Investec (comprising Investec plc and Investec Limited) - Interim Management Statement released on

3 February 2012

This Interim Management Statement is issued by Investec in accordance with the UK Listing Authority's Disclosure and Transparency Rules. Unless stated otherwise, key trends and figures highlighted below refer to the nine months ended 31 December 2011 and the corresponding period in the previous year.

Performance overview

Against a backdrop of volatile markets and low levels of activity the third quarter of the group's 2012 financial year has proven to be challenging. The asset management and wealth management businesses continued to see net inflows however overall assets under management pre the acquisition of Evolution Group plc (refer below) declined. The Specialist Banking businesses benefited from growth in both margin and fee income but earnings from principal activities decreased substantially.

Salient features of the nine month period to 31 December 2011 compared to the nine month period to

31 December 2010:

·      The group recorded an increase in total operating income net of insurance claims and depreciation of leased assets of 4.6%.

o  Net interest income was 7.7% ahead of the prior year.

o  Net fees and commissions were 16.3% ahead of the prior year.

o  Income from principal transactions was 31.3% behind the prior year.

·      Operating costs increased by 6.8% compared to the prior year.

·      Operating profit before goodwill, acquired intangibles, non-operating items and taxation and after non-controlling interests is 5.6% behind the prior year.

·      The credit loss charge as a percentage of average gross loans and advances annualised for the period amounted to 1.00% (31 March 2011: 1.27%).

·      Recurring income as a percentage of total operating income amounted to approximately 69%.

·      As at 31 December 2011 the capital adequacy ratio of Investec plc (applying UK Financial Services Authority rules to its capital base) was 17.2% and the capital adequacy ratio of Investec Limited (applying South African Reserve Bank rules to its capital base) was 15.8%. The ratio for Investec plc takes into account the implementation of Basel 2.5 which became effective on 31 December 2011. The ratio for Investec Limited is pre Basel 2.5 which only became effective on 1 January 2012. The impact of Basel 2.5 on Investec Limited is not significant.

·      The group had approximately GBP9.5 billion of cash and near cash available to support its activities. 

·      Since 31 March 2011 (the end of the group's financial year):

o  Third party assets under management increased 1.9% to GBP90.6 billion - an increase of 8.2% on a currency neutral basis. These numbers include GBP6.9 billion acquired from the Evolution Group plc.

o  Customer accounts (deposits) decreased 0.7% to GBP24.3 billion - an increase of 5.6% on a currency neutral basis.

o  Core loans and advances decreased 3.2% to GBP18.2 billion - an increase of 4.7% on a currency neutral basis.

·      Core advances (excluding own originated securitised assets) as a percentage of customer deposits were 70.6% (31 March 2011:72.4%).

Significant transactions during the period

On 9 September 2011, the Board of Directors of the Evolution Group plc and Investec plc announced that they had reached agreement on the terms of a recommended share offer, to be implemented by way of a Court sanctioned scheme of arrangement under Part 26 of the UK Companies Act 2006 (the "Scheme"), under which it was proposed that Investec plc would acquire the entire issued ordinary share capital of the Evolution Group plc. The Scheme became effective on 22 December 2011, whereupon Investec plc issued 53,800,540 Ordinary Shares at a value of 326.8 pence each as consideration for the acquisition of the entire issued ordinary share capital of the Evolution Group plc.

The group will be holding a pre-close briefing on 15 March 2012.

On behalf of the board

Fani Titi (Joint Chairman), Sir David Prosser (Joint Chairman), Stephen Koseff (Chief Executive Officer) and Bernard Kantor (Managing Director)

Notes:

1.   The financial information on which this statement is based has not been reviewed and reported on by the group's auditors.

2.   Please note that matters highlighted above may contain forward looking statements which are subject to various risks and uncertainties and other factors, including, but not limited to:

-      the further development of standards and interpretations under International Financial Reporting Standards (IFRS) applicable to past, current and future periods, evolving practices with regard to the interpretation and application of standards under IFRS.

-      domestic and global economic and business conditions.

-      market related risks.

•       A number of these factors are beyond the group's control.

•       These factors may cause the group's actual future results, performance or achievements in the markets in which it operates to differ from those expressed or implied.

•       Any forward looking statements made are based on the knowledge of the group at 3 February 2012.

3.   The group's reporting currency is Pounds Sterling. Certain of the group's operations are conducted by entities outside the UK. The results of operations and the financial condition of the group's individual companies are reported in the local currencies in which they are domiciled, including Rands, Australian Dollars, Euros and Dollars. These results are then translated into Pounds Sterling at the applicable foreign currency exchange rates for inclusion in our combined consolidated financial statements. In the case of the income statement, the weighted average rate for the relevant period is applied and, in the case of the balance sheet, the relevant closing rate is used. The following table sets out the movements in certain relevant exchange rates against Pounds Sterling over the period:

4.   The following disclosures are made with respect to Basel quarterly disclosure requirements:

The group holds capital in excess of regulatory requirements targeting a minimum tier one capital ratio of 11% and a total capital adequacy ratio range of 14% to 17% on a consolidated basis for each of Investec plc and Investec Limited. As per the table below, all regulated entities met these targets at the reporting date.  

*IBP is Investec Bank plc; IBAL is Investec Bank (Australia) Limited and IBL is Investec Bank Limited. ^Investec plc includes IBP. IBP includes IBAL. Investec Limited includes IBL.

Timetable:

Pre-close briefing: 15 March 2012

Year-end: 31 March 2012

Release of year-end results: 17 May 2012

For further information please contact:

Investec Investor Relations                                                                     

UK: +44 (0) 207 597 5546                                                          

South Africa: +27 (0) 11 286 7070

investorrelations@investec.com

About Investec

Investec is an international specialist bank and asset manager that provides a diverse range of financial products and services to a niche client base in three principal markets, the United Kingdom, South Africa and Australia as well as certain other countries. The group was established in 1974 and currently has approximately 7 400 employees.

Investec focuses on delivering distinctive profitable solutions for its clients in six core areas of activity namely, Asset Management, Wealth & Investment, Property Activities, Private Banking, Investment Banking and Capital Markets.

In July 2002 the Investec group implemented a dual listed company structure with listings on the London and

Johannesburg Stock Exchanges. The combined group's current market capitalisation is approximately GBP3.3 billion.