been resold or repledged to third parties in connection with financing activities or to comply with commitments under short sale transactions. | | | | | | | | | | Liabilities | | | | | | | | | | Repurchase agreements | 169 708 | | 67 521 | | 320 040 | | 217 876 | | | Cash collateral on securities lent | 8 494 | | 17 570 | | 8 494 | | 17 571 | | | | 178 202 | | 85 091 | | 328 534 | | 235 447 | | The assets transferred and not derecognised in the above repurchase agreements are fair valued at £207 million ( 2024 : £86 million). They are pledged as security for the term of the underlying repurchase agreement. 193 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 20. #### Sovereign debt securities | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Gross sovereign debt securities | 2 524 702 | | 1 928 134 | | 1 495 200 | | 1 077 424 | | | Expected credit loss | — | | | | — | | | | | Net sovereign debt securities | 2 524 702 | | 1 928 134 | | 1 495 200 | | 1 077 424 | | | The country risk of sovereign debt securities lies in the following geographies: | | | | | | | | | | United Kingdom | 1 377 860 | | 1 108 907 | | 1 037 398 | | 825 216 | | | Europe (excluding UK)\* | 239 778 | | 136 269 | | 158 257 | | 51 193 | | | North America | 907 064 | | 682 958 | | 299 545 | | 201 015 | | | | 2 524 702 | | 1 928 134 | | 1 495 200 | | 1 077 424 | | \*Where Europe (excluding UK) largely includes securities held in Germany and Switzerland. 21. #### Bank debt securities | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | Group | | | Company | | | | At 31 March | 2025 | | 2024 | 2025 | 2024 | | | £’000 | | | Gross bank debt securities | 324 179 | | 297 257 | 324 179 | 289 533 | | | Expected credit loss | — | | (2) | — | (2) | | | Net bank debt securities | 324 179 | | 297 255 | 324 179 | 289 531 | | | Bonds | 324 179 | | 297 255 | 324 179 | 289 531 | | | | 324 179 | | 297 255 | 324 179 | 289 531 | | | The country risk of bank debt securities lies in the following geographies: | | | | | | | | United Kingdom | 257 401 | | 188 179 | 257 401 | 188 179 | | | Europe (excluding UK) | — | | 43 935 | — | 36 211 | | | Australia | 51 663 | | 33 476 | 51 663 | 33 476 | | | North America | 15 115 | | 31 665 | 15 115 | 31 665 | | | | 324 179 | | 297 255 | 324 179 | 289 531 | | 22. #### Other debt securities | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024^ | | | £’000 | | | | | | Gross other debt securities | 771 481 | | 708 689 | | 1 395 920 | | 1 415 634 | | | Expected credit loss | (759) | | (404) | | (759) | | (404) | | | Net other debt securities | 770 722 | | 708 285 | | 1 395 161 | | 1 415 230 | | | Bonds | 69 830 | | 88 189 | | 69 205 | | 87 932 | | | Asset-backed securities | 700 892 | | 620 096 | | 1 325 956 | | 1 327 298 | | | | 770 722 | | 708 285 | | 1 395 161 | | 1 415 230 | | | The country risk of other debt securities lies in the following geographies: | | | | | | | | | | United Kingdom | 60 111 | | 73 161 | | 685 176 | | 780 363 | | | Europe (excluding UK) | 91 867 | | 95 957 | | 91 867 | | 95 957 | | | North America | 600 762 | | 515 335 | | 600 762 | | 515 335 | | | Asia | 17 982 | | 23 832 | | 17 356 | | 23 575 | | | | 770 722 | | 708 285 | | 1 395 161 | | 1 415 230 | | ^The prior year Company investment in securitised receivables of £706 million has been corrected to present under Asset-backed securities rather than Bonds. 194 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 23. #### Derivative financial instruments The Group enters into various contracts for derivatives, both as principal for trading purposes and as a customer for hedging foreign exchange and interest rate exposures. These include financial futures, options, swaps and forward rate agreements. The risks associated with derivative instruments are monitored in the same manner as for the underlying instruments. Risks are also measured across the product range in order to take into account possible correlations. In the tables that follow, notional principal amounts indicate the volume of business outstanding at the balance sheet date and do not represent amounts at risk. The fair value of a derivative financial instrument represents the positive or negative cash flows which would have occurred had the rights and obligations arising from that instrument been closed out by the Group in an orderly market transaction at the balance sheet date. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | 2025 | | | | 2024^ | | | | | At 31 March | Notional principal amounts | Positive fair value | Negative fair value | | Notional principal amounts | Positive fair value | Negative fair value | | | £’000 | | | | Group | | | | | | | | | | Foreign exchange derivatives | | | | | | | | | | Forward foreign exchange contracts | 18 555 720 | 165 286 | 102 646 | | 17 274 128 | 121 509 | 76 185 | | | Currency swaps | 1 072 690 | 19 525 | 4 873 | | 536 757 | 5 497 | 4 685 | | | OTC options bought and sold | 2 412 722 | 12 381 | 15 207 | | 1 931 247 | 9 710 | 10 794 | | | | 22 041 132 | 197 192 | 122 726 | | 19 742 132 | 136 716 | 91 664 | | | Interest rate derivatives | | | | | | | | | | Caps and floors | 8 559 624 | 28 420 | 25 442 | | 11 881 599 | 99 163 | 95 676 | | | Swaps | 34 140 306 | 64 457 | 80 963 | | 40 087 486 | 80 900 | 126 493 | | | OTC options bought and sold | 54 600 | — | 447 | | 31 723 | | 505 | | | OTC derivatives | 42 754 530 | 92 877 | 106 852 | | 52 000 808 | 180 063 | 222 674 | | | Exchange traded futures | — | — | — | | | | — | | | | 42 754 530 | 92 877 | 106 852 | | 52 000 808 | 180 063 | 222 674 | | | Equity and stock index derivatives | | | | | | | | | | OTC options bought and sold | 227 044 | 6 032 | 33 337 | | 711 169 | 39 170 | 69 483 | | | Equity swaps and forwards | — | — | — | | | | — | | | OTC derivatives | 227 044 | 6 032 | 33 337 | | 711 169 | 39 170 | 69 483 | | | Exchange traded futures | 46 288 | — | — | | 109 117 | | — | | | Exchange traded options | 1 224 926 | 5 964 | — | | 4 319 032 | 53 073 | 79 | | | | 1 498 258 | 11 996 | 33 337 | | 5 139 318 | 92 243 | 69 562 | | | Commodity derivatives | | | | | | | | | | OTC options bought and sold | 319 445 | 1 113 | 1 136 | | 112 685 | 65 | 29 | | | Commodity swaps and forwards | 456 077 | 17 464 | 9 200 | | 497 975 | 17 071 | 23 424 | | | | 775 522 | 18 577 | 10 336 | | 610 660 | 17 136 | 23 453 | | | Exchange traded futures | 141 479 | 5 | — | | 171 727 | — | — | | | | 917 001 | 18 582 | 10 336 | | 782 387 | 17 136 | 23 453 | | | Credit derivatives | 361 034 | 1 737 | 1 540 | | 67 756 | 1 796 | 1 902 | | | Other derivatives | | 3 502 | | | | 4 441 | | | | Derivatives per balance sheet | | 325 886 | 274 791 | | | 432 395 | 409 255 | | ^Restated as detailed in note 57. 195 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 23. #### Derivative financial instruments #### (continued) | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | 2025 | | | | 2024 | | | | | At 31 March | Notional principal amounts | Positive fair value | Negative fair value | | Notional principal amounts | Positive fair value | Negative fair value | | | £’000 | | | | Company | | | | | | | | | | Foreign exchange derivatives | | | | | | | | | | Forward foreign exchange contracts | 16 404 118 | 152 264 | 93 703 | | 15 321 088 | 112 993 | 69 716 | | | Currency swaps | 1 053 965 | 19 525 | 4 529 | | 509 266 | 2 912 | 4 464 | | | OTC options bought and sold | 2 353 968 | 11 690 | 15 016 | | 1 893 529 | 9 363 | 10 626 | | | | 19 812 051 | 183 479 | 113 248 | | 17 723 883 | 125 268 | 84 806 | | | Interest rate derivatives | | | | | | | | | | Caps and floors | 7 970 882 | 28 291 | 24 272 | | 11 135 097 | 99 103 | 88 710 | | | Swaps | 34 116 892 | 64 616 | 84 437 | | 40 030 668 | 80 907 | 138 625 | | | Forward rate agreements | — | — | 541 | | — | — | 5 278 | | | OTC options bought and sold | 54 600 | — | 447 | | 31 723 | — | 505 | | | OTC derivatives | 42 142 374 | 92 907 | 109 697 | | 51 197 488 | 180 010 | 233 118 | | | Exchange traded futures | — | — | — | | | | — | | | | 42 142 374 | 92 907 | 109 697 | | 51 197 488 | 180 010 | 233 118 | | | Equity and stock index derivatives | | | | | | | | | | OTC options bought and sold | 227 044 | 6 032 | 33 337 | | 711 169 | 39 170 | 69 483 | | | Equity swaps and forwards | — | — | — | | — | — | — | | | OTC derivatives | 227 044 | 6 032 | 33 337 | | 711 169 | 39 170 | 69 483 | | | Exchange traded futures | 46 288 | — | — | | 109 117 | — | — | | | Exchange traded options | 1 224 926 | 5 964 | — | | 4 319 032 | 53 073 | 79 | | | | 1 498 258 | 11 996 | 33 337 | | 5 139 318 | 92 243 | 69 562 | | | Commodity derivatives | | | | | | | | | | OTC options bought and sold | 319 445 | 4 131 | 1 136 | | 112 685 | 854 | 21 252 | | | Commodity swaps and forwards | 386 927 | 14 097 | 8 951 | | 425 063 | 16 618 | 19 035 | | | | 706 372 | 18 228 | 10 087 | | 537 748 | 17 472 | 40 287 | | | Exchange traded futures | 141 479 | 5 | — | | 171 727 | — | — | | | | 847 851 | 18 233 | 10 087 | | 709 475 | 17 472 | 40 287 | | | Credit derivatives | 361 034 | 1 737 | 1 540 | | 67 756 | 1 796 | 1 902 | | | Other derivatives | | 3 502 | | | | 4 441 | | | | Derivatives per balance sheet | | 311 854 | 267 909 | | | 421 230 | 429 675 | | 196 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 24. #### Securities arising from trading activities | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Bonds | — | | 12 050 | | — | | 12 050 | | | Government securities | — | | 171 | | — | | 171 | | | Listed equities | 149 912 | | 145 111 | | 149 912 | | 145 111 | | | | 149 912 | | 157 332 | | 149 912 | | 157 332 | | 25. #### Investment portfolio | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Listed equities | 866 | | 789 | | 1 | | 37 | | | Unlisted equities\* | 210 887 | | 243 351 | | 32 026 | | 43 640 | | | | 211 753 | | 244 140 | | 32 027 | | 43 677 | | \*Unlisted equities include loan instruments that are convertible into equity. 26. #### Loans and advances to customers and other loans and advances | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Gross loans and advances to customers at amortised cost | 14 378 669 | | 14 631 845 | | 10 440 785 | | 10 785 526 | | | Gross loans and advances to customers at FVOCI^ | 2 005 308 | | 1 471 371 | | 1 936 974 | | 1 471 371 | | | Suspended interest | 11 607 | | 5 066 | | 10 197 | | 4 297 | | | Gross loans and advances to customers subject to expected credit losses | 16 395 584 | | 16 108 282 | | 12 387 956 | | 12 261 194 | | | Expected credit losses on loans and advances to customers at amortised cost | (142 183) | | (174 100) | | (97 160) | | (125 709) | | | Suspended interest | (11 607) | | (5 066) | | (10 197) | | (4 297) | | | Net loans and advances to customers at amortised cost and FVOCI^ | 16 241 794 | | 15 929 116 | | 12 280 599 | | 12 131 188 | | | Loans and advances to customers at fair value through profit and loss | 571 929 | | 641 197 | | 512 882 | | 561 435 | | | Net loans and advances to customers | 16 813 723 | | 16 570 313 | | 12 793 481 | | 12 692 623 | | | | | | | | | | | | | Gross other loans and advances | 162 909 | | 145 575 | | 3 337 522 | | 3 294 144 | | | Expected credit losses on other loans and advances | (27) | | (30) | | (6 476) | | (6 460) | | | Net other loans and advances at amortised cost | 162 882 | | 145 545 | | 3 331 046 | | 3 287 684 | | | Other loans and advances at fair value through profit and loss | — | | — | | 9 460 | | 24 124 | | | Net other loans and advances | 162 882 | | 145 545 | | 3 340 506 | | 3 311 808 | | ^Expected credit losses above do not include £22.6 million (31 March 2024 : £13.3 million) ECL held against financial assets held at FVOCI. In accordance with IFRS 9, interest should only be recognised on the net position (i.e. gross loans and advances less ECL) on positions in Stage 3. Suspended interest relates to interest not recognised relating to the ECL on these loans and advances. Interest is suspended from the time an asset transfers into Stage 3. For further analysis on loans and advances for the Group, refer to pages [260](#i447e4d363cd344738300acdd42f0e3a0_496) to [266](#i447e4d363cd344738300acdd42f0e3a0_499) in the notes to risk and capital management, for the Company pages [292](#i447e4d363cd344738300acdd42f0e3a0_529) to [293](#id4e335202ea2487094501d99658e2ab3_0-0-1-1-2494133) . 197 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 26 . #### Loans and advances to customers and other loans and advances #### (continued) | | | | | | --- | --- | --- | --- | | | | | | | At 31 March | Group | Company | | | £’000 | | | Expected credit losses on loans and advances to customers at amortised cost^ | | | | | Balance as at 1 April 2023 | 140 725 | 101 866 | | | Charge to the income statement | 82 358 | 63 489 | | | Reversals and recoveries recognised in the income statement | (83) | (83) | | | Write-offs | (48 018) | (38 702) | | | Exchange adjustments | (882) | (861) | | | Balance as at 31 March 2024 | 174 100 | 125 709 | | | Charge to the income statement | 87 414 | 73 381 | | | Reversals and recoveries recognised in the income statement | (7) | (7) | | | Write-offs | (118 207) | (100 825) | | | Exchange adjustments | (1 117) | (1 098) | | | Balance as at 31 March 2025 | 142 183 | 97 160 | | | Expected credit loss on other loans and advances | | | | | Balance as at 1 April 2023 | 93 | 6 391 | | | Charge to the income statement | (63) | 120 | | | Write-offs | — | (51) | | | Balance as at 31 March 2024 | 30 | 6 460 | | | Charge to the income statement | 6 | 16 | | | Exchange adjustments | (9) | — | | | Balance as at 31 March 2025 | 27 | 6 476 | | ^Expected credit losses above do not include £22.6 million (31 March 2024: £13.3 million) ECL held against financial assets held at FVOCI. Of the amounts written off in the current period within the Group and Company, £6.8 million are subject to enforcement activity at the year end (31 March 2024: £nil). 27. #### Other securitised assets and liabilities arising on securitisation | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | Group | | | Company | | | | At 31 March | | 2024 | | | 2024 | | | £’000 | | | | | | Other securitised assets are made up of the following categories of assets: | | | | | | | | Loans and advances to customers | | 66 234 | | | — | | | Other debt securities | | 468 | | | 468 | | | Total other securitised assets | | 66 702 | | | 468 | | | The associated liabilities are recorded on-balance sheet in the following line items: | | | | | | | | Liabilities arising on securitisation of other assets | | 71 751 | | | — | | During the year, the Group sold a residual tranche holding in Landmark Mortgage Securities No. 2 plc structured entity which subsequently resulted in the deconsolidation of the SPV and its related assets and liabilities. 198 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 28. #### Interests in associated undertakings and joint venture holdings | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Group | | | | | | Interests in associated undertakings and joint venture holdings consist of: | | | | | | Net asset value | 225 068 | | 136 760 | | | Goodwill and intangibles within the carrying value | 607 073 | | 654 512 | | | Investment in associated undertakings and joint venture holdings | 832 141 | | 791 272 | | | Associated undertakings and joint venture holdings comprise listed and unlisted investments | | | | | | Analysis of the movement in our share of net assets: | | | | | | At the beginning of the year | 136 760 | | 5 011 | | | Exchange adjustments | (864) | | (99) | | | Rathbones measurement period finalisation^^ | 53 369 | | — | | | Acquisitions\* | — | | 119 230 | | | Derecognition from stepped acquisition/disposals | — | | (2 123) | | | Transfer from investment portfolio^ | 27 835 | | — | | | Share of post-taxation profits of associates and joint venture holdings | 44 393 | | 14 712 | | | Share of other comprehensive income and equity of associates and joint venture holdings | (12 252) | | 257 | | | Dividends received | (24 173) | | (228) | | | At the end of the year | 225 068 | | 136 760 | | | Analysis of the movement in goodwill and intangibles: | | | | | | At the beginning of the year | 654 512 | | 5 840 | | | Exchange adjustments | (188) | | (126) | | | Rathbones measurement period finalisation^^ | (47 601) | | — | | | Acquisitions\* | — | | 660 191 | | | Derecognition from stepped acquisition | — | | (5 714) | | | Transfer from investment portfolio^ | 6 662 | | — | | | Amortisation of acquired intangibles of associates | (6 312) | | (5 679) | | | At the end of the year | 607 073 | | 654 512 | | \*Refer to note 34 for more details. ^ Historically, Investec Capital Services (India) Pvt Ltd (ICSI) has been a joint venture, accounted for at fair value and presented within the investment portfolio. During the year, certain of Investec’s co-joint venturer’s rights lapsed, and as a result, it is no longer appropriate to apply fair value accounting and will be equity accounted going forward from the date of this change. ^^Following the acquisition of Rathbones, the Group has finalised the purchase price allocation. The acquisition date fair values of identifiable assets, liabilities, and contingent liabilities have been assessed and allocated appropriately to intangible assets and the residual value has been recognised as goodwill. This process resulted in an increase in net assets of £53.4 million and a decrease in goodwill and intangibles of £47.6 million. As the impact on the financial statements was immaterial, these were adjusted for prospectively in the current year. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Company | | | | | | Analysis of the movement in investment: | | | | | | At the beginning of the year | 781 674 | | 2 301 | | | Exchange adjustments | (43) | | (48) | | | Acquisitions | — | | 779 421 | | | Measurement period finalisation | 5 769 | | — | | | At the end of the year | 787 400 | | 781 674 | | | Provision for impairment in value: | | | | | | At the beginning of the year | — | | — | | | At the end of the year | — | | — | | | Net book value at the end of the year | 787 400 | | 781 674 | | 199 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 28 . #### Interests in associated undertakings and joint venture holdings #### (continued) | | | | | --- | --- | --- | | | | | | | Rathbones Group plc | | | | 2025 | 2024 | | Details of material associated undertakings | | | | Summarised financial information (£’000): | | | | Operating income\* | 895 875 | 436 272 | | Profit after taxation\* | 65 398 | 35 000 | | Other comprehensive income\* | (7 967) | | | Total comprehensive income\* | 57 431 | | | | | | | Total assets | 4 290 034 | 4 853 534 | | Total liabilities | 2 930 672 | 3 472 425 | | Net asset value | 1 359 362 | 1 381 109 | | Effective interest in issued share capital | 41.25% | 41.25% | | Net asset value at 41.25% | 560 737 | 569 707 | | Less: Goodwill and intangibles net of deferred tax per Rathbones | (368 604) | | | Add: Goodwill and Investec’s share of intangibles assets net of deferred tax | 600 599 | | | Carrying value of interest – equity method ^ | 792 732 | 788 437 | | Fair value of 41.25% interest in Rathbones Group | 692 126 | 779 421 | \*Income statement and other comprehensive income items are only shown for the period for which they are equity accounted. ^ The difference between the carrying value of Rathbones and the net asset value relates to intangible assets, and goodwill that was recognised in the carrying value as a direct result of the fair value exceeding the fair value of the identifiable assets at 21 September 2023. Rathbones has a statutory year end of 31 December and the Group now recognises its share of earnings on a three months in arrears basis. The financial information presented above aligns with this reporting date. In the prior year this was not the case therefore the information on other comprehensive income was not available. 200 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 29. #### Deferred taxation | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Deferred taxation assets | 120 918 | | 119 730 | | 50 454 | | 58 572 | | | Deferred taxation liabilities | — | | — | | — | | — | | | Net deferred taxation assets | 120 918 | | 119 730 | | 50 454 | | 58 572 | | | The net deferred taxation assets arise from: | | | | | | | | | | Deferred capital allowances | 72 665 | | 62 042 | | 5 016 | | 5 443 | | | Income and expenditure accruals | 138 | | 1 096 | | — | | 213 | | | Asset in respect of unexpired options | 33 072 | | 42 436 | | 33 072 | | 42 436 | | | Unrealised fair value adjustments on financial instruments | 13 284 | | 11 748 | | 12 366 | | 10 480 | | | Losses carried forward | 1 397 | | 2 046 | | — | | — | | | Asset in respect of pension deficit | 362 | | 362 | | — | | — | | | Net deferred taxation assets | 120 918 | | 119 730 | | 50 454 | | 58 572 | | | Reconciliation of net deferred taxation assets | | | | | | | | | | At the beginning of the year | 119 730 | | 111 513 | | 58 572 | | 59 833 | | | Release/(charge) to income statement | 4 807 | | 9 924 | | (4 714) | | 6 231 | | | Movement directly in other comprehensive income and equity | (3 552) | | (7 686) | | (3 404) | | (7 492) | | | Arising on acquisitions/disposals | — | | 6 035 | | — | | — | | | Exchange adjustments | (67) | | (56) | | — | | — | | | At the end of the year | 120 918 | | 119 730 | | 50 454 | | 58 572 | | Deferred tax assets are recognised to the extent it is likely that profits will arise in future periods. The assessment of the likelihood of future profits is based on past performance and current projections. Deferred taxation assets are not recognised in respect of capital losses and excess management expenses as crystallisation of capital gains and the eligibility of potential losses is uncertain. There are trading losses carried forward of £70.7 million (2024: £89.9 million). Company: £25.3 million ( 2024 Company: £25.3 million) and capital losses carried forward of £82.9 million (2024: £83.3 million) on which deferred tax assets have not been recognised due to uncertainty regarding future profits against which these losses can be utilised. Of the £70.7 million trading losses, £1 million (2024: £8.5 million) will expire in the next four years. 30. #### Other assets | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024^ | | 2025 | | 2024 | | | £’000 | | | | | | Gross other assets | 677 317 | | 750 347 | | 388 833 | | 447 974 | | | Expected credit loss | — | | — | | — | | — | | | Net other assets | 677 317 | | 750 347 | | 388 833 | | 447 974 | | | Financial assets | | | | | | | | | | Settlement debtors | 290 629 | | 336 788 | | 283 455 | | 331 388 | | | Trading initial margin | 1 228 | | 4 732 | | 1 228 | | 4 732 | | | Prepayments and accruals | 33 681 | | 38 509 | | 31 928 | | 34 554 | | | Other | 56 009 | | 75 417 | | 43 655 | | 52 207 | | | | 381 547 | | 455 446 | | 360 266 | | 422 881 | | | Scoped out of IFRS 9 | | | | | | | | | | Trading properties | 84 704 | | 62 500 | | — | | — | | | Prepayments and accruals | 24 786 | | 19 296 | | 13 935 | | 13 261 | | | Finance lease receivables | 3 584 | | 160 628 | | — | | — | | | Indirect taxation assets receivable | 773 | | 80 | | 653 | | — | | | Aircraft and aircraft related structures\* | 135 783 | | — | | — | | — | | | Other | 46 140 | | 52 397 | | 13 979 | | 11 832 | | | | 295 770 | | 294 901 | | 28 567 | | 25 093 | | | | 677 317 | | 750 347 | | 388 833 | | 447 974 | | ^Restated as detailed in note 57. \* During the year, a modification in the terms of a finance lease, resulted in a subsequent change of classification to an operating lease and an asset of £136 million being recognised in other assets. The future minimum lease payments of £21 million (2024: £nil) are due within one year. 201 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 31. #### Property and equipment | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | At 31 March | Freehold properties | Right-of-use assets^ | Leasehold improvements | Furniture and vehicles | Equipment | Operating leases\* | Total | | | £’000 | | | Group | | | | | | | | | | 2025 | | | | | | | | | | Cost | | | | | | | | | | At the beginning of the year | 36 | 96 930 | 46 113 | 7 791 | 8 007 | 1 296 | 160 173 | | | Exchange adjustments | — | (504) | (93) | (14) | (73) | — | (684) | | | Additions | — | 913 | 981 | 706 | 1 010 | — | 3 610 | | | Disposals | (36) | (411) | (1 190) | (293) | (166) | (224) | (2 320) | | | At the end of the year | — | 96 928 | 45 811 | 8 190 | 8 778 | 1 072 | 160 779 | | | Accumulated depreciation | | | | | | | | | | At the beginning of the year | (36) | (47 418) | (26 681) | (4 977) | (6 975) | (1 139) | (87 226) | | | Exchange adjustments | — | 195 | 40 | 4 | 25 | — | 264 | | | Disposals | 36 | 180 | 1 125 | 281 | 63 | 200 | 1 885 | | | Depreciation and impairment charge for the year | — | (10 547) | (5 079) | (661) | (458) | (17) | (16 762) | | | At the end of the year | — | (57 590) | (30 595) | (5 353) | (7 345) | (956) | (101 839) | | | Net carrying value | — | 39 338 | 15 216 | 2 837 | 1 433 | 116 | 58 940 | | | 2024 | | | | | | | | | | Cost | | | | | | | | | | At the beginning of the year | 36 | 141 830 | 57 382 | 7 129 | 26 330 | 1 431 | 234 138 | | | Exchange adjustments | — | (268) | (41) | 45 | (21) | — | (285) | | | Acquisition of subsidiaries | — | — | — | 506 | — | — | 506 | | | Additions | — | 8 063 | 892 | 221 | 1 972 | 53 | 11 201 | | | Disposals | — | (292) | (2) | (110) | (84) | (188) | (676) | | | Deconsolidation of subsidiaries | — | (52 403) | (12 118) | — | (14 262) | — | (78 783) | | | Write-off | — | — | — | — | (5 928) | — | (5 928) | | | At the end of the year | 36 | 96 930 | 46 113 | 7 791 | 8 007 | 1 296 | 160 173 | | | Accumulated depreciation | | | | | | | | | | At the beginning of the year | (36) | (55 858) | (31 181) | (4 170) | (20 594) | (1 285) | (113 124) | | | Exchange adjustments | — | 134 | 25 | 42 | 19 | — | 220 | | | Acquisition of subsidiaries | — | — | — | (256) | — | — | (256) | | | Disposals | — | 242 | 2 | 110 | 81 | 174 | 609 | | | Deconsolidation of subsidiaries | — | 20 568 | 9 684 | — | 11 662 | — | 41 914 | | | Depreciation and impairment charge for the year\*\* | — | (12 504) | (5 211) | (703) | (1 872) | (28) | (20 318) | | | Write-off | — | — | — | — | 3 729 | — | 3 729 | | | At the end of the year | (36) | (47 418) | (26 681) | (4 977) | (6 975) | (1 139) | (87 226) | | | Net carrying value | — | 49 512 | 19 432 | 2 814 | 1 032 | 157 | 72 947 | | \*These are assets held by the Group, in circumstances where the Group is lessor. ^Right-of-use assets primarily comprise property leases under IFRS 16. \*\*In the prior year, included within the depreciation and impairment charge for the year above is £4 million of depreciation expense relating to discontinued operations, which is presented as part of the profit after taxation from discontinued operations in the income statement. 202 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 31 . #### Property and equipment #### (continued) | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | At 31 March | Right-of-use assets^ | Leasehold improvements | Furniture and vehicles | Equipment | | Total | | | £’000 | | | | Company | | | | | | | | | 2025 | | | | | | | | | Cost | | | | | | | | | At the beginning of the year | 59 617 | 41 191 | 5 580 | 11 848 | | 118 236 | | | Additions | 462 | — | — | 83 | | 545 | | | At the end of the year | 60 079 | 41 191 | 5 580 | 11 931 | | 118 781 | | | Accumulated depreciation | | | | | | | | | At the beginning of the year | (33 258) | (24 690) | (3 151) | (11 421) | | (72 520) | | | Depreciation and impairment charge for the year | (6 020) | (4 290) | (542) | (84) | | (10 936) | | | At the end of the year | (39 278) | (28 980) | (3 693) | (11 505) | | (83 456) | | | Net carrying value | 20 801 | 12 211 | 1 887 | 426 | | 35 325 | | | 2024 | | | | | | | | | Cost | | | | | | | | | At the beginning of the year | 59 617 | 41 191 | 5 501 | 16 672 | | 122 981 | | | Additions | — | — | 79 | 1 104 | | 1 183 | | | Write-off | — | — | — | (5 928) | | (5 928) | | | At the end of the year | 59 617 | 41 191 | 5 580 | 11 848 | | 118 236 | | | Accumulated depreciation | | | | | | | | | At the beginning of the year | (27 279) | (20 400) | (2 609) | (14 116) | | (64 404) | | | Depreciation and impairment charge for the year | (5 979) | (4 290) | (542) | (1 034) | | (11 845) | | | Write-off | — | — | — | 3 729 | | 3 729 | | | At the end of the year | (33 258) | (24 690) | (3 151) | (11 421) | | (72 520) | | | Net carrying value | 26 359 | 16 501 | 2 429 | 427 | | 45 716 | | ^Right-of-use assets primarily comprise property leases under IFRS 16. 203 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 32. #### Goodwill | | | | | | | --- | --- | --- | --- | --- | | | | | | | | At 31 March | 2025 | | 2024 | | | £’000 | | | | Cost | | | | | | At the beginning of the year | 90 960 | | 282 381 | | | Acquisition of subsidiaries | — | | 56 268 | | | Adjustments to goodwill on acquisition within the measurement period | — | | (200) | | | Deconsolidation of subsidiaries | — | | (247 175) | | | Exchange adjustments | (1 148) | | (314) | | | At the end of the year | 89 812 | | 90 960 | | | Accumulated impairments | | | | | | At the beginning of the year | (32 878) | | (32 878) | | | At the end of the year | (32 878) | | (32 878) | | | Net carrying value | 56 934 | | 58 082 | | | Analysis of goodwill by line of business: | | | | | | Specialist Banking | 56 934 | | 58 082 | | | Total Group | 56 934 | | 58 082 | | Goodwill is tested annually for impairment, or more frequently if evidence exists that goodwill might be impaired, by comparing the carrying value to its recoverable amount. The recoverable amount of goodwill is determined based on expected cash flows within the cash-generating units of the Group to which the goodwill is allocated. Key assumptions within the calculation include discount rates, growth rates in revenue, and related expenditure. Discount rates are based on pre-tax rates that reflect current market conditions, adjusted for the specific risks associated with the cash-generating unit. Growth rates are based on industry growth forecasts. Cash flow forecasts are based on the most recent financial budgets for the next financial year and are extrapolated for a period of three to five years, adjusted for expected future events. The most significant cash-generating unit giving rise to goodwill is Investec Continental Europe Advisory (previously Capitalmind), with goodwill of £54.8 million. The goodwill has been tested for impairment on the basis of the cash flow projections for the next three years, discounted at 12.77% (2024: 11.62%) which incorporate an expected revenue growth rate of nil in perpetuity (2024: 2%). The valuation is based on value in use of the business. Movement in goodwill There have been no significant movements in goodwill for the current year. During the prior year, goodwill decreased by £247.2 million as a result of the deconsolidation of Investec Wealth & Investment following the all-share combination with Rathbones Group. For more details refer to note 34. During the prior year, the increase of £56.3 million is due to the acquisition of Investec Continental Europe Advisory in a stepped acquisition. 204 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 33. #### Software and other acquired intangible assets | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Software | | | Other acquired intangible assets | | | | | | At 31 March | Acquired software | Internally generated software | Total | Client relationships\* | Total | | Total | | | £’000 | | | | Group | | | | | | | | | | 2025 | | | | | | | | | | Cost | | | | | | | | | | At the beginning of the year | 21 499 | — | 21 499 | 4 356 | 4 356 | | 25 855 | | | Exchange adjustments | (18) | — | (18) | (19) | (19) | | (37) | | | Additions | 1 190 | — | 1 190 | — | — | | 1 190 | | | At the end of the year | 22 671 | — | 22 671 | 4 337 | 4 337 | | 27 008 | | | Accumulated amortisation and impairments | | | | | | | | | | At the beginning of the year | (16 928) | — | (16 928) | (4 356) | (4 356) | | (21 284) | | | Exchange adjustments | 18 | — | 18 | 19 | 19 | | 37 | | | Amortisation | (1 019) | — | (1 019) | — | — | | (1 019) | | | At the end of the year | (17 929) | — | (17 929) | (4 337) | (4 337) | | (22 266) | | | Net carrying value | 4 742 | — | 4 742 | — | — | | 4 742 | | | 2024 | | | | | | | | | | Cost | | | | | | | | | | At the beginning of the year | 29 803 | 3 298 | 33 101 | 193 359 | 193 359 | | 226 460 | | | Exchange adjustments | (42) | — | (42) | (5) | (5) | | (47) | | | Acquisition of subsidiaries | — | — | — | 945 | 945 | | 945 | | | Additions | 710 | — | 710 | — | — | | 710 | | | Disposals | (381) | — | (381) | — | — | | (381) | | | Deconsolidation of subsidiaries | (8 591) | (3 298) | (11 889) | (189 943) | (189 943) | | (201 832) | | | At the end of the year | 21 499 | — | 21 499 | 4 356 | 4 356 | | 25 855 | | | Accumulated amortisation and impairments | | | | | | | | | | At the beginning of the year | (22 432) | (1 254) | (23 686) | (149 472) | (149 472) | | (173 158) | | | Exchange adjustments | 39 | — | 39 | — | — | | 39 | | | Disposals | 240 | — | 240 | — | — | | 240 | | | Deconsolidation of subsidiaries | 6 542 | 1 643 | 8 185 | 152 480 | 152 480 | | 160 665 | | | Amortisation\*\* | (1 317) | (389) | (1 706) | (7 364) | (7 364) | | (9 070) | | | At the end of the year | (16 928) | — | (16 928) | (4 356) | (4 356) | | (21 284) | | | Net carrying value | 4 571 | — | 4 571 | — | — | | 4 571 | | \*Client relationships are acquired intangibles. \*\*In the prior year, included within the amortisation charge above is £7 million of amortisation expense relating to discontinued operations, which is presented as part of the profit after taxation from discontinued operations in the income statement. 205 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 33 . #### Software and other acquired intangible assets #### (continued) | | | | | --- | --- | --- | | | | | | At 31 March | Acquired software | | | £’000 | | | Company | | | | 2025 | | | | Cost | | | | At the beginning of the year | 2 636 | | | At the end of the year | 2 636 | | | Accumulated amortisation and impairments | | | | At the beginning of the year | (2 636) | | | At the end of the year | (2 636) | | | Net carrying value | — | | | 2024 | | | | Cost | | | | At the beginning of the year | 3 017 | | | Disposals | (381) | | | At the end of the year | 2 636 | | | Accumulated amortisation and impairments | | | | At the beginning of the year | (2 779) | | | Disposals | 240 | | | Amortisation | (97) | | | At the end of the year | (2 636) | | | Net carrying value | — | | 206 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 34. #### Acquisitions and disposals There were no significant acquisitions or disposals of subsidiaries in the current year. During the prior year, the Group completed a stepped acquisition increasing its shareholding in the Investec Continental Europe Advisory associate from 30% to 60% for a total consideration attributable to the increase in shareholding of £29.4 million and therefore as at 31 March 2024 had consolidated these entities as subsidiaries. The non-controlling interest was measured as the proportionate share of the identifiable net assets. Goodwill of £56.3 million, including a deferred taxation liability of £0.2 million and an intangible asset of £0.9 million were recognised as a consequence of this increased shareholding. The goodwill recognised is the difference between the purchase price for the additional 30% acquired, the fair value of the previously held 30%, the non-controlling interest measured at its proportionate share of 40% of net asset, and the fair value of the identifiable assets and liabilities on transaction date. Goodwill represents the value of acquired intangible assets as of the acquisition date that did not meet the criteria for separate recognition, such as the assembled workforce of partners and potential contracts subject to negotiation. Goodwill on acquisition is calculated as follows: | | | | --- | --- | | | | | £’000 | | | Consideration\* | 29 352 | | Fair value of previously held 30% holding^ | 27 505 | | | 56 857 | | Fair value of identifiable net assets | 452 | | Intangible assets | 945 | | Less, deferred taxation liability on intangible assets | (236) | | Less, non-controlling interests as proportionate share of acquired net assets | (572) | | | 589 | | Goodwill | 56 268 | \*Consideration attributable to the purchase of 30% was made up of £20.9 million cash and £8.5 million deferred consideration. Deferred consideration is not contingent on any performance measures. ^Included within Investment income in the Income statement is a gain of £4.2 million from the remeasurement of the previously held 30% holding. | | | | --- | --- | | | | | £’000 | | | Fair value of identifiable net assets | | | Loans and advances to banks | 2 332 | | Property and equipment | 250 | | Other assets | 3 533 | | Other liabilities | (5 663) | | | 452 | Post-acquisition operating income of £16.6 million and profit after taxation of £2.6 million have been included in the consolidated income statement for the prior reporting period. In the prior year, as a result of the all-share combination of Investec Wealth & Investment Limited and Rathbones Group Plc, as detailed below, Investec Wealth and Investment Limited ceased to be a subsidiary. 207 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 34. #### Acquisitions and disposals #### (continued) Discontinued operations Investec Wealth & Investment Limited In the prior year, on 21 September 2023, the Investec Group successfully completed the all-share combination of Investec Wealth & Investment Limited with Rathbones Group Plc (Rathbones). On completion Rathbones issued new Rathbones shares in exchange for 100% of Investec Wealth & Investment Limited’s share capital. The Group now owns 41.25% of the economic interest in the enlarged Rathbones Group, with the Group’s voting rights limited to 29.9%. The Group's holding in Rathbones Group Plc is equity accounted for as an interest in associated undertakings and joint venture holdings in accordance with IAS 28. Income statement of discontinued operations | | | | --- | --- | | | | | For the year to 31 March | 2024 | | £’000 | | Interest income | 17 755 | | Interest expense | (431) | | Net interest income | 17 324 | | Fee and commission income | 161 610 | | Fee and commission expense | — | | Investment income | — | | Trading income arising from | | | – customer flow | — | | – balance sheet management and other trading activities | — | | Other operating income | — | | Operating income | 178 934 | | Expected credit loss impairment charges | — | | Operating income after expected credit loss impairment charges | 178 934 | | Operating costs | (131 106) | | Adjusted operating profit | 47 828 | | Amortisation of acquired intangibles | (6 424) | | Gain on all-share combination net of implementation costs | 364 554 | | Profit before taxation | 405 958 | | Taxation on operating profit before acquired intangibles and strategic actions | (11 973) | | Taxation on acquired intangibles and strategic actions | 1 615 | | Profit after taxation | 395 600 | | Profit attributable to non-controlling interests of discontinued operations | — | | Earnings attributable to shareholder | 395 600 | Gain on loss of control of Investec Wealth & Investment Limited The gain was calculated as follows: | | | | --- | --- | | | | | £’000 | | | Fair value of 41.25% interest in Rathbones Group Plc | 779 421 | | Net asset value of Investec Wealth & Investment previously consolidated (including goodwill) | (413 915) | | Gain on the combination of Rathbones Group (before tax) | 365 506 | | Implementation costs | (952) | | Gain on combination of Rathbones Group (before tax) | 364 554 | | Taxation on gain | — | | Gain on combination of Rathbones Group net of taxation and implementation costs | 364 554 | Major classes of assets and liabilities | | | | --- | --- | | | | | £’000 | | | Loans and advances to banks | 172 595 | | Goodwill | 247 175 | | Other assets | 363 718 | | Other liabilities | (369 573) | | | 413 915 | 208 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 35. #### Other trading liabilities | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Group and Company | | | | | At 31 March | 2025 | | 2024 | | | £’000 | | | | Short positions | | | | | | – Equities | 16 242 | | 18 449 | | | | 16 242 | | 18 449 | | 36. #### Customer accounts (deposits) | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Demand | 6 797 503 | | 5 644 504 | | 6 629 365 | | 5 826 783 | | | Transactional | 437 022 | | 484 625 | | 437 022 | | 484 625 | | | Fixed | 6 745 977 | | 9 447 201 | | 6 149 419 | | 8 931 742 | | | Notice | 7 574 942 | | 5 274 886 | | 6 736 367 | | 4 477 455 | | | | 21 555 444 | | 20 851 216 | | 19 952 173 | | 19 720 605 | | 37. #### Debt securities in issue | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Repayable in: | | | | | | | | | | Less than three months | 10 861 | | 16 660 | | 10 861 | | 16 660 | | | Three months to one year | 98 562 | | 96 842 | | 98 562 | | 96 842 | | | One to five years | 448 820 | | 832 710 | | 448 820 | | 832 710 | | | Greater than five years | 416 128 | | 10 675 | | 414 933 | | 9 482 | | | | 974 371 | | 956 887 | | 973 176 | | 955 694 | | | Debt securities in issue shown above comprise: | | | | | | | | | | Senior unsecured notes | 841 097 | | 660 117 | | 841 096 | | 660 118 | | | Structured notes | 132 080 | | 295 576 | | 132 080 | | 295 576 | | | Redeemable preference shares | 1 194 | | 1 194 | | — | | — | | | | 974 371 | | 956 887 | | 973 176 | | 955 694 | | 38. #### Other liabilities | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024^ | | 2025 | | 2024 | | | £’000 | | | | | | Financial liabilities | | | | | | | | | | Settlement liabilities | 279 613 | | 310 134 | | 274 336 | | 304 302 | | | Other creditors and accruals | 136 917 | | 158 258 | | 82 781 | | 85 030 | | | Other non-interest bearing liabilities | 82 796 | | 77 461 | | 88 885 | | 68 260 | | | Expected credit losses on undrawn commitments and guarantees | 9 977 | | 11 258 | | 9 890 | | 11 198 | | | | 509 303 | | 557 111 | | 455 892 | | 468 790 | | | Scoped out of IFRS 9 | | | | | | | | | | Other creditors and accruals\* | 179 499 | | 167 001 | | 132 159 | | 145 677 | | | Lease liabilities | 196 979 | | 243 951 | | 30 256 | | 38 563 | | | Other non-interest bearing liabilities | 7 267 | | 17 465 | | 3 216 | | 1 247 | | | Indirect taxation liabilities payable | 498 | | 1 909 | | 444 | | 748 | | | | 384 243 | | 430 326 | | 166 075 | | 186 235 | | | | 893 546 | | 987 437 | | 621 967 | | 655 025 | | \*Included in Other creditors and accruals is a provision relating to motor vehicle financing. Refer to note 47 for more details. ^Restated as detailed in note 57. 209 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 38 . #### Other liabilities #### (continued) The maturity analysis of the lease liabilities is shown below: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | 2025 | | | | 2024 | | | | | At 31 March | Undiscounted lease payments | | Present value | | Undiscounted lease payments | | Present value | | | £’000 | | | | | | Group | | | | | | | | | | Lease liabilities included in other liabilities | | | | | | | | | | Lease liabilities payable in: | | | | | | | | | | Less than one year | 161 097 | | 156 024 | | 55 810 | | 53 152 | | | One to two years | 14 921 | | 14 210 | | 164 646 | | 151 874 | | | Two to three years | 14 837 | | 13 780 | | 14 981 | | 14 104 | | | Three to four years | 8 337 | | 7 426 | | 14 369 | | 13 847 | | | Four to five years | 2 478 | | 2 358 | | 5 319 | | 5 114 | | | Later than five years | 3 688 | | 3 181 | | 6 099 | | 5 860 | | | | 205 358 | | 196 979 | | 261 224 | | 243 951 | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | 2025 | | | | 2024 | | | | | At 31 March | Undiscounted lease payments | | Present value | | Undiscounted lease payments | | Present value | | | £’000 | | | | | | Company | | | | | | | | | | Lease liabilities included in other liabilities | | | | | | | | | | Lease liabilities payable in: | | | | | | | | | | Less than one year | 8 847 | | 8 778 | | 11 767 | | 10 973 | | | One to two years | 8 813 | | 8 594 | | 8 806 | | 8 374 | | | Two to three years | 8 813 | | 8 447 | | 8 653 | | 8 361 | | | Three to four years | 4 720 | | 4 437 | | 8 653 | | 8 502 | | | Four to five years | — | | — | | 2 375 | | 2 353 | | | Later than five years | — | | — | | — | | — | | | | 31 193 | | 30 256 | | 40 254 | | 38 563 | | Reconciliation from opening balance to closing balance | | | | | | | --- | --- | --- | --- | --- | | | | | | | | At 31 March | Group | | Company | | | £’000 | | Balance as at 1 April 2023 | 322 767 | | 46 060 | | | Interest on lease liabilities | 11 576 | | 723 | | | New leases | 7 973 | | — | | | Deconsolidation of subsidiaries | (39 752) | | — | | | Repayment of lease liabilities | (54 020) | | (8 220) | | | Capital repayment | (42 444) | | (7 497) | | | Interest repayment | (11 576) | | (723) | | | Exchange adjustments | (4 593) | | — | | | Balance as at 31 March 2024 | 243 951 | | 38 563 | | | Interest on lease liabilities | 9 708 | | 581 | | | New leases | 805 | | 462 | | | Repayment of lease liabilities | (53 484) | | (9 350) | | | Capital repayment | (43 776) | | (8 769) | | | Interest repayment | (9 708) | | (581) | | | Remeasurement of lease liabilities | (294) | | — | | | Exchange adjustments | (3 707) | | — | | | Balance as at 31 March 2025 | 196 979 | | 30 256 | | Renewal options are taken into account when determining the term of the lease. 210 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 39. #### Subordinated liabilities | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Issued by Investec Bank plc | | | | | | | | | | Subordinated fixed rate reset callable medium-term notes | 682 218 | | 668 810 | | 682 218 | | 668 810 | | | | 682 218 | | 668 810 | | 682 218 | | 668 810 | | | Remaining maturities: | | | | | | | | | | In one year or less, or on demand | — | | — | | — | | — | | | In more than one year, but not more than two years | — | | — | | — | | — | | | In more than two years, but not more than five years | — | | — | | — | | — | | | In more than five years | 682 218 | | 668 810 | | 682 218 | | 668 810 | | | | 682 218 | | 668 810 | | 682 218 | | 668 810 | | | Reconciliation from opening balance to closing balance | | | | | | | | | | At the beginning of the year | 668 810 | | 731 483 | | 668 810 | | 731 483 | | | Redemption | — | | (70 000) | | — | | (70 000) | | | Accrual of interest | 41 112 | | 42 067 | | 41 112 | | 42 067 | | | Repayment of interest | (41 125) | | (44 100) | | (41 125) | | (44 100) | | | Hedge accounting/amortisation of discount | 13 421 | | 9 360 | | 13 421 | | 9 360 | | | At the end of the year | 682 218 | | 668 810 | | 682 218 | | 668 810 | | The only potential event of default in relation to the subordinated debt is the non-payment of principal or interest. The only remedy available to the holders of the subordinated debt in the event of default would be to petition for the winding up of the issuing entity. In a winding up no amount will be paid in respect of the subordinated debt until all other creditors have been paid in full. Medium-term notes Subordinated fixed rate reset callable medium-term notes (denominated in Pound Sterling) On 24 July 2018, Investec Bank plc issued £420 000 000 of 4.25% subordinated notes due 2028 at a discount (2028 notes). Interest is paid annually. The notes are listed on the London Stock Exchange. The notes are redeemable at par on 24 July 2028, with a one-time redemption option on the early redemption date 24 July 2023 subject to conditions. On 6 December 2022, Investec Bank plc completed a tender offer to purchase £350 000 000 aggregate nominal amount of the notes at a cash purchase price of 99.446 pence plus an accrued interest payment. The total value of the debt redeemed was £353 605 000 (excluding interest £347 926 000). On 24 July 2023, Investec Bank plc exercised the one-time option to early redeem the remaining £70 000 000 aggregate nominal amount of the notes at par plus an accrued interest payment. Including the interest, the total value of the debt redeemed was £72 975 000. Subordinated prepayable fixed rate resettable medium-term loan (denominated in Pound Sterling) On 4 October 2021, Investec Bank plc entered into a £350 000 000 subordinated loan at a rate of 2.625% and repayable in 2032 (2032 loan) with Investec plc. Interest, after the initial short-period distribution paid on 4 January 2022, is paid annually commencing on 4 January 2023 and ending on the maturity date. The loan may be prepaid on any date in the period from 4 October 2026 to (and including) 4 January 2027 subject to conditions. If the option to prepay is not exercised, the loan will be repaid on the maturity date of 4 January 2032. Subordinated prepayable fixed rate resettable medium-term loan (denominated in Pounds Sterling) On 6 December 2022, Investec Bank plc entered into a £350 000 000 subordinated loan at a rate of 9.125% (2033 loan) with Investec plc. Interest, after the initial short-period distribution paid on 6 March 2023, is paid annually commencing on 6 March 2024 and ending on the maturity date. The loan may be prepaid on any date in the period from 6 December 2027 to (and including) 6 March 2028 subject to conditions. If the option to prepay is not exercised, the loan will be repaid on the maturity date of 6 March 2033. 211 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 40. #### Ordinary share capital | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Group and Company | | | | | At 31 March | 2025 | | 2024 | | | £’000 | | | | Authorised | | | | | | The authorised share capital is £2 000 million (2024: £2 000 million) comprising: | | | | | | 2 000 million ordinary shares of £1 each (2024 : 2 000 million ordinary shares of £1 each) | | | | | | Issued, allotted and fully paid | | | | | | Number of ordinary shares | Number | | Number | | | At the beginning of the year | 1 280 550 000 | | 1 280 550 000 | | | Issued during the year | — | | — | | | At the end of the year | 1 280 550 000 | | 1 280 550 000 | | | Nominal value of ordinary shares | £’000 | | £’000 | | | At the beginning of the year | 1 280 550 | | 1 280 550 | | | Issued during the year | — | | — | | | At the end of the year | 1 280 550 | | 1 280 550 | | 41. #### Other reserves Fair value reserve This comprises all fair value adjustments relating to investments in debt instruments and equity investments that are subsequently measured at FVOCI. When the debt instrument is derecognised, the cumulative gain or loss is reclassified from equity to profit or loss. For investments in equity instruments the cumulative gain or loss is not recycled, but is reclassified within equity on derecognition. Cash flow hedge reserve This comprises the effective portion of the gain or loss on hedging instruments designated as cash flow hedges. Foreign currency reserve This represents the cumulative foreign exchange differences that arise on the translation of an entity with a different functional currency than the presentation currency of the parent company. The cumulative reserve relating to a subsidiary or associate company or joint venture that is disposed of is included in the determination of profit/loss on disposal of the subsidiary, associate company or joint venture. 212 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 42. #### Additional Tier 1 securities in issue | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Fixed Rate Reset Perpetual Additional Tier 1 Write Down Capital Securities | 350 000 | | 458 108 | | 350 000 | | 458 108 | | On 16 October 2017, Investec Bank plc issued £200 million Fixed Rate Reset Perpetual Additional Tier 1 Write Down Capital Securities to Investec plc. These securities were perpetual and paid a distribution rate on 5 March, June, September and December, commencing from 5 December 2017. The distribution was set at 6.75% per annum until December 2024. A further £50 million was issued was on 22 January 2019 and paid a distribution rate of 6.75% per annum quarterly, after the initial short period distribution paid on 5 March 2019. On 1 March 2024, the Company bought back £142 million of these securities and redeemed the remaining balance of £108 million on the first optional call date on 5 December 2024. On 28 February 2024, Investec Bank plc issued £350 million of Fixed Rate Reset Perpetual Additional Tier 1 Write Down Capital Securities at par to Investec plc. These securities are perpetual and pay interest on a semi-annual basis on 28 February and 28 August each year, commencing on 28 August 2024. At each interest payment date, Investec Bank plc can decide whether to pay the coupon, which is non-cumulative, in whole or in part. The interest rate is 10.50% per annum until 28 February 2030; thereafter it resets every subsequent five years to a rate of 6.566% per annum plus the benchmark gilt rate. The securities will be automatically written down and the investors will lose their entire investment in the securities should the CET1 capital ratio of the Investec plc group, as defined in the PRA’s rules, fall below 7%. The securities are redeemable at the option of the Company on any day falling in the period from (and including) 28 August 2029 to (and including) 28 February 2030 or on any day falling in the period of six months prior to (and including) any five year reset date thereafter. No such redemption may be made without the consent of the PRA. 43. #### Non-controlling interests | | | | | | | --- | --- | --- | --- | --- | | | | | | | | At 31 March | 2025 | | 2024 | | | £’000 | | | | Group | | | | | | Non-controlling interests in partially held subsidiaries | 1 196 | | 2 851 | | The decrease in non-controlling interests in the current year primarily relates to Investec Continental Europe Advisory which is now accounted for as 100% held. 213 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 44. #### Finance lease disclosures | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | 2025 | | | 2024 | | | | At 31 March | Total future minimum payments | Present value | | Total future minimum payments | Present value | | | £’000 | | | | Group | | | | | | | | Finance lease receivables included in loans and advances to customers | | | | | | | | Lease receivables due in: | | | | | | | | Less than one year | 246 608 | 190 729 | | 231 750 | 183 405 | | | One to two years | 198 341 | 161 565 | | 174 095 | 142 619 | | | Two to three years | 138 866 | 118 133 | | 122 889 | 104 657 | | | Three to four years | 83 569 | 73 930 | | 74 590 | 65 667 | | | Four to five years | 39 410 | 36 341 | | 32 985 | 29 837 | | | Later than five years | 7 511 | 6 722 | | 11 443 | 10 059 | | | | 714 305 | 587 420 | | 647 752 | 536 244 | | | Unearned finance income | (126 885) | | | (111 508) | | | | Net investment in the lease | 587 420 | | | 536 244 | | | At 31 March 2025 , unguaranteed residual values accruing to the benefit of the Group were £9.8 million ( 2024 : £5.9 million). Finance leases in the Group mainly relate to leases on property, equipment and motor vehicles. Reconciliation of movement in the year | | | | | | --- | --- | --- | --- | | | | | | | At 31 March | 2025 | | 2024 | | £’000 | | | At the beginning of the year | 536 244 | | 517 832 | | New leases | 301 978 | | 290 426 | | Lease payments received | (280 378) | | (281 834) | | Interest on finance lease receivables | 62 914 | | 53 464 | | Terminations | (33 338) | | (43 644) | | At the end of the year | 587 420 | | 536 244 | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | 2025 | | | 2024^ | | | | At 31 March | Total future minimum payments | Present value | | Total future minimum payments | Present value | | | £’000 | | | | Group | | | | | | | | Finance lease receivables included in other assets | | | | | | | | Lease receivables due in: | | | | | | | | Less than one year | 1 270 | 1 258 | | 38 116 | 35 640 | | | One to two years | 1 272 | 1 268 | | 132 412 | 122 614 | | | Two to three years | 1 060 | 1 058 | | 1 298 | 1 291 | | | Three to four years | — | — | | 1 082 | 1 083 | | | | 3 602 | 3 584 | | 172 908 | 160 628 | | | Unearned finance income | (18) | | | (12 280) | | | | Net investment in the lease | 3 584 | | | 160 628 | | | ^Restated as detailed in note 57. Included in interest income on the income statement is £27 million ( 2024 : £30.8 million) from finance lease receivables. The reduction in the year is mainly due to a lease modification for aircraft leasing which resulted in the finance lease changing to an operating lease. The Company has no finance lease receivables at 31 March 2025 ( 31 March 2024 : £nil). 214 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 45. #### Notes to the cash flow statement | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024^ | | 2025 | | 2024 | | | £’000 | | | | | | Profit before taxation adjusted for non-cash items and other required adjustments is derived as follows: | | | | | | | | | | Profit before taxation | 446 848 | | 827 699 | | 335 497 | | 699 640 | | | Adjustment for non-cash items included in net income before taxation: | | | | | | | | | | Impairment of subsidiaries | — | | — | | 11 000 | | 27 506 | | | Amortisation of acquired intangibles | — | | 7 364 | | — | | — | | | Net gain on step acquisition of subsidiaries | — | | (4 063) | | — | | — | | | Net gain on deconsolidation, disposal and liquidation of subsidiaries | — | | (365 506) | | (453) | | (346 259) | | | Depreciation of operating lease assets | 17 | | 28 | | — | | — | | | Depreciation and impairment of property, equipment, software and other intangibles | 21 774 | | 24 196 | | 10 937 | | 14 142 | | | Expected credit loss impairment charges | 97 040 | | 85 997 | | 84 989 | | 67 340 | | | Share of post-taxation profit of associates and joint venture holdings | (38 081) | | (9 032) | | — | | — | | | Dividends received from subsidiaries | — | | — | | (80 769) | | (79 798) | | | Dividends received from associates and joint venture holdings | 24 173 | | 228 | | (24 051) | | — | | | Share-based payments and employee benefit liability recognised | 1 067 | | 183 | | (609) | | (245) | | | Profit before taxation adjusted for non-cash items | 552 838 | | 567 094 | | 336 541 | | 382 326 | | | Increase in operating assets | | | | | | | | | | Loans and advances to banks | 5 208 | | 278 | | 5 212 | | 15 611 | | | Reverse repurchase agreements and cash collateral on securities borrowed | (500 651) | | 198 582 | | (500 651) | | 198 582 | | | Sovereign debt securities | (596 568) | | (706 390) | | (417 776) | | (704 683) | | | Bank debt securities | (26 936) | | (92 601) | | (34 660) | | (88 977) | | | Other debt securities | (62 795) | | (10 860) | | 19 711 | | (10 827) | | | Derivative financial instruments | 90 872 | | 205 107 | | 93 739 | | 201 565 | | | Securities arising from trading activities | 7 420 | | (29 795) | | 7 420 | | (29 795) | | | Investment portfolio | (10 957) | | 70 778 | | (11 745) | | 5 757 | | | Other loans and advances | (17 343) | | 26 605 | | (30 738) | | (112 044) | | | Loans and advances to customers | (341 166) | | (1 092 955) | | (184 561) | | (936 715) | | | Securitised assets | 66 702 | | 11 529 | | 468 | | 3 537 | | | Other assets | 69 073 | | (51 482) | | 59 194 | | (1 686) | | | Goodwill | — | | 200 | | — | | — | | | | (1 317 141) | | (1 471 004) | | (994 387) | | (1 459 675) | | | (Decrease)/increase in operating liabilities | | | | | | | | | | Deposits by banks | (696 737) | | 2 112 | | (589 125) | | 33 940 | | | Derivative financial instruments | (134 464) | | (236 611) | | (161 766) | | (235 925) | | | Other trading liabilities | (2 207) | | (9 735) | | (2 207) | | (9 735) | | | Repurchase agreements and cash collateral on securities lent | 93 111 | | (54 438) | | 93 087 | | (54 082) | | | Customer accounts | 704 228 | | 1 599 817 | | 231 568 | | 1 766 795 | | | Debt securities in issue | 17 484 | | (183 992) | | 17 482 | | (184 002) | | | Liabilities arising on securitisation of other assets | (71 751) | | (9 858) | | — | | — | | | Other liabilities | (42 511) | | 166 465 | | (16 509) | | 113 416 | | | | (132 847) | | 1 273 760 | | (427 470) | | 1 430 407 | | ^Restated as detailed in note 57. 215 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 46. #### Commitments | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Undrawn facilities | 2 477 158 | | 2 327 114 | | 2 429 944 | | 2 278 830 | | | Other commitments | 65 550 | | 34 075 | | — | | — | | | | 2 542 708 | | 2 361 189 | | 2 429 944 | | 2 278 830 | | Expected credit losses (ECL) of £8 million (2024 : £8 million) arising on commitments are reported in other liabilities. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Carrying amount of pledged assets | | | | Related liability | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Group | | | | | | | | | | Pledged assets | | | | | | | | | | Loans and advances to banks | 48 103 | | 19 008 | | 89 736 | | 12 367 | | | Sovereign debt securities | 177 855 | | 28 362 | | 86 245 | | 16 852 | | | Bank debt securities | 14 872 | | 39 187 | | 7 212 | | 23 284 | | | Securities arising from trading activities | 9 213 | | 29 310 | | 8 538 | | 27 398 | | | Loans and advances to customers | 921 737 | | 1 255 309 | | 446 966 | | 745 873 | | | Other loans and advances | 501 | | 2 504 | | 935 | | 1 629 | | | | 1 172 281 | | 1 373 680 | | 639 632 | | 827 403 | | | Company | | | | | | | | | | Pledged assets | | | | | | | | | | Loans and advances to banks | 48 103 | | 19 008 | | 89 736 | | 12 367 | | | Sovereign debt securities | 177 855 | | 28 362 | | 88 972 | | 17 721 | | | Bank debt securities | 14 872 | | 39 187 | | 5 988 | | 23 180 | | | Other debt securities | 624 085 | | 705 788 | | 312 198 | | 440 984 | | | Securities arising from trading activities | 9 213 | | 29 310 | | 8 538 | | 27 398 | | | Loans and advances to customers | 921 737 | | 1 255 309 | | 461 098 | | 784 331 | | | Other loans and advances | 501 | | 2 504 | | 935 | | 1 629 | | | | 1 796 366 | | 2 079 468 | | 967 465 | | 1 307 610 | | The assets pledged by the Group and Company are strictly for the purpose of providing collateral for the counterparty. 216 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 47. #### Contingent liabilities, legal matters and provisions | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Group | | | | Company | | | | | At 31 March | 2025 | | 2024 | | 2025 | | 2024 | | | £’000 | | | | | | Guarantees and assets pledged as collateral security: | | | | | | | | | | Guarantees and irrevocable letters of credit | 498 694 | | 494 356 | | 493 183 | | 496 151 | | | | 498 694 | | 494 356 | | 493 183 | | 496 151 | | Expected credit losses (ECL) of £2 million (2024: £3 million) arising on contingent liabilities, legal matters and provisions are reported in other liabilities. In addition to guarantees, irrevocable letters of credit, credit derivative instruments, undrawn facilities and other commitments, the Group includes in its off-balance sheet exposures for risk management purposes £72 million (2024: £78 million) of potential or revocable exposures and similar arrangements that may arise in future, resulting in additional credit risk. Guarantees are issued by Investec Bank plc on behalf of third parties and other Group companies. The guarantees are issued as part of the banking business. Support is provided by Investec Bank plc to its subsidiaries where appropriate. Financial Services Compensation Scheme The Financial Services Compensation Scheme (FSCS), the UK’s statutory fund of last resort, provides compensation to customers of UK authorised financial institutions in the event that an institution which is a participating member of the FSCS is unable, or is likely to be unable, to pay claims against it. The FSCS raises annual levies from participating members based on their level of participation (in the case of deposits, the proportion that their protected deposits represent to total protected deposits) as at 31 December of the year preceding the scheme year. Investec Bank plc is a participating member of the FSCS. At the date of these financial statements, it is not possible to estimate whether there will ultimately be additional levies on the industry, the level of Group’s market participation or other factors that may affect the amounts or timing of amounts that may ultimately become payable, nor the effect that such levies may have upon operating results in any particular financial period. 217 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 47. #### Contingent liabilities, legal matters and provisions #### (continued) Legal and regulatory matters The Group operates in a legal and regulatory environment that exposes it to legal, regulatory and litigation risks. As a result, the Group is involved in disputes, legal proceedings and is subject to enquiries and examinations, requests for information, audits, investigations and other proceedings by regulators and competition authorities which arise in the ordinary course of business. The Group evaluates all facts, the probability of the outcome of the proceedings and advice from internal and external legal counsel when considering accounting and regulatory implications. At the present time the Group does not expect the ultimate resolution of any of these ongoing regulatory reviews and other matters to have a material adverse effect on its financial position. Historical German dividend tax arbitrage transactions Investec Bank plc has previously been notified by the Office of the Public Prosecutor in Cologne, Germany, that it and certain of its current and former employees may be involved in possible charges relating to historical involvement in German dividend tax arbitrage transactions (known as cum-ex transactions). Investigations are ongoing and no formal proceedings have been issued against Investec Bank plc by the Office of the Public Prosecutor. In addition, Investec Bank plc received certain enquiries in respect of client tax reclaims for the periods 2010 - 2011 relating to the historical German dividend arbitrage transactions from the German Federal Tax Office (FTO) in Bonn. The FTO has provided more information in relation to their claims and Investec Bank plc has sought further information and clarification. Investec Bank plc is cooperating with the German authorities and continues to conduct its own internal investigation into the matters in question. A provision is held to reflect the estimate of financial outflows that could arise as a result of this matter and is reassessed at each reporting date. There are factual issues to be resolved which may have legal consequences, including financial penalties. In relation to potential civil claims; whilst Investec Bank plc is not a claimant nor a defendant to any civil claims in respect of cum-ex transactions, Investec Bank plc has received third-party notices in relation to two civil proceedings in Germany and may elect to join the proceedings as a third-party participant. Investec Bank plc has itself served third-party notices on various participants to these historic transactions in order to preserve the statute of limitations on any potential future claims that Investec Bank plc may seek to bring against those parties, should Investec Bank plc incur any liability in the future. Investec Bank plc has also entered into standstill agreements with some third parties in order to suspend the limitation period in respect of the potential civil claims. While Investec Bank plc is not a claimant nor a defendant to any civil claims at this stage, it cannot rule out the possibility of civil claims by or against Investec Bank plc in future in relation to the relevant transactions. The Group has not provided further disclosure with respect to these historical dividend arbitrage transactions because it has concluded that such disclosure may be expected to seriously prejudice its outcome. Motor finance commission review Investec Group (the Group) notes the recent Court of Appeal decisions on Wrench, Johnson and Hopcraft relating to motor commission arrangements and the lender’s appeal to the UK Supreme Court which was heard on 1 April to 3 April 2025. Judgement is expected by July 2025. The Court of Appeal has determined that motor dealers acting as credit brokers owe certain duties to disclose to their customers commission payable to them by lenders, and that lenders may have primary or secondary liability for motor dealers' non- disclosures. This sets a higher bar for the disclosure of and consent to the existence, nature, and quantum of any commission paid than had been understood to be required or applied across the motor finance industry prior to the Court of Appeal ruling. Our approach to compliant disclosure was built on FCA / regulatory guidance and previous legal authorities. These decisions relate to commission disclosures and consent obligations which go beyond the scope of the current FCA motor commissions review. The UK Supreme Court granted relevant lenders permission to appeal the Wrench, Johnson and Hopcraft judgement on 1 April to 3 April 2025, to which we are awaiting the outcome from. In establishing the provision estimate, the Group has created a number of scenarios to address uncertainties around a number of key assumptions. These include the potential outcomes of the UK Supreme Court appeal, any steps that the FCA may take and outcomes in relation to the extent of harm and remedies. Other key assumptions include applicable commission models, commission rates, time periods, response rates, uphold rates, levels of redress/interest applied and costs to deliver. Based on this approach the Group has concluded that the £30 million provision still remains appropriate based on information currently available. The Group will continue to assess developments and potential impacts, including the outcome of the appeals, any announcement by the FCA of their next steps, and any action by other regulators or government bodies. Given that there is significant uncertainty across the motor finance industry as to the extent of any misconduct and customer loss that may be identified, and/or the nature, extent and timing of any remediation action that may subsequently be required following the Court of Appeal decision and FCA motor commission review. The Group therefore notes that the ultimate financial impact of the Court of Appeal decision and ongoing FCA investigation into motor commission arrangements could materially vary, pending further guidance from the FCA or the outcome of the appeal to the Supreme Court. 218 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 48. #### Related party transactions | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year to 31 March | 2025 | | 2024 | | | £’000 | | | | Compensation of key management personnel and directors | | | | | | Details of directors’ remuneration and interest in shares, including the disclosures required by IAS 24 | | | | | | Related party transactions for the compensation of key management personnel and directors are disclosed in the directors’ remuneration report on pages [96](#i447e4d363cd344738300acdd42f0e3a0_250) to [105](#ifa72657b73544d8db616102e7ba11496_35534). | | | | | | Transactions, arrangements and agreements involving directors and others: | | | | | | Transactions, arrangements and agreements involving directors and with directors and connected persons and companies controlled by them, and with officers of the Company, were as follows: | | | | | | Group and Company | | | | | | Directors, key management and connected persons and companies controlled by them | | | | | | Loans | | | | | | At the beginning of the year | 13 173 | | 8 108 | | | Increase in loans\* | 309 | | 5 658 | | | Decrease in loans\* | (4 101) | | (1 421) | | | Exchange adjustments | 339 | | 828 | | | At the end of the year | 9 720 | | 13 173 | | | Guarantees | | | | | | At the beginning of the year | — | | 100 | | | Decrease in guarantees\* | — | | (94) | | | Exchange adjustments | — | | (6) | | | At the end of the year | — | | — | | | Deposits | | | | | | At the beginning of the year | 5 276 | | 6 502 | | | Increase in deposits | 1 024 | | 1 394 | | | Decrease in deposits\* | (1 797) | | (2 080) | | | Exchange adjustments | (116) | | (540) | | | At the end of the year | 4 387 | | 5 276 | | \*Movements primarily relate to normal course of business and changes in directorship during the current year. The above transactions were made in the ordinary course of business and on substantially the same terms, including interest rates and security, as for comparable arm’s length transactions with persons of a similar standing or, where applicable, with other employees. The transactions did not involve more than the normal risk of repayment. None of these loans have been impaired. 219 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 48. #### Related party transactions #### (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year ended 31 March 2025 | Investec plc and subsidiaries | Investec Limited and subsidiaries | Total | | | £’000 | | | Group | | | | | | Balances with other related parties | | | | | | Assets | | | | | | Loans and advances to banks | — | 1 046 | 1 046 | | | Derivative financial instruments | 26 604 | 1 | 26 605 | | | Other loans and advances | 23 670 | 125 | 23 795 | | | Other assets | 338 | 4 954 | 5 292 | | | Liabilities | | | | | | Deposits by banks | — | 21 331 | 21 331 | | | Derivative financial instruments | — | 18 | 18 | | | Customer accounts (deposits) | 99 859 | 7 156 | 107 015 | | | Debt securities in issue | — | 12 772 | 12 772 | | | Other liabilities | — | 2 | 2 | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year ended 31 March 2024 | Investec plc and subsidiaries | Investec Limited and subsidiaries | Total | | | £’000 | | | Group | | | | | | Balances with other related parties | | | | | | Assets | | | | | | Loans and advances to banks | — | 538 | 538 | | | Derivative financial instruments | 37 580 | — | 37 580 | | | Other loans and advances | 28 030 | — | 28 030 | | | Other assets | 3 495 | — | 3 495 | | | Liabilities | | | | | | Deposits by banks | — | 24 053 | 24 053 | | | Derivative financial instruments | — | 64 | 64 | | | Customer accounts (deposits) | 60 604 | 6 857 | 67 461 | | | Debt securities in issue | — | 12 150 | 12 150 | | | Other liabilities | — | 499 | 499 | | The above outstanding balances arose in the ordinary course of business and on substantially the same terms, including interest rates and security, as for comparable transactions with third party counterparties. In the normal course of business, services are provided between Investec Bank plc and other companies in the Investec Group. In the year to 31 March 2025, Investec Bank plc paid a net amount of £36 million ( 2024: £25.8 million) to Investec Limited and its subsidiaries and received a net amount of £10.3 million (2024 : £4.9 million) from Investec plc and its subsidiaries for these services. During the year to 31 March 2025, interest of £1 million (2024 : £1.2 million) was paid to entities held by Investec Limited and £9.9 million (2024: £7.5 million) was paid to Investec plc and its subsidiaries. Interest of £87 000 (2024: £188 000) was received from Investec Limited and its subsidiaries and interest of £18 million (2024: £19 million) was received from Investec plc and its subsidiaries. During the year to 31 March 2025, the Group paid £2.4 million (2024: £767 000) for services rendered in the ordinary course of business and received £26.5 million (2024: £9.5 million) from associates and joint venture holdings. Due to the nature of the Group’s business, there could be transactions with entities where some of the Group’s directors may be mutual directors. These transactions are in the ordinary course of business and are on an arm’s length basis. 220 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 48. #### Related party transactions #### (continued) Balances and transactions between members of the Investec Bank plc Group In accordance with IFRS 10 Consolidated Financial Statements, transactions and balances between the Company and its subsidiary undertakings, and between those subsidiary undertakings, have all been eliminated on consolidation and thus are not reported as related party transactions of the Group. The Company, as a result of its position as parent of a Banking Group, has a large number of transactions with various of its subsidiary undertakings; these are included on the balance sheet of the Company as follows: | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year ended 31 March | 2025 | | 2024 | | | £’000 | | | | Company | | | | | | Assets | | | | | | Loans and advances to banks | 119 112 | | 31 302 | | | Other debt securities | 625 065 | | 706 138 | | | Derivative financial instruments | 16 147 | | 1 893 | | | Other loans and advances | 3 177 624 | | 3 166 274 | | | Other assets | 6 507 | | 7 366 | | | Liabilities | | | | | | Deposits by banks | 501 423 | | 408 044 | | | Derivative financial instruments | 4 521 | | 39 391 | | | Customer accounts (deposits) | 1 340 326 | | 1 393 875 | | | Repurchase agreements and cash collateral on securities lent | 150 332 | | 150 356 | | | Other liabilities | 41 096 | | 25 277 | | Balances and transactions with Investec plc and Investec Limited and fellow subsidiaries of Investec Bank plc The Company and its subsidiaries have balances due to and from its Parent company, Investec plc, and Investec Limited and fellow subsidiaries. These are included on the balance sheet as follows: | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year ended 31 March 2025 | Investec plc and subsidiaries | Investec Limited and subsidiaries | Total | | | £’000 | | | Company | | | | | | Balances with other related parties | | | | | | Assets | | | | | | Derivative financial instruments | 26 604 | 1 | 26 605 | | | Other loans and advances | 23 670 | 125 | 23 795 | | | Other assets | 5 725 | 3 813 | 9 538 | | | Liabilities | | | | | | Deposits by banks | — | 21 331 | 21 331 | | | Derivative financial instruments | — | 18 | 18 | | | Customer accounts (deposits) | 84 570 | 6 814 | 91 384 | | | Debt securities in issue | — | 12 772 | 12 772 | | 221 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 48. #### Related party transactions #### (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year ended 31 March 2024 | Investec plc and subsidiaries | Investec Limited and subsidiaries | Total | | | £’000 | | | Company | | | | | | Balances with other related parties | | | | | | Assets | | | | | | Derivative financial instruments | 37 580 | — | 37 580 | | | Other loans and advances | 28 030 | — | 28 030 | | | Other assets | 4 294 | 3 302 | 7 596 | | | Liabilities | | | | | | Deposits by banks | — | 24 053 | 24 053 | | | Derivative financial instruments | — | 64 | 64 | | | Customer accounts (deposits) | 46 065 | 6 856 | 52 921 | | | Debt securities in issue | — | 12 150 | 12 150 | | | Other liabilities | — | 358 | 358 | | The below outstanding balances arose from the ordinary course of business and on substantially the same terms, including interest rates and security, as for comparable transactions with third party counterparties. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | For the year ended 31 March | 2025 | | 2024 | | | £’000 | | | | Group and Company | | | | | | Amounts due from associates | 13 833 | | — | | 222 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 49. #### Hedges The Group uses derivatives for the management of financial risks relating to its asset and liability portfolios, mainly associated with non-trading interest rate risks and exposures to foreign currency risk. Most non-trading interest rate risk is transferred from the originating business to the Central Treasury in the Specialist Bank. Once aggregated and netted, Central Treasury actively manages the liquidity mismatch and non-trading interest rate risk from our asset and liability portfolios. In this regard, Treasury is required to exercise tight control of funding, liquidity, concentration and non-trading interest rate risk within defined parameters. The accounting treatment of accounting hedges is dependent on the requirement to identify a direct relationship between a hedged item and hedging instrument. Below is a description of each category of accounting hedges achieved by the Group. In addition to fair value hedges and cash flow hedges, the Group maintains a structural hedging programme to reduce the sensitivity of earnings to short-term interest rate movements. For more detail refer to page [283](#icd4ee75502c2463ea93e90de1b2ebc08_8889). Fair value hedges Fair value hedges are entered into mainly to hedge the exposure of changes in fair value of fixed rate financial instruments attributable to interest rates. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | At 31 March | Description of financial instrument designated as hedging instrument (All included within derivative financial instruments on the balance sheet) | Notional value of hedging instrument | Fair value of hedging instrument | Cumulative fair value gains or (losses) on hedging instrument | Current year fair value gains or (losses) on hedging instrument\* | Cumulative fair value gains or (losses) on hedged item | Current year fair value gains or (losses) on hedged item\* # ^ | | | £’000 | | | Group | | | | | | | | | | 2025 | | | | | | | | | | Assets | Interest rate swap | 2 362 156 | 83 841 | 83 841 | (49 132) | (78 319) | 49 537 | | | Liabilities | Interest rate swap | 4 611 982 | (26 229) | (26 229) | 35 647 | 26 044 | (37 097) | | | | | 6 974 138 | 57 612 | 57 612 | (13 485) | (52 275) | 12 440 | | | 2024 | | | | | | | | | | Assets | Interest rate swap | 2 371 336 | 126 798 | 132 974 | (54 334) | (127 854) | 69 919 | | | Liabilities | Interest rate swap | 6 387 935 | (61 876) | (61 876) | 35 364 | 63 141 | (32 760) | | | | | 8 759 271 | 64 922 | 71 098 | (18 970) | (64 713) | 37 159 | | \*Change in fair value used as the basis for recognising hedge effectiveness for the period. #Included in 'Current year fair value gains or losses on hedged item' is a £12.5 million gain (2024, £19.8 million gain) due to the amortisation subsequent to de- designation of accumulated fair value hedge adjustments related to the structural hedging programme undertaken in December 2022. ^For the purpose of the information presented in this table only, the 2024 'Current year fair value gains or (losses) on hedged item' has been updated to reflect the inclusion of the structural hedging programme cumulative balance (£39.5 million) to be consistent with 2024 and 2025 cumulative balance presentation. This cumulative balance was not previously included in 2023. Hedge effectiveness is determined with reference to retrospective and prospective testing, but to the extent hedging instruments are exposed to different risks than the hedged items, this could result in hedge ineffectiveness. Sources of ineffectiveness include the following: • Mismatches between the contractual terms of the hedged item and hedging instrument, including basis differences • If a hedging relationship becomes over-hedged, for example, if the hedged item is partially redeemed but the original hedging instrument remains in place. Included within balance sheet management and other trading activities in the income statement is a £9 million loss (2024: £1.5 million gain) arising from hedge ineffectiveness. Included in ‘current year fair value gains or (losses) on hedged item' is a £4.6 million loss related to a debt issuance buyback during the year, being the reversal of the cumulative fair value gain of £4.6 million recognised up to the buyback date. There are no accumulated fair value hedge adjustments on matured hedged items. In circumstances where the hedged item has been de-designated but remains on balance sheet i.e. as part of the structural hedging programme, any accumulated fair value hedge adjustments shall be recognised in the income statement over the remaining life of the hedged item. 223 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 49. #### Hedges #### (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Carrying amount of the hedged item | | | | | At 31 March | 2025 | | 2024 | | | £’000 | | | | Hedged items | | | | | | Group | | | | | | Assets | | | | | | Sovereign debt securities | 311 905 | | 77 888 | | | Bank debt securities | 5 295 | | 21 130 | | | Other debt securities | 15 754 | | 13 584 | | | Loans and advances to customers | 2 012 683 | | 2 038 635 | | | Other assets\* | — | | 56 668 | | | Liabilities | | | | | | Debt securities in issue | 794 101 | | 757 282 | | | Customer accounts (deposits) | 3 267 390 | | 4 922 286 | | | Subordinated liabilities | 699 940 | | 700 000 | | \* Other assets includes aviation leasing related hedges. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | At 31 March | Up to one month | One month to three months | Three months to six months | Six months to one year | One to five years | Greater than five years | Total | | | £’000 | | | Maturity analysis of hedged items^ | | | | | | | | | | Group | | | | | | | | | | 2025 | | | | | | | | | | Assets – notionals | | | | | | | | | | Sovereign debt securities | — | — | — | 8 000 | 275 500 | 29 500 | 313 000 | | | Bank debt securities | — | — | — | — | 5 000 | — | 5 000 | | | Other debt securities | — | — | — | — | 15 473 | — | 15 473 | | | Loans and advances to customers | 1 588 | 15 668 | 36 388 | 97 283 | 1 495 554 | 366 203 | 2 012 684 | | | Other assets\* | — | — | — | — | — | — | — | | | Liabilities – notionals | | | | | | | | | | Debt securities in issue | — | — | — | 3 389 | 389 175 | 418 409 | 810 973 | | | Customer accounts (deposits) | 139 487 | 378 265 | 787 983 | 1 931 462 | 20 000 | 10 193 | 3 267 390 | | | Subordinated liabilities | — | — | — | — | — | 700 000 | 700 000 | | | 2024 | | | | | | | | | | Assets – notionals | | | | | | | | | | Sovereign debt securities | — | — | — | 8 000 | 64 000 | 10 000 | 82 000 | | | Bank debt securities | — | — | — | — | 22 000 | — | 22 000 | | | Other debt securities | — | — | — | — | 10 420 | 3 164 | 13 584 | | | Loans and advances to customers | 8 901 | 47 443 | 74 758 | 135 433 | 1 333 782 | 438 317 | 2 038 634 | | | Other assets\* | 2 818 | 5 661 | 8 566 | 17 411 | 22 212 | — | 56 668 | | | Liabilities – notionals | | | | | | | | | | Debt securities in issue | — | — | — | 30 | 783 366 | — | 783 396 | | | Customer accounts (deposits) | | 132 111 | 1 006 825 | 2 989 176 | 787 048 | 7 125 | 4 922 285 | | | Subordinated liabilities | — | — | — | — | — | 700 000 | 700 000 | | \* Other assets includes aviation leasing related hedges. ^The maturity profile of the hedged items would be materially consistent with the maturity profile of the hedging instruments. 224 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 49. #### Hedges #### (continued) Fair value hedges Fair value hedges are entered into mainly to hedge the exposure of changes in fair value of fixed rate financial instruments attributable to interest rates. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | At 31 March | Description of financial instrument designated as hedging instrument (All included within derivative financial instruments on the balance sheet) | Notional value of hedging instrument | Fair value of hedging instrument | Cumulative fair value gains or (losses) on hedging instrument | Current year fair value gains or (losses) on hedging instrument\* | Cumulative fair value gains or (losses) on hedged item | Current year fair value gains or (losses) on hedged item\* # ^ | | | £’000 | | | Company | | | | | | | | | | 2025 | | | | | | | | | | Assets | Interest rate swap | 2 362 156 | 83 841 | 83 841 | (41 942) | (78 319) | 45 209 | | | Liabilities | Interest rate swap | 4 611 982 | (26 229) | (26 229) | 35 647 | 26 044 | (37 097) | | | | | 6 974 138 | 57 612 | 57 612 | (6 295) | (52 275) | 8 112 | | | 2024 | | | | | | | | | | Assets | Interest rate swap | 2 316 553 | 125 784 | 125 784 | (53 469) | (123 526) | 68 582 | | | Liabilities | Interest rate swap | 6 387 935 | (61 876) | (61 876) | 35 364 | 63 141 | (32 760) | | | | | 8 704 488 | 63 908 | 63 908 | (18 105) | (60 385) | 35 822 | | \*Change in fair value used as the basis for recognising hedge effectiveness for the period. #Included in 'Current year fair value gains or losses on hedged item' is a £12.5 million gain (2024, £19.8 million gain) due to the amortisation subsequent to de- designation of accumulated fair value hedge adjustments related to the structural hedging programme undertaken in December 2022. ^For the purpose of the information presented in this table only, the 2024 'Current year fair value gains or (losses) on hedged item' has been updated to reflect the inclusion of the structural hedging programme cumulative balance (£39.5 million) to be consistent with 2024 and 2025 cumulative balance presentation. This cumulative balance was not previously included in 2023. Hedge effectiveness is determined with reference to retrospective and prospective testing, but to the extent hedging instruments are exposed to different risks than the hedged items, this could result in hedge ineffectiveness. Sources of ineffectiveness include the following: • Mismatches between the contractual terms of the hedged item and hedging instrument, including basis differences • If a hedging relationship becomes over-hedged, for example, if the hedged item is partially redeemed but the original hedging instrument remains in place. Included within balance sheet management and other trading activities in the income statement is a £6.2 million loss (2024: £1.0 million gain) arising from hedge ineffectiveness. Included in ‘current year fair value gains or (losses) on hedged item' is a £4.6 million loss related to a debt issuance buyback during the year, being the reversal of the cumulative fair value gain of £4.6 million recognised up to the buy-back date. There are no accumulated fair value hedge adjustments on matured hedged items. In circumstances where the hedged item has been de-designated but remains On balance sheet i.e. as part of the structural hedging programme, any accumulated fair value hedge adjustments shall be recognised in the income statement over the remaining life of the hedged item. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Carrying amount of the hedged item | | | | | At 31 March | 2025 | | 2024 | | | £’000 | | | | Hedged items | | | | | | Company | | | | | | Assets | | | | | | Sovereign debt securities | 311 905 | | 77 888 | | | Bank debt securities | 5 295 | | 21 130 | | | Other debt securities | 15 754 | | 13 584 | | | Loans and advances to customers | 2 012 683 | | 2 038 635 | | | Liabilities | | | | | | Debt securities in issue | 794 101 | | 757 282 | | | Customer accounts (deposits) | 3 267 390 | | 4 922 286 | | | Subordinated liabilities | 699 940 | | 700 000 | | 225 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 49. #### Hedges #### (continued) | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | At 31 March | Up to one month | One month to three months | Three months to six months | Six months to one year | One to five years | Greater than five years | Total | | | £’000 | | | Maturity analysis of hedged items^ | | | | | | | | | | Company | | | | | | | | | | 2025 | | | | | | | | | | Assets – notionals | | | | | | | | | | Sovereign debt securities | — | — | — | 8 000 | 275 500 | 29 500 | 313 000 | | | Bank debt securities | — | — | — | — | 5 000 | — | 5 000 | | | Other debt securities | — | — | — | — | 15 473 | — | 15 473 | | | Loans and advances to customers | 1 588 | 15 668 | 36 388 | 97 283 | 1 495 554 | 366 203 | 2 012 684 | | | Liabilities – notionals | | | | | | | | | | Debt securities in issue | — | — | — | 3 389 | 389 175 | 418 409 | 810 973 | | | Customer accounts (deposits) | 139 487 | 378 265 | 787 983 | 1 931 462 | 20 000 | 10 193 | 3 267 390 | | | Subordinated liabilities | — | — | — | — | — | 700 000 | 700 000 | | | 2024 | | | | | | | | | | Assets – notionals | | | | | | | | | | Sovereign debt securities | — | — | — | 8 000 | 64 000 | 10 000 | 82 000 | | | Bank debt securities | — | — | — | — | 22 000 | — | 22 000 | | | Other debt securities | — | — | — | — | 10 420 | 3 164 | 13 584 | | | Loans and advances to customers | 8 901 | 47 443 | 74 758 | 135 433 | 1 333 782 | 438 317 | 2 038 634 | | | Liabilities – notionals | | | | | | | | | | Debt securities in issue | — | — | — | 30 | 783 366 | — | 783 396 | | | Customer accounts (deposits) | — | 132 111 | 1 006 825 | 2 989 176 | 787 048 | 7 125 | 4 922 285 | | | Subordinated liabilities | — | — | — | — | — | 700 000 | 700 000 | | ^The maturity profile of the hedged items would be materially consistent with the maturity profile of the hedging instruments. 