South Africa’s Old Mutual bank targets profit as customers near 1 million

Old Mutual’s new South African bank is nearing 1 million customers less than two years after launch, as the financial services group targets profitability by 2028 after investing billions of rand to build the lender. 

OM Bank has already attracted 742,000 customers and R1.38 billion ($86.27 million) in deposits since its August 2025 launch. Chief Executive Officer Jurie Strydom said the bank expects to cross the 1 million-customer mark within the next few weeks. 

The rapid customer growth gives Old Mutual a larger base from which to expand deposits and lending as it seeks to challenge established South African banks for a greater share of banking earnings. 

Strydom said OM Bank is targeting an operating result ranging from break-even to a profit of R200 million ($12.5 million) in 2028.

Old Mutual plans bigger banking operation 

Old Mutual expects OM Bank’s deposits to grow to as much as R10 billion ($625.14 million) by 2028, while lending could reach R26 billion ($1.63 billion). 

The insurer has invested more than R4 billion ($250.06 million) in establishing the bank and has earmarked another R2 billion ($125.04 million) to support its growth. 

The scale of that investment highlights the importance of banking to Old Mutual’s broader strategy. The company is building the lender while also using share buybacks to return capital to investors. 

Old Mutual has spent R5.5 billion ($343.88 million) buying back its shares since 2023, including R3 billion ($187.57 million) in the six months through June.

The board has approved another R1 billion ($62.52 million) in repurchases this year.

Profit pressure persists at Old Mutual 

The banking expansion comes as Old Mutual reported a 30% decline in adjusted headline earnings to R2.95 billion ($184.45 million) for the six months through June.

It was the company’s first profit decline since 2022, with weaker investment returns affected by risk-off sentiment linked to conflicts in the Middle East. 

Its preferred results-from-operations measure, however, rose 7% to R5.28 billion ($330.13 million), helped by a 21% increase in premium sales.

Value of new business climbed 32%, while the margin improved 10 basis points to 1.4%, although it remained below the 2% to 3% target range. 

Old Mutual said group equity value increased 4% to R20.66 ($1.29) per share. Its shares rose as much as 1.9% before paring gains. 

Old Mutual, a Johannesburg-based financial services group and one of Africa’s largest insurers by assets, also named Ranen Thakurdin as group chief financial officer-designate, effective Jan. 1. He will succeed Casper Troskie, who is retiring April 30, 2027.