Investec Irish restructuring cost £41m

INVESTEC, an Anglo-South African financial services company, has said that the Brexit-related restructuring of its Irish branch cost £41m in the year to the end of March 2020, including a provision for an “ongoing legal situation”.

In an analyst call, Fani Titi, joint chief executive of Investec, confirmed that it had booked further losses on the restructured Irish branch in relation to an ongoing litigation.

He declined to disclose any more details on the matter.

On the £41m cost of restructuring the Irish branch, and the provision for the litigation, a spokeswoman for Investec said: “The amount involved includes the costs of restructure of the Irish branch arising from Brexit which, as previously disclosed, involved the repayment of €1.2bn of deposits and the closure of certain other businesses.

“The amount also reflects a provision for potential costs linked to litigation in respect of an historic risk matter associated with businesses closed.

“In this regard, while we consider the provision sensible, we are not in a position to disclose further detail because of the ongoing legal situation.”

Last May, the South African-founded bank sold its wealth management business in Ireland to British investment manager Brewin Dolphin for €44m.

The acquisition increased Brewin Dolphin’s presence in Ireland, with €4.6bn under management, making it the third-largest discretionary wealth manager in the State after Davy and Goodbody.

Investec made an £18.2m gain from the sale of its Irish wealth management business.

In 2018, Investec had cut numbers at the unit in Dublin from 11 to five, and shifted its reporting lines to London as part of a wider Brexit-proofing of the business.

The bank also announced it would stop holding Irish deposits in late 2018.

The Irish-regulated business is focused on services such as treasury, including currency hedging for clients and corporate finance.