226 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 49. #### Hedges #### (continued) Cash flow hedges The change in the benchmark interest rate exposes the Group to cash flow variability risk from both existing and highly probable future transactions. During the year the Group entered into interest rate swap transactions to mitigate the cash flow variability risk. The aggregate expected cash flows were hedged based on cash flow forecasts with reference to terms and conditions present in the affected contractual arrangements. Changes in fair value were initially recognised in other comprehensive income and reclassified to the income statement when the cash flows affected the income statement. A reconciliation of the cash flow hedge reserve can be found in the statement of changes in equity. Hedging instruments and ineffectiveness | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 2025 | | | | | | | | | Carrying Amount | | | Change in fair value used to calculate hedge ineffectiveness | Gain/(loss) recognised in OCI | Ineffectiveness (loss) recognised in the income statement\* | | | At 31 March | Notional | Asset | Liability | | | £’000 | | | Group | | | | | | | | | Interest rate risk | | | | | | | | | Interest rate swaps | 350 000 | — | (208) | (3 938) | 3 913 | (25) | | | | 350 000 | — | (208) | (3 938) | 3 913 | (25) | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 2024 | | | | | | | | | Carrying Amount | | | Change in fair value used to calculate hedge ineffectiveness | Gain/(loss) recognised in OCI | Ineffectiveness (loss) recognised in the income statement\* | | | At 31 March | Notional | Asset | Liability | | | £’000 | | | Interest rate risk | | | | | | | | | Interest rate swaps | 350 000 | 3 210 | — | 2 034 | 2 148 | (114) | | | | 350 000 | 3 210 | — | 2 034 | 2 148 | (114) | | \*Hedge ineffectiveness is included in the income statement within trading income arising from balance sheet management and other trading activities. Hedged items in cash flow hedges | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | 2025 | | | | | | Change in fair value used for calculating hedge ineffectiveness | Balance in reserve for continuing hedges | Balance in reserve where hedge accounting is no longer applied | | | At 31 March | | | £’000 | | | Group | | | | | | Loans and advances to customers | 3 632 | 68 | (164) | | | Deposits by banks | 281 | — | (8 800) | | | | 3 913 | 68 | (8 964) | | | | | | | | --- | --- | --- | --- | | | | | | | | 2024 | | | | At 31 March | Change in fair value used for calculating hedge ineffectiveness | Balance in reserve for continuing hedges | Balance in reserve where hedge accounting is no longer applied | | £’000 | | Group | | | | | Loans and advances to customers | (3 781) | (3 563) | (215) | | Deposits by banks | 1 633 | — | (20 755) | | | (2 148) | (3 563) | (20 970) | 227 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 49. #### Hedges #### (continued) Impact of cash flow hedges on profit and loss and other comprehensive income | | | | | | --- | --- | --- | --- | | | | | | | | Cash flow hedge reserve | | | | For the year to | 2025 | 2024 | | | £’000s | | | Group | | | | | Reconciliation from opening balance to closing balance | | | | | At the beginning of the year | 17 664 | 27 635 | | | Gain recognised in other comprehensive income on effective portion of changes in fair value of hedging instruments | (3 913) | 2 148 | | | Gain reclassified to income statement when hedged item affected net profit for de-designated relationships | (4 857) | (5 250) | | | Gain reclassified to income statement where hedged future cash flows are no longer expected to occur | (6 867) | — | | | Taxation charge relating to cash flow hedges | 4 378 | (6 869) | | | At the end of the year | 6 405 | 17 664 | | | Closing balance is comprised of: | | | | | Cash flow hedge reserve before taxation | 8 896 | 24 533 | | | Deferred taxation | (2 491) | (6 869) | | | Cash flow hedge reserve at the end of the year | 6 405 | 17 664 | | 228 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 49 . #### Hedges #### (continued) Hedging instruments and ineffectiveness | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 2025 | | | | | | | | | Carrying Amount | | | Change in fair value used to calculate hedge ineffectiveness | Gain/(loss) recognised in OCI | Ineffectiveness (loss) recognised in the income statement\* | | | At 31 March | Notional | Asset | Liability | | | £’000 | | | Company | | | | | | | | | Interest rate risk | | | | | | | | | Interest rate swaps | 350 000 | — | (208) | (3 938) | 3 913 | (25) | | | | 350 000 | — | (208) | (3 938) | 3 913 | (25) | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 2024 | | | | | | | | | Carrying Amount | | | Change in fair value used to calculate hedge ineffectiveness | Gain/(loss) recognised in OCI | Ineffectiveness (loss) recognised in the income statement\* | | | At 31 March | Notional | Asset | Liability | | | £’000 | | | Interest rate risk | | | | | | | | | Interest rate swaps | 350 000 | 3 210 | — | 2 034 | 2 148 | (114) | | | | 350 000 | 3 210 | — | 2 034 | 2 148 | (114) | | • Hedge ineffectiveness is included in the income statement within trading income arising from balance sheet management and other trading activities. Hedging items in cash flow hedges | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | 2025 | | | | | At 31 March | Change in fair value used for calculating hedge ineffectiveness | Balance in reserve for continuing hedges | Balance in reserve where hedge accounting is no longer applied | | | £’000 | | | Company | | | | | | Loans and advances to customers | 3 632 | 68 | (164) | | | Customer accounts (deposits) | 281 | — | (8 800) | | | | 3 913 | 68 | (8 964) | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | 2024 | | | | | At 31 March | Change in fair value used for calculating hedge ineffectiveness | Balance in reserve for continuing hedges | Balance in reserve where hedge accounting is no longer applied | | | £’000 | | | Company | | | | | | Loans and advances to customers | (3 781) | (3 563) | (215) | | | Customer accounts (deposits) | 1 633 | — | (20 755) | | | | (2 148) | (3 563) | (20 970) | | 229 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 49. #### Hedges #### (continued) Impact of cash flow hedges on profit and loss and other comprehensive income | | | | | | --- | --- | --- | --- | | | | | | | | Cash flow reserve | | | | For the year to | 2025 | 2024 | | | £’000s | | | Company | | | | | Reconciliation from opening balance to closing balance | | | | | At the beginning of the year | 17 664 | 27 635 | | | Gain recognised in other comprehensive income on effective portion of changes in fair value of hedging instruments | (3 913) | 2 148 | | | Gain reclassified to income statement when hedged item affected net profit for de-designated relationships | (4 857) | (5 250) | | | Gain reclassified to income statement where hedged future cash flows are no longer expected to occur | (6 867) | — | | | Taxation charge relating to cash flow hedges | 4 378 | (6 869) | | | At the end of the year | 6 405 | 17 664 | | | Closing balance is comprised of: | | | | | Cash flow hedge reserve before taxation | 8 896 | 24 533 | | | Deferred taxation | (2 491) | (6 869) | | | Cash flow hedge reserve at the end of the year | 6 405 | 17 664 | | 230 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 50. #### Liquidity analysis of financial liabilities based on undiscounted cash flows | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | At 31 March | Carrying value | Demand | Up to one month | One month to three months | Three months to six months | Six months to one year | One year to five years | Greater than five years | Total | | | £’000 | | | Group | | | | | | | | | | | | 2025 | | | | | | | | | | | | Liabilities | | | | | | | | | | | | Deposits by banks | 1 477 568 | 188 434 | 9 784 | 2 968 | 15 327 | 725 509 | 598 848 | — | 1 540 870 | | | Derivative financial instruments | 274 791 | 4 654 | 28 960 | 57 468 | 49 077 | 62 353 | 80 708 | 22 351 | 305 571 | | | Derivative financial instruments – held for trading | | 52 | — | — | — | — | — | — | 52 | | | Derivative financial instruments – held for hedging risk | | 4 602 | 28 960 | 57 468 | 49 077 | 62 353 | 80 708 | 22 351 | 305 519 | | | Other trading liabilities | 16 242 | 16 242 | — | — | — | — | — | — | 16 242 | | | Repurchase agreements and cash collateral on securities lent | 178 202 | 8 514 | 169 663 | 25 | — | — | — | — | 178 202 | | | Customer accounts (deposits) | 21 555 444 | 7 252 301 | 1 208 025 | 6 071 451 | 3 576 557 | 2 402 321 | 1 266 990 | — | 21 777 645 | | | Debt securities in issue | 974 371 | — | 1 799 | 9 898 | 15 377 | 106 105 | 539 060 | 434 770 | 1 107 009 | | | Other liabilities | 509 303 | 52 803 | 315 847 | 29 639 | 10 561 | 62 722 | 37 602 | 129 | 509 303 | | | Subordinated liabilities | 682 218 | — | — | — | — | 41 125 | 164 500 | 814 188 | 1 019 813 | | | Total on-balance sheet liabilities | 25 668 139 | 7 522 948 | 1 734 078 | 6 171 449 | 3 666 899 | 3 400 135 | 2 687 708 | 1 271 438 | 26 454 655 | | | Contingent liabilities | — | 3 065 | 631 | 94 109 | 8 179 | 70 553 | 317 201 | 4 956 | 498 694 | | | Commitments | — | 135 924 | 83 220 | 48 555 | 94 912 | 303 858 | 1 557 630 | 390 359 | 2 614 458 | | | Total liabilities | 25 668 139 | 7 661 937 | 1 817 929 | 6 314 113 | 3 769 990 | 3 774 546 | 4 562 539 | 1 666 753 | 29 567 807 | | The balances in the above table will not agree directly to the balances in the consolidated balance sheet, as the table incorporates all cash flows on an undiscounted basis relating to both principal and those associated with all future coupon payments (except for trading liabilities and trading derivatives). Furthermore, loan commitments are generally not recognised on the balance sheet. The cash flow profile of debt securities in issue above considers modelled early redemptions. Trading liabilities and trading derivatives have been included in the ‘Demand’ time bucket and not by contractual maturity because trading liabilities are typically held for short periods of time. For an unaudited analysis based on discounted cash flows, refer to page [279](#icd4ee75502c2463ea93e90de1b2ebc08_8897) . 231 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 50 . #### Liquidity analysis of financial liabilities based on undiscounted cash flows #### (continued) | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | At 31 March | Carrying value | Demand | Up to one month | One month to three months | Three months to six months | Six months to one year | One year to five years | Greater than five years | Total | | | £’000 | | | Group | | | | | | | | | | | | 2024 | | | | | | | | | | | | Liabilities | | | | | | | | | | | | Deposits by banks | 2 174 305 | 226 716 | 19 659 | 16 494 | 36 318 | 50 188 | 1 981 853 | — | 2 331 228 | | | Derivative financial instruments^ | 409 255 | 4 215 | 46 520 | 56 680 | 74 249 | 101 758 | 144 603 | 18 631 | 446 656 | | | Derivative financial instruments – held for trading | | 757 | — | — | — | — | — | — | 757 | | | Derivative financial instruments – held for hedging risk | | 3 458 | 46 520 | 56 680 | 74 249 | 101 758 | 144 603 | 18 631 | 445 899 | | | Other trading liabilities | 18 449 | 18 449 | — | — | — | — | — | — | 18 449 | | | Repurchase agreements and cash collateral on securities lent | 85 091 | 17 575 | 67 516 | — | — | — | — | — | 85 091 | | | Customer accounts (deposits) | 20 851 216 | 6 193 673 | 2 155 303 | 3 532 546 | 3 352 407 | 4 320 992 | 1 645 384 | — | 21 200 305 | | | Debt securities in issue | 956 887 | — | 6 188 | 24 873 | 42 662 | 66 217 | 909 599 | 1 194 | 1 050 733 | | | Liabilities arising on securitisation of other assets | 71 751 | — | — | 7 154 | 3 462 | 6 540 | 40 251 | 34 570 | 91 977 | | | Other liabilities | 557 111 | 94 540 | 313 160 | 18 928 | 5 275 | 95 155 | 26 980 | 3 073 | 557 111 | | | Subordinated liabilities | 668 810 | — | — | — | — | 41 125 | 164 500 | 855 313 | 1 060 938 | | | Total on-balance sheet liabilities | 25 792 875 | 6 555 168 | 2 608 346 | 3 656 675 | 3 514 373 | 4 681 975 | 4 913 170 | 912 781 | 26 842 488 | | | Contingent liabilities | — | — | 39 441 | 86 687 | 1 766 | 24 139 | 332 829 | 9 493 | 494 355 | | | Commitments | — | 139 830 | 108 511 | 32 337 | 196 253 | 294 082 | 1 282 947 | 384 953 | 2 438 913 | | | Total liabilities | 25 792 875 | 6 694 998 | 2 756 298 | 3 775 699 | 3 712 392 | 5 000 196 | 6 528 946 | 1 307 227 | 29 775 756 | | ^Restated as detailed in note 57. 232 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 50. #### Liquidity analysis of financial liabilities based on undiscounted cash flows #### (continued) | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | At 31 March | Carrying value | Demand | Up to one month | One month to three months | Three months to six months | Six months to one year | One year to five years | Greater than five years | Total | | | £’000 | | | Company | | | | | | | | | | | | 2025 | | | | | | | | | | | | Liabilities | | | | | | | | | | | | Deposits by banks | 1 968 896 | 679 762 | 9 784 | 2 968 | 15 327 | 725 509 | 598 848 | — | 2 032 198 | | | Derivative financial instruments | 267 909 | 9 131 | 26 756 | 54 602 | 47 418 | 60 703 | 77 731 | 22 351 | 298 692 | | | Derivative financial instruments – held for trading | | 4 558 | — | — | — | — | — | — | 4 558 | | | Derivative financial instruments – held for hedging risk | | 4 573 | 26 756 | 54 602 | 47 418 | 60 703 | 77 731 | 22 351 | 294 134 | | | Other trading liabilities | 16 242 | 16 242 | — | — | — | — | — | — | 16 242 | | | Repurchase agreements and cash collateral on securities lent | 328 534 | 8 813 | 169 664 | 150 057 | — | — | — | — | 328 534 | | | Customer accounts (deposits) | 19 952 173 | 5 809 019 | 966 866 | 5 372 158 | 3 454 868 | 2 425 667 | 2 132 159 | — | 20 160 737 | | | Debt securities in issue | 973 176 | — | 1 799 | 9 898 | 15 377 | 106 105 | 539 060 | 433 576 | 1 105 815 | | | Other liabilities | 455 892 | 89 863 | 272 728 | 21 282 | 7 452 | 58 019 | 6 419 | 129 | 455 892 | | | Subordinated liabilities | 682 218 | — | — | — | — | 41 125 | 164 500 | 814 188 | 1 019 813 | | | Total on-balance sheet liabilities | 24 645 040 | 6 612 830 | 1 447 597 | 5 610 965 | 3 540 442 | 3 417 128 | 3 518 717 | 1 270 244 | 25 417 923 | | | Contingent liabilities | — | — | 631 | 90 535 | 15 292 | 65 572 | 315 566 | 5 587 | 493 183 | | | Commitments | — | 43 683 | 83 220 | 47 713 | 93 705 | 302 818 | 1 557 630 | 346 217 | 2 474 986 | | | Total liabilities | 24 645 040 | 6 656 513 | 1 531 448 | 5 749 213 | 3 649 439 | 3 785 518 | 5 391 913 | 1 622 048 | 28 386 092 | | The balances in the above table will not agree directly to the balances in the Company balance sheet, as the table incorporates all cash flows on an undiscounted basis relating to both principal and those associated with all future coupon payments (except for trading liabilities and trading derivatives). Furthermore, loan commitments are generally not recognised on the balance sheet. The cash flow profile of debt securities in issue above considers modelled early redemptions. Trading liabilities and trading derivatives have been included in the ‘Demand’ time bucket and not by contractual maturity because trading liabilities are typically held for short periods of time. 233 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 50 . #### Liquidity analysis of financial liabilities based on undiscounted cash flows #### (continued) | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | At 31 March | Carrying value | Demand | Up to one month | One month to three months | Three months to six months | Six months to one year | One year to five years | Greater than five years | Total | | | £’000 | | | Company | | | | | | | | | | | | 2024 | | | | | | | | | | | | Liabilities | | | | | | | | | | | | Deposits by banks | 2 558 021 | 629 347 | 19 659 | 6 301 | 27 596 | 50 188 | 1 981 853 | — | 2 714 944 | | | Derivative financial instruments | 429 675 | 43 583 | 45 189 | 53 741 | 72 231 | 96 139 | 137 855 | 18 337 | 467 075 | | | Derivative financial instruments – held for trading | | 40 125 | — | — | — | — | — | — | 40 125 | | | Derivative financial instruments – held for hedging risk | | 3 458 | 45 189 | 53 741 | 72 231 | 96 139 | 137 855 | 18 337 | 426 950 | | | Other trading liabilities | 18 449 | 18 449 | — | — | — | — | — | — | 18 449 | | | Repurchase agreements and cash collateral on securities lent | 235 447 | 17 874 | 67 516 | 150 057 | — | — | — | — | 235 447 | | | Customer accounts (deposits) | 19 720 605 | 5 046 705 | 1 961 070 | 2 880 713 | 3 267 206 | 4 374 430 | 2 524 491 | — | 20 054 615 | | | Debt securities in issue | 955 694 | — | 6 188 | 24 872 | 42 662 | 66 217 | 909 599 | — | 1 049 538 | | | Other liabilities | 468 790 | 113 269 | 270 203 | 9 868 | 2 628 | 62 747 | 10 035 | 40 | 468 790 | | | Subordinated liabilities | 668 810 | — | — | — | — | 41 125 | 164 500 | 855 313 | 1 060 938 | | | Total on-balance sheet liabilities | 25 055 491 | 5 869 227 | 2 369 825 | 3 125 552 | 3 412 323 | 4 690 846 | 5 728 333 | 873 690 | 26 069 796 | | | Contingent liabilities | — | — | 40 085 | 86 655 | — | 20 144 | 339 773 | 9 493 | 496 150 | | | Commitments | — | 67 530 | 90 701 | 29 167 | 184 809 | 290 974 | 1 275 989 | 384 953 | 2 324 123 | | | Total liabilities | 25 055 491 | 5 936 757 | 2 500 611 | 3 241 374 | 3 597 132 | 5 001 964 | 7 344 095 | 1 268 136 | 28 890 069 | | 234 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 51. #### Principal subsidiaries and associated companies and joint venture holdings – #### Investec Bank plc | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Interest | | | | | At 31 March | Principal activity | Country of incorporation | 2025 | | 2024 | | | Direct subsidiaries of Investec Bank plc | | | | | | | | Investec Investments (UK) Limited | Investment holding | England and Wales | 100% | | 100% | | | Investec Asset Finance plc | Leasing | England and Wales | 100% | | 100% | | | Investec Bank (Channel Islands) Limited | Banking institution | Guernsey | 100% | | 100% | | | Investec Bank (Switzerland) AG | Banking institution and wealth manager | Switzerland | 100% | | 100% | | | Investec Group Investments (UK) Limited | Investment holding | England and Wales | 100% | | 100% | | | Investec Holdings Australia Pty Limited | Holding company | Australia | 100% | | 100% | | | Investec Capitalmind Investment Limited | Non trading | England and Wales | 100% | | 100% | | | Indirect subsidiary undertakings of Investec Bank plc | | | | | | | | Investec Europe Limited | MiFiD firm | Ireland | 100% | | 100% | | | Investec Securities (US) LLC | Financial services | USA | 100% | | 100% | | | Investec Continental Europe Advisory BV | Non trading | Netherlands | 60% | | 60% | | | Investec Advisory SAS | Advisory services | France | 60% | | 60% | | | Investec Advisory GmbH & Co. KG | Advisory services | Germany | 60% | | 60% | | | Investec Advisory B.V | Advisory services | Netherlands | 60% | | 60% | | All of the above subsidiary undertakings are included in the consolidated accounts. The subsidiaries listed above are only in relation to subsidiary undertakings whose results or financial position, in the opinion of the directors, have a significant impact on the financial statements. For more details on interests in associated undertakings and joint venture holdings refer to note 28 . A complete list of subsidiary, associated undertakings and joint venture holdings as required by the Companies Act 2006 is included in note 58 on pages [244](#i447e4d363cd344738300acdd42f0e3a0_481) to [247](#iab60f1283f8349ae99ce1516e9e33c88_297) . Consolidated structured entities Investec Bank plc has no equity interest in the following structured entities, which are consolidated. Typically a structured entity is an entity in which voting or similar rights are not the dominant factor in deciding control. The judgements to assess whether the Group has control over these structures include assessing the purpose and design of the entity and considering whether the Group or another involved party with power over the relevant activities is acting as a principal in its own right or as an agent on behalf of others. | | | | | --- | --- | --- | | | | | | Name of principal structured entity | | Type of structured entity | | Cavern Funding 2020 plc | | Securitised auto receivables | | Landmark Mortgage Securities No. 2 plc^ | | Securitised residential mortgages | | Temese Funding 2 plc | | Securitised receivables | | Gresham Leasing One Limited | | Aircraft related | | KF Turbo Leasing Limited | | Dormant company | | Zebra Aviation Limited | | Aircraft leasing | | Zebra Capital II Limited | | Structured note issuance related | ^During the year, the Group sold a residual tranche holding in Landmark Mortgage Securities No. 2 plc structured entity which subsequently resulted in the deconsolidation of the SPV and its related assets and liabilities. For additional detail on the other securitised assets and liabilities arising on securitisation, refer to note 27 . Details of the risks to which the Group is exposed through all of its securitisations are included in the notes to risk and capital management on page [273](#i447e4d363cd344738300acdd42f0e3a0_511). 235 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 51. #### Principal subsidiaries and associated companies and joint venture holdings – #### Investec Bank plc #### (continued) The key assumptions for the main types of structured entities which the Group consolidates are summarised below: Securitised residential mortgages The Group has securitised residential mortgages in order to provide investors with exposure to residential mortgage risk and to raise funding. These structured entities are consolidated due to the Group’s holdings of equity notes combined with its control over servicing activities. The Group is not required to fund any losses above those incurred on the notes it has retained; such losses are reflected in any impairment of securitised mortgages as those assets have not been derecognised. Structured debt and loan portfolios The Group has structured debt and loan portfolios for the purpose of issuing asset-backed securities. These structured entities are consolidated due to the Group’s retention of equity notes and because it continues to act as the collateral manager. The Group is not required to fund any losses above those incurred on the notes it has retained. Securitised receivables The Group has securitised a portfolio of medium-term lease and hire purchase receivables. These structured entities are consolidated as the Group has retained the equity notes and control over servicing activities. The Group is not required to fund any losses above those incurred on the notes it has retained. Other structured entities – commercial operations The Group also consolidates a number of structured entities where control arises from rights attached to lending facilities and similar commercial involvement. These arise primarily in the areas of aircraft funds where the Group has rights which allow it to maximise the value of the assets held and investments in mining projects due to its exposure to equity-like returns and ability to influence the strategic and financial decision-making. The Group is not required to fund any losses above those which could be incurred on debt positions held or swaps which exist with these structured entities. The risks to which the Group is exposed from these structured entities are related to the underlying assets held in the structures. Significant restrictions As is typical for a large group of companies, there are restrictions on the ability of the Group to obtain distributions of capital, access the assets or repay the liabilities of members of the Group due to the statutory, regulatory and contractual requirements of its subsidiaries. These are considered below: Regulatory requirements Subsidiary companies are subject to prudential regulation and regulatory capital requirements in the countries in which they are regulated. These require entities to maintain minimum capital, leverage and exposure ratios restricting the ability of these entities to make distributions of cash or other assets to the Parent company. Regulated subsidiaries of the Group are required to maintain liquidity pools to meet PRA and local regulatory requirements. The main subsidiaries affected are: Investec Bank (Channel Islands) Limited and Investec Bank (Switzerland) AG which must maintain compliance with the regulatory minimum. Capital management within the Group is discussed in the notes to risk and capital management on pages [287](#i447e4d363cd344738300acdd42f0e3a0_526) to [289](#i7c92788fb1474a82a8a57477341a81fa_42600). Statutory requirements The Group’s subsidiaries are subject to statutory requirements not to make distributions of capital and unrealised profits, and generally maintain solvency. These requirements restrict the ability of subsidiaries to remit dividends, except in the case of a legal capital reduction or liquidation. Contractual requirements Asset encumbrance – the Group uses its financial assets to raise finance in the form of securitisations and through the liquidity schemes of central banks. Once encumbered, the assets are not available for transfer around the Group. The assets typically affected are disclosed in notes 19 and 54. 236 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 51. #### Principal subsidiaries and associated companies and joint venture holdings – #### Investec Bank plc #### (continued) Structured associates The Group has investments in a number of structured funds specialising in aircraft financing where the Group acts as adviser or fund manager in addition to holding units within the fund. As a consequence of these roles and funding, the Group has significant influence over the fund and therefore the funds are treated as associates. The Group applies the venture capital exemption to these holdings and, as such, the investments in the funds are accounted for at fair value and held within the investment portfolio on the balance sheet. | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | Type of structured entity | | | Nature and purpose | | | Interest held by the Group/income earned | | | | | | | | | | Aircraft investment funds | | | To generate fees from managing assets on behalf of third party investors | | | Investments in units issued by the fund | | | | | These vehicles are financed through the issue of units to investors | | | Management fees | The table below sets out an analysis of the carrying amounts of interests held by the Group in structured associate entities. | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | 31 March 2025 | Line on the balance sheet | Carrying value £'000 | Maximum exposure to loss | Income earned from structured entity | £’000 | | | £’000 | | | Aircraft investment funds | Investment portfolio | 22 082 | Limited to the carrying value | Investment income | 2 180 | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | 31 March 2024 | Line on the balance sheet | Carrying value £'000 | Maximum exposure to loss | Income earned from structured entity | £’000 | | | £’000 | | | Aircraft investment funds | Investment portfolio | 22 108 | Limited to the carrying value | Investment income | 226 | | 237 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 52. #### Unconsolidated structured entities The Group enters into transactions with unconsolidated structured entities in the normal course of business to facilitate customer transactions and for specific investment opportunities. Unconsolidated structured entities are those which the Group does not control in line with basis of consolidation as set out in the accounting policies on pages [128](#i447e4d363cd344738300acdd42f0e3a0_280) to [142](#i7e3e178259884a948abc3d325fbe8a20_42814) . The table below describes the types of unconsolidated structured entities the Group has transactions with. | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | Type of structured entity | | | Nature and purpose | | | Interest held by the Group/income earned | | | | | | | | | | Investment funds | | | To generate fees from managing assets on behalf of third party investors | | | Investments in units issued by the fund | | | | | | | | | | | | | | | | | | | | | These vehicles are financed through the issue of units to investors | | | Management fees | | | | | | | | | | | | | | | | | | Debt funds | | | To generate a return for investors by providing exposure to residential mortgage risk | | | Investments in units issued by the fund | | | | | | | | | | | | | | | | | | | | | These vehicles are financed through the issue of notes to investors | | | Interest income/Investment income/ Management fees | | | | | | | | | | | | | | | | | | Aircraft leasing structures | | | To generate fees from managing assets on behalf of third party investors | | | Investments in units issued by the fund | | | | | | | | | | | | | | | | | | | | | These vehicles are financed through the issue of units to investors | | | Interest income/Investment income | | | | | | | | | The table below shows the Group's maximum exposure to the unconsolidated structured entities. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | At 31 March 2025 | Investment fund | Debt fund | Aircraft leasing structure | Total | | £’000 | | Derivatives assets (fair value through profit and loss) | — | — | 92 | 92 | | Loans and advances (fair value through profit and loss) | — | — | 11 011 | 11 011 | | Investment portfolio (fair value through profit and loss) | 24 639 | 4 250 | 1 091 | 29 980 | | Other debt securities (fair value through profit and loss) | — | 26 819 | — | 26 819 | | Total assets | 24 639 | 31 069 | 12 194 | 67 902 | | Other liabilities (fair value through profit and loss) | — | — | — | — | | Total liabilities | — | — | — | — | | Off-balance sheet commitments | — | 40 254 | 2 556 | 42 810 | | Maximum exposure at 31 March 2025 | 24 639 | 71 323 | 14 750 | 110 712 | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | At 31 March 2024 | Investment fund | Debt fund | Aircraft leasing structure | Total | | £’000 | | Loans and advances (fair value through profit and loss) | — | — | 11 477 | 11 477 | | Investment portfolio (fair value through profit and loss) | 24 337 | 6 395 | 1 114 | 31 846 | | Other debt securities (fair value through profit and loss) | — | 32 252 | — | 32 252 | | Total assets | 24 337 | 38 647 | 12 591 | 75 575 | | Other liabilities (fair value through profit and loss) | 0 | 12 | — | 12 | | Total liabilities | — | 12 | — | 12 | | Off-balance sheet commitments | — | 13 485 | 2 610 | 16 096 | | Maximum exposure at 31 March 2024 | 24 337 | 52 120 | 15 201 | 91 659 | ^The prior year disclosure for balances in a Debt fund has been corrected to present the values under 'Debt fund', rather than 'Investment fund'. 238 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 52. #### Unconsolidated structured entities #### (continued) Financial support provided to the unconsolidated structured entities There are no contractual agreements which require the Group to provide any additional financial or non-financial support to these structured entities. During the year, the Group has not provided any such support and does not have any current intentions to do so in the future. Sponsoring The Group considers itself a sponsor of a structured entity when it facilitates the establishment of the structured entity. Interests in structured entities which the Group has not set up Purchased securitisation positions The Group buys and sells interests in structured entities that it has not originated as part of its trading activities, for example, residential mortgage securities, commercial mortgage securities, loans to corporates and resecuritisations. In such cases the Group typically has no other involvement with the structured entity other than the securities it holds as part of its trading activities, and its maximum exposure to loss is restricted to the carrying value of the asset. Details of the value of these interests is included in the notes to risk and capital management on page [273](#i447e4d363cd344738300acdd42f0e3a0_511). 239 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 53. #### Offsetting | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Amounts subject to enforceable netting arrangements | | | | | | | | | | | | Effects of offsetting on-balance sheet | | | | | Related amounts not offset\* | | | | | | At 31 March | Gross amounts | Amounts offset | | Net financial assets/ liabilities reported on the balance sheet | | Financial instruments (including non- cash collateral) | Cash collateral | | Net amount | | | £’000 | | | | | | Group | | | | | | | | | | | | 2025 | | | | | | | | | | | | Assets | | | | | | | | | | | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 640 765 | — | | 1 640 765 | | (1 606 223) | (34 542) | | — | | | Derivative financial instruments | 945 634 | (619 748) | | 325 886 | | (116 383) | (113 709) | | 95 794 | | | Other assets | 270 115 | 111 432 | | 381 547 | | — | — | | 381 547 | | | Liabilities | | | | | | | | | | | | Derivative financial instruments | 783 107 | (508 316) | | 274 791 | | (116 383) | (37 815) | | 120 593 | | | Repurchase agreements and cash collateral on securities lent | 178 202 | — | | 178 202 | | (176 831) | (522) | | 849 | | \*The Group enters into derivatives and repurchase and reverse repurchase agreements with various counterparties which are governed by industry standard master netting agreements. The Group holds and provides cash and securities collateral in respect of derivatives transactions covered by these agreements. The right to set off balances under these master netting agreements or to set off cash and securities collateral only arises in the event of non-payment or default and, as a result, these arrangements do not qualify for offsetting under IAS 32. | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Amounts subject to enforceable netting arrangements | | | | | | | | | | | | Effects of offsetting on-balance sheet | | | | | Related amounts not offset\* | | | | | | At 31 March | Gross amounts | Amounts offset 1 | | Net financial assets/ liabilities reported on the balance sheet ^# | | Financial instruments (including non- cash collateral) 2 | Cash collateral † | | Net amount | | | £’000 | | | | | | Group | | | | | | | | | | | | 2024\*\* | | | | | | | | | | | | Assets | | | | | | | | | | | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 140 115 | — | | 1 140 115 | | (1 097 905) | (31 029) | | 11 181 | | | Derivative financial instruments | 1 552 093 | (1 119 698) | | 432 395 | | (124 113) | (127 045) | | 181 237 | | | Other assets | 265 597 | 189 849 | | 455 446 | | — | — | | 455 446 | | | Liabilities | | | | | | | | | | | | Derivative financial instruments | 1 339 104 | (929 849) | | 409 255 | | (124 113) | (10 745) | | 274 397 | | | Repurchase agreements and cash collateral on securities lent | 85 091 | — | | 85 091 | | (85 091) | — | | — | | | Debt securities in issue | 956 887 | — | | 956 887 | | (9 823) | — | | 947 064 | | \*The Group enters into derivatives and repurchase and reverse repurchase agreements with various counterparties which are governed by industry standard master netting agreements. The Group holds and provides cash and securities collateral in respect of derivatives transactions covered by these agreements. The right to set off balances under these master netting agreements or to set off cash and securities collateral only arises in the event of non-payment or default and, as a result, these arrangements do not qualify for offsetting under IAS 32. ^Restated as detailed in note 57. #The prior year has been represented to only include financial assets and liabilities. †Where sovereign debt securities have been purchased at the same time as total return swaps (TRS) with the same counterparty, such that the combined position has the economic substance similar to secured lending, that sovereign debt security and the TRS are classified On balance sheet as ‘reverse repurchase agreements and cash collateral on securities borrowed’. To be consistent with the Balance Sheet presentation, cash collateral placed on the TRS derivative is offset on the ‘reverse repurchase agreements and cash collateral on securities borrowed’ line in the offsetting note. In the prior year cash collateral placed on the TRS derivative was offset on the derivatives line. The prior year Offsetting note is restated to be consistent with the current year. 1Amounts offset for derivative financial assets and derivative financial liabilities represents variation margin received and paid on exchange traded/centrally cleared derivatives and the netting of long and short derivative balances against clients with enforceable netting arrangements. 2Financial instruments (including non-cash collateral) include financial collateral whether recognised or unrecognised. The prior year has been restated to be consistent with the current year. \*\* This note has been restated to limit disclosures to recognised line items subject to enforceable netting arrangements and to include off-balance sheet collateral. 240 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 53. #### Offsetting #### (continued) | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Amounts subject to enforceable netting arrangements | | | | | | | | | | | | Effects of offsetting on-balance sheet | | | | | Related amounts not offset\* | | | | | | At 31 March | Gross amounts | Amounts offset | | Net financial assets/ liabilities reported on the balance sheet | | Financial instruments (including non- cash collateral) | Cash collateral | | Net amount | | | £’000 | | | | | | Company | | | | | | | | | | | | 2025 | | | | | | | | | | | | Assets | | | | | | | | | | | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 640 765 | — | | 1 640 765 | | (1 606 223) | (34 542) | | — | | | Derivative financial instruments | 931 603 | (619 749) | | 311 854 | | (113 180) | (98 417) | | 100 257 | | | Other assets | 248 834 | 111 432 | | 360 266 | | — | — | | 360 266 | | | Liabilities | | | | | | | | | | | | Derivative financial instruments | 776 226 | (508 317) | | 267 909 | | (113 180) | (36 742) | | 117 987 | | | Repurchase agreements and cash collateral on securities lent | 328 534 | — | | 328 534 | | (327 162) | (522) | | 850 | | \*The Group enters into derivatives and repurchase and reverse repurchase agreements with various counterparties which are governed by industry standard master netting agreements. The Group holds and provides cash and securities collateral in respect of derivatives transactions covered by these agreements. The right to set off balances under these master netting agreements or to set off cash and securities collateral only arises in the event of non-payment or default and, as a result, these arrangements do not qualify for offsetting under IAS 32. | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Amounts subject to enforceable netting arrangements | | | | | | | | | | | | Effects of offsetting on-balance sheet | | | | | Related amounts not offset\* | | | | | | At 31 March | Gross amounts | Amounts offset † | | Net financial assets/ liabilities reported on the balance sheet # | | Financial instruments (including non- cash collateral) 1 | Cash collateral ^ | | Net amount | | | £’000 | | | | | | Company | | | | | | | | | | | | 2024\*\* | | | | | | | | | | | | Assets | | | | | | | | | | | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 140 115 | — | | 1 140 115 | | (1 097 905) | (31 029) | | 11 181 | | | Derivative financial instruments | 1 540 928 | (1 119 698) | | 421 230 | | (122 506) | (127 045) | | 171 679 | | | Other assets | 233 032 | 189 849 | | 422 881 | | — | — | | 422 881 | | | Liabilities | | | | | | | | | | | | Derivative financial instruments | 1 359 524 | (929 849) | | 429 675 | | (122 506) | (9 324) | | 297 845 | | | Repurchase agreements and cash collateral on securities lent | 235 447 | — | | 235 447 | | (235 173) | — | | 274 | | | Debt securities in issue | 955 694 | — | | 955 694 | | (9 823) | — | | 945 871 | | \*The Group enters into derivatives and repurchase and reverse repurchase agreements with various counterparties which are governed by industry standard master netting agreements. The Group holds and provides cash and securities collateral in respect of derivatives transactions covered by these agreements. The right to set off balances under these master netting agreements or to set off cash and securities collateral only arises in the event of non-payment or default and, as a result, these arrangements do not qualify for offsetting under IAS 32. #The prior year has been represented to only include financial assets and liabilities. ^Where sovereign debt securities have been purchased at the same time as total return swaps (TRS) with the same counterparty, such that the combined position has the economic substance similar to secured lending, that sovereign debt security and the TRS are classified On balance sheet as ‘reverse repurchase agreements and cash collateral on securities borrowed’. To be consistent with the Balance Sheet presentation, cash collateral placed on the TRS derivative is offset on the ‘reverse repurchase agreements and cash collateral on securities borrowed’ line in the offsetting note. In the prior year cash collateral placed on the TRS derivative was offset on the derivatives line. The prior year Offsetting note is restated to be consistent with the current year. †Amounts offset for derivative financial assets and derivative financial liabilities represents variation margin received and paid on exchange traded/centrally cleared derivatives and the netting of long and short derivative balances against clients with enforceable netting arrangements. 1Financial instruments (including non-cash collateral) include financial collateral whether recognised or unrecognised. The prior year has been restated to be consistent with the current year. \*\* This note has been restated to limit disclosures to recognised line items subject to enforceable netting arrangements and to include off-balance sheet collateral. 241 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 54. #### Derecognition Group Transfer of financial assets that do not result in derecognition The Group is party to securitisation transactions whereby assets continue to be recognised on-balance sheet (either fully or partially) although they have been subject to legal transfer to another entity. Securitisations may, depending on the individual arrangement, result in continued recognition of the securitised assets and the recognition of the debt securities issued in the transaction. | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | 2025 | | | 2024 | | | | No derecognition achieved | Carrying amount of assets that continue to be recognised | Carrying amount of associated liabilities | | Carrying amount of assets that continue to be recognised | Carrying amount of associated liabilities | | | £’000 | | | | Loans and advances to customers | 1 657 927 | — | | 1 511 765 | — | | | Loans and advances to banks | 95 626 | — | | 69 389 | — | | | | 1 753 553 | — | | 1 581 154 | — | | The transferred assets above in both the current and prior year are held within structured entities which are wholly-owned and consolidated by the Group. There are no external parties participating in these vehicles and therefore the Group continues to have full exposure to the risks and rewards associated with the assets and the associated liabilities are eliminated on consolidation. There are no restrictions or limitations on the Group's recourse to the assets held within the structured entities. For transfer of assets in relation to repurchase agreements see note 19. Company The Company has not been party to transactions that resulted in a transfer of financial assets that did not result in derecognition. 55. #### Investment in subsidiary companies | | | | | | | --- | --- | --- | --- | --- | | | | | | | | At 31 March | 2025 | | 2024 | | | £’000 | | | | Cost | | | | | | At the beginning of the year | 619 735 | | 1 013 191 | | | Acquisition of subsidiaries | 7 100 | | 49 630 | | | Transfer from investment portfolio | 14 115 | | — | | | Disposal of subsidiaries | (446) | | — | | | Deconsolidation of subsidiaries | — | | (433 162) | | | Return of capital by subsidiary | — | | (9 924) | | | At the end of the year | 640 504 | | 619 735 | | | Provision for impairment in value | | | | | | At the beginning of the year | (167 868) | | (140 362) | | | Impairment of subsidiaries | (11 000) | | (27 506) | | | At the end of the year | (178 868) | | (167 868) | | | Carrying value at the end of the year | 461 636 | | 451 867 | | All subsidiary undertakings are unlisted. The main increase relates to a capital injection of £7.1 million into Investec Investments (UK) Limited to facilitate the acquisition of a new trading property. In addition to this, there was a transfer of £14.1 million for an entity holding a trading property that was previously held as a fair value investment and is now under our control. An impairment of £11 million relating to a property company. This decision was based on the independent valuers' assessment of the property's value. During the prior year, acquisition of subsidiaries includes the £43.7 million stepped acquisition of Investec Continental Europe Advisory, which was previously an associate. There was also £4.7 million of capital injections into two subsidiaries and two new subsidiaries were acquired for £1.2 million to seize new business opportunities. The deconsolidation of subsidiaries relates to Investec Wealth & Investment Limited, following the all-share combination with Rathbones Group. £9.9 million capital return is in respect of the US subsidiary which remains well capitalised. Impairment of £27.5 million is in relation to an impairment of a holding company, £15.1 million and a property company, £12.4 million. The impairment of the property company reflects independent valuers assessment of the property. 242 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 56. #### Events after the reporting date There have been no significant events subsequent to the reporting date that would require adjustment to or disclosure in the financial statements. In the ordinary course of business, events may occur that influence the credit quality of loans and advances. At the date of this report, we have concluded that no changes are required to our ECL provisions or there is insufficient new information available since 31 March 2025 of any conditions which existed at the balance sheet date to reliably estimate any adjustments to these ECL provisions. 57. #### Restatements #### Balance sheet restatements Derecognition of derivative assets and liabilities Post the review of the accounting treatment of an aviation lease structure, it was identified that at 31 March 2024 derivative financial instruments assets of £42.4 million (31 March 2023: £39.7 million) and derivative financial instruments liabilities of £63.4 million (31 March 2023: £58.9 million) were incorrectly bifurcated from leases in the past. These have now been derecognised in the comparative balances and included in the measurement of associated lease contracts, leading to a reduction in the net investment in a finance sublease of £14.1 million (31 March 2023: £13.0 million), reflecting historic impairments, and an increase in other liabilities of £6.8 million (31 March 2023: £6.3 million). This change has no material impact on the income statement or statement of changes in equity. The movements in operating assets and liabilities within the cash flow statement were affected due to these restatements, with a net nil impact on operating cash flows. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | | At 31 March 2024 | | At 31 March 2024 | | £’000 | | as previously reported | Adjustment | restated | | Group | | | | | | Derivative financial instruments | | 474 834 | (42 439) | 432 395 | | Other assets | | 764 473 | (14 126) | 750 347 | | Total assets | | 1 239 307 | (56 565) | 1 182 742 | | Derivative financial instruments | | 472 662 | (63 407) | 409 255 | | Other liabilities | | 980 595 | 6 842 | 987 437 | | Total liabilities | | 1 453 257 | (56 565) | 1 396 692 | | | | | | | --- | --- | --- | --- | | | | | | | | At 31 March 2023 | | At 1 April 2023 | | £’000 | as previously reported | Adjustment | restated | | Group | | | | | Derivative financial instruments | 680 262 | (39 658) | 640 604 | | Other assets | 993 385 | (12 997) | 980 388 | | Total assets | 1 673 647 | (52 655) | 1 620 992 | | Derivative financial instruments | 704 816 | (58 950) | 645 866 | | Other liabilities | 1 198 267 | 6 295 | 1 204 562 | | Total liabilities | 1 903 083 | (52 655) | 1 850 428 | 243 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 57. #### Restatements #### (continued) #### Income statement restatements Re-presentation of strategic actions and associates In prior periods, Investec’s equity accounted income was split between operating profit and loss and non-operating items such as amortisation of intangibles and profit and loss impacts from strategic actions on the face of the income statement. We have amended the presentation whereby Investec’s total share of earnings of associates and joint ventures is now presented as a single line on the face of the income statement. As a consequence, some of the subtotals previously presented are no longer appropriate and have been removed. These changes had no impact on earnings per share or cash flow statement. | | | | | | --- | --- | --- | --- | | | | | | | £’000 | Year to 31 March 2024 as previously reported | Re-presentation of strategic actions and associates | Year to 31 March 2024 restated | | Interest income | 1 933 984 | — | 1 933 984 | | Interest expense | (1 105 027) | — | (1 105 027) | | Net interest income | 828 957 | — | 828 957 | | Fee and commission income | 178 770 | — | 178 770 | | Fee and commission expense | (16 381) | — | (16 381) | | Investment income | 2 625 | — | 2 625 | | Share of post taxation profit of associates and joint venture holdings | 31 287 | (22 255) | 9 032 | | Profit before amortisation and integration costs | 31 287 | — | 31 287 | | Amortisation of acquired intangibles | — | (12 624) | (12 624) | | Acquisition related and integration costs of associate | — | (9 631) | (9 631) | | Trading income/(loss) arising from | | | — | | – customer flow | 103 158 | — | 103 158 | | – balance sheet management and other trading activities | 27 119 | — | 27 119 | | Other operating income | 2 915 | — | 2 915 | | Operating income | 1 158 450 | (22 255) | 1 136 195 | | Expected credit loss impairment charges | (85 997) | — | (85 997) | | Operating income after expected credit loss impairment charges | 1 072 453 | (22 255) | 1 050 198 | | Operating costs | (626 732) | — | (626 732) | | Amortisation of acquired intangibles | (940) | — | (940) | | Amortisation of acquired intangibles of associate | (5 679) | 5 679 | — | | Closure and rundown of the Hong Kong direct investments business | (784) | — | (784) | | Financial impact of strategic actions | (16 576) | 16 576 | — | | Profit before taxation | 421 742 | — | 421 742 | | Taxation on operating profit before acquired intangibles and strategic actions | (96 956) | — | (96 956) | | Taxation on acquired intangibles and strategic actions | 427 | — | 427 | | Profit after taxation from continuing operations | 325 213 | — | 325 213 | | Profit after taxation from discontinued operations | 395 600 | — | 395 600 | | Profit after taxation | 720 813 | — | 720 813 | | Profit attributable to other non-controlling interests | (1 204) | — | (1 204) | | Earnings attributable to shareholder | 719 609 | — | 719 609 | 244 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 58. #### Subsidiaries | | | | | | | --- | --- | --- | --- | --- | | | | | | | | At 31 March 2025 | Principal activity | | Interest held | | | United Kingdom Registered office: 30 Gresham Street, London, EC2V 7QP, UK | | | | | | PIF Investments Limited\* | Investment holding company | | 100% | | | EVO Nominees Limited\* | Dormant | | 100% | | | Investec Finance Limited\* | Dormant | | 100% | | | Investec Group Investments (UK) Limited\* | Investment holding company | | 100% | | | GFT Holdings Limited | Dormant | | 100% | | | Investec Investment Trust plc | Debt issuer | | 100% | | | Investec Investments (UK) Limited\* | Investment holding company | | 100% | | | Inv-German Retail Limited | Property company | | 100% | | | Investec Securities Limited | Dormant | | 100% | | | Technology Nominees Limited\* | Nominee | | 100% | | | Torteval LM Limited\* | Investment holding company | | 100% | | | Torteval Funding LLP\* | Financing company | | 100% | | | Evolution Capital Investment Limited | Dormant | | 100% | | | Investec Capital Solutions Limited\* | Lending company | | 100% | | | Diagonal Nominees Limited\* | Nominee | | 100% | | | Kendals Regeneration Limited\* (formerly Nars Holdings Limited) | Property company | | 100% | | | Investec India Holdco Limited | Investment holding company | | 86.53% | | | Investec Alternative Investment Management Limited\* | Fund management activities | | 100% | | | Investec Capitalmind Investment Limited\* | Non-trading | | 100% | | | NI (HH) LLP\* | Property company | | 93% | | | HH Farringdon Limited | Nominee | | 100% | | | Registered office: Reading International Business Park, Reading, RG2 6AA, UK | | | | | | Mann Island Finance Limited | Leasing company | | 100% | | | CF Corporate Finance Limited\* | Leasing company | | 100% | | | MI Vehicle Finance Limited | Leasing company | | 100% | | | Quantum Funding Limited\* | Leasing company | | 100% | | | Investec Asset Finance plc\* | Leasing company | | 100% | | | Australia Registered office: Boardroom Pty Limited, Level 12, 225 George Street, Sydney NSW 2000, Australia | | | | | | Investec Holdings Australia Pty Limited\* | Holding company | | 100% | | | Investec Australia Finance Pty Limited | Lending company | | 100% | | | Investec Australia Pty Limited | Financial services | | 100% | | | British Virgin Islands Registered office: Palm Grove House, PO Box 438, Road Town, Tortola, British Virgin Islands | | | | | | Finistere Directors Limited | Corporate director | | 100% | | | GFT Directors Limited | Corporate director | | 100% | | | France Registered office: 27 Rue Maurice Flandin – 69003 Lyon Cedex 03, France | | | | | | SCI CAP Philippe\* | Property company | | 99% | | \*Directly owned by Investec Bank plc. 245 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 58 . #### Subsidiaries #### (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | | | At 31 March 2025 | Principal activity | | Interest held | | | France Registered office: 32 rue de Monceau, 75008 Paris, France | | | | | | Investec Advisory SAS | Advisory services | | 60% | | | Registered office: 92, avenue de Wagram, 75017, Paris | | | | | | Villa Lara Eze SAS | Property company | | 100% | | | Germany Registered office: Sonnenberger Strabe 16, 65193 Weisbaden, Germany | | | | | | Investec Advisory GmbH & Co. KG | Advisory services | | 60% | | | Guernsey Registered office: PO Box 188, Glategny Court, Glategny Esplanade, St Peter Port, Guernsey, GY1 3LP, Channel Islands | | | | | | Investec Asset Finance (Channel Islands) Limited | Leasing company | | 100% | | | Registered office: Glategny Court, Glategny, Esplanade, St Peter Port, Guernsey, GY1 1WR, Channel Islands | | | | | | Investec Bank (Channel Islands) Limited\* | Banking institution | | 100% | | | Investec Bank (Channel Islands) Nominees Limited | Nominee | | 100% | | | Registered office: Glategny Court, Glategny Esplanade, St Peter Port, Guernsey, GY1 3RP, Channel Islands | | | | | | Bayeux Limited | Corporate director | | 100% | | | Finistere Limited | Corporate nominee | | 100% | | | Finistere Secretaries Limited | Corporate secretary | | 100% | | | ITG Limited | Corporate director | | 100% | | | Jersey Registered office: 2nd Floor One The Esplanade, St Helier, Channel Islands, Jersey, JE2 3QA | | | | | | Appleton Resources (Jersey) Limited\* | Holding company | | 100% | | | Registered office: Aztec Group House, IFC6, The Esplanade, St. Helier, JE4 0QH, Jersey | | | | | | REALIS GP Limited | Fund management activities | | 100% | | | India Registered office: B Wing, 11th Floor, Parinee Crescenzo, Bandra Kurla Complex, Bandra East, Mumbai – 400 051, India | | | | | | Investec Credit Finance Private Limited | Lending platform | | 99% | | | Registered office: 13th floor, Tower 3, NESCO IT Park, NH 8, NESCO, Goregaon, Mumbai, Maharashtra 400063 | | | | | | Investec Global Services (India) Private Limited\* | ITES outsourcing | | 100% | | \*Directly owned by Investec Bank plc. 246 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 58 . #### Subsidiaries #### (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | | | At 31 March 2025 | Principal activity | | Interest held | | | Ireland Registered office: The Harcourt Building, Harcourt Street, Dublin 2, Ireland | | | | | | Investec Holdings (Ireland) Limited\* | Holding company | | 100% | | | Investec Ireland Limited | Group services company | | 100% | | | Investec International Limited | Aircraft leasing services | | 100% | | | Investec Private Finance Ireland Limited\* | Loan credit servicing | | 100% | | | Investec Ventures Ireland Limited | Investment management services | | 100% | | | Venture Fund Private Principals Limited | Investment services | | 100% | | | Investec Europe Limited | MiFiD firm | | 100% | | | Registered office: 32 Molesworth Street, Dublin 2, Ireland | | | | | | Gresham Leasing 2 Limited\* | Equipment rental and leasing | | 100% | | | Luxembourg Registered office: 15 Boulevard Friedrich Wilhelm Raiffeisen L-2411, Luxembourg | | | | | | PDF II GP s.a.r.l. | Fund management activities | | 100% | | | Netherlands Registered office: Reitschweg 49, 5232BX's-Hertogenbosch, the Netherlands | | | | | | Investec Continental Europe Advisory BV | Non-trading | | 60% | | | Investec Advisory B.V | Advisory services | | 60% | | | Singapore Registered office: 8 Wilkie Road, #03-01 Wilkie Edge, Singapore 228095 | | | | | | Investec Singapore Pte Limited | Securities services | | 100% | | | Switzerland Registered offices: Löwenstrasse 29, CH-8001 Zurich, Switzerland | | | | | | Investec Bank (Switzerland) AG\* | Banking institution and wealth manager | | 100% | | | | | | | | | United States of America Registered office: 10 E. 53rd St., 22nd Floor, New York, NY 10022, USA | | | | | | US Multifamily GP LLC | Investment holding company | | 100% | | | Investec USA Holdings Corp\* | Holding company | | 100% | | | Investec Inc | Investment holding company | | 100% | | | Fuel Cell IP 1 LLC Investment | Investment holding company | | 100% | | | Fuel Cell IP 2 LLC Investment | Investment holding company | | 100% | | | Investec Securities (US) LLC | Financial services | | 100% | | | Registered office: One Carbon Center-Suite 501, 13905 McCorkle Ave. SE, Chesapeake, WV 25315 | | | | | | Appleton Coal LLC | Investment holding company | | 100% | | \*Directly owned by Investec Bank plc. 247 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO THE FINANCIAL STATEMENTS CONTINUED | | | | | | 58. #### Subsidiaries #### (continued) A ssociates and joint venture holding s | | | | | | | --- | --- | --- | --- | --- | | | | | | | | At 31 March 2025 | Principal activity | | Interest held | | | United Kingdom Registered office: 30 Gresham Street, London, England, EC2V 7QN | | | | | | Rathbones Group Plc | Financial services | | 41% | | | Registered office: Capital House, Raynham Road, Bishops Stortford, Hertfordshire, CM23 5TT | | | | | | CF Capital Holdings | Holding company | | 25% | | | Registered office: 1 Park Row, Leeds, England, LS1 5AB | | | | | | Macdui Topco Limited | Holding company | | 40% | | | British Virgin Islands Registered office: Vistra Corporate Service Centre, Wickhams Cay II, Road Town, Tortola VG1110, British Virgin Islands | | | | | | iMarkets (Holdings) Limited | Online trading platform | | 33% | | | Registered office: Wattley Building, 2nd Floor, 160 Main Street, PO Box 3410, Road Town, Tortola, British Virgin Islands | | | | | | Templewater Holdings Limited | Holding company | | 50% | | | India Registered office: 32/1. 14th Cross, 9th Main, 6th Sector H.S.R. Layout, Bangalore, Karnataka 560102, India | | | | | | JSM Advisers Private Limited | Fund management | | 55% | | | Registered office: B Wing, 11th floor, Parinee Crescenzo, Bandra Kurla Complex, Bandra East, Mumbai – 400051 | | | | | | Investec Capital Services (India) Private Limited | Merchant banking & stock broking | | 80.3% | | 248 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT | | | | | | 59. #### Credit and counterparty risk Credit and counterparty risk arises primarily from three types of transactions: • Lending transactions, through loans and advances to clients and counterparties, creating the risk that an obligor will be unable or unwilling to repay capital and/or interest on loans and advances granted to them. This category includes bank placements where we have placed funds with other financial institutions • Financial instrument transactions, producing issuer risk where payments due from the issuer of a financial instrument may not be received • Trading transactions, giving rise to settlement and replacement risk (collectively counterparty risk): – Settlement risk is the risk that the settlement of a transaction does not take place as expected, with one party making required settlements as they fall due but not receiving the performance to which they are entitled – Replacement risk is the risk following default by the original counterparty resulting in the contract holder having to enter into a replacement contract with a second counterparty in order to fulfil the transaction . The relevant credit committees will also consider wrong-way risk at the time of granting credit limits to each counterparty. In the banking book environment, wrong-way risk occurs where the value of collateral to secure a transaction decreases as the probability of default of the borrower or counterparty increases. For counterparty credit risk resulting from transactions in traded products (such as OTC derivatives), wrong-way risk is defined as exposure to a counterparty that is adversely correlated with the credit quality of that counterparty. It arises when default risk and credit exposure increase together. Credit and counterparty risk may also arise in other ways and it is the role of the risk management functions and the various independent credit committees to identify risks falling outside these definitions. | | | --- | | | | Risk governance structure | To manage, measure, monitor and mitigate credit and counterparty risk, independent credit committees exist in the UK. These committees also have oversight of regions where we assume credit and counterparty risk and operate under Board-approved delegated limits, policies and procedures. There is a high level of executive involvement and oversight in the credit decision-making forums depending on the size and complexity of the deal. It is our policy that all credit committees include voting members who are independent of the originating business unit. All decisions to enter into a transaction are based on unanimous consent. In addition to the credit committees, the following processes assist in managing, measuring and monitoring credit and counterparty risk: • Day-to-day arrears management and regular arrears reporting ensure that individual positions and any potential adverse trends are dealt with in a timely manner • Watchlist Forum s review the management of distressed loans, potential problem loans and exposures in arrears that require additional attention and supervision. These committees review ECL impairments and staging at an asset level as well as potential fair value adjustments to loans and advances to customers. They provide recommendations for the appropriate staging and level of ECL impairment where required • The Forbearance Forum reviews and monitors counterparties who have been granted forbearance measures • The Impairment Decision Committee reviews recommendations from underlying Watchlist Forums and considers and approves the appropriate level of ECL impairments and staging • The Models Forum provides an internal screening and validation process for credit models. We have established independent model validation teams who review the models and provide feedback on the accuracy and operation of the models and note items for further development through the forum • An annual review of risk appetite framework and limits that are approved by IBP ERC, IBP BRCC and IBP Board. | | | | --- | --- | | | | | Unaudited_information.svg | Risk appetite | The IBP Board has set risk appetite limits which regulate the maximum exposures we would be comfortable to tolerate in order to diversify and mitigate risk. Should there be any breaches to limits, or where exposures are nearing limits, these exceptions are specifically highlighted for attention, with remedial actions reported to IBP BRCC and the IBP Board. The assessment of our clients and counterparties includes consideration of their character, integrity, core competencies, track record and financial strength. A strong emphasis is placed on the historic and ongoing stability of income and cash flow streams generated by the clients. Our primary assessment method is therefore the ability of the client or counterparty to meet their payment obligations. Target clients include high net worth individuals, active wealth creators, high-income professionals, self-employed entrepreneurs, owner managers in small to mid-cap corporates, sophisticated investors, established corporates, small and medium-sized enterprises, financial institutions and sovereigns. We are client-centric in our approach and originate the majority of our loans with the intent of holding these assets to maturity, thereby developing a ‘hands-on’ and long-standing relationship. Interbank lending is largely reserved for those banks and institutions in the Bank’s core geographies of activity, which are systemic and highly rated. | | | | --- | --- | | | | | Unaudited_information.svg | Concentration risk | Concentration risk, with respect to credit and counterparty risk, is when large exposures exist to a single client or counterparty, group of connected counterparties, or to a particular geography, asset class or industry. An example of this would be where a number of counterparties are affected by similar economic, legal, regulatory or other factors that could mean their ability to meet contractual obligations are correlated. Concentration risk can also exist where portfolio loan maturities are clustered to single periods in time. Loan maturities are monitored on a portfolio and a transaction level by Investec Group risk management, Group lending operations as well as the originating business units. Credit and counterparty risk is always assessed with reference to the aggregate exposure to a single counterparty or group of related parties to manage concentration risk. In order to manage concentration, we will consider a sell-down of exposures to market participants if required. 249 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Unaudited_information.svg | Country risk | Country risk, with respect to credit and counterparty risk, refers to the risk of lending to a counterparty operating in a particular country or the risk inherent in a sovereign exposure, i.e. the risk of exposure to loss caused by events in that country. Country risk covers all forms of lending or investment activity whether to/with individuals, corporates, banks or governments. This can include geopolitical risks, transfer and convertibility risks, and the impact on the borrower’s credit profile due to local economic and political conditions. To mitigate country risk, there is a preference for primary exposure in the Bank’s main operating geography. The Bank will accept exposures where we have a branch or local banking subsidiary, and tolerate exposures to other countries where we are facilitating a transaction for a client who requires facilities in a foreign geography and where we have developed a local understanding and capability. The Bank’s credit risk appetite with regard to country risk is characterised by the following principles: • Preference is to have exposure only to politically stable jurisdictions that we understand and have preferably operated in before • There is limited specific appetite for exposures outside of the Bank’s pre-existing core geographies or target markets • The legal environment should be tested, have legal precedent in line with OECD standards and have good corporate governance • In certain cases, country risk can be mitigated by taking out political risk insurance with suitable counterparties where deemed necessary and where considered economic. While we do not have a separate country risk committee, the relevant credit committees as well as investment committees, IBP ERC and where necessary, Investec Group ERC will consider, analyse and assess the appropriate foreign jurisdiction limits. In the UK, following the official exit from the European Union, it remains necessary to avoid exposures to certain European countries due to the resulting legal and regulatory implications. This relates specifically to countries in which borrowers are legally incorporated and any deal will be thoroughly assessed on a case by case basis to ensure compliance with current regulations. | | | | --- | --- | | | | | Unaudited_information.svg | Sustainability risk | We assess sustainability risk as part of the credit or investment committee’s evaluation of lending or investment decisions. All credit and investment transactions with exposure to high-risk industries go through a sustainability screening process. Where the transaction is classified as high-risk, a sustainability screening is required prior to the credit committee where risks and opportunities are identified to assist the credit committee in their decision-making process. Where risks are identified, mitigating actions need to be included. Sustainability considerations are implicit in our values, culture and code of conduct and are applied as part of our day to day decision making. In particular, the following factors are considered when a transaction is evaluated and approved or declined based on sustainability considerations: • Governance matters (including corruption, fraud and controversies) • Environmental impacts (including climate, nature degradation and animal welfare) to support climate action (SDG 13) • Social injustice (including human rights, diversity, inclusion and modern slavery, community displacement and health and safety risks) to support reduced in equalities (SDG 10) • Ethical considerations (including human rights and modern slavery) to support SDG 10 • Macro-economic impacts (including poverty, growth, and unemployment) to support SDG 13 and SDG 10. If the Group sustainability team flags the transaction as a high concern issue, it will be escalated to IBP or Investec Group ERC before any credit or investment decision is made. Moreover, the DLC SEC is informed of any transactions identified with high concerns. | | | | --- | --- | | | | | Page_references.svg | Refer to pages [269](#i447e4d363cd344738300acdd42f0e3a0_505) to 269 for further detail. | | | | | --- | --- | | | | | Unaudited_information.svg | Stress testing | The Bank’s stress testing framework is designed to identify and assess vulnerabilities under stress. The process comprises a bottom-up analysis of the Bank’s material business activities, incorporating views from risk management teams, business and the executive. Stress scenarios are designed based on findings from the bottom-up process, taking into consideration the broader macro-economic and political risk backdrop. These IBP-specific stress scenarios form an integral part of our capital planning process and IFRS 9 reporting. The stress testing process also informs the risk appetite review process, and the management of risk appetite limits and is a key risk management tool of the Bank. This process allows the Bank to identify underlying risks and manage them accordingly. The Bank also performs ad hoc stress tests and reverse stress testing. Ad hoc stress tests are conducted in response to any type of material and/or emerging risks, with reviews undertaken of impacted portfolios to assess any migration in quality and highlight any vulnerabilities, identify portfolio concentrations and make appropriate recommendations such as a reduction in risk appetite limits. Reverse stress tests are conducted to stress the Bank’s business plan to failure and consider a broad variety of extreme and remote events. 250 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | --- | | | | Risk management and measurement | Fundamental principles employed in the management of credit and counterparty risk include: • A clear definition of our target market • A quantitative and qualitative assessment of the creditworthiness of our clients and counterparties • Analysis of risks, including concentration risk (concentration risk considerations include asset class, industry, counterparty and geographical concentration) • Decisions being made with reference to risk appetite limits • Prudential limits • Regular monitoring and review of existing and potential exposures once facilities have been approved • A high level of executive involvement in decision-making with non-executive review and oversight where applicable • Portfolio reviews and stress testing. Within the credit approval process, internal and external ratings are included in the assessment of client quality. A large proportion of the Bank’s portfolio is not rated by external rating agencies. We place reliance upon internal consideration of clients, counterparties and borrowers and use ratings prepared externally where available to support our decision- making process. Regular reporting of credit and counterparty risk exposures within our operating units are made to management, the executives , IBP BRCC and DLC BRCC. The IBP Board reviews and approves the appetite for credit and counterparty risk, which is documented in risk appetite statements and policy documents. This is implemented and reviewed by the credit risk management teams in each jurisdiction. Reviews are also undertaken of all material businesses, where the portfolios are analysed to assess any migration in portfolio quality, highlight any vulnerabilities, identify portfolio concentrations and make appropriate recommendations, such as a reduction in risk appetite limits or specific exposures. | | | | --- | --- | | | | | Unaudited_information.svg | Nature of activities | Credit and counterparty risk is assumed through a range of client-driven lending activities to private and corporate clients as well as other counterparties, such as financial institutions and sovereigns. These activities are diversified across a number of business activities: • Core loans and advances: the majority of credit and counterparty risk is through core loans and advances, which reflects client-driven lending activities to private and corporate clients and account for almost all ECL allowances across our portfolio, which are detailed on pages [252](#i447e4d363cd344738300acdd42f0e3a0_493) to [259](#if628b0cc73c0412cae7b495fdc844c21_30-0-1-1-2494133) • Treasury function: there are also certain exposures, outside of core loans and advances, where we assume credit and counterparty risk. These arise from treasury investments in high-quality liquid assets, including highly rated government, supranational, sub-sovereign and agency (SSA) and covered bonds, and treasury placements where the treasury function, as part of the daily management of the Bank’s liquidity, places funds with central banks and other commercial banks and financial institutions. These transactions are typically short- term (less than one month) money market placements or secured repurchase agreements. These market counterparties are mainly investment grade rated entities that occupy dominant and systemic positions in their domestic banking markets and internationally. These counterparties are located mainly in the UK, Western Europe, Asia, North America and Australia. In addition, credit and counterparty risk arises through the following exposures: • Customer trading activities to facilitate hedging of client risk positions: our customer trading portfolios consist of derivative contracts in interest rates, foreign exchange, commodities, credit derivatives and equities that are entered into, to facilitate a client’s hedging requirements. The counterparties to such transactions are typically corporates, in particular where they have an exposure to interest rates or foreign exchange due to operating in sectors that include imports and exports of goods and services. These positions are marked-to-market, typically with daily margin calls to mitigate credit exposure in the event of counterparty default • Structured credit: these are bonds secured against a pool of assets, mainly UK residential mortgages or European or US corporate leverage loans. The bonds are typically highly rated (single ‘A’ and above), which benefit from a high level of credit subordination and can withstand a significant level of portfolio default • Debt securities: from time to time we take on exposures by means of corporate debt securities rather than loan exposures. These transactions arise on the back of client relationships or knowledge of the corporate market and are based on our analysis of the credit fundamentals • Corporate advisory and investment banking activities: counterparty risk in this area is modest. The business also trades shares on an approved basis and makes markets in shares where we are appointed corporate broker under pre- agreed market risk limits. Settlement trades are largely on a delivery versus payment basis, through major stock exchanges. Credit risk only occurs in the event of counterparty failure and would be linked to any fair value losses on the underlying security • Settlement risk: can arise due to undertaking transactions in an agency capacity on behalf of clients. However, the risk is not considered to be material as most transactions are undertaken on recognised exchanges, with large institutional clients, monitored daily, with trades usually settled within two to three days. 251 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Credit risk mitigation Credit risk mitigation techniques can be defined as all methods by which the Bank seeks to decrease the credit risk associated with an exposure. The Bank considers credit risk mitigation techniques as part of the credit assessment of a potential client or business proposal and not as a separate consideration of mitigation of risk. Credit risk mitigants can include any collateral item over which the Bank has a charge over assets, netting and margining agreements, covenants, or terms and conditions imposed on a borrower with the aim of reducing the credit risk inherent to that transaction. As the Bank has limited appetite for unsecured debt. A strong emphasis is placed on proven income and cash flows generated by the clients and risk is managed through assessment of the ability of clients to meet their payment obligations and/or tangible assets provided in support of their obligations. Collateral is assessed with reference to the sustainability of value and the likelihood of realisation. Acceptable collateral generally exhibits characteristics that allow for it to be easily identified and appropriately valued and assists the Bank to recover outstanding exposures. Where a transaction is supported by a mortgage or charge over property, the primary credit risk is still taken on the borrower. In addition, the relevant credit committee normally requires a suretyship or guarantee in support of a transaction in our private client business. For property-backed lending we also consider the client’s overall balance sheet. The following characteristics of the property are also considered: the type of property; its location; and the ease with which the property could be relet and/or resold. Where the property is secured by lease agreement, the credit committee prefers not to lend for a term beyond the maximum term of the lease. Commercial real estate generally takes the form of good quality property often underpinned by strong third party leases. Residential property is also generally of a high quality and based in desirable locations. Residential and commercial property valuations will continue to form part of our ongoing focus on collateral assessment. It is our policy to obtain a formal valuation of every commercial property offered as collateral for a lending facility before advancing funds. Residential properties are valued by desktop valuation and/or approved valuers, where appropriate. Other common forms of collateral in the retail asset class are motor vehicles, cash and share portfolios. Primary collateral in private client lending transactions can also include a high net worth individual’s share/investment portfolio. This is typically in the form of a diversified pool of equity, fixed income, managed funds and cash. Often these portfolios are managed by Rathbones. Lending against investment portfolios is typically geared at conservative loan-to-value (LTV) ratios, after considering the quality, diversification, risk profile and liquidity of the portfolio. Our corporate, government and institutional clients provide a range of collateral including cash, corporate assets, debtors (accounts receivable), trading stock, debt securities (bonds), listed and unlisted shares and guarantees. The majority of credit mitigation techniques linked to trading activity is in the form of netting agreements and daily margining. Primarily, the market standard legal documents that govern this include the International Swaps and Derivatives Association (ISDA) Master Agreements, Global Master Securities Lending Agreement (GMSLA) and Global Master Repurchase Agreement (GMRA). In addition to having ISDA documentation in place with market and trading counterparties in over-the-counter (OTC) derivatives, the credit committee may require a Credit Support Annex (CSA) to ensure that mark-to-market credit exposure is mitigated daily through the calculation and placement/receiving of cash collateral. Where netting agreements have been signed, the enforceability is supported by an external legal opinion within the legal jurisdiction of the agreement. Set-off is applied between assets, subject to credit risk and related liabilities in the annual financial statements, where: • A legally enforceable right to set-off exists • There is the intention to settle the asset and liability on a net basis, or to realise the asset and settle the liability simultaneously. In addition to the above accounting set-off criteria, banking regulators impose the following additional criteria: • Debit and credit balances relate to the same • obligor/counterparty • Debit and credit balances are denominated in the same currency and have identical maturities • Exposures subject to set-off are risk-managed on a net basis • Market practice considerations. For this reason, there will be instances where credit and counterparty exposures are displayed on a net basis in these annual financial statements but reported on a gross basis to regulators. The legal risk function ensures the enforceability of credit risk mitigants within the laws applicable of the jurisdictions in which the Bank operates. When assessing the potential concentration risk in its credit portfolio, consideration is given to the types of collateral and credit protection that form part of the portfolio. 252 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Alternative_performance_measures.svg | An analysis of gross core loans, asset quality and ECL | The tables that follow provide information with respect to the asset quality of our gross core loans on a statutory basis. Stage 3 exposures as a percentage of gross core loans subject to ECL have remained unchanged at 3.3% driven by the resolution of existing defaults and a reduced rate of new defaults. Stage 2 exposures have decreased to £1 328 million or 8.1% of gross core loans subject to ECL at 31 March 2025 (£1 391 million or 8.6% at 31 March 2024) reflecting the continued performance of the underlying portfolios in the current macro-economic environment. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’million | 31 March 2025 | | 31 March 2024 | | | Gross core loans | 16 956 | | 16 744 | | | Gross core loans at FVPL | 572 | | 641 | | | Gross core loans subject to ECL\* | 16 384 | | 16 103 | | | Stage 1 | 14 520 | | 14 181 | | | Stage 2 | 1 328 | | 1 391 | | | of which past due greater than 30 days | 60 | | 150 | | | Stage 3# | 536 | | 531 | | | ECL^ | (165) | | (187) | | | Stage 1 | (34) | | (43) | | | Stage 2 | (31) | | (33) | | | Stage 3 | (100) | | (111) | | | Coverage ratio | | | | | | Stage 1 | 0.23% | | 0.30% | | | Stage 2 | 2.3% | | 2.4% | | | Stage 3 | 18.7% | | 20.9% | | | Credit loss ratio | 0.60% | | 0.58% | | | ECL impairment charges on core loans | (97) | | (90) | | | Average gross core loans subject to ECL | 16 244 | | 15 631 | | | An analysis of Stage 3 gross core loans subject to ECL | | | | | | Stage 3 net of ECL | 436 | | 420 | | | Aggregate collateral and other credit enhancements on Stage 3 | 455 | | 445 | | | Stage 3 as a % of gross core loans subject to ECL | 3.3% | | 3.3% | | | Stage 3 net of ECL as a % of net core loans subject to ECL | 2.7% | | 2.6% | | Note: Our exposure (net of ECL) to the Legacy portfolio has reduced from £ 32 million at 31 March 2024 to £27 million at 31 March 2025 . These Legacy assets are predominately reported in Stage 3. These assets have been significantly provided for and coverage remains high at 53.8% . \*Refer to definitions on page [393](#i447e4d363cd344738300acdd42f0e3a0_535). #Stage 3 exposures disclosed above and in the tables that follow are net of suspended interest. Refer to page [254](#i8683aa45f40141da8629043c9d38f60b_8943) for additional information. ^ Comprises ECL held against both amortised cost and FVOCI loans. | | | | --- | --- | | | | | Unaudited_information.svg | An analysis of gross core loans by country of exposure | | | | | | --- | --- | --- | | | | | | 31 March 2025 | | 31 March 2024 | | £16 956 million | | £16 744 million | ![542]() ![544]() | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | United Kingdom | 83.6% | | | United Kingdom | 83.3% | | | Europe (excluding UK) | 10.0% | | | Europe (excluding UK) | 9.1% | | | North America | 4.4% | | | North America | 5.2% | | | Asia | 1.6% | | | Asia | 1.7% | | | Other | 0.4% | | | Other | 0.7% | 253 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | --- | | | | An analysis of staging and ECL movements for core loans subject to ECL | The table below indicates underlying movements in gross core loans subject to ECL from 31 March 2024 to 31 March 2025. The transfers between stages of gross core loans indicate the impact of stage transfers upon the gross exposure and associated opening ECL. There have been increased repayments in Stage 2, contributing to the overall decrease in Stage 2 exposure since 31 March 2024. Transfers into Stage 3 since 31 March 2024 have slowed when compared to the year to 31 March 2024. The ECL remeasurement arising from transfer of stage represents the (increase)/decrease in ECL due to stage transfers. New lending net of repayments comprises new originations, further drawdowns, repayments and sell-downs and Stage 3 ECLs that have been written off, typically when an asset has been sold. The ECL impact of changes to risk parameters and models during the year relate to the adjustment of model changes to more effectively calculate probability of default (PD) reflective of the current experience in the economic environment. The foreign exchange and other category largely comprises the impact on the closing balance as a result of movements and translations in foreign exchange rates since 31 March 2024. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Stage 1 | | Stage 2 | | Stage 3 | | Total | | | £’million | Gross exposure | ECL | Gross exposure | ECL | Gross exposure | ECL | Gross exposure | ECL | | At 31 March 2024 | 14 181 | (43) | 1 391 | (33) | 531 | (111) | 16 103 | (187) | | Lending collateralised by property at 31 March 2024 | 2 155 | (10) | 168 | (3) | 144 | (35) | 2 467 | (48) | | Transfer from Stage 1 | (160) | 1 | 147 | (1) | 13 | — | — | — | | Transfer from Stage 2 | 12 | — | (69) | 1 | 57 | (1) | — | — | | Transfer from Stage 3 | — | — | — | — | — | — | — | — | | ECL remeasurement arising from transfer of stage | — | — | — | — | — | — | — | — | | New lending net of repayments (includes assets written off) | (97) | 4 | 2 | — | (56) | 12 | (151) | 16 | | Changes to risk parameters and models | — | — | — | — | — | — | — | — | | Foreign exchange and other | — | — | — | — | — | — | — | — | | Lending collateralised by property at 31 March 2025 | 1 910 | (5) | 248 | (3) | 158 | (24) | 2 316 | (32) | | HNW and other private client lending at 31 March 2024 | 5 263 | (6) | 260 | (1) | 170 | (16) | 5 693 | (23) | | Transfer from Stage 1 | (148) | — | 88 | — | 60 | — | — | — | | Transfer from Stage 2 | 57 | — | (83) | — | 26 | — | — | — | | Transfer from Stage 3 | — | — | 19 | — | (19) | — | — | — | | ECL remeasurement arising from transfer of stage | — | — | — | — | — | (1) | — | (1) | | New lending net of repayments (includes assets written off) | 239 | (1) | (62) | — | (42) | (2) | 135 | (3) | | Changes to risk parameters and models | — | (2) | — | — | — | — | — | (2) | | Foreign exchange and other | (2) | — | — | — | — | — | (2) | — | | HNW and other private client lending at 31 March 2025 | 5 409 | (9) | 222 | (1) | 195 | (19) | 5 826 | (29) | | Corporate and other lending at 31 March 2024 | 6 763 | (27) | 963 | (29) | 217 | (60) | 7 943 | (116) | | Transfer from Stage 1 | (468) | 3 | 431 | (3) | 37 | — | — | — | | Transfer from Stage 2 | 272 | (4) | (343) | 9 | 71 | (5) | — | — | | Transfer from Stage 3 | 1 | — | 11 | (1) | (12) | 1 | — | — | | ECL remeasurement arising from transfer of stage | — | 3 | — | (9) | — | (13) | — | (19) | | New lending net of repayments (includes assets written off) | 666 | (2) | (198) | 2 | (129) | 19 | 339 | 19 | | Changes to risk parameters and models | — | 7 | — | 4 | — | — | — | 11 | | Foreign exchange and other | (33) | — | (6) | — | (1) | 1 | (40) | 1 | | Corporate and other lending at 31 March 2025 | 7 201 | (20) | 858 | (27) | 183 | (57) | 8 242 | (104) | | At 31 March 2025 | 14 520 | (34) | 1 328 | (31) | 536 | (100) | 16 384 | (165) | 254 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Stage 1 | | Stage 2 | | Stage 3 | | Total | | | £’million | Gross exposure | ECL | Gross exposure | ECL | Gross exposure | ECL | Gross exposure | ECL | | At 31 March 2023 | 13 494 | (39) | 1 321 | (32) | 343 | (75) | 15 158 | (146) | | Lending collateralised by property at 31 March 2023 | 1 852 | (8) | 343 | (12) | 121 | (34) | 2 316 | (54) | | Transfer from Stage 1 | (147) | 1 | 119 | (1) | 28 | — | — | — | | Transfer from Stage 2 | 194 | (3) | (241) | 5 | 47 | (2) | — | — | | Transfer from Stage 3 | — | — | — | — | — | — | — | — | | ECL remeasurement arising from transfer of stage | — | 2 | — | — | — | (1) | — | 1 | | New lending net of repayments (includes assets written off) | 256 | (2) | (53) | 4 | (52) | 2 | 151 | 4 | | Changes to risk parameters and models | — | — | — | 1 | — | — | — | 1 | | Foreign exchange and other | — | — | — | — | — | — | — | — | | Lending collateralised by property at 31 March 2024 | 2 155 | (10) | 168 | (3) | 144 | (35) | 2 467 | (48) | | HNW and other private client lending at 31 March 2023 | 5 343 | (4) | 164 | (1) | 84 | (13) | 5 591 | (18) | | Transfer from Stage 1 | (309) | — | 189 | — | 120 | — | — | — | | Transfer from Stage 2 | 48 | — | (61) | — | 13 | — | — | — | | Transfer from Stage 3 | — | — | — | — | — | — | — | — | | ECL remeasurement arising from transfer of stage | — | — | — | — | — | (1) | — | (1) | | New lending net of repayments (includes assets written off) | 184 | (2) | (32) | — | (47) | (1) | 105 | (3) | | Changes to risk parameters and models | — | — | — | — | — | (1) | — | (1) | | Foreign exchange and other | (3) | — | — | — | — | — | (3) | — | | HNW and other private client lending at 31 March 2024 | 5 263 | (6) | 260 | (1) | 170 | (16) | 5 693 | (23) | | Corporate and other lending at 31 March 2023 | 6 299 | (27) | 814 | (19) | 138 | (28) | 7 251 | (74) | | Transfer from Stage 1 | (589) | 4 | 521 | (4) | 68 | — | — | — | | Transfer from Stage 2 | 241 | (5) | (292) | 7 | 51 | (2) | — | — | | Transfer from Stage 3 | — | — | — | — | — | — | — | — | | ECL remeasurement arising from transfer of stage | — | 4 | — | (10) | — | (28) | — | (34) | | New lending net of repayments (includes assets written off) | 854 | (3) | (72) | (4) | (39) | (2) | 743 | (9) | | Changes to risk parameters and models | — | — | — | 1 | — | — | — | 1 | | Foreign exchange and other | (42) | — | (8) | — | (1) | — | (51) | — | | Corporate and other lending at 31 March 2024 | 6 763 | (27) | 963 | (29) | 217 | (60) | 7 943 | (116) | | At 31 March 2024 | 14 181 | (43) | 1 391 | (33) | 531 | (111) | 16 103 | (187) | Interest in suspense For asset quality risk management and disclosure purposes, interest in suspense has been excluded from the gross loans and advances as well as the balance sheet ECL balances of Stage 3 assets. Below is a summary of interest in suspense allocated to Stage 3 core loans by risk appetite category. | | | | | --- | --- | --- | | | | | | £’million | 31 March 2025 | 31 March 2024 | | Commercial real estate | 1.2 | 0.8 | | Residential real estate | 5.5 | 3.4 | | Total lending collateralised by property | 6.7 | 4.2 | | Other high net worth lending | 0.4 | — | | Total high net worth and other private client lending | 0.4 | — | | Corporate and acquisition finance | 2.9 | 0.4 | | Other corporate and financial institutions and governments | — | — | | Asset finance | 1.2 | 0.5 | | Aviation finance | 0.4 | — | | Total corporate and other lending | 4.5 | 0.9 | | Total core loans | 11.6 | 5.1 | 255 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | --- | | | | An analysis of credit quality by internal rating grade | The Bank uses a 25-grade internal rating scale which measures the risk of default to an exposure without taking into account any credit mitigation, such as collateral. This internal rating scale allows the Bank to measure credit risk consistently across portfolios. The internal rating scale is derived from a mapping to PDs and can also be mapped to external rating agency scales. