Investec dodges bullet from Steinhoff after lower than expected losses

On the up: Investec said losses from the Steinhoff fall-out were less than feared

Anglo-South African lender Investec said on Thursday it avoided the worst of the crisis at Poundland owner Steinhoff.

The England hockey and horse racing sponsor was a bondholder and exposed to derivative contracts tied to Steinhoff shares but has limited its loss to £13 million.

In December Steinhoff revealed accounting irregularities and shares have since collapsed 95%.

Investec’s departing boss Stephen Koseff said: “We managed to trade out better than the extreme. The extreme was we assumed they went broke.“

However trading income was down 12.5% to £138.2 million due to the Steinhoff crisis.

The near-collapse of the South African giant is considered the largest corporate failure in the country's history.

“They took on too much debt outside of South Africa. It was a shock initially but business is carrying on,” Koseff said.

Investec total operating profits rose 1.4% to £607.5 million.

The group also called time on its UK legacy portfolio - made up of bad loans from before the financial crisis.

The book, made up of Irish and UK regional property loans, has fallen from a peak of £4.8 billion nearly a decade ago and stands at £313 million.

From next year the company will no longer include the portfolio on its balance sheet under new accounting rules.