Old Mutual, the listed financial services group, has received approval from the Prudential Authority to establish a bank in South Africa, with plans for a launch by the end of the year.
The approval, granted after a thorough regulatory review of Old Mutual's application under the Banks Act, allows the group to progress to the next crucial phase of establishing the bank.
With the green light, Old Mutual said it will transition from "bank build mode" to a rigorous industry testing phase in collaboration with selected bank partners.
“Upon successful error-free testing, the new OM Bank will fully integrate into the National Payments System,” it said.
The upcoming launch of Old Mutual Bank adds another dimension to the group's existing suite of lending and transactional products, including the successful Old Mutual Money Account operated in partnership with Bidvest Bank.
By establishing its bank, Old Mutual aims to deepen customer relationships, drive cross-selling opportunities, and tap into retail deposits to optimise funding sources.
The strategic expansion into banking aligns with Old Mutual's commitment to delivering a seamless customer experience through a human-led, technology-enabled distribution model.
With over 796 retail branches and 1.4 million active digital users, the group is well-positioned to leverage its extensive distribution network and digital capabilities to enhance accessibility and convenience for customers.
Chairman Trevor Manuel previously noted the transformative potential of Old Mutual Bank, highlighting its use of artificial intelligence (AI) to streamline processes, reduce operating costs, and develop innovative financial offerings.
Shares in the group are down some 12% over the past year, despite resilient financial results. The group was established in Cape Town in 1845 as South Africa's first mutual life assurance society.
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