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | PD range | | Investec internal rating scale | | Indicative external rating scale | | less than 0.538% | | IB01 – IB12 | | AAA to BBB- | | 0.538% – 6.089% | | IB13 – IB19 | | BB+ to B- | | greater than 6.089% | | IB20 – IB25 | | B- and below | | | | Stage 3 | | D | The internal credit rating distribution below is based on the 12-month PD at 31 March 2025 for gross core loans subject to ECL by stage. The staging classifications are not only driven by the absolute PD, but on factors that determine a significant increase in credit risk, including relative movement in PD since origination. There is therefore no direct correlation between the credit quality of an exposure and its stage classification as shown in the table below: | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | At 31 March 2025 | IB01-IB12 | IB13-IB19 | IB20-IB25 | Stage 3 | | Total | | | £’million | | | | Gross core loans subject to ECL | 7 101 | 8 369 | 378 | 536 | | 16 384 | | | Stage 1 | 6 966 | 7 525 | 29 | — | | 14 520 | | | Stage 2 | 135 | 844 | 349 | — | | 1 328 | | | Stage 3 | — | — | — | 536 | | 536 | | | ECL | (5) | (42) | (18) | (100) | | (165) | | | Stage 1 | (5) | (28) | (1) | — | | (34) | | | Stage 2 | — | (14) | (17) | — | | (31) | | | Stage 3 | — | — | — | (100) | | (100) | | | Coverage ratio | 0.1% | 0.5% | 4.8% | 18.7% | | 1.0% | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | At 31 March 2024 | IB01-IB12 | IB13-IB19 | IB20-IB25 | Stage 3 | | Total | | | £’million | | | | Gross core loans subject to ECL | 7 662 | 7 590 | 320 | 531 | | 16 103 | | | Stage 1 | 7 408 | 6 723 | 50 | — | | 14 181 | | | Stage 2 | 254 | 867 | 270 | — | | 1 391 | | | Stage 3 | — | — | — | 531 | | 531 | | | ECL | (7) | (50) | (19) | (111) | | (187) | | | Stage 1 | (6) | (36) | (1) | — | | (43) | | | Stage 2 | (1) | (14) | (18) | — | | (33) | | | Stage 3 | — | — | — | (111) | | (111) | | | Coverage ratio | 0.1% | 0.7% | 5.9% | 20.9% | | 1.2% | | For all other financial instruments including other financial assets (which include exposures to highly rated international banks and corporate bonds) subject to credit and counterparty risk, the Bank applies credit ratings in line with its credit policies. Assessment and suitability of the rating is vetted by the applicable credit authority and monitored as part of the overall credit management process. Where new information that may affect the risk profile becomes available, this is considered and ratings may be adjusted accordingly. 256 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | --- | | | | An analysis of core loans by risk category – Lending collateralised by property | Client quality and expertise are at the core of our credit philosophy. We provide senior debt and other funding for property transactions, with a preference for income-producing assets, supported by an experienced sponsor providing a material level of cash equity investment into the asset and limited direct exposure to sectors more vulnerable to cyclicality. Our exposure to the property market is well diversified with strong bias towards prime locations for residential exposure and focus on property fundamentals, tenant quality and income diversity for commercial assets. Debt service cover ratios are a key consideration in the lending process supported by reasonable loan-to-security value ratios. Year in review Lending collateralised by property totalled £2.3 billion or 13.9% of net core loans at 31 March 2025, which remains in line with the Group’s risk appetite to maintain a reduced proportion of net core loan exposures in property-related lending. New lending is diversified by underlying asset classes at conservative LTVs. Weighted average LTV\* on lending collateralised by property remains conservative at 57%. Development exposures are typically undertaken at lower LTVs. These LTVs do not take into account guarantees provided by borrowers which provide additional security to our lending and would reduce LTV metrics further. Property collateralised assets are almost entirely located in the UK. Underwriting criteria remains conservative and we are committed to following a client-centric approach to lending, supporting counterparties with strong balance sheets and requisite expertise. | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | Gross core loans at amortised cost and FVOCI | | | | | | | | | | Gross core loans at FVPL | Gross core loans | | | | Stage 1 | | Stage 2 | | Stage 3 | | | Total | | | | | | | £’million | Gross exposure | ECL | Gross exposure | ECL | Gross exposure | ECL | | Gross exposure | ECL | | | | | | At 31 March 2025 | | | | | | | | | | | | | | | Commercial real estate | 1 251 | (4) | 219 | (3) | 72 | (8) | | 1 542 | (15) | | 45 | 1 587 | | | Commercial real estate – investment | 1 043 | (4) | 125 | (2) | 72 | (8) | | 1 240 | (14) | | 34 | 1 274 | | | Commercial real estate – development | 207 | — | 88 | (1) | — | — | | 295 | (1) | | 11 | 306 | | | Commercial vacant land and planning | 1 | — | 6 | — | — | — | | 7 | — | | — | 7 | | | Residential real estate | 659 | (1) | 29 | — | 86 | (16) | | 774 | (17) | | 5 | 779 | | | Residential real estate – investment | 381 | (1) | 13 | — | 46 | (3) | | 440 | (4) | | 5 | 445 | | | Residential real estate – development | 264 | — | 8 | — | 17 | (1) | | 289 | (1) | | — | 289 | | | Residential vacant land and planning | 14 | — | 8 | — | 23 | (12) | | 45 | (12) | | — | 45 | | | Total lending collateralised by property | 1 910 | (5) | 248 | (3) | 158 | (24) | | 2 316 | (32) | | 50 | 2 366 | | | Coverage ratio | | 0.26% | | 1.21% | | 15.19% | | | 1.38% | | | | | | At 31 March 2024 | | | | | | | | | | | | | | | Commercial real estate | 1 365 | (8) | 119 | (3) | 92 | (21) | | 1 576 | (32) | | 49 | 1 625 | | | Commercial real estate – investment | 1 045 | (7) | 102 | (1) | 86 | (17) | | 1 233 | (25) | | 45 | 1 278 | | | Commercial real estate – development | 320 | (1) | 11 | (2) | — | — | | 331 | (3) | | 4 | 335 | | | Commercial vacant land and planning | — | — | 6 | — | 6 | (4) | | 12 | (4) | | — | 12 | | | Residential real estate | 790 | (2) | 49 | — | 52 | (14) | | 891 | (16) | | 5 | 896 | | | Residential real estate – investment | 502 | (2) | 40 | — | 25 | (2) | | 567 | (4) | | 5 | 572 | | | Residential real estate – development | 262 | — | 8 | — | 4 | (1) | | 274 | (1) | | — | 274 | | | Residential vacant land and planning | 26 | — | 1 | — | 23 | (11) | | 50 | (11) | | — | 50 | | | Total lending collateralised by property | 2 155 | (10) | 168 | (3) | 144 | (35) | | 2 467 | (48) | | 54 | 2 521 | | | Coverage ratio | | 0.46% | | 1.79% | | 24.31% | | | 1.95% | | | | | \*Excludes a small portion of Legacy exposures that are predominately reported in Stage 3. 257 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | --- | | | | An analysis of core loans by risk category – High net worth and other private client lending | Our Private Banking activities target high net worth individuals, active wealth creators, high-income professionals, self- employed entrepreneurs, owner managers in small to mid-cap corporates and sophisticated investors. Lending products are tailored to meet the requirements of our clients and deliver solutions to enable target clients to create and manage their wealth. Central to our credit philosophy is ensuring the sustainability of cash flow and income throughout the cycle. As such, the client base has been defined to include high net worth clients (who, through diversification of income streams, should reduce income volatility) and individuals in defined professions which have historically supported a sustainable income base, irrespective of the stage in the economic cycle. Credit risk arises from the following activities: • Mortgages: provides residential mortgage loan facilities to target market clients • Other high net worth lending: provides credit facilities to high net worth individuals and their controlled entities as well as portfolio loans to high net worth clients against their investment portfolios typically managed by Rathbones. Year in review High net worth and other private client lending totalled £5.8 billion or 34.7% of UK net core loans at 31 March 2025. There was growth in mortgages of 4.9% in the year to 31 March 2025 despite market activity being affected by the high interest rate environment. Growth in this area has been achieved with strong adherence to our lending criteria. Weighted average LTVs on mortgages is 65%. | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | Gross core loans at amortised cost and FVOCI | | | | | | | | | | Gross core loans at FVPL | Gross core loans | | | | Stage 1 | | Stage 2 | | Stage 3 | | | Total | | | | | | | £’million | Gross exposure | ECL | Gross exposure | ECL | Gross exposure | ECL | | Gross exposure | ECL | | | | | | At 31 March 2025 | | | | | | | | | | | | | | | Mortgages | 4 833 | (8) | 151 | (1) | 135 | (7) | | 5 119 | (16) | | 26 | 5 145 | | | Other high net worth lending | 576 | (1) | 71 | — | 60 | (12) | | 707 | (13) | | 9 | 716 | | | Total high net worth and other private client lending | 5 409 | (9) | 222 | (1) | 195 | (19) | | 5 826 | (29) | | 35 | 5 861 | | | Coverage ratio | | 0.17% | | 0.5% | | 9.7% | | | 0.5% | | | | | | At 31 March 2024 | | | | | | | | | | | | | | | Mortgages | 4 589 | (4) | 162 | — | 105 | (4) | | 4 856 | (8) | | 41 | 4 897 | | | Other high net worth lending | 674 | (2) | 98 | (1) | 65 | (12) | | 837 | (15) | | 2 | 839 | | | Total high net worth and other private client lending | 5 263 | (6) | 260 | (1) | 170 | (16) | | 5 693 | (23) | | 43 | 5 736 | | | Coverage ratio | | 0.11% | | 0.4% | | 9.4% | | | 0.4% | | | | | 258 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | --- | | | | An analysis of core loans by risk category – Corporate and other lending | We focus on traditional client-driven corporate lending activities. The credit risk management functions approve specific credit and counterparty limits that govern the maximum credit exposure to each individual counterparty. In addition, further risk management limits exist through industry and country limits to manage concentration risk. The credit appetite for each counterparty is based on the financial strength of the principal borrower, its business model and market positioning, the underlying cash flow to the transaction, the substance and track record of management, and the security package. Political risk insurance, and other insurance is taken where deemed appropriate. The Bank has limited appetite for unsecured credit risk and facilities are typically secured by the assets of the underlying borrower as well as shares in the borrower. A summary of the nature of the lending and/or credit risk assumed within some of the key areas in our corporate lending business is provided below: • Corporate and acquisition finance: provides senior secured loans to proven management teams and sponsors running mid-cap, as well as some large-cap companies. Credit risk is assessed against debt serviceability based upon robust cash generation of the business demonstrated by both historical and forecast information. Corporates should demonstrate relevance in their market, an experienced management team, able Board members, and strong earnings and cash flow. We typically act as a transaction lead arranger or on a club or bi- lateral basis, and have a close relationship with management and sponsors • Asset-based lending: provides working capital and secured corporate loans to mid-caps. These loans are secured by the assets of the business, for example, the accounts receivable, inventory and plant and machinery. In common with our corporate lending activities, strong emphasis is placed on supporting companies with scale and relevance in their industry • Fund finance: provides debt facilities to asset managers and fund vehicles, principally in private equity. The geographical focus is the UK, Western Europe and North America where the Bank can support experienced asset managers and their funds which show strong, long-term value creation and good custodianship of investors’ money. Debt facilities are typically to fund vehicles which are secured against undrawn limited partner commitments and/or the fund’s underlying assets • Other corporate and financial institutions and governments: provides senior secured loans to mid-to-large cap companies where credit risk is typically considered with regard to robust cash generation from an underlying asset and supported by performance of the overall business based on both historical and forecast information • Small ticket asset finance: provides funding to small- and medium-sized corporates to support asset purchases and other business requirements. The portfolio is highly diversified by industry and number of clients and is secured against the asset being financed • Motor finance: provides specialised motor vehicle financing originated through Mann Island Vehicle Finance Limited (MIVF). The portfolio is composed predominantly of private motor vehicles to individuals attributing to a granular book with low concentration risk • Aviation finance: structures, arranges and provides financing for airlines, leasing companies, operators and corporates secured by aircraft at conservative LTVs. Counterparties include flag and commercial airline carriers, leading aircraft lessors and corporates/operators with strong contracted cash flows • Energy and infrastructure finance: arranges and provides typically long-term financing for energy and infrastructure assets, in particular renewable and traditional energy projects as well as transportation assets, typically against contracted future cash flows of the project(s) from well-established and financially sound off-take counterparties. There is a requirement for a strong upfront equity contribution from an experienced sponsor. Year in review Corporate and other lending increased by 3.0% from £8.4 billion at 31 March 2024 to £8.6 billion or 51.4% of net core loans at 31 March 2025 . There has been diversified growth across multiple corporate and other lending asset classes including fund finance, small ticket asset finance, asset-based lending, other corporate and financial institutions and governments, energy and infrastructure finance and aviation finance. We continue to remain client-focused in our approach, with good quality corporates exhibiting strong cash flows and balance sheets. The underlying portfolios remain resilient. 259 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Gross core loans at amortised cost and FVOCI | | | | | | | | Gross core loans at FVPL | Gross core loans | | | Stage 1 | | Stage 2 | | Stage 3 | | Total | | | | | £’million | Gross exposure | ECL | Gross exposure | ECL | Gross exposure | ECL | Gross exposure | ECL | | | | At 31 March 2025 | | | | | | | | | | | | Corporate and acquisition finance | 1 732 | (6) | 229 | (9) | 73 | (14) | 2 034 | (29) | 112 | 2 146 | | Asset-based lending | 208 | (1) | 142 | (3) | — | — | 350 | (4) | — | 350 | | Fund finance | 1 466 | (1) | 30 | — | — | — | 1 496 | (1) | 68 | 1 564 | | Other corporate and financial institutions and governments | 669 | (2) | 56 | (2) | 18 | (16) | 743 | (20) | 4 | 747 | | Small ticket asset finance | 1 433 | (6) | 199 | (7) | 23 | (11) | 1 655 | (24) | — | 1 655 | | Motor finance | 994 | (2) | 97 | (4) | 28 | (11) | 1 119 | (17) | — | 1 119 | | Aviation finance | 175 | — | 7 | — | — | — | 182 | — | 279 | 461 | | Energy and infrastructure finance | 524 | (2) | 98 | (2) | 41 | (5) | 663 | (9) | 24 | 687 | | Total corporate and other lending | 7 201 | (20) | 858 | (27) | 183 | (57) | 8 242 | (104) | 487 | 8 729 | | Coverage ratio | | 0.28% | | 3.1% | | 31.1% | | 1.3% | | | | At 31 March 2024 | | | | | | | | | | | | Corporate and acquisition finance | 1 831 | (9) | 249 | (7) | 102 | (33) | 2 182 | (49) | 135 | 2 317 | | Asset-based lending | 106 | — | 188 | (4) | — | — | 294 | (4) | — | 294 | | Fund finance | 1 320 | (1) | 24 | — | — | — | 1 344 | (1) | 51 | 1 395 | | Other corporate and financial institutions and governments | 529 | (3) | 65 | (4) | 22 | (3) | 616 | (10) | 66 | 682 | | Small ticket asset finance | 1 325 | (9) | 211 | (5) | 39 | (13) | 1 575 | (27) | — | 1 575 | | Motor finance | 1 022 | (3) | 81 | (5) | 19 | (7) | 1 122 | (15) | — | 1 122 | | Aviation finance | 96 | — | 76 | (1) | — | — | 172 | (1) | 270 | 442 | | Energy and infrastructure finance | 534 | (2) | 69 | (3) | 35 | (4) | 638 | (9) | 22 | 660 | | Total corporate and other lending | 6 763 | (27) | 963 | (29) | 217 | (60) | 7 943 | (116) | 544 | 8 487 | | Coverage ratio | | 0.40% | | 3.0% | | 27.6% | | 1.5% | | | 260 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | The tables that follow provide further analysis of the Bank’s gross credit and counterparty exposures. Total gross credit and counterparty risk exposures do not take into consideration risk mitigating factors such as collateral, financial guarantees and instruments that create an economic hedge of credit and counterparty risk. An analysis of gross credit and counterparty exposures Gross credit and counterparty exposure totalled £ 31.1 billion at 31 March 2025 . Cash and near cash balances amounted to  £9.1  billion and are largely reflected in the following line items in the table below: cash and balances at central banks, loans and advances to banks and sovereign debt securities. These exposures are all Stage 1. There are immaterial Stage 2 and Stage 3 exposures outside of loans and advances to customers which are small relative to the balance sheet. Loans and advances to customers (including committed facilities) account for greater than 98% of overall ECLs. | | | --- | | | | An analysis of gross credit and counterparty exposures | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’million | 31 March 2025 | | 31 March 2024\* | | | Cash and balances at central banks | 4 192 | | 5 662 | | | Loans and advances to banks | 860 | | 676 | | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 641 | | 1 140 | | | Sovereign debt securities | 2 525 | | 1 928 | | | Bank debt securities | 324 | | 297 | | | Other debt securities | 772 | | 708 | | | Derivative financial instruments | 315 | | 353 | | | Securities arising from trading activities | 1 | | 13 | | | Loans and advances to customers | 16 956 | | 16 744 | | | Other loans and advances | 163 | | 146 | | | Other securitised assets | — | | 2 | | | Other assets | 28 | | 33 | | | Total on-balance sheet exposures | 27 777 | | 27 702 | | | Guarantees | 36 | | 34 | | | Committed facilities related to loans and advances to customers | 2 477 | | 2 327 | | | Contingent liabilities, letters of credit and other | 800 | | 513^ | | | Total off-balance sheet exposures | 3 313 | | 2 874 | | | Total gross credit and counterparty exposures | 31 090 | | 30 576 | | \*Restated as detailed on page 242. ^Includes the notional exposure to credit risk resulting from credit derivative instruments of £52 million which are newly included in prior year reporting. 261 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | --- | | | | A further analysis of gross credit and counterparty exposures | The table below indicates the asset class (on the face of the consolidated balance sheet) in which credit and counterparty exposures are reflected. Not all assets included in the balance sheet bear credit and counterparty risk. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | At 31 March 2025 | Total gross credit and counterparty exposure | of which FVPL | of which amortised cost and FVOCI | ECL | Assets that we deem to have no legal credit exposure | | Total assets | | | £’million | | | | Cash and balances at central banks | 4 192 | — | 4 192 | — | — | | 4 192 | | | Loans and advances to banks | 860 | — | 860 | — | — | | 860 | | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 641 | 56 | 1 585 | — | — | | 1 641 | | | Sovereign debt securities | 2 525 | — | 2 525 | — | — | | 2 525 | | | Bank debt securities | 324 | — | 324 | — | — | | 324 | | | Other debt securities | 772 | 50 | 722 | (1) | — | | 771 | | | Derivative financial instruments | 315 | 315 | — | — | 11 | | 326 | | | Securities arising from trading activities | 1 | 1 | — | — | 149 | | 150 | | | Loans and advances to customers | 16 956 | 572 | 16 384 | (142) | — | | 16 814 | | | Other loans and advances | 163 | — | 163 | — | — | | 163 | | | Other securitised assets | — | — | — | — | — | | — | | | Investment portfolio | — | — | — | — | 212\* | | 212 | | | Interest in associated undertakings and joint venture holdings | — | — | — | — | 832 | | 832 | | | Current taxation assets | — | — | — | — | 7 | | 7 | | | Deferred taxation assets | — | — | — | — | 121 | | 121 | | | Other assets | 28 | — | 28 | — | 649^ | | 677 | | | Property and equipment | — | — | — | — | 59 | | 59 | | | Goodwill | — | — | — | — | 57 | | 57 | | | Software | — | — | — | — | 5 | | 5 | | | Other acquired intangible assets | — | — | — | — | — | | — | | | Total on-balance sheet exposures | 27 777 | 994 | 26 783 | (143) | 2 100 | | 29 734 | | | Guarantees | 36 | — | 36 | — | — | | 36 | | | Committed facilities related to loans and advances to customers | 2 477 | 165 | 2 312 | (8) | — | | 2 469 | | | Contingent liabilities, letters of credit and other^^ | 800 | 349 | 451 | (2) | 139 | | 937 | | | Total off-balance sheet exposures | 3 313 | 514 | 2 799 | (10) | 139 | | 3 442 | | | Total exposures | 31 090 | 1 508 | 29 582 | (153) | 2 239 | | 33 176 | | \*Relates to exposures that are classified as investment risk. ^Other assets include settlement debtors which we deem to have no credit risk exposure as they are settled on a delivery against payment basis. ^^Includes the notional exposure to credit risk resulting from credit derivative instruments of £339 million. Note: The above numbers may not cast due to rounding. The table below summarises the ECL held against financial assets held at FVOCI, which is reported on the balance sheet within the fair value reserves and therefore not included in the table above. The ECL charges are recognised in ‘Expected credit loss impairment charges’ in the income statement. | | | | | | --- | --- | --- | --- | | | | | | | At 31 March 2025 | | | | | £’million | Fair value | ECL | | | Loans and advances to customers | 2 005 | (23) | | 262 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | --- | | | | A further analysis of gross credit and counterparty exposures (continued) | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | At 31 March 2024ˆˆ | Total gross credit and counterparty exposure | of which FVPL | of which amortised cost and FVOCI | ECL# | Assets that we deem to have no legal credit exposure | Total assets | | £’million | | Cash and balances at central banks | 5 662 | — | 5 662 | — | — | 5 662 | | Loans and advances to banks | 676 | — | 676 | — | — | 676 | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 140 | 164 | 976 | — | — | 1 140 | | Sovereign debt securities | 1 928 | — | 1 928 | — | — | 1 928 | | Bank debt securities | 297 | — | 297 | — | — | 297 | | Other debt securities | 708 | 59 | 649 | — | — | 708 | | Derivative financial instruments | 353 | 353 | — | — | 79 | 432 | | Securities arising from trading activities | 13 | 13 | — | — | 144 | 157 | | Loans and advances to customers | 16 744 | 641 | 16 103 | (187) | — | 16 557 | | Other loans and advances | 146 | — | 146 | — | — | 146 | | Other securitised assets | 2 | 2 | — | — | 65ˆ | 67 | | Investment portfolio | — | — | — | — | 244\* | 244 | | Interest in associated undertakings and joint venture holdings | — | — | — | — | 791 | 791 | | Current taxation assets | — | — | — | — | 13 | 13 | | Deferred taxation assets | — | — | — | — | 120 | 120 | | Other assets | 33 | — | 33 | — | 717\*\* | 750 | | Property and equipment | — | — | — | — | 73 | 73 | | Goodwill | — | — | — | — | 58 | 58 | | Software | — | — | — | — | 5 | 5 | | Other acquired intangible assets | — | — | — | — | — | — | | Total on-balance sheet exposures | 27 702 | 1 232 | 26 470 | (187) | 2 309 | 29 824 | | Guarantees | 34 | — | 34 | — | — | 34 | | Committed facilities related to loans and advances to customers | 2 327 | 102 | 2 225 | (8) | — | 2 319 | | Contingent liabilities, letters of credit and other## | 513 | 79 | 434 | (3) | 112 | 622 | | Total off-balance sheet exposures | 2 874 | 181 | 2 693 | (11) | 112 | 2 975 | | Total exposures | 30 576 | 1 413 | 29 163 | (198) | 2 421 | 32 799 | #ECLs include £13.4 million ECL held against financial assets held at FVOCI. \*Relates to exposures that are classified as investment risk. ^While the Bank manages all risks (including credit risk) from a day-to-day operational perspective, certain assets are within special purpose vehicles that ring-fence the assets to specific credit providers and limit security to the assets in the vehicle. This balance reflects the credit exposure to credit providers external to the Bank. The credit exposure that the Bank has in the vehicles is reflected in the ‘total gross credit and counterparty exposure’ for other securitised assets. \*\*Other assets include settlement debtors which we deem to have no credit risk exposure as they are settled on a delivery against payment basis. ##Includes the notional exposure to credit risk resulting from credit derivative instruments of £52 million which are newly included in prior year reporting. ^^Restated as detailed on page 242. 263 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Unaudited_information.png | Gross credit and counterparty exposures by residual contractual maturity | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | At 31 March 2025 | Up to three months | Three to six months | Six months to one year | One to five years | Five to 10 years | >10 years | Total | | | £’million | | | Cash and balances at central banks | 4 192 | — | — | — | — | — | 4 192 | | | Loans and advances to banks | 860 | — | — | — | — | — | 860 | | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 319 | 272 | 50 | — | — | — | 1 641 | | | Sovereign debt securities | 945 | 944 | 133 | 462 | 41 | — | 2 525 | | | Bank debt securities | 3 | — | 14 | 307 | — | — | 324 | | | Other debt securities | 9 | 4 | 7 | 51 | 248 | 453 | 772 | | | Derivative financial instruments | 107 | 35 | 74 | 93 | 1 | 5 | 315 | | | Securities arising from trading activities | 1 | — | — | — | — | — | 1 | | | Loans and advances to customers | 1 497 | 1 291 | 1 972 | 8 934 | 1 744 | 1 518 | 16 956 | | | Other loans and advances | 2 | — | — | 48 | 89 | 24 | 163 | | | Other securitised assets | — | — | — | — | — | — | — | | | Other assets | 28 | — | — | — | — | — | 28 | | | Total on-balance sheet exposures | 8 963 | 2 546 | 2 250 | 9 895 | 2 123 | 2 000 | 27 777 | | | Guarantees | 15 | — | 18 | 3 | — | — | 36 | | | Committed facilities related to loans and advances to customers | 128 | 95 | 315 | 1 591 | 334 | 14 | 2 477 | | | Contingent liabilities, letters of credit and other | 406 | 15 | 55 | 318 | 6 | — | 800 | | | Total off-balance sheet exposures | 549 | 110 | 388 | 1 912 | 340 | 14 | 3 313 | | | Total gross credit and counterparty exposures | 9 512 | 2 656 | 2 638 | 11 807 | 2 463 | 2 014 | 31 090 | | 264 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Unaudited_information.svg | Gross credit and counterparty exposures by industry | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | High net worth and other professional individuals | Lending collateralised by property | Agriculture | Electricity, gas and water (utility services) | Public and non- business services | Business services | Finance and insurance | | £’million | | At 31 March 2025 | | | | | | | | | Cash and balances at central banks | — | — | — | — | 4 192 | — | — | | Loans and advances to banks | — | — | — | — | — | — | 860 | | Reverse repurchase agreements and cash collateral on securities borrowed | — | — | — | — | — | — | 1 641 | | Sovereign debt securities | — | — | — | — | 2 366 | — | 159 | | Bank debt securities | — | — | — | — | — | — | 324 | | Other debt securities | — | — | — | — | 2 | 15 | 689 | | Derivative financial instruments | — | 2 | 1 | 10 | 1 | 16 | 243 | | Securities arising from trading activities | — | — | — | — | — | — | 1 | | Loans and advances to customers | 5 861 | 2 366 | 20 | 849 | 288 | 911 | 2 457 | | Other loans and advances | — | — | — | — | — | — | 163 | | Other securitised assets | — | — | — | — | — | — | — | | Other assets | — | — | — | — | — | — | 26 | | Total on-balance sheet exposures | 5 861 | 2 368 | 21 | 859 | 6 849 | 942 | 6 563 | | Guarantees | 14 | — | — | — | — | — | — | | Committed facilities related to loans and advances to customers | 226 | 371 | — | 493 | 47 | 94 | 762 | | Contingent liabilities, letters of credit and other | 39 | — | — | 237 | — | — | 484 | | Total off-balance sheet exposures | 279 | 371 | — | 730 | 47 | 94 | 1 246 | | Total gross credit and counterparty exposures | 6 140 | 2 739 | 21 | 1 589 | 6 896 | 1 036 | 7 809 | | At 31 March 2024# | | | | | | | | | Cash and balances at central banks | — | — | — | — | 5 662 | — | — | | Loans and advances to banks | — | — | — | — | — | — | 676 | | Reverse repurchase agreements and cash collateral on securities borrowed | — | — | — | — | 131 | — | 1 009 | | Sovereign debt securities | — | — | — | — | 1 902 | — | 26 | | Bank debt securities | — | — | — | — | — | — | 297 | | Other debt securities | — | — | — | — | 3 | 24 | 596 | | Derivative financial instruments | — | 1 | 1 | 7 | 1 | 2 | 315 | | Securities arising from trading activities | — | — | — | — | — | — | 13 | | Loans and advances to customers | 5 736 | 2 521 | 19 | 790 | 234 | 734 | 2 767 | | Other loans and advances | — | — | — | — | — | — | 146 | | Other securitised assets | — | — | — | — | — | — | — | | Other assets | 5 | — | — | — | — | — | 27 | | Total on-balance sheet exposures | 5 741 | 2 522 | 20 | 797 | 7 933 | 760 | 5 872 | | Guarantees | 12 | — | — | — | — | — | — | | Committed facilities related to loans and advances to customers | 215 | 300 | — | 433 | 62 | 76 | 929 | | Contingent liabilities, letters of credit and other^ | 39 | — | — | 268 | — | 3 | 187 | | Total off-balance sheet exposures | 266 | 300 | — | 701 | 62 | 79 | 1 116 | | Total gross credit and counterparty exposures | 6 007 | 2 822 | 20 | 1 498 | 7 995 | 839\* | 6 988\* | #Includes a reclassification of exposures totalling £532 million from business services to finance and insurance. ^Includes the notional exposure to credit risk resulting from credit derivative instruments of £52 million which are newly included in prior year reporting. #Restated as detailed on page 242. 265 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | Retailers and wholesalers | Manufacturing and commerce | Construction | Other residential mortgages | Corporate commercial real estate | Mining and resources | Leisure, entertainment and tourism | Transport | Motor finance | Com- munication | Total | | | | | | | | | | | | | | | | | | | | | | | | | | — | — | — | — | — | — | — | — | — | — | 4 192 | | — | — | — | — | — | — | — | — | — | — | 860 | | — | — | — | — | — | — | — | — | — | — | 1 641 | | — | — | — | — | — | — | — | — | — | — | 2 525 | | — | — | — | — | — | — | — | — | — | — | 324 | | — | — | — | 39 | — | — | — | 27 | — | — | 772 | | 10 | 10 | 1 | — | 1 | — | — | 15 | — | 5 | 315 | | — | — | — | — | — | — | — | — | — | — | 1 | | 290 | 829 | 159 | — | 121 | 4 | 109 | 890 | 1 119 | 683 | 16 956 | | — | — | — | — | — | — | — | — | — | — | 163 | | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | 2 | 28 | | 300 | 839 | 160 | 39 | 122 | 4 | 109 | 932 | 1 119 | 690 | 27 777 | | — | — | — | — | 3 | — | — | 19 | — | — | 36 | | 15 | 194 | 1 | — | 8 | — | 2 | 97 | — | 167 | 2 477 | | — | 39 | — | — | — | — | — | 1 | — | — | 800 | | 15 | 233 | 1 | — | 11 | — | 2 | 117 | — | 167 | 3 313 | | 315 | 1 072 | 161 | 39 | 133 | 4 | 111 | 1 049 | 1 119 | 857 | 31 090 | | | | | | | | | | | | | | — | — | — | — | — | — | — | — | — | — | 5 662 | | — | — | — | — | — | — | — | — | — | — | 676 | | — | — | — | — | — | — | — | — | — | — | 1 140 | | — | — | — | — | — | — | — | — | — | — | 1 928 | | — | — | — | — | — | — | — | — | — | — | 297 | | — | — | — | 51 | — | — | — | 34 | — | — | 708 | | 6 | 12 | — | — | 1 | — | — | 6 | — | 1 | 353 | | — | — | — | — | — | — | — | — | — | — | 13 | | 246 | 860 | 143 | — | 120 | 36 | 87 | 811 | 1 122 | 518 | 16 744 | | — | — | — | — | — | — | — | — | — | — | 146 | | — | — | — | 2 | — | — | — | — | — | — | 2 | | 1 | — | — | — | — | — | — | — | — | — | 33 | | 253 | 872 | 143 | 53 | 121 | 36 | 87 | 851 | 1 122 | 519 | 27 702 | | — | — | — | — | 3 | — | — | 19 | — | — | 34 | | 12 | 135 | 1 | — | 7 | — | 3 | 30 | — | 124 | 2 327 | | — | 14 | — | — | — | — | — | 2 | — | — | 513 | | 12 | 149 | 1 | — | 10 | — | 3 | 51 | — | 124 | 2 874 | | 265 | 1 021 | 144 | 53 | 131 | 36 | 90 | 902 | 1 122 | 643 | 30 576 | 266 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | 60. #### Additional credit and counterparty risk #### information Credit risk classification and provisioning policy IFRS 9 requirements have been embedded into our Bank credit risk classification and provisioning policy. A framework has been established to incorporate both quantitative and qualitative measures. | | | | --- | --- | | | | | Page_references.svg | For further detail on our credit risk classification and provision policy please refer to pages [133](#i7e3e178259884a948abc3d325fbe8a20_42819) and [134](#i7e3e178259884a948abc3d325fbe8a20_42781) . | Internal credit rating models and ECL methodology Internal credit rating models cover all material asset classes. These internal credit rating models are also used for IFRS 9 modelling after adjusting for key differences. Internal credit models calculate through the economic cycle losses whereas IFRS 9 requires 12-month or lifetime point-in-time losses based on conditions at the reporting date and multiple economic scenario forecasts of the future conditions over the expected lives. | | | | --- | --- | | | | | Page_references.png | Further information on internal credit ratings is provided on page  [255](#i9eca2b11a6aa469397bec54927e3550a_0-0-1-1-2494133) . | | | | | --- | --- | | | | | Unaudited_information.svg | Key judgements | The measurement of ECL has reliance on expert credit judgement. Key judgemental areas are highlighted below and are subject to robust governance processes. Key drivers of measurement uncertainty include: • The assessment of a significant increase in credit risk • A range of forward-looking probability weighted macro- economic scenarios • Estimations of probabilities of default, loss given default and exposures at default using models. | | | | --- | --- | | | | | Page_references.png | For further detail on our process for determining ECL please refer to page [134](#i7e3e178259884a948abc3d325fbe8a20_42781) . | Key judgements at 31 March 2025 Key judgemental areas under IFRS 9 are subject to robust governance processes. At 31 March 2025, the composition and weightings of the forward-looking macro-economic scenarios were revised to reflect the current pressures in the macro- economic environment, however there remains reliance on expert credit judgements to ensure that the overall level of ECL is reasonable. We continue to hold a management overlay of £3.7 million at 31 March 2025 (31 March 2024: £3.7 million) which captures the uncertainty that remains in the model’s predictive capability. The overlay is apportioned to Stage 2 assets. Macro-economic sensitivities Changes in macro-economic scenarios and weightings may result in the volatility of provisions, particularly to Stage 1 and 2 assets. Sensitivities to macro-economic scenarios and factors form part of our overall risk monitoring, in particular the Bank’s potential ECLs if each scenario were given a 100% weighting. In these instances all non-modelled ECLs, including credit assessed ECLs and other management judgements remain unchanged. The total reported ECL at 31 March 2025 amounted to £176 million (31 March 2024: £198 million). The table below summarises the variance from reported ECL should the base case and two downside cases be weighted by 100%. Whilst the outputs from these 100% weighted scenarios are consistent with the macro-economic factor inputs set out in the context of each scenario, in practice the outcome could differ due to management actions or other key judgements applied. | | | | --- | --- | | | | | At 31 March 2025 | Change in reported ECL | | £’million | | Base case (100%) | 9.1 | | Downside 1 – trade war (100%) | (26.5) | | Downside 2 – global synchronised downturn (100%) | (16.8) | | | | | --- | --- | | | | | At 31 March 2024 | Change in reported ECL | | £’million | | Base case (100%) | 5.7 | | Downside 1 – inflation (100%) | (4.9) | | Downside 2 – global stress (100%) | (22.0) | 267 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | --- | | | | Forward-looking macro-economic scenarios | The measurement of ECL also requires the use of multiple economic scenarios to calculate a probability weighted forward–looking estimate. These scenarios are updated at least twice a year, or more frequently if there is a macro–economic shock or significant shift in expectations. The weighting of these scenarios for IFRS 9 as well as the scenarios themselves are discussed and presented at the relevant BRCCs as well as the relevant capital committees for approval, which form part of the principal governance framework for macro–economic scenarios. They are also approved by the relevant Audit Committees. A number of forecast economic scenarios are considered for capital planning, stress testing (including Investec-specific stress scenarios) and IFRS 9 ECL measurement. For IBP, four macro–economic scenarios were used in the measurement of ECL. These scenarios incorporate a base case, an upside case and two downside cases. As part of the annual scenario review and in light of the current macro–economic environment, the composition of the downside scenarios have been adjusted to incorporate downside 1 – trade war scenario which replaces the downside 1 – inflation scenario that was used at 31 March 2024. The downside 2 – global stress (cautious easing, severe recession scenario), has also been replaced, in this case with the downside 2 – global synchronised downturn scenario. This is designed as a severe economic shock to act as a proxy for a variety of unforeseen tail risks. In addition to the assessment of the macro-economic scenarios, weightings are also reviewed taking into account the latest economic developments and the associated risks to the outlook. In light of recent global events, emphasis was placed on the downside 1 – trade war scenario which was allocated a 20% weighting, the downside 2 – global synchronised downturn scenario was given a 10% weight, whilst the base case and upside case were judged at 60% and 10% respectively. The risks to economic activity remain skewed to the downside, with the weightings calibrated to consider the risk of an escalated global trade war and the ramifications for inflation, monetary policy and activity. The risk of an unanticipated global demand shock is taken into account with downside 2 – global synchronised downturn scenario. The base case envisages a recovery in the UK economy following the stagnation seen in the second half of 2024. This is driven by a solid pace of household disposable income growth and lower interest rates, whilst a strengthening in investment is expected to provide support in the medium–term. Over the five– year horizon, annual gross domestic product (GDP) growth is expected to average 1.6%, whilst UK consumer price index (CPI) inflation is assumed to remain on a path to the 2% target, allowing for a further easing in monetary policy. The Bank rate is assumed to reach 3.75% by the end of 2025 and 3% in 2026. The global outlook is in keeping with the UK, in that GDP growth is expected to strengthen, inflation to moderate and policy rates to be lowered further. The Euro area is expected to see a GDP growth average of 1.3%. The US economy is assumed to see a modest slowdown near-term given still restrictive policy rates and negative effects from tariffs. Across the medium–term, GDP growth is expected to strengthen and average at 1.9%. Downside 1 – trade war scenario, assumes an escalated global trade war, initially triggered by a US 20% universal tariff and a 100% tariff on China. Retaliatory measures see further levies applied. Inflation rises, monetary policy remains more restrictive, confidence falls sharply, investment is curtailed and credit conditions tighten. In a UK context, CPI inflation rises to 4.7%, bank rate rises to 5.50% and the economy contracts by 3%. The combination of higher inflation and interest rates prompts more severe affordability issues for households and corporates. A recovery is envisaged over the later part of the scenario horizon, but across the whole five–year period, annual UK GDP growth averages 0.4%. Downside 2 – global synchronised downturn scenario, a severe hypothetical scenario designed as a proxy for economic tail risks. The scenario assumes a deep global economic downturn, of a similar severity as the 2008/2009 global financial crisis. The broad context is a significant global demand shock in the first year of the scenario, prompting a sharp repricing in assets, tightening financial conditions and a material downturn in economic activity where UK GDP falls 4.1%. Central banks are assumed to undertake aggressive monetary policy easing in response. In the UK, the BoE is expected to cut the bank rate to 0.75%. Similarly severe recessions are seen in other key jurisdictions; Euro area GDP falls 4.7% and the US 4.2%. In the upside case, economic activity proves more resilient, and the pace of recovery more robust as stronger confidence and lower interest rates prompt a pickup in investment. Ultimately, through the scenario horizon productivity growth is expected to support stronger levels of economic growth. Accordingly medium–term GDP growth averages 2% per annum. The relatively swift rebound in activity is experienced globally, and monetary policy normalises gradually enough so as to not subdue growth. The graph below shows the forecasted UK GDP under each macro–economic scenario applied at 31 March 2025. UK GDP Forecast | | | | --- | --- | | | | | | £’billion | ![57]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Upside | | | Base case | | | | | | | Downside 1 – trade war | | | Downside 2 – global synchronised downturn | | | | | 268 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | The table that follows shows the key factors that form part of the UK and Other macro–economic scenarios and their relative applied weightings. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | At 31 March 2025 average 2025 – 2030 | | | | At 31 March 2024 average 2024 – 2029 | | | | | Macro-economic scenarios | Upside | Base case | Downside 1 trade war | Downside 2 global synchronised downturn | Upside | Base case | Downside 1 inflation | Downside 2 global stress | | % | % | % | % | % | % | % | % | | UK | | | | | | | | | | GDP growth | 2.1 | 1.7 | 0.4 | 0.4 | 1.9 | 1.6 | (0.1) | 0.2 | | Unemployment rate | 4.1 | 4.7 | 6.7 | 6.8 | 3.5 | 4.4 | 5.5 | 6.5 | | CPI inflation | 2.0 | 2.1 | 2.7 | 1.6 | 1.9 | 2.0 | 4.1 | 2.4 | | House price growth | 3.6 | 2.9 | (2.3) | (0.9) | 3.0 | 2.5 | (0.6) | (1.6) | | BoE – Bank rate (end year) | 3.0 | 3.1 | 3.9 | 1.7 | 3.1 | 3.2 | 5.4 | 2.5 | | Euro area | | | | | | | | | | GDP growth | 2.0 | 1.3 | 0.3 | 0.2 | 1.9 | 1.5 | 0.4 | 0.3 | | US | | | | | | | | | | GDP growth | 2.4 | 1.9 | 0.6 | 0.6 | 2.5 | 1.9 | 0.7 | 0.8 | | Scenario weightings | 10 | 60 | 20 | 10 | 10 | 60 | 15 | 15 | The following table shows annual averages of economic factors for the base case over a five-year period based on the economic forecasts in place as at 31 March 2025. | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Base case % | Financial years | | | | | | 2025/2026 | 2026/2027 | 2027/2028 | 2028/2029 | 2029/2030 | | UK | | | | | | | GDP growth | 1.0 | 1.7 | 1.8 | 1.8 | 1.9 | | Unemployment rate | 4.9 | 5.0 | 4.7 | 4.5 | 4.5 | | CPI inflation | 2.6 | 2.1 | 2.0 | 2.0 | 2.0 | | House price growth | 4.2 | 3.1 | 2.5 | 2.4 | 2.4 | | BoE – Bank rate (end year) | 3.5 | 3.0 | 3.0 | 3.0 | 3.0 | | Euro area | | | | | | | GDP growth | 1.1 | 1.3 | 1.4 | 1.4 | 1.4 | | US | | | | | | | GDP growth | 1.5 | 1.7 | 2.1 | 2.0 | 2.0 | The following table outlines the extreme point forecast for each economic factor across the scenarios as at 31 March 2025. Baseline represents the five–year base case average. Upside scenario values represent the best outcomes, namely the highest quarterly level of GDP, house price growth (year on year), lowest level of unemployment and Bank rate. Upside scenario value for CPI inflation is represented by the five–year average. Downside scenario values represent the worst outcomes being lowest quarterly level of GDP, house price growth (year on year). For Bank rate and CPI inflation the most extreme point is listed, the highest level reflective in downside 1 – trade war scenario and the lowest in downside 2 – global synchronised downturn scenario. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Five-year extreme points At 31 March 2025 | Upside | Baseline: Base case five-year average | Downside 1 trade war | Downside 2 global synchronised downturn | | % | % | % | % | | UK | | | | | | GDP growth | 2.9 | 1.7 | (3.0) | (4.1) | | Unemployment rate | 3.8 | 4.7 | 8.5 | 8.0 | | CPI inflation | 2.0 | 2.1 | 4.7 | 0.8 | | House price growth | 5.7 | 2.9 | (25.5) | (18.0) | | BoE – Bank rate (end year) | 3.0 | 3.1 | 5.5 | 0.8 | | Euro area | | | | | | GDP growth | 2.2 | 1.3 | (3.4) | (4.7) | | US | | | | | | GDP growth | 2.6 | 1.9 | (4.0) | (4.2) | 269 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | | --- | --- | --- | | | | | | Unaudited_information.svg | Integrating_sustainability.svg | | | 61. Sustainability risk | | | Investec’s sustainability strategy aligns with a selection of United Nations Sustainable Development Goals (SDGs), providing a solid framework to assess, align, and prioritise activities. Two SDGs are fundamental to Investec: Reduced inequalities (SDG 10), and Climate action (SDG 13), with a further six SDGs core to our sustainability strategy: • Quality education (SDG 4) • Clean water and sanitation (SDG 6) • Affordable and clean energy (SDG 7) • Decent work and economic growth (SDG 8) • Industry innovation and infrastructure (SDG 9) • Sustainable cities and communities (SDG 11). Risk governance structure The Investec Group’s DLC Executive Sustainability Committee, mandated by the Investec Group’s executive directors, reports relevant matters to the DLC SEC and Investec Group ERC. The main objectives of the committee are to align and integrate sustainability activities across the organisation while focusing on business opportunities across Investec’s priority SDGs and escalating significant matters for consideration. The committee provides feedback to the DLC SEC on current and emerging sustainability matters and identifies relevant external factors that could negatively impact the organisation's reputation, while also considering Investec’s impact on people and planet, reflecting a double materiality perspective. Risk management We integrate sustainability considerations into our daily operations and credit and investment decision-making processes, and we adopt a precautionary approach to managing sustainability risks within our decision-making frameworks. We encourage our clients to adopt and adhere to best practices and standards regarding sustainability matters, as well as to report on their sustainability performance and impact where appropriate. Additionally, our due diligence processes are embedded in our operations, with transparency maintained via disclosures to our stakeholders and regulators. We believe that one of the most significant socio-economic and environmental impacts we can achieve is through partnering with our clients and stakeholders to foster a cleaner, more resilient, and inclusive world. We use various tools and frameworks to assess the sustainability performance and impact of our clients and transactions, including the Equator Principles, Partnership for Carbon Accounting Financials (PCAF), the UN Global Compact, the UN Guiding Principles on Business and Human Rights, and the OECD Guidelines for Multinational Enterprises. Our strategy for managing and measuring sustainability risk is ultimately informed by our consideration of Investec’s priority SDGs. Reduced inequalities (SDG 10) The Bank is dedicated to addressing reduced inequalities within our operations, communities, and business activities. We recognise the importance of fostering an inclusive environment that promotes equal opportunities for all individuals. Within our own operations The Bank is dedicated to cultivating a purposeful and inclusive culture, which we achieve through our workplace environment and the Investec experience. Furthermore, we recognise that no single business can address the myriad socio-economic needs present in society. Therefore, our focus is directed towards education and learnerships, entrepreneurship and job creation, environmental sustainability, and philanthropy. In principle, we are committed to: • Encouraging a sense of belonging for all people, irrespective of difference • Focusing on creating education and learnership opportunities within our communities • Creating jobs for young people through quality work experience placements. At 31 March 2025 we had 40% representation of women and 30% ethnic diversity, as defined by the UK listing rule, on the IBP Board. We continue to improve our gender pay gap in the UK, with a mean hourly pay gap of 20.5%, and we voluntarily disclose our ethnicity pay gap. Our community initiatives form the cornerstone of our commitment to creating enduring worth, reinforcing our overarching goal of fostering corporate responsibility. We are currently in the process of developing a comprehensive social impact strategy and framework to consolidate and enhance our community initiatives. Within our lending and investment activities We support a number of internationally recognised principles, guidelines and voluntary standards which reflect our commitment to respecting human rights, building inclusive communities, and supporting activities that reduce inequalities. Investec prioritises the development of the mid-market sector, a crucial driver of job creation and economic growth. The Investec Group’s Sustainable and Transition Finance Classification Framework and associated target drive financing for commercial activities that support social outcomes (as well as environmental outcomes), most of which are in pursuit of reducing inequalities. In principle, we will not engage in activities: • that do not respect human rights and the rights of local communities and indigenous peoples • that are in non-compliance with minimum standards for occupational health and safety and the relevant local legislation. 270 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Investec places significant importance on addressing modern slavery according to the UK Modern Slavery Act 2015. This extends to screening third parties' modern slavery policies at the time of onboarding. The considerations outlined above are integrated into the sustainability screening processes applied across our business activities. Transactions are classified as high, medium, or low risk in accordance with the European Bank for Reconstruction and Development (EBRD) classification using the International Finance Corporation (IFC) guidelines. Those identified in high- risk industries undergo a comprehensive screening process conducted by the Group Sustainability team. The assessment of a transaction’s social impact may include evaluating policies related to human rights, health and safety, and modern slavery, as well as adherence to Minimum Social Safeguards. Climate action (SDG 13) Our environmental policy and climate change statement reflect our commitment to achieving a net-zero carbon economy by 2050. In addition, our biodiversity statement reinforces our dedication to safeguarding the natural environment. We acknowledge the interconnectedness of climate change and biodiversity loss, as well as the exposure of our business and operational activities to various climate and nature-related risks. The Investec Group positively impacts biodiversity through environmental philanthropy activities and reduces negative effects by addressing financial crimes related to illegal wildlife trade. In principle: • We are committed to integrating climate change and nature- related risk considerations into our day-to-day operations and into our lending and investment decisions • There are several Investec Group environmental policies that guide credit decision-making from a sustainability perspective • We support the key provisions of the Equator Principles (EP). All transactions in non-designated countries are EP monitored and compliant • We will not engage in activities that negatively impact conservation areas or have an irreversible negative impact on the environment, indigenous people or natural assets. Climate risk, a key component of sustainability risk, is becoming increasingly material for banks. In our assessments of the impact of climate change on our business, we consider both physical risks and transition risks. While we continue to integrate climate risk considerations into our risk management frameworks, we also recognise the commercial opportunities that climate action presents. Our approach to net-zero We support the Paris Agreement aims of holding the increase in global average temperature to well below 2°C above pre- industrial levels and continue to pursue efforts towards limiting it to 1.5°C Investec’s pathway to net-zero comprises three channels of impact: • Meeting our fossil fuel exposure commitments • Driving sustainable and transition finance activities • Influencing and advocating for our clients and suppliers to effectively pursue decarbonisation. Within our own operations We embrace our responsibility to understand and manage our carbon footprint. We have upheld our commitment to carbon neutrality in our direct operational emissions for the seventh consecutive financial year by sourcing 100% of our Scope 2 energy consumption from renewable energy sources through the purchase of Renewable Energy Certificates. We have offset the remaining unavoidable residual emissions of 91% at 31 March 2025 (31 March 2024: 89%) by acquiring verified, high-quality carbon credits. Climate risk assessments are conducted in accordance with the requirements of the BoE. Within our lending and investment activities We acknowledge that one of the widest and most impactful influences we can have on the environment is to manage and reduce the carbon emissions associated with our business activities, particularly within our lending and investment portfolios (Scope 3 financed activities). As such, we continue to work with the PCAF to measure our financed emissions and are actively enhancing data collection efforts and refining assumptions for the Scope 3 emissions calculations. As part of the sustainability screening process, the assessment of a transaction’s environmental impact may include evaluating policies related to the environment, waste management, and rehabilitation, as well as environmental impact assessments. Climate and nature-related financial disclosures In our ongoing commitment to transparency and sustainability, we continue to publish a separate climate and nature-related report while we await the implementation of IFRS S1 and IFRS S2 in our jurisdictions. This approach ensures alignment with best practices in climate-related financial disclosures and provides our stakeholders with pertinent information regarding climate risks and opportunities. We are dedicated to enhancing our reporting framework and look forward to integrating these new standards into our compliance processes as they take effect. In addition to our climate reporting, we started incorporating certain recommendations from the Taskforce on Nature-related Financial Disclosures (TNFD). While this integration is still a work in progress and not yet fully embedded, we recognise the importance of addressing nature- related risks and opportunities as part of our commitment to sustainability. | | | | --- | --- | | | | | Website.svg | Refer to detailed information in the Investec Group’s 2025 climate and nature-related disclosures which are published and available on our website: | 271 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Sustainability risk positioning and integration | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Governance | Strategy | Risk management | Metrics | | Achievements in prior years | • Established an Investec Group DLC Executive Sustainability Committee to align and monitor the Investec Group’s sustainability activities • Engaged with stakeholders through conducting a double materiality assessment • Four members of the Investec Group Executive Team, including the Investec Group CE, completed external sustainability training • Activated a focused learning pathway for management and employees, targeted towards their unique requirements within their respective areas. | • Acknowledged the Paris Agreement’s aim of holding the increase in the global average temperature to well below 2°C compared to pre- industrial levels and of pursuing efforts towards limiting it to 1.5°C • Supported the Partnership for Biodiversity Accounting Financials (PBAF) • Enhanced our sustainable finance framework to include transition and social finance. | • Strengthened our climate focus in the IBP risk appetite assessment resulting in a net- zero aligned target set towards zero coal exposure by 31 March 2027 • Reviewed and updated our fossil fuel policy with a commitment to no new financing for oil and gas exploration, extraction or production projects directly, regardless of jurisdiction, from 1 January 2035 • Identified and disclosed material sustainability-related matters as a result of our double materiality assessment. | • Achieved carbon neutrality across our direct operational activities • Joined PCAF and measured our Scope 3 emissions within our lending and investing activities • Assessed net-zero pathways according to Science Based Targets Initiative (SBTi) guidance • Engaged with SBTi on their recommendations for Financial Institutions with the aim of setting verified climate-related targets • Automated our Scope 3 financed emission calculations. | | Achievements for the financial year ended March 2025 | • At Board level, evaluated and reaffirmed our commitment to the aims of the Net-Zero Banking Alliance (NZBA) • Linked Investec Group executive remuneration to the Investec Group’s inaugural sustainable and transition finance target • Hosted a Director’s Development session on topical sustainability matters • Established a governance process around the Scope 3 financed emissions results within the business and risk teams • Complied with the Corporate Sustainability Reporting Directive (CSRD) requirements. | • Focused on shifting our commercial strategy to drive more sustainable and transition finance activities • Incorporated into the annual budget process the determination of IBP business unit contributions to the Investec Group’s sustainable and transition finance target • Hosted a town hall for all colleagues, titled ‘Sustainable finance: an opportunity for growth’. | • Incorporated into the annual risk appetite review process the consideration of business activities eligible for the Investec Group’s sustainable and transition finance target • Conducted climate risk assessments in accordance with the requirements of the BoE • Achieved our commitment to eliminate coal exposure from the IBP loan book in September 2024, more than two years ahead of schedule. | • Developed and announced the Investec Group’s inaugural sustainable and transition finance target, including IBP’s contribution • Continued to enhance our data collection processes and refine our assumptions for our Scope 3 financed emission calculations • Expanded our Scope 3 financed emissions coverage for energy lending, beyond power generation. | | Looking forward | • Increase focus on sustainability matters in the IBP BRCC, as well as in management forums across the Bank • Incorporate sustainability disclosure requirements from emerging regulations when applicable (including IFRS S1, S2) • Continue to strengthen the Investec Group’s sustainability and climate-related disclosures. | • Grow our provision of sustainable products and solutions within our client ecosystem • Support transition finance within our high-emitting client ecosystem where applicable • Actively engage with our clients and suppliers to promote decarbonisation and broader sustainability agendas • Develop a client engagement strategy that supports our transition plan • Understand and assess our impacts and dependencies on biodiversity • Continue to embed the assessment of climate-related matters into business strategy. | • Enhance screening on biodiversity and nature- related risks according to the TNFD recommendations • Embed monitoring and managing of Scope 3 emissions within the risk management process across our business • Establish a transition plan and set decarbonisation targets. | • Track clients who publicly disclose their net-zero pathways to achieve a clear aggregated downward trend of emissions towards net-zero by 2050 • Work with business teams to set appropriate emission reduction targets for our transition plan • Measure, monitor, and report progress against sustainable and transition finance targets. | 272 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Unaudited_information.svg | 62. Investment risk | Overview Investment risk in the banking book comprised 1.0% of total assets at 31 March 2025 . We have refocused our principal investment activities on clients where we have and can build a broader relationship through other areas of activity in the Bank. We partner with clients and other co-investors by bringing capital raising expertise, working capital management, merger and acquisition and investment experience into client-driven private equity transactions as well as leveraging third party capital into the Investec Group’s funds that are relevant to the Bank’s client base. Investments are selected based on: • Track record and credibility of management • Attractiveness of the industry and the positioning therein • Valuation/pricing fundamentals • Sustainability analyses • Exit possibilities and timing thereof • Ability to build value by implementing an agreed strategy. Investments in listed shares may arise on an IPO, or sale of an investment to a listed company. There is limited appetite for listed investments. Additionally, from time to time, the manner in which certain lending transactions are structured results in equity, warrants or profit shares being held, predominantly in unlisted companies. We also source development, investment and trading opportunities to create value within agreed risk parameters. Risk management As investment risk arises from a variety of activities conducted by the Bank, the monitoring and measurement thereof varies across transactions and/or type of activity. Investment committees exist in the UK which provide oversight of the regions where we assume investment risk. Risk appetite limits and targets are set to manage our exposure to investment risk. An assessment of exposures against limits and targets as well as stress testing scenario analyses are performed and reported to IBP BRCC. As a matter of course, concentration risk is avoided and investments are spread across geographies and industries. Valuation and sensitivity assumptions and accounting methodologies | | | | --- | --- | | | | | Page_references.svg | For a description of our valuation principles and methodologies refer to pages [135](#i7e3e178259884a948abc3d325fbe8a20_42793) to [139](#i7e3e178259884a948abc3d325fbe8a20_42807) and pages [170](#i447e4d363cd344738300acdd42f0e3a0_331) to  [183](#i23e6b9775da145deb279338375bf4dbf_3788) for factors and sensitivities taken into consideration in determining fair value. | | | | | --- | --- | | | | | Page_references.svg | An analysis of income and revaluations of these investments can be found in the investment income note on page [147](#i447e4d363cd344738300acdd42f0e3a0_295) . | | | | | | --- | --- | --- | | | | | | Analysis of investments £’million | On-balance sheet value of investments 31 March 2025 | On-balance sheet value of investments 31 March 2024 | | Unlisted investments | 211 | 243 | | Listed equities | 1 | 1 | | Total investment portfolio | 212 | 244 | | Trading properties | 85 | 63 | | Warrants and profit shares | 4 | 4 | | Total | 301 | 311 | Note: IW&I UK was previously 100% consolidated in IBP. IBP’s investment in Rathbones will be equity accounted for on a statutory basis and recognised as an associate. We do not include the investment in Rathbones Group plc as a part of the above analysis due to the nature of this strategic transaction. An analysis of investment portfolio, warrants and profit shares | | | --- | | | | 31 March 2025 | | £216 million | ![2474]() | | | | | --- | --- | --- | | | | | | | Finance and insurance | 56.7% | | | Transport | 10.7% | | | Retailers and wholesalers | 9.8% | | | Electricity, gas and water (utility services) | 6.6% | | | Other | 6.4% | | | Business services | 4.1% | | | Real estate | 3.1% | | | Leisure, entertainment and tourism | 2.6% | 273 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Unaudited_information.svg | 63. Securitisation/structured credit activities exposures | Overview The Bank’s definition of securitisation/structured credit activities is wider than the definition applied for regulatory capital purposes. The regulatory capital definition focuses largely on positions we hold in an investor capacity and includes securitisation positions we have retained in transactions in which the Bank has achieved significant risk transfer. We believe, however, that the information provided below is meaningful in that it groups all these related activities in order for a reviewer to obtain a full picture of the activities that we have conducted in this space. Some of the information provided below overlaps with the Bank’s credit and counterparty exposure information. In the UK, capital requirements for securitisation positions are calculated using either the standardised approach (SEC-SA) or the external ratings-based approach (SEC-ERBA). Given risk- weightings under the SEC-SA approach do not rely on external ratings, an analysis by risk-weightings has been provided below. Securitisation transactions provide the Bank with a cost effective, alternative source of financing either through sale to the market or through use of the notes issued as collateral for other funding mechanisms. We hold rated structured credit instruments. These are UK, US and European exposures and amounted to £813 million at 31 March 2025 (31 March 2024: £703 million) all of which are AAA and AA rated. | | | | --- | --- | | | | | Page_references.svg | For accounting methodologies, refer to page [135](#i7e3e178259884a948abc3d325fbe8a20_42782) . | Risk management All existing or proposed exposures to a securitisation are analysed on a case-by-case basis, with approval required from the appropriate credit committee. The analysis looks through to the historical and expected future performance of the underlying assets, the position of the relevant tranche in the capital structure as well as analysis of the cash flow waterfall under a variety of stress scenarios. External ratings and risk- weightings are presented, but only for information purposes since the Bank principally relies on its own internal risk assessment. Overarching these transaction level principles is the Board-approved risk appetite policy, which details the Bank’s appetite for such exposures, and each exposure is considered relative to the Bank’s overall risk appetite. We can use explicit credit risk mitigation techniques where required, however, the Bank prefers to address and manage these risks by only approving exposures for which the Bank has explicit appetite through the constant and consistent application of the risk appetite policy. Securitisation/structured credit analysis In terms of our analysis of our credit and counterparty risk, exposures arising from securitisation/structured credit activities reflect only those exposures to which we consider ourselves to be at risk. ‘Other loans and advances’ refer to exposures that do not relate to the Bank’s core loan activity. | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | Nature of exposure/activity | 31 March 2025 £’million | | 31 March 2024 £’million | | | Balance sheet and credit risk classification | | Structured credit (gross exposure) | 838 | | 738 | | | Other debt securities and other loans and advances | | <40% RWA | 797 | | 736 | | | | >40% RWA | 41 | | 2 | | | | Analysis of gross structured credit exposure | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | £’million | AAA | AA | A | BBB | BB | B and below | Total rated | Total unrated | | Total | | | US corporate loans | 579 | 126 | — | — | — | — | 705 | 25 | | 730 | | | UK RMBS | 35 | 3 | — | — | — | — | 38 | — | | 38 | | | European corporate loans | 42 | 28 | — | — | — | — | 70 | — | | 70 | | | Total at 31 March 2025 | 656 | 157 | — | — | — | — | 813 | 25 | | 838 | | | <40% RWA | 652 | 120 | — | — | — | — | 772 | 25 | | 797 | | | >40% RWA | 4 | 37 | — | — | — | — | 41 | — | | 41 | | | Total at 31 March 2024 | 607 | 95 | 1 | — | — | — | 703 | 35 | | 738 | | 274 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | 64. #### Market risk in the trading book Overview The focus of our trading activities is primarily to support our clients. Our strategic intent is that proprietary trading should be limited and that trading should be conducted largely to facilitate client flow. Within our trading activities, we act as principal with clients or the market. Market risk exists where we have taken on principal positions resulting from market making, underwriting and facilitation of client business in the foreign exchange, interest rate, equity, credit and commodity markets. | | | | --- | --- | | | | | Unaudited_information.svg | Year in review | The year in review has been characterised by a fall in yields across the shorter end of the yield curves and a rise in longer term yields, which has largely unwound the inversion in global yield curves. The UK, US and European central banks cut interest rates as growth slowed and inflation was shown to be under control. In equity markets, the FTSE100 and FTSE250 had divergent performance, ending +8% and -2% respectively at 31 March 2025 (having peaked at +12% and +9%). Uncertainty, driven by the new US administration’s tariff policy, drove equity markets lower and increased volatility during first quarter of 2025. The structured products book continues to wind down and has reduced substantially in size. Over the year, a macro hedge has remained in place, providing downside protection in the event of an extreme market dislocation. The primary focus of all trading activity continues to be managing and hedging the market risk arising from client- related activity, and directional exposures remain at a minimum. Utilisation of risk limits have remained consistently moderate. Risk governance structure Traded market risk is governed by policies that cover the management, identification, measurement and monitoring of market risk. We have independent market risk teams reporting into risk management where limits are approved, managed and monitored. The market risk teams have reporting lines that are separate from the trading function, thereby ensuring independent oversight. The Market Risk Forum, mandated by the IBP ERC, manages market risk in accordance with approved principles, policies and risk appetite. Trading desk risk limits are reviewed by the Market Risk Forum and approved by IBP ERC in accordance with the risk appetite defined by the IBP Board. Any significant changes in risk limits are then reviewed and approved by Investec Group ERC, IBP and DLC BRCCs as well as IBP and DLC and Boards. The appropriateness of limits is continually reassessed, with limits reviewed at least annually, in the event of a significant market event or at the discretion of senior management. | | | | --- | --- | | | | | Unaudited_information.svg | Risk management | Market risk limits are set according to our risk appetite policy. Limits are set at trading desk level with aggregate risk across all desks also monitored against overall market risk appetite limits. Current market conditions, as well as stressed market conditions, are taken into account when setting and reviewing these limits. Market risk teams review the market risks in the trading book, with detailed risk reports produced daily for each trading desk and for the aggregate risk of the trading book. The material risks identified are summarised in daily reports that are distributed to, and discussed with senior management when required. The production of risk reports allows for the monitoring of all positions in the trading book against prescribed limits. Documented policies and procedures are in place to ensure there is a formal process for recognition and authorisation for risk excesses incurred. The risk management software is fully integrated with source trading systems, allowing valuation in risk and trading systems to be fully aligned. All valuation models are subject to independent validation by market risk, ensuring models used for valuation and risk are validated independently of the front office. Risk measurement A number of quantitative measures are used to monitor and limit exposure to traded market risk. These measures include: • Value at Risk (VaR), expected shortfall (ES) and stressed VaR (sVaR) as portfolio measures of market risk exposure • Scenario analysis, stress tests and tools based on extreme value theory (EVT) that measure the potential impact of extreme market moves on portfolio values • Sensitivity analysis that measures the impact of individual market risk factor movements on specific instruments or portfolios, including interest rates, foreign exchange rates, equity prices, credit spreads and commodity prices. We use sensitivity measures to monitor and limit exposure across portfolios, products and risk types. Stress and scenario analyses are used to add insight into the possible outcomes under severe market disruptions. The stress testing methodology assumes that all market factors move adversely at the same time and that no actions are taken during the stress events to mitigate risk. Stress scenarios based on historical experience, as well as hypothetical scenarios, are considered and reviewed regularly for relevance in the ever- changing market environment. Stress scenarios are run daily with analysis presented to IBP Review ERRF weekly and IBP BRCC when the committees meet or more often should market conditions require this. 275 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Value at Risk (VaR) VaR is a technique that estimates the potential losses as a result of movements in market rates and prices over a specified time horizon at a given level of confidence. The VaR model derives future scenarios from a historic time series of market rates and prices, taking into account inter-relationships between the different markets such as interest rates and foreign exchange rates. The VaR model is based on a full revaluation historical simulation and incorporates the following features: • Two-year historical period based on an unweighted time series • Daily movements in each risk factor including foreign exchange rates, interest rates, equity prices, credit spreads and associated volatilities, are simulated with reference to historical market rates and prices, with proxies only used when no or limited historical market data is available • Risk factor movements are based on both absolute and relative returns as appropriate for the different types of risk factors. VaR numbers using a one-day holding period are monitored daily at the 95% and 99% confidence intervals, with limits set at the 95% confidence interval. Expected shortfalls are also monitored daily at the 95% and 99% levels, being the average of the losses in the tail of the VaR distribution. The table below contains the 95% one-day VaR figures for the trading businesses. | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | 31 March 2025 | | | | 31 March 2024 | | | | | | 95% one-day VaR £’000 | Year end | Average | High | Low | Year end | Average | High | Low | | | Interest rates | 19 | 30 | 43 | 19 | 43 | 45 | 60 | 31 | | | Foreign exchange | 16 | 10 | 34 | 3 | 12 | 10 | 98 | — | | | Equities | 154 | 170 | 309 | 94 | 173 | 225 | 641 | 117 | | | Commodities | 4 | 4 | 9 | 2 | 8 | 9 | 15 | 5 | | | Credit | — | 8 | 38 | — | 36 | 32 | 85 | — | | | Consolidated\* | 155 | 172 | 327 | 95 | 186 | 238 | 612 | 137 | | \*The consolidated VaR is lower than the sum of the individual VaRs. This arises from the correlation offset between various asset classes (diversification). Expected shortfall (ES) The ES measure overcomes some of VaR’s shortcomings. ES seeks to quantify losses encountered in the tail beyond the VaR level. The 95% one-day ES is the average loss given that the 95% one-day VaR level has been exceeded. The table below contains the 95% one-day ES figures. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | 95% one-day ES £’000 | 31 March 2025 | | 31 March 2024 | | | Interest rates | 29 | | 59 | | | Foreign exchange | 22 | | 29 | | | Equities | 199 | | 210 | | | Commodities | 5 | | 13 | | | Credit | — | | 48 | | | Consolidated\* | 203 | | 224 | | \*The consolidated ES is lower than the sum of the individual ESs. This arises from the correlation offset between various asset classes. Stressed VaR (sVaR) The sVaR measure is calculated using the VaR model but is based on a one-year period through which the relevant market factors experienced stress. The information in the table below contains the 99% one-day sVaR. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’000 | 31 March 2025 | | 31 March 2024 | | | 99% one-day sVaR | 1 019 | | 694 | | 276 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Backtesting The performance of the VaR model is regularly monitored through backtesting. This is done by comparing daily clean profit and loss against one-day VaR based on a 99% confidence level. Clean profit and loss excludes items such as intra-day transactions, valuation adjustments, provisions, recoveries, commission, fees and hedge costs included in the new trade revenue. If a loss exceeds the one-day VaR, a backtesting exception is considered to have occurred. Over time we expect the average rate of observed backtesting exceptions to be consistent with the percentile of the VaR statistic being tested. This is conducted at an aggregate and desk level on a daily basis. The graph that follows shows the result of backtesting the total daily 99% one-day VaR against the clean profit and loss data for our trading activities over the reporting period. Based on these graphs, we can gauge the accuracy of the VaR figures, i.e. 99% of the time, losses are not expected to exceed the 99% one-day VaR. The average VaR for the year ended 31 March 2025 was lower than for the year ended 31 March 2024. Using clean profit and loss data for backtesting resulted in two exceptions over the period at the 99% confidence level, i.e. where the loss was greater than the 99% one-day VaR, which is in line with the two to three exceptions expected at this confidence level. | | | | --- | --- | | | | | 99% one-day VaR backtesting (£) | | ![1725]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | 99% one-day VaR | | | Clean P/L | 277 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Unaudited_information.svg | Clean profit and loss histogram | The histogram below illustrates the distribution of clean profit and loss during the financial year for our trading businesses. The graph shows that a clean profit was realised on 196 days out of a total of 254 days in the trading business. The average daily clean profit and loss generated for the year to 31 March 2025 was £72 098 (31 March 2024: £70 355). Clean profit and loss Frequency: Days in the year ![1812]() | | | | --- | --- | | | | | | Clean profit/(loss) earned per day (£’million) | | | | | --- | --- | | | | | Unaudited_information.svg | Market risk – derivatives | The Bank enters into various derivative contracts, largely on the back of customer flow. These are used for hedging foreign exchange, interest rates, commodity, equity and credit exposures and to a small extent as principal for trading purposes. Traded instruments include contract for differences, financial futures, options, swaps and forward rate agreements. | | | | --- | --- | | | | | Page_references.svg | Information showing our derivative trading portfolio over the reporting period on the basis of the notional principal and the fair value of all derivatives can be found on pages [194](#i447e4d363cd344738300acdd42f0e3a0_364) and [195](#i58f1c37b9aa0443fbedc9ff4642b01de_942) . | The notional principal indicates our activity in the derivatives market and represents the aggregate size of total outstanding contracts at year end. The fair value of a derivative financial instrument represents the present value of the positive or negative cash flows which would have occurred had we closed out the rights and obligations arising from that instrument in an orderly market transaction at year end. Both these amounts reflect only derivatives exposure and exclude the value of the physical financial instruments used to hedge these positions. 278 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Unaudited_information.svg | 65. Balance sheet risk | Overview The balance sheet risk framework continually ensures that a comprehensive approach is taken to the management and mitigation of liquidity, funding and IRRBB risks, while ensuring adherence to regulatory requirements and internal risk appetite and policies. Risk management Investec plc (and its subsidiaries, including IBP) are ring-fenced from Investec Limited (and its subsidiaries), and vice versa. Both legal entities (and their subsidiaries) are therefore required to be self-funded, and manage their funding, liquidity and IRRBB risk as separate entities. Each banking entity must have its own Board-approved balance sheet risk management policies. Risk appetite limits are set at the relevant Board level and reviewed at least on an annual basis. The size, materiality, complexity, maturity and depth of the market as well as access to stable funds are all inputs considered when establishing the risk appetite for each relevant region. Specific regulatory requirements may further dictate additional restrictions to be adopted in a region. Under delegated authority of the respective Boards, the Investec Group has established ALCOs within each banking entity, using regional expertise and local market access as appropriate. The ALCOs are mandated to ensure independent oversight of liquidity risk and IRRBB. ALCOs assess balance sheet exposures and market conditions to develop strategies for risk mitigation. The Treasury function within each banking entity is mandated to holistically manage the risk on a day-to-day basis. The Treasury function, by banking entity, is required to exercise tight control of all balance sheet risks (liquidity, funding, concentration, encumbrance and IRRBB) within the Board- approved risk appetite limits. IRRBB and asset funding requirements are transferred from the originating business to the Treasury function. The Treasury function, by banking entity, directs pricing for all deposit products, establishes and maintains access to stable funds with the appropriate tenor and pricing characteristics, and manages liquid securities and collateral. Balance sheet risk management is based within Group risk management and is responsible for identifying, quantifying, monitoring and communicating risks while providing independent oversight of the treasury activities and guaranteeing the adherence to the Bank’s policies. Daily, weekly and monthly reports are independently produced highlighting Group activity, exposures and key measures against thresholds and limits and are distributed to management, ALCO, Treasury, IBP Review ERRF, IBP ERC and IBP BRCC as well as summarised reports for Board meetings. There is a regular internal audit of the processes and policies within the balance sheet risk management function, the frequency of which is determined by internal audit. Liquidity risk Overview Cohesive liquidity management is vital for protecting our depositors, preserving market confidence, safeguarding our reputation and ensuring sustainable growth with established funding sources. Through active liquidity management, we seek to preserve stable, reliable and cost-effective sources of funding. Risk management and measurement A suite of internal and regulatory metrics are used on a current and forward-looking basis to manage liquidity risk and funding risk. Future cash flows are monitored on a contractual, business-as-usual and stressed basis. Stress testing is based on a range of historical and hypothetical scenarios. We further carry out reverse stress tests to identify business model vulnerabilities which tests ‘tail risks’ that can be missed in normal stress tests. Additionally, Investec plc maintains a contingency funding plan which details the course of actions that can be taken in the event of a liquidity stress. The plan helps to ensure that cash flow estimates and commitments can be met in the event of general market disruption or adverse bank-specific events, while minimising detrimental long-term implications for the business. The plans are tested internally to assess the Group’s readiness and ability to adequately contain a liquidity stress. | | | | --- | --- | | | | | Page_references.svg | Further information on recovery and resolution planning can be found on page [286](#ib2fe0d6b03b544f19e301b71680849d9_0-1-1-1-2494133) . | To protect against potential shocks, we hold a liquidity buffer in the form of cash, unencumbered high-quality liquid assets (typically in the form of government or rated securities eligible for repurchase with the central bank). The liquidity buffer is well in excess of regulatory requirements as protection against disruptions in cash flows. The liquidity buffer is managed within Board- approved targets. The Bank remains a net liquidity provider to the interbank market, placing significantly more funds with other banks than our short- term interbank borrowings. We do not rely on overnight interbank deposits to fund term lending. For non-cash items, prudent market risk limits are in place to control the market volatility of securities and the amount of cash that can be generated by those securities under a market stress. From 1 April 2024 to 31 March 2025 average cash and near cash balances over the period amounted to £9.9 billion. 279 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Liquidity mismatch The following tables show the Bank’s contractual and behavioural liquidity gaps. The contractual liquidity table records all assets and liabilities with the underlying contractual maturity. With respect to the behavioural liquidity table, we adjust the contractual profile of certain assets and liabilities: • Liquidity buffer: the actual contractual profile of the assets in the liquidity buffer is of little consequence, as practically the Bank would meet any unexpected net cash outflows by repo’ing or selling these highly liquid securities. Consequently, for the liquidity buffer: – The time horizon to monetise our regulatory liquid assets which are guaranteed by the central bank has been adjusted to ‘on demand’ – The time horizon for the near cash portfolio of discretionary treasury assets has been set to one month where there are deep secondary markets for this elective asset class. • Customer deposits: historical observations were used to model the behavioural maturity profile, and this analysis has identified significant additional sources of structural liquidity in the form of core deposits that exhibit stable behaviour. Contractual liquidity at 31 March 2025 | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | £’million | Demand | Up to one month | One to three months | Three to six months | Six months to one year | One to five years | > Five years | | Total | | | Cash and short-term funds – banks | 5 032 | 20 | — | — | — | — | — | | 5 052 | | | Investment/trading assets | 503 | 923 | 1 159 | 1 213 | 289 | 947 | 1 747 | | 6 781 | | | Securitised assets | — | — | — | — | — | — | — | | — | | | Advances | 217 | 623 | 650 | 1 296 | 1 938 | 8 901 | 3 352 | | 16 977 | | | Other assets excluded above | 59 | 351 | 40 | 52 | 135 | 273 | 14 | | 924 | | | Assets | 5 811 | 1 917 | 1 849 | 2 561 | 2 362 | 10 121 | 5 113 | | 29 734 | | | Deposits – banks | (189) | — | — | — | (705) | (584) | — | | (1 478) | | | Deposits – non-banks | (7 168) | (1 371) | (5 980) | (3 500) | (2 314) | (1 218) | (4) | | (21 555) | | | Negotiable paper | (1) | (1) | (13) | (11) | (84) | (864) | — | | (974) | | | Securitised liabilities | — | — | — | — | — | — | — | | — | | | Investment/trading liabilities | (98) | (125) | (43) | (26) | (53) | (88) | (36) | | (469) | | | Subordinated liabilities | — | — | — | — | (41) | (641) | — | | (682) | | | Other liabilities excluded above | (244) | (167) | (172) | (53) | (140) | (108) | (19) | | (903) | | | Liabilities | (7 700) | (1 664) | (6 208) | (3 590) | (3 337) | (3 503) | (59) | | (26 061) | | | Total equity | — | — | — | — | — | — | (3 673) | | (3 673) | | | Contractual liquidity gap | (1 889) | 253 | (4 359) | (1 029) | (975) | 6 618 | 1 381 | | — | | | Cumulative liquidity gap | (1 889) | (1 636) | (5 995) | (7 024) | (7 999) | (1 381) | — | | | | Behavioural liquidity at 31 March 2025 | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | £’million | Demand | Up to one month | One to three months | Three to six months | Six months to one year | One to five years | > Five years | | Total | | | Behavioural liquidity gap | 4 754 | 10 | (5 061) | (1 973) | (1 108) | 2 039 | 1 339 | | — | | | Cumulative | 4 754 | 4 764 | (297) | (2 270) | (3 378) | (1 339) | — | | | | 280 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Funding strategy Overview We maintain a funding structure of stable customer deposits and long-term wholesale funding well in excess of funded assets. We target a diversified funding base, avoiding undue concentrations by investor type, maturity, market source, instrument and currency. We acknowledge the importance of our retail deposit client base as the principal source of stable and granular funding. We continue to develop products to attract and service the investment needs of our client base in line with our risk appetite. The Bank actively participates in global financial markets and our relationships are continuously enhanced through regular investor engagements. Entities are only allowed to have funding exposure to wholesale markets where they can demonstrate that the market is sufficiently deep and liquid, and then only relative to the size and complexity of their business as part of a diversified funding mix. The Bank’s ability to access funding at cost-effective levels is influenced by maintaining or improving the entity’s credit rating. A reduction in credit ratings could have an adverse effect on the Bank’s funding costs, and on access to wholesale term funding; however our diversified funding base places limited reliance on wholesale funding and protects our ability to raise sufficient funding under both business as usual and stressed market conditions. Funding continues to be dynamically raised through a mix of customer liabilities diversified by customer type, currency, channel and tenor, avoiding reliance on any particular source and ensuring continued access to a wide range of depositors. Those diversified funding channels have proven to be capable of raising funding throughout the year to support asset growth despite the uncertain macro-economic environment, persistent market volatility and increased competition for deposits. We have limited reliance on wholesale funding but we maintain access and presence, using such wholesale issuance to strategically diversify our funding base and complement the other liability channels by focusing, where appropriate, on tenor and currency as part of a longer term strategic plan. Funding consists primarily of customer deposits, with loans and advances to customers as a percentage of customer deposits at 78.0% at 31 March 2025 (31 March 2024: 79.5%). We are therefore well positioned from a funding and liquidity perspective if there were to be further disruption to financial markets given both the highly diversified nature of Investec plc’s deposit base and the reliance on term and notice deposits rather than demand deposits. Deposits grew by 3.4% over the year from £20.9 billion to £21.6 billion at 31 March 2025. Granularity of deposits is a key area of focus and IBP has a substantial portion of eligible deposits that are covered by FSCS protection. The FSCS is a UK government-backed scheme designed to provide protection to eligible customers, to the maximum value of £85 000, in the event that a financial institution is unable to meet its financial obligations. The PRA has proposed to raise the deposit protection limit to £110 000 from 1 December 2025. As at 31 March 2025, the preferred resolution strategy for IBP remained bank insolvency procedure with no MREL requirement in excess of its minimum capital requirements. The BoE formally notified Investec plc on 28 June 2023 that the preferred resolution strategy will change from bank insolvency procedure to bail-in and as such Investec plc, and IBP as a material subsidiary, will be subject to a revised Minimum Requirements for Own Funds and Eligible Liabilities (MREL) requirement. The MREL transition will commence from 1 January 2026 in a phased manner with end-state MREL applying from 1 January 2032. Wholesale issuance in the year took advantage of market windows to focus on refinancing upcoming calls to lengthen term, with the added benefit of continuing to diversify the debt capital markets investor base and support the MREL transition. Any additional MREL requirements will be met over time as part of increasing wholesale market issuance from the existing established base and we will continue to evaluate issuance opportunities in the near term as part of this glide path. IBP repaid £0.5 billion of drawings under the BoE Term Funding Scheme with additional incentives for Small and Medium Enterprises (TFSME) during the year. As at 31 March 2025, the Bank had £0.7 billion of remaining drawings outstanding. These mature in late 2025. Looking forward, the focus remains on maintaining a strong liquidity position to protect from overall market volatility. Funding continues to be actively raised, across a diverse funding base, in line with a medium- to long-term strategy to reduce the overall tenor-adjusted cost of the liability base, supported by IBP’s stable credit ratings. | | | | --- | --- | | | | | Page_references.svg | Refer to page [396](#i447e4d363cd344738300acdd42f0e3a0_541) for further detail on credit ratings | Cash and near cash trend £’million ![5497558165022]() | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | Central bank cash placements and other HQLA | | | Cash | | | Near cash | 281 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | | --- | --- | --- | | | | | | An analysis of cash and near cash at 31 March 2025 | | Customer accounts (deposits) by type at 31 March 2025 | | £9 090 million | | £21 555 million | ![5497558165028]() ![5497558165030]() | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | Central bank cash placements and other HQLA | 87.3% | | | Individuals | 63.3% | | | Cash | 9.2% | | | Other financial institutions and corporates | 29.7% | | | Near cash | 3.5% | | | Small business | 7.0% | Asset encumbrance An asset is defined as encumbered if it has been pledged as collateral against an existing liability and, as a result, is no longer available to the Bank to secure funding, satisfy collateral needs or be sold to reduce funding requirement. Encumbered assets are identified in accordance with the definitions under European Capital Requirements Regulation (CRR), and regular reporting is provided to the PRA. Risk management monitors and manages total balance sheet encumbrance within a Board-approved risk appetite limit. Asset encumbrance is one of the factors considered in the discussion of new products or new funding structures, and the impact on risk appetite is assessed. The Bank uses secured transactions to manage short-term cash and collateral needs, and utilises securitisations in order to raise external term funding as part of its diversified liability base. Securitisation notes issued are also retained by the Bank which are eligible for the BoE’s Single Collateral Pool to support central bank liquidity facilities. | | | | --- | --- | | | | | Page_references.svg | On page [192](#i447e4d363cd344738300acdd42f0e3a0_352) we disclose further details of assets that have been received as collateral under reverse repurchase agreements and securities borrowing transactions where the assets are allowed to be resold or pledged. | 282 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Interest rate risk in the banking book (IRRBB) Overview IRRBB is an inherent consequence of conducting banking activities, and arises from the provision of non-trading banking products and services. The Bank considers the management of banking margin of vital importance, and our IRRBB philosophy is reflected in our day-to-day practices. The aim of IRRBB management is to protect net interest earnings and economic value of equity in accordance with the Board-approved risk appetite. Sources of IRRBB include: • Repricing risk: arises from the timing differences in the fixed rate maturity and floating rate repricing of Bank assets, liabilities and derivative positions. This affects the interest rate margin realised between lending income and borrowing costs when applied to our rate sensitive portfolios • Yield curve risk: repricing mismatches also expose the Bank to changes in the slope and shape of the yield curve • Basis risk: arises from imperfect correlation in the adjustments of the rates earned and paid on different instruments with otherwise similar repricing characteristics • Embedded option risk: arises from optional elements embedded in items where the Bank or its customers can alter the level and timing of their cash flows, such as the prepayment of fixed rate loans and withdrawal of non- maturity deposits (NMDs) • Endowment risk: refers to the interest rate risk exposure arising from the net differential between interest rate insensitive assets, interest rate insensitive liabilities and capital. The above sources of interest rate risk affect the interest rate margin realised between lending income and borrowing costs when applied to our rate sensitive asset and liability portfolios, which has a direct effect on future net interest earnings and the economic value of equity. Risk management and measurement Each banking entity has its own Board-approved IRRBB appetite, which is clearly defined in relation to both income risk and economic value risk. The Bank has limited appetite for IRRBB. Operationally, daily management of interest rate risk is centralised within the Treasury of each banking entity and is subject to local independent risk and ALCO review. Treasury mitigates any residual undesirable risk where possible, by changing the duration of the banking book’s discretionary liquid asset portfolio, or through derivative transactions. The Treasury mandate allows for a tactical response to market volatility which may arise during changing interest rate cycles, in order to hedge residual exposures. Any resultant interest rate position is managed under the IRRBB risk limits. Balance sheet risk management independently monitors a broad range of interest rate risk metrics to changes in interest rate risk factors, detailing the sources of interest rate exposure. Automatic optionality arising from variable rate products with an embedded minimum lending rate serves as an income protection mechanism for the Bank against falling interest rates, while behavioural optionality risk from customers of fixed rate products is mitigated by early repayment charges. The UK Bank maintains a structural hedging programme to reduce the sensitivity of earnings to short-term interest rate movements. An amortising profile of £1.8 billion tangible equity has been assigned with an average duration of 2.5 years evenly distributed over the period. The termed equity is then hedged and managed within the overall interest rate risk appetite. IRRBB is measured and analysed by utilising standard tools of traditional interest rate repricing mismatch and net present value (NPV) sensitivity to changes in interest rate risk factors: • Income metrics capture the change in accruals expected over a specified time horizon in response to a change in interest rates • Economic value metrics capture all future cash flows in order to calculate the Bank’s net worth and therefore can highlight risks beyond the short-term earnings time horizon. These metrics are used to assess and to communicate to senior management the financial impact of possible future interest rate scenarios, covering: • Interest rate expectations and perceived risks to the central view • Standard shocks to levels and shapes of interest rates and yield curves. The repricing gap provides a simple representation of the balance sheet, with the sensitivity of fair values and earnings to changes to interest rates calculated off the repricing gap. This also allows for the detection of interest rate risk concentration in specific repricing buckets. Net interest income sensitivity measures the change in accruals expected over the specified horizon in response to a shift in the yield curve. Economic value sensitivity and stress testing to macro-economic movement or changes to the yield curve measures the interest risk implicit change in net worth as a result of a change in interest rates on the current values of financial assets and liabilities. Economic value measures have the advantage that all future cash flows are considered and therefore assess the risk beyond the earnings horizon. Net interest income sensitivity IRRBB is measured and monitored using an income sensitivity approach. The tables below reflect an illustrative annualised net interest income value sensitivity to a 0.25% parallel shift in interest rates, based on modelled assumptions, assuming no management intervention. UK and Other | | | | | --- | --- | --- | | | | | | £’million | 31 March 2025 | 31 March 2024 | | 25bps down | (9.3) | (8.0) | | 25bps up | 7.9 | 7.2 | Economic value (EV) sensitivity at 31 March 2025 IRRBB is measured and monitored using the EV sensitivity approach. The table below reflects an illustrative economic value sensitivity to a 2% parallel shift in interest rates, based on modelled assumptions, assuming no management intervention. This sensitivity effect would only have a negligible direct impact on our equity. | | | | | --- | --- | --- | | | | | | £’million | 31 March 2025 | 31 March 2024 | | 200bps down | (5.8) | 2.8 | | 200bps up | (8.2) | (9.1) | 283 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Regulatory requirements Liquidity risk The two minimum BCBS standards for funding liquidity are: • The Liquidity Coverage ratio (LCR) which is designed to ensure that banks have sufficient high-quality liquid assets to meet their liquidity needs throughout a 30-calendar day severe stress • The Net Stable Funding ratio (NSFR) which is designed to capture structural issues over a longer time horizon by requiring banks to have a sustainable maturity structure of assets and a stable liability base. The LCR is calculated based on the rules contained in the PRA rulebook overlaid with our own interpretations where the regulation requires. Banks are required to maintain a minimum LCR of 100%. As at 31 March 2025 the LCR was 418%for IBP (solo basis). Within the UK, the NSFR has become a binding requirement for banks since January 2022. Banks are now required to maintain a minimum NSFR of 100%. The NSFR at 31 March 2025 was 144% for IBP (solo basis). Investec plc undertakes an annual ILAAP which documents the approach to liquidity management across the firm. This document is approved by the IBP and DLC Boards before being provided to the PRA for use, alongside the Liquidity Supervisory Review and Evaluation Process, to determine the bank’s Individual Liquidity Guidance, also known as a Pillar II requirement. IRRBB In 2016, the BCBS finalised their standards for IRRBB which recommended the risk is assessed as part of the Bank’s capital requirements, outlined six prescribed shock scenarios, and recommended enhanced disclosure requirements for supervisors to implement. The regulatory framework requires banks to assess their Pillar II requirements, including those related to IRRBB, as part of their ICAAP in accordance with PS22/21 and SS31/15. This is reviewed on at least an annual basis and reviewed and approved by IBP BRCC, DLC BRCC and by the IBP and DLC Boards. 284 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Unaudited_information.svg | 66. Operational risk | Overview Operational risk is an inherent risk in the ordinary course of business activity. The impact could be financial as well as non- financial. Possible non-financial impacts could include customer detriment, reputational or regulatory consequences. Risk management and measurement The operational risk governance structures form an integral part of the operational risk management framework. The Bank, in keeping with sound governance practices, has defined roles and responsibilities for the management of operational risk in accordance with the three lines of defence model, i.e. business line management, an independent operational risk function and an independent internal audit function. Specialist control functions are responsible for the management of key operational risks. These include, but are not limited to: compliance (including financial crime compliance), cyber, finance, fraud, legal, technology and information security risks. Operational risk is managed and monitored through various governance forums and committees that are integrated with the Bank’s risk management governance structure and report to Board level committees. The Bank’s operational risk profile is reported to the governance forums and committees on a regular basis, which contributes to sound risk management and decision-making by the Board and management. Management forums and committees are in place at each entity level. Key responsibilities include the monitoring of operational risk and oversight of the operational risk management framework, including approval of the operational risk management policies. The DLC IT Risk and Governance Committee is responsible for the monitoring of current and emerging technology and information security risks. In addition, this committee considers the strategic alignment of technology within the business. The UK Technology Management Committees monitor technology risks for the UK entities and escalate current and emerging risks to the DLC IT Risk and Governance Committee and relevant local risk governance forums and committees. Operational risk appetite is defined as the level of risk exposure that is acceptable to the Board in order to achieve its business and strategic objectives. The Board is responsible for setting and regularly reviewing the risk appetite. The operational risk appetite policy defines the amount of operational risk exposure, or potential adverse impact of a risk event, that the Bank is willing to accept through quantitative and qualitative measures. Operational risks are managed in accordance with the approved risk appetite. Any breaches of limits are escalated in accordance with the appropriate governance structures. The Bank manages operational risk through an operational risk management framework that is embedded across all levels of the organisation and is supported by a strong risk management culture. The key purpose of the operational risk management framework is to define the policies and practices that provide the foundation for a structured and integrated approach to identify, assess, mitigate/manage, monitor and report on operational risks. The key operational risk practices are as follows: | | | | --- | --- | | | | | Identify and assess | | | Risk and control assessments | • Risk and control assessments are forward-looking, qualitative assessments of inherent and residual risk that are performed on key business processes using a centrally defined risk framework • These assessments enable business to identify, manage and monitor operational risks, incorporating other elements of the operational risk management framework such as risk events and key indicators • Detailed control evaluations are performed, and action plans developed and implemented where necessary to ensure that risk exposure is managed within acceptable levels. | | Internal risk events | • Internal risk events provide an objective source of information relating to failures in the control environment • The tracking of internal risk event data provides an opportunity to improve the control environment and to minimise the occurrence of future risk events • In addition, internal risk event data is used as a direct input into the Pillar II capital modelling process. | | External risk events | • External risk events are operational risk related events originating outside the organisation • Investec Group is an active member of a global external data service used to benchmark our internal risk event data against other local and international financial service organisations • The external data is analysed to enhance the control environment, inform scenario analysis and provide insight into emerging operational risks. | | Mitigate/manage | | | Risk exposures | • Risk exposures are identified through the operational risk management processes, including but not limited to risk assessments, internal risk events, key indicators and audit findings • Residual risk exposure is evaluated in terms of the Group’s risk appetite and mitigated where necessary by improving the control environment, transferring through insurance, terminating the relevant business activity or accepting the risk exposure for a period of time subject to formal approval and monitoring. | | Monitor | | | Key risk indicators | • Indicators are metrics used to monitor risk exposures against identified thresholds • The output provides predictive capability in assessing the risk profile of the business. | 285 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Year in review During the year the Bank remained focused on the management of the following key operational risks: Business disruption and operational resilience risk • The Bank’s resilience capabilities are regularly exercised through rigorous testing against severe but plausible scenarios • Significant planning and testing have been performed to ensure recovery time objectives and impact tolerances are achievable and mitigate against client harm and maintain overall operational soundness and safety • We remain actively involved with key industry regulatory bodies, participating in relevant discussions, testing exercises and initiatives • The Bank remains committed to upholding global regulatory requirements for operational resilience, whilst delivering value to our stakeholders. Information security and cyber risk • Information and cyber security were a key focus for the Bank, cognisant of their dynamic nature and evolving sophistication • The use of AI by threat actors to automate and enhance attack techniques was observed, including AI-driven phishing campaigns and deepfake fraud • Cyber threats linked to geopolitical tensions were monitored, with isolated cases of financial institutions being impacted by state-sponsored attacks. Threat simulations with independent specialists were conducted to stress-test security controls and provide insights to enhance our defences. The Bank’s risk exposure was effectively managed and external cyber security ratings placed Investec’s cyber posture above industry peers. Technology risk • High rates of technology change and increased cloud adoption were observed as part of the Bank’s modernisation programmes • A global technology command centre was established, supporting proactive monitoring, response to, and management of technology disruptions • Rapid technological developments such as those related to generate AI were closely tracked and associated risks were actively monitored. Third party risk • As part of our strategic modernisation initiatives and cloud- first approach, an increasing use of third party providers was noted. Associated risks were well-managed • We focused on better understanding our third parties and their supply chain to support comprehensive review and management of our third party risks to safeguard the organisation • Review and management of third party concentration risks was a key priority for the Bank, and further enhanced visibility of potential systemic concentration risk within the financial sector • Continuous enhancements in third party due diligence and reporting practices aligned with evolving regulatory requirements and facilitated effective risk mitigation strategies • We observed an increasing number of third parties introducing artificial intelligence capabilities into their services and operations, and considered the risks that this may introduce. Processing and execution risk • Processing and execution risks identified through internal risk event monitoring remain a significant operational risk theme due to the frequency and monetary impact of reported operational risk loss events • Loss events have been observed across various processes, predominantly resulting from factors such as unintentional human error, ineffective change management, inadequate process design, and insufficient management oversight • Operational risk loss events are thoroughly investigated and appropriate actions are taken to improve controls • Despite the Bank's commitment to digitalisation, there is still a reliance on manual processes. When automation is not possible, process redesign is undertaken to address control gaps. Additionally, there is a strong emphasis on monitoring key controls through collaborative assurance initiatives • Every effort is made to minimise the impact of processing and execution risks on clients by promptly implementing recovery measures. External fraud • Practices that align with updated regulations, industry guidance, and best practices are firmly established within the Bank • Our focus is on enhancing stringent fraud prevention and detection controls, which are continuously improved in response to evolving regulatory requirements and the rising incidence of fraud across the industry, driven by both existing and emerging methods of operation. Ongoing collaboration within the industry supports our fraud prevention efforts and aids in the recovery of funds related to fraudulent pay-outs. Insurance The Bank maintains adequate insurance to cover key insurable risks. The insurance process and requirements are managed by the Group insurance risk manager. Regular interaction between operational risk management and insurance risk management ensures that there is an exchange of information in order to enhance the mitigation of operational risk. | | | | --- | --- | | | | | Page_references.svg | Please refer to pages 83 to 87 of the Investec Group's 2025 risk and governance report for additional information regarding compliance, reputational risk and legal risk. | 286 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Unaudited_information.svg | 67. Recovery and resolution planning | The purpose of the recovery plan is to document how the Investec plc Board and management will plan for Investec plc to recover from extreme financial stress to avoid liquidity and capital difficulties. The plans are reviewed and approved by the IBP and Investec plc Boards on an annual basis. The focus of the Investec plc recovery plan is the recovery of IBP and the protection of its depositors and other clients. The plan: • Identifies roles and responsibilities • Identifies early warning indicators and trigger levels • Analyses how the Group could be affected by the stresses under various scenarios • Includes potential recovery actions available to the Boards and management to respond to the situation, including immediate, intermediate and strategic actions • Identify the recovery capacity available to avoid resolution actions • Integrates with existing contingency planning • Run externally facilitated simulations or firedrill exercises as required by the regulations. The Bank Recovery and Resolution Directive (BRRD) was implemented in the UK via the UK Banking Act 2009. It was recently amended by the BRRD (Amendment) (EU Exit) Regulation 2020, which implemented into UK law certain amendments to the BRRD which were required to be implemented prior to the UK leaving the EU. The BoE, the UK resolution authority has the power to intervene in and resolve a financial institution that is no longer viable. This is achieved through the use of various resolution tools, including the transfer of business and creditor financed recapitalisation (bail-in within resolution) that allocates losses to shareholders and unsecured and uninsured creditors in their order of seniority, at a regulator determined point of non-viability that may precede insolvency. The PRA has made rules that require authorised institutions to draw up recovery plans and resolution packs. Recovery plans are designed to outline credible recovery options that authorised institutions could implement in the event of severe stress in order to restore their business to a stable and sustainable condition. The resolution pack contains detailed information on the services provided, as well as the structure and operation of the authorised institution in question which will be used by the BoE to develop resolution strategies for that specific institution, assess its current level of resolvability against the strategy, and to inform work on identifying barriers to the implementation of operational resolution plans. In line with PRA and onshored EU requirements, Investec plc maintains a resolution pack and a recovery plan. Even though the recovery plan is framed at Investec plc level, given that IBP constitutes over 78% of Investec plc’s balance sheet, the focus of this document is the recovery of IBP and the protection of its depositors and other clients. In the UK, the contingency funding plan is included in the recovery plan and details the course of actions that can be taken in the event of a liquidity stress. Similarly, the resolution pack is drafted for Investec plc. As Investec plc is an approved UK Financial Holding Company (FHC) and IBP is its most significant entity, the Investec plc resolution strategy is expected to be driven and determined by IBP’s resolution strategy. The resolution pack contains essential information that enables regulators to understand the firm's structure, operations, and potential resolution strategies. As of March 2025, the preferred resolution strategy for IBP remained bank insolvency procedure with no MREL requirement in excess of its minimum capital requirements. However, the BoE formally notified Investec plc on 28 June 2023 that the preferred resolution strategy will change from bank insolvency procedure to bail-in and as such Investec plc, and IBP as a material subsidiary, will be subject to a revised MREL requirement. The MREL transition will commence from 1 January 2026 in a phased manner with end-state MREL applying from 1 January 2032. Any additional MREL requirements will be met over time as part of increasing wholesale market issuance from the existing established base and we will continue to evaluate issuance opportunities in the near term as part of this glide path. As a bail-in firm, Investec plc will come into scope of the BoE’s Resolvability Assessment Framework and is committed to ensuring its resolution capabilities meet the required regulatory standards. 287 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | 68. #### Capital management and allocation The content presented within this section is unaudited unless denoted with the following ![Audited_Yes_Black.png]() Overview ![Audited_Yes_Black.png]() IBP is authorised by the PRA and is regulated by the FCA and the PRA. The Bank calculates capital resources and requirements using the Basel III framework, as implemented in the European Union through the Capital Requirements Regulation (CRR) and the Capital Requirements Directive IV (CRD IV), as amended by CRR II and CRD V. Following the end of the Brexit transitional period, the EU rules (including binding technical standards) were onshored and now form part of domestic law in the UK by virtue of the European Union (Withdrawal) Act 2018. IBP applies the Standardised Approach to calculate credit risk and counterparty credit risk, credit valuation adjustment (CVA) risk, securitisation risk, operational risk and market risk capital requirements. Since 1 January 2022, IBP adopted the outstanding CRR II changes to be implemented in the UK, most notably the new Standardised Approach for measuring Counterparty Credit Risk (SA- CCR) and changes to the large exposure regime. IBP is not subject to the minimum leverage ratio requirement of 3.25% under the UK leverage ratio framework, but is subject to a ‘supervisory expectation’ to manage excessive leverage by ensuring the leverage ratio does not fall below 3.25%. For simplicity, the same leverage ratio exposure measure and capital measure applies to all UK banks (including the exemption of central bank reserves and reflect updated international standards). Subsidiaries of IBP may be subject to additional regulations as implemented by local regulators in their respective jurisdictions. Where capital is a relevant consideration, management within each regulated entity pays close attention to prevailing local regulatory rules as determined by their respective regulators. A summary of capital adequacy and leverage ratios | | | | | --- | --- | --- | | | | | | | 31 March 2025\* | 31 March 2024\* | | Common Equity Tier 1 ratio\*\* | 13.6% | 13.3% | | Common Equity Tier 1 ratio (fully loaded)\*\*\* | 13.6% | 13.2% | | Tier 1 ratio\*\* | 15.4% | 15.9% | | Total Capital ratio\*\* | 19.2% | 19.8% | | Risk weighted assets (£'million)\*\* | 18 908 | 18 054 | | Leverage exposure measure (£'million) | 27 906 | 26 746 | | Leverage ratio | 10.5% | 10.7% | | Leverage ratio (fully loaded) \*\*\* | 10.5% | 10.7% | \*The capital adequacy and leverage disclosures for IBP include the deduction of foreseeable charges and dividends when calculating CET1 and Tier 1 capital. These disclosures differ from the disclosures included in the Investec Group’s year-end results booklet 2025, which follow our normal basis of presentation and do not include this deduction. IBP’s CET1 ratio would be 37bps (31 March 2024: 34bps) and leverage ratio 25bps (31 March 2024: 23bps) higher, on this basis. \*\*The CET1, Tier 1, Total Capital ratios and RWAs are calculated applying the IFRS 9 transitional arrangements. \*\*\*The CET1 ratio (fully loaded) and the leverage ratio (fully loaded) assumes full adoption of IFRS 9. Philosophy and approach ![Audited_Yes_Black.png]() The Bank's approach to capital management utilises both regulatory capital as appropriate to the jurisdiction in which it operates and internal capital, which is an internal risk-based assessment of capital requirements. Capital management primarily relates to management of the interaction of both, with the emphasis on regulatory capital for managing portfolio level capital sufficiency and on internal capital for ensuring that returns are appropriate given the level of risk taken at an individual transaction or business unit level. We intend to maintain a sufficient level of capital to satisfy regulatory requirements and our internal target ratios. We target a Total Capital ratio range of between 14% and 17% on a consolidated basis, and we target a minimum Tier 1 ratio of 11% and a CET1 ratio above 10%. The determination of target capital is driven by our risk profile, strategy and risk appetite, taking into account the regulatory and market factors applicable to the Group. At the most fundamental level, we seek to balance our capital consumption between prudent capitalisation in the context of the Group’s risk profile and optimisation of shareholder returns. Our internal capital framework is designed to manage and achieve this balance. The internal capital framework is based on the Group’s risk identification, review and assessment processes and is used to provide a risk-based approach to capital allocation, performance and structuring of our balance sheet. The objectives of the internal capital framework are to quantify the minimum capital required to: • Maintain sufficient capital to satisfy the Board’s risk appetite across all risks faced by the Group • Provide protection to depositors against losses arising from risks inherent in the business • Provide sufficient capital surplus to ensure that the Group is able to retain its going concern basis under relatively severe operating conditions • Inform the setting of minimum regulatory capital through the ICAAP and subsequent Supervisory Review and Evaluation Process (SREP) review. The ICAAP documents the approach to capital management, including the assessment of the regulatory and internal capital position of each Group • The ICAAP is reviewed and approved by IBP BRCC and the Board. 288 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | The framework has been approved by the Board and is managed by the IBP Capital Committee, which is responsible for oversight of the management of capital on a regulatory and an internal capital basis. Capital planning and stress/scenario testing A capital plan is prepared for IBP and maintained to facilitate discussion of the impact of business strategy and market conditions on capital adequacy. This plan is designed to assess capital adequacy under a range of economic and internal conditions over the medium term (three years), with the impact on earnings, asset growth, risk appetite and liquidity considered. The plan provides the Board with an input into strategy and the setting of risk appetite by considering business risks and potential vulnerabilities, capital usage and funding requirements given constraints where these exist. Capital plans are prepared and presented to the Capital Committees on a monthly basis. The plans are updated with the actual month-end position and forecast out to the end of the fiscal year, taking into account updated profit and loss and asset growth forecasts. The goal of capital planning is to provide insight into potential sources of vulnerability of capital adequacy by way of market, economic or internal events. As such, the three-year capital plans are stressed based on conditions most likely to cause IBP duress. The conditions are agreed by the IBP Capital Committee after the key vulnerabilities have been determined through the stress testing workshops. Such plans are used by management to formulate balance sheet strategy and agree management actions, trigger points and influence the determination of our risk appetite. At a minimum level, each capital plan assesses the impact on our capital adequacy in an expected case and in downturn scenarios. On the basis of the results of this analysis, the IBP Capital Committee, the DLC Capital Committee and the IBP BRCC are presented with the potential variability in capital adequacy and are responsible, in consultation with the Board, for considering the appropriate response. Reverse stress testing is performed annually as part of the ICAAP process.IBP applies the Standardised Approach to calculate credit risk and counterparty credit risk, credit valuation adjustment (CVA) risk, securitisation risk, operational risk and market risk capital requirements. Year in review During the year under review, IBP complied with the capital adequacy requirements imposed on it by the PRA. IBP continues to hold capital in excess of all the capital and buffer requirements. At 31 March 2025, the CET1 ratio increased to 13.6% from 13.3% at 31 March 2024. CET1 capital increased by £161 million to £2.6 billion, mainly as a result of CET1 capital generation of £366 million through profit after taxation. The increases is partially offset by: • Dividends paid to ordinary shareholders and Additional Tier 1 security holders of £158 million • A net decrease in other comprehensive income of £14 million and the reversal of the cash flow hedge reserve which is not recognised in CET1 capital of £11 million • A decrease of £17 million in the IFRS 9 transitional add-back adjustment • An increase in the goodwill and intangible asset net of deferred taxation deduction of £10 million • An increase in foreseeable charges and dividends of £8 million. Risk weighted assets (RWAs) increased by 3.8% or £712 million to £19.2 billion over the period, predominantly within credit risk and operational risk RWAs. Credit risk RWAs, which includes equity risk, increased by £323 million. The increase reflects asset growth in Fund Finance, Asset Finance and Credit Investments, offset by redemptions across multiple business lines. Counterparty credit risk RWAs (including CVA risk) increased by £96 million compared to 31 March 2024. The increase in RWAs is driven by exposure at default (EAD) increases across foreign exchange and interest rate derivatives and commodity swaps. The EAD increases have been caused by currency fluctuations and geopolitical risks which have lead to greater price volatility. Market risk RWAs increased by £18 million, due to increases in banking book foreign exchange risk, driven by increases in net open position across multiple currencies. Operational risk RWAs increased by £812 million to £2.3 billion, driven by an increase in the three-year average operating income used to determine the capital requirement, with approximately half of the increase attributable to the inclusion of Investec’s proportionate 41.25% share of Rathbones gross income in the three-year average. The Group's leverage ratio decreased to 10.5% from 10.7% at 31 March 2024. Tier 1 capital increased by £53 million, driven by a £161 million increase in CET1 capital, which was partially offset by the redemption of £108 million AT1 instruments in December 2024. The leverage exposure measure increased by £1.2 billion, driven by asset growth across multiple balance sheet line items, most notably increases in sovereign debt securities of £576 million and reverse repurchase agreements of £481 million, partially offset by a reduction in derivative financial instruments of £473 million. In addition off-balance sheet exposures increased by £419 million, with the majority of the increase attributable to credit investments. Regulatory developments Basel 3.1 standards The UK Basel 3.1 proposals were first released by the PRA in November 2022. The Basel 3.1 reforms aim to restore credibility in risk-weighted ratios, by introducing more robust and risk- sensitive SAs, whilst curtailing the RWA benefits Internal Models can provide. The proposals aim to advance the PRA’s primary objective to promote the safety and soundness of the firms that it regulates. By improving the measurement of risk, the PRA are of the view that it will help ensure firms are adequately capitalised given the risks they are exposed to. Whilst the PRA was proposing limited adjustments to the international standards in order to adhere to the global reforms, they did propose to remove several onshored EU discretions, such as the small and medium-sized enterprise (SME) and infrastructure lending supporting factors. The first policy statement on the Basel 3.1 reforms were published in December 2023 and covered market risk, counterparty credit risk, credit valuation adjustment risk and operational risk. Subsequently, on 12 September 2024, the PRA published its second near-final policy statement which provides feedback to responses received from industry on specific policy areas, namely credit risk (standardised and internal ratings- based approaches), credit risk mitigation, the output floor, Pillar 289 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | 3 disclosures and reporting. The statement also provided feedback on parts of the Pillar 2 framework relating to the Pillar 2A credit risk methodology, use of internal based approach benchmarks and the interaction with the output floor. The PRA had initially confirmed in a statement released in September 2023, that the implementation date would be delayed by six months to 1 July 2025, with full compliance required by 1 January 2030. Since that statement and the publication of the first policy statement in December 2023, the PRA has continued to monitor the implementation times of other jurisdictions and the adequacy of the period between publication of the PRA rules and their implementation and confirmed in the September 2024 policy statement that the implementation date will be moved out by a further six months to 1 January 2026 with a transitional period of 4 years to ensure full implementation by 1 January 2030 in line with the original proposals. The policy statement also confirmed that the SME and infrastructure supporting factor will be removed, however, to ensure overall capital requirements do not increase for SME and infrastructure exposures, the PRA will introduce a new firm- specific structural adjustment to Pillar 2A (the ‘SME lending adjustment’). How the structural adjustment will be managed in practice is currently unclear and the industry is waiting for the PRA to provide further clarification. The PRA have also confirmed that an off-cycle review of firm- specific Pillar 2 capital requirements will be conducted ahead of day 1 implementation. The PRA is conducting a data collection exercise to inform this assessment, which will look to address double counting and unwarranted increases or decreases in capital arising from changes in RWAs as a result of the Basel 3.1 reforms, and plan to apply firm-specific structural adjustments to Pillar 2A to ensure overall capital for SME and infrastructure lending do not increase as result of the removal of the Pillar 1 supporting factors. The deadline for the data collection exercise was 31 March 2025, but this was paused. Once HM Treasury has passed legislation to revoke the relevant parts of the onshored CRR, the PRA will issue a final policy statement, covering the entire Basel 3.1 package. The PRA announced on 17 January 2025 a further delay to the UK implementation of the Basel 3.1 reforms. Following consultations with HM Treasury, the PRA confirmed the implementation date is now scheduled for 1 January 2027, with full compliance still expected by 1 January 2030. The delay is attributed to ongoing uncertainty regarding the timing of the Basel 3.1 implementation in the US and considerations related to competitiveness and growth within the UK banking sector. The PRA have also paused the data collection exercise, originally due by 31 March 2025. The PRA will continue to monitor developments, particularly in the US, and will adjust its approach as necessary. UK leverage ratio framework On 10 September 2024, the PRA confirmed it will be reviewing the leverage ratio requirements thresholds, in line with the commitment made in policy statement 21/21. The leverage ratio is an indicator of a firm’s solvency and the minimum leverage ratio of 3.25% plus buffers is currently only applicable to firms with more than £50 billion retail deposits or £10 billion non-UK assets. Until the review is complete, the PRA are offering a modification by consent to not apply these rules, until the completion of the review. In March 2025 the PRA issued consultation paper 2/25 recommending the retail deposit threshold increase to £70 billion, £20 billion higher than the current threshold. The increase proposed is based on the growth in nominal UK GDP observed between Q1 2016 (point threshold was first applied) and Q2 2024 (latest point in time official statistics were available). No changes are proposed to the £10 billion non-UK asset threshold, which was implemented more recently in 2023. The consultation remains open for comment until 5 June 2025. Pillar 3 disclosure requirement | | | | --- | --- | | | | | Website.svg | The Pillar 3 disclosures for Investec plc and IBP are published in a standalone disclosure report and can be found on the Investec Group’s website. The sub-set of Pillar 3 disclosures the Bank is required to disclose are included in appendix A of this report. | 290 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Capital structure | | | | | --- | --- | --- | | | | | | £’million | 31 March 2025\* | 31 March 2024\* | | Shareholder’s equity | 3 241 | 3 070 | | Shareholder’s equity excluding non-controlling interests | 3 321 | 3 145 | | Foreseeable charges and dividends | (70) | (62) | | Deconsolidation of special purpose entities | (10) | (13) | | Non-controlling interests | — | — | | Non-controlling interests per balance sheet | 1 | 3 | | Non-controlling interests excluded for regulatory purposes | (1) | (3) | | Regulatory adjustments to the accounting basis | (8) | (3) | | Additional value adjustments | (5) | (5) | | Cash flow hedging reserve | (6) | (18) | | Adjustment under IFRS 9 transitional arrangements | 3 | 20 | | Deductions | (663) | (658) | | Goodwill and intangible assets net of deferred taxation | (662) | (652) | | Deferred taxation assets that rely on future profitability excluding those arising from temporary differences | (1) | (2) | | Securitisation positions which can alternatively be subject to a 1 250% risk weight | — | (1) | | Defined benefit pension fund adjustment | — | (3) | | Common Equity Tier 1 capital\*\* | 2 570 | 2 409 | | Additional Tier 1 instruments | 350 | 458 | | Tier 1 capital\*\* | 2 920 | 2 867 | | Tier 2 capital\*\* | 712 | 712 | | Tier 2 instruments | 712 | 712 | | Total regulatory capital\*\* | 3 632 | 3 579 | Risk weighted assets and capital requirements | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Risk weighted assets\*\* | | Capital requirements\*\* | | | £’million | 31 March 2025\* | 31 March 2024\* | 31 March 2025\* | 31 March 2024\* | | | 18 908 | 18 054 | 1 513 | 1 444 | | Credit risk | 15 575 | 15 276 | 1 246 | 1 222 | | Equity risk | 113 | 89 | 9 | 7 | | Counterparty credit risk | 463 | 377 | 37 | 30 | | Credit valuation adjustment risk | 30 | 27 | 2 | 2 | | Market risk | 445 | 428 | 36 | 34 | | Operational risk | 2 282 | 1 857 | 183 | 149 | \*The capital adequacy disclosures for IBP include the deduction of foreseeable charges and dividends when calculating CET1 capital. These disclosures are different to the capital adequacy disclosures included in Investec Group’s year-end results booklet 2025, which follow our normal basis of presentation and do not include this deduction when calculating CET1 capital. IBP’s CET1 ratios would be 37bps (31 March 2024: 34bps) higher, on this basis. \*\*The CET1, Tier 1, Total Capital ratios and RWAs are calculated applying the IFRS 9 transitional arrangements. 291 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | Leverage | | | | | --- | --- | --- | | | | | | £’million | 31 March 2025\* | 31 March 2024\* | | Total exposure measure | 27 906 | 26 746 | | Tier 1 capital\*\* | 2 920 | 2 867 | | Leverage ratio | 10.5% | 10.7% | | Total exposure measure (fully loaded) | 27 903 | 26 726 | | Tier 1 capital (fully loaded) | 2 916 | 2 847 | | Leverage ratio (fully loaded)\*\*\* | 10.5% | 10.7% | Total regulatory capital flow statement | | | | | --- | --- | --- | | | | | | £'million | 31 March 2025\* | 31 March 2024\* | | Opening Common Equity Tier 1 capital | 2 409 | 2 195 | | Dividends paid to ordinary shareholders and Additional Tier 1 security holders | (158) | (110) | | Profit after taxation | 366 | 720 | | Foreseeable charges and dividends | (8) | (26) | | Share-based payment adjustments | — | 5 | | Net equity impact on non-controlling interest movement | 2 | — | | Transaction with equity holders | — | (3) | | Movement in other comprehensive income | (26) | (8) | | Cash flow hedging reserve | 12 | 10 | | Net equity movements in associates and joint ventures | (8) | — | | Goodwill and intangible assets (deduction net of related taxation liability) | (10) | (352) | | Deferred tax that relies on future profitability (excluding those arising from temporary differences) | 1 | — | | Deconsolidation of special purpose entities | 3 | 4 | | IFRS 9 transitional arrangements | (17) | (29) | | Other, including regulatory adjustments and other transitional arrangements | 4 | 3 | | Closing Common Equity Tier 1 capital | 2 570 | 2 409 | | Opening Additional Tier 1 capital | 458 | 250 | | Issued capital | — | 350 | | Redeemed capital | (108) | (142) | | Closing Additional Tier 1 capital | 350 | 458 | | Closing Tier 1 capital | 350 | 2 867 | | Opening Tier 2 capital | 2 920 | 764 | | Issued capital | 712 | — | | Redeemed capital | — | (69) | | Other, including regulatory adjustments and other transitional arrangements | — | 17 | | Closing Tier 2 capital | 712 | 712 | | | | | | Closing total regulatory capital | 3 632 | 3 579 | \*The capital adequacy and leverage disclosures for IBP include the deduction of foreseeable charges and dividends when calculating Common Equity Tier (CET)1 and Tier 1 capital. These disclosures differ from the disclosures included in the Investec Group’s year-end results booklet 2025, which follow our normal basis of presentation and do not include this deduction. IBP’s CET1 ratio would be 37bps (31 March 2024: 34bps) and leverage ratio 25bps (31 March 2024: 23bps) higher, on this basis. \*\*The CET1, Tier 1, Total Capital ratios and RWAs are calculated applying the IFRS 9 transitional arrangements. \*\*\*The CET1 ratio (fully loaded) and the leverage ratio (fully loaded) assumes full adoption of IFRS 9. Capital requirements country-by-country reporting | | | | --- | --- | | | | | Website.svg | HM Treasury has transposed the requirements set out under CRD IV and issued the Capital Requirements Country-by-Country Reporting Regulations 2013. The legislation requires the Bank to publish certain additional information in respect of the year ended 31 March 2025. The country-by-country information can be found on the Investec Group’s website. | 292 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | 69. #### Investec Bank plc Company risk disclosures Investec Bank plc Company follows the Group risk policies and appetite disclosure on pages [45](#i447e4d363cd344738300acdd42f0e3a0_181) to 60 and [248](#i447e4d363cd344738300acdd42f0e3a0_487) to [266](#i447e4d363cd344738300acdd42f0e3a0_499) . The market risk in the trading book is the same at the Group and Company level, the disclosure is made on pages [274](#i447e4d363cd344738300acdd42f0e3a0_514) to [277](#ia4eb1c9c51984900a6f282b3d0da7ae3_0-1-1-1-2494133) . The following tables present the risk disclosures for the Company which are required under IFRS 7. Equivalent Investec Bank plc Group disclosures can be found on page [252](#i447e4d363cd344738300acdd42f0e3a0_493) , page [260](#i447e4d363cd344738300acdd42f0e3a0_496) and page [272](#i447e4d363cd344738300acdd42f0e3a0_508). | | | --- | | | | An analysis of gross core loans, asset quality and ECL | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’million | 31 March 2025 | | 31 March 2024 | | | Loans and advances to customers per the balance sheet | 12 793 | | 12 693 | | | ECL held against FVOCI loans reported on the balance sheet within reserves | (23) | | (14) | | | Net core loans | 12 770 | | 12 679 | | | of which amortised cost and FVOCI (‘subject to ECL’) | 12 257 | | 12 118 | | | of which FVPL | 513 | | 561 | | | Add: ECL | 120 | | 139 | | | Gross core loans | 12 890 | | 12 818 | | | of which amortised cost and FVOCI (‘subject to ECL’) | 12 377 | | 12 257 | | | of which FVPL | 513 | | 561 | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’million | 31 March 2025 | | 31 March 2024 | | | Gross core loans | 12 890 | | 12 818 | | | Gross core loans at FVPL | 513 | | 561 | | | Gross core loans subject to ECL\* | 12 377 | | 12 257 | | | Stage 1 | 10 954 | | 10 766 | | | Stage 2 | 959 | | 1 047 | | | of which past due greater than 30 days | 39 | | 109 | | | Stage 3 | 464 | | 444 | | | ECL | (120) | | (139) | | | Stage 1 | (24) | | (29) | | | Stage 2 | (19) | | (22) | | | Stage 3 | (77) | | (88) | | | Coverage ratio | | | | | | Stage 1 | 0.22% | | 0.27% | | | Stage 2 | 2.0% | | 2.1% | | | Stage 3 | 16.6% | | 19.8% | | | Credit loss ratio | 0.68% | | 0.60% | | | ECL impairment charges on core loans | 83 | | (72) | | | Average gross core loans subject to ECL | 12 317 | | 11 869 | | | An analysis of Stage 3 gross core loans subject to ECL | | | | | | Stage 3 net of ECL | 387 | | 356 | | | Aggregate collateral and other credit enhancements on Stage 3 | 406 | | 387 | | | Stage 3 as a % of gross core loans subject to ECL | 3.7% | | 3.6% | | | Stage 3 net of ECL as a % of net core loans subject to ECL | 3.2% | | 2.9% | | \*Refer to definitions on page [393](#i447e4d363cd344738300acdd42f0e3a0_535) . 293 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | NOTES TO RISK AND CAPITAL MANAGEMENT CONTINUED | | | | | | 69 . #### Investec Bank plc Company risk disclosures #### (continued) | | | --- | | | | An analysis of gross credit and counterparty exposures | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’million | 31 March 2025 | | 31 March 2024 | | | Cash and balances at central banks | 4 175 | | 5 650 | | | Loans and advances to banks | 451 | | 290 | | | Reverse repurchase agreements and cash collateral on securities borrowed | 1 641 | | 1 140 | | | Sovereign debt securities | 1 495 | | 1 077 | | | Bank debt securities | 324 | | 290 | | | Other debt securities | 1 396 | | 1 416 | | | Derivative financial instruments | 300 | | 345 | | | Securities arising from trading activities | 1 | | 13 | | | Loans and advances to customers | 12 891 | | 12 818 | | | Other loans and advances | 3 340 | | 3 312 | | | Other securitised assets | — | | — | | | Other assets | 28 | | 33 | | | Total on-balance sheet exposures | 26 042 | | 26 384 | | | Guarantees | 32 | | 35 | | | Committed facilities related to loans and advances to customers | 2 430 | | 2 279 | | | Contingent liabilities, letters of credit and other | 801 | | 513 | | | Total off-balance sheet exposures | 3 263 | | 2 827^ | | | Total gross credit and counterparty exposures | 29 305 | | 29 211 | | ^Includes the notional exposure to credit risk resulting from credit derivative instruments of £52 million which are newly included in prior year reporting. | | | --- | | | | Analysis of investments | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’million Category | On-balance sheet value of investments 31 March 2025 | | On-balance sheet value of investments 31 March 2024 | | | Unlisted investments | 32 | | 44 | | | Listed equities | — | | — | | | Total investment portfolio | 32 | | 44 | | | Warrants and profit shares | 4 | | 4 | | | Total | 36 | | 48 | | 294 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | | | | --- | | | | 06 | | | ### Sustainability Statement IN THIS SECTION | | | | | | | --- | --- | --- | --- | --- | | | | | | | | 01 | | Introduction | | [296](#i118dad0ceb4f4298bf840dcaa1b17113_803403) | | | | | | | | 02 | | ESRS\* 2: General disclosures | | [296](#i118dad0ceb4f4298bf840dcaa1b17113_803402) | | | BP | Basis of preparation | [296](#i118dad0ceb4f4298bf840dcaa1b17113_803402) | | | GOV | Governance | [297](#i118dad0ceb4f4298bf840dcaa1b17113_803404) | | | SBM | Strategy | [306](#i118dad0ceb4f4298bf840dcaa1b17113_803405) | | | IRO | Impact, risk and opportunity management | [309](#i118dad0ceb4f4298bf840dcaa1b17113_803406) | | | | | | | | 03 | | ESRS E: Environment | | | | | ESRS E1 | Climate change | [321](#id692d188e16a4d9a8634dec099e88221_76) | | | SBM | Strategy | [321](#id692d188e16a4d9a8634dec099e88221_76) | | | IRO | Impact, risk and opportunity management | [321](#id692d188e16a4d9a8634dec099e88221_623540) | | | | EU Taxonomy | [331](#i3887fe0e572e4b24b256e92bc5476776_6079) | | | | | | | | 04 | | ESRS S: Social | | | | | ESRS S1 | Our people | [335](#ie588ca37b98f4c428b70390c95ba5a4c_104) | | | SBM | Strategy | [335](#ie588ca37b98f4c428b70390c95ba5a4c_104) | | | IRO | Impact, risk and opportunity management | [335](#ie588ca37b98f4c428b70390c95ba5a4c_663718) | | | ESRS S4 | Our clients | [343](#i13a712e9cf754173b39d1d43c119468c_19874) | | | SBM | Strategy | [343](#i13a712e9cf754173b39d1d43c119468c_19874) | | | IRO | Impact, risk and opportunity management | [343](#i13a712e9cf754173b39d1d43c119468c_291503) | | | | | | | | 05 | | ESRS G: Governance | | | | | ESRS G1 | Business conduct | [349](#i408f7569c095494f86a844396a50e338_18293) | | | GOV | Governance | [349](#i408f7569c095494f86a844396a50e338_18293) | | | IRO | Impact, risk and opportunity management | [349](#i408f7569c095494f86a844396a50e338_388774) | | | | | | | | 06 | | Directors Responsibility Statement for the Sustainability Statement | | [356](#ic7e53397d6934c23a41b1d00bed4af49_11712) | | 07 | | Independent Practitioner’s Limited Assurance Report to the Directors of Investec Bank plc on the Sustainability Statement | | [357](#i447e4d363cd344738300acdd42f0e3a0_3914) | | 08 | | Appendix | | | | | I | Content index: Reported topics from DMA | [360](#i25d6586203c2442383d3289231a6d4a4_1522) | | | II | EU Taxonomy tables | [363](#id106828438a44cdab7af4b69777ed95f_0-0-1-1-2753111) | \* ESRS: European Sustainability Reporting Standards 295 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | | | | | | | 296 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT | | | | | | | | | --- | | | | | #### General disclosures #### Introduction Investec Bank plc (IBP) falls within the scope of the Corporate Sustainability Reporting Directive (CSRD) due to limited legacy securities issued by IBP being listed on the Euronext Dublin exchange. These securities consist of a nominal value of notes amounting to £72.6 million, issued by a business that is now discontinued. No notes have been issued since 2020. The last of these notes is set to expire in October 2026. While these notes remain tradable, there is currently no active market for them, and transactions only occur when buyers seek to sell the notes back to IBP. While the nominal value of the legacy notes issued is not material to IBP's EU exposure, it's important to note that the CSRD reporting requirements are mandatory regardless of the scale of note issuance within the EU. The disclosures in this report are prepared in accordance with the European Sustainability Reporting Standards (ESRS) and in compliance with the requirements of the EU Taxonomy Regulation. | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | Core areas of activity | | Headcount at 31 March 2025 | | Operating income | | | | 2 Specialist Banking Wealth & Investment | | 2 374 | | £1.16bn | | | | | | | | | | #### Basis of preparation General basis of preparation This Sustainability Statement has been prepared for the first time by IBP in alignment with the European Sustainability Reporting Standards (ESRS), the Transparency (Directive 2004/109/EC) Regulations 2007, as amended and the requirements of the EU Taxonomy Regulation. As 2025 marks the inaugural year of this disclosure, we have not disclosed comparative information in this Sustainability Statement. The scope of the consolidation is the same as the financial statements. Thus, the consolidated quantitative sustainability- related data comprises the parent company IBP and subsidiaries controlled by IBP. Furthermore, no subsidiary undertakings of IBP have been exempted from the consolidated sustainability reporting pursuant to Article 48i of Directive 2013/34/EU. For a list of subsidiaries refer to page [234](#ie6fe0c089cdb4290ae07d8e62bbfa03a_6018). This Sustainability Statement addresses IBP’s upstream, operations, and the downstream value chain. No classified or sensitive information corresponding to intellectual property, know-how or innovation results has been omitted from the Sustainability Statement. We will continue to evolve our practices, to ensure alignment with future regulatory requirements, industry guidance, best practices, and recommendations. The schedules appended to the Sustainability Statement, including the ‘EU Taxonomy Annexures’ and ‘Reported topics from DMA’, form a fundamental part of the Sustainability Statement. Limited assurance has been provided by Deloitte over this Sustainability Statement. For further details, please refer to the Independent Practitioner’s Limited Assurance Report to the Directors of Investec Bank plc on the Sustainability Statement on page [88](#i100a345c65c6429e987680879833e7d3_162970). Disclosure in relation to specific circumstances This Sustainability Statement covers the reporting year 1 April 2024 to 31 March 2025, in line with IBP’s financial year. The time horizons are aligned with the general guiding principles in ESRS 1: • Short term: 0 to 1 year. This corresponds to the reporting period in the financial statements • Medium term: 1 to 5 years. This corresponds to our planning cycle in setting strategic goals. In addition this time frame typically corresponds to economic cycles, regulatory changes and shifts in consumer behaviour, thus capturing the potential impacts of these dynamics on financial performance • Long term: More than 5 years: Financial risks can be influenced by broader economic cycles, which often span several years. This time frame allows Investec Bank plc to account for potential recessions, booms and other macro- economic factors that could impact financial performance. In some cases, the preparation of quantitative metrics requires the use of estimates and assumptions. IBP discloses metrics that incorporate value chain information, which includes both data sourced directly from our clients or investee companies and estimated data derived indirectly through third-party data providers or using sector average. The information provided by third-party data sources may be based on estimation factors that could significantly influence the reported figures. IBP uses indirect sources, estimations and assumptions for metrics relating to our Scope 3 financed emissions, category 15: investments, as defined by the Greenhouse Gas (GHG) protocol. These metrics are subject to a high level of measurement uncertainty due to the limitations in methodologies and data, including the reliance on third-party data. We follow the methodology provided by the Partnership for Carbon Accounting Financials (PCAF) to calculate our Scope 3 emissions. 297 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | For our Scope 3 financed emissions, we are using the PCAF financed emissions standard. This standard provides a specified set of emission factors for various asset classes to estimate emissions from lending and investing activities. Emissions are attributed based on consistent rules specific to each asset class. In accordance with the PCAF standard, IBP’s emissions calculations have been conducted using a combination of methodologies, and each asset class has been analysed individually. More information is available in our Basis of Reporting (BoR) on our website [here](https://www.investec.com/content/dam/investor-relations/financial-information/group-financial-results/2025/Investec-Basis-of-reporting-2025.pdf). For the purposes of this report, we have calculated our financed emissions using exposure values on our balance sheet as at the prior financial year end. This approach enabled a rigorous process to assess data quality, including validating external data and ensuring alignment with industry methodologies. Given the time lag in receiving the best available emissions data from counterparties and third-party providers, using prior year exposures enables a more complete and accurate emissions profile. Furthermore, our financed emissions calculations are subject to an extensive internal governance process, including detailed reviews and approvals to ensure accuracy and integrity prior to disclosure. We expect improvements in data quality and coverage of asset classes in the coming years, driven by increased requirements for data availability as a result of disclosure obligations. New guidance, industry standards and scientific research are anticipated and IBP reserves the right to periodically review and update any targets, methodologies and approaches and to restate baselines as necessary. Refer to the topical disclosures for details on planned actions where applicable. Climate-related targets, actions, and initiatives necessitate a forward-looking approach and long-term perspectives. The forward-looking statements presented reflect the current outlook on future events, grounded in expectations, projections and estimates. These statements carry considerable uncertainty and risk due to several factors, including: • Changes in the political and economic landscape that could materially impact IBP • Economic fluctuations driven by global inflationary pressures, rising interest rates and supply chain disruptions • Potential effects on the global economy and financial markets stemming from geopolitical conflicts • Legislative or regulatory changes affecting IBP's operations or accounting policies • Shifts in business conditions that may significantly influence IBP's operations • Variations in exchange rates and tax rates compared to those prevailing as of 31 March 2025 • Transformations in market structure, client demand or the competitive environment. Moreover, our forward-looking estimates will require ongoing review in light of advancing scientific knowledge, evolving methodologies, variations in standards, future market conditions, technological advancements and regulatory changes. Additionally, we continue to encounter challenges related to data quality and availability, which means these forward-looking estimates should not be regarded as reliable indicators of future performance. Disclosures stemming from other legislation or generally accepted sustainability reporting pronouncements IBP is exempt from the Companies (Strategic Report) Climate- related Financial Disclosures Regulations 2022 reporting requirements in respect of its own strategic report, as the required disclosures are included in the annual report and accounts of its ultimate parent company, Investec plc, available at [www.investec.com](https://www.investec.com/en_za/welcome-to-investec/about-us/investor-relations/integrated-reporting.html). Incorporation by reference This Sustainability Statement is structured into four sections: ‘General’, ‘Environment’, ‘Social’ and ‘Governance’. We have chosen to incorporate some of the corporate governance and strategy disclosures from the cross-cutting standards ESRS 2 in the operational and strategic overview as we believe this information is best read in close connection with our strategic objectives and the overview of activities of IBP (see Sustainability Statement content index on page [360](#i25d6586203c2442383d3289231a6d4a4_1333)). #### Governance Our commitment to sound corporate governance is deeply ingrained in our values, culture, processes and organisational structure. We expect our directors and employees to consistently demonstrate uncompromising moral strength. Composition and diversity of the Board The composition, diversity and experience of our Board is shown on page [68](#i8f0a10dffafc44b2b58586afe778cb52_0-0-1-1-2664967). The Board and its committees collectively possess a broad range of skills, experience and knowledge. Independence, tenure and membership are regularly considered. The annual effectiveness review of the Board and the individual directors considers overall composition, diversity, effectiveness and contribution (read more on page [71](#idf922759f58849e78a06d7559b0d8994_8826)). Number of Executives: Four Number of non-executives: Seven (including the Chair) Employee representation: IBP ensures that employees are present in Board meetings whenever significant sustainability topics are discussed. Key leaders, including the Chief Strategy and Sustainability Officer, Chief Risk Officer, Global Head of People and Organisation (P&O), Global Head of Digital and Technology, and Head of Compliance attend relevant Board and Board sub-committee meetings, ensuring that diverse perspectives are included in sustainability decision-making. Governance and oversight of impacts, risks and opportunities (IROs) Ensuring effective governance through a well-disciplined and diverse Board is essential to supporting our strategic objectives. Sustainability considerations are integrated into a multidisciplinary, company-wide management process throughout the Investec Group and IBP. IBP has various Board and Executive committees that have oversight of sustainability- related matters. The Board takes ultimate responsibility for the material IROs that have been identified in the double materiality assessment (DMA). The table below provides a summary of how often and by whom our Board, Board committees and Executives are informed about material IROs as well as the material IROs each of the committees address. 298 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | | --- | --- | --- | | | | | | IBP Board | | | | The Board plays a crucial role in providing strategic leadership and governance to ensure the Bank’s long-term success and integrity. The Board is responsible for setting and overseeing the implementation of the Bank’s strategic direction, ensuring that business objectives align with the Bank’s mission and values. The Board, comprising both Executive and non-executive directors, has the accountability over all material sustainability topics of the Bank. Updates are presented either verbally or in written format from various IBP Executive committees and Investec Group Board committees. The Board met seven times during the year. Throughout the year, the Board addressed a range of material topics, including energy transition finance, in preparation for approving the Bank’s sustainable and transition finance targets. Additionally, the Board annually reviews the Bank’s People & Organisation (P&O) strategy, presented by the Global Head of P&O, which covers corporate culture, employee rights, diversity, and employee mental health and wellbeing. Employee remuneration is managed through the IBP Remuneration Committee, with reports presented to the Board at every meeting and pay gap reports reviewed annually before publication. Key issues such as data privacy and cyber security, client engagement, as well as corruption and bribery related to financial crime, are escalated to the Board through the IBP Board Risk and Capital Committee (IBP BRCC). Whistleblowing matters are addressed annually, with information provided by the IBP Audit Committee. Furthermore, the Head of IBP Compliance also presents detailed, consolidated compliance management information through the IBP BRCC to the Board. Material IRO responsibility | | | | E1: Climate change • Energy transition finance activities • Fossil fuel financing | S1: Our people • Employee remuneration • Employee rights • Diversity • Employee mental health and wellbeing S4: Our clients • Data privacy • Cyber security • Client engagement and marketing | G1: Business conduct • Corporate culture • Protection of whistleblowers • Corruption and bribery • Regulatory and legal compliance | The Board is supported by various Board and Executive committees that oversee elements relating to the material IROs where they have the skills and knowledge. The tables below explain these committees and their responsibility in terms of specific IROs. 299 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | IBP Board-level committees | | | | | --- | --- | --- | | | | | | IBP Board Risk and Capital Committee (IBP BRCC) | | | | The IBP BRCC is mandated by the Board. This Committee met eight times during the year. This Committee, comprising non-executive directors, is tasked with reviewing the various risks faced by the Bank, including sustainability risk. The IBP BRCC fulfils this responsibility by evaluating the risk reports presented to them and assessing whether the actions taken by management are appropriate. This Committee receives updates from the DLC IT Risk and Governance Committee (DLC ITRGC) and the IBP Executive Risk Committee (IBP ERC) either in written or verbal format on an ad hoc basis. During the financial year, the IBP BRCC concentrated on several key material topics. This included assessing the outcomes of the Bank of England's climate scenario testing and capital stress tests to evaluate the resilience of IBP’s business model and strategy. Additionally, the IBP BRCC approved the Bank’s sustainable and transition finance targets. In the area of client engagement, the IBP BRCC receives two comprehensive annual reports, along with five updates each year from the compliance team that address conduct matters such as complaints, breaches, regulatory interactions and employee development. Issues related to data privacy and cyber security are escalated to the IBP BRCC by the DLC ITRGC, while corruption and bribery matters are reported by the Money Laundering Reporting Officer (MLRO). Furthermore, the IBP BRCC reviewed all sustainability-related policies and the Bank’s risk appetite, including those specific to sustainability risks. The IBP BRCC approved the sustainable and transition finance target relating to the IRO of energy transition finance activities and reviewed IBP’s exposure to fossil fuel financing. Material sustainability-related matters are reported to the IBP BRCC on a regular basis and the MLRO reports annually to the IBP BRCC and to the Board. Material IRO responsibility: | | | | E1: Climate change • Energy transition finance activities • Fossil fuel financing | S4: Consumers and end-users • Client engagement and marketing • Data privacy • Cyber security | G1: Business conduct • Corruption and bribery | | | | | | IBP Audit Committee | | | | The IBP Audit Committee is mandated by the Board to be the Audit Committee for the Bank. This Committee met seven times during the year. This Committee, comprising non-executive directors, oversees and considers all audit-related matters for the Bank. Material topics in the financial year included status updates on the CSRD disclosure obligations and overseeing the Bank’s progress in implementing these requirements. An annual whistleblowing report is presented to both the IBP Audit Committee and the Board to ensure that controls remain effective. Additionally, the whistleblowing policy is approved by the IBP Audit Committee and the Board. Updates on any whistleblowing matters are incorporated into the P&O reports presented to the Board twice annually. Furthermore, they consider findings from external audits relating to financed emissions, fossil fuel financing, energy transition finance, and our sustainable and transition finance targets. The IBP Audit Committee reports material accounting-related sustainability matters to the Board. Material IRO responsibility: | | | | G1: Business conduct • Protection of whistleblowers | | | 300 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | IBP Executive-level committees | | | | | --- | --- | --- | | | | | | IBP Executive Risk Committee (IBP ERC) | | | | The IBP ERC is mandated by the Board. This Committee meets on a weekly basis. This Committee, comprising IBP Executives, assists in determining and managing the categories of risk (which includes sustainability- related risk and the relevant IROs), the specific risks and the extent of such risks undertaken by the Bank. The Committee receives updates from the various business and risk teams within the Bank. During the year they approved the sustainable and transition finance targets in relation to energy and transition finance activities. Furthermore the Committee reviewed IBP’s financed emissions and also has oversight on activities within fossil fuel financing. The IBP ERC reports material sustainability-related matters to the Board and to IBP BRCC. Material IRO responsibility: | | | | E1: Climate change • Energy transition finance activities • Financed emissions • Fossil fuel financing | | | | | | | | IBP Sustainable Business Forum (IBP SBF) | | | | The IBP SBF is mandated by the IBP Executives. This forum meets on a fortnightly basis. This forum, comprising business unit representatives, management and Executives of the Bank plays a crucial role in enabling knowledge sharing, fostering collaboration and identifying sustainability-related commercial opportunities. Furthermore, this forum coordinates sustainability projects within the Bank such as setting sustainable and transition finance targets. Material topics addressed in this financial year included energy transition finance and specifically the finalisation of the sustainable and transition finance target. The IBP SBF reports material sustainability-related matters through the Chair of the IBP SBF to the DLC Executive Sustainability Committee (DLC ESC) and where relevant to IBP ERC, IBP BRCC and the Board. Material IRO responsibility: | | | | E1: Climate change • Energy transition finance activities | | | 301 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Investec Group (DLC) Board-level committees The Board is also supported by the Investec Group Board, Executive and management committees on the Investec Group level. These committees and management and administrative functions are detailed below. | | | | | | --- | --- | --- | --- | | | | | | | DLC Social and Ethics Committee (DLC SEC) | | | | | The DLC SEC is mandated by the Investec Group Board. This Committee met four times during the year. This Committee comprising both Executive and non-executive directors, has accountability for monitoring the Investec Group’s performance in terms of sustainability-related matters. The principal objective of the DLC SEC is to assist the Investec Group Board in ensuring that the Investec Group remains a committed, socially responsible corporate citizen in the context of the economy, society, and environment in which the Investec Group operates. Material topics discussed in the financial year included energy transition finance activities by approving Investec Group’s sustainable and transition finance targets and reviewing the Investec Group’s financed emissions and fossil fuel financing. Additionally, the Global Head of P&O, who is a member of the Committee presents all significant matters relating to [S1 - Our people](#ie588ca37b98f4c428b70390c95ba5a4c_104) to this Committee as needed. This Committee also evaluates the Investec Group’s client engagement and marketing strategies to mitigate the risk of greenwashing. Furthermore, matters relating to corporate culture are presented by the Global Head of P&O on an ad hoc basis. The Committee receives feedback on sustainability matters verbally at every meeting from the Chief Strategy and Sustainability Officer and on an ad hoc basis from the Global Head of P&O. The DLC SEC reports material sustainability-related matters to the Board and to the Investec Group Board. Furthermore, material topics relating to the Bank are escalated by the IBP Chief Risk officer (who is a member of this Committee) to the Board. Material IRO accountability: | | | | | E1: Climate change • Energy transition finance activities • Financed emissions • Fossil fuel financing | S1: Our people • Employee rights • Diversity • Employee mental health and wellbeing S4: Our clients • Client engagement and marketing | G1: Business conduct • Corporate culture • Regulatory and legal compliance | | | | | | | | DLC IT Risk and Governance Committee (DLC ITRGC) | | | | | The DLC ITRGC is mandated by the Investec Group Board Risk and Capital Committee (DLC BRCC). This Committee meets quarterly. This Committee comprising non-executive and Executive Directors. Two non-executive members of the IBP Board are also members of the DLC ITRGC. This Committee oversees the sound governance of technology and management of risk inherent in the use of information technology (IT), which includes ongoing oversight of technical, data privacy and cyber security, and operational risks. The objective of the Committee is to review, assess, prioritise the response to, and monitor current and emerging technology risk as well as to track the strategic alignment of IT and business. Feedback on material sustainability-related matters is presented verbally by the digital and technology teams within the Group. A report of all matters considered is included in the IBP BRCC meeting papers. The DLC ITRGC reports material matters to the IBP BRCC and the DLC BRCC. Material IRO responsibility: | | | | | S4: Consumers and end-users • Data privacy • Cyber security | | | | 302 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Investec Group (DLC) Executive-level committees | | | | | --- | --- | --- | | | | | | DLC Executive Sustainability Committee (DLC ESC) | | | | The DLC ESC is mandated by the Investec Group's Executive Directors. This Committee met six times during the year. This Committee comprising Executives and employees with subject matter expertise and is mandated to align and coordinate the sustainability strategy and governance efforts across geographies and businesses. Key members include the Group Chief Risk Officer, Global Head of P&O, the IBP Chief Risk Officer serving as the Senior Management Function (SMF) for climate risk at the Bank and the Chair of the IBP SBF. Key sustainability-related issues identified by the business and forums are escalated to the Chief Strategy and Sustainability Officer, who presents them both verbally and in written form at each DLC ESC meeting and in specific matters relating to [E1 - Climate change](#id692d188e16a4d9a8634dec099e88221_76). Additionally, the Global Head of P&O provides verbal updates on significant social matters on an ad hoc basis, while the IBP SBF verbally presents any sustainable and transition finance initiatives as needed. The DLC ESC reports significant sustainability matters to the DLC SEC, the IBP Chief Risk Officer escalates pertinent issues directly to the Board, and the Global Head of P&O forwards material matters relating to [S1 - Our people](#ie588ca37b98f4c428b70390c95ba5a4c_104) to the Board. Material IRO responsibility: | | | | E1: Climate change • Energy transition finance activities • Financed emissions • Fossil fuel financing | S1: Our people • Employee rights • Diversity • Employee mental health and wellbeing S4: Our clients • Client engagement and marketing | G1: Business conduct • Corporate culture • Regulatory and legal compliance • Transparency and disclosure | | | | | | The Chief Strategy and Sustainability Officer | | | | The Chief Strategy and Sustainability Officer is instrumental in steering the Bank's approach to both strategic and sustainability matters by providing leadership and strategic direction. By embedding sustainability into the core business strategy, this role ensures that sustainability considerations are integrated into the decision-making processes throughout the Group. This encompasses identifying opportunities for sustainable growth, managing risks related to environmental and social factors, and cultivating a culture of sustainability among our employees. Furthermore, the Chief Strategy and Sustainability Officer collaborates with various teams to design and implement initiatives aligned with our sustainability objectives, such as establishing sustainable and transition finance targets and incorporating sustainability into our commercial activities. | | | | As a member of the DLC and Chair of the DLC ESC, the Chief Strategy and Sustainability Officer is central to the governance structure, receiving feedback from the Group sustainability team and the IBP SBF. | | | | The Chief Strategy and Sustainability Officer escalates any sustainability-related matters raised by the DLC ESC verbally to the DLC SEC. | | | Supporting function | | | --- | | | | The Group sustainability team | | The Group sustainability team is tasked with assessing and reporting on sustainability, escalating relevant matters to the risk teams and supporting them in identifying sustainability risks that may impact the Bank and the Investec Group. They also define sectoral policies to mitigate these risks, ensure compliance with regulatory disclosure requirements, and support business units on sustainability opportunities relating to products and services. This enables IBP to manage and oversee its sustainability IROs across all businesses and geographies. Additionally, the Group Sustainability team plays an integral role in monitoring the sustainable and transition finance targets set for 2030. The Group sustainability team escalates any material sustainability topics to the Chief Strategy and Sustainability Officer. | 303 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Management’s role in the governance of controls and procedures to manage and oversee IROs We are committed to ensuring that our dedicated sustainability controls and procedures are effectively integrated with other internal functions. The Bank, in keeping with sound governance practices, has defined roles and responsibilities for the management of risk in accordance with the three lines of defence model, i.e. business line management, an independent risk function and an independent internal audit function. In addition, to manage the Bank’s risk appetite, there are a number of detailed statements, frameworks, policies and governance structures in place. Overall, the Board ensures that there are appropriate resources in place to manage the risks arising from running the business by having independent risk management, compliance and financial control functions. These are supplemented by an Internal Audit function that reports independently to the non- executive Audit Committee Chair. Controls and procedures relating to sustainability are integrated across our three lines of defence model. Business line management: • Revenue writing business functions: Continued collaboration exists between the Group sustainability team and the revenue writing business units. This collaboration is facilitated through cross-departmental committees and joint initiatives, like the IBP SBF, that promote the sharing of insights and best practices. In particular, this forum focuses on commercial activities within [E1 – Climate change](#id692d188e16a4d9a8634dec099e88221_76) in relation to energy transition finance, through setting and monitoring our progress towards our sustainable and transition finance target. Sustainability controls and procedures related to transition finance, including the establishment of our sustainable and transition finance targets, are managed by the management teams within each revenue-generating business • People & Organisation (P&O): Our P&O team takes accountability for actioning and monitoring our material IROs within [S1 – Our people](#ie588ca37b98f4c428b70390c95ba5a4c_104), which includes employee mental health and wellbeing, diversity, employee remuneration and employee rights. The Board has delegated the responsibility of monitoring Board diversity targets to the IBP Nomination Committee, which reviews the composition of the Board at each of its meetings. Progress on diversity targets is escalated to the Board by the P&O team. Assessments of mental health and wellbeing, employee remuneration and employee rights are escalated to the Board as and when required • Marketing: The marketing function is responsible for the material matters identified in [S4 – Our clients,](#i13a712e9cf754173b39d1d43c119468c_19874) pertaining to client engagement and marketing. This responsibility encompasses the processes and controls established for external client communications related to sustainability claims, with oversight provided by the Group sustainability team, the legal team and the compliance team • Technology and security: The technology function is responsible for implementing and operating the necessary control for the material matters identified in [S4 – Our clients](#i13a712e9cf754173b39d1d43c119468c_19874) relating to data privacy and cyber security. This function creates standards for consistent deployment and management of the Group’s technology systems and prioritises corrective action where necessary and ensure the timely implementation thereof. The Investec Group security team maintains and monitors the operational effectiveness of the Investec Group’s (which includes the Bank) approved security tools, defines the security architecture, and associated security standards, and conducts technology security evaluations/penetration testing while coordinating the security incident response • All business functions: With regard to [G1 – Business conduct](#i408f7569c095494f86a844396a50e338_18293), the management within all business functions and our employees are responsible for ensuring they act according to the Principles of Conduct. The Board is responsible for overseeing significant matters that may compromise our business conduct and receives reports on corporate culture, whistleblowing, and corruption and bribery when breaches occur. Independent risk and operational risk function: • Operational risk: Our independent operational risk function ensures that policies related to material matters are upheld and that awareness is promoted throughout the Bank. Additionally, they monitor and challenge business management's application of, and compliance with, these policies, escalating any significant non-compliance to the relevant risk committees • Risk management: The risk management function is responsible for managing our commitments within [E1 –](#id692d188e16a4d9a8634dec099e88221_76) [Climate change](#id692d188e16a4d9a8634dec099e88221_76) in relation to financed emissions and fossil fuel financing supported by the Group sustainability team. Our progress around our commitment to reducing fossil fuel financing is regularly reviewed by the risk management function and reported to the Board, IBP ERC and the IBP BRCC. On an annual basis, the financed emissions from our lending and investing activities are assessed and presented to IBP ERC and the Board. 304 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Independent internal audit function: The internal audit function conducts annual reviews of the control environment across all functions, assessing whether key risks are adequately managed and aligned with management’s risk appetite. As part of their audit activities, they test the implementation of policies and report any exceptions or instances of non-compliance to the IBP Audit Committee. The Board believes that management systems and processes, supported by the conclusions of the Internal Audit function and the results of their combined assurance coverage through each assurance function, are adequate to support IBP’s strategy and allow the Bank to operate within its risk appetite framework. Governance of target-setting The Board, DLC SEC and DLC ESC, along with senior executive management, are accountable for monitoring the progress against establishing sustainability-related targets for material IROs. Approval for these targets is granted by the Board and the DLC SEC while the DLC ESC ensures alignment with the overall Investec Group sustainability strategy. Sustainability-related skills of the Board and Executives A fundamental aspect of governance is ensuring the effectiveness of the Board in fulfilling its responsibilities. The composition of the Board has been designed to ensure that they have the appropriate mix of knowledge, skills, experience, independence and diversity. Consideration is given towards the collective skills, knowledge and experience of the directors when assessing the overall composition and suitability of the Board. In addition to a range of skills, the Board also values the innate differences in approach and thinking styles that result from the varied backgrounds and experiences of our directors. Recognising any gaps, the Board seeks to invest in continuous professional development by providing targeted development programmes, workshops and access to expert consultations to enhance the sustainability knowledge of all directors through the directors’ development plan. Regular performance reviews are conducted to monitor progress, ensuring that the Board remains well equipped to address emerging sustainability challenges. The Board leverages the robust in-house expertise of teams managing key sustainability matters alongside its members' specialised knowledge. These in-house teams bring deep expertise in areas such as environmental management, social responsibility, renewable energy and corporate governance, providing comprehensive insights into sustainability matters. For complex or emerging challenges, the Board accesses external experts, ensuring a blend of internal strengths and external resources. Additionally, the Board fosters continuous enhancement of expertise within the Bank through collaboration and professional development. To enhance their expertise, the Board has participated in development sessions over the past year centred on key sustainability topics as part of the annual directors' development plan and through in-depth deep-dive sessions. Each year, the Board engages in a comprehensive deep dive into the P&O strategy. Additionally, during the year, a specialised session on energy transition finance was conducted to address the Bank’s sustainable and transition finance targets, including fostering an understanding of financed emissions. These initiatives are designed to build the Board’s capacity to effectively understand and oversee the Bank’s material sustainability matters. Consideration of IROs in relation to strategy and business activities All material IROs have already been effectively integrated into the relevant business and operational functions within the Bank. Importantly, these material IROs do not change our current strategy or business activities, as we have consistently adopted an integrated approach to sustainability for many years. We incorporate sustainability considerations into our daily operations and decision-making processes to support a sustainable, long-term vision. Our commitment to sustainability is deeply ingrained in our operations and business practices, enabling us to manage these IROs effectively without requiring adjustments to our established strategic direction. Integration of sustainability-related performance into incentive schemes We have established sustainability-related performance measures for the Executive Directors of the Investec Group, which can be found in the 2025 remuneration report on our website. Our intention is to establish an incentive framework for the Executives of IBP that integrates sustainability-related performance metrics into Executive remuneration. 305 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Statement on due diligence IBP is committed to implementing comprehensive governance practices that ensure effective oversight of sustainability-related risks and opportunities. | | | | | --- | --- | --- | | | | | | Core elements of due diligence | References to the Sustainability Statement | Pages | | a) Embedding due diligence in governance, strategy and business model | • ESRS 2 GOV-2 – Sustainability matters managed by IBP’s committees and leadership teams • ESRS 2 SBM-3 – Material IROs | [297](#i118dad0ceb4f4298bf840dcaa1b17113_607614) [314](#i118dad0ceb4f4298bf840dcaa1b17113_804227) | | b) Engaging with affected stakeholders in all key steps of the due diligence | • ESRS 2 SBM-2 – Interest and views of stakeholders • ESRS 2 IRO-1 – Process to identify IROs • ESRS S1 – Our people • ESRS S4 – Our clients | [308](#i118dad0ceb4f4298bf840dcaa1b17113_142750) [309](#i118dad0ceb4f4298bf840dcaa1b17113_236355) [337](#ie588ca37b98f4c428b70390c95ba5a4c_618741) [344](#i13a712e9cf754173b39d1d43c119468c_291504) | | c) Identifying and assessing adverse impacts | • ESRS 2 IRO-1 • ESRS 2 SBM-3 | [309](#i118dad0ceb4f4298bf840dcaa1b17113_804228) [306](#i118dad0ceb4f4298bf840dcaa1b17113_804229) | | d) Taking actions to address those adverse impacts | • ESRS E1 – Climate change • ESRS S1 – Our people • ESRS S4 – Our clients • ESRS G1 – Business conduct | [321](#id692d188e16a4d9a8634dec099e88221_76) [335](#ie588ca37b98f4c428b70390c95ba5a4c_104) [343](#i13a712e9cf754173b39d1d43c119468c_19874) [349](#i408f7569c095494f86a844396a50e338_18293) | | e) Tracking the effectiveness of these efforts and communicating | • ESRS E1 – Climate change • ESRS S1 – Our people • ESRS S4 – Our clients • ESRS G1 – Business conduct | [321](#id692d188e16a4d9a8634dec099e88221_76) [335](#ie588ca37b98f4c428b70390c95ba5a4c_104) [343](#i13a712e9cf754173b39d1d43c119468c_19874) [349](#i408f7569c095494f86a844396a50e338_18293) | Risk management and internal controls over sustainability reporting The Group sustainability team oversees sustainability-related disclosures and ensures alignment with strategic objectives, while the IBP compliance team monitors current and emerging regulatory requirements which are escalated to the Group sustainability team. Additionally, collaboration with the IBP risk management teams ensures that sustainability risks are considered within the broader enterprise risk management framework, and input from various business units helps to provide accurate and comprehensive reporting on sustainable and transition finance risks and opportunities. • Internal controls in the compliance function: When changes to sustainability regulation occur, the compliance team communicates these matters to the Group sustainability team. The sustainability team then evaluates the new requirements, conducts gap analyses against existing policies and disclosures, and implements the necessary policy or disclosure updates • Decentralised collection of data relating to material matters: Information on material sustainability-related matters is collected across various functions, including the Group sustainability team, the compliance team, risk management, P&O, technology functions and different revenue-generating business units. Each function evaluates the data collected relating to the IROs within its area of responsibility, ensuring an understanding of the operational, financial and reputational risks associated with its respective IROs. These teams are tasked with ensuring that accurate information is signed off by senior management within each area before communicating the information to be reported to the Group sustainability team • Centralised sustainability reporting through the Group sustainability team: The Group sustainability team is responsible for ensuring the accuracy, consistency and transparency of sustainability reporting. They consolidate, analyse and scrutinise the sustainability-related information received from various business and operational functions, and verify that reliable and consistent disclosures concerning sustainability matters are reported in line with the relevant regulations • Executive oversight: Sustainability reports, including reporting in accordance with the CSRD requirements, are reviewed and approved by Executives and the DLC SEC before public disclosure, providing a layer of governance and oversight • Limited and reasonable assurance through external audit: The sustainability report undergoes a comprehensive external assurance process at year end. We obtain limited assurance on this Sustainability Statement and both reasonable and limited assurance on selected key performance indicators (KPIs) in our Investec Group sustainability report. The primary risk identified in previous years by the assurance provider at the time was the manual calculation of Scope 3 financed emissions. We have recently completed the automation of our Scope 3 financed emissions calculations, which eliminates errors associated with manual input and accelerates the reporting process. Although there were other primary risks identified they were not related to our material IROs. Furthermore, we are in the process of operationalising the collection of sustainable and transition finance activities by modifying our source systems, thereby improving our ability to report reliable data. Any findings related to sustainability-reporting are reviewed by Internal Audit and where required escalated to the Board, Executives, the IBP Audit Committee, DLC SEC and DLC ESC. 306 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Strategy Strategy, business model and value chain Our sustainability strategy is intrinsically linked to our overarching purpose of creating enduring worth for all stakeholders. By integrating sustainability into our core business practices, we aim to deliver long-term value that transcends financial performance, fostering resilience in both our operations and the clients we serve. Our commitment to sustainable finance not only supports our clients in their transitions to greener practices but also aligns with our goal of promoting economic, social and environmental wellbeing. We aim to enhance our ability to generate lasting impact, ensuring that our business contributes positively to society while securing a sustainable future for generations to come. Our business model, and operational and strategic overview are disclosed on pages [2](#i62da4a2ef6674819926dae64721f9e71_282) to [10](#i447e4d363cd344738300acdd42f0e3a0_3848290701077) of this report. Our sustainability strategy applies to all geographies and business activities within IBP. Central to our purpose to create enduring worth is the belief that sustainability is integral to our business. Our commercial strategies work with a multiple-stakeholder perspective from inception and we are conscious about the impact they make in the world. Addressing two impact Sustainable Development Goals (SDGs) being reduced inequality (SDG 10) and climate change (SDG 13) is fundamental to our sustainability strategy. These two impact SDGs are supported by six additional SDGs. Collectively, these priority SDGs reflect our strategy to fund stable and sustainable economies across multiple regions. Business model For information on our clients and offerings, refer to page [10](#i447e4d363cd344738300acdd42f0e3a0_3848290701077). Our strategic objectives are disclosed on page [9](#i447e4d363cd344738300acdd42f0e3a0_58) and the overview of our activities on page [10](#i447e4d363cd344738300acdd42f0e3a0_3848290701077). We have market-leading, distinctive client franchises. The Investec distinction is embodied in our entrepreneurial culture, supported by a strong risk management discipline, client- centric approach and an ability to be nimble, flexible and innovative. We do not seek to be all things to all people. Our aim is to build well-defined, value-adding businesses focused on serving the needs of select market niches where we can compete effectively and build scale and relevance. Our unique positioning is reflected in our iconic brand, our high-touch and high-tech approach and our positive contribution to society, macro-economic stability and the environment. Ours is a culture that values purposeful thinking and stimulates extraordinary performance. We take pride in the strength of our leadership team; our people are empowered and committed to our values and culture. Our inputs and outputs are shown below. | | | | | | --- | --- | --- | --- | | | | | | | | | Our inputs | Our outputs | | | | | | | | Financial capital | Our shareholder and debt funding, which underpin our strong capital base, support our business operations and fund growth | Our capacity to deliver sustainable financial performance, support investment in sustainable and transition finance, new products and initiatives, and enable resilient capital allocation | | | | | | | | | | | | | Human capital | Our culture, our people, their collective knowledge, skills and experience as well as our ethical and effective leadership, collectively facilitate the delivery on our purpose to create enduring worth | Our ability to attract, retain, and develop skilled and purpose-driven people, enabling innovation, client service excellence and the long-term success of the Bank. This relates to our IROs: • S1 – Our people: diversity, employee mental health and wellbeing, and employee rights • GI – Business conduct: corporate culture | | | | | | | | | | | | | Natural capital | Our efforts to actively manage the impact of our operations on the environment | Our efforts to minimise environmental impact, finance the transition to a low-carbon economy, and integrate environmental risks and opportunities into decision-making. This relates to our IRO: • E1 – Climate change: energy transition finance activities, finance emissions and fossil fuel financing | | | | | | | | | | | | | Social and relationship capital | Our strong relationships with all our stakeholders are an integral part of our operating environment and our objective to live in society, not off it | Our trusted stakeholder relationships, client satisfaction and strategic partnerships that reinforce our social licence to operate and support inclusive growth. This relates to our IROs: • S4 – Our clients: data privacy • G1 – Business conduct: protection of whistleblowers, corruption and bribery, transparency and disclosure and, regulatory and legal compliance | | | | | | | | | | | | | Intellectual capital | Our trusted brand and franchise value, strategic partnerships and innovative capabilities and expertise | Our ability to develop proprietary systems, client insights and differentiated capabilities that enhance competitive advantage and contribute to sustainable value creation. This relates to our IRO: • S4 – Our clients: cyber security | | | | | | | | | | | | | Manufactured capital | The physical and digital infrastructure through which we conduct business activities | Our efforts towards efficient use and enhancement of physical and digital infrastructure to support operational resilience, client delivery and innovation through technology capabilities. | | | | | | 307 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Products and services relating to our material IROs IBP offers a comprehensive range of products and services tailored to distinct customer groups across significant markets. For our sustainability-focused activities we are guided by our [Sustainable and Transition Finance Classification Framework](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/Investec-Sustainable-and-Transition-Finance-Classification-Framework.pdf), which supports both environmentally and socially sustainable commercial initiatives. Our sustainability-focused products and services reflect our ambition to achieving our sustainability-related goals, particularly our target to facilitate £14.9 billion for IBP in sustainable and transition finance by 2030. Private Client Banking activities: Our Private Client Banking division provides high-touch and high-tech solutions such as transactional banking, lending, private capital, savings and foreign exchange services specifically designed for high net worth (HNW) private clients. These offerings cater to active wealth creators with annual incomes exceeding £300 000 and net asset values above £3 million, primarily serving clients in the UK and the Channel Islands. Sustainability-related products for this group primarily involve mortgage lending, focusing on financing higher Energy Performance Certificate (EPC)-rated properties and electric vehicles (EVs). This lending supports our efforts in energy transition finance and in addressing financed emissions, specifically targeting E1 – Climate change. Corporate and Investment Banking activities: In our Corporate and Investment Banking activities, we deliver client- centric and solution-driven services, including lending, treasury and risk management solutions, advisory and institutional research, as well as sales and trading. This division serves a broad spectrum of clients, including corporate, private, intermediary, government, and institutional entities across the UK, Europe, Channel Islands, the USA, and India. Typically, sustainability-related lending is structured as sustainability-linked loans, where key loan terms, including adjustments in the interest rate, are tied to the borrower’s achievement of specific sustainability targets. This structure incentivises companies to enhance their sustainability performance. Additionally, lending can be classified as sustainable finance based on the company’s profile if 90% of its revenues are derived from sustainable activities or if the proceeds are specifically allocated to sustainable environmental or social initiatives (as recommended by the EU Sustainable Finance Disclosure Recommendations. These products focus on addressing E1 – Climate change. Sustainability-related products and services for our Corporate and Investment Banking clients include: • Lending to properties: Within our real estate business, we provide loans to properties with A and B graded EPC ratings to promote energy efficiency. For properties with lower EPC ratings, we look to finance energy-efficiency upgrades that improve the EPC ratings to A or B • Supporting renewable projects: In our Energy and Infrastructure business, we support projects that utilise renewable sources such as wind, solar, battery storage, renewable natural gas and EV infrastructure, along with digital infrastructure initiatives • Sustainable funding solutions: Through our Direct Lending portfolio, we seek opportunities for sustainable funding solutions. Our Fund Solutions offering includes lending to Article 9 funds, which, by definition, have sustainable investment as their objective. We endeavour to finance socially sustainable activities that have defined social outcomes and impacts from Investec's financial intervention, such as access to essential services and economic empowerment • Financing environmentally sustainable solutions: In our asset finance business, we support clients with financing for a variety of environmentally sustainable solutions, including EVs, renewable energy generation, energy-efficiency technologies, and recycling activities • Managing fossil fuel exposures: We manage our fossil fuel exposures in accordance with our fossil fuel policy to address E1 – Climate change – fossil fuel financing. Additionally, in pursuit of influencing our clients and suppliers to decarbonise, we emphasise thought leadership strategies by identifying suitable partnerships with external small and medium-sized enterprises (SMEs) to help clients achieve their sustainability objectives. To enable this, we prioritise upskilling and educating our employees to promote sustainable finance options for clients across the Bank. Our value chain IBP operates as a specialist bank, with wealth management services offered through the long-term strategic partnership with Rathbones. Investec has an international footprint, providing financial services across the UK, Channel Islands, Europe, the USA and India. To comprehensively capture IROs, our DMA) conducted during the financial year ended 31 March 2024 focused on the most significant activities, services, and products in our value chain. In 2025, the DMA underwent the appropriate governance processes to ensure its robustness and relevance. Our upstream value chain consists of: • Suppliers of goods and services • Regulators, sustainability-related analysts and data providers with whom we engage to ensure that our strategy, risk management principles, and sustainability disclosure requirements are aligned with regulatory compliance and best practice approaches • Capital providers, institutional investors and financial markets who supply the funding and liquidity necessary to support our banking, lending and investment activities. Our downstream value chain includes: • Corporate, private, intermediary, government and institutional clients to whom we provide specialist banking solutions including lending, treasury and risk management solutions, advisory, institutional research, and sales and trading • HNW private clients to whom we provide products relating to lending, private capital, transactional banking, savings and foreign exchange. As a financial institution, our primary business activity influencing sustainability matters will be our lending and investment activities. Through our sustainable and transition financing activities, we play a critical role in facilitating capital flows, enabling economic growth, and supporting the transition to a low-carbon and more inclusive economy. 308 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Activities, products and services | | | | Underlying actors | | Location | | | | | | | | | | | | | | | | | | | | | | | | | | Upstream | | | Supply chain and third-party providers | | | Procure goods and services, including energy, equipment and technology solutions | | | | Suppliers of goods and services | | UK and Europe Channel Islands USA | | | India South Africa | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Sustainability-related disclosures according to regulatory and best practice requirements | | | | Regulators Sustainability-related analysts and data providers | | UK and Europe | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Provision of capital | | | | Institutional investors Retail depositors | | UK and Europe USA | | | South Africa | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Own operations | | | Own operations | | | Our premises Our client offerings | | Our business enablement functions | | Our employees | | UK and Europe Channel Islands USA | | | India South Africa | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Downstream | | | Private Client Banking activities | | | Lending Private capital Transactional banking | | Savings Foreign exchange | | HNW private clients | | UK and Europe Channel Islands | | | South Africa Mauritius | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Corporate and Investment Banking activities | | | Lending Treasury and risk management solutions | | Advisory, institutional research, sales and trading | | Corporate, private, intermediary, government and institutional clients | | UK and Europe Channel Islands USA | | | India Mauritius | | | | | | | | | | | | | | | | | | | | | Interest and views from our stakeholders Strong partnerships and understanding are essential to the creation of enduring worth. To understand stakeholders’ needs, we work hard to establish the most effective ways of engagement. These interactions inform what we focus on, how we engage with our stakeholders and how, through our strategy and purpose, we can improve as a business. Refer to our stakeholder engagement disclosure, Section 172(1) statement on page [15](#ie3c0f0ecbe744ceeaff4a20772cdfe84_1253). Our continuous engagement with stakeholders has confirmed that their perspectives align with our current strategy and business model, and as a result, we are not altering our strategy or business model. Future engagement with our stakeholders In addition to regular stakeholder engagement, we aim to enhance our client engagement to support our transition plans. As part of our commitment to a sustainable and inclusive transition, we are developing a structured client engagement strategy to support our clients in navigating the evolving sustainability landscape. This strategy will focus on collaborative engagement, capacity building and, where appropriate, tailored financial solutions to drive meaningful progress towards net zero and other sustainability objectives. We plan to proactively engage with clients, particularly in high- impact sectors, to assess their transition readiness, understand sector-specific challenges, and develop credible transition plans aligned with global and sector-specific climate goals and regulatory expectations. This will enable us to continue in long- term partnerships with our clients and not only mitigate sustainability-related risks but also unlock new opportunities for responsible growth and innovation. This engagement strategy will be underpinned by clear metrics, ensuring transparency and accountability. Oversight on stakeholders’ engagement The Board, directors and Executives are consistently kept informed about the perspectives and interests of our stakeholders. This includes insights from client and investor dialogues, employee feedback channels, community engagements, regulatory consultations and industry forums. Key stakeholder concerns and emerging sustainability risks are communicated to the Board and the DLC SEC. Furthermore, the DLC SEC approves any modifications to the DMA, including the exclusion of topics, the inclusion of industry-relevant topics, and the assessment of both positive and negative impacts, as well as financial risks and opportunities arising from the DMA outcomes. Current financial effects of material IROs There are no anticipated material financial effects from our material IROs identified over the short term. The Group uses best available data to make accounting judgements and estimates related to climate change, focusing on clients' credit risk and asset valuations. Most climate impacts are long term and have minimal effect on current estimates. Key short-term impacts include: • Expected credit loss (ECL) measurement • Asset impairment and deferred tax assets. Additionally, we have not identified material risks that could lead to significant adjustments in the carrying amounts of assets and liabilities reported in the related financial statements within the next annual reporting period. Refer to [E1 – Climate change](#id692d188e16a4d9a8634dec099e88221_461996) for more information. Resilience of our strategy and business model IBP evaluates the resilience of our strategy and business model in terms of its ability to identify material impacts, address associated risks and capitalise on resulting opportunities. This resilience is supported through the IBP BRCC from which relevant risks are escalated to the Board. Resilience of our strategy around [E1-Climate change](84S0VF8TSMH0T6D4K848-2025-03-31-T01.html#i447e4d363cd344738300acdd42f0e3a0_3004-bookmark-aa105112f2864f6192b79832ce312c43)is found in the topic- specific disclosures. 309 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Impact, risk and opportunity management Process of identifying and assessing material IROs During the financial year ended 31 March 2024, the Investec Group performed a DMA. This assessment provided us with an understanding and deeper insights into the sustainability topics that are material to the Investec Group, as well as our stakeholders’ views on our impact on society, the environment and governance matters. The Investec Group conducted the DMA during the initial phase of emerging regulatory requirements, resulting in a process that is still evolving and not yet fully mature. Recognising this early stage, we are dedicated to refining our DMA methodology by incorporating industry best practices and continuously enhancing our approaches. Although we faced challenges, such as stakeholders’ unfamiliarity with the DMA concept, we have made essential adjustments to improve clarity and comprehension. These adjustments included simplifying the language used in our communications. We ensured that IROs for both geographies (South Africa and the UK) were carefully considered throughout the process. While IBP and Investec Bank Limited operate in distinct regulatory environments, their business models, target markets and stakeholder expectations share significant alignment. To ensure a comprehensive and jurisdictionally relevant assessment, we followed a structured methodology, incorporating: • Investec Group-level materiality assessment as a foundation • Regulatory horizon scanning to account for differences in UK, EU and South African sustainability frameworks • Engagement with both UK and South African stakeholders • Internal validation to align material topics with IBP’s strategic objectives and risk management approach. Moving forward, IBP remains committed to review the IROs annually for any material changes and conduct a robust DMA every two years that effectively addresses our key sustainability matters. The following process outlines our DMA approach | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 1 | | 2 | | 3 | | | | | | | | | | Process | | Horizon scanning and research | | Stakeholder interviews, impact assessments and surveys\* | | Results analysis | | | | | | | | | | Objective | | To identify industry-relevant material topics | | To identify material IROs relating to the industry-relevant material topics | | To verify material IROs identified by stakeholders and adjust outcomes where results are misaligned to expectations | | | | | | | | | | Outcome | | List of industry-relevant sustainability topics | | Material IROs identified by stakeholders | | Material IROs for IBP | ![]() ![]() ![]() \*Survey result were for internal use only and outcome of the surveys did not result in identification of material IROs. 310 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | 1. | Horizon scanning and research: Identification of relevant sustainability matters and associated IROs | We conducted a horizon scan exercise to identify relevant sustainability topics and emerging trends both globally and within the financial sector. This horizon scan was performed to consider broader topics of interest to Investec, that are not required by ESRS 1, AR16. By consulting a diverse range of resources, we compiled an extensive list of industry-specific sustainability topics, including those highlighted by our peers. Our horizon scan incorporated various frameworks and sustainability-related rating methodologies, trends specific to the financial industry, global sustainability developments, relevant legislation, media and peer reviews, as well as IBP-specific reports. This research enabled us to conduct an industry-relevant assessment, focusing on the sustainability topics relevant to the financial industry as well as those highlighted by our peers and broader stakeholders. This assessment was conducted by the Investec core team, in collaboration with a third-party adviser. While this assessment was carried out at the Investec Group level, attention was given to specific nuances that might be applicable to IBP. The industry- relevant topic shortlist was developed by the Investec core team, who was authorised by Group Executives to make decisions during the DMA process, alongside the third-party adviser. The Investec core team comprised employees who were well versed on DMA issues, from both South Africa and the UK, along with a third-party adviser who is familiar with the Investec Group. This collaboration ensured that potential material topics relevant to specific geographies were not overlooked. Through the horizon scanning process, a shortlist of industry-relevant topics was identified and verified by both the Investec core team and the third-party adviser to ensure alignment across all entities in South Africa and the UK. This final shortlist included topics applicable to the Investec Group and its main entities (Investec Bank Limited and Investec Bank plc) in each of these regions. We applied a double materiality approach to the industry-relevant topic list to assess sustainability-related IROs, ensuring that both outward and inward sustainability impacts were considered to identify potential sustainability matters. • Financial materiality: The assessment involved identifying and analysing how sustainability-related matters could affect our financial performance, including potential risks and opportunities arising from regulatory changes, market shifts, and operational challenges • Impact materiality: Simultaneously, we assessed the outward impacts of our business activities on society and the environment. | | | | | | --- | --- | --- | --- | | | | | | | | | | | | Impact materiality Investec’s impact on the environment, society and governance-related topics | | | Inside-out perspective • Inside-out perspective is used to measure the actual or potential, and positive or negative, impacts on people or the environment that Investec may have • This refers to the businesses we finance, our products and services and the impacts directly linked to our operations | | | | | | | | | | | | Financial materiality Impact on the environment, society and governance-related topics on Investec’s financial performance | | | Outside-in perspective • Outside-in perspective is used to measure the risks and opportunities of a changing environment and society on Investec • This primarily pertains to the impact that climate change and other environmental issues may have on Investec's financial performance | | | | | | We used several key assumptions including: • Scope: The assessment focused on our upstream, own operations and downstream value chain • Time horizons: The assessment covered short-term (within 1 year), medium-term (1 to 5 years), and long-term (>5 years) sustainability-related IROs • Use of external sustainability benchmarks, regulatory guidance and industry best practice: The assessment considered industry frameworks, sustainability rating methodologies, relevant legislation, industry trends, media analyses, peer evaluations and all pertinent Investec documentation, ensuring relevance to financial services and investment activities • Global sustainability reporting standards: We considered a range of sustainability reporting standards including Task Force on Climate-related Financial Disclosures (TCFD), Global Reporting Initiative (GRI) and IFRS® Accounting Standards (IFRS®) S1 and S2 to ensure consistency and comparability. 311 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | 2. | Stakeholder interviews, impact assessment and surveys | While the assessment was conducted at the Investec Group level, stakeholders from both of our anchor geographies (the UK and South Africa) were involved in evaluating the material matters relevant to the IBP and Investec Bank Limited entities. This was due to the significant overlap in the business activities, investors, target-market clients and material matters across the two entities. The DMA covered the Investec Group’s value chain, with stakeholder input primarily from the UK and South Africa. Given Investec’s presence in these regions and other jurisdictions, the assessment considered regional sustainability challenges, regulatory landscapes and socio-economic conditions that may influence material impacts and risks. We conducted an internal review to compile a list of stakeholders, working closely with the Investec Investor Relations team. This collaboration ensured that the selected stakeholders were well acquainted with our business activities and had a solid understanding of sustainability matters. The stakeholder list included shareholders, business partners, media representatives, non-governmental organisations, consulting firms, clients, and employees from various business functions. Where stakeholders were unable to contribute, proxies were used, as in the case of regulators, where current sustainability legislation was assessed and included in the DMA. Engagement methods included interviews, impact assessments and surveys to ensure a comprehensive understanding of stakeholder concerns and expectations. Care was taken to ensure a mix of both affected stakeholders and users of sustainability information for the IBP and the Investec Bank Limited entities. We assessed our stakeholders’ views on which sustainability-related risks and opportunities they felt could affect financial performance either in IBP or Investec Bank Limited, and the impacts Investec might have on people and the planet. Stakeholder interviews: Interviews were conducted with various stakeholder groups to gather their insights and opinions on the IROs of the industry-relevant sustainability topics. For IBP, four stakeholders were based in the UK, while an additional three stakeholders were interviewed to provide a global perspective encompassing both IBP and IBL. The interview process took into account our impact on sustainability topics (impact materiality) as well as the influence of these sustainability topics on Investec, particularly regarding our financial performance (financial materiality). Impact assessments: Sixteen detailed impact assessments were conducted, of which 12 were outward impact assessments and four financial impact assessments, representing a wide range of business functions across IBP and Investec Bank Limited. The contributors of these impact assessments considered any geographical nuances that may exist between IBP and Investec Bank Limited. This included considerations of local regulatory frameworks, cultural differences, and socio-economic factors that may influence stakeholder expectations and business operations in each region. For instance, the assessments factored in South Africa's unique environmental challenges and developmental priorities, as well as the UK’s established sustainability regulations and market dynamics. In addition, our third-party adviser performed a review through an outward impact assessment. These impact assessments involved a more in-depth assessment of impact using granular assessment criteria that considered both current and future impacts. A sustainability matter was considered material when it satisfied the criteria for impact materiality, financial materiality, or both. The interdependence between the two dimensions was recognised. For example, a sustainability impact may already be financially material, or may become so over time. During the impact assessment, relevant impacts were classified either as negative (net harm to society, the environment and/or the economy) or positive (net benefit to the society, environment and/or economy) or neutral (neither net harm, nor net benefit). Our impact materiality (the impact that Investec has on the environment and society) considered severity and likelihood. • The severity of the impact regardless of our efforts to adjust the impact has been considered in terms of: • Scale: How grave or beneficial our impact is on the topic • Scope: How widespread our impact is on the topic • Remediability: For negative impacts, how easy it is to put the impact right • The likelihood of the impact occurring, considering mitigation of negative impacts and/or contribution to positive impacts from the wider operating context (e.g. laws, regulations, social customs) and our actions and processes. Our financial materiality (the impact that the environment and society has on our financial performance) considered the magnitude of the impact and the likelihood of the impact occurring. The diagram below illustrates how we assessed IROs as part of the DMA. | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | Sustainability matters | | | | Positive | | Actual | | Severity = Scale x Scope | | x likelihood | | | Impact materiality | | | Potential/future | | | | | | | | | | | | | | | | Negative | | Actual | | Severity = (Scale x Scope) + irremediability | | x likelihood | | | | | | Potential/future | | | | | | | | | | | | | | | | | | Opportunities | | Magnitude | | | | x likelihood | | | Financial materiality | | | | | | | | | | | | | | | | | Risks | | Magnitude | | | | x likelihood | | | | | | | ![]() Surveys: The survey results were gathered from 64 employees, capturing their perceptions of our influence and impact. This provided valuable insights into sustainability-related topics within our business and helped validate findings from other sources. The results were for internal use only and did not identify any material issues related to IROs. 1 The threshold of four, is a half-point higher than a 'moderate impact' in the context of the high scores recorded across all inputs. 312 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | 3. | Results analysis | To ensure objectivity and robustness in our outward impact assessment, a differentiated weighting approach was applied to input sources. A weighting of five was assigned to the external third-party adviser, reflecting their specialist expertise, impartiality and sectoral benchmarking capability. A weighting of three was allocated to the Investec core team to acknowledge internal insights while recognising that sustainability impact assessments are still an evolving area of expertise within the organisation. Interviews were weighted at two to limit the risk of institutional bias. For the financial materiality assessment, a weighting of two was assigned to the Investec core team, recognising their direct insight into the Bank’s financial performance, risk exposure and strategic priorities. Stakeholder interviews were weighted at one, as these inputs were considered less informed about internal financial metrics and risk-return implications. The external third-party adviser was not included in the financial impact weighting due to their limited institutional knowledge of Investec’s financial structures, performance drivers and operational context. The weighting applied to the assessments is shown below: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Impact materiality | | | | | Financial materiality | | | | | | | | | | | | | | | | | | | Impact assessments | | 1. Third-party adviser Weighting: 5 | | 2. Investec core team Weighting: 3 | | | 4. Investec core team Weighting: 2 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Interviews | | 3. Stakeholder interviews Weighting: 2 | | | | | 5. Stakeholder interviews Weighting: 1 | | 6. Employee survey The survey gathered employee perceptions regarding our impact and influence. These results were informative and were utilised to review and challenge the draft matrix. | | | | | | | | | | | | | | | The scoring outcomes were analysed and calibrated as necessary. This process involved data analysis conducted by our third- party adviser, as well as assessments performed by the Investec core team. Defining our materiality threshold A materiality threshold is required by the ESRS disclosure requirements to determine which topics are material for reporting purposes. The threshold indicates topics that are currently impactful, although we also consider emerging topics. The results were plotted on a materiality matrix, and a threshold of 4 1 (out of 5) was applied to determine a threshold for reporting purposes. While a threshold is required by CSRD, it is not prescriptive in how this is set. For both outward and financial impact, a score of 4 represents a significant impact. We recognise that topics can shift over time as the external context and IBP’s approach changes. Therefore, we will refresh our materiality assessment every two years to determine whether any topics have crossed, or fallen below, the threshold of materiality. As a result, any topic above this threshold is deemed material. Calibrating outcomes, manual adjustments and validation IBP Executives and the DLC SEC approved the industry- relevant topics identified by the Investec core team, including those deemed not applicable to the financial sector. After the initial scoring of the IROs, a calibration process was conducted to ensure alignment with IBP’s strategic context and stakeholder relevance. This process involved manual adjustments of certain outcomes where the initial scoring did not fully reflect material dynamics. Notably, although financed emissions initially scored below the materiality threshold, the topic was elevated in recognition of its long-term systemic relevance, regulatory momentum and alignment with IBP’s climate strategy. Data privacy, cyber security, corporate culture, protection of whistleblowers and, corruption and bribery were reclassified from financial opportunities to financial risks. This decision reflected the increasing regulatory scrutiny, reputational exposure, and operational consequences associated with ethical lapses, which can outweigh any perceived benefit. These calibrations were guided by a precautionary principle, ensuring that the final outcomes considered both current risk exposure and the evolving expectations of regulators, investors and broader society. The final IROs, which incorporated the calibration and manual adjustments, were presented to the executive leadership and communicated to various Executive and Board committees and approved by the DLC SEC. Integration of sustainability-related risks into risk management processes Sustainability risk is managed as a principal risk within IBP (refer to page [48](#i1ebf2cc78d4140be8d60283bd3bbd63e_1-1-1-2-2674208)). This risk is defined as the risk that our lending and investing activities give rise to unintended climate, environmental, social and economic consequences. We regard sustainability risk as equally significant as traditional risks, including credit, operational and market risks. By assessing sustainability risks alongside these conventional risks, we can identify potential financial and reputational impacts on our business. 313 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | We have a holistic approach to sustainability, and support the precautionary approach to sustainability management, guided by industry best practices regarding the responsibilities of the financial sector in financing and investing transactions. This approach goes beyond recognising our own footprint on the environment and is based on a broader responsibility to the environment and society. We recognise the complexity and urgency of climate change and are committed to supporting the transition to a clean and energy-efficient world while preserving our planet and the wellbeing of our people. Our commitment to human rights and support for internationally recognised principles, guidelines and voluntary sustainability standards are tightly integrated into our credit decision-making process and considers the important aspects of each geography in which we operate. The outcomes of our DMA align closely with the material IROs that IBP already manage. This gives comfort that the insights from the DMA are fully integrated into our enterprise risk management frameworks and business activities. Reporting on material IROs Non-material topics The following topics were not deemed material. Given our role as a financial services provider, with a business model centred on banking and wealth management, we have not screened our lending and investing activities to identify actual and potential IROs relating to E2 – Pollution, E5 – Resource use and circular economy, and S2 – Workers in the value chain. Furthermore, topics relating to E3 – Water and marine, E4 – Biodiversity and ecosystems, and S3 – Affected communities did not cross our materiality threshold. These topics will be reassessed for relevance during our next scheduled DMA process. The table below shows the topics that were excluded. | | | | | --- | --- | --- | | | | | | Non-material topic | | Reason for exclusion | | E | ESRS E2 – Pollution | During the horizon scan, pollution was not identified as a relevant topic for the financial services industry and was therefore excluded from the shortlist of topics | | ESRS E3 – Water and marine resources | Water and marine resources did not cross our materiality threshold | | ESRS E4 – Biodiversity and ecosystems | Biodiversity and ecosystems did not cross our materiality threshold | | ESRS E5 – Circular economy | During the horizon scan, circular economy was not identified as a relevant topic for the financial services industry and was therefore excluded from the shortlist of topics | | S | ESRS S2 – Workers in the value chain | Workers in the value chain was omitted because the topic was not deemed relevant to IBP due to its activities in financial services | | ESRS S3 – Affected communities | Affected communities did not cross our materiality threshold | 314 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Material IROs The table below presents an overview of the material IROs identified in our DMA. Each IRO is accompanied by an indication of where these elements are situated within our value chain and how they affect our business model. Additionally, the relevant time horizons are included. It is important to note that we found the outcomes of the impacts to be predominantly positive. This may be attributed to the DMA process being new and not fully understood by our stakeholders initially, and that risk mitigation measures were considered during the impact assessment process. IBP is committed to enhancing stakeholder understanding as the integration of environmental, social and governance (ESG) considerations into business practices evolves. IBP remains committed to review the IROs annually for any material changes and conduct a robust DMA every two years that effectively addresses our key sustainability matters. | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Time horizon | | | Value chain | | | | | Material topic | | | | IRO type | Material IROs | | | | Short term | Medium term | Long term | Upstream | Own operations | Downstream | Affected business model | | E | | [ESRS E1](#id692d188e16a4d9a8634dec099e88221_76) Climate change | | PI | Climate change mitigation: Energy transition finance activities | | | | √ | √ | √ | | | √ | • Private Client Banking activities • Corporate and Investment Banking activities | | | | | | | | | | | | | | FR | Climate change mitigation: Financed emissions Climate change mitigation: Fossil fuel financing | | | | √ | √ | √ | | | √ | | | | | | | | | | | | | | FO | Climate change mitigation: Energy transition finance | | | | | √ | √ | | | √ | | | | | | | | | | | | | | | | | | | S | | [ESRS S1](#ie588ca37b98f4c428b70390c95ba5a4c_104) Our people | | PI | Working conditions: Employee rights Equal treatment and opportunities for all: Diversity Entity specific: Employee mental health and wellbeing | | | | √ | √ | √ | | √ | | • Own operations | | | | | | | | | | | | | | FR | Working conditions: Employee remuneration | | | | √ | √ | √ | | √ | | | | | | | | | | | | | | | FO | Working conditions: Employee rights Equal treatment and opportunities for all: Diversity Entity specific: Employee mental health and wellbeing | | | | √ | √ | √ | | √ | | | | | | | | | | | | | | | | | | [ESRS S4](#i13a712e9cf754173b39d1d43c119468c_19874) Our clients | | FR | Information-related impacts: Data privacy Entity specific: Cyber security | | | | √ | √ | √ | | | √ | • Private Client Banking activities • Corporate and Investment Banking activities | | | | | | | | | | | | | | FO | Information-related impacts: Client engagement and marketing | | | | √ | √ | √ | | | √ | | | | | | | | | | | | | | | | | | | G | | [ESRS G1](#i408f7569c095494f86a844396a50e338_18293) Business conduct | | PI | Entity specific: Regulatory and legal compliance | | | | √ | √ | √ | | √ | √ | • Own operations | | | | | | | | | | | | | | FR | Business conduct: Corporate culture Business conduct: Protection of whistleblowers Business conduct: Corruption and bribery | | | | √ | √ | √ | √ | √ | √ | | | | | | | | | | | | | | FO | Entity specific: Transparency and disclosure Entity specific: Regulatory and legal compliance | | | | √ | √ | √ | | √ | √ | | | | | | | | | | | | | | | | | | | | Key | | | | | | | | | | | | | | | | | NI | Negative impact | | | FO | Financial opportunity | | | | | | | | | | | | PI | Positive impact | | | FR | Financial risk | | | | | | | | | | 315 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Summary of material IROs The outcome from our DMA highlighted material IROs as identified by our stakeholders. From an environmental perspective, our stakeholders identified our impact on climate change as material, focusing on financial risk from financed emissions and fossil fuel financing, and the opportunities within energy transition finance in our downstream value chain. We recognise that our commitment to reducing our financed emissions is essential not only for compliance but also for enhancing our competitive advantage in a rapidly evolving market. We have calculated and disclosed our Scope 3 financed emissions from our lending and investing activities, covering 59% of the IBP loan book. Furthermore, we have leveraged our Sustainable and Transition Finance Framework to guide our commercial activities within its scope, aiming to achieve our target of facilitating £14.9 billion of sustainable and transition finance by 2030 for the Bank. This allows us to remain committed to our sustainability goals while maintaining our core business objectives. Further information can be found in [E1 – Climate change](#id692d188e16a4d9a8634dec099e88221_76)[.](#id692d188e16a4d9a8634dec099e88221_76) Regarding social matters, our stakeholders identified our impact on our employees, particularly in relation to safeguarding employee rights, diversity and employee mental health and wellbeing as material and a potential financial risk associated with employee remuneration. To mitigate this financial risk, we ensure that our employees’ remuneration aligns with local regulations and is reflective of their performance and contribution. We pay above the minimum living wage. Our diversity and inclusion framework aims to create a sense of belonging for all employees. We have exceeded our targets regarding representation of women on both the IBP Board and within senior management (as outlined in the Women in Finance Charter). Furthermore, aligned to our core value of care and concern for employees, we offer employees a comprehensive wellbeing programme which focuses on physical, mental and financial health. Regarding diversity, equity and inclusion, our Board consists of 40% women, in line with our target of 40.0%. Our consultative forum, chaired by members of relevant management teams, remains dedicated to increasing the representation of underrepresented groups in strategic decision-making. Further information can be found in [S1 – Our people](#ie588ca37b98f4c428b70390c95ba5a4c_104). Moreover, our stakeholders identified a potential financial opportunity regarding client engagement and marketing. We recognise the significance of engagement through transparent client interactions and marketing practices and will continue to enhance our framework where we identify vulnerabilities. Our Client Communications and Financial Promotions Policy ensures that accurate and transparent information is communicated to our clients. Furthermore, we prioritise data privacy and cyber security in all our operations and regularly review and test our security measures for any vulnerabilities. As a relationship-driven bank, client trust and engagement are foundational to our success. This trust is built not only through personalised and responsible marketing but also through our commitment to protecting client data and ensuring robust cyber security. These practices are embedded into our digital service offerings and client interaction channels, supporting both innovation and resilience. Strong data governance and security enable us to deliver tailored client experiences while safeguarding sensitive information, thereby reducing reputational and regulatory risk. These efforts align with our strategy by reinforcing client-centricity, maintaining stakeholder confidence and unlocking opportunities for sustainable value creation across our business activities. Further information can be found in [S4 – Our clients](#i13a712e9cf754173b39d1d43c119468c_19874). From a governance perspective, our stakeholders identified our governance around business conduct, particularly corporate culture, protection of whistleblowers, and, corruption and bribery, as material. These matters pose a financial risk for IBP due to the reputational, legal and regulatory consequences associated with ethical misconduct. Failures in these areas can lead to fines, litigation, loss of client trust and exclusion from key markets, all of which can materially impact financial performance and long-term value creation. To mitigate this risk, our commitment to sound corporate governance is deeply ingrained in our values, culture, processes and organisational structure. We firmly believe in upholding integrity at all levels, with our directors and employees consistently demonstrating uncompromising moral strength. Furthermore, our stakeholders identified transparency and disclosure, and regulatory and legal compliance as a financial opportunity, recognising that early and credible alignment with emerging sustainability regulations enhances our access to responsible capital, strengthens investor confidence and supports long-term value creation. Furthermore, adhering to regulations can enhance our reputation and build trust with our stakeholders, including our clients, investors and partners. This trust can lead to increased customer loyalty, a stronger brand image and the potential for higher revenue. Demonstrating leadership in compliance also positions us favourably in a market increasingly shaped by sustainability-driven risk assessments and investment criteria. To date, there have been no changes to our business model, value chain, strategy or decision-making concerning the material IROs identified through the DMA. Sustainability continues to be a core aspect of our business, and we remain mindful of the impact our commercial activities may have on broader society and the planet. 316 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | The table below presents a summary of the IROs classified as material, important and informative. As we evaluate the anticipated impacts of our material IROs, we will continue to explore effective ways to monitor and respond to these effects. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | Sustainability matters | | | Impact materiality | | Financial materiality | | | Link to sustainability strategy and impact SDGs | | E1 – Climate change | | | | | | | | Climate action 13 climate action.png | | E2 – Pollution | | | | | | | | | E3 – Water and marine resources | | | | | | | | | E4 – Biodiversity and ecosystems | | | | | | | | | E5 – Resource use and circular economy | | | | | | | | | S1 – Own workforce (Our people) | | | | | | | | Reduced inequalities SDG10.svg | | S2 – Workers in the value chain | | | | | | | | | S3 – Affected communities | | | | | | | | | S4 – Consumers and end-users (Our clients) | | | | | | | | | G1 – Business conduct | | | | | | | | Sustainability governance | | | | | | | | | | | | Key: | | | | | | | | | | Material topics | | | | | | | | | | Important topics | | | | | | | | | | Informative topics | | | | | | | | | The topics related to E2 – Pollution, E5 – Resource use and circular economy, and S2 – Workers in the value chain were excluded from the industry-relevant topic shortlist due to our role as a financial services provider. Our business model is centred on banking and wealth management, rather than on sectors such as industrial, manufacturing or extraction, where direct pollution risks, circular economy impacts and impacts on workers in the value chain are more pronounced. We consider these topics to be informative. Additionally, the topics associated with E3 – Water and marine resources, E4 – Biodiversity and ecosystems, and S3: Affected communities did not meet our materiality threshold, however, we recognise them as important areas of focus. 2 Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability-related disclosures in the financial services sector (Sustainable Finance Disclosures Regulation) (OJ L 317, 9.12.2019, p. 1). 3 Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (Capital Requirements Regulation “CRR”) (OJ L 176, 27.6.2013, p. 1). 4 Regulation (EU) 2016/1011 of the European Parliament and of the Council of 8 June 2016 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No 596/2014 (OJ L 171, 29.6.2016, p. 1). 5 Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (‘European Climate Law’) (OJ L 243, 9.7.2021, p. 1). 6 Refer to our material IROs identified in the ESRS Appendix [here](#i447e4d363cd344738300acdd42f0e3a0_3035). 7 Commission Delegated Regulation (EU) 2020/1816 of 17 July 2020 supplementing Regulation (EU) 2016/1011 of the European Parliament and of the Council as regards the explanation in the benchmark statement of how ESG factors are reflected in each benchmark provided and published (OJ L 406, 3.12.2020, p. 1). 8 Commission Implementing Regulation (EU) 2022/2453 of 30 November 2022 amending the implementing technical standards laid down in Implementing Regulation (EU) 2021/637 as regards the disclosure of ESG risks (OJ L 324,19.12.2022, p. 1). 9 Commission Delegated Regulation (EU) 2020/1818 of 17 July 2020 supplementing Regulation (EU) 2016/1011 of the European Parliament and of the Council as regards minimum standards for EU Climate Transition Benchmarks and EU Paris-aligned Benchmarks (OJ L 406, 3.12.2020, p. 17). 317 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Data points that derive from other EU legislation The table below illustrates the data points in ESRS 2 and topical ESRS that derive from other EU legislation. | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | Disclosure Requirement and related data point | SFDR reference 2 | Pillar 3 reference 3 | Benchmark Regulation reference 4 | EU Climate Law reference 5 | Material/not material 6 | Page ref | | ESRS 2 GOV-1 – Board's gender diversity (par 21.d) | Indicator 13 Table #1 of Annex 1 | | Commission Delegated Regulation (EU) 2020/1816 Annex II 7 | | Material | [297](#i118dad0ceb4f4298bf840dcaa1b17113_501048) | | ESRS 2 GOV-1 – Percentage of Board members who are independent (par 21.e) | | | Delegated Regulation (EU) 2020/1816, Annex II | | Material | [297](#i118dad0ceb4f4298bf840dcaa1b17113_501048) | | ESRS 2 GOV-4 – Statement on due diligence (par 30) | Indicator 10 Table #3 of Annex 1 | | | | Material | [305](#i118dad0ceb4f4298bf840dcaa1b17113_61601) | | ESRS 2 SBM-1 – Involvement in activities related to fossil fuel activities (par 40.d i) | Indicator 4 Table #1 of Annex 1 | Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Table 1: Qualitative information on Environmental risk and Table 2: Qualitative information on Social risk 8 | Delegated Regulation (EU) 2020/1816, Annex II | | Material | [325](#id692d188e16a4d9a8634dec099e88221_675418) | | ESRS 2 SBM-1 – Involvement in activities related to chemical production (par 40.d ii) | Indicator 9 Table #2 of Annex 1 | | Delegated Regulation (EU) 2020/1816, Annex II | | Not material | | | ESRS 2 SBM-1 – Involvement in activities related to controversial weapons (par 40.d iii) | Indicator 14 Table #1 of Annex 1 | | Delegated Regulation (EU) 2020/1818, Article 12(1) Delegated Regulation (EU) 2020/1816, Annex II 9 | | Not material | | | ESRS 2 SBM-1 – Involvement in activities related to cultivation and production of tobacco (par 40.d iv) | | | Delegated Regulation (EU) 2020/1818, Article 12(1) Delegated Regulation (EU) 2020/1816, Annex II | | Not material | | | ESRS E1-1 – Transition plan to reach climate neutrality by 2050 (par 14) | | | | Regulation (EU) 2021/1119, Article 2(1) | Material | [321](#id692d188e16a4d9a8634dec099e88221_623480) | | ESRS E1-1 – Undertakings excluded from Paris-aligned Benchmarks (par 16.g) | | Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 1: Banking book – Climate Change transition risk: Credit quality of exposures by sector, emissions and residual maturity | Delegated Regulation (EU) 2020/1818, Article12.1 (d) to (g), and Article 12.2 | | Material | [321](#id692d188e16a4d9a8634dec099e88221_623480) | | ESRS E1-4 – GHG emission reduction targets (par 34) | Indicator 4 Table #2 of Annex 1 | Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 3: Banking book – Climate change transition risk: alignment metrics | Delegated Regulation (EU) 2020/1818, Article 6 | | Material for Scope 3 finance emissions only | [324](#id692d188e16a4d9a8634dec099e88221_667913) | | ESRS E1-5 – Energy consumption from fossil sources disaggregated by sources (only high climate impact sectors) (par 38) | Indicator 5 Table #1 and Indicator 5 Table #2 of Annex 1 | | | | Not material | | | ESRS E1-5 – Energy consumption and mix (par 37) | Indicator 5 Table #1 of Annex 1 | | | | Not material | | | ESRS E1-5 – Energy intensity associated with activities in high climate impact sectors (par 40 to 43) | Indicator 6 Table #1 of Annex 1 | | | | Not material | | 10 Investec Bank plc deems this metric not relevant to credit institutions. We do disclose the Economic Emission Intensity metric as recommended by PCAF, see our financed emissions tables. 11 IBP has opted for a phased-in approach 318 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | Disclosure Requirement and related data point | SFDR reference 2 | Pillar 3 reference 3 | Benchmark Regulation reference 4 | EU Climate Law reference 5 | Material/not material 6 | Page ref | | ESRS E1-6 – Gross Scope 1, 2, 3 and Total GHG emissions (par 44) | Indicator 1 and 2 Table #1 of Annex 1 | Article 449a; Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 1: Banking book – Climate change transition risk: Credit quality of exposures by sector, emissions and residual maturity | Delegated Regulation (EU) 2020/1818, Article 5(1), 6 and 8(1) | | Material | [324](#id692d188e16a4d9a8634dec099e88221_624280) | | ESRS E1-6 – Gross GHG emissions intensity (par 53 to 55) | Indicator 3 Table #1 of Annex 1 | Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 3: Banking book – Climate change transition risk: alignment metrics | Delegated Regulation (EU) 2020/1818, Article 8(1) | | Not material 10 | | | ESRS E1-7 – GHG removals and carbon credits (par 56) | | | | Regulation (EU) 2021/1119, Article 2(1) | Not material | | | ESRS E1-9 – Exposure of the benchmark portfolio to climate- related physical risks (par 66) 11 | | | Delegated Regulation (EU) 2020/1818, Annex II Delegated Regulation (EU) 2020/1816, Annex II | | Material | [326](#id692d188e16a4d9a8634dec099e88221_675419) | | ESRS E1-9 – Disaggregation of monetary amounts by acute and chronic physical risk (par 66.a) 11 ESRS E1-9 – Location of significant assets at material physical risk (par 66.c)11 | | Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 paragraphs 46 and 47; Template 5: Banking book – Climate change physical risk: Exposures subject to physical risk | | | Not material | | | ESRS E1-9 – Breakdown of the carrying value of its real estate assets by energy-efficiency classes (par 67.c)11 | | Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 paragraph 34; Template 2:Banking book – Climate change transition risk: Loans collateralised by immovable property – Energy efficiency of the collateral | | | Not material | | | ESRS E1-9 – Degree of exposure of the portfolio to climate- related opportunities (par 69)11 | | | Delegated Regulation (EU) 2020/1818, Annex II | | Not material | | | ESRS E2-4 – Amount of each pollutant listed in Annex II of the E-PRTR Regulation (European Pollutant Release and Transfer Register) emitted to air, water and soil (par 28) | Indicator 8 Table #1 Indicator 2 Table #2 Indicator 1 Table #2 Indicator 3 Table #2 of Annex 1 | | | | Not material | | | ESRS E3-1 – Water and marine resources (par 9) | Indicator 7 Table #2 of Annex 1 | | | | Not material | | | ESRS E3-1 – Dedicated policy (par 13) | Indicator 8 Table 2 of Annex 1 | | | | Not material | | | ESRS E3-1 – Sustainable oceans and seas (par 14) | Indicator 12 Table #2 of Annex 1 | | | | Not material | | | ESRS E3-4 – Total water recycled and reused (par 28.c) | Indicator 6.2 Table #2 of Annex 1 | | | | Not material | | | ESRS E3-4 – Total water consumption in m 3 per net revenue on own operations (par 29) | Indicator 6.1 Table #2 of Annex 1 | | | | Not material | | 12 Investec Bank plc deems this metric not relevant to credit institutions. We do disclose our policies for S1 – Our people in the topic standards for S1. 319 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | Disclosure Requirement and related data point | SFDR reference 2 | Pillar 3 reference 3 | Benchmark Regulation reference 4 | EU Climate Law reference 5 | Material/not material 6 | Page ref | | ESRS 2 IRO 1 – E4 (par 16.a i) | Indicator 7 Table #1 of Annex 1 | | | | Not material | | | ESRS 2 IRO 1 – E4 (par 16.b) | Indicator 10 Table #2 of Annex 1 | | | | Not material | | | ESRS 2 IRO 1 – E4 (par 16.c) | Indicator 14 Table #2 of Annex 1 | | | | Not material | | | ESRS E4-2 – Sustainable land/ agriculture practices or policies (par 24.b) | Indicator 11 Table #2 of Annex 1 | | | | Not material | | | ESRS E4-2 – Sustainable oceans/seas practices or policies (par 24.c) | Indicator 12 Table #2 of Annex 1 | | | | Not material | | | ESRS E4-2 – Policies to address deforestation (par 24.d) | Indicator 15 Table #2 of Annex 1 | | | | Not material | | | ESRS E5-5 – Non-recycled waste (par 37.d) | Indicator 13 Table #2 of Annex 1 | | | | Not material | | | ESRS E5-5 – Hazardous waste and radioactive waste (par 39) | Indicator 9 Table #1 of Annex 1 | | | | Not material | | | ESRS 2 SBM3-S1 – Risk of incidents of forced labour (par 14.f) | Indicator 13 Table #3 of Annex I | | | | Not material 12 | | | ESRS 2 SBM3-S1 – Risk of incidents of child labour (par 14.g) | Indicator 12 Table #3 of Annex I | | | | Not material2 | | | ESRS S1-1 – Human rights policy commitments (par 20) | Indicator 9 Table #3 Indicator 11 Table #1 of Annex I | | | | Material | [338](#ie588ca37b98f4c428b70390c95ba5a4c_618742) | | ESRS S1-1 – Due diligence policies on issues addressed by the fundamental International Labor Organisation Conventions 1 to 8 (par 21) | | | Delegated Regulation (EU) 2020/1816, Annex II | | Material | [338](#ie588ca37b98f4c428b70390c95ba5a4c_618742) | | ESRS S1-1 – Processes and measures for preventing trafficking in human beings (par 22) | Indicator 11 Table #3 of Annex I | | | | Not material2 | | | ESRS S1-1 – Workplace accident prevention policy or management system (par 23) | Indicator 1 Table #3 of Annex I | | | | Not material | | | ESRS S1-3 – Grievance/ complaints handling mechanisms (par 32.c) | Indicator 5 Table #3 of Annex I | | | | Material | [343](#ie588ca37b98f4c428b70390c95ba5a4c_663699) | | ESRS S1-14 – Number of fatalities and number and rate of work- related accidents (par 88.b,c) | Indicator 2 Table #3 of Annex I | | Delegated Regulation (EU) 2020/1816, Annex II | | Not material | | | ESRS S1-14 – Number of days lost to injuries, accidents, fatalities or illness (par 88.e) | Indicator 3 Table #3 of Annex I | | | | Not material | | | ESRS S1-16 – Unadjusted gender pay gap (par 97.a) | Indicator 12 Table #1 of Annex I | | Delegated Regulation (EU) 2020/1816, Annex II | | Material | [340](#ie588ca37b98f4c428b70390c95ba5a4c_663700) | | ESRS S1-16 – Excessive CEO pay ratio (par 97.b) | Indicator 8 Table #3 of Annex I | | | | Material | [340](#ie588ca37b98f4c428b70390c95ba5a4c_663700) | 320 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | Disclosure Requirement and related data point | SFDR reference 2 | Pillar 3 reference 3 | Benchmark Regulation reference 4 | EU Climate Law reference 5 | Material/not material 6 | Page ref | | ESRS S1-17 – Incidents of discrimination (par 103.a) | Indicator 7 Table #3 of Annex I | | | | Material | [338](#ie588ca37b98f4c428b70390c95ba5a4c_355543) | | ESRS S1-17 – Non-respect of UNGPs on Business and Human Rights and OECD (par 104.a) | Indicator 10 Table #1 Indicator 14 Table #3 of Annex I | | Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818 Art 12 (1) | | Material | [338](#ie588ca37b98f4c428b70390c95ba5a4c_618742) | | ESRS 2 SBM3-S2 – Significant risk of child labour or forced labour in the value chain (par 11.b) | Indicator 12 and 13 Table #3 of Annex I | | | | Not material | | | ESRS S2-1 – Human rights policy commitments (par 17) | Indicator 9 Table #3 Indicator 11 Table #1 of Annex 1 | | | | Not material | | | ESRS S2-1 – Policies related to value chain workers (par 18) | Indicator 11 and 4 Table #3 of Annex 1 | | | | Not material | | | ESRS S2-1 – Non-respect of UNGPs on Business and Human Rights principles and OECD guidelines (par 19) | Indicator 10 Table #1 of Annex 1 | | Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1) | | Not material | | | ESRS S2-1 – Due diligence policies on issues addressed by the fundamental International Labor Organisation Conventions 1 to 8 (par 19) | | | Delegated Regulation (EU) 2020/1816, Annex II | | Not material | | | ESRS S2-4 – Human rights issues and incidents connected to its upstream and downstream value chain (par 36) | Indicator 14 Table #3 of Annex 1 | | | | Not material | | | ESRS S3-1 – Human rights policy commitments (par 16) | Indicator 9 Table #3 Indicator 11 Table #1 of Annex 1 | | | | Not material | | | ESRS S3-1 – Non-respect of UNGPs on Business and Human Rights, ILO principles or and OECD guidelines (par 17) | Indicator 10 Table #1 Annex 1 | | Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1) | | Not material | | | ESRS S3-4 – Human rights issues and incidents (par 36) | Indicator 14 Table #3 of Annex 1 | | | | Not material | | | ESRS S4-1 – Policies related to consumers and end-users (par 16) | Indicator 9 Table #3 Indicator 11 Table #1 of Annex 1 | | | | Material | [344](#i13a712e9cf754173b39d1d43c119468c_291502) | | ESRS S4-1 – Non-respect of UNGPs on Business and Human Rights and OECD guidelines (par 17) | Indicator 10 Table #1 of Annex 1 | | Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1) | | Material | [345](#i13a712e9cf754173b39d1d43c119468c_19786) | | ESRS S4-4 – Human rights issues and incidents (par 35) | Indicator 14 Table #3 of Annex 1 | | | | Material | [345](#i13a712e9cf754173b39d1d43c119468c_19786) | | ESRS G1-1 – United Nations Convention against Corruption (par 10.b) | Indicator 15 Table #3 of Annex 1 | | | | Material | [349](#i408f7569c095494f86a844396a50e338_18293) | | ESRS G1-1 – Protection of whistleblowers (par 10.d) | Indicator 6 Table #3 of Annex 1 | | | | Material | [351](#i408f7569c095494f86a844396a50e338_15913) | | ESRS G1-4 – Fines for violation of anti-corruption and anti- bribery laws (pa 24.a) | Indicator 17 Table #3 of Annex 1 | | Delegated Regulation (EU) 2020/1816, Annex II) | | Material | [354](#i408f7569c095494f86a844396a50e338_158948) | | ESRS G1-4 – Standards of anti- corruption and anti-bribery (par 24.b) | Indicator 16 Table #3 of Annex 1 | | | | Material | [354](#i408f7569c095494f86a844396a50e338_158948) | 13 Net zero commitment by 2050: A pledge to reduce greenhouse gas (GHG) emissions across all scopes (1, 2, and 3) to as close to zero as possible by 2050, with any remaining emissions balanced by removing an equivalent amount from the atmosphere. This commitment aligns with the goals of the Paris Agreement to limit global warming to well below 2°C, and preferably to 1.5°C, above pre-industrial levels 14 321 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | --- | | | | | #### Climate change #### Transition plan for climate change #### mitigation IBP is currently developing a transition plan around our existing climate-related strategy and commitments, which we expect to complete and adopt in the next three years. Our transition plan will be based on our ambition to achieve net zero by 2050, and utilise the guidance set out by the Transition Plan Taskforce as endorsed by the International Sustainability Standards Board (ISSB). We will consider the complexities of our business in the context of climate change. Additionally, we recognise the clear connection between climate change and nature-based ecosystem loss, as well as the impact of our activities on maintaining healthy and resilient ecosystems. In establishing our transition plan, we will use three channels of impact as our foundation: 1. Meeting our fossil fuel exposure commitments: aligned to the double materiality matter identified – climate change mitigation (fossil fuel financing) 2. Driving sustainable and transition finance activities: aligned to the double materiality matter identified – climate change mitigation (energy transition finance) 3. Influencing and advocating for our clients and suppliers to effectively pursue decarbonisation: aligned to the double material matter identified – climate change mitigation (financed emissions). As part of our transition plan, we will develop a comprehensive client engagement strategy that aligns with our sustainability objectives. We will draw on insights from best practice publications to ensure effective communication and collaboration with our clients. #### Material IROs relating to climate change We acknowledge that climate change is material and poses significant risks and opportunities, including its ability to generate value for stakeholders over time. We recognise and support the aims of the Paris Agreement goals and are committed to achieving net-zero emissions by 2050 13, taking into account the complexities of the business in relation to climate change. Additionally, we acknowledge the clear link between climate change and ecosystem loss, and our impact through our activities on healthy and resilient ecosystems. The main challenges we face include navigating the complexities of climate risks, adapting to regulatory changes, and balancing economic growth with sustainability objectives. We are committed to enhancing our climate risk management and sustainability data capabilities, ensuring transparency in our sustainability reporting and alignment with evolving regulatory frameworks. Emissions from IBP’s own operations represent a negligible portion of the total emissions within IBP's value chain and have thus been classified as immaterial. As a result, emissions from our own operations are not included in this Sustainability Statement. However, IBP continues to work on reducing operational emissions and unavoidable residual emissions are offset through the purchase of carbon credits from verified, high quality and ethical carbon removal projects. Further information on our operational emissions can be found in our 2025 Group sustainability report on our website. During our DMA, we incorporated climate-specific factors to evaluate IROs. On the risk side, we identified potential impacts from stricter legislation, increased stakeholder and investor expectations, competitive pressures to offer sustainable financial products, shifts in consumer behaviour towards low- carbon options, concerns about greenwashing, reputational damage, and physical risks to our offices from climate events. In terms of opportunities, we recognised benefits such as improved resource efficiency, enhanced carbon footprint management, innovation in low-emission products and services, new market opportunities, leveraging our brand to promote sustainability, increased investment in clean energy, and expanding our sustainable finance offerings. Specifically for financed emissions, the risks include regulatory tightening, heightened scrutiny from stakeholders and investors, reputational harm, challenges in accurately tracking all financed emissions and incomplete emissions data from third parties. These risks could negatively impact our social, relationship, intellectual and financial capital, potentially affecting our financial performance. However, addressing these emissions presents opportunities to strengthen our sustainability credentials, attract environmentally conscious investors, improve operational efficiencies and develop new revenue streams through sustainable finance products. The following is an overview of the material IROs related to climate change and how these factors link to our strategy and business model. Climate change mitigation has been identified as material for Private Client and Corporate Banking activities within our value chain. Additionally, we recognise the adaptation risks associated with our substantial real estate portfolio, understanding that climate-related impacts such as extreme weather events and rising sea levels could affect the value and functionality of our property holdings however, the impact on the value and functionality is immaterial. Climate change mitigation refers to efforts to substantially reduce global greenhouse gas (GHG) emissions to hold global temperature increase to well below 2°C above pre-industrial levels and pursue efforts to limit it to 1.5°C above pre-industrial levels, recognising that this would significantly reduce the risks and impacts of climate change 14. The material IROs identified, energy transition finance, financed emissions and fossil fuel exposures are treated as transition risk within our lending and investing activities. These IROs materialise through our lending and investing activities. 322 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Climate change mitigation from energy transition finance activities presents a positive impact and financial opportunity, while our financed emissions and fossil fuel financing presents financial risks for IBP as explained below. | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | ESRS E1: Climate change | | | | | Value chain | Affected business model | | PI | Climate change mitigation: • Energy transition finance activities: financing and investment of a energy transition help create healthier communities, foster economic growth, and contribute to environmental preservation | | | | Downstream | • Private Client Banking activities • Corporate and Investment Banking activities | | | | | | | | FR | Climate change mitigation: • Financed emissions: Increased carbon prices and stranded assets • Fossil fuel financing: Risk of stranded assets | | | | | | | | | | | FO | Climate change mitigation: • Energy transition finance: New markets and opportunities for new products, resulting in positive revenues and financial performance | | | | | | | | | | | | | Key | | | | | | | | NI | Negative impact | FO | Financial opportunity | | | | | PI | Positive impact | FR | Financial risk | | | | Positive impact associated with energy transition finance: We recognise the significant positive impact that energy transition finance can have on both environmental and social aspects. By providing financial support for renewable energy projects and initiatives aimed at reducing carbon emissions, we contribute to the global effort to combat climate change and promote a cleaner environment. This not only helps to mitigate the adverse effects of traditional energy sources but also fosters the development of sustainable infrastructure that benefits communities. Furthermore, energy transition finance can create job opportunities and stimulate local economies, enhancing social wellbeing. Opportunity associated with energy transition finance lending: Our stakeholders identified sustainable and transition finance lending as a financial opportunity from new markets and products, resulting in positive revenues and financial performance. In pursuit of our purpose to create enduring worth, and as part of our commitment to reaching net zero by 2050, we announced our sustainable and transition finance target to the market in May 2025, emphasising that this is one of the key levers in our broader sustainability strategy. We recognise that sustainable and transition finance alone will not get us to net zero; it is one of several levers, including that of influencing and advocating to drive meaningful progress in decarbonising business activities and supporting a more sustainable economy. Financial risk associated with financed emissions and fossil fuel financing: We are continuously exploring innovative ways to reduce our Scope 3 financed emissions and remain committed to advocating for climate action. Our approach is collaborative, balancing our ambitions with regional regulations and transition plans. It is important to understand that reductions may not occur annually; rather, they will take place over time as our business evolves and as the countries and sectors implement their respective net-zero strategies. Furthermore, we are committed to managing our fossil fuel financing and have already achieved our goal of zero coal exposure in our loan portfolio as of September 2024, well ahead of the original target date of 31 March 2027. Additionally, we manage our oil and gas exposures, with all transactions in this sector undergoing thorough screening by the Group sustainability team. If any concerns arise, the transaction is presented to the IBP ERC, which will decide whether to proceed, taking into account the context of the values and guardrails established within the Bank. 323 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Policies related to climate change | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Topic and sub-topic | Policies | Targets | Actions | Performance | | | | | | | | Climate change mitigation Financed emissions | Environmental policy and climate change statement | • No target set | • Improving the quality of our data inputs for Scope 3 financed emissions • Investing in the automation of Scope 3 financed emissions • Expanded our scope to include all energy lending activities (previously only power generation was included) | • Enhanced data quality • Financed emissions\* at 31 March 2024 was 3.04 million tCO2e | | | | | | | | | | | | | | Climate change mitigation Fossil fuel financing | Fossil fuel policy | • Zero coal exposure in the IBP loan book by 31 March 2027 • Cease financing of new oil and gas exploration, extraction or production projects directly, regardless of jurisdiction, from 1 January 2035 | • Reduce coal as a percentage of our loan book to 0% by 2027 • Review of our fossil fuel policy every two years | • IBP has no coal exposure in their loan book since September 2024 • Fossil fuel exposure as a percentage of core loans and advances at 31 March 2025 was 1.39% | | | | | | | | | | | | | | Climate change mitigation Energy transition finance | Sustainable and Transition Finance Classification Framework | • Facilitate £14.9 billion of sustainable and transition finance by 2030 (measured in Pound Sterling) | • Set sustainable and transition finance targets to be reached by 2030 | • We published our enhanced framework in May 2024 and announced targets in May 2025 to facilitate £14.9 billion of sustainable and transition finance by 2030 | | | | | | | \* Financed emissions calculated one year in arrears. Financed emissions: Environmental policy and climate change statement The policy underscores our role in funding a sustainable economy and promoting carbon reduction as central to our climate change strategy. It states that we aim to reduce Scope 3 financed emissions by leveraging IBP’s expertise in advisory, lending and investing to support clients' transition to a low- carbon economy. The policy commits us to financing innovative solutions that accelerate decarbonisation, actively measuring and accounting for carbon emissions through participation in initiatives like PCAF. Furthermore, the policy outlines that environmental considerations are integrated into all lending and investment decisions. Additionally, we adopt a cautious and orderly approach to transitioning sectors critical to the economy, such as energy, balancing financial, socio-economic and environmental factors. • Scope of the policy: The policy covers the Investec Group which includes IBP. In addition to our own carbon footprint it focus on measuring and reducing emissions in our value chain relating to lending and investing activities • Accountability: For the Bank, accountability for the implementation lies with the Board. Any future targets set as part of our transition plan will be approved by IBP ERC, IBP BRCC and the Board. The Board will be accountable for progress against these targets • Publication status: This is a public policy last updated in December 2023 with a review cycle of every two years. This policy is on our [website here](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/Group-environmental-policy-and-cimate-change-statement.pdf). Tracking the effectiveness of our policy IBP monitors the effectiveness of its efforts to reduce Scope 3 emissions through regular progress updates to the DLC ESC. Our reported Scope 3 emissions undergo a rigorous verification and approval process involving individual business units, the IBP Chief Risk Officer and the IBP ESC. The emissions data is then presented to the DLC SEC through the annual reporting sign off process for oversight. Additionally, our transition plan will be developed using a bottom-up approach, incorporating input and ownership from relevant business units through the IBP SBF framework. We will track and report our progress toward emissions reduction targets to the Board, the IBP BRCC, the DLC ESC and the DLC SEC. This will ensure continuous oversight of progress towards our forthcoming targets. Actions and performance Over the past year, we have made significant progress in managing our financed emissions. By implementing stringent data collection processes, we have enhanced the accuracy, reliability and timeliness of our data inputs. This success was driven by close collaboration with our business units, allowing us to secure essential data points and verify their accuracy to maintain input integrity. Additionally, we invested substantial resources in automating the calculation of financed emissions using the PCAF methodology. This automation has improved alignment across various jurisdictions, ensured consistency in our methodologies, and streamlined our overall processes. Moreover, we expanded our scope to encompass all energy lending activities, moving beyond solely power generation within this asset class. Our planned actions to address financed emissions are centred on enhancing data quality, streamlining processes, expanding asset coverage, setting reduction targets and building internal capacity. 324 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | We are committed to improving our PCAF data quality score by refining our data collection practices and investing in automation to streamline calculations and reporting, minimising errors and increasing efficiency. Additionally, we plan to expand our coverage of asset classes, starting with facilitated emissions, for a more comprehensive assessment of our financed emissions. To support our commitment to improving the PCAF data quality score, IBP will continue to enhance our data collection infrastructure. We have also automated our calculations and reporting processes and allocated resources to system maintenance and training. Expanding our asset class coverage, starting with facilitated emissions, will require modifications and employee training. While measuring our financed emissions will not directly reduce GHG emissions, it provides a crucial roadmap for our client engagement strategies aimed at effectively lowering emissions. As part of our strategy, we will set emissions reduction targets using a bottom-up approach that involves close collaboration with our business units. This will be complemented by capacity-building initiatives within the Bank, empowering our teams to effectively assist and advise clients on their decarbonisation strategies. Setting emissions reduction targets through a bottom-up approach will involve data analysis and teamwork. Our capacity-building initiatives will include investments in learning, funding training programmes and workshops, ensuring our teams are equipped to advise clients on decarbonisation strategies. Metrics and targets IBP has not yet set specific financed emissions targets as we prioritise enhancing our data quality to ensure that any future targets are realistic and achievable. Over the past year, we have concentrated on refining our data collection processes, improving our PCAF data quality score, and investing in automation to streamline our calculations and reporting. High- quality, accurate data is essential for setting credible emissions reduction goals, and by focusing on this foundational work, we aim to create a solid basis for future target-setting. Once our data quality is robust, we will be well positioned to develop and implement meaningful financed emissions targets that align with our sustainability objectives and support our long-term goal of achieving net-zero emissions by 2050. We have calculated our Scope 3 financed emissions within six asset classes. These emissions amount to 3.04 million tCO2e. The table provided below contains a summary of our financed emission key metrics. The methodology for the calculations is specified in our BoR on our website. Economic intensity is calculated using the exposure value, measuring the carbon footprint of a our loan book and investment portfolio per Pound Sterling lend or invested. We have prepared the disclosure based on the prior period balance sheet and emissions data. Scope 3 emission calculation coverage of the IBP loan book The graph below illustrates the coverage of our loan book emissions, with 82% of our portfolio assessed. Of this, 59% has been calculated using established methodologies, while 14% lacks established methodologies, and 9% pertains to sectors with inherently low or no emissions, such as financial services, public services, and government exposures. Exposures to sovereigns and local authorities are generally treated as having limited or no financed emissions attributed, due to both methodological limitations and the nature of public sector spending, which is not always directly linked to identifiable, emission-generating assets. In many cases, public debt finances a wide range of activities, from education to infrastructure, making it difficult to allocate emissions with precision. Furthermore, governments often report on their own emissions separately in national greenhouse gas inventories under the UNFCCC, and double-counting is a risk. This coverage represents our best effort to comprehensively account for emissions within our loan book, given the current limitations of available methodologies and data. The remaining 18% of our loan book, primarily consisting of business loans, has not yet been calculated as we have focused to date on data quality. Our immediate focus remains on increasing data quality in those sectors where we have calculated financed emissions before expanding our scope of coverage. Moving forward, we are committed to expanding our scope where methodologies exist and high-quality data is available to enhance our emissions reporting. ![]() ![29686813950322]() | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Calculated | | | | Low or no emissions | | | | No methodology | | | | Not calculated | | | | | | | | | | | | | | | | | | | 325 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | 2024 | | | | | Asset class | Sector | | % of book covered | Scope 1 and 2 (tCO 2 e) | Scope 3 (tCO2 e) | Total emissions (tCO 2 e) | | | | | | | | | | Property | Commercial real estate | | 100% | 29 243 | — | 29 243 | | Residential real estate | | 100% | 2 589 | — | 2 589 | | Mortgages | | 100% | 15 281 | — | 15 281 | | | | | | | | | | Transport | Fleet finance: motor vehicles | | 100% | 168 572 | — | 168 572 | | Fleet finance: yellow equipment | | 100% | 110 478 | — | 110 478 | | Aviation | | 99% | 1 075 855 | — | 1 075 855 | | | | | | | | | | Energy | Power generation | | 100% | 1 106 690 | — | 1 106 690 | | Other energy lending | | 100% | 534 746 | 34 898 | 569 644 | | Equity | Listed equity | | 100% | 279 | 887 | 1 166 | | | | | | | | | | Total emissions | | | | 3 043 733\* | 35 785\*\* | 3 079 518 | \*Reported emissions includes the sum of Scope 1 and Scope 2 emissions. \*\* Client Scope 3 emissions are excluded from our reported number for finance emissions, as per PCAF guidelines. Fossil fuel financing: Fossil fuel policy The fossil fuel policy outlines the Investec Group's approach to fossil fuels across its lending, investing and advisory activities. Driven by a commitment to sustainability and the urgency of climate change, the policy details restrictions and conditions for financing coal, oil and gas projects. It also describes the Investec Group’s commitment to net zero by 2050, its adoption of screening for high-risk transactions, support for a just energy transition, and our approach to transparency and reporting on our fossil fuel exposure. • Scope of the policy: The policy encompasses the entire Investec Group, including IBP, and pertains to our clients throughout the value chain, specifically focusing on our lending, investing and advisory activities • Accountability: For the Bank, accountability for the implementation lies with the Board. Targets are approved by the Board, IBP ERC and IBP BRCC • Publication status: This is a public policy last updated in June 2023 with a review cycle of every two years. This policy is on our [website here](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/Investec-Fossil-Fuel-policy-June-2023.pdf). Tracking the effectiveness of our policy IBP tracks the effectiveness of its performance against the fossil fuel policy through continuous monitoring and management of existing oil and gas exposures, with a focus on minimising these exposures wherever possible in line with our fossil fuel policy commitments. To ensure implementation of this policy, the Group sustainability team performs screening on every oil and gas transaction. Where a transaction is not aligned with our fossil fuel policy, it will get escalated to the IBP ERC. Furthermore, all fossil fuel-related exposures are reported bi-annually to the Board, the DLC ESC and the DLC SEC. This allows us to assess our progress against our commitments and enables adjustments and strategic decisions to align with our sustainability goals. These communication channels ensure that our fossil fuel policy remains effective, adapts to emerging risks and aligns with our overarching commitment to gradually reduce fossil fuel exposure over time while taking into account any geopolitical or economic challenges. Actions and performance Our fossil fuel policy was updated in June 2023. We incorporated feedback from our business operations, the economic climate, and our risk appetite. We remain committed to continuously monitoring and managing our existing oil and gas exposures in line with this policy, placing a strong emphasis on minimising these exposures whenever possible. Over the long term, this strategic approach will lead to reductions in GHG emissions as we gradually transition away from oil and gas lending. However, in the medium to long term, we expect emissions to increase as we support transition finance initiatives, to facilitate the shift to a lower-carbon economy. Importantly, this initiative is already supported by our current capital and operational budgets, requiring no additional capital or operational expenditure. We have reduced our fossil fuel exposure as a percentage of our loan book at 31 March 2025 to 1.39%. Our progress against our fossil fuel commitments is presented bi-annually to the Board. Refer to our [energy lending](84S0VF8TSMH0T6D4K848-2025-03-31-T01.html#i447e4d363cd344738300acdd42f0e3a0_3004-bookmark-bc61adb414014d30aa1caddccad52497) [portfolio here](84S0VF8TSMH0T6D4K848-2025-03-31-T01.html#i447e4d363cd344738300acdd42f0e3a0_3004-bookmark-bc61adb414014d30aa1caddccad52497)[.](84S0VF8TSMH0T6D4K848-2025-03-31-T01.html#i447e4d363cd344738300acdd42f0e3a0_3004-bookmark-bc61adb414014d30aa1caddccad52497) Metrics and targets Companies to whom energy-related loans are made are identified using Standard Industry Classification (SIC) codes. Our classification encompasses exposures within gross core loans and advances (thus before impairments) for IBP. Fossil fuel exposures include those from the oil, gas and coal sectors, covering activities such as extraction, power plants, power generation, infrastructure and industrial processes. Renewable energy exposures include those from wind, solar, hydro, biomass and waste, as well as storage solutions for renewable energy. Certain exposures are excluded from this calculation and are accounted for separately. These exclusions include undrawn facilities, exposures with no credit risk, off-balance sheet exposures, trading exposures, indirect exposures to fossil fuels and exposures to petrol stations. IBP has set the following targets for its activities within the fossil fuel sector measured in Pound Sterling as a percentage of the IBP core loans and advances: • Zero coal exposure in the IBP loan book by 31 March 2027. This target was reached in September 2024 • Cease financing of new oil and gas exploration, extraction or production projects directly, regardless of jurisdiction, from 1 January 2035. 326 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | --- | | | | 31 March 2025 energy lending portfolio for Investec Bank plc | | (£’mn) | ![4398047134729]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Oil | | | Coal | | | Natural gas | | | Wind energy | | | Solar energy | | | Biomass energy | | | Energy from waste | | | Other and storage | Energy transition finance: Sustainable and Transition Finance Classification Framework Our approach to sustainable finance is underpinned by our commitment to driving positive environmental and social outcomes while ensuring long-term financial resilience. Guided by the EU Taxonomy and other internationally recognised frameworks, we have developed our Sustainable and Transition Finance Classification Framework to align our activities with global sustainability goals. This framework provides the environmental and social sustainable and transition finance classification criteria for sustainable and transition finance for the Investec Group. The framework utilises a traffic light system to classify environmentally sustainable finance activities (green), transition finance activities (amber) and activities that do not qualify as sustainable nor transition finance (red). Social sustainable finance activities are not classified by a traffic light system, but consider defined target populations and social outcomes. The framework is based on best practice guidelines and taxonomies, including the EU Taxonomy and principles from the Loan Market Association and the International Capital Market Association. The purpose of this framework is to guide the Investec Group’s lending activities in supporting a more sustainable future and the transition to a low-carbon economy while also addressing social sustainability. • Scope of the framework: The framework encompasses the entire Investec Group, including IBP, but excludes the Investec Wealth & Investment business. It specifically pertains to our clients within the value chain, focusing primarily on our lending activities • Accountability: For the Bank, accountability for the implementation lies with the Board. Targets are approved by the Board, IBP ERC and IBP BRCC • Publication status: This is a public framework which was last updated in May 2024, with a review cycle of two years. This framework is on our [website here](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/Investec-Sustainable-and-Transition-Finance-Classification-Framework.pdf). | | | --- | | | | 31 March 2025 breakdown of Investec Bank plc energy portfolio (%) | ![4398047134795]() | | | | | --- | --- | --- | | | | | | | | Mar '25 | | | Coal | —% | | | Oil | 0.94% | | | Natural gas | 25.09% | | | Renewables | 73.97% | Tracking the effectiveness of the framework IBP tracks the effectiveness of the Investec Group’s Sustainable and Transition Finance Classification Framework through a structured and collaborative approach facilitated by the IBP SBF, which is mandated by the IBP Executives and meets fortnightly. This forum, composed of business unit representatives, management and Executives, plays a pivotal role in promoting knowledge sharing and fostering collaboration across the Bank. By regularly identifying and evaluating sustainability-related commercial opportunities, the forum aims to assist the Group sustainability team in ensuring that the Sustainable and Transition Finance Classification Framework remains dynamic and responsive to emerging trends and challenges. Additionally, the Sustainable Business Forums coordinate key sustainability projects, including the establishment and monitoring of the sustainable and transition finance target, which serve as a measurable indicators of the Framework’s impact. The effectiveness of the Sustainable and Transition Finance Classification Framework is further monitored through reporting mechanisms, whereby the chair of the IBP SBF communicates significant sustainability-related matters to the DLC ESC and, when relevant, to the IBP ERC, IBP BRCC and the Board. This continuous feedback loop allows IBP to assess progress against the sustainable and transition finance target, make informed adjustments and ensure alignment with the Bank’s strategic goals, thereby maintaining the Framework’s relevance and effectiveness in driving sustainable growth. 327 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Actions and performance IBP is dedicated to advancing sustainable and transition finance initiatives through a series of actions. We have enhanced our source systems to accurately capture and report these finance activities, ensuring precise and reliable data management. Over the past year, our teams engaged in a comprehensive process to analyse and screen their loan portfolios for existing sustainable and transition finance activities. The IBP SBF played an instrumental role in facilitating discussions and providing support to our businesses. Following an initial review, the business units evaluated the financing landscape and economic activities specific to their business areas to set targets for advancing sustainable and transition finance initiatives through to 2030. This process underwent multiple iterations, with management and leadership challenging the teams to ensure that the target was sufficiently ambitious and progressive. Ultimately, the individual targets from each business unit were consolidated to establish IBP's overall sustainable and transition finance target, which was presented to the Board for approval. In each year’s annual reporting, we will publish updates on our progress toward the sustainable and transition finance target, conducting periodic reviews and making adjustments as necessary to stay on track. This commitment is integral to our goal of achieving net-zero emissions by 2050. While our sustainable and transition finance initiatives may not directly result in immediate GHG emission savings, they are strategically designed to shift our loan portfolio away from high carbon-emitting sectors over time. We aim to innovate and scale our financial products to meet the evolving needs of our clients, supporting their transition to lower-carbon operations. Through our forthcoming client engagement strategy, we will collaborate with clients to assess climate risks and develop their own decarbonisation pathways, facilitating a gradual reduction in our indirect carbon emissions by financing more sustainable and low-emission projects. Importantly, these initiatives are anticipated to be managed primarily using our existing capital and operational resources, though additional expenses may be incurred in the future as needs arise. These potential expenditures will be assessed on a case-by-case basis when necessary, given that they are driven by future developments. Metrics and targets The sustainable finance target setting was the result of a rigorous, bottom-up approach involving extensive consultations across our business units, executive teams and the Board. By engaging stakeholders at all levels of the Bank, we established a clear and credible sustainable and transition finance target that reflects both the needs of our clients and our commitment to responsible growth. This collaborative process ensured that our sustainable finance strategy is robust, transparent and fully integrated into our operations. In addition, this approach ensures that the target is both ambitious and credible, while at the same time allowing us to stretch ourselves while maintaining impact and commercial viability. This methodology entailed collecting insights and feedback from various business units within the Bank, beginning with teams that are directly involved in commercial activities. These inputs were synthesised and refined through several iterations with the business and presented to the IBP CEO, ensuring that the target was grounded in practical considerations and real- world conditions. The determination of the target was incorporated into the annual budget and risk appetite review processes. Following this comprehensive development process, the target was reviewed by the IBP ERC, before being recommended for approval to the IBP BRCC and the Board. Our sustainable and transition finance target was determined based on projected new financing and refinancing of existing facilities. Repayments and redemptions over time do not decrease cumulative progress against the target. Furthermore, for lending and advisory transactions where IBP acts as the lead arranger, the full facilitated amount will accrue to the target, and where IBP acts as a co-arranger or in syndication, a proportional amount will accrue to the target. IBP has set a target to facilitate £14.9 billion of sustainable and transition finance by 2030. The target commences with the 2026 financial year, starting on 1 April 2025, and spans a period of five years. While IBP will begin accruing progress from zero, this starting point does not reflect the sustainable and transition financing activities undertaken by IBP in previous years, as we have only recently developed the capability to formally classify eligible deals and measure progress against a defined target. This target is measured in Pound Sterling (absolute value). #### Resilience of our strategy and business #### model in relation to climate change The Bank of England’s 2021 Climate Biennial Exploratory Scenario’ serves as the framework for our scenario analysis. This stress test aims to evaluate the resilience of banks against a variety of adverse economic conditions, particularly those related to climate change and other systemic risks. The objective is to determine how well institutions can endure shocks such as economic downturns, market volatility or significant shifts in climate-related factors. These stress tests are crucial for identifying vulnerabilities within the financial system, ensuring that banks maintain sufficient capital buffers and effective risk management practices to mitigate potential losses. Although the BoE/PRA did not conduct a repeat of the Climate Biennial Exploratory Scenario (CBES21) exercise, the principles established in the Bank’s 2022 assessment remain relevant. In Supervisory Statement SS3/19, the Prudential Regulation Authority (PRA) outlines its expectations for firms to assess climate-related financial risks over both short and long-term time horizons. Specifically, firms are expected to conduct scenario analyses that encompass: The climate scenario analysis was carried out at the Investec plc level, which encompasses IBP as a subsidiary, thereby ensuring it was adequately included in the stress test. 328 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | During 2024, Investec plc carried out its climate risk assessment which was broadly a repeat of the 2022 climate risk assessment. For each of the assessed sectors (property, transportation, energy and manufacturing), a transition narrative was developed. This narrative focused on key technological and policy/ legislation measures necessary to achieve decarbonisation, specific to each sector. Due to the high uncertainty of both technological readiness and the duration of the policy/legislation process (including jurisdictional misalignment of scope and timing), no specific timeframe was specified in these narratives. The aim was to focus on understanding the impact of the sector-specific transition narrative on top 100 assets within IBP’s portfolio, and through this process assess whether there are any high risk- assets in the portfolio. In addition, a flood risk assessment on HNW mortgages within Investec plc’s top 100 assets was performed. This risk assessment can therefore not be tied to any specific timeframe, though it is noted that in reality sectoral timeframes for full decarbonization can range from several years to multiple decades. This approach is proportionate to the scale and complexity of the firm, in line with SS3/19. Sectors were all assessed for transition risk and HNW mortgages were assessed for physical risk. Moreover, the exposures in the asset level review were also assessed against the “traffic light system” in the Group’s Sustainable and Transition Finance Classification Framework. Property sector The property sector faces climate transition and physical risks, with flooding emerging as a primary concern in the UK. Decarbonising this sector requires substantial improvements in insulation and the electrification of space and water heating, which can impose considerable costs on property owners and landlords, especially as they navigate tighter regulations recently reintroduced by the UK Labour Government. Enhancing the energy efficiency of buildings in the UK through measures such as improved insulation and the transition to electric heating systems, is critical. Furthermore, stricter rules regarding energy efficiency will be implemented for rental properties, aimed at reducing carbon emissions across the sector. Transition risk event – mandates on and regulation of existing products and services: The implications of the evolving EPC requirements present a key risk, as all residential tenancies for private landlords will need to achieve a minimum EPC rating of C by 2030, while commercial tenancies must meet this standard by April 2027, escalating to B by the same year. Additionally, the ban on gas boilers in new buildings after 2025 will lead to further transition costs for property owners. However, IBP has identified mitigants to address these challenges. Exemptions to the minimum EPC requirements exist for listed buildings or older properties with capped EPC ratings, and notably, more than 90% of HNW mortgages have valid EPC ratings, complying with existing regulations. IBP also provides lending facilities specifically for energy-efficiency improvement works, ensuring that all new lending adheres to minimum EPC and Building Research Establishment Environmental Assessment Methodology (BREEAM) standards, which enhances the quality of our loan book over time. Most HNW mortgages are for owner-occupied properties, particularly those with lower EPC ratings, where compliance with minimum EPC requirements is less of a concern. Our top real estate exposures primarily consist of new builds that meet the target EPC ratings. Physical risk event – floods: Additionally, the increasing flood risk associated with climate change, exacerbated by more frequent and intense flooding events, poses further challenges. IBP mitigates this risk through stringent lending criteria for HNW individuals, significantly reducing default risk even when the underlying properties are exposed to climate risks. Transportation (aviation) sector The aviation sector faces significant transition risks related to climate change, primarily due to the difficulty in reducing carbon emissions from jet engines, especially for long-distance flights. These transition risks are exacerbated by rising fuel prices, particularly for sustainable aviation fuel (SAF), as well as taxes aimed at financing carbon emission offsetting efforts and demand management strategies. The global nature of the aviation industry necessitates extensive policy coordination, which may slow down the legislative process required to decarbonise the sector. Transition risk event – increased pricing of GHG emissions: Transition risk may arise due to cost increases, such as taxes on jet fuel, rising airport landing slot prices, and fines for noise infringements. Airlines can mitigate these risks by optimising their route offerings and scheduling in response to fines and incentives, such as taking advantage of reduced landing fees at certain airports. 329 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Transition risk event – mandates on and regulation of existing products and services: Tightening regulations could include bans on ultra-short-haul flights, grounding of older aircraft that do not meet minimum emission standards and mandatory requirements for aircraft seating arrangements, such as economy class only. The impact of such legislation will largely depend on whether it is enforced in the aircraft’s state of registry or the state of operation. Transition risk event – changing customer behaviour: Social trends and changing consumer preferences are also influencing the aviation sector, with an increasing adoption of SAF, albeit at a higher cost due to limited supply. Customers are beginning to opt for more environmentally friendly alternatives, such as train travel. In response, many major airlines are actively investing in SAF production facilities to enhance availability and reduce costs over time. Despite these challenges, the demand for air travel remains inelastic, presenting an opportunity for airlines to adapt their strategies while still meeting consumer needs. Energy sector The transition narrative in the energy sector is intrinsically linked to the technology employed. The complexities of the energy transition, coupled with evolving government policies, prevent us from drawing straightforward conclusions at the asset level. For instance, while older energy plants may face challenges, they may still be necessary for maintaining energy capacity and grid stability. Transition risk event – shifts in consumer preferences: We acknowledge a global shift away from non-renewable energy sources, with a strong move towards renewable energy production. As part of our mitigation strategy, we view natural gas as a transition fuel, with many combined cycle gas turbine (CCGT) plants capable of running on hydrogen. Our largest energy assets are strategically positioned in the UK and the highly diversified US market. Transition risk event – substitution of existing products and services with lower emissions options: The merit order of CCGT plants is another critical consideration. Older, non-renewable plants are likely to rank lower in efficiency, pollution levels and operational costs, increasing their risk of becoming stranded assets. However, due to their relatively young profile, the CCGTs in our top exposures are generally ranked mid to high on the merit order, securing revenue through capacity market agreements with counterparties. Transition risk event – mandates on and regulation of existing products and services: The introduction of carbon-related legislation, including laws, standards and taxes that mandate retrofitting carbon capture technology, presents both challenges and opportunities. Our portfolio of relatively young CCGTs positions us advantageously, as they can be retrofitted more easily and cost-effectively, while their higher efficiency means they are likely to emit less than older plants. Transition risk event – uncertainty in market signals: We recognise the dynamics in the energy-from-waste (EfW) market, where improved landfill waste management practices are expected to reduce waste supply to EfW plants. Despite this, we believe the EfW market will remain competitive due to higher landfill taxes compared to EfW gate fees. Manufacturing sector The transition narrative for the manufacturing sector is intricately linked to the energy sector, particularly as the highest carbon-emitting industries face significant transition risks. While electrification may be a viable option for certain sub-sectors, more energy-intensive industries, such as cement manufacturing, are hard to abate. Manufacturing is a crucial component of the UK economy, and recent declines in emissions can be attributed to reduced energy intensity in combustion-based processes and shifts in the fuel mix. To further decarbonise the sector, it will be essential to implement strategies such as process innovation, electrifying the energy system and deploying carbon capture technologies at concentrated sources. Transition risk event – increased pricing of GHG emissions: The dynamics of pollution permits and energy trading schemes operating on a cap-and-trade basis for total emissions present a key risk for IBP, as manufacturers may experience reductions in revenue and cash flow while adjusting production levels to comply with carbon permit limits. Transition risk event – mandates on and regulation of existing products and services: The introduction of carbon standards and taxes could require products from high-emission industries to meet specific carbon content or recycled content thresholds. This shift may lead to increased costs for high-emitting companies, particularly if these standards are enacted before low-carbon technologies are fully developed, potentially impacting the financial performance of our clients in these sectors. Transition risk event – costs of transition to lower emissions technology: The role of subsidies is critical in supporting the adoption of emerging technologies, such as green hydrogen and post-combustion air capture. Without these subsidies, some manufacturers could face elevated costs associated with in-house low-carbon research and innovation, which may hinder decarbonisation efforts. While these measures will predominantly affect the highest-emitting industries, it is important to note that the key risks associated with them are largely mitigated by the composition of IBP’s manufacturing portfolio, which primarily includes assets in industries with low emissions intensity. 15 https://unfccc.int/sites/default/files/part1\_iiasa\_rogelj\_ssp\_poster.pdf 330 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Overall findings The overall findings from this risk assessment indicate that, consistent with the results in 2022, the climate transition and physical risks are low for the Bank over a 5–10-year horizon. We have adequate capital and liquidity to operate as a going concern while meeting regulatory capital and liquidity requirements. This stability reinforces our confidence in the robustness of our financial position and our ability to navigate potential challenges in the evolving climate landscape. As we move forward, we remain committed to refining our strategies and enhancing our resilience in the face of climate change. Our approach currently contains a number of uncertainties. It depends on accurate site-level data, including geo-coordinates and asset values, which vary in quality across the portfolio. Additionally, further work is needed to develop a clear methodology for differentiating between leased and owned assets and whether to include supply chain risks for certain companies. Additionally, this resilience analysis was not considered during the DMA, as the assessment was still underway at that time. Within our own operations We conduct physical risk assessments related to our operations at least every three years, recognising that such evaluations are cost-intensive and that our portfolio remains largely stable within this period. In our latest assessment conducted in 2025, we focused on precipitation-related hazards, including surface water flooding, general flooding, coastline risks and rising temperatures. We assessed this risk using the three Shared Socio-economic Pathways (SSP) from UNFCCC 15, as described below. • SSP1-2.6 is a climate change scenario that envisions a sustainable future through strong global cooperation around governance and environmental policies, and rapid technological advancements. It focuses on sustainable development, aims for a significant reduction in GHG emissions, and targets a low radiative forcing of 2.6 W/m² by 2100, aligning with a 1.5–2°C warming target equivalent to the RCP2.6 scenario in the IPCC's Sixth Assessment Report (AR6) • SSP2-4.5 represents a middle-of-the-road scenario with moderate challenges to climate mitigation and adaptation. It combines the SSP2 scenario with a medium-level forcing pathway (RCP4.5) of 4.5 W/m² by 2100, predicting that GHG emissions will initially remain stable, decline mid-century, but not reach net zero by 2100, resulting in a global temperature rise of about 2.1–3.5°C, with a central estimate of ~2.7°C • SSP3-7.0 represents a scenario of high global warming (with a likely temperature increase of ~3.9°C by 2100) based on assumptions of no additional climate policies and a reduction in air pollution controls, leading to increased aerosol emissions. This scenario combines a fragmented, regional rivalry SSP3 narrative with a high forcing level reaching ~7.0 W/m² by 2100, and is used to explore outcomes under weak international cooperation. For precipitation, the UK is expected to have drier summers and wetter winters, with regional differences depending on the climate scenario. Across all scenarios, the number of extreme precipitation days, defined as days with more than 20mm of rain, is projected to increase. Under SSP1-2.6, most Investec offices are expected to see only minor changes, with slightly higher increases in Dublin and Glasgow. SSP2-4.5 shows broader increases, particularly for offices in southern and central England. SSP3-7.0 projects widespread rises across the UK and Ireland. Regarding temperature, from 2024 to 2050, only the London office is projected to experience a small increase in days exceeding 30°C under SSP1-2.6. Under SSP2-4.5 and SSP3-7.0, the number of such days is expected to rise for London and other southern offices, including Reading and Guildford, while offices in Glasgow, Leeds and Dublin will remain less affected. These changes in precipitation and temperatures could impact the health and wellbeing of our employees in high-risk locations, however our analysis confirmed that there are no concerns regarding the resilience of IBP. IBP manages these risks through robust operational resilience strategies and business continuity plans, which include emergency response procedures. This proactive approach ensures that we can effectively mitigate the physical risks associated with climate change, protecting our employees and maintaining our operational stability. Current financial effects of material IROs The Group makes use of reasonable and supportable information to make accounting judgments and estimates related to climate change, including the observable impacts on clients' current credit risk and asset valuations. Many climate change effects are long term and inherently uncertain, having minimal influence on accounting judgements and estimates for the current period. Key short-term climate change impacts include: • Expected credit loss (ECL) measurement: ECL assessments evaluate borrowers' ability to make contractual payments as they become due. Investec has assessed specific sectors most vulnerable to climate risk across all jurisdictions, focusing on clients' capacity to meet their financing needs and Investec’s willingness to fund these sectors. While these assessments have not materially affected ECL, the impact on probability of default (PD), loss given default (LGD) and other ECL inputs is still being determined • Asset impairment and deferred tax assets: Assessments of asset impairment, based on value in use, and the recognition of deferred tax assets depend on future expected cash flows. These cash flows reflect management’s best estimates of operational results, including the near-term effects of climate risk. The Group has not made additional adjustments to cash flows for climate risk within the considered time frame, assuming that market indicators used for fair value inputs already incorporate current information and insights regarding climate risk. 331 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | --- | | | | | #### EU Taxonomy This section presents IBP’s first disclosure under the EU Taxonomy Regulation (EU) 2020/852, focusing on activities contributing to all six environmental objectives, as per Article 10(5) of the Commission Delegated Regulation (EU) 2021/2178. The EU Taxonomy is a comprehensive classification system established by the European Union to define and standardise what constitutes environmentally sustainable economic activities. Its primary aim is to direct investments toward projects and businesses that significantly contribute to the EU’s environmental objectives, including climate change mitigation and adaptation, sustainable use and protection of water and marine resources, transition to a circular economy, pollution prevention and control, and the protection and restoration of biodiversity and ecosystems. We have disclosed the required information at the Investec plc level in accordance with Section 1.1.1 of Annex V, which states, “Credit institutions shall disclose relevant KPIs based on the scope of their prudential consolidation determined in accordance with Regulation (EU) No 575/2013, Title II, Chapter 2, Section 2.” The EU Taxonomy disclosures presented are subject to several limitations, primarily stemming from data availability and the evolving regulatory landscape. For the reporting period, assessments were conducted on a best-efforts basis using publicly available information and internal records where available. Direct counterparty engagement was not undertaken, which limited the ability to verify eligibility and alignment for certain exposures. As a result, a conservative approach was adopted, and where technical screening criteria (TSC), Do No Significant Harm (DNSH) evidence or minimum safeguards could not be sufficiently demonstrated, exposures were not assessed for alignment. The EU Taxonomy disclosures as at 31 March 2025 are subject to limited assurance as set out on page [357](#i447e4d363cd344738300acdd42f0e3a0_3914). #### Methodology We have followed the methodology prescribed in Annex V and Annex XI of Commission Delegated Regulation (EU) 2021/2178 and included the prescribed templates as per Annex VI which is available in the Appendix of this annual report: • Activities eligible under the EU Taxonomy • Activities aligned with the TSC, DNSH requirements, minimum safeguards and contributed substantially to one or more of the environmental objectives. The TSC was performed using desk top analysis. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 1 | | 2 | | 3 | | 4 | | 5 | | | | | | | | | | | | Identification of eligible economic activities | | Analysis of substantial contribution | | DNSH assessment to other environmental objectives | | Verification of minimum safeguard | | Calculation of financial metrics | | | | | | | | | | | | | | | --- | --- | | | | | 1. | Identification of eligible economic activities | We conducted a structured review of our covered assets to identify economic activities eligible under the EU Taxonomy Regulation, aligning with the Nomenclature of Economic Activities in the European Community (NACE) codes specified in the Delegated Acts. This process involved the systematic mapping of counterparties’ primary business activities and financed projects to the relevant NACE codes and activity descriptions outlined in the Delegated Acts for climate change mitigation and adaptation. Eligibility assessments were conducted based on available client documentation, internal credit records and publicly disclosed information to derive counterparty level taxonomy KPIs. We have not contacted individual counterparties for data. 332 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | 2. | Analysis of substantial contribution | Due to our client base and the limited exposures we have in the EU that fall under the Non-Financial Reporting Directive (NFRD) disclosures, we did not conduct a technical screening for most of our counterparties to assess substantial contribution. In such cases, we adopted a conservative stance in line with regulatory guidance, and the exposure was classified as eligible but not aligned. For the remaining counterparties which are Taxonomy-eligible activities we assessed for Taxonomy-alignment using the TSC for substantial contribution as outlined in the Delegated Acts. We conducted an assessment of whether the financed activities make a substantial contribution to the environmental objectives. Where counterparties had not yet disclosed sufficient technical data to demonstrate compliance with the TSC, alignment was not confirmed. In such cases, we adopted a conservative stance in line with regulatory guidance, and the exposure was classified as eligible but not aligned. | | | | --- | --- | | | | | 3. | DNSH assessment to other environmental objectives | As part of the EU Taxonomy alignment process, we assessed whether activities that make a substantial contribution also comply with the DNSH criteria. This assessment was conducted based on the activity-specific DNSH requirements set out in the Delegated Acts. We relied on available client disclosures, where available internal environmental and social due diligence, and publicly accessible information. In cases where clients did not provide sufficient evidence to confirm compliance with the DNSH criteria, the activities were conservatively treated as eligible but not aligned. | | | | --- | --- | | | | | 4. | Verification of minimum safeguards | To verify compliance with the EU Taxonomy’s minimum safeguards, we assessed whether counterparties engaged in potentially aligned activities operate in accordance with international standards on human rights, labour rights, anti-corruption and responsible business conduct, as outlined in Article 18 of the EU Taxonomy Regulation. This included reference to the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises, the United Nations (UN) Guiding Principles on Business and Human Rights, the International Labour Organization’s (ILO’s) core conventions and the UN Global Compact (UNGC) principles. The assessment leveraged existing Know Your Client (KYC) procedures, and publicly available data to evaluate governance practices, human rights risks and business ethics. Where there was insufficient evidence of compliance with these standards, the exposures were classified as eligible but not aligned. | | | | --- | --- | | | | | 5. | Calculation of financial metrics | The financial metrics disclosed under the EU Taxonomy have been calculated in accordance with Article 8 of Regulation (EU) 2020/852 and the methodology set out in Commission Delegated Regulation (EU) 2021/2178, specifically Annex V and Annex VI for credit institutions. We applied the prescribed calculation approach to determine the green asset ratio (GAR), which reflects the proportion of Taxonomy-aligned exposures within our total covered assets, excluding exposures to central governments, central banks, supranational entities, trading book positions and on-demand interbank loans. Numerators and denominators were derived from the consolidated balance sheet prepared under IFRS and reconciled to internal management reporting systems. The calculation distinguishes between Taxonomy-eligible and aligned exposures based on assessments of substantial contribution, compliance with DNSH criteria and verification of minimum safeguards. Where applicable, off-balance sheet exposures were considered in accordance with the relevant regulatory guidance. 333 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Green asset ratio (GAR) The GAR is supported by detailed templates in compliance with Annex VI of Commission Delegated Regulation (EU) 2021/2178, which outline the disclosure requirements for credit institutions. It is calculated by dividing the amount of taxonomy-aligned assets we finance (the numerator) by the total assets financed under GAR, known as 'Total GAR assets' (the denominator). These regulatory templates are included in the Appendix on page [363](#id106828438a44cdab7af4b69777ed95f_0-0-1-1-2753111) and provide a comprehensive breakdown of Investec plc’s balance sheet items according to the EU Taxonomy. The Taxonomy-aligned assets identified in these templates are used to calculate our GAR. We acknowledge that our GAR are notably low, primarily due to our client base and minimal exposures in the EU that fall under the Non-Financial Reporting Directive (NFRD) disclosures. On balance sheet assets included in the calculation of the GAR are financial assets, including loans and advances, debt securities, equity holdings and repossessed collateral as follows: • Financial assets at amortised cost • Financial assets at fair value though other comprehensive income • Investments in subsidiaries • Interests in associated undertakings and joint venture holdings • Financial assets designated at fair value through profit or loss. The following are excluded from the numerator of the GAR: • On demand interbank loans • Exposures to undertakings that are not not obliged to publish non-financial information pursuant to Article 19a or 29a of Directive 2013/34/EU. The following are excluded from the numerator and the denominator of the GAR: • Financial assets held for trading • Central governments and supranational issuers • Central bank exposures. For the calculation of the KPIs the following off-balance sheet exposures were included: • Financial guarantees supporting loans and bonds as defined in the Disclosure Delegated Act • Assets under management (AuM) for guarantee and investee non-financial undertakings. Other off-balance sheet exposures such as commitments is excluded from that calculation. Flow GAR KPIs Due to data limitations, GAR flow KPIs were calculated based on total new loans and advances originated in the reporting period without adding back repayments, and based on total new bond purchases in the reporting period without adding back disposals. In line with the Commission Notice on the interpretation and implementation of certain legal provisions of the Disclosures Delegated Act under Article 8 of the EU Taxonomy Regulation on the reporting of Taxonomy-eligible and Taxonomy-aligned economic activities and assets (C/2024/6691) (“Third Commission Notice”) dated 8 November 2024, the taxonomy- aligned lending is calculated as the percentage of taxonomy- aligned turnover and capital expenditure (CapEx) reported by each counterparty, applied to our loan exposure to each counterparty. Consequently, the proportion of counterparties in a bank’s banking book that are subject to the NFRD and CSRD is a key determinant of the resulting GAR. We apply the stock and flow approach as required by the EU Taxonomy. Where eligible financial instruments were originated in the prior financial year but the first drawdown occurred in the current reporting period, these are treated as flows for the purpose of Taxonomy reporting. This reflects the economic reality that the capital was first made available to the client in the current year, aligning with the principles of consistency and comparability across reporting periods. We have not included the EU Taxonomy templates for nuclear energy and fossil gas in our disclosure, as we do not have any direct exposures to these activities within the EU. While we may have exposures to financial institutions that themselves have exposure to these sectors, those counterparties are not currently subject to the NFRD and are therefore not required to publish their Taxonomy-aligned disclosures. As a result, we do not have the necessary underlying data to complete the nuclear and fossil gas templates in a meaningful or reliable manner. 16 Based on the turnover KPI of the counterparty. 17 Based on the CapEx KPI of the counterparty, except for lending activities where for general lending turnover KPI is used. 18   Percentage of assets covered by the KPI over banks´ total assets. 19 For credit institutions that do not meet the conditions of Article 94(1) of the CRR or the conditions set out in Article 325a(1) of the CRR. 20 Fees and commissions income from services other than lending and AuM. 334 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Templates • We have presented the below templates in the Schedule to the Sustainability Statement on page [363](#id106828438a44cdab7af4b69777ed95f_0-0-1-1-2753111) and onwards of the annual report • Nuclear and Gas templates: We have not reported on Templates 2 to 5 under Annex XII, as the conditions outlined in rows 1 to 6 of the Nuclear and Fossil Gas Template 1 are not applicable to our activities. | | | | | | --- | --- | --- | --- | | | | | | | Templates | | Description | Page ref | | Green asset ratio | | | | | 1. Assets for the calculation of GAR | | Taxonomy-eligible exposures and taxonomy-aligned loans, analysed by asset class | [364](#i8a1ec7875eeb4f44981c702b295969a0_7289) | | 2. GAR sector information | | Taxonomy-eligible exposures and taxonomy-aligned loans to non-financial undertakings (other than mining and quarrying), analysed by NACE sector | [372](#i2d2f422ff2404628950e2b26a859ea5a_6153) | | 3. GAR KPI stock | | Taxonomy-eligible exposures and taxonomy-aligned loans, analysed by asset class, as a percentage of entities subject to NFRD/CSRD which report Taxonomy information, and as a percentage of total assets | [374](#ia284248b3db8460eada5d1887397a84e_3674) | | 4. GAR KPI flow | | New taxonomy-eligible exposures and new taxonomy-aligned loans as a percentage of new entities subject to NFRD/CSRD which report Taxonomy information, analysed by asset class | [382](#if0fca987ad964a5abea7ff8480d60b69_1767) | | 5. KPI off-balance sheet exposures | | Taxonomy-eligible financial guarantees and AuM and taxonomy-aligned financial guarantees and AuM, as a percentage of financial guarantees and AuM that are CSRD eligible | [390](#i447e4d363cd344738300acdd42f0e3a0_3845) | | Nuclear energy and fossil gas-related disclosures | | | | | Template 1 – Nuclear and fossil gas- related activities | | | 391 | | Template 2 –Taxonomy-aligned economic activities (denominator) | | N/A as we do not have exposures to NFRD entities involved in nuclear or gas activities | | | Template 3 – Taxonomy-aligned economic activities (numerator) | | N/A as we do not have exposures to NFRD entities involved in nuclear or gas activities | | | Template 4 – Taxonomy-eligible but not Taxonomy-aligned economic activities | | N/A as we do not have exposures to NFRD entities involved in nuclear or gas activities | | | Template 5 –Taxonomy non-eligible economic activities | | N/A as we do not have exposures to NFRD entities involved in nuclear or gas activities. | | Summary of KPIs to be disclosed by credit institutions under Article 8 of the EU Taxonomy Regulation | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | 31 March 2025 | | Total environmentally sustainable assets (£’000) | Turnover KPI (%)15 | CapEx KPI (%)16 | % coverage (over total assets)17 | % of assets excluded from the numerator of the GAR | % of assets excluded from the denominator of the GAR | | Main KPI | GAR stock | 25 059 | 0.11% | 0.13% | 75% | 61% | 25% | | | | | | | | | | | 31 March 2025 | | Total environmentally sustainable activities (£’000) | Turnover KPI (%) 16 | CapEx KPI (%) 17 | % coverage (over total assets) 18 | % of assets excluded from the numerator of the GAR | % of assets excluded from the denominator of the GAR | | Additional KPIs | GAR (flow) | 1 515 | 0.06% | 0.07% | 7.87% | 4.42% | —% | | Trading book 19 | n/a | n/a | n/a | n/a | n/a | n/a | | Financial guarantees | — | —% | —% | —% | —% | —% | | AuM | — | —% | —% | —% | —% | —% | | Fees and commissions income 20 | n/a | n/a | n/a | n/a | n/a | n/a | 335 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | --- | | | | | #### Our people Investec’s purpose of creating enduring worth informs how the organisation builds strategy and delivers value to our stakeholders. Our purpose inspires us to create a working environment that shows deep respect for individuals, prizes inclusion and enables Out of the Ordinary performance. We do this through our organisational philosophies and values which underpin and instruct conduct and aligned behaviours. Our people enable us to fulfil our purpose. Our employee value proposition positions our culture as the core of the organisation. We recognise that enabling an engaged and diverse workforce that is deeply skilled and culturally embedded is essential for our success. Our culture is the way we do things, guided by our purpose and strengthened by our values. Key components of our employee value proposition include our purpose, values and culture, meaningful communication and engagement, performance, recognition and reward, people development and internal mobility, continuous learning, belonging and inclusion, and wellbeing. #### Material IROs relating to our people The outcome from our DMA indicated that our diversity and inclusion initiatives, as well as our wellbeing programme, positively impacts our employees, by creating a sense of belonging for all employees and providing preventative and proactive wellbeing initiatives. While we recognise the potential financial risks associated with employee turnover, we mitigate these through our remuneration approach which is designed to foster a high-performance culture that enables an entrepreneurial spirit and a strong sense of ownership. We use remuneration to attract and retain culturally aligned, innovative and talented people, and to drive and recognise Out of the Ordinary performance. These IROs materialise within our own operations. | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | ESRS S1: Our people | | | | | | Value chain | | | Affected business model | | PI | Working conditions: • Employee rights: Our purpose inspires us to create a working environment that shows deep respect for individuals, prizes inclusion, enables Out of the Ordinary performance and offers equal treatment and opportunities for all • Diversity: Our diversity and inclusion framework aims to create a sense of belonging for all employees, where everyone can be themselves. In the face of a rapidly changing geopolitical landscape, we have reaffirmed our unwavering commitment to diversity, belonging and inclusion throughout the organisation Entity specific: • Employee mental health and wellbeing: Aligned to our core values of care and concern for employees we offer a comprehensive wellbeing programme | | | | | Own operations | | | Own operations | | | | | | | | | | | FR | Working conditions: • Employee remuneration: Potential costs related to employee turnover | | | | | | | | | | | | | | | | | FO | Working conditions: • Employee rights: Attracting and retaining an engaged and diverse workforce thereby reducing turnover costs. Equal treatment and opportunities for all • Diversity: A diverse workforce may drive profitability through diverse perspectives and creativity Entity specific: Employee mental health and wellbeing: Enhanced employee productivity, reduced absenteeism and turnover, and a more engaged and resilient workforce | | | | | | | | | | | | | | | | | | | Key | | | | | | | | | | | NI | Negative impact | FO | Financial opportunity | | | | | | | | PI | Positive impact | FR | Financial risk | | | | | | | 336 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | We remain committed to implementing comprehensive policies and practices that address our material matters, which include employee remuneration, diversity and employee rights. These policies and practices are designed to create an inclusive and supportive workplace that values the unique contributions of every employee while prioritising their wellbeing and ensuring meaningful reward aligned to performance. The following table shows the IROs identified, along with the policies, actions and performance associated with each. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Topic and sub-topic | Policies | Targets | Actions | Performance | | | | | | | | Working conditions Employee rights | • Human rights statement • Discrimination statement Both these statements are available on our website in [The way we do business](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/The-Way-We-Do-Business-June-2021.pdf) statement | • No targets set | • Remaining committed to the Ten Principles of the UNGC • Ongoing commitment to support the UK Modern Slavery Act 2015 (the Act) | • 10 formal complaints were received, through channels for own workforce to raise concerns, including via whistleblowing mechanisms. 3 of the 10 resulted in findings of discrimination. | | | | | | | | | | | | | | Working conditions Employee remuneration | • [Remuneration philosophy](84S0VF8TSMH0T6D4K848-2025-03-31-T01.html#i447e4d363cd344738300acdd42f0e3a0_250-bookmark-a5761ddd3a674d09a48e8fcb7af60e3f) | • No targets set | • Investec remains supportive of a minimum living wage. 100% of employees paid above the relevant minimum statutory wage • All full-time employees continue to be eligible to participate in the employee share incentive scheme | • Mean hourly gender pay gap 23.8% (please note the population and timeframe for the CSRD reporting differs to that reported in the Investec Group Remuneration Report) | | | | | | | | | | | | | | Equal treatment and opportunities for all Diversity (belonging, inclusion and diversity) | • Board diversity policy • [Women in Finance Charter](https://www.investec.com/content/dam/united-kingdom/downloads-and-documents/investor-relations/the-women-in-finance-charter-report-2024.pdf) | • 40% female representation on the Board • 35% representation of women in senior leadership roles by 2027 | • Provide ongoing and enhanced support for diversity networks • Ongoing commitment to seek diversity through recruitment strategies • Continued commitments to creating greater diversity in the talent and succession pipeline | • Increased women in senior leadership positions to 42.1% (as defined in the Women in Finance Charter effective 31 March 2025) • Women on Board 40% • Female Chief Executive Officer • Female Finance Director | | | | | | | | | | | | | | Entity specific Employee mental health and wellbeing | • Wellbeing programmes | • No targets set | • Maintain a comprehensive wellbeing strategy | • Continue to build and enhance our wellbeing offering | | | | | | | #### Our employees Our employees represent a diverse and highly skilled workforce, displaying resilience and commitment to our purpose and values and with the ability to embrace change. Our diversity and inclusion framework enables a culture of collaboration and inclusivity that enhances creativity and problem-solving capabilities. The majority of our employees hold professional qualifications and are committed to continuous learning and professional development, actively participating in both internal and external learning programmes that deepen their skill and understanding of broader business practices. Our commitment to our values guides the conduct of all employees and ensures their actions and attitude reflect our values and philosophies. | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 31 March 2025 | | | | | | Methodology | | Employees breakdown by gender | Permanent\* | Temp\*\* | Non- guaranteed hours | Total | % of employees | | • All employees within IBP • For permanent employees, we provide a gender breakdown, categorising individuals by sex (male or female) • For fixed-term contractors and temporary employees, we report a single total number without further demographic breakdowns. | | Male | 1 458 | — | — | 1 458 | 61.4% | | | Female | 899 | — | — | 899 | 37.9% | | | Other | — | — | — | — | —% | | | Not reported | — | 17 | — | 17 | | | | Total employees at end of the period | 2 357 | 17 | — | 2 374 | 99.3% | | | Average number of employees over the period | | | | 2 332 | | | \* Permanent employees are individuals directly employed by Investec Bank plc on a full-time or part-time basis under open-ended employment contracts, with no predetermined end date to their employment. \*\* Temporary employees includes anyone on a temporary or fixed term contract. We do not report on gender for this category. 337 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | --- | --- | | | | | Employees breakdown by country | 31 March 2025 | | Benelux | 16 | | Channel Islands | 127 | | France | 36 | | Germany | 24 | | India | 209 | | Ireland | 48 | | Singapore | 2 | | Switzerland | 45 | | UK | 1 813 | | US | 37 | | Total employees at end of the period | 2 357 | | | | | --- | --- | | | | | Employee turnover | 31 March 2025 | | Total employees that have left during the year | 229 | | Total employee turnover | 9.8% | Engaging with our people Process, our primary method of engagement, is the cultural mechanism we use to have iterative, open and honest dialogue to resolve problems, test decisions, innovate and enable progress. Process requires rigor and discipline and is the driving force behind how work is accomplished, it focuses on embedding psychological safety within teams and entrenching a culture of radical candour and clear feedback with care. Process must be considered within the context of performance – timeous, decisive and with commitment to outcomes. Our employee listening programme, held by our P&O consulting teams, seeks to understand how people experience the organisation, and the extent to which they are aligned to our purpose, values and culture. Additionally, a designated non- executive director represents the views of our workforce in the boardroom, ensuring that employee perspectives are integral to our governance processes. We fully support employees' rights to freedom of association across all businesses and geographies in which we operate. Investec upholds the constitutional rights of our employees to freedom of association, the right to collective bargaining, the protection of employee representatives and the right to be a member of a trade union of their choice. No employees have joined a trade union, making collective bargaining unnecessary. As IBP operates in the financial services sector, our employees are less inclined to join a trade union due to various factors, including the professional work environment and individual contracts. Our employees receive competitive compensation and have individual employment contracts. Additionally, robust labour laws and employee protections provide strong regulatory safeguards, diminishing the perceived necessity for union representation. We recognise the importance of our employee’s views and of employee engagement. We have established internal forums, whistleblowing mechanisms and direct communication channels with leaders to address any employee concerns. Employees who believe they have experienced human rights violations can safely report these incidents through the IBP whistleblowing line, assured that they will not face retaliation. Our whistleblowing policy is available on our [website here](https://www.investec.com/content/dam/united-kingdom/downloads-and-documents/legal/IBP-Whistleblowing-Policy.pdf). Actions and performance We engage with our employees, across all levels, functions, roles, jurisdictions and demographics. Mechanisms we leverage as part of our employee listening strategy include focus groups, performance reviews, learning programmes, site visits, group meetings, one-on-one meetings, town halls, an induction programme, leadership programmes, specific strategy sessions, belonging, inclusion and diversity initiatives, and exit interviews. To enhance the employee value proposition, we measure the effectiveness of employee engagement through strategic qualitative data. This approach improves our understanding of the Investec employee experience and informs targeted interventions. We achieved this by building and operationalising a deliberate employee listening strategy, creating channels for continuous conversation across all Investec jurisdictions, and developing a framework for collecting and analysing qualitative data derived from this strategy. Insights from our employees Workforce engagement activities help us to understand the lived experience of employees at Investec. We value the opinions and experiences of our employees when making decisions or taking actions that may impact Investec or our stakeholders. This involves actively gathering feedback through various channels allowing staff to voice their thoughts and concerns. Through these discussions, we gather insights and, where appropriate, use them to shape our strategy and policies to address a range of impacts, from operational efficiencies to workplace culture and social responsibility initiatives. Governance and oversight The Board of Directors takes ultimate accountability for employee engagement. Refer to page 17 for our Section 172(1) disclosures, fulfilling the statement requirement under the Companies Act 2006. In addition, a designated non-executive director is responsible for overseeing our employee engagement, through various methods, such as face-to-face interactions with our employees, to gather insights and ensure that our employees’ perspectives and concerns are conveyed and taken into account during Board meetings. The non- executive director is tasked with ensuring that the Board and Executive Directors take appropriate actions to address employee concerns and provide feedback to employees regarding how the Board intends to respond to their input. 338 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Employee rights Human rights statement Our human rights statement available in “[The way we do](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/The-Way-We-Do-Business-June-2021.pdf) [business”](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/The-Way-We-Do-Business-June-2021.pdf) [on our website](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/The-Way-We-Do-Business-June-2021.pdf), outlines our philosophy as an organisation to respect the dignity and worth of the individual. We uphold the constitutional rights of our employees at all times, do not practice forced or compulsory labour, and do not employ children. The statement adheres to the Ten Principles of the United Nations Global Compact (UNGC) concerning human rights, labour, environment, and anti-corruption. It ensures that all our operations comply with internationally recognised human rights standards and strictly prohibits any involvement in human rights abuses. In addition, it states that we comply with relevant laws across all jurisdictions and promote the UN principles within our sphere of influence. The statement notes the provision of a minimum living wage, ensuring that all employees globally earn above the statutory minimum. Additionally, it supports international efforts to eliminate human trafficking, slavery, forced and child labour, in accordance with the UK Modern Slavery Act 2015 and relevant International Labour Organisation (ILO) conventions. • Scope of the policy: Our human rights commitment applies to IBP and its subsidiaries and extends to all suppliers, vendors, third parties and their representatives and associated persons, including employees, agents, subsidiaries, affiliates, suppliers, and subcontractors • Accountability: For the Bank, accountability for the implementation of our human rights commitments lies with the Board • Publication status: Our human rights statement was last updated in June 2022 and is accessible to all staff on the intranet. It is also publicly available in the ["The way we do](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/The-Way-We-Do-Business-June-2021.pdf) [business"](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/The-Way-We-Do-Business-June-2021.pdf) on our website. Actions and performance IBP remains committed to the Ten Principles of the United Nations Global Compact, actively supporting and respecting the protection of internationally proclaimed human rights and ensuring that we are not complicit in any human rights abuses. We support the UK Modern Slavery Act 2015 by implementing robust measures to prevent slavery and human trafficking within our operations and supply chain. Our Modern Slavery Act statement is available on our [website here](https://www.investec.com/content/dam/united-kingdom/downloads-and-documents/legal/modern-slavery-act-statement-2024.pdf). Furthermore, our human rights commitments are available to all employees on the intranet. Tracking the effectiveness of our human rights commitments Throughout the year, IBP has maintained a strong commitment to human rights. We are pleased to report that there were no human rights violations within IBP. This success reflects our rigorous policies, ongoing monitoring, and proactive measures to protect the rights and dignity of our employees. Metrics and targets While we have not established specific targets, we aim for no human rights violations relating to our employees; furthermore we do not tolerate workplace bullying, harassment, or discrimination. Metrics on human rights are disclosed below. Our approach focuses on maintaining robust policies and practices that ensure all employees are treated with dignity and respect, rather than aiming for specific numerical benchmarks. | | | | --- | --- | | | | | Severe human rights issues (forced labour, human trafficking or child labour) | 31 March 2025 | | Severe human rights issues (forced labour, human trafficking or child labour) and incidents connected to own workforce (number) | — | | Severe human rights issues (forced labour, human trafficking or child labour) and incidents connected to own workforce that are cases of non-respect of UN Guiding Principles and OECD Guidelines for Multinational Enterprises (number) | — | | Total amount of fines, penalties and compensation for damages relating to severe human rights incidents (forced labour, human trafficking or child labour) (£) | — | Discrimination statement IBP defines discrimination as the unfair or prejudicial treatment of individuals or groups based on characteristics such as gender, race, ethnicity, religion, age, disability, nationality, political opinion, sensitive medical conditions, pregnancy, maternity, civil partnership, and sexual orientation. Discrimination can take various forms, including unequal treatment, harassment, exclusion, or denial of opportunities. Our approach to tracking discrimination incidents focuses exclusively on grievances that lead to disciplinary action, including both ongoing and resolved cases. As an equal opportunity employer, we strive to prevent and eliminate all forms of discrimination in line with our policies, practices, and relevant International Labour Organization (ILO) conventions and legislation. We have established a formal grievance procedure, documented in a written policy, to appropriately address any incidents that may arise. Additionally, we provide several informal channels for employees to discuss their concerns, including access to People & Organisation teams and independent external consultants through our employee wellbeing programme. Furthermore, we have an independent external whistleblowing hotline (Navex) and Web Portal which our employees can use. • Scope of the policy: The discrimination statement applies to the Investec Group, which includes IBP, and relates to our employees in the value chain • Accountability: Implementation lies with the Board. Anyone who feels they are being treated unfairly or is experiencing any form of discrimination, intimidation, or harassment has the right to lodge a grievance (formal or informal) with leadership and/or the Employee Relations department. IBP will investigate the complaint in a sensitive and confidential manner • Publication status: Our discrimination statement was last updated in June 2022 and is accessible to all staff on the intranet. It is also publicly available in the ["The way we do](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/The-Way-We-Do-Business-June-2021.pdf) [business"](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/The-Way-We-Do-Business-June-2021.pdf)on our website. 339 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Actions and performance We continue to use balanced shortlists and interview panels, as well as digital analysis of our job adverts to remove gender- biased language. We provide neurodiversity guidance and information for all employees and leaders. There is sustained take-up of shared parental leave, and we have continued our partnership with an external provider to offer fertility, menopause, pregnancy and early parenting support. Succession planning, with a focus on people development and internal mobility of women and people of colour, remains a priority. Metrics and targets IBP is committed to preventing incidents of discrimination within the Bank through our ongoing business practices. Setting numerical targets for discrimination incidents may not effectively capture the nuances of workplace inclusion. We prioritise creating an environment where all employees feel valued and respected, utilising qualitative feedback and continuous improvement initiatives to address and prevent discrimination. | | | | --- | --- | | | | | Discrimination and complaints | 31 March 2025 | | Complaints/grievances\* (number) | 10 | | Number of complaints where a finding of discrimination (including harassment) was reached | 3 | | Total amount of fines, penalties and compensation for damages as result of incidents of discrimination (including harassment) and complaints/grievances)(£) | — | \* Complaints/grievances are defined as formal grievances filed through channels for people in own workforce to raise concerns, including via whistleblowing mechanisms. 3 of the total 10 complaints resulted in findings of discrimination. #### Employee remuneration Our approach to reward reflects our culture. It relies on open and honest dialogue between people and their leaders, to enable us to recognise and reward the contribution people make and the value they add to the organisation. We reward people based on everything they bring to the role and the team. This includes the scope and complexity of the role as well as the experience and knowledge the individual brings to the role. We determine reward based on strategic financial performance and non-financial contribution. The non-financial elements of the role, while less tangible, are incredibly important and include the contributions that an individual adds over and above the standard expectations of their role. A transparent and formal procedure is used to develop policy and to agree executive and senior leadership remuneration. Our remuneration practices comply with local regulations and reward people meaningfully for their performance and contribution. Investec is supportive of a minimum living wage and ensures that all its employees are paid above the relevant minimum living wage. In line with our philosophy of material ownership, employees across the organisation participate in our staff share awards and have the opportunity to benefit from our long-term growth. Variable remuneration is determined based on overall performance, cultural alignment and risk events, with careful monitoring to ensure regulatory compliance. Additionally, all incentives are subject to a performance adjustment, allowing for the reduction or recovery of remuneration in cases of risk or misconduct. Executive incentives are deferred for up to seven years, ensuring that our incentive structures do not promote irresponsible or short-term behaviour. See more on our remuneration philosophy on page [96](#i447e4d363cd344738300acdd42f0e3a0_250). • Scope of the policy: The remuneration philosophy applies to IBP and relates to our employees in the value chain • Accountability: The IBP Remuneration Committee and the DLC Remuneration Committee are tasked with overseeing the compensation structures for Executive Directors, senior employees, including Material Risk Takers (MRTs), and the broader workforce of the Bank. Ultimately, the Board holds full accountability for all remuneration decisions • Publication status: Our latest remuneration philosophy is available in the [remuneration section](84S0VF8TSMH0T6D4K848-2025-03-31-T01.html#i447e4d363cd344738300acdd42f0e3a0_250-bookmark-a5761ddd3a674d09a48e8fcb7af60e3f) of this annual report. Actions and performance Our pay and bonus gaps are principally driven by a higher proportion of women in junior and mid level roles and a lower, albeit growing proportion, of women in senior leadership, revenue-generating and client-facing roles. We are confident that all our employees are paid fairly and equitably based on their role, skills and experience, and this is central to our reward philosophy.This year there has been an increase in women in both the upper quartiles of pay, improving the balance of women relative to men and resulting in a narrowing in both the mean and median hourly pay gap and bonus pay gap figures. Furthermore, the Bank has a number of share option and long- term share incentive plans that are designed to align the interests of employees with those of shareholder and long-term organisational interests, and to build material share ownership over the long term through share awards. These share option and incentive plans are also used in appropriate circumstances as a mechanism for retaining key talent. Tracking the effectiveness of our remuneration philosophy During the year, the IBP and DLC Remuneration Committees considered the implications of belonging, inclusion and diversity within our remuneration philosophy, policies and frameworks, including addressing equal pay and diversity pay gaps. Furthermore, they considered how our remuneration philosophy, policies and practices support and align with our sustainability initiatives. The Committee also assesses the risk implications of our remuneration policies and reviews regulatory changes related to remuneration to maintain compliance and uphold our commitment to fair and effective compensation practices. Metrics and targets Although we have not set targets, we continue to reduce the gender pay gap and pay all our employees above the minimum living wage. The reduction in our gender pay gap has been positively impacted by a greater proportion of our female population now being in revenue generating functions. We are committed to achieving greater female representation across the organisation, particularly in senior leadership and client- facing roles and are dedicated to reducing the gender pay and bonus differentials over time. 21 The annual total remuneration ratio of the highest paid individual to the median annual total remuneration for all employees. 340 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Compensation metrics (pay gap and total compensation) Hourly and bonus pay gap ![15942919106417]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Hourly pay gap | | | Bonus pay gap | Proportion of male and female receiving a bonus ![15942919106426]() | | | | | | | --- | --- | --- | --- | --- | | | | | | | | | Male | | | Female | • Mean: The mean figure represents the difference between the average of men’s and women’s pay expressed as a percentage of the average male pay • Median: The median represents the percentage difference between the midpoints of men’s and women’s pay. This is expressed as a percentage of the male midpoint • Hourly gender and bonus pay gaps: The hourly and bonus pay gaps are calculated on the average and median across Investec Bank and do not take into consideration factors such as the type of role and level of seniority. • All our employees are eligible to receive a discretionary bonus. Our reward structure is performance-linked and gender-neutral by design. Employees are typically eligible for a bonus after a minimum period of employment. Regarding the gender pay gap calculation we have followed the UK government gender pay gap methodology and excluded individuals who received reduced pay due to a period of leave e.g. unpaid leave, parental leave etc. In addition, 76 employees from an entity that Investec recently acquired majority ownership of are excluded from the pay gap calculations. Annual total remuneration ratio 21 Chief Executive pay ratio The ratios of Chief Executive remuneration to employee remuneration are shown below | | | | --- | --- | | | | | | 2025 | | Median pay ratio | 24.9 | We selected Option A from the UK Companies Act, which calculates the pay and benefits of all employees, using each element of total remuneration, to identify the employee at the 50th percentile. We then calculated the ratio of the IBP Chief Executive pay to the pay of this employee, because we believe it provides the most accurate reflection of the ratio of the IBP Chief Executive pay to the pay of all employees. The calculations reference data for the financial year ending March 2025 and include variable pay awarded for FY25 performance which is paid in June 2025. For 2025 the total pay and benefits for the 50th percentile reported under CSRD is £106,819. Our diversity and inclusion framework aims to create a sense of belonging for all employees, making Investec a place where everyone can be themselves. We actively seek diversity and recognise that a diverse and inclusive workforce is essential to our ability to be an innovative organisation that can adapt to the ever increasingly fast-changing world we live in. We are committed to ensuring our workforce reflects the diversity of our client base and the society in which we operate. We enable belonging and inclusion by: • Developing leaders to enable belonging • Engaging with leaders, teams and consultative forums on how to improve belonging and engagement • Offering learning programmes that encourage dialogue and celebrate the value of inclusion and diversity • Ongoing and enhanced, aligned support for diversity networks across the Group as well as creating awareness of intersectionality across networks • Utilising recruitment strategies that actively seek diversity, engaging with under-represented groups, females and people with disabilities • Providing disabled employees with a supportive and accommodating working environment • Delivering research and thought leadership around diversity, equity, inclusion and belonging. Investec is committed to being an equal opportunity employer. In accordance with our policies and practices, and relevant ILO conventions and legislation, we do not tolerate any form of discrimination based on gender, gender reassignment, race, ethnicity, religion, belief, age, disability, nationality, political opinion, sensitive medical conditions, pregnancy, maternity, civil partnership and sexual orientation. Employees with disabilities are an essential part of a diverse talent pool and every effort is made to facilitate an accessible environment for all. 341 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Board diversity policy The Board diversity and inclusion policy sets out our approach to the diversity of the Board of Directors of IBP, and provides a high-level indication of the Board’s approach to diversity for senior leadership roles. The policy states that the Bank recognises the benefits of a diverse, representative Board, senior leadership and executive management. Diversity of thought is necessary to provide the range of perspectives, insights and challenges to support good decision-making; therefore, consideration is given whereby the collective hold an appropriate balance of skills, knowledge, experience and independence, as well as race, ethnicity, gender identity, culture, age, disability, sexual orientation, geographical provenance, educational, professional and socio-economic backgrounds, and other relevant personal attributes. The policy establishes measurable targets for gender and ethnic diversity within the Board. • Scope of the policy: This policy is applicable to IBP and impacts the Board, senior leadership and executive management in our value chain • Accountability: The IBP Nomination Committee is responsible for monitoring and assessing the Board’s composition and diversity on behalf of the Board, and recommending the appointment of new directors. The Committee also oversees the annual review of the performance of the Board • Publication status: This policy was updated in September 2024 and is reviewed on an annual basis. Actions and performance The IBP Nomination Committee reviews the measurable objectives and targets on an annual basis. Furthermore, they report annually, [in the corporate governance section](#i0d12d50251a44d3fac4d922e76158539_16279) of the Bank’s annual report, on inclusion and diversity progress, including information about the appointment process and progress against these targets. We are committed to achieving greater female representation across the organisation, and particularly in senior leadership and client-facing roles and are dedicated to reducing the gender pay and bonus differentials over time. We foster belonging and inclusion by developing leaders who promote these values and engaging with them, teams, and consultative forums to enhance belonging and engagement. Our learning programmes encourage dialogue and celebrate the importance of inclusion and diversity. We provide ongoing, aligned support for diversity networks across the Group and raise awareness of intersectionality within these networks. Our recruitment strategies actively seek diversity by engaging with underrepresented groups. Tracking the effectiveness of our Board diversity policy To track effectiveness of the Board diversity policy, the Board assigned the responsibility of monitoring Board diversity targets to the IBP Nomination Committee, which reviews the composition of the Board at each meeting. Additionally, we report our progress on diversity and inclusion in the corporate governance section of the Bank’s annual report. This report includes details about new Board appointments and updates on our achievements in meeting diversity goals. Metrics and targets The Board’s current target is to ensure at least 40% female representation on the Board, and for at least one woman to hold the position of the Chair, Chief Executive or Financial Director. Our board gender diversity targets were set with the aim of aligning with industry standards and recommendations wherever possible. This includes aspiring to meet the criteria established by the FTSE Women Leaders Review (formerly the Hampton-Alexander Review) and the Parker Review. These commitments were endorsed by the Board. | | | | | --- | --- | --- | | | | | | Women representation | March 2025 | Target | | Women on the Board | 40.0% | 40.0% | Women in Finance Charter [The Women in Finance Charter](https://assets.publishing.service.gov.uk/media/5a7f44e9ed915d74e62296df/women_in_finance_charter.pdf)(the “Charter”) represents a pledge by HM Treasury and participating firms to collaborate in creating a more balanced and equitable financial services industry. Signatory firms commit to being leaders in their sector by promoting gender balance at all levels. The Charter emphasises that a diverse workforce benefits business performance, enhances customer satisfaction, improves profitability and fosters a positive workplace culture, making firms more appealing to investors. Key commitments of the Charter include: • Supporting the advancement of women into senior roles by focusing on the executive pipeline and mid-tier levels • Acknowledging the diversity within the sector, allowing firms to establish their own targets and implement tailored strategies based on their unique starting points • Requiring firms to publicly report progress against these internal targets to ensure transparency and accountability in driving change. • Scope of the coverage: Senior leadership in the Bank General Management Forum • Accountability: The CEO of IBP is the senior executive responsible and accountable for gender diversity and inclusion • Publication status: The latest disclosure on our commitment to the Charter can be found on our [website here](https://www.investec.com/content/dam/united-kingdom/downloads-and-documents/investor-relations/the-women-in-finance-charter-report-2024.pdf). Actions and performance In September 2018, IBP committed to the Women in Finance Charter, at which time our female representation in senior leadership\* was 19% (as of 31 March 2018). Last year, we set a new target of achieving 35% female representation in senior leadership by 2027, increasing our previous goal by 5%. As of March 2025, we have surpassed this target, reaching 42.1% female representation in senior leadership. We remain steadfast in our commitment to further increase female representation throughout the entire organisation. \*Senior leadership, reported under the Women in Finance Charter, is defined as all those who are members of the Bank General Management Forum. Tracking the effectiveness of our commitment to the Women in Finance Charter IBP monitors the effectiveness of our commitment to the Women in Finance Charter by having the Board review diversity targets on an annual basis. Our progress on diversity and inclusion is published annually in the corporate governance section of the Bank’s annual report. 342 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Metrics and targets By signing the Charter, we pledged to advance gender diversity through several key actions: appointing a senior executive dedicated to gender diversity and inclusion, setting internal gender diversity targets for senior leadership positions, annually publishing progress reports on these targets, and linking the remuneration of senior executives to their success in meeting these gender diversity goals. | | | | | --- | --- | --- | | | | | | Female representation in Senior Leadership\*\*\* | 31 March 2025 | Target | | Female representation in our Bank General Management Forum (Women in Finance Charter) | 42.1% | 35.0% | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | | | Employee gender and age diversity | Executive Directors\* | | | Top managers\* | | | Rest of employees | | | Total | | | | Male | Female | Total | Male | Female | Total | Male | Female | Total | Male | Female | Total | | Total number of employees under the age of 30 | — | — | — | — | — | — | 209 | 135 | 344 | 209 | 135 | 344 | | Total number of employees between the age of 30 and 50 | — | 1 | 1 | 7 | 4 | 11 | 920 | 565 | 1 485 | 927 | 570 | 1 497 | | Total number of employees above the age of 50 | 1 | 1 | 2 | 4 | 2 | 6 | 317 | 191 | 508 | 322 | 194 | 516 | | Total employees at end of the period | 1 | 2 | 3 | 11 | 6 | 17 | 1 446 | 891 | 2 337 | 1 458 | 899 | 2 357 | \* Fani Titi is an Executive Director of IBP however is not reflected in the above as his primary residence is in South Africa and he is reflected in the Investec Limited headcount. \*\* Top managers are defined as those on the Group Executive Team who are based in the UK and members of the Bank General Management Forum. \*\*\* Senior leadership, as reported under the Women in Finance Charter, is defined as members of the Bank General Management Forum. #### Employee mental health and wellbeing Our wellbeing strategy is proactive and preventative, and encompasses physical, mental, emotional and financial health, while also responding to individuals' curative needs. We are enhancing our wellbeing offerings, learning and awareness initiatives to ensure we make it as easy as possible for people to make healthy choices; and that we focus on themes that are a priority for people such as mental and financial health. Our policies, including leave entitlement and flexible working practices, are regularly reviewed and adjusted to take into consideration the needs and wellbeing of our employees, our employment obligations and local market practice. • Scope of the programme: This programme covers the operations on the Bank and our own employees in the value chain • Accountability: For the Bank, our P&O oversees the implementation of this programme, and where required, they will escalate feedback to the Board. This oversight includes regular evaluations of our programmes to assess their impact and effectiveness, as well as soliciting feedback from employees to continuously refine and improve our offerings • Publication status: Our programme is updated on an ad hoc basis and is accessible on our intranet to all our employees. Tracking the effectiveness of our wellbeing programmes IBP measures the effectiveness of its mental health and wellbeing programmes by incorporating evaluations into the culture, climate and conduct (CCC) reports presented to the Board, which include a focus on wellbeing and mental health, underscoring our dedication to these areas. Regular reporting allows IBP to assess the impact of our wellness initiatives, track progress and identify areas for improvement. Actions and performance Our comprehensive wellbeing programmes continue to support the physical, mental, emotional, and financial health of our employees. Employees consistently have access to resources such as private medical insurance, dental plans, counselling services, flexible working arrangements and diversity networks. Metrics and targets We do not have metrics or targets related to employee health and wellbeing. The focus of our mental health and wellbeing programme is to care for our people in an individualised and personal way. The programme supports the objective through our business-as-usual activities rather than through quantitative targets. 343 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Remediating negative impacts and channels for employees to raise concerns IBP has various channels for our employees to raise concerns, this includes raising grievances through our employee relations and compliance teams. Any employee who feels discriminated against or who has been subjected to any form of harassment, has the right to lodge a grievance (formal or informal) with their leader, Business Unit leader, the Head of P&O, People Consultant, Employee Relations consultant or alternatively via the whistleblowing line. In addition, we have an independent external whistleblowing hotline (Navex) and Web Portal which our employees can use. The complaint will be investigated in a sensitive and confidential manner. Where appropriate, an informal grievance process will be facilitated by the People Consultant to address the complaint. If the matter remains unresolved or the conduct is serious or continuous, a formal disciplinary hearing will be scheduled by Employee Relations. If an employee is found guilty of misconduct, they may be dismissed. Investec does not tolerate retaliation against an employee who, in good faith, lodges a grievance regarding discrimination or harassment. Emotional support is provided through the Employee Assistance Programme, which is an external, confidential counselling service provided to employees. We take concerns and whistleblowing very seriously. We strive to protect the anonymity of whistleblowers if they wish. Additionally, we are dedicated to ensuring that our employees can raise concerns with Investec without fear of retaliation, discrimination, disadvantage or dismissal. Our whistleblowing policy is available on our [website here](https://www.investec.com/content/dam/united-kingdom/downloads-and-documents/legal/IBP-Whistleblowing-Policy.pdf). IBP’s whistleblowing methodology encompasses any disclosure of a ‘reportable concern’ related to our operations within the UK. These concerns include breaches of our policies and procedures, behaviours that could harm IBP’s reputation or financial stability, and issues covered under the Companies Act 2008 (Section 159) and the Public Interest Disclosure Act (PIDA). Additionally, employees are encouraged to report any violations of our Conduct or Code of Ethics. It is important to note that whistleblowing incidents occurring outside the UK are not included in this methodology. | | | --- | | | | | #### Our clients We are committed to understanding and meeting the needs of our clients through responsible banking practices that prioritise transparency, ethical conduct and a focus on sustainable outcomes. We actively promote sustainable finance initiatives that empower our clients to transition towards greener practices, thus contributing to a more sustainable economy. Consumers and end-users of IBP include HNW Private Clients within our Private Client Banking activities, as well as corporate, private, intermediary, government, and institutional clients in our Corporate and Investment Banking sectors. In line with the findings of our DMA, this section highlights the IROs for both client segments within our private banking and corporate investment activities. #### Material IROs relating to our clients In our Private Client and Corporate Banking activities, our DMA process identified a financial opportunities related to client engagement and marketing. We recognise the importance of responsible marketing practices that prioritise transparency and respect for client preferences. This approach allows us to engage effectively with clients while ensuring that they are fully informed about products and services, preventing greenwashing and to ensure all our client representations are fair, balanced and understandable. As concerns about data breaches, privacy violations and cyber security threats continue to rise, our commitment to safeguarding client information positions us as a trusted partner in an increasingly digital landscape. These IROs materialise within our own operations. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | ESRS S4: Our clients | | | | | Value chain | | | Affected business model | | FR | Information-related impacts: • Data privacy: Weak data protection can lead to regulatory fines, reputational damage, and loss of client trust, posing a significant financial risk. Entity specific • Cyber security: Cyber threats pose a financial risk through potential data breaches, operational disruption, regulatory penalties, and reputational harm | | | | Downstream | | | • Private Client Banking activities • Corporate and Investment Banking activities | | | | | | | | | | FO | Information-related impacts: • Client engagement and marketing: Providing access to high-quality information can enhance our brand reputation, attract more clients and may drive improved financial performance | | | | | | | | | | | | | | | | | Key | | | | | | | | | | NI | Negative impact | FO | Financial opportunity | | | | | | | PI | Positive impact | FR | Financial risk | | | | | | 344 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Policies related to our clients We are committed to maintaining transparency in our communications by providing access to quality information regarding our products and services. We understand the significance of clear communication in preventing misleading claims, especially concerning sustainability claims. We prioritise data privacy, ensuring that all client information is handled with the utmost care and in accordance with applicable data protection regulations. Furthermore, we are dedicated to combating cyber security threats by implementing robust security measures and continuously enhancing our systems to protect our clients’ sensitive information from potential breaches, thereby ensuring their trust in our services. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Topic and sub-topic | Policies | Targets | Actions | Performance | | | | | | | | Information-related impacts Client engagement and marketing | • IBP Client Communications and Financial Promotions Policy | • No target set | • Ensure that information provided to clients is provided in a comprehensible form • Compliance reviews of client communications to ensure adherence to the policy • Channels are available for clients to report concerns regarding misleading sustainability claims | • The IBP BRCC received two comprehensive reports that evaluated the effectiveness and compliance of our client engagement and marketing strategies • Quarterly reports to the IBP BRCC, covering key conduct matters | | | | | | | | | | | | | | Information-related impacts Data privacy | • IBP Data Protection Policy | • No target set | • Enforcing strict policies to protect sensitive client information • Capture and record any breaches of policy or regulation | • Employee completion rate of protection training. • For the current year all required employees completed this training | | | | | | | | | | | | | | Entity specific Cyber security | • Group Security Framework | • No target set | • Continue to actively seeks potential vulnerabilities within the Bank’s application and infrastructure architecture • Fostering cyber security awareness among our employees | • Employee completion rate of security and cyber security training. • For the current year all required employees completed this training | | | | | | | #### Our clients IBP serves a diverse range of clients, including corporate, institutional, private equity, government and intermediary entities, primarily focusing on small to mid-sized UK corporates. Additionally, IBP caters to HNW private clients, charities and trusts, who are active wealth creators with annual incomes exceeding £300 000 and net asset values above £3 million. These clients rely on IBP for tailored financial services, including lending, investment and advisory solutions that meet their unique needs and support their growth and sustainability objectives. Engaging with our clients Engagement is essential to IBP, as it allows us to understand stakeholder views and respond in a meaningful and impactful way. Throughout the year, we gather feedback through continuous dialogue with stakeholders, including our clients. These insights inform our focus areas, engagement strategies and strategic improvements, ensuring alignment with stakeholder needs and sustainability goals. Additionally, the Board’s oversight of stakeholder engagement ensures that these interactions directly influence principal decisions. We engage with clients through various channels, including providing information about products and services, and issuing financial promotions that encourage investment activity. We customise our interactions to meet the specific needs of our target audiences. Our client engagement and marketing strategies, combined with stringent data privacy and cyber security management, create financial opportunities for the Bank. Effective client engagement and marketing initiatives drive client acquisition and retention, enhancing revenue. Additionally, our commitment to data privacy and cyber security builds trust and confidence among clients, making IBP a reliable partner for safeguarding their sensitive financial information. This trust not only strengthens client loyalty but also attracts new clients, thereby expanding our client base. Moreover, by mitigating the risks of data breaches and ensuring regulatory compliance, IBP avoids potential financial losses and reputational damage, safeguarding our profitability. Our client engagement and marketing strategies cover our entire client base. When creating or reviewing client communications, we assess the likely vulnerability traits of the target audience to ensure the messages are suitable and, when necessary, implement special provisions to accommodate their needs. This involves careful consideration of both the content and the format of our communications to effectively support and engage vulnerable clients. Our vulnerable clients policy considers the guidance from the FCA. The FCA has identified four key drivers of vulnerability, which IBP has incorporated into its approach. These drivers are health conditions that impact daily activities, major life events such as bereavement or relationship breakdown, low resilience to financial or emotional shocks and limited capability in financial matters or digital skills, guide IBP in recognising and addressing client vulnerability. IBP ensures that all business units understand the nature and extent of these vulnerability drivers within their target markets and client base. 345 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Oversight of material client communications is provided by appropriate IBP committees. In compliance with regulations such as Consumer Duty, we test our communications by evaluating factors like the target market, purpose, potential impact, client information needs and vulnerability. Depending on the nature and importance of the communication, we employ testing methods including internal reviews and external focus groups. When uncertainties arise, we consult with Compliance to ensure that our communications are effective and adhere to regulatory standards. Human rights Our position on human rights expresses our strong culture and values, including unselfishly contributing to society, valuing diversity and respecting others. We remain committed to the ten principles of the UNGC with respect to human rights, labour, environment and anti-corruption. Our culture and values demonstrate our belief that as an organisation, we can have a positive impact on the success and wellbeing of local communities, the environment and on overall macro-economic stability. IBP supports and respects the protection of internationally proclaimed human rights standards and are not complicit in any human rights abuses. Furthermore, we support the international agenda to abolish human trafficking, slavery, forced and child labour, and continue to support the UK Modern Slavery Act 2015 (the Act). IBP has integrated a range of regulatory and legislative documents to ensure comprehensive compliance and uphold best practices in customer engagement and protection. Our approach aligns with the Financial Conduct Authority’s (FCA) principles, including Principle 12, which mandates delivering good outcomes for our clients, and Principle 6, which requires us to pay due regard to customer interests and treat them fairly, especially for vulnerable clients, by understanding their needs and ensuring our products and services support their fair treatment. We also adhere to Principle 7 in our communications, Principle 9 in providing advice, and Principle 3 by acting with skill, care, diligence and maintaining appropriate controls. IBP complies with the FCA’s Treating Customers Fairly (TCF) outcomes and follows specific FCA rulebooks such as the Conduct of Business (COBS), Banking Conduct of Business (BCOB), Consumer Credit (CONC) and Mortgage Conduct of Business (MCOB) rules. Additionally, we stay informed through key regulatory publications, including the FCA's Consumer Duty consultation papers, policy statements and guidance, the FCA's vulnerable clients occasional papers and guidance, and the FCA annual Business Plan. Beyond FCA regulations, IBP upholds the General Data Protection Regulation (GDPR) 2018, the Equality Act 2010 and the Mental Capacity Act 2005 (MCA), ensuring robust data protection, equality and support for individuals with impaired decision-making capabilities. Furthermore, IBP adopts industry standards and good practices, even without formal membership, such as the Lending Standard Board’s Standards of Lending Practice, the Contingent Reimbursement Model Code for Authorised Push Payments scams (CRM Code), Fair by Design, the Money Advice Trust’s practical guide on inclusive design, and the Mental Health and Money guidance for supporting customers. These initiatives reinforce our commitment to fostering an inclusive, fair and secure environment for all stakeholders. IBP has established grievance mechanisms and escalation procedures to address any concerns raised by our client or end-users. We offer accessible and confidential reporting channels, including customer complaint procedures and whistleblowing mechanisms, to allow individuals to report potential human rights violations, such as unfair treatment, discrimination or data privacy breaches. IBP conducts thorough investigations into reported issues, ensuring timely and effective resolution. Where human rights violations are identified, IBP takes corrective action, which may include policy revisions, financial compensation, service adjustments or enhanced consumer protections. Our human rights statement is in ["The way we do business”](https://www.investec.com/content/dam/south-africa/welcome-to-investec/corporate-responsibility/The-Way-We-Do-Business-June-2021.pdf), which is available on our website and accessible to all our clients and end-users. Governance and oversight Accountability for human rights impacts lies with the Board, which provides strategic oversight and ensures that human rights considerations are embedded within the Bank’s governance and decision-making processes. The DLC SEC, a Board-appointed committee of the Investec Group, ensures compliance with international standards, such as the UN Guiding Principles on Business and Human Rights, and overseeing the implementation of related policies and due diligence measures across the Investec Group. Oversight is delegated to the DLC Executive Sustainability Committee, which oversees the integration of human rights considerations into the Investec Groups’ broader sustainability strategy. IBP had no human rights incidents relating to the non-respect of the UN Guiding Principles on Business and Human Rights, ILO Declaration on Fundamental Principles and Rights at Work or OECD Guidelines for Multinational Enterprises that involve consumers and/or end-users. #### Client engagement and marketing The IBP Client Communications and Financial Promotions Policy establishes mandatory standards for all client interactions, particularly financial promotions. It ensures that all communications are fair, clear, and not misleading, and tailored to the audience’s needs and sophistication. Financial promotions, broadly defined as invitations to invest, require additional safeguards, including product-specific requirements and special considerations for direct offers. The policy emphasises understanding the target market, using appropriate channels, and following formatting guidelines that include prominent regulatory disclaimers and risk warnings. Additionally, the policy addresses the needs of vulnerable clients and may require communication testing to ensure clarity. It outlines procedures for approving and documenting financial promotions, provides mandatory training for relevant staff, ensures ongoing monitoring, manages non-compliance and mandates regular policy reviews to maintain effectiveness. • Scope of the policy: This policy applies to IBP and all its employees within the value chain, with a focus on the impact on our clients 346 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | • Accountability: Governance around client engagement strategies is embedded within our broader corporate governance framework. The Board and the DLC SEC, provide strategic oversight on client engagement policies, ensuring that our approach is transparent, responsible and aligned with stakeholder expectations. The Board and the IBP BRCC will be informed about material matters concerning client communication. Senior management has responsibility for the oversight of business conducted by IBP, including its communications to its clients send directly or through a third party. Operationally, client engagement strategies are implemented and monitored by relationship managers, client service teams and Compliance Officers, who oversee adherence to our client engagement policy. Additionally, the Bank integrates client engagement governance into its risk management framework, identifying potential risks such as miscommunication, regulatory non-compliance or greenwashing, and implementing mitigation measures • Publication status: This internal policy was approved in May 2024, and available to all employees on our intranet. Actions and performance Throughout the year, IBP focused on our client engagement and marketing practices. The IBP BRCC received two comprehensive reports that evaluated the effectiveness and compliance of our client engagement and marketing strategies, ensuring they met our ethical standards and regulatory requirements. Additionally, the compliance team provided quarterly updates to the IBP BRCC, covering key conduct matters such as client complaints related to marketing practices, breaches of conduct policies in client interactions, regulatory interactions concerning our marketing efforts and ongoing staff training programmes focused on ethical client engagement and compliant marketing strategies. These regular updates enabled IBP to promptly identify and address any material matters in client engagement and marketing, mitigating conduct risks and maintaining high standards of integrity and compliance. Metrics and targets Although we have not set specific metrics or targets, IBP is committed to ensuring that all sustainability-related claims are fair, clear and not misleading. This practice is integrated into our business-as-usual activities rather than being embedded within quantitative targets. Currently, establishing specific targets for client engagement and marketing is challenging due to the qualitative and dynamic nature of these activities. Client engagement adapts based on market conditions, client needs, regulatory changes and product strategies, making it difficult to define fixed or measurable sustainability-related targets that remain relevant and achievable over time. Our focus is on maintaining high standards of transparency and integrity in all our communications and services to ensure client satisfaction and uphold our reputation for ethical practices. To assess the effectiveness of our client engagement, we encourage client feedback and where required grievance mechanisms are available that allow clients to report concerns or suggest improvements. Additionally, IBP conducts regular reviews of client complaints, compliance audits, and industry benchmarking to assess the mitigation of IROs and identify areas for enhancement. Insights from these assessments are reported to senior management and the DLC SEC, ensuring continuous improvement in our engagement approach. #### Data privacy The Data Protection Policy outlines the measures we take to safeguard personal data for all our clients. We are committed to implementing appropriate physical, technical and organisational measures to protect personal data from accidental or unlawful destruction, loss, alteration, unauthorised disclosure or access. Our security protocols are aligned with the standards set forth in our suite of Information Security Policies. Employees responsible for processing personal data receive appropriate training and guidance on data security. However, we expect all employees to be familiar with the principles outlined in the policy and other relevant information security policies of the Bank. Furthermore, all employees have a responsibility to promptly report any personal data breaches or suspected breaches to their line manager as soon as they become aware of such incidents. In the event of a data security breach, the Bank will notify the affected client or end-user without undue delay and within 72 hours of becoming aware of the breach. Additionally, the policy defines strict requirements for client confidentiality, enforcing robust measures to protect sensitive financial information. It ensures that client data is only shared with third parties when there is a legal justification and adequate safeguards are in place. • Scope of the policy: The Policy, applies to all processing of personal data acquired from employees, agents, consultants, contractors, vendors, service providers, clients, investors and others. This Policy must be implemented and followed by all Relevant Persons. For the purpose of this policy “Relevant Persons” are defined as: • All IBP employees (whether permanent or temporary employees) • Any other persons contracted to work on IBP premises and/or in relation to IBP business (including in particular, any persons engaged by IBP as a consultant, worker or agent) • Clients of IBP or visitors to IBP premises. • Accountability: Compliance with our Data Privacy and Protection Policies is monitored by the Data Protection Office (DPO) in collaboration with relevant risk managers. This oversight ensures that any significant non-compliance issues are escalated to the appropriate business unit management and Operational Risk teams for review and resolution. Material issues identified through this process are escalated to the R&CF, IBP BRCC and/or the Audit Committee for further examination and action. Governance surrounding data privacy and protection at IBP is designed to promote a culture of accountability and transparency. Regular audits and assessments are conducted to evaluate compliance with the policy, and findings are documented to track progress and identify areas for improvement. The DPO plays a crucial role in providing guidance and support to all business units, ensuring that employees are well informed about their responsibilities regarding data protection. For the Bank, accountability for implementation lies with the Board • Publication status: The data protection policy is an internal policy approved in September 2023 and available to all employees on our intranet. 347 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Actions and performance Throughout the year, IBP continued to strengthen data privacy and security. The DLC ITRGC played a pivotal role in overseeing security measures. Three members of the Board also served on the DLC ITRGC, ensuring cohesive oversight and integration of security practices across committees. All security-related matters addressed by the DLC ITRGC were thoroughly documented and included in the IBP BRCC meeting papers. This inclusion ensured that senior leadership remained informed about data privacy issues and could provide appropriate guidance and oversight. Additionally, the Digital & Technology department provided the IBP BRCC with updates five times throughout the year. These updates encompassed the latest developments in data privacy, ongoing security initiatives, compliance status and any emerging threats or vulnerabilities. Metrics and targets Although we have not set specific targets, we are dedicated to preventing data breaches by requiring all employees to complete mandatory data protection and cyber security training. Setting a numerical target for data breaches could imply a tolerance for such incidents, which is inconsistent with our zero-tolerance approach to data privacy and protection. Instead, we focus on maintaining robust data governance frameworks, continuous staff training, and strong cyber security measures to proactively prevent breaches. Mitigation of IROs is assessed through incident tracking, internal audits and compliance assessments, with a clear emphasis on prevention, rapid response and ongoing improvement in line with regulatory expectations and client trust. Data privacy training We place strong emphasis on building a culture of accountability and awareness around data privacy, with the expectation that all employees complete mandatory training. Employee completion rate of data protection training is the specific metric used to monitor the related IROs. For the current year all required employees completed this training within an 86 day window. Where an employee has not completed the required training within this window, these are non-compliant and reflected in a breaches register. While our goal is full participation, we understand that occasional delays can occur due to unforeseen circumstances such as workload pressures, personal matters, or health issues. In such cases, reasonable flexibility is provided to ensure employees can complete the training without compromising their engagement or understanding. This balanced approach supports both compliance and individual wellbeing. This training applies specifically to Investec Bank plc, as subsidiaries may follow separate regulatory training requirements. Furthermore, while our mandatory training programs primarily focus on positions directly related to operational and compliance functions, support staff roles, such as security personnel and administrative assistants, are not included in these requirements, as their responsibilities do not align with the specific training objectives outlined in our sustainability strategy. | | | | | --- | --- | --- | | | | | | Module name | Overview of module | Frequency of training | | Data protection | Provides staff with an overview on what personal data is, the key principles of the General Data Protection Regulation (GDPR) and what is expected of them | • 18 months | #### Cyber security The Investec Group Security Framework Policy details the Investec Group’s (including IBP’s) comprehensive strategy to uphold trust by mitigating risks related to service disruptions, financial losses, and data breaches from both internal and external threats. It provides a strategic overview of the Investec Group’s security measures, outlines frameworks for managing cyber and information security risks, specifies key control areas and describes methods for enhancing security capabilities. • Scope of the policy: This policy applies to the entire Investec Group, including IBP, and focuses on safeguarding our operations and protecting our clients throughout the value chain • Accountability: Cyber risk remains a top priority for the Board. We provide periodic updates to keep the Board and senior management informed of industry developments and how we remain resilient by adapting and enhancing our strategies. We are committed to safeguarding client and employee data through robust cyber security measures and strict compliance with data protection laws. We adhere to the UK Data Protection Act and the EU GDPR, conducting regular data protection impact assessments to ensure our practices meet regulatory standards. Our cyber security measures include implementation of advanced systems and incident response protocols, along with employee training on data privacy and cyber security threats. The Board oversees the technology and cyber security strategies. Furthermore, governance structures are in place to review how technology and security risks are managed with relevant updates reported to the Board. Six of the nine directors have medium to high digital and technology expertise. Refer to page [63](#i447e4d363cd344738300acdd42f0e3a0_3848290700527) for directors biographies. For the Bank, accountability for the implementation lies with the Board • Publication status: The Investec Group (including IBP) policy framework last updated in October 2024 and is available to all employees. Actions and performance We have adopted a threat-based risk management approach, focusing on our most likely and sophisticated threat actors, both internal and external, and tailoring our strategies to defend against them. Threat simulations are a core pillar of our strategy, with external security experts conducting targeted attack simulations to stress test our processes and evaluate the effectiveness of our security controls. Insights gained from these simulations are instrumental in strengthening our cyber defences. Our cyber security team actively seeks potential vulnerabilities within the Bank’s application and infrastructure architecture. These experts use constant research to stay at the leading edge of changes in potential threats to the landscape of our technology and processes. The team plays an important role in product development, making sure that all applications are secure by design. They also raise new threats they identify with the information security teams, to put preventative measures in place and minimise potential cyber incidents. 348 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | We recognise the importance of comprehensive information and cyber security training in mitigating risks associated with the ever-evolving cyber threat landscape. By fostering security awareness based on current trends and threats, we actively shape the security culture within our organisation. To maintain a state of vigilance among our staff, we prioritise ongoing security training activities. These activities are provided to all staff, both existing and new, ensuring that they are equipped to identify and respond to potential threats. We use varied training methods to drive the success of our training programme including: • Risk-based security training: To address specific security risks, we employ a risk-based approach to security training. This includes gamified security training for high-risk departments and annual security training for all staff. Targeted training for specific departments or roles is conducted as needed to address emerging cyber threats • Security awareness topics and engaging content: To ensure the effectiveness of our security awareness campaigns, we cover a range of topics that are relevant and engaging. These topics include data security, password management, security practices around using artificial intelligence (AI) tools, including threats such as deepfakes, and awareness of new cyber threats. We also use innovative methods such as AI-generated podcasts to deliver engaging and informative content to our staff. Furthermore, periodic directors’ training takes place to educate and enhance awareness around digital, technology and cyber security matters. This is supported by periodic FinTech newsletters, which keep the executive team and senior management informed. Measuring effectiveness of managing cyber security risk To ensure the effectiveness of our security training programme, we regularly conduct industry benchmarking reviews. These reviews help us gauge our performance by comparing our phish-prone percentage, click rate and data entry against industry benchmarks. By consistently staying below these benchmarks, we demonstrate our commitment to maintaining a positive security culture and reducing staff susceptibility to cyber attacks. Publishing our external cyber security ratings allows us to differentiate our business, and quantitatively measure our cyber and information security maturity providing independent assurance to our Board and Executives. Additionally, our security experts actively contribute to business initiatives and have visibility through security articles and presentations that inform and reassure clients, and keeping us on the pulse of the security landscape. Metrics and targets Employee completion rate of cyber security training is the specific metric used to monitor the related IROs. For the current year all required employees completed this training within an 86 day window. Where an employee has not completed the required training within this window, these are non-compliant and reflected in a breaches register. Although we have not set targets, we expect all our employees to complete mandatory cyber security awareness training. We do not set quantitative targets for cyber security incidents, as our strategic objective is to prevent all incidents, reflecting a zero-tolerance approach to cyber threats. Setting a numerical target could inadvertently suggest an acceptable threshold for breaches, which does not align with our risk appetite or commitment to protecting client data, operational integrity and business continuity. Cyber security risk is highly dynamic, driven by evolving threat landscapes and external factors beyond the Bank’s control. As such, our focus is on maintaining a strong cyber resilience posture through continuous investment in technology, real-time threat monitoring, regular penetration testing, staff awareness training, and adherence to international security standards. Our performance in this area is assessed for mitigation of IROs through qualitative assessments, incident response capabilities, and compliance with regulatory and industry benchmarks. Cyber security training We prioritise a strong culture of cyber awareness and resilience, underpinned by the expectation that all employees complete mandatory cyber security training. While we strive for full completion, we acknowledge that delays may arise due to factors such as operational demands, personal commitments, or health-related challenges. In these instances, we offer appropriate flexibility to allow staff to complete the training effectively and without undue pressure. This approach ensures our people are well-informed while recognising individual circumstances. This requirement applies specifically to Investec Bank plc; subsidiaries may follow separate regulatory training requirements. Furthermore, while our mandatory training programs primarily focus on positions directly related to operational and compliance functions, support staff roles, such as security personnel and administrative assistants, are not included in these requirements, as their responsibilities do not align with the specific training objectives outlined in our sustainability strategy. | | | | | --- | --- | --- | | | | | | Module name | Overview of module | Frequency of training | | Cyber security and fraud awareness | This module on information and cyber security is designed to provide staff with the necessary knowledge and skills to protect themselves and Investec from various cyber threats | 18 months | 349 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | --- | | | | | #### Business conduct #### Business conduct governance We are committed to upholding high standards of honesty, transparency and ethical behaviour and do not tolerate bribery or corruption in any form. We comply with all relevant anti- bribery laws, including the UK Bribery Act, the UK Financial Conduct Authority (FCA), the Prudential Regulation Authority (PRA) rules, and other relevant regulations that may be applicable from time to time depending on where Investec has operations or conducts business. Ultimately, the Board oversees the Bank’s initiatives to ensure ethical behaviour and business practices. Refer to page [297](#i118dad0ceb4f4298bf840dcaa1b17113_631679) for the responsibilities of the Board and Executive Committees. #### Our approach to business conduct and the link to our strategy Our commitment to sound corporate governance is deeply ingrained in our values, culture, processes and organisational structure. We firmly believe in upholding integrity at all levels, with our directors and employees consistently demonstrating uncompromising moral strength, fostering and maintaining trust among our stakeholders. We require our directors and employees to conduct themselves ethically and with integrity, as well as to consistently and uncompromisingly display moral strength and behaviour that promotes trust. Sound corporate governance is implicit in our values, culture, processes, functions, organisational structure, and the structures designed to formalise oversight of all businesses and processes. We expect employees to adopt a responsible, open and trustworthy approach to managing their behaviour within the organisation. Employees are encouraged to deal with issues openly and honestly by sharing information directly and at any level that they feel is appropriate. IBP maintains high standards across all domains of business conduct, including areas identified as material sustainability matters. Our commitment to these high standards is integrated in our ongoing activities rather than through quantitative targets. These IROs materialise within our own operations. #### Material IROs relating to business conduct | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | ESRS G1: Business conduct | | | | Value chain | Affected business model | | PI | Entity specific • Regulatory and legal compliance: Safeguard human rights, promote environmental stewardship and ensure fair, responsible business practices | | | • Own operations • Downstream | Own operations | | | | | | | | | FR | Business conduct • Corporate culture: Risk of high employee turnover, reduced productivity and reputational damage • Protection of whistleblowers: Risk of undetected misconduct, regulatory penalties, litigation cost and reputational damage • Corruption and bribery: Risk of fines, legal action which may impact revenue, reputation and investor confidence | | | • Upstream • Own operations • Downstream | Own operations | | | | | | | | | FO | Entity specific • Transparency and disclosure: Clear and credible sustainability disclosures enhance investor confidence, strengthen stakeholder trust, and improve access to responsible capital and funding opportunities • Regulatory and legal compliance: Strong compliance practices can enhance reputation, support continued market access, attract responsible investment, and reduce long-term costs by minimising regulatory risk and operational disruption | | | • Own operations • Downstream | Own operations | | | | | | | | | Key | | | | | | | NI | Negative impact | FO | Financial opportunity | | | | PI | Positive impact | FR | Financial risk | | | 350 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Policies related to business conduct We have a number of policies in place to ensure ethical business conduct and safeguard us against financial losses, reputational damage or harm to our corporate culture. The following table shows the identified IROs and the policies, actions and performance associated with each. | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Topic and sub- topic | Policies | Targets | Actions | Performance | | | | | | | | Business conduct Corporate culture | • IBP Conduct Risk Policy | • No targets have been set | • Annual review of business conduct policies • Annual approval of the IBP conduct risk policy by the Board • Regular training for all employees on business conduct • Breaches in conduct are recorded and reported to management and relevant committees and considered in the annual remuneration process | • Employee completion rate of mandatory business conduct training • For the current year all required employees completed this training | | | | | | | | | | | | | | Business conduct Protection of whistleblowers | • [IBP](https://www.investec.com/content/dam/united-kingdom/downloads-and-documents/legal/IBP-Whistleblowing-Policy.pdf) [Whistleblowing](https://www.investec.com/content/dam/united-kingdom/downloads-and-documents/legal/IBP-Whistleblowing-Policy.pdf) [Policy](https://www.investec.com/content/dam/united-kingdom/downloads-and-documents/legal/IBP-Whistleblowing-Policy.pdf) | • No targets have been set | • Annual review of whistleblowing policy and approved by the Board • Continued monitoring of all whistleblowing channels for any whistleblowing disclosures | • Employee completion rate of mandatory whistleblowing training • For the current year all required employees completed this training | | | | | | | | | | | | | | Business conduct Corruption and bribery | • IBP Anti-bribery and Corruption Policy (ABC Policy) | • No targets have been set | • Annual review of ABC Policy in accordance with regulations and approved by the Board | • Employee completion rate of mandatory anti-bribery and corruption training • For the current year all required employees completed this training | | | | | | | | | | | | | | Entity specific Legal and regulatory compliance | • IBP Compliance and Conduct Manual | • No targets have been set | • Ongoing identification and application of rules and regulatory requirements • Compliance monitoring | • Employee completion rate of UK regulations and compliance responsibilities training • For the current year all required employees completed this training | | | | | | | | | | | | | | Entity specific Transparency and disclosure | • No policy | • No targets have been set | • Perform gap analysis of current and emerging regulatory disclosures as regulations are released | • Comply with current mandatory disclosure requirements | | | | | | | #### Corporate culture Sound corporate governance is implicit in Investec’s values, culture, processes, functions and organisational structure. Our corporate culture is rooted in our core values. These values are embedded in our operations and decision-making, ensuring that all employees uphold the highest ethical standards. IBP’s conduct risk policy defines IBP’s conduct risk appetite and sets out our approach to identifying and assessing applicable conduct risks, mitigating the impact of conduct risks, and monitoring and reporting conduct risks. The policy also outlines the obligations of all employees regarding the identification, assessment, management, monitoring and reporting of conduct risk. All IBP employees are required to comply with the policy. The policy, along with other associated policies governing conduct of business, enables IBP to maintain integrity in the market, deliver fair client outcomes, and ensure that IBP’s affairs are organised with appropriate levels of oversight and control to mitigate business risk. • Scope of the policy: This policy applies to IBP and its regulated subsidiaries. Each regulated subsidiary must develop its own conduct risk policies that align with the overarching standards established in the IBP Conduct Risk Policy. These policies should take into account the subsidiary’s size, the nature of its business and applicable local regulations. This policy applies to our employees within the value chain • Accountability: The Board is accountable for the establishment and effective implementation of business conduct policies. All IBP employees attest, upon joining and annually thereafter, that they have read and complied with the IBP compliance and conduct manual (the Manual) and other policies applicable to their role and business areas, which include the IBP conduct risk policy. The Manual provides a high-level overview of key compliance, conduct and regulatory responsibilities, and directs our employees to 351 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | other policies that they must comply with. The Manual was last updated in April 2025 • Publication status: This policy was most recently approved at the Board in February 2025. We are dedicated to upholding high ethical standards through a series of ongoing actions. We continuously review our business conduct policies to ensure they remain effective and up to date. All employees engage in regular training programmes on business conduct to reinforce these standards. Upon joining, every employee and director attests to their compliance with our policies and has ongoing access to them throughout their tenure. We diligently record any breaches of business conduct policies or instances of employee misconduct and promptly report material cases to management and relevant committees. These actions ensure that our employees act with integrity, consistently demonstrating moral strength and behaviours that build trust. Actions and performance As part of its commitment to ethical conduct and sound governance, Investec Bank plc undertakes an annual review of its business conduct policies, ensuring they remain aligned with evolving regulatory standards and internal expectations. To embed a strong culture of integrity across the organisation, we aim that all employees undergo regular training on business conduct, which is designed to reinforce awareness of expected behaviours and regulatory responsibilities. Furthermore, any breaches of conduct are systematically recorded and escalated to management and the relevant governance committees. These incidents are also factored into the annual remuneration process, ensuring accountability and alignment between ethical conduct and performance-related rewards. Measuring effectiveness of our conduct risk policy All reported conduct breaches are assessed and recorded. Should a breach be assessed as 'material' and thus warrant internal or external reporting, it will be escalated through the IBP R&CF, the IBP BRCC, and subsequently reported to the Board. Material and repeat conduct breaches committed by employees are reported to the IBP Reward Committee and taken into consideration when determining an individual’s remuneration. They may also result in a disciplinary sanction. We focus strongly on preventing and mitigating conduct risks and where required take appropriate legal and/or disciplinary action to address conduct issues. Employee completion rate of business conduct training is the specific metric used to monitor the related IROs. For the current year all required employees completed this training. This training covered essential regulatory and legal requirements related to conducting financial services activities. Business conduct training We are committed to fostering a culture of continuous learning and development, with the aim of achieving 100% completion of compliance-related training for all employees. However, we recognise that there may be circumstances that prevent some employees from completing the training within the designated time frame. These circumstances can include personal challenges, unforeseen work commitments or health-related issues. To support our employees and ensure they have the opportunity to fully engage with the training content, we may grant extensions when necessary. This approach not only reflects our understanding of individual situations but also reinforces our commitment to inclusivity and employee wellbeing. It is important to note that this approach to training completion applies specifically to Investec Bank plc and not its subsidiaries, which have their own regulatory requirements that they track independently. Furthermore, while our mandatory training programs primarily focus on positions directly related to operational and compliance functions, support staff roles, such as security personnel and administrative assistants, are not included in these requirements, as their responsibilities do not align with the specific training objectives outlined in our sustainability strategy. For the current year all required employees completed this training within an 86 day window. Where an employee has not completed the required training within this window, these are non-compliant and reflected in a breaches register. | | | | | --- | --- | --- | | | | | | Module name | Overview of module | Frequency of training | | Conduct rules and standards | Provides an overview of the Conduct Rules established by the Financial Conduct Authority (FCA) and the Prudential Regulatory Authority (PRA) that all employees at IBP are required to follow. Furthermore, it addresses the fitness and propriety of employees, as well as the management of conduct risks faced by the organisation | • 18 months for senior managers and non- executive directors • 12 months for other employees | #### Protection of whistleblowers We are committed to fostering a culture of integrity and transparency, ensuring that all employees feel empowered to report concerns regarding unlawful behaviour. Our mechanisms for identifying, reporting, and investigating such concerns are designed to help employees recognise significant issues and take immediate, appropriate action to address and resolve them effectively. Whistleblowing reports are investigated promptly, independently and objectively, and in accordance with internal policies and procedures which are underpinned by the current regulation and legislation. The Bank is subject to legal protection of whistleblowers. The Bank complies with key UK whistleblower protection laws and regulations, including the Public Interest Disclosure Act 1998 and section 43A of the Employment Rights Act 1996, which safeguards whistleblowers from unfair dismissal or detriment when reporting misconduct in the public interest. 352 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | The IBP whistleblowing policy establishes clear procedures for employees to report suspected misconduct, illegal activities or inappropriate behaviour within the Bank. The policy promotes open dialogue while providing formal channels for raising concerns both internally, with contacts such as their line manager or business head, the Head of Compliance, the Head of P&O and a dedicated Whistleblowers’ Champion, and externally through an independent external whistleblowing hotline (Navex) and Web Portal, or directly to regulatory bodies like the FCA and PRA. Concerns may be raised either orally or in writing and can be made anonymously. A crucial aspect of the policy is the protection of whistleblowers against victimisation, offering options for confidentiality and anonymity. It clearly defines what constitutes a reportable concern, including policy breaches, reputational harm, protected disclosures under the Public Interest Disclosure Act (PIDA) and non-financial misconduct. The policy outlines the principles and standards for safeguarding whistleblowers and ensures the effective handling of all reports, treating them with strict confidentiality. External stakeholders, including clients and partners, can also raise their concerns. Additionally, feedback mechanisms are in place to enhance interactions with our clients and other stakeholders based on their experiences and complaints. The management of client complaints is covered in the IBP complaints policy and available on our website [here](https://www.investec.com/en_gb/legal/complaints.html). • Scope of the policy: IBP’s whistleblowing policy applies to IBP employees based in the UK, as well as to our external clients and partners within the value chain. Additionally, all IBP subsidiaries implement similar policies to ensure consistent standards and practices across the entire Group • Accountability: The Board is responsible for overseeing significant matters that may compromise our business conduct and receives regular reports on our whistleblowing processes • Publication status: [This external policy](https://www.investec.com/content/dam/united-kingdom/downloads-and-documents/legal/IBP-Whistleblowing-Policy.pdf) was last updated in February 2025. Furthermore, information about how and with whom to share concerns is readily available in our whistleblowing policy on the intranet for all our employees. Actions and performance If a conduct breach is reported via IBP’s whistleblowing channels, the initial assessment of the allegation will be conducted by the Head of Compliance, unless they are conflicted. In cases where a breach is substantiated, the incident will be escalated as outlined above. Furthermore, material and repeated conduct breaches will also be reported to the Reward Committee and will be taken into account when determining an individual’s remuneration. We monitor all whistleblowing channels to ensure that any disclosures are promptly addressed and handled appropriately. Additionally, we are committed to providing regular training for all employees on whistleblowing procedures, ensuring that everyone is equipped with the knowledge and skills necessary to identify and report any concerns effectively. These actions ensure that we uphold the protection of whistleblowers and facilitate the appropriate escalation of whistleblowing reports. Measuring effectiveness of our whistleblowing policy The effectiveness of our whistleblowing policy is assessed for mitigation of IROs through a structured approach that includes regular reviews and assessments of reported concerns. All whistleblowing reports (measured in number of whistleblowing reports) are logged and tracked to ensure that each case is addressed promptly and thoroughly. Governance and oversight Our performance in relation to whistleblowing includes an annual review of the whistleblowing policy, which is approved by the Board. All whistleblowing cases are subject to oversight by the Non-Executive Whistleblowing Champion, who is a member of the Board, ensuring accountability and transparency in the handling of disclosures. Additionally, we require all staff to periodically complete mandatory whistleblowing training, reinforcing the importance of awareness and understanding of the procedures. Legal requirements relating to the protection of whistleblowers As a UK-listed financial institution, IBP is subject to several laws and regulations regarding the protection of whistleblowers, ensuring that individuals who report misconduct are safeguarded from retaliation. Key applicable laws include: • The Public Interest Disclosure Act 1998 (PIDA): This is the primary UK whistleblower protection law, which protects workers from unfair treatment or dismissal when they report concerns in the public interest, such as fraud, financial misconduct, or regulatory breaches • The Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) rules: As a regulated financial institution, IBP must comply with the FCA’s and PRA’s whistleblowing rules (SYSC 18 in the FCA Handbook) • The Employment Rights Act 1996 (as amended by PIDA): This act provides additional protections, ensuring whistleblowers have the right to seek legal remedies if they face dismissal or detriment for making a protected disclosure • The UK Corporate Governance Code: Requires listed companies to establish formal whistleblowing mechanisms, ensuring that employees can raise concerns confidentially and without fear of retribution. We ensure the protection of all whistleblowers in accordance with relevant laws and regulations. Additionally, all directors and employees are required to complete mandatory whistleblowing training. Whistleblowing training Employee completion rate of whistleblowing training is the specific metric used to monitor the related IROs. For the current year all required employees completed this training within an 86 day window. Where an employee has not completed the required training within this window, these are non-compliant and reflected in a breaches register. Refer to page [351](#i408f7569c095494f86a844396a50e338_359822) for more information. Furthermore, while our mandatory training programs primarily focus on positions directly related to operational and compliance functions, support staff roles, such as security personnel and administrative assistants, are not included in these requirements, as their responsibilities do not align with the specific training objectives outlined in our sustainability strategy. | | | | | --- | --- | --- | | | | | | Module name | Overview of module | Frequency of training | | Whistleblowing | Outlines the definition of whistleblowing at Investec, detailing when and how to report concerns, as well as the protections afforded to individuals who engage in whistleblowing | 12 months | 353 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Corruption and bribery IBP recognises that bribery is a criminal offence, and it is illegal for IBP, its employees, agents or associated persons to give, offer, accept, request or authorise a bribe, including facilitation payments. IBP may face criminal charges if an associated person commits bribery and it is proven that IBP lacked adequate procedures to prevent such actions. Functions most at risk for corruption and bribery We recognise that certain functions within our business activities carry a heightened risk of bribery and corruption, particularly those involving client onboarding, third-party relationships, procurement and cross-border transactions. Given our engagement in Corporate and Investment Banking, interactions with HNW individuals, politically exposed persons and international entities, this may present potential exposure to unethical practices. Additionally, procurement and supplier management pose risks related to conflicts of interest and improper inducements. To mitigate these risks, IBP has implemented robust ABC Policies, stringent due diligence procedures, and ongoing compliance training for our employees. All employees in the functions at risk for bribery and corruption are required to complete mandatory anti-bribery and corruption training. Monitoring and reporting mechanisms ensure adherence to regulatory requirements, while independent internal audits and whistleblowing channels reinforce our commitment to ethical business conduct. Anti-bribery and Corruption Policy Our ABC Policy outlines the principles and minimum standards we adhere to, ensuring compliance with relevant legislation, including the UK Bribery Act 2010, local laws and regulatory requirements applicable in the jurisdictions where we operate. This policy governs several key components, including gifts, hospitality and conflicts of interest. Furthermore, we conduct thorough due diligence on third parties, clients and business partners. All employees are required to undergo mandatory training to ensure awareness and compliance. • Scope of the policy: This policy applies to IBP and all business activities in the value chain • Accountability: The Board is responsible for overall compliance ABC regulations and for managing ABC risk exposure • Publication status: This internal policy was updated in October 2024. IBP upholds a zero-tolerance policy for all forms of bribery and corruption, whether actively offering or passively accepting bribes, ensuring strict compliance with the UK Bribery Act and other relevant regulations. We are committed to actively preventing and rejecting any corrupt, fraudulent, collusive or improper practices. Although we have not set specific targets, our dedication to zero tolerance remains firm. To support this commitment, all employees and directors are required to complete mandatory ABC training. Actions and performance IBP had no incidents of bribery and corruption and no fines for violation of anti-bribery and corruption laws relating to our employees, third-party intermediaries, suppliers or clients of investee companies. To enforce and assess these policies, we carry out regular risk assessments to identify and mitigate potential corruption risks, supported by independent internal audits and external compliance reviews. Additionally, we have established reporting mechanisms that allow employees to escalate any concerns related to potential corruption. The Bank operates a ‘three lines of defence’ model, with the front office staff seen as the first line of defence, risk management and regulatory compliance being the second line of defence, and internal audit acting as the third line of defence. The responsibilities of each line of defence include, but are not limited to the following: • First line: Ownership of financial crime risk and the day-to- day running of the business, e.g. risk identification and management including design, operation and testing of the controls required to comply with IBP’s risk appetite and policies • Second line: Competent risk management, e.g. establishing risk management standards and providing independent challenge and assurance of activities, processes and controls carried out by the first line • Third line: Oversight of first and second line risk management and performing independent audits of financial crime processes to provide assurance over the adequacy of the financial crime framework and processes adopted. The Board ensures that IBP fosters an anti-bribery and culture and maintains a control framework aligned with its core values, establishing reporting mechanisms for necessary escalations. The Board is committed to adhering to relevant regulatory requirements and guidance to prevent the Bank from being used to facilitate financial crime. Senior management is responsible for implementing the ABC Policy, ensuring employee awareness and compliance, while divisional heads establish systems and approve high-risk relationships. The Money Laundering Reporting Officer (MLRO) oversees the ABC programme, maintains the policy and ensures its annual review. The financial crime team ensures the effectiveness of ABC controls, assesses risks, monitors adherence and advises on compliance for new initiatives. All employees must comply with the policy, complete mandatory ABC training and report any bribery or corruption suspicions to the MLRO, maintaining accurate records. Non-compliance may result in severe consequences, with all breaches reported to the MLRO and recorded in the Compliance-maintained Breaches Register. These actions enable the Bank to enforce strict ABC standards. 354 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Procedures in place to prevent and detect bribery and corruption IBP and its subsidiaries are dedicated to maintaining high standards of integrity and ethical behaviour. We have established comprehensive policies and procedures to effectively manage financial crime risks, specifically focusing on the prevention and detection of bribery and corruption. • Reporting on anti-bribery and corruption: The MLRO is required to provide assurance to the Board and other senior management forums that IBP has effective procedures, systems, and controls to manage ABC risk in line with the ABC Policy. As a result, the MLRO provides management information to both the IBP R&CF and IBP BRCC and submits an MLRO report to the Board at least once every year. The management report covers topics such as: • Any significant changes to ABC risk • Any significant changes to relevant systems and controls • Any significant legal or regulatory changes that have had or could have an impact on IBP’s systems and controls or compliance with relevant legal and regulatory obligations • An outline of the activities undertaken to assess the adequacy and effectiveness of relevant systems and controls • Areas where the relevant systems and controls are not satisfactory and proposals for making the necessary improvements • The progress of any significant remedial actions. Our ABC Policy is available on the intranet for all employees. Furthermore, all employees receive ABC training at regular intervals, to ensure that they are aware of and understand their legal and regulatory responsibilities, their personal obligations and their roles in ABC risk management. This training occurs at the outset of employment with the Bank and on an ongoing basis. Training that is provided to employees is appropriate to their role and responsibilities. Where necessary, specialised training is tailored to higher-risk business activities. This may be at initiation or when certain new business enterprises are proposed, which may increase the bribery and corruption risk profile. Additionally, our zero-tolerance approach to bribery and corruption is communicated to all associated persons at the outset of the relationship by the manager responsible for appointing the associated person. Measuring effectiveness of our ABC Policy The effectiveness of our ABC Policy is assessed through a comprehensive framework that includes regular training and monitoring. Our employees complete mandatory training sessions to ensure they understand the policy and their responsibilities regarding bribery and corruption. Additionally, the effectiveness of the policy is assessed through the analysis of reported incidents and the outcomes of investigations related to potential breaches. ABC training Employee completion rate of anti- bribery and corruption training is the specific metric used to monitor the related IROs. For the current year all required employees completed this training within an 86 day window. Where an employee has not completed the required training within this window, these are non-compliant and reflected in a breaches register. Refer to page [351](#i408f7569c095494f86a844396a50e338_359822) for more information. Furthermore, while our mandatory training programs primarily focus on positions directly related to operational and compliance functions, support staff roles, such as security personnel and administrative assistants, are not included in these requirements, as their responsibilities do not align with the specific training objectives outlined in our sustainability strategy | | | | | --- | --- | --- | | | | | | Module name | Overview of module | Frequency of training | | Bribery and corruption | Addresses bribery and corruption, including abuse or entrusted power for private gain, giving, soliciting or accepting bribes and facilitation payments | 18 months | #### Legal and regulatory compliance IBP is committed to upholding high standards of integrity and ethical behaviour, which are fundamental to our core values. All employees adhere to applicable rules, regulations and conduct standards as detailed in IBP’s compliance and conduct manual (the Manual). This manual provides a comprehensive overview of the regulatory and legal environment in which IBP operates, guiding staff to relevant policies and outlining their personal responsibilities. Depending on their roles and business areas, employees may also follow additional policies and procedures to ensure full compliance and uphold our ethical standards. By adhering to these guidelines, IBP fosters a culture of accountability and professionalism, ensuring that our workforce consistently maintains its commitment to ethical conduct and regulatory compliance. • Scope of the policy: The Manual applies to all employees, including Executive and non-executive directors, full-time and part-time employees, consultants, contractors and intra- group secondees • Accountability: The IBP Board grants authority to IBP Compliance to perform its functions objectively, impartially, independently and to conduct assignments free from any bias or interference. As a result, there are independent compliance, legal and risk management functions in each of our core operating jurisdictions, which ensure that the Bank implements the required processes, practices and policies to adhere to applicable legislation and/or regulation and professional standards • Publication status: This internal policy was approved by the IBP Policy Review Committee (PRC) in April 2025. 355 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | Actions and performance IBP Compliance ensures that our business operates within the ever-evolving regulatory landscape. By identifying and clearly communicating applicable rules and requirements, our Compliance team helps management develop and implement best practice standards. They provide advice and guidance on how relevant regulations impact both existing and proposed business activities, ensuring that we stay ahead of compliance challenges. Additionally, IBP Compliance continuously monitors regulatory changes and developments. To maintain their expertise, our compliance team engages in various activities, including reviewing regulator communications, networking with compliance professionals from other organisations, maintaining memberships in relevant trade associations, attending industry seminars, and seeking third-party advice from law firms and management consultants. IBP compliance employs a risk-based monitoring system to ensure our business activities adhere to regulatory standards and internal policies, providing assurance to the Head of IBP Compliance, the IBP BRCC, and the Board. Our compliance monitoring includes four key approaches: targeted oversight by Compliance Advisers to manage identified risks, market surveillance to detect potential abuse and ensure proper order execution, an independent compliance monitoring programme approved by the IBP BRCC, and Group Standards Reviews that assess compliance across all IBP subsidiaries using a risk- based methodology. Findings from these monitoring activities are promptly communicated to business management and escalated through formal channels when significant issues arise. Additionally, results from our independent monitoring programmes are reported to the Head of IBP Compliance, the IBP Executive Committee (ExCo), relevant business unit leaders, and the R&CF. Measuring effectiveness of legal and regulatory compliance We assess the effectiveness of legal and regulatory compliance through annual internal audit evaluations and ongoing compliance monitoring. The compliance team notifies the relevant departments whenever new legal and regulatory requirements are introduced, ensuring that they remain aligned with current standards. Regulatory and legal compliance training Employee completion rate of UK regulations and compliance responsibilities training is the specific metric used to monitor the related IROs. For the current year all required employees completed this training within an 86 day window. Where an employee has not completed the required training within this window, these are non-compliant and reflected in a breaches register. Refer to page [351](#i408f7569c095494f86a844396a50e338_359822) for more information. Furthermore, while our mandatory training programs primarily focus on positions directly related to operational and compliance functions, support staff roles, such as security personnel and administrative assistants, are not included in these requirements, as their responsibilities do not align with the specific training objectives outlined in our sustainability strategy | | | | | --- | --- | --- | | | | | | Module name | Overview of module | Frequency of training | | Introduction to UK regulations and compliance responsibilities | Provides new joiners with an introduction to financial services UK regulation and the associated compliance responsibilities for all staff | One-off (new joiners only) | #### Transparency and disclosure IBP does not have a separate policy specifically for transparency and disclosure requirements. Instead, these responsibilities are integrated within our Compliance function to monitor and ensure that IBP adheres to all mandatory disclosure obligations and follows best practice guidelines. By incorporating transparency and disclosure oversight into our broader compliance framework, IBP maintains consistent and reliable reporting practices. Over the past year, IBP has implemented the CSRD Disclosures in response to our listed debt exposure on the Euronext Dublin exchange. These disclosure requirements were presented to and communicated with the Board, which monitored the implementation progress to ensure our reporting aligns with regulatory requirements. This execution underscores our commitment to transparency in our disclosures and meeting regulatory expectations. 356 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | --- | | | | | #### Directors responsibility statement for the sustainability statement The directors are responsible for the preparation of the Sustainability Statement and including the Sustainability Statement in a clearly identifiable and dedicated section of the Directors’ Report. The directors are also responsible for designing, implementing and maintaining such internal controls that they determine are relevant to enable the preparation of a Sustainability Statement in accordance with the Transparency (Directive 2004/109/EC) Regulations 2007 as amended that is free from material misstatement, whether due to fraud or error. In addition to the above, in preparing the Sustainability Statement, the directors are required to: • prepare the Sustainability Statement in accordance with the European Sustainability Reporting Standards (ESRS) including the selection and application of appropriate sustainability reporting methods; • present and report the double materiality assessment process performed by Investec Bank plc to identify the information required to be reported in the Sustainability Statement; • prepare the disclosures within the environmental section of the Sustainability Statement, in compliance with Article 8 of EU Regulation 2020/852 (the “Taxonomy Regulations”); • ensure that Investec Bank plc and its subsidiary undertakings maintains adequate records for the preparation of the Sustainability Statement and for the preparation and approval of other information presented with the Sustainability Statement; • make judgements and estimates that are reasonable in the circumstances including the identification and description of any inherent limitations in the measurement or evaluation of information in the Sustainability Statement; • prepare forward-looking information, where applicable, on the basis of disclosed assumptions about events that may occur in the future and possible future actions by Investec Bank plc and its subsidiary undertakings. The directors confirm, to the best of their knowledge and belief, that they have complied with the above requirements in preparing the Sustainability Statement. This Sustainability Statement forms part of the Investec Bank plc management report and has been approved by the Board. Signed on behalf of the Board: #### John Reizenstein Chairperson of the Board of Directors #### Ruth Leas Chief Executive Officer 19 June 2025 357 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | --- | | | | | Independent Practitioner’s Limited Assurance Report to the Directors of Investec Bank plc on the Sustainability Statement #### Our limited assurance conclusion We have performed a limited assurance engagement on the sustainability reporting set out in the consolidated sustainability statement (hereafter referred to as the ‘Sustainability Statement’) prepared by Investec Bank Plc and its subsidiary undertakings (“the Entity”), included in the “Corporate Sustainability Reporting Directive” section of the Directors’ Report of the Entity for the year ended 31 March 2025, prepared in accordance with Transparency (Directive 2004/109/EC) Regulations 2007 as amended (“the Regulations”). Based on the procedures performed and evidence obtained, nothing has come to our attention to cause us to believe that the Entity’s Sustainability Statement for the year ended 31 March 2025 is not prepared, in all material respects, in accordance with Regulation 5 of the Regulations, including: • the compliance of the Sustainability Statement with the European Sustainability Reporting Standards (ESRS); • the process carried out by the Entity to identify material sustainability related impacts, risks, and opportunities in accordance with ESRS; • the compliance with the reporting requirements of Article 8 of Regulation (EU) 2020/852 (the “Taxonomy Regulations”); and • the compliance with the requirement to mark up the Sustainability Statement in accordance with Article 3 of the Delegated Regulation (EU) 2019/815 on the specification of a single electronic reporting format (the “digital tagging requirements”). #### Basis for our conclusion We conducted our limited assurance engagement in accordance with International Standard on Assurance Engagements (ISAE) (Ireland) 3000, as adopted by the Irish Auditing and Accounting Supervisory Authority (IAASA). The procedures in a limited assurance engagement vary in nature and timing from, and are less in extent than for, a reasonable assurance engagement. Consequently, the level of assurance obtained in a limited assurance engagement is substantially lower than the assurance that would have been obtained had a reasonable assurance engagement been performed. Any internal control structure, no matter how effective, cannot eliminate the possibility that fraud, errors or irregularities may occur and remain undetected and because we use selective testing in our engagement, we cannot guarantee that all errors or irregularities, if present, will be detected. The Sustainability Statement includes prospective information such as ambitions, strategy, plans, expectations and estimates. Prospective information relates to events and actions that have not yet occurred and may never occur. We do not provide any assurance on the assumptions and achievability of this prospective information. Our responsibilities under this standard are further described in the section titled ‘Our responsibilities’ in this report. We are independent of the Entity in accordance with the International Code of Ethics for Professional Accountants (including International Independence Standards) issued by the International Ethics Standards Board for Accountants (IESBA Code), the independence requirements of the Companies Act 2014 and the Code of Ethics issued by Chartered Accountants Ireland that are relevant to our limited assurance engagement of the Sustainability Statement in Ireland. Our firm applies International Standard on Quality Management (ISQM) 1 (Ireland), Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related Services Engagements, issued by the IAASA. This standard requires the firm to design, implement and operate a system of quality management, including policies or procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our conclusion. Other matter – Compliance with the #### requirement to mark-up the Sustainability #### Statement We note that Regulation 5 of the Regulations requires us to report on the compliance by the Entity with the requirement to mark-up the Sustainability Statement in accordance with the digital tagging requirements. Regulation 5 of the Regulations requires that the Directors’ Report is prepared in the electronic reporting format specified in Article 3 of Delegated Regulation (EU) 2019/815 and shall mark-up the Sustainability Statement. However, at the time of issuing our limited assurance report, the electronic reporting format has not been specified nor become effective by Delegated Regulation. Consequently, the Entity is not required to mark-up the Sustainability Statement. Our conclusion is not modified in respect of this matter. #### Other information The directors are responsible for the other information. The other information comprises the information included in the Entity’s Annual Report but does not include the Sustainability Statement and our Limited Assurance Report thereon. Our limited assurance conclusion on the Sustainability Statement does not cover the other information and we do not express any form of assurance conclusion thereon. 358 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Responsibilities for the Sustainability #### Statement As explained more fully in the Directors Responsibility Statement for the Sustainability Statement, the responsibilities of the Directors include: • Preparing, measuring, presenting and reporting the Sustainability Statement in accordance with the applicable criteria, contained in the ESRS, the Regulations, preparing the disclosures in accordance with the reporting requirements provided for in the Taxonomy Regulations and any criteria used by the Entity to supplement and/or interpret the sustainability reporting framework criteria; and complying with the requirements to mark up the Sustainability Statement in accordance with the digital tagging requirements; • Developing, implementing and reporting its double materiality assessment process to identify the information reported in the Sustainability Statement in accordance with ESRS and for disclosing this process in the Sustainability Statement. This responsibility includes identifying and engaging with the Entity’s stakeholders as identified in the Entity’s double materiality assessment process (stakeholders) to understand their information needs;and • In reporting forward-looking information in accordance with ESRS, management of the Entity is required to prepare the forward-looking information on the basis of disclosed assumptions about events that may occur in the future and possible future actions by the Entity. Those charged with governance are also responsible for overseeing the Entity’s Sustainability Statement reporting process. Inherent limitations in preparing the #### Sustainability Statement We obtained limited assurance over the preparation of the Sustainability Statement in accordance with the Regulations. Inherent limitations exist in all assurance engagements. We draw your attention to the following specific limitations regarding the measurement or evaluation of the Sustainability Statement subject to limited assurance: • The Sustainability Statement contains qualitative, quantitative, objective, subjective, historical and prospective disclosures which represent a significant degree of uncertainty. The selection by management of different but acceptable estimation, approximation or forecasting techniques, could have resulted in materially different amounts or disclosures being reported. For the avoidance of doubt, the scope of our engagement and our responsibilities did not involve us performing work necessary for any assurance on the reliability, proper compilation, or accuracy of the prospective information. • As described in the Entity’s Greenhouse Gas (“GHG”) emissions disclosures on page [325](#id692d188e16a4d9a8634dec099e88221_684341) Scope 3 financed emissions, category 15: investments, are subject to a high level of measurement uncertainty due to the limitations in methodology and data, including the reliance on data provided by third parties. #### Our responsibilities Our objectives are to plan and perform the assurance engagement to obtain limited assurance about whether the Sustainability Statement in scope of our conclusion, is free from material misstatement, whether due to fraud or error, and to issue a Limited Assurance Report that includes our conclusion. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence decisions of users on the basis of the Sustainability Statement. As part of a limited assurance engagement in accordance with ISAE (Ireland) 3000, we exercise professional judgment and maintain professional skepticism throughout the engagement. We also: • Perform risk assessment procedures, including obtaining an understanding of internal controls relevant to the engagement, to identify disclosures where material misstatements are likely to arise, whether due to fraud or error, but not for the purpose of providing a conclusion on the effectiveness of the Entity’s internal control. • Design and perform procedures responsive to where material misstatements are likely to arise in the Sustainability Statement. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. • Design and perform procedures to evaluate whether the Sustainability Statement has been prepared in accordance with the ESRS, which includes the process carried out by the Entity to identify material sustainability related impacts, risks and opportunities. • Design and perform procedures to evaluate whether the Sustainability Statement has been prepared in in compliance with the Taxonomy Regulations. • With respect to our conclusion in respect to the Entity’s reporting obligations and responsibility to mark up the Sustainability Statement in accordance with the digital tagging requirements, we assess whether we have become aware of anything to suggest that the Sustainability Statement has not been prepared, in all material respects in this specified format. However, as explained in the ‘Other matter- Compliance with the requirement to mark-up the Sustainability Statement’ section of our assurance report, the Entity is not currently required to mark-up the Sustainability Statement. 359 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | #### Summary of the work performed A limited assurance engagement involves performing procedures to obtain evidence about the Sustainability Statement. The nature, timing and extent of procedures selected depend on professional judgment, including the identification of disclosures where material misstatements are likely to arise, whether due to fraud or error, in the Sustainability Statement. The procedures in a limited assurance engagement vary in nature and timing from, and are less in extent than for, a reasonable assurance engagement and depend on professional judgment, including the identification of disclosures where material misstatements are likely to arise, whether due to fraud or error, in the Sustainability Statement. Consequently, the level of assurance obtained in a limited assurance engagement is substantially lower than the assurance that would have been obtained had a reasonable assurance engagement been performed. In conducting our limited assurance engagement, the procedures we have performed included the following: • Performing risk assessment procedures to understand the Entity and its environment, including the Entity’s reporting boundary and its value chain information; • Obtaining an understanding of the Entity’s double materiality assessment process by performing inquiries to understand the sources of the information used by management and reviewing the Entity’s internal documentation of this process; • Performing inquiries of management and others within the Entity to understand the subject matter and the criteria used for evaluation, as well as to identify any significant changes to the subject matter or systems used to generate it during the year ended 31 March 2025; • Performing analytical procedures to identify relationships and individual items that appear unusual; • Designing and performing further assurance procedures (which included inquiries and inspection of evidence where applicable) to respond to the identified risks of material misstatement; • Reading the other information in the Annual Report to identify material inconsistencies, if any, with the Sustainability Statement; and • Considering, based on our limited assurance procedures and evaluation of the assurance evidence obtained, whether the Sustainability Statement as a whole is free from material misstatements and prepared in accordance with the applicable criteria. #### Use of our Report Our report is made solely in accordance with the requirements of the Regulations to the Directors of the Entity. Our assurance work has been undertaken so that we might state to the Directors those matters we are required to state to them in a limited assurance report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Entity and its Directors, as a body, for our limited assurance work, for this report, or for the conclusions we have formed. Rory Brown For and on behalf of Deloitte Ireland LLP 19 June 2025 360 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | --- | | | | | #### Appendix to the Sustainability Statement #### Sustainability Statement content index: Reported topics from DMA This reference index serves as a navigational tool, guiding stakeholders to the respective sections where the disclosure requirements of the applicable ESRSs are covered. In the table below, indicate where we have applied phased-in provisions, where disclosures were incorporated by reference or where a disclosure requirement is not applicable. These are indicated as follows: | | | | --- | --- | | | | | PP | Phased-in provision | | IR | Incorporated by reference | | NA | Disclosure not applicable | | VD | Voluntary disclosure | | | | | | | --- | --- | --- | --- | | | | | | | ESRS 2: General disclosure requirement | Reference/remarks | Pg | Key | | BP: Basis of preparation | | | | | BP-1 – General basis of preparation | General information – Basis of preparation | [296](#i118dad0ceb4f4298bf840dcaa1b17113_5340) | | | BP-2 – Disclosures in relation to specific circumstances | Disclosure in relation to specific circumstances | [296](#i118dad0ceb4f4298bf840dcaa1b17113_20259) | | | | | | | | GOV: Governance | | | | | GOV-1 – The role of the administrative, management and supervisory bodies | | [297](#i118dad0ceb4f4298bf840dcaa1b17113_631679) | | | GOV-1 – Composition and diversity of the board | The Board – Who we are | [68](#i8f0a10dffafc44b2b58586afe778cb52_0-0-1-1-2664967) | IR | | G1: GOV-1 – The role of the administrative, management and supervisory bodies | | | | | GOV-2 – Information provided to and sustainability matters addressed by the undertaking’s administrative, management and supervisory bodies | Governance and oversight of IROs | [297](#i118dad0ceb4f4298bf840dcaa1b17113_631679) | | | GOV-3 – Integration of sustainability-related performance in incentive schemes | Investec Bank plc does not currently integrate sustainability-related performance in incentive schemes | | NA | | E1. GOV-3 – Integration of sustainability-related performance in incentive schemes | | GOV-4 – Statement on due diligence | Statement on due diligence | [305](#i118dad0ceb4f4298bf840dcaa1b17113_61601) | | | GOV-5 – Risk management and internal controls over sustainability reporting | Risk management and internal controls over sustainability reporting | [305](#i118dad0ceb4f4298bf840dcaa1b17113_61881) | | | | | | | | SBM: Strategy | | | | | SBM-1 – Strategy, business model and value chain | | | | | SBM-2 – Interests and views of stakeholders | Interests and views of our stakeholders | [308](#i118dad0ceb4f4298bf840dcaa1b17113_142750) | | | S1. SBM-2 – Interests and views of stakeholders | Incorporated by reference | [15](#i447e4d363cd344738300acdd42f0e3a0_88) | IR | | S4. SBM-2 – Interests and views of stakeholders | Incorporated by reference | [15](#i447e4d363cd344738300acdd42f0e3a0_88) | IR | | SBM-3 – Material IROs and their interaction with strategy and business model | | | | | E1. SBM-3 – Material IROs and their interaction with strategy and business model | Material IROs relating to climate change | [321](#id692d188e16a4d9a8634dec099e88221_623540) | | | S1. SBM-3 – Material IROs and their interaction with strategy and business model | Our people | [335](#ie588ca37b98f4c428b70390c95ba5a4c_104) | | | S4. SBM-3 – Material IROs and their interaction with strategy and business model | Our clients | [343](#i13a712e9cf754173b39d1d43c119468c_19874) | | | | | | | | IRO: Impact, risk and opportunity management | | | | | IRO-1 – Description of the processes to identify and assess material IROs | | | | | E1. IRO-1 – Description of the processes to identify and assess material IROs | Resilience of our strategy and business model in relation to climate change | [327](#id692d188e16a4d9a8634dec099e88221_623541) | | | IRO-2 – Disclosure requirements in ESRS covered by the undertaking’s Sustainability Statement | | | | 361 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | ESRS E1: Climate change | Reference/remarks | Pg | Key | | E1-1 – Transition plan for climate change mitigation | IBP have not yet adopted a transition plan | [321](#id692d188e16a4d9a8634dec099e88221_623480) | NA | | E1-2 – Policies related to climate change mitigation and adaptation | Our policies relating to climate change | [323](#id692d188e16a4d9a8634dec099e88221_623542) | | | E1-3 – Actions and resources in relation to climate change policies | | [323](#id692d188e16a4d9a8634dec099e88221_623542) | | | E1-4 – Targets related to climate change mitigation and adaptation | IBP disclosed targets relating to fossil fuels | [323](#id692d188e16a4d9a8634dec099e88221_623542) | | | E1-5 – Energy consumption and mix | Not material based on our DMA outcome | | NA | | E1-6 – Gross Scopes 1, 2, 3 and total GHG emissions | Based on the DMA outcome Scope 3 Category 15 Financed Emissions was considered material and operational emissions was not material | [324](#id692d188e16a4d9a8634dec099e88221_667913) | | | E1-7 – GHG removals and GHG mitigation projects financed through carbon credits | Not material based on our DMA outcome | | NA | | E1-8 – Internal carbon pricing | IBP does not apply an internal carbon price | | NA | | E1-9 – Anticipated financial effects from material physical and transition risks and potential climate-related opportunities | Omitted – phased-in provision | | PP | | E1 – Minimum Disclosure Requirements regarding policies (MDR-P) and actions (MDR-A) | Climate change | [323](#id692d188e16a4d9a8634dec099e88221_623542) | | | E1 – Minimum Disclosure Requirements regarding metrics (MDR-M) and targets (MDR-T) | Climate change | [323](#id692d188e16a4d9a8634dec099e88221_623542) | | | | | | | | --- | --- | --- | --- | | | | | | | ESRS S1: Our people | Reference/remarks | Pg | Key | | S1-1 – Policies related to our people | Policies relating to our people | [338](#ie588ca37b98f4c428b70390c95ba5a4c_355543) | | | S1:2 – Process for engaging with own workforce and workers; representation about impacts | Engaging with our people | [337](#ie588ca37b98f4c428b70390c95ba5a4c_618741) | | | S1-3 – Processes to remediate negative impacts and channels for our people to raise concerns | Remediating negative impacts | [343](#ie588ca37b98f4c428b70390c95ba5a4c_663699) | | | S1-4 – Taking action on material impacts on our people, and approach to mitigating material risks and pursuing opportunities related to our people, and effectiveness of those actions | Remediating negative impacts | [343](#ie588ca37b98f4c428b70390c95ba5a4c_663699) | | | S1-5 – Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities | Engaging with our people | [337](#ie588ca37b98f4c428b70390c95ba5a4c_618741) | | | S1-6 – Characteristics of undertakings employees | Our employees | [336](#ie588ca37b98f4c428b70390c95ba5a4c_776821) | | | S1-7 – Characteristics of non-employee workers in the undertaking’s own workforce | Omitted – phased-in provision | | PP | | S1-8 – Collective bargaining coverage and social dialogue | Not material based on our DMA outcome | | NA | | S1-9 – Diversity metrics | Diversity metrics | [341](#ie588ca37b98f4c428b70390c95ba5a4c_776822) | | | S1-10 – Adequate wages | Not material based on our DMA outcome | | NA | | S1-11 – Social protection | Not material based on our DMA outcome | | NA | | S1-12 – Persons with disabilities | Not material based on our DMA outcome | | NA | | S1-13 – Training and skills development metrics | Not material based on our DMA outcome | | NA | | S1-14 – Health and safety metrics | Not material based on our DMA outcome | | NA | | S1-15 – Work-life balance metrics | Not material based on our DMA outcome | | NA | | S1-16 – Compensation metrics (pay gap and total compensation) | Employee remuneration | [339](#ie588ca37b98f4c428b70390c95ba5a4c_764164) | | | S1-17 – Incidents, complaints and severe human rights impacts | Incidents, complaints and severe human rights impacts | [339](#i746cb5837a4845da90abb8439a345efa_0-0-1-1-2968033) | | | S1 – Minimum Disclosure Requirements regarding policies (MDR-P) and actions (MDR-A) | Our people | [336](#ie588ca37b98f4c428b70390c95ba5a4c_764162) | | | S1 – Minimum Disclosure Requirements regarding metrics (MDR-M) and targets (MDR-T) | Our people | [336](#ie588ca37b98f4c428b70390c95ba5a4c_764162) | | 362 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 06 | | Sustainability statement | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | SUSTAINABILITY STATEMENT CONTINUED | | | | | | | | | | | | --- | --- | --- | --- | | | | | | | ESRS S4: Our clients | Reference/remarks | Pg | Key | | S4-1 – Policies related to consumers and end-users | Policies related to our clients | [344](#i13a712e9cf754173b39d1d43c119468c_291998) | | | S4-2 – Processes for engaging with own consumers and end-users about impact | • Client engagement and marketing • Data privacy • Cyber security | [345](#i13a712e9cf754173b39d1d43c119468c_300374) [346](#i13a712e9cf754173b39d1d43c119468c_19796) [347](#i13a712e9cf754173b39d1d43c119468c_19797) | | | S4-3 – Processes to remediate negative impacts and channels for consumers and end-users to raise concerns | • Client engagement and marketing • Data privacy • Cyber security | [346](#i13a712e9cf754173b39d1d43c119468c_19796) [346](#i13a712e9cf754173b39d1d43c119468c_19796) [347](#i13a712e9cf754173b39d1d43c119468c_19797) | | | S4-4 – Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end-users, and effectiveness of those actions | • Client engagement and marketing • Data privacy • Cyber security | [346](#i13a712e9cf754173b39d1d43c119468c_19796) [346](#i13a712e9cf754173b39d1d43c119468c_19796) [347](#i13a712e9cf754173b39d1d43c119468c_19797) | | | S4-5 – Targets relating to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities | Targets relating to our clients | [343](#i13a712e9cf754173b39d1d43c119468c_19874) | | | S4 – Minimum Disclosure Requirements regarding policies (MDR-P) and actions (MDR-A) | Our clients | [344](#i13a712e9cf754173b39d1d43c119468c_291998) | | | S4 – Minimum Disclosure Requirements regarding metrics (MDR-M) and targets (MDR-T) | Our clients | [344](#i13a712e9cf754173b39d1d43c119468c_291998) | | | | | | | | --- | --- | --- | --- | | | | | | | ESRS G1: Business conduct | Reference/ remarks | Pg | Key | | Governance | | | | | G1-1 – Business conduct policies and corporate culture | Corporate culture | [350](#i408f7569c095494f86a844396a50e338_371348) | | | G1-2 – Management of relationship with suppliers | Not material based on our DMA outcome | | NA | | G1-3 – Prevention and detection of corruption and bribery | Procedures in place to prevent and detect bribery and corruption | [354](#i408f7569c095494f86a844396a50e338_158948) | | | G1-4 – Incidents of corruption and bribery | Incidents of bribery and corruption | [353](#i408f7569c095494f86a844396a50e338_371347) | | | G1-5 – Political influence and lobbying activities | Not material based on our DMA outcome | | NA | | G1-6 – Payment practices | Not material based on our DMA outcome | | NA | | G1 – Minimum Disclosure Requirements regarding policies (MDR-P) and actions (MDR-A) | Business conduct | [350](#i408f7569c095494f86a844396a50e338_371348) | | | G1 – Minimum Disclosure Requirements regarding metrics (MDR-M) and targets (MDR-T) | Business conduct | [350](#i408f7569c095494f86a844396a50e338_371348) | | 22 Based on the Turnover KPI of the counterparty. 23 Based on the CapEx KPI of the counterparty, except for lending activities where for general lending Turnover KPI is used. 24 % of assets covered by the KPI over banks´ total assets. 25 For credit institutions that do not meet the conditions of Article 94(1) of the CRR or the conditions set out in Article 325a(1) of the CRR. 26 Fees and commissions income from services other than lending and AuM. 363 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES | | | | | | #### EU Taxonomy tables | | | | | --- | --- | --- | | | | | | Template number | Name | Page number | | 0 | Summary of KPIs | [363](#i447e4d363cd344738300acdd42f0e3a0_3091) | | 1 | Assets for the calculation of GAR – Turnover and CapEx based | [364](#i447e4d363cd344738300acdd42f0e3a0_3107) | | 2 | GAR sector information – Turnover and CapEx based | [372](#i447e4d363cd344738300acdd42f0e3a0_3122) | | 3 | GAR KPI stock – Turnover and CapEx based | [374](#i447e4d363cd344738300acdd42f0e3a0_3136) | | 4 | GAR KPI flow – Turnover and CapEx based | [382](#i447e4d363cd344738300acdd42f0e3a0_3150) | | 5 | KPI off-balance sheet exposures | [390](#i447e4d363cd344738300acdd42f0e3a0_3845) | | 6 | Nuclear and fossil gas related activities | [391](#i447e4d363cd344738300acdd42f0e3a0_3815) | 0. Summary of KPIs to be disclosed by credit institutions under Article 8 #### Taxonomy Regulation | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Total environmentally sustainable assets (£’000) | Turnover KPI (%) 22 | CapEx KPI (%) 23 | % coverage (over total assets) 24 | % of assets excluded from the numerator of the GAR | % of assets excluded from the denominator of the GAR | | Main KPI | GAR stock | 25 059 | 0.11% | 0.13% | 75% | 61% | 25% | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Total environmentally sustainable assets (£’000) | Turnove r KPI (%)21 | CapEx KPI (%)22 | % coverage (over total assets)23 | % of assets excluded from the numerator of the GAR | % of assets excluded from the denominator of the GAR | | Additional KPIs | GAR (flow) | 1 515 | 0.06% | 0.07% | 7.87% | 4.42% | –% | | | Trading book 25 | n/a | n/a | n/a | n/a | n/a | n/a | | | Financial guarantees | — | —% | —% | —% | —% | —% | | | Assets under management | — | —% | —% | —% | —% | —% | | | Fees and commissions income 26 | n/a | n/a | n/a | n/a | n/a | n/a | 364 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 1. Assets for the calculation of GAR – Turnover | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | £’000 | | 31 March 2025 | | | | | | | Total gross carrying amount (£’000) | Climate Change Mitigation (CCM) | | | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which transitional | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | | 1 | Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | 4 589 598 | 3 787 932 | 25 035 | — | 2 894 | 2 053 | | 2 | Financial undertakings | 594 431 | 180 661 | 22 360 | — | 1 282 | 1 214 | | 3 | Credit institutions | 593 845 | 180 661 | 22 360 | — | 1 282 | 1 214 | | 4 | Loans and advances | 593 845 | 180 661 | 22 360 | — | 1 282 | 1 214 | | 5 | Debt securities, including UoP | — | — | — | — | — | — | | 6 | Equity instruments | — | — | — | — | — | — | | 7 | Other financial corporations | 586 | — | — | — | — | — | | 8 | of which investment firms | — | — | — | — | — | — | | 9 | Loans and advances | — | — | — | — | — | — | | 10 | Debt securities, including UoP | — | — | — | — | — | — | | 11 | Equity instruments | — | — | — | — | — | — | | 12 | of which management companies | — | — | — | — | — | — | | 13 | Loans and advances | — | — | — | — | — | — | | 14 | Debt securities, including UoP | — | — | — | — | — | — | | 15 | Equity instruments | — | — | — | — | — | — | | 16 | of which insurance undertakings | — | — | — | — | — | — | | 17 | Loans and advances | — | — | — | — | — | — | | 18 | Debt securities, including UoP | — | — | — | — | — | — | | 19 | Equity instruments | — | — | — | — | — | — | | 20 | Non-financial undertakings | 22 201 | 8 701 | 2 675 | — | 1 612 | 839 | | 21 | Loans and advances | 12 117 | 8 685 | 2 675 | — | 1 612 | 839 | | 22 | Debt securities, including UoP | 10 084 | 16 | — | — | — | — | | 23 | Equity instruments | — | — | — | — | — | — | | 24 | Households | 3 972 965 | 3 598 570 | — | — | — | — | | 25 | of which loans collateralised by residential immovable property | 3 598 570 | 3 598 570 | — | — | — | — | | 26 | of which building renovation loans | — | — | — | — | — | — | | 27 | of which motor vehicle loans | — | — | — | — | — | — | | 28 | Local government financing | — | — | — | — | — | — | | 29 | House financing | — | — | — | — | — | — | | 30 | Other local government financing | — | — | — | — | — | — | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | — | — | — | — | — | — | | 32 | Assets excluded from the numerator for GAR calculation (covered in the denominator) | 18 821 766 | — | — | — | — | — | | 33 | Financial and non-financial undertakings | 16 242 340 | — | — | — | — | — | | 34 | SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations | 2 144 431 | — | — | — | — | — | | 35 | Loans and advances | 2 021 749 | — | — | — | — | — | | 36 | of which loans collateralised by commercial immovable property | — | — | — | — | — | — | | 37 | of which building renovation loans | — | — | — | — | — | — | | 38 | Debt securities | 106 134 | — | — | — | — | — | | 39 | Equity instruments | 16 548 | — | — | — | — | — | | 40 | Non-EU country counterparties not subject to NFRD disclosure obligations | 14 097 909 | — | — | — | — | — | | 41 | Loans and advances | 12 201 536 | — | — | — | — | — | | 42 | Debt securities | 1 484 172 | — | — | — | — | — | | 43 | Equity instruments | 412 201 | — | — | — | — | — | | 44 | Derivatives | 299 413 | — | — | — | — | — | | 45 | On-demand interbank loans | 558 863 | — | — | — | — | — | | 46 | Cash and cash-related assets | 151 472 | — | — | — | — | — | | 47 | Other categories of assets (e.g. goodwill, commodities, etc.) | 1 569 678 | — | — | — | — | — | | 48 | Total GAR assets | 23 411 364 | 3 787 932 | 25 035 | — | 2 894 | 2 053 | | 49 | Assets not covered for GAR calculation | 7 666 881 | — | — | — | — | — | | 50 | Central governments and supranational issuers | 2 546 650 | — | — | — | — | — | | 51 | Central banks exposure | 4 672 715 | — | — | — | — | — | | 52 | Trading book | 447 515 | — | — | — | — | — | | 53 | Total assets | 31 078 245 | 3 787 932 | 25 035 | — | 2 894 | 2 053 | | Off-balance sheet exposures – Undertakings subject to NFRD disclosure obligations | | | | | | | | | 54 | Financial guarantees | — | — | — | — | — | — | | 55 | Assets under management | — | — | — | — | — | — | | 56 | Of which debt securities | — | — | — | — | — | — | | 57 | Of which equity instruments | — | — | — | — | — | — | 365 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 1. Assets for the calculation of GAR – Turnover continued | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | | | Climate Change Adaptation (CCA) | | | | Water and marine resources (WTR) | | | | Circular Economy (CE) | | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | | | | | | | | | | | | | 616 | 24 | — | — | 54 | — | — | — | 235 | — | — | — | | 616 | 24 | — | — | 54 | — | — | — | 235 | — | — | — | | 616 | 24 | — | — | 54 | — | — | — | 235 | — | — | — | | 616 | 24 | — | — | 54 | — | — | — | 235 | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | 616 | 24 | — | — | 54 | — | — | — | 235 | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | 616 | 24 | — | — | 54 | — | — | — | 235 | — | — | — | | | | | | | | | | | | | | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | 366 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 1. Assets for the calculation of GAR – Turnover continued | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | £’000 | | 31 March 2025 | | | | | | | Pollution (PPC) | | | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | 1 | Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | | 117 | — | — | — | | 2 | Financial undertakings | | 117 | — | — | — | | 3 | Credit institutions | | 117 | — | — | — | | 4 | Loans and advances | | 117 | — | — | — | | 5 | Debt securities, including UoP | | — | — | — | — | | 6 | Equity instruments | | — | — | — | — | | 7 | Other financial corporations | | — | — | — | — | | 8 | of which investment firms | | — | — | — | — | | 9 | Loans and advances | | — | — | — | — | | 10 | Debt securities, including UoP | | — | — | — | — | | 11 | Equity instruments | | — | — | — | — | | 12 | of which management companies | | — | — | — | — | | 13 | Loans and advances | | — | — | — | — | | 14 | Debt securities, including UoP | | — | — | — | — | | 15 | Equity instruments | | — | — | — | — | | 16 | of which insurance undertakings | | — | — | — | — | | 17 | Loans and advances | | — | — | — | — | | 18 | Debt securities, including UoP | | — | — | — | — | | 19 | Equity instruments | | — | — | — | — | | 20 | Non-financial undertakings | | — | — | — | — | | 21 | Loans and advances | | — | — | — | — | | 22 | Debt securities, including UoP | | — | — | — | — | | 23 | Equity instruments | | — | — | — | — | | 24 | Households | | — | — | — | — | | 25 | of which loans collateralised by residential immovable property | | — | — | — | — | | 26 | of which building renovation loans | | — | — | — | — | | 27 | of which motor vehicle loans | | — | — | — | — | | 28 | Local government financing | | — | — | — | — | | 29 | House financing | | — | — | — | — | | 30 | Other local government financing | | — | — | — | — | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | | — | — | — | — | | 32 | Assets excluded from the numerator for GAR calculation (covered in the denominator) | | — | — | — | — | | 33 | Financial and non-financial undertakings | | — | — | — | — | | 34 | SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations | | — | — | — | — | | 35 | Loans and advances | | — | — | — | — | | 36 | of which loans collateralised by commercial immovable property | | — | — | — | — | | 37 | of which building renovation loans | | — | — | — | — | | 38 | Debt securities | | — | — | — | — | | 39 | Equity instruments | | — | — | — | — | | 40 | Non-EU country counterparties not subject to NFRD disclosure obligations | | — | — | — | — | | 41 | Loans and advances | | — | — | — | — | | 42 | Debt securities | | — | — | — | — | | 43 | Equity instruments | | — | — | — | — | | 44 | Derivatives | | — | — | — | — | | 45 | On-demand interbank loans | | — | — | — | — | | 46 | Cash and cash-related assets | | — | — | — | — | | 47 | Other categories of assets (e.g. goodwill, commodities, etc.) | | — | — | — | — | | 48 | Total GAR assets | | 117 | — | — | — | | 49 | Assets not covered for GAR calculation | | — | — | — | — | | 50 | Central governments and supranational issuers | | — | — | — | — | | 51 | Central banks exposure | | — | — | — | — | | 52 | Trading book | | — | — | — | — | | 53 | Total assets | | 117 | — | — | — | | Off-balance sheet exposures – Undertakings subject to NFRD disclosure obligations | | | | | | | | 54 | Financial guarantees | | — | — | — | — | | 55 | Assets under management | | — | — | — | — | | 56 | Of which debt securities | | — | — | — | — | | 57 | Of which equity instruments | | — | — | — | — | 367 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 1. Assets for the calculation of GAR – Turnover continued | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | Biodiversity and Ecosystems (BIO) | | | | TOTAL (CCM + CCA + WTR +CE + PPC + BIO) | | | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which transitional | Of which enabling | | | | | | | | | | | | 16 | — | — | — | 3 788 970 | 25 059 | — | 2 894 | 2 053 | | 16 | — | — | — | 181 699 | 22 384 | — | 1 282 | 1 214 | | 16 | — | — | — | 181 699 | 22 384 | — | 1 282 | 1 214 | | 16 | — | — | — | 181 699 | 22 384 | — | 1 282 | 1 214 | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | 8 701 | 2 675 | — | 1 612 | 839 | | — | — | — | — | 8 685 | 2 675 | — | 1 612 | 839 | | — | — | — | — | 16 | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | 3 598 570 | — | — | — | — | | — | — | — | — | 3 598 570 | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | 16 | — | — | — | 3 788 969 | 25 059 | — | 2 894 | 2 053 | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | 16 | — | — | — | 3 788 969 | 25 059 | — | 2 894 | 2 053 | | | | | | | | | | | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | 368 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 1. Assets for the calculation of GAR – CapEx | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | £’000 | | 31 March 2025 | | | | | | | Total gross carrying amount (£’000) | Climate Change Mitigation (CCM) | | | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which transitional | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | | 1 | Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | 4 589 598 | 3 798 628 | 29 604 | — | 5 131 | 2 283 | | 2 | Financial undertakings | 594 431 | 183 661 | 25 763 | — | 2 001 | 2 102 | | 3 | Credit institutions | 593 845 | 183 661 | 25 763 | — | 2 001 | 2 102 | | 4 | Loans and advances | 593 845 | 183 661 | 25 763 | — | 2 001 | 2 102 | | 5 | Debt securities, including UoP | — | — | — | — | — | — | | 6 | Equity instruments | — | — | — | — | — | — | | 7 | Other financial corporations | 586 | — | — | — | — | — | | 8 | of which investment firms | — | — | — | — | — | — | | 9 | Loans and advances | — | — | — | — | — | — | | 10 | Debt securities, including UoP | — | — | — | — | — | — | | 11 | Equity instruments | — | — | — | — | — | — | | 12 | of which management companies | — | — | — | — | — | — | | 13 | Loans and advances | — | — | — | — | — | — | | 14 | Debt securities, including UoP | — | — | — | — | — | — | | 15 | Equity instruments | — | — | — | — | — | — | | 16 | of which insurance undertakings | — | — | — | — | — | — | | 17 | Loans and advances | — | — | — | — | — | — | | 18 | Debt securities, including UoP | — | — | — | — | — | — | | 19 | Equity instruments | — | — | — | — | — | — | | 20 | Non-financial undertakings | 22 201 | 16 397 | 3 841 | — | 3 130 | 181 | | 21 | Loans and advances | 12 117 | 7 406 | 3 841 | — | 3 130 | 181 | | 22 | Debt securities, including UoP | 10 084 | 8 991 | — | — | — | — | | 23 | Equity instruments | — | — | — | — | — | — | | 24 | Households | 3 972 965 | 3 598 570 | — | — | — | — | | 25 | of which loans collateralised by residential immovable property | 3 598 570 | 3 598 570 | — | — | — | — | | 26 | of which building renovation loans | — | — | — | — | — | — | | 27 | of which motor vehicle loans | — | — | — | — | — | — | | 28 | Local government financing | — | — | — | — | — | — | | 29 | House financing | — | — | — | — | — | — | | 30 | Other local government financing | — | — | — | — | — | — | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | — | — | — | — | — | — | | 32 | Assets excluded from the numerator for GAR calculation (covered in the denominator) | 18 821 766 | — | — | — | — | — | | 33 | Financial and non-financial undertakings | 16 242 340 | — | — | — | — | — | | 34 | SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations | 2 144 431 | — | — | — | — | — | | 35 | Loans and advances | 2 021 749 | — | — | — | — | — | | 36 | of which loans collateralised by commercial immovable property | — | — | — | — | — | — | | 37 | of which building renovation loans | — | — | — | — | — | — | | 38 | Debt securities | 106 134 | — | — | — | — | — | | 39 | Equity instruments | 16 548 | — | — | — | — | — | | 40 | Non-EU country counterparties not subject to NFRD disclosure obligations | 14 097 909 | — | — | — | — | — | | 41 | Loans and advances | 12 201 536 | — | — | — | — | — | | 42 | Debt securities | 1 484 172 | — | — | — | — | — | | 43 | Equity instruments | 412 201 | — | — | — | — | — | | 44 | Derivatives | 299 413 | — | — | — | — | — | | 45 | On-demand interbank loans | 558 863 | — | — | — | — | — | | 46 | Cash and cash-related assets | 151 472 | — | — | — | — | — | | 47 | Other categories of assets (e.g. goodwill, commodities, etc.) | 1 569 678 | — | — | — | — | — | | 48 | Total GAR assets | 23 411 364 | 3 798 628 | 29 604 | — | 5 131 | 2 283 | | 49 | Assets not covered for GAR calculation | 7 666 881 | — | — | — | — | — | | 50 | Central governments and supranational issuers | 2 546 650 | — | — | — | — | — | | 51 | Central banks exposure | 4 672 715 | — | — | — | — | — | | 52 | Trading book | 447 515 | — | — | — | — | — | | 53 | Total assets | 31 078 245 | 3 798 628 | 29 604 | — | 5 131 | 2 283 | | Off-balance sheet exposures – Undertakings subject to NFRD disclosure obligations | | | | | | | | | 54 | Financial guarantees | — | — | — | — | — | — | | 55 | Assets under management | — | — | — | — | — | — | | 56 | Of which debt securities | — | — | — | — | — | — | | 57 | Of which equity instruments | — | — | — | — | — | — | 369 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 1. Assets for the calculation of GAR – CapEx continued | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | | | Climate Change Adaptation (CCA) | | | | Water and marine resources (WTR) | | | | Circular Economy (CE) | | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | | | | | | | | | | | | | 801 | 24 | — | — | 93 | — | — | — | 319 | — | — | — | | 788 | 24 | — | — | 93 | — | — | — | 319 | — | — | — | | 788 | 24 | — | — | 93 | — | — | — | 319 | — | — | — | | 788 | 24 | — | — | 93 | — | — | — | 319 | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | 13 | — | — | — | — | — | — | — | — | — | — | — | | 7 | — | — | — | — | — | — | — | — | — | — | — | | 6 | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | 801 | 24 | — | — | 93 | — | — | — | 319 | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | 801 | 24 | — | — | 93 | — | — | — | 319 | — | — | — | | | | | | | | | | | | | | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | — | — | — | 370 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 1. Assets for the calculation of GAR – CapEx continued | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | £’000 | | 31 March 2025 | | | | | | | Pollution (PPC) | | | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | 1 | Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | | 70 | — | — | — | | 2 | Financial undertakings | | 70 | — | — | — | | 3 | Credit institutions | | 70 | — | — | — | | 4 | Loans and advances | | 70 | — | — | — | | 5 | Debt securities, including UoP | | — | — | — | — | | 6 | Equity instruments | | — | — | — | — | | 7 | Other financial corporations | | — | — | — | — | | 8 | of which investment firms | | — | — | — | — | | 9 | Loans and advances | | — | — | — | — | | 10 | Debt securities, including UoP | | — | — | — | — | | 11 | Equity instruments | | — | — | — | — | | 12 | of which management companies | | — | — | — | — | | 13 | Loans and advances | | — | — | — | — | | 14 | Debt securities, including UoP | | — | — | — | — | | 15 | Equity instruments | | — | — | — | — | | 16 | of which insurance undertakings | | — | — | — | — | | 17 | Loans and advances | | — | — | — | — | | 18 | Debt securities, including UoP | | — | — | — | — | | 19 | Equity instruments | | — | — | — | — | | 20 | Non-financial undertakings | | — | — | — | — | | 21 | Loans and advances | | — | — | — | — | | 22 | Debt securities, including UoP | | — | — | — | — | | 23 | Equity instruments | | — | — | — | — | | 24 | Households | | — | — | — | — | | 25 | of which loans collateralised by residential immovable property | | — | — | — | — | | 26 | of which building renovation loans | | — | — | — | — | | 27 | of which motor vehicle loans | | — | — | — | — | | 28 | Local government financing | | — | — | — | — | | 29 | House financing | | — | — | — | — | | 30 | Other local government financing | | — | — | — | — | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | | — | — | — | — | | 32 | Assets excluded from the numerator for GAR calculation (covered in the denominator) | | — | — | — | — | | 33 | Financial and non-financial undertakings | | — | — | — | — | | 34 | SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations | | — | — | — | — | | 35 | Loans and advances | | — | — | — | — | | 36 | of which loans collateralised by commercial immovable property | | — | — | — | — | | 37 | of which building renovation loans | | — | — | — | — | | 38 | Debt securities | | — | — | — | — | | 39 | Equity instruments | | — | — | — | — | | 40 | Non-EU country counterparties not subject to NFRD disclosure obligations | | — | — | — | — | | 41 | Loans and advances | | — | — | — | — | | 42 | Debt securities | | — | — | — | — | | 43 | Equity instruments | | — | — | — | — | | 44 | Derivatives | | — | — | — | — | | 45 | On-demand interbank loans | | — | — | — | — | | 46 | Cash and cash-related assets | | — | — | — | — | | 47 | Other categories of assets (e.g. goodwill, commodities, etc.) | | — | — | — | — | | 48 | Total GAR assets | | 70 | — | — | — | | 49 | Assets not covered for GAR calculation | | — | — | — | — | | 50 | Central governments and supranational issuers | | — | — | — | — | | 51 | Central banks exposure | | — | — | — | — | | 52 | Trading book | | — | — | — | — | | 53 | Total assets | | 70 | — | — | — | | Off-balance sheet exposures – Undertakings subject to NFRD disclosure obligations | | | | | | | | 54 | Financial guarantees | | — | — | — | — | | 55 | Assets under management | | — | — | — | — | | 56 | Of which debt securities | | — | — | — | — | | 57 | Of which equity instruments | | — | — | — | — | 371 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 1. Assets for the calculation of GAR – CapEx continued | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | Biodiversity and Ecosystems (BIO) | | | | TOTAL (CCM + CCA + WTR +CE + PPC + BIO) | | | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | Of which towards taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | Of which environmentally sustainable (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which transitional | Of which enabling | | | | | | | | | | | | — | — | — | — | 3 799 912 | 29 628 | — | 5 131 | 2 283 | | — | — | — | — | 184 933 | 25 787 | — | 2 001 | 2 102 | | — | — | — | — | 184 933 | 25 787 | — | 2 001 | 2 102 | | — | — | — | — | 184 933 | 25 787 | — | 2 001 | 2 102 | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | 16 409 | 3 841 | — | 3 130 | 181 | | — | — | — | — | 7 413 | 3 841 | — | 3 130 | 181 | | — | — | — | — | 8 996 | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | 3 598 570 | — | — | — | — | | — | — | — | — | 3 598 570 | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | 3 799 912 | 29 628 | — | 5 131 | 2 283 | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | 3 799 912 | 29 628 | — | 5 131 | 2 283 | | | | | | | | | | | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | | — | — | — | — | — | — | — | — | — | 372 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 2. GAR sector information – Turnover | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Breakdown by sector – NACE 4 digits level (code and label) | | 31 March 2025 | | | | | | | | | | | Climate Change Mitigation (CCM) | | | | Climate Change Adaptation (CCA) | | | | | | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | | | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | | | | £’000 | Of which environmentally sustainable (CCM) | £’000 | Of which environmentally sustainable (CCM) | £’000 | Of which environmentally sustainable (CCA) | £’000 | Of which environmentally sustainable (CCA) | | 1 | 41.20 | | 5 597 | 1 175 | — | — | — | — | — | — | | 2 | 64.19 | | 9 359 | — | — | — | — | — | — | — | | 3 | 71.12 | | 725 | — | — | — | — | — | — | — | | 4 | 77.35 | | 6 521 | 1 500 | — | — | — | — | — | — | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Breakdown by sector – NACE 4 digits level (code and label) | | 31 March 2025 | | | | | | | | | | | Water and marine resources (WTR) | | | | Circular Economy (CE) | | | | | | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | | | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | | | | £’000 | Of which environmentally sustainable (WTR) | £’000 | Of which environmentally sustainable (WTR) | £’000 | Of which environmentally sustainable (CE) | £’000 | Of which environmentally sustainable (CE) | | 1 | 41.20 | | — | — | — | — | — | — | — | — | | 2 | 64.19 | | — | — | — | — | — | — | — | — | | 3 | 71.12 | | — | — | — | — | — | — | — | — | | 4 | 77.35 | | — | — | — | — | — | — | — | — | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Breakdown by sector – NACE 4 digits level (code and label) | | 31 March 2025 | | | | | | | | | | | Pollution (PPC) | | | | Biodiversity and Ecosystem (BIO) | | | | | | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | | | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | | | | £’000 | Of which environmentally sustainable (PPC) | £’000 | Of which environmentally sustainable (PPC) | £’000 | Of which environmentally sustainable (BIO) | £’000 | Of which environmentally sustainable (BIO) | | 1 | 41.20 | | — | — | — | — | — | — | — | — | | 2 | 64.19 | | — | — | — | — | — | — | — | — | | 3 | 71.12 | | — | — | — | — | — | — | — | — | | 4 | 77.35 | | — | — | — | — | — | — | — | — | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | Breakdown by sector – NACE 4 digits level (code and label) | | 31 March 2025 | | | | | | | TOTAL (CCM + CCA + WTR + CE+ PPC + BIO) | | | | | | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | | | | Gross carrying amount | | Gross carrying amount | | | | | £’000 | Of which environmentally sustainable (CCM + CCA + WTR + CE+ PPC + BIO) | £’000 | Of which environmentally sustainable (CCM + CCA + WTR + CE+ PPC + BIO) | | 1 | 41.20 | | 5 597 | 1 175 | — | — | | 2 | 64.19 | | 9 359 | — | — | — | | 3 | 71.12 | | 725 | — | — | — | | 4 | 77.35 | | 6 521 | 1 500 | — | — | 373 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 2. GAR sector information – CapEx | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Breakdown by sector – NACE 4 digits level (code and label) | | 31 March 2025 | | | | | | | | | | | Climate Change Mitigation (CCM) | | | | Climate Change Adaptation (CCA) | | | | | | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | | | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | | | | £’000 | Of which environmentally sustainable (CCM) | £’000 | Of which environmentally sustainable (CCM) | £’000 | Of which environmentally sustainable (CCA) | £’000 | Of which environmentally sustainable (CCA) | | 1 | 41.20 | | 5 597 | 672 | — | — | — | — | — | — | | 2 | 64.19 | | 9 359 | — | — | — | — | — | — | — | | 3 | 71.12 | | 725 | — | — | — | — | — | — | — | | 4 | 77.35 | | 6 521 | 3 169 | — | — | — | — | — | — | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Breakdown by sector – NACE 4 digits level (code and label) | | 31 March 2025 | | | | | | | | | | | Water and marine resources (WTR) | | | | Circular Economy (CE) | | | | | | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | | | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | | | | £’000 | Of which environmentally sustainable (WTR) | £’000 | Of which environmentally sustainable (WTR) | £’000 | Of which environmentally sustainable (CE) | £’000 | Of which environmentally sustainable (CE) | | 1 | 41.20 | | — | — | — | — | — | — | — | — | | 2 | 64.19 | | — | — | — | — | — | — | — | — | | 3 | 71.12 | | — | — | — | — | — | — | — | — | | 4 | 77.35 | | — | — | — | — | — | — | — | — | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Breakdown by sector – NACE 4 digits level (code and label) | | 31 March 2025 | | | | | | | | | | | Pollution (PPC) | | | | Biodiversity and Ecosystem (BIO) | | | | | | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | | | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | Gross carrying amount | | | | | £’000 | Of which environmentally sustainable (PPC) | £’000 | Of which environmentally sustainable (PPC) | £’000 | Of which environmentally sustainable (BIO) | £’000 | Of which environmentally sustainable (BIO) | | 1 | 41.20 | | — | — | — | — | — | — | — | — | | 2 | 64.19 | | — | — | — | — | — | — | — | — | | 3 | 71.12 | | — | — | — | — | — | — | — | — | | 4 | 77.35 | | — | — | — | — | — | — | — | — | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | Breakdown by sector – NACE 4 digits level (code and label) | | 31 March 2025 | | | | | | | TOTAL (CCM + CCA + WTR + CE+ PPC + BIO) | | | | | | | Non-Financial corporates (Subject to NFRD) | | SMEs and other NFC not subject to NFRD | | | | | Gross carrying amount | | Gross carrying amount | | | | | £’000 | Of which environmentally sustainable (CCM + CCA + WTR + CE+ PPC + BIO) | £’000 | Of which environmentally sustainable (CCM + CCA + WTR + CE+ PPC + BIO) | | 1 | 41.20 | | 5 597 | 672 | — | — | | 2 | 64.19 | | 9 359 | — | — | — | | 3 | 71.12 | | 725 | — | — | — | | 4 | 77.35 | | 6 521 | 3 169 | — | — | 374 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 3. GAR KPI stock – Turnover | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | % (compared to total covered assets in the denominator) | | | 31 March 2025 | | | | | | | Climate Change Mitigation (CCM) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | | Of which use of proceeds | Of which transitional | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | | 1 | GAR Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | | 82.53% | 0.55% | —% | 0.06% | 0.04% | | 2 | Financial undertakings | | 30.42% | 3.77% | —% | 0.22% | 0.20% | | 3 | Credit institutions | | 30.42% | 3.77% | —% | 0.22% | 0.20% | | 4 | Loans and advances | | 30.42% | 3.77% | —% | 0.22% | 0.20% | | 5 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 6 | Equity instruments | | —% | —% | | —% | —% | | 7 | Other financial corporations | | —% | —% | —% | —% | —% | | 8 | of which investment firms | | —% | —% | —% | —% | —% | | 9 | Loans and advances | | —% | —% | —% | —% | —% | | 10 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 11 | Equity instruments | | —% | —% | | —% | —% | | 12 | of which management companies | | —% | —% | —% | —% | —% | | 13 | Loans and advances | | —% | —% | —% | —% | —% | | 14 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 15 | Equity instruments | | —% | —% | | —% | —% | | 16 | of which insurance undertaking | | —% | —% | —% | —% | —% | | 17 | Loans and advances | | —% | —% | —% | —% | —% | | 18 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 19 | Equity instruments | | —% | —% | | —% | —% | | 20 | Non-financial undertakings | | 38.18% | 11.74% | —% | 7.07% | 3.68% | | 21 | Loans and advances | | 71.67% | 22.08% | —% | 13.30% | 6.93% | | 22 | Debt securities, including UoP | | 0.15% | —% | —% | —% | —% | | 23 | Equity instruments | | —% | —% | | —% | —% | | 24 | Households | | 90.58% | —% | —% | —% | —% | | 25 | of which loans collateralised by residential immovable property | | 100.00% | —% | —% | —% | —% | | 26 | of which building renovation loans | | —% | —% | —% | —% | —% | | 27 | of which motor vehicle loans | | —% | —% | —% | —% | —% | | 28 | Local government financing | | —% | —% | —% | —% | —% | | 29 | Housing financing | | —% | —% | —% | —% | —% | | 30 | Other local government financing | | —% | —% | —% | —% | —% | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | | —% | —% | —% | —% | —% | | 32 | Total GAR Assets | | 16.18% | 0.11% | —% | 0.01% | 0.01% | 375 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 3. GAR KPI stock – Turnover continued | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | | | Climate Change Adaptation (CCA) | | | | Water and Marine Resources (WTR) | | | | Circular Economy (CE) | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | | | | | | | | | | | | | 0.01% | —% | —% | —% | —% | —% | —% | —% | 0.01% | —% | —% | —% | | 0.10% | —% | —% | —% | 0.01% | —% | —% | —% | 0.04% | —% | —% | —% | | 0.10% | —% | —% | —% | 0.01% | —% | —% | —% | 0.04% | —% | —% | —% | | 0.10% | —% | —% | —% | 0.01% | —% | —% | —% | 0.04% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | | | | | | | | | | | | | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | 376 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 3. GAR KPI stock – Turnover continued | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | % (compared to total covered assets in the denominator) | | 31 March 2025 | | | | | | | Pollution (PPC) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | 1 | GAR Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | | —% | —% | —% | —% | | 2 | Financial undertakings | | 0.02% | —% | —% | —% | | 3 | Credit institutions | | 0.02% | —% | —% | —% | | 4 | Loans and advances | | 0.02% | —% | —% | —% | | 5 | Debt securities, including UoP | | —% | —% | —% | —% | | 6 | Equity instruments | | —% | —% | | —% | | 7 | Other financial corporations | | —% | —% | —% | —% | | 8 | of which investment firms | | —% | —% | —% | —% | | 9 | Loans and advances | | —% | —% | —% | —% | | 10 | Debt securities, including UoP | | —% | —% | —% | —% | | 11 | Equity instruments | | —% | —% | | —% | | 12 | of which management companies | | —% | —% | —% | —% | | 13 | Loans and advances | | —% | —% | —% | —% | | 14 | Debt securities, including UoP | | —% | —% | —% | —% | | 15 | Equity instruments | | —% | —% | | —% | | 16 | of which insurance undertaking | | —% | —% | —% | —% | | 17 | Loans and advances | | —% | —% | —% | —% | | 18 | Debt securities, including UoP | | —% | —% | —% | —% | | 19 | Equity instruments | | —% | —% | | —% | | 20 | Non-financial undertakings | | —% | —% | —% | —% | | 21 | Loans and advances | | —% | —% | —% | —% | | 22 | Debt securities, including UoP | | —% | —% | —% | —% | | 23 | Equity instruments | | —% | —% | | —% | | 24 | Households | | | | | | | 25 | of which loans collateralised by residential immovable property | | | | | | | 26 | of which building renovation loans | | | | | | | 27 | of which motor vehicle loans | | | | | | | 28 | Local government financing | | —% | —% | —% | —% | | 29 | Housing financing | | —% | —% | —% | —% | | 30 | Other local government financing | | —% | —% | —% | —% | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | | —% | —% | —% | —% | | 32 | Total GAR Assets | | —% | —% | —% | —% | 377 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 3. GAR KPI stock – Turnover continued | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | Biodiversity and Ecosystem (BIO) | | | | TOTAL (CCM + CCA + WTR + CE + PPC + BIO) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | Proportion of total assets covered | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which transitional | Of which enabling | | | | | | | | | | | | | —% | —% | —% | —% | 82.56% | 0.55% | —% | 0.06% | 0.04% | 14.77% | | —% | —% | —% | —% | 30.60% | 3.77% | —% | 0.22% | 0.20% | 1.91% | | —% | —% | —% | —% | 30.60% | 3.77% | —% | 0.22% | 0.20% | 1.91% | | —% | —% | —% | —% | 30.60% | 3.77% | —% | 0.22% | 0.20% | 1.91% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | —% | —% | —% | 38.18% | 11.74% | —% | 7.07% | 3.68% | 0.07% | | —% | —% | —% | —% | 71.67% | 22.08% | —% | 13.30% | 6.93% | 0.04% | | —% | —% | —% | —% | 0.15% | —% | —% | —% | —% | 0.03% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | | | | | 90.58% | —% | —% | —% | —% | 12.78% | | | | | | 100.00% | —% | —% | —% | —% | 11.58% | | | | | | | —% | —% | —% | —% | —% | | | | | | | | | | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | 16.18% | 0.11% | —% | 0.01% | 0.01% | 75.33% | 378 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 3. GAR KPI stock – CapEx | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | % (compared to total covered assets in the denominator) | | | 31 March 2025 | | | | | | | Climate Change Mitigation (CCM) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | | Of which use of proceeds | Of which transitional | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | | 1 | GAR Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | | 82.77% | 0.65% | —% | 0.11% | 0.05% | | 2 | Financial undertakings | | 30.93% | 4.34% | —% | 0.34% | 0.35% | | 3 | Credit institutions | | 30.93% | 4.34% | —% | 0.34% | 0.35% | | 4 | Loans and advances | | 30.93% | 4.34% | —% | 0.34% | 0.35% | | 5 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 6 | Equity instruments | | —% | —% | | —% | —% | | 7 | Other financial corporations | | —% | —% | —% | —% | —% | | 8 | of which investment firms | | —% | —% | —% | —% | —% | | 9 | Loans and advances | | —% | —% | —% | —% | —% | | 10 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 11 | Equity instruments | | —% | —% | | —% | —% | | 12 | of which management companies | | —% | —% | —% | —% | —% | | 13 | Loans and advances | | —% | —% | —% | —% | —% | | 14 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 15 | Equity instruments | | —% | —% | | —% | —% | | 16 | of which insurance undertaking | | —% | —% | —% | —% | —% | | 17 | Loans and advances | | —% | —% | —% | —% | —% | | 18 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 19 | Equity instruments | | —% | —% | | —% | —% | | 20 | Non-financial undertakings | | 71.96% | 16.85% | —% | 13.74% | 0.79% | | 21 | Loans and advances | | 61.12% | 31.70% | —% | 25.83% | 1.49% | | 22 | Debt securities, including UoP | | 84.26% | —% | —% | —% | —% | | 23 | Equity instruments | | —% | —% | | —% | —% | | 24 | Households | | 90.58% | —% | —% | —% | —% | | 25 | of which loans collateralised by residential immovable property | | 100.00% | —% | —% | —% | —% | | 26 | of which building renovation loans | | —% | —% | —% | —% | —% | | 27 | of which motor vehicle loans | | —% | —% | —% | —% | —% | | 28 | Local government financing | | —% | —% | —% | —% | —% | | 29 | Housing financing | | —% | —% | —% | —% | —% | | 30 | Other local government financing | | —% | —% | —% | —% | —% | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | | —% | —% | —% | —% | —% | | 32 | Total GAR Assets | | 16.32% | 0.13% | —% | 0.02% | 0.01% | 379 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 3. GAR KPI stock – CapEx continued | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | | | Climate Change Adaptation (CCA) | | | | Water and Marine Resources (WTR) | | | | Circular Economy (CE) | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | | | | | | | | | | | | | 0.02% | —% | —% | —% | —% | —% | —% | —% | 0.01% | —% | —% | —% | | 0.13% | —% | —% | —% | 0.02% | —% | —% | —% | 0.05% | —% | —% | —% | | 0.13% | —% | —% | —% | 0.02% | —% | —% | —% | 0.05% | —% | —% | —% | | 0.13% | —% | —% | —% | 0.02% | —% | —% | —% | 0.05% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | 0.05% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | 0.05% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | 0.05% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | | | | | | | | | | | | | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | 380 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 3. GAR KPI stock – CapEx continued | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | % (compared to total covered assets in the denominator) | | 31 March 2025 | | | | | | | Pollution (PPC) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | 1 | GAR Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | | —% | —% | —% | —% | | 2 | Financial undertakings | | 0.01% | —% | —% | —% | | 3 | Credit institutions | | 0.01% | —% | —% | —% | | 4 | Loans and advances | | 0.01% | —% | —% | —% | | 5 | Debt securities, including UoP | | —% | —% | —% | —% | | 6 | Equity instruments | | —% | —% | | —% | | 7 | Other financial corporations | | —% | —% | —% | —% | | 8 | of which investment firms | | —% | —% | —% | —% | | 9 | Loans and advances | | —% | —% | —% | —% | | 10 | Debt securities, including UoP | | —% | —% | —% | —% | | 11 | Equity instruments | | —% | —% | | —% | | 12 | of which management companies | | —% | —% | —% | —% | | 13 | Loans and advances | | —% | —% | —% | —% | | 14 | Debt securities, including UoP | | —% | —% | —% | —% | | 15 | Equity instruments | | —% | —% | | —% | | 16 | of which insurance undertaking | | —% | —% | —% | —% | | 17 | Loans and advances | | —% | —% | —% | —% | | 18 | Debt securities, including UoP | | —% | —% | —% | —% | | 19 | Equity instruments | | —% | —% | | —% | | 20 | Non-financial undertakings | | —% | —% | —% | —% | | 21 | Loans and advances | | —% | —% | —% | —% | | 22 | Debt securities, including UoP | | —% | —% | —% | —% | | 23 | Equity instruments | | —% | —% | | —% | | 24 | Households | | | | | | | 25 | of which loans collateralised by residential immovable property | | | | | | | 26 | of which building renovation loans | | | | | | | 27 | of which motor vehicle loans | | | | | | | 28 | Local government financing | | —% | —% | —% | —% | | 29 | Housing financing | | —% | —% | —% | —% | | 30 | Other local government financing | | —% | —% | —% | —% | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | | —% | —% | —% | —% | | 32 | Total GAR Assets | | —% | —% | —% | —% | 381 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 3. GAR KPI stock – CapEx continued | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | Biodiversity and Ecosystem (BIO) | | | | TOTAL (CCM + CCA + WTR + CE + PPC + BIO) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | Proportion of total assets covered | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which transitional | Of which enabling | | | | | | | | | | | | | —% | —% | —% | —% | 82.79% | 0.65% | —% | 0.11% | 0.05% | 14.77% | | —% | —% | —% | —% | 31.14% | 4.34% | —% | 0.34% | 0.35% | 1.91% | | —% | —% | —% | —% | 31.14% | 4.34% | —% | 0.34% | 0.35% | 1.91% | | —% | —% | —% | —% | 31.14% | 4.34% | —% | 0.34% | 0.35% | 1.91% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | —% | —% | —% | 72.01% | 16.85% | —% | 13.74% | 0.79% | 0.07% | | —% | —% | —% | —% | 61.18% | 31.70% | —% | 25.83% | 1.49% | 0.04% | | —% | —% | —% | —% | 84.31% | —% | —% | —% | —% | 0.03% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | | | | | 90.58% | —% | —% | —% | —% | 12.78% | | | | | | 100.00% | —% | —% | —% | —% | 11.58% | | | | | | —% | —% | —% | —% | —% | —% | | | | | | | | | | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | 16.23% | 0.13% | —% | 0.02% | 0.01% | 75.33% | 382 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 4. GAR KPI flow – Turnover | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | % (compared to flow of total eligible assets) | | | 31 March 2025 | | | | | | | Climate Change Mitigation (CCM) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | | Of which use of proceeds | Of which transitional | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | | 1 | GAR Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | | 60.91% | 0.14% | —% | 0.03% | —% | | 2 | Financial undertakings | | 34.00% | 3.00% | —% | 0.70% | 0.10% | | 3 | Credit institutions | | 34.00% | 3.00% | —% | 0.70% | 0.10% | | 4 | Loans and advances | | 34.00% | 3.00% | —% | 0.70% | 0.10% | | 5 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 6 | Equity instruments | | —% | —% | | —% | —% | | 7 | Other financial corporations | | —% | —% | —% | —% | —% | | 8 | of which investment firms | | —% | —% | —% | —% | —% | | 9 | Loans and advances | | —% | —% | —% | —% | —% | | 10 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 11 | Equity instruments | | —% | —% | | —% | —% | | 12 | of which management companies | | —% | —% | —% | —% | —% | | 13 | Loans and advances | | —% | —% | —% | —% | —% | | 14 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 15 | Equity instruments | | —% | —% | | —% | —% | | 16 | of which insurance undertaking | | —% | —% | —% | —% | —% | | 17 | Loans and advances | | —% | —% | —% | —% | —% | | 18 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 19 | Equity instruments | | —% | —% | | —% | —% | | 20 | Non-financial undertakings | | 0.16% | —% | —% | —% | —% | | 21 | Loans and advances | | —% | —% | —% | —% | —% | | 22 | Debt securities, including UoP | | 0.16% | —% | —% | —% | —% | | 23 | Equity instruments | | —% | —% | | —% | —% | | 24 | Households | | 62.86% | —% | —% | —% | —% | | 25 | of which loans collateralised by residential immovable property | | 100.00% | —% | —% | —% | —% | | 26 | of which building renovation loans | | —% | —% | —% | —% | —% | | 27 | of which motor vehicle loans | | —% | —% | —% | —% | —% | | 28 | Local government financing | | —% | —% | —% | —% | —% | | 29 | Housing financing | | —% | —% | —% | —% | —% | | 30 | Other local government financing | | —% | —% | —% | —% | —% | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | | —% | —% | —% | —% | —% | | 32 | Total GAR Assets | | 26.70% | 0.06% | —% | 0.01% | —% | 383 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 4. GAR KPI flow – Turnover continued | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | | | Climate Change Adaptation (CCA) | | | | Water and Marine Resources (WTR) | | | | Circular Economy (CE) | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | | | | | | | | | | | | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | | | | | | | | | | | | | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | 384 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 4. GAR KPI flow – Turnover continued | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | % (compared to flow of total eligible assets) | | 31 March 2025 | | | | | | | Pollution (PPC) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | 1 | GAR Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | | —% | —% | —% | —% | | 2 | Financial undertakings | | —% | —% | —% | —% | | 3 | Credit institutions | | —% | —% | —% | —% | | 4 | Loans and advances | | —% | —% | —% | —% | | 5 | Debt securities, including UoP | | —% | —% | —% | —% | | 6 | Equity instruments | | —% | —% | | —% | | 7 | Other financial corporations | | —% | —% | —% | —% | | 8 | of which investment firms | | —% | —% | —% | —% | | 9 | Loans and advances | | —% | —% | —% | —% | | 10 | Debt securities, including UoP | | —% | —% | —% | —% | | 11 | Equity instruments | | —% | —% | | —% | | 12 | of which management companies | | —% | —% | —% | —% | | 13 | Loans and advances | | —% | —% | —% | —% | | 14 | Debt securities, including UoP | | —% | —% | —% | —% | | 15 | Equity instruments | | —% | —% | | —% | | 16 | of which insurance undertaking | | —% | —% | —% | —% | | 17 | Loans and advances | | —% | —% | —% | —% | | 18 | Debt securities, including UoP | | —% | —% | —% | —% | | 19 | Equity instruments | | —% | —% | | —% | | 20 | Non-financial undertakings | | —% | —% | —% | —% | | 21 | Loans and advances | | —% | —% | —% | —% | | 22 | Debt securities, including UoP | | —% | —% | —% | —% | | 23 | Equity instruments | | —% | —% | | —% | | 24 | Households | | | | | | | 25 | of which loans collateralised by residential immovable property | | | | | | | 26 | of which building renovation loans | | | | | | | 27 | of which motor vehicle loans | | | | | | | 28 | Local government financing | | —% | —% | —% | —% | | 29 | Housing financing | | —% | —% | —% | —% | | 30 | Other local government financing | | —% | —% | —% | —% | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | | —% | —% | —% | —% | | 32 | Total GAR Assets | | —% | —% | —% | —% | 385 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 4. GAR KPI flow – Turnover continued | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | Biodiversity and Ecosystem (BIO) | | | | TOTAL (CCM + CCA + WTR + CE + PPC + BIO) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | Proportion of total assets covered | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which transitional | Of which enabling | | | | | | | | | | | | | —% | —% | —% | —% | 60.91% | 0.14% | —% | 0.03% | —% | 56.78% | | —% | —% | —% | —% | 34.00% | 3.00% | —% | 0.70% | 0.10% | 15.39% | | —% | —% | —% | —% | 34.00% | 3.00% | —% | 0.70% | 0.10% | 3.57% | | —% | —% | —% | —% | 34.00% | 3.00% | —% | 0.70% | 0.10% | 2.06% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 1.50% | | —% | —% | | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 11.83% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 9.47% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 9.17% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 0.30% | | —% | —% | | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 1.13% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 1.08% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 0.05% | | —% | —% | | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | 0.16% | —% | —% | —% | —% | 0.03% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | 0.16% | —% | —% | —% | —% | 0.03% | | —% | —% | | —% | —% | —% | —% | —% | —% | —% | | | | | | 62.86% | —% | —% | —% | —% | 0.18% | | | | | | 100.00% | —% | —% | —% | —% | 0.17% | | | | | | | —% | —% | —% | —% | —% | | | | | | | | | | | | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | 26.70% | 6.00% | —% | 1.00% | —% | 100.00% | 386 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 4. GAR KPI flow – CapEx | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | % (compared to flow of total eligible assets) | | | 31 March 2025 | | | | | | | Climate Change Mitigation (CCM) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | | Of which use of proceeds | Of which transitional | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | | 1 | GAR Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | | 61.76% | 0.16% | —% | 0.03% | 0.01% | | 2 | Financial undertakings | | 34.20% | 3.30% | —% | 0.70% | 0.02% | | 3 | Credit institutions | | 34.20% | 3.30% | —% | 0.70% | 0.02% | | 4 | Loans and advances | | 34.20% | 3.30% | —% | 0.70% | 0.02% | | 5 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 6 | Equity instruments | | —% | —% | | —% | —% | | 7 | Other financial corporations | | —% | —% | —% | —% | —% | | 8 | of which investment firms | | —% | —% | —% | —% | —% | | 9 | Loans and advances | | —% | —% | —% | —% | —% | | 10 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 11 | Equity instruments | | —% | —% | | —% | —% | | 12 | of which management companies | | —% | —% | —% | —% | —% | | 13 | Loans and advances | | —% | —% | —% | —% | —% | | 14 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 15 | Equity instruments | | —% | —% | | —% | —% | | 16 | of which insurance undertaking | | —% | —% | —% | —% | —% | | 17 | Loans and advances | | —% | —% | —% | —% | —% | | 18 | Debt securities, including UoP | | —% | —% | —% | —% | —% | | 19 | Equity instruments | | —% | —% | | —% | —% | | 20 | Non-financial undertakings | | 89.16% | —% | —% | —% | —% | | 21 | Loans and advances | | —% | —% | —% | —% | —% | | 22 | Debt securities, including UoP | | 89.16% | —% | —% | —% | —% | | 23 | Equity instruments | | —% | —% | | —% | —% | | 24 | Households | | 62.86% | —% | —% | —% | —% | | 25 | of which loans collateralised by residential immovable property | | 100.00% | —% | —% | —% | —% | | 26 | of which building renovation loans | | —% | —% | —% | —% | —% | | 27 | of which motor vehicle loans | | —% | —% | —% | —% | —% | | 28 | Local government financing | | —% | —% | —% | —% | —% | | 29 | Housing financing | | —% | —% | —% | —% | —% | | 30 | Other local government financing | | —% | —% | —% | —% | —% | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | | —% | —% | —% | —% | —% | | 32 | Total GAR Assets | | 27.07% | 0.07% | —% | 0.01% | —% | 387 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 4. GAR KPI flow – CapEx continued | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | | | Climate Change Adaptation (CCA) | | | | Water and Marine Resources (WTR) | | | | Circular Economy (CE) | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | | | | | | | | | | | | | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | 0.06% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | 0.06% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | | —% | —% | —% | | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | —% | —% | —% | —% | | | | | —% | —% | —% | —% | | | | | | | | | | | | | | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | 388 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 4. GAR KPI flow – CapEx continued | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | % (compared to flow of total eligible assets) | | 31 March 2025 | | | | | | | Pollution (PPC) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | GAR – Covered assets in both numerator and denominator | | | | | | | 1 | GAR Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation | | —% | —% | —% | —% | | 2 | Financial undertakings | | —% | —% | —% | —% | | 3 | Credit institutions | | —% | —% | —% | —% | | 4 | Loans and advances | | —% | —% | —% | —% | | 5 | Debt securities, including UoP | | —% | —% | —% | —% | | 6 | Equity instruments | | —% | —% | | —% | | 7 | Other financial corporations | | —% | —% | —% | —% | | 8 | of which investment firms | | —% | —% | —% | —% | | 9 | Loans and advances | | —% | —% | —% | —% | | 10 | Debt securities, including UoP | | —% | —% | —% | —% | | 11 | Equity instruments | | —% | —% | | —% | | 12 | of which management companies | | —% | —% | —% | —% | | 13 | Loans and advances | | —% | —% | —% | —% | | 14 | Debt securities, including UoP | | —% | —% | —% | —% | | 15 | Equity instruments | | —% | —% | | —% | | 16 | of which insurance undertaking | | —% | —% | —% | —% | | 17 | Loans and advances | | —% | —% | —% | —% | | 18 | Debt securities, including UoP | | —% | —% | —% | —% | | 19 | Equity instruments | | —% | —% | | —% | | 20 | Non-financial undertakings | | —% | —% | —% | —% | | 21 | Loans and advances | | —% | —% | —% | —% | | 22 | Debt securities, including UoP | | —% | —% | —% | —% | | 23 | Equity instruments | | —% | —% | | —% | | 24 | Households | | | | | | | 25 | of which loans collateralised by residential immovable property | | | | | | | 26 | of which building renovation loans | | | | | | | 27 | of which motor vehicle loans | | | | | | | 28 | Local government financing | | —% | —% | —% | —% | | 29 | Housing financing | | —% | —% | —% | —% | | 30 | Other local government financing | | —% | —% | —% | —% | | 31 | Collateral obtained by taking possession: residential and commercial immovable properties | | —% | —% | —% | —% | | 32 | Total GAR Assets | | —% | —% | —% | —% | 389 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 4. GAR KPI flow – CapEx continued | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | 31 March 2025 | | | | | | | | | | | Biodiversity and Ecosystem (BIO) | | | | TOTAL (CCM + CCA + WTR + CE + PPC + BIO) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | Proportion of total assets covered | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which transitional | Of which enabling | | | | | | | | | | | | | —% | —% | —% | —% | 61.76% | 0.16% | —% | 0.03% | 0.01% | 56.78% | | —% | —% | —% | —% | 34.20% | 3.30% | —% | 0.70% | 0.20% | 15.39% | | —% | —% | —% | —% | 34.20% | 3.30% | —% | 0.70% | 0.20% | 3.57% | | —% | —% | —% | —% | 34.20% | 3.30% | —% | 0.70% | 0.20% | 2.06% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 1.50% | | —% | —% | | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 11.83% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 9.47% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 9.17% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 0.30% | | —% | —% | | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 1.13% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 1.08% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | 0.05% | | —% | —% | | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | 89.21% | —% | —% | —% | —% | 0.03% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | 89.21% | —% | —% | —% | —% | 0.03% | | —% | —% | | —% | —% | —% | —% | —% | —% | —% | | | | | | 62.86% | —% | —% | —% | —% | 0.18% | | | | | | 100.00% | —% | —% | —% | —% | 0.17% | | | | | | | —% | —% | —% | —% | —% | | | | | | | | | | | | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | —% | —% | —% | —% | —% | —% | | —% | —% | —% | —% | 26.70% | 0.07% | —% | 0.01% | —% | 100.00% | 390 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 5. KPI off-balance sheet exposures | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | % (compared to total eligible off-balance sheet assets) | | 31 March 2025 | | | | | | | | | | Climate Change Mitigation (CCM) | | | | | Climate Change Adaptation (CCA) | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | Of which use of proceeds | Of which transitional | Of which enabling | | | Of which use of proceeds | Of which enabling | | 1 | Financial guarantees (FinGuar KPI) | — | — | — | — | — | — | — | — | — | | 2 | Assets under management (AuM KPI) | — | — | — | — | — | — | — | — | — | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | % (compared to total eligible off-balance sheet assets) | | 31 March 2025 | | | | | | | | | | | Water and Marine Resources (WTR) | | | | Circular Economy (CE) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | 1 | Financial guarantees (FinGuar KPI) | | — | — | — | — | — | — | — | — | | 2 | Assets under management (AuM KPI) | | — | — | — | — | — | — | — | — | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | % (compared to total eligible off-balance sheet assets) | | 31 March 2025 | | | | | | | | | | | Pollution (PPC) | | | | Biodiversity and Ecosystem (BIO) | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | Of which use of proceeds | Of which enabling | | | Of which use of proceeds | Of which enabling | | 1 | Financial guarantees (FinGuar KPI) | | — | — | — | — | — | — | — | — | | 2 | Assets under management (AuM KPI) | | — | — | — | — | — | — | — | — | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | % (compared to total eligible off-balance sheet assets) | | 31 March 2025 | | | | | | | | TOTAL (CCM + CCA + WTR + CE + PPC + BIO) | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) | | | | | | | | Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned) | | | | | | | | Of which use of proceeds | Of which transitional | Of which enabling | | 1 | Financial guarantees (FinGuar KPI) | | — | — | — | — | — | | 2 | Assets under management (AuM KPI) | | — | — | — | — | — | 391 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 05 | | Annual financial statements | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ANNEXURES CONTINUED | | | | | | 6. Nuclear and fossil gas related activities – Turnover and CapEx based | | | | | --- | --- | --- | | | | | | Row | Nuclear energy related activities | | | 1 | The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle. | No | | 2 | The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best available technologies. | No | | 3 | The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgrades. | No | | | Fossil gas related activities | | | 4 | The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels. | No | | 5 | The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels. | No | | 6 | The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels. | No | 392 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | ALTERNATIVE PERFORMANCE MEASURES | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | ALTERNATIVE PERFORMANCE MEASURES | | | | | | | | | | --- | --- | | | | | Alternative_performance_measures.svg | We supplement our IFRS figures with alternative performance measures used by management internally and which provide valuable, relevant information to readers. These measures are used to align internal and external reporting, identify items management believes are not representative of the underlying performance of the business and provide insight into how management assesses period-on-period performance. A description of the Group’s alternative performance measures and their calculation, where relevant, is set out below. | | Alternative performance measures are not measures within the scope of IFRS and are not a substitute for IFRS financial measures. Alternative performance measures constitute pro-forma financial information. The pro-forma financial information is the responsibility of the Board of Directors and is presented for illustrative purposes only and because of its nature may not fairly present the Group’s financial position, changes in equity, and results in operations or cash flows. The below information is audited unless indicated otherwise. | | | | | | --- | --- | --- | | | | | | Adjusted earnings attributable to ordinary shareholders | Earnings attributable to shareholders adjusted to remove goodwill, acquired intangibles, strategic actions, including such items within equity-accounted earnings, and earnings attributable to perpetual preference shareholders and Other Additional Tier 1 security holders. | | | Adjusted operating profit | Pro-forma profit before taxation, adjusted to remove goodwill, acquired intangibles and strategic actions, including such items within equity-accounted earnings, and non-controlling interests | | | | Page_references.svg | Refer to calculation on page [143](#i447e4d363cd344738300acdd42f0e3a0_286) for a reconciliation of these items. | | Annuity income | Net interest income plus net annuity fees and commissions | | | | Page_references.svg | Refer to page [146](#i447e4d363cd344738300acdd42f0e3a0_289) and [147](#i447e4d363cd344738300acdd42f0e3a0_292) | | Core loans | The table below describes the differences between ‘loans and advances to customers’ as per the balance sheet and gross core loans. | | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’million | 31 March 2025 | | 31 March 2024 | | | Loans and advances to customers per the balance sheet | 16 814 | | 16 570 | | | ECL held against FVOCI loans | (23) | | (13) | | | Net core loans | 16 791 | | 16 557 | | | of which amortised cost and FVOCI (‘subject to ECL’) | 16 219 | | 15 916 | | | of which FVPL | 572 | | 641 | | | Add: ECL | 165 | | 187 | | | Gross core loans | 16 956 | | 16 744 | | | of which amortised cost and FVOCI (‘subject to ECL’) | 16 384 | | 16 103 | | | of which FVPL | 572 | | 641 | | | | | | --- | --- | | | | | Cost to income ratio | Refer to calculation in the table below for the Group | | | | | | | | --- | --- | --- | --- | --- | | | | | | | | £’000 | 31 March 2025 | | 31 March 2024 | | | Operating costs (A) | 597 719 | | 626 732 | | | Operating income | 1 191 594 | | 1 194 305 | | | Less: Profit attributable to non-controlling interests | (12) | | (1 204) | | | Total (B) | 1 191 582 | | 1 193 101 | | | Cost to income ratio (A/B)^ | 50.2% | | 52.5% | | ^ This key metric is based on the pro-forma income statements on page [27](#i447e4d363cd344738300acdd42f0e3a0_112). The below information is unaudited | | | | | --- | --- | --- | | | | | | Coverage ratio | ECL as a percentage of gross core loans subject to ECL | | | Credit loss ratio | ECL impairment charges on core loans as a percentage of average gross core loans subject to ECL | | | Gearing ratio | Total assets divided by total equity | | | Loans and advances to customers as a % of customer deposits | Loans and advances to customers as a percentage of customer accounts (deposits) | | | Net interest margin | Interest income net of interest expense, divided by average interest-earning assets | | | Page_references.svg | Refer to calculation on page [146](#i447e4d363cd344738300acdd42f0e3a0_289) . | | Return on average assets | Adjusted earnings attributable to ordinary shareholders divided by average total assets excluding assurance assets | | | Return on risk weighted assets | Adjusted earnings attributable to ordinary shareholders divided by average risk weighted assets | | 393 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | DEFINITIONS | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | DEFINITIONS | | | | | | Cash and near cash Comprises cash, near cash (which largely includes central bank prepositioned collateral), and central bank cash placements and other HQLA ECL Expected credit loss Funds under management Consists of third-party funds managed by the Wealth & Investment business, and by the Property business (which forms part of the Specialist Bank) in the prior year FVOCI Fair value through other comprehensive income FVPL Fair value through profit and loss Interest-earning assets Cash and near cash, bank debt securities, sovereign debt securities, loans and advances, other debt securities, other loans and advances and lease receivables. | | | | --- | --- | | | | | | Refer to page [146](#i447e4d363cd344738300acdd42f0e3a0_289) for the calculation. | Interest-bearing liabilities Deposits by banks, debt securities in issue, repurchase agreements and cash collateral on securities lent, customer accounts (deposits), subordinated liabilities, and lease liabilities. | | | | --- | --- | | | | | | Refer to page [146](#i447e4d363cd344738300acdd42f0e3a0_289) the for calculation. | Legacy business in the UK Specialist Bank (‘Legacy’) Legacy, as separately disclosed from 2014 to 2018, comprises pre-2008 assets held on the UK bank’s balance sheet, that had very low/negative margins and assets relating to business we are no longer undertaking Net zero Balancing the amount of emitted greenhouse gases with equivalent emissions that are either offset or sequestered Ongoing basis Ongoing information, as separately disclosed from 2014 to 2018, excludes Legacy assets (refer to definition), as well as the following businesses sold in previous years: Investec Bank (Australia) Limited, Kensington Group plc and Start Mortgage Holdings Limited Strategic actions Comprises the closure and rundown of the Hong Kong direct investments business and financial impact of Group restructures Structured credit Reflects the gross exposure of rated and unrated structured credit classified within other debt securities and other loans and advances on the balance sheet. | | | | --- | --- | | | | | | Refer to page [273](#i447e4d363cd344738300acdd42f0e3a0_511) for detail. | Subject to ECL Includes financial assets held at amortised cost and FVOCI 394 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | GLOSSARY | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | GLOSSARY | | | | | | A2XA2X Markets stock exchange (South Africa) ABCAnti-bribery and corruption AGMAnnual general meeting AIArtificial intelligence ALCOAsset and Liability Committee AMLAnti-money laundering APPAuthorised Push Payment AT1 Additional Tier 1 BCBSBasel Committee of Banking Supervision BCRBanking Competition Remedies Limited BIDBelonging, inclusion and diversity BoE Bank of England BREEAMBuilding Research Establishment Environmental Assessment Methodology BRCC Board Risk and Capital Committee BRRD Bank Recovery and Resolution Directive CAChartered Accountant CBES21Climate Biennial Exploratory Scenario CCGTCombined cycle gas turbine CCRCounterparty credit risk CCyBCountercyclical capital buffer CEO Chief Executive CET1Common Equity Tier 1 CFP Contingency Funding Plan COOChief Operating Officer COVID Corona Virus Disease CPI Consumer Price Index CRD IV Capital Requirements Directive IV CRD V Capital Requirements Directive V CROChief Risk Officer CRR Capital Requirements Regulation CSRDCorporate Sustainability Reporting Directive CVACredit valuation adjustment DCFDiscounted cash flow DLC Dual listed company DLC BRCCDLC Board Risk and Capital Committee DLC ESCDLC Executive Sustainability Committee DLC ITRGCDLC IT Risk and Governance Committee DLC SECDLC Social and Ethics Committee DMADouble materiality assessment DNSHDo No Significant Harm EADExposure at default EBAEuropean Banking Authority EBRDEuropean Bank for Reconstruction and Development ECEuropean Commission ECL Expected credit loss EfWEnergy-from-waste EIREffective interest rate EPEquator Principles EPCEnergy performance certificate ESExpected shortfall ESG Environmental, social and governance ESRSEuropean Sustainability Reporting Standards EU European Union EVElectric vehicle EVA Economic Value Added EVTExtreme value theory FCAFinancial Conduct Authority FPCFinancial Policy Committee FRCFinancial Reporting Council FSCSFinancial Services Compensation Scheme FUMFunds under management FUMAFunds under management and administration FVOCIFair value through other comprehensive income FVPLFair value through profit and loss GDP Gross domestic product GDPRGeneral data protection regulation Group ERC Group Executive Risk Committee GFSC Guernsey Financial Services Commission GHGGreenhouse gas GMRA Global Master Repurchase Agreement GMSLA Global Master Securities Lending Agreement HNWHigh net worth HQLA High quality liquid assets IAMInvestec Asset Management Limited IASsInternational Accounting Standards IBLInvestec Bank Limited IBSImportant Business Service IBOR Interbank offered rate IBPInvestec Bank plc IBP BRCCIBP Board Risk and Capital Committee IBP ERCIBP Executive Risk Committee IBP PDMRsIBP Persons Discharging Managerial Responsibilities IBP Review ERRFIBP Review Executive Risk Review Forum IBP SBFIBP Sustainable Business Forum ICAAPInternal Capital Adequacy Assessment Process IFCInternational Finance Corporation IFRSInternational Financial Reporting Standard ILAAPInternal Liquidity Adequacy Assessment Process IRBInternal Ratings Based IROsImpacts, risks and opportunities IRRBBInterest Rate Risk in the Banking Book ISDA International Swaps and Derivatives Association ITInformation technology IW&I UKInvestec Wealth & Investment Limited IW&IIInvestec Wealth & Investment International Group JSEJohannesburg Stock Exchange LCRLiquidity Coverage ratio LGDLoss given default LHSLeft-hand side LIBOR London Inter-bank Offered Rate LSELondon Stock Exchange LTIPLong-term incentive plan LTVLoan-to-value MLROMoney Laundering Reporting Officer 395 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | GLOSSARY | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | GLOSSARY CONTINUED | | | | | | MRELMinimum Requirements for Own Funds and Eligible Liabilities MRMModel Risk Management MRTMaterial Risk Taker NACENomenclature of Economic Activities in the European Community NCINon-controlling interests NEDNon-Executive Director NSFRNet Stable Funding ratio NSXNamibian Stock Exchange NZBANet-Zero Banking Alliance OECDOrganisation for Economic Co-operation and Development OTC Over the counter P&OPeople and Organisation PBAFPartnership for Biodiversity Accounting Financials PCAF Partnership for Carbon Accounting Financials PD Probability of default PDMRPersons Discharging Managerial Responsibilities PRAPrudential Regulation Authority PRISMProbability Risk and Impact System PSRPayment Systems Regulator R&CFRisk and Control Forum RAFResolvability Assessment Framework RHSRight-hand side ROURight-of-use asset RWARisk weighted asset RFRRisk-free rate SAFSustainable aviation fuel SBTi Science Based Targets initiative SDGsSustainable Development Goals SICRSignificant increase in credit risk SMCRSenior Management and Certification Regime SME Small and Medium-sized Enterprises SMFSenior management function SPPISolely payments of principal and interest SREPSupervisory Review and Evaluation Process sVaRStressed VaR TCFDTask Force on Climate-related Financial Disclosures TFSMEBank of England Term Funding Scheme for Small and Medium Enterprises TCSTechnical Screening Criteria UNUnited Nations UN SDGsUnited Nations Sustainable Development Goals UK United Kingdom USAUnited States of America VaR Value at Risk VRVariable Remuneration W&IWealth & Investment 396 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | CREDIT RATINGS | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CREDIT RATINGS | | | | | | In terms of our DLC structure, creditors are ring-fenced to either Investec Limited or Investec plc as there are no cross- guarantees between the companies. Capital and liquidity are prohibited from flowing between the two entities and thus capital and liquidity are not fungible. As a result, the rating agencies have assigned separate ratings to the significant banking entities within the Investec group, namely IBP and Investec Bank Limited (IBL). Certain rating agencies have also assigned ratings to the holding companies, namely, Investec plc and Investec Limited. On 23 August 2024, Moody's affirmed IBP's long-term deposit rating at A1 and Investec plc’s rating at Baa1. The outlook for Investec plc was changed to positive from stable. IBP’s rating outlook was affirmed as stable. On 20 September 2024, Fitch upgraded IBP’s long-term Issuer Default Rating (IDR) from BBB+ (stable outlook) to A- (stable outlook). Our ratings at 19 June 2025 were as follows: | | | | | --- | --- | --- | | | | | | Rating agency | Investec plc | IBP A subsidiary of Investec plc | | Fitch | | | | Long-term ratings | | A- | | Short-term ratings | | F2 | | Outlook | | Stable | | Moody’s | | | | Long-term ratings | Baa1 | A1 | | Short-term ratings | P-2 | P-1 | | Outlook | Positive | Stable | | | | | --- | --- | | | | | | [Further information on Investec's credit ratings may be](https://www.investec.com/en_za/welcome-to-investec/about-us/investor-relations/investor-centre.html) [found on our website.](https://www.investec.com/en_za/welcome-to-investec/about-us/investor-relations/investor-centre.html) | 397 | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | CORPORATE INFORMATION | | | Investec Bank plc Annual Financial Statements 2025 | | | | | | | | | CORPORATE INFORMATION | | | | | | #### Investec Bank plc Secretary and registered office David Miller 30 Gresham Street London EC2V 7QP United Kingdom Telephone(44) 20 7597 4000 Website www.investec.com Registration number Registered in England Registration number 489604 Auditors Deloitte LLP Directors as at 19 June 2025 Executive Directors Ruth Leas Kevin McKenna Fani Titi Marlé van der Walt Non-Executive Directors Vivek Ahuja Henrietta Baldock David Germain John Reizenstein Paul Seward Lesley Watkins | | | | --- | --- | | | | | For queries regarding information in this document | | | Investor Relations | | | Telephone | (44) 20 7597 5504 | | Email | | | Website | www.investec.com/en\_gb/welcome-to-investec/about-us/ investor-relations.html | ![]() | | | | | --- | --- | --- | | | | | | investec.com | | Studio 5 imprint.png | #### Independent auditor’s reasonable Assurance Report to the Members of Investec Bank #### plc on the compliance of the Electronic Format Annual Financial Report with Financial #### Conduct #### Authority #### (FCA) #### Disclosure #### Guidance and #### Transparency #### Rule #### (DTR) #### 4.1.15R-DTR 4.1.18R #### Report on #### compliance #### with the #### requirements for #### iXBRL mark up (‘tagging’) of #### consolidated #### financial #### statements included in the Electronic Format Annual Financial Report #### We have undertaken a reasonable assurance engagement on the iXBRL mark up of consolidated #### financial #### statements for the #### year #### ended 31 #### March 2025 of #### Investec #### Bank #### plc (the #### “company”) included #### in the Electronic Format Annual Financial Report prepared by the company. #### Our #### assurance #### conclusion #### Based on #### our #### procedures #### described in #### this report, and #### evidence we #### have obtained, in #### our opinion, the consolidated financial statements for the year ended 31 March 2025 of the company included in the #### Electronic #### Format #### Annual #### Financial Report, #### are #### marked up, in #### all #### material respects, in #### compliance #### with #### DTR 4.1.15R-DTR 4.1.18R. #### Scope of #### our #### work #### Investec #### Bank #### plc #### has #### engaged us to #### conduct an #### independent #### reasonable #### assurance #### engagement in #### accordance with International Standard on Assurance Engagements (UK) 3000, Assurance #### Engagements #### Other t|han #### Audits #### or Reviews #### of Historical #### Financial #### Information #### (“ISAE (UK) #### 3000”) issued by the #### Financial #### Reporting Council, to #### express an #### opinion on #### whether the #### iXBRL #### mark up #### of consolidated #### financial #### statements #### complies in #### all #### material #### respects #### with #### DTR 4.1.15R- #### DTR #### 4.1.18R based on the evidence we have obtained. #### Directors’ #### responsibilities #### The #### directors #### are #### responsible for #### preparing the #### Electronic #### Format #### Annual #### Financial #### Report in compliance with DTR 4.1.15R-DTR 4.1.18R. This responsibility includes: • #### The #### selection and #### application of #### appropriate #### iXBRL #### tags #### using #### judgement #### where #### necessary. • #### Ensuring #### consistency #### between #### digitised #### information and the #### consolidated #### financial #### statements #### presented in human-readable format. • #### The design, implementation, and #### maintenance of #### internal #### control #### relevant to the #### application of #### DTR 4.1.15R-DTR 4.1.18R. #### Our #### responsibilities We #### are #### responsible for: • #### Planning and #### performing #### procedures to #### obtain #### sufficient #### appropriate #### evidence in #### order to #### express #### an independent reasonable assurance conclusion on the iXBRL mark up. • #### Reporting #### our #### conclusion in the #### form of an #### independent #### reasonable #### Assurance #### Report to the #### Members. #### Our #### independence and #### competence In #### conducting #### our engagement, we #### complied #### with the #### independence #### requirements of the #### FRC’s Ethical Standard and the ICAEW Code of Ethics. The ICAEW Code is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and #### professional behaviour. We #### applied the #### International #### Standard on #### Quality #### Management (UK) 1 #### (“ISQM (UK) 1”), #### issued by the Financial Reporting Council. Accordingly, we maintained a comprehensive system of quality #### management including documented policies and procedures regarding compliance with ethical #### requirements, professional standards and applicable legal and regulatory requirements. #### Key #### procedures #### performed #### A reasonable assurance engagement in accordance with ISAE (UK) 3000 involves performing procedures to #### obtain reasonable assurance about the compliance of the mark-up of the consolidated financial statements with the DTR 4.1.15R-DTR 4.1.18R. The nature, timing and extent of procedures #### selected were based on our professional judgement, including the assessment #### of the risks of material #### departures #### from the #### requirements #### set #### out in #### DTR #### 4.1.15R-DTR 4.1.18R, #### whether #### due to #### fraud or #### error. Our reasonable assurance engagement consisted primarily of: • #### obtaining an #### understanding of the #### iXBRL #### mark up process, #### including #### internal #### control #### over the mark up process relevant to the engagement; • #### reconciling the #### marked up #### data #### with the #### audited #### consolidated #### financial #### statements of the #### company #### dated 19 #### June 2025; • #### evaluating the #### appropriateness of the #### company’s #### mark up of the #### consolidated #### financial statements using the iXBRL mark-up language; • #### evaluating the #### appropriateness of the #### company’s use of #### iXBRL #### elements #### selected #### from a #### generally #### accepted #### taxonomy and the #### creation of #### extension #### elements #### where no #### suitable element in the generally accepted taxonomy has been identified; and • #### evaluating the #### use of #### anchoring in #### relation to the #### extension #### elements. #### In this report we do not express an audit opinion, review conclusion or any other assurance conclusion on the consolidated financial statements. Our audit opinion relating to the consolidated #### financial #### statements of the #### company for the #### year #### ended 30 #### March 2025 is #### set #### out in #### our #### Independent #### Auditor’s Report dated 19 June 2025. #### Use of #### our #### report #### This #### report is #### made #### solely to the #### company’s members, as a body, in #### accordance #### with #### ISAE (UK) 3000 and #### our agreed #### terms of engagement. Our work #### has #### been #### undertaken so #### that we #### might state to the #### company those matters we have agreed to state to them in this report and for no other purpose. #### Without assuming or accepting any responsibility or liability in respect of this report to any party #### other than the company and the company’s members, we acknowledge that the company may #### choose to make this report publicly available for others wishing to have access to it, which does not and #### will #### not #### affect or #### extend for #### any #### purpose or on #### any #### basis #### our #### responsibilities. To the #### fullest #### extent #### permitted by law, we do #### not #### accept or #### assume #### responsibility to #### anyone #### other #### than the #### company and #### the company’s members as a body, for our work, for this report, or for the conclusions we have #### formed. #### Tom Millar, #### ACA (Senior #### statutory #### auditor) #### For and on behalf of Deloitte LLP Statutory Auditor London, #### United #### Kingdom #### 19 June 2025