Nedbank is not for sale, Old Mutual CEO Julian Roberts said on Wednesday as he posted the group's results for the year to December.

Instead, the financial services group plans to strengthen its bancassurance relationship as it refocuses its global operations.

It will also swap stakes in joint ventures it has with Nedbank for a larger shareholding in the bank in exchange for giving Nedbank full control of operations that include Nedgroup Life Assurance Company Fairbairn Private Bank and private client business BoE Limited.

Old Mutual's stake in Nedbank would grow about one or two percentage points from its current 53 percent.

Robert was reacting to weekend rumours that Old Mutual was poised to sell Nedbank to boost its capital reserves due to solvency and liquidity issues at its US life operations, which have been hit by the economic turmoil.

Although he said the group's capital position was sound, the Old Mutual board had withheld a final dividend to create a further buffer in case of any further deterioration in US credit markets.

Roberts said the group's liquidity was within its target range, despite the effect of the final quarter of last year as global turmoil escalated.

The group's liquidity buffer of £600-million in cash and facilities was expected to be strong enough to withstand any significant further deterioration in the US, he said. "Liquidity has held up well. We had some dark days in the fourth quarter," Roberts said.

The group had so far achieved R1-billion of pretax savings a year as a result of the closer co-operation between Old Mutual SA (Omsa) and Nedbank, and it planned to build on this by growing Nedbank's retail footprint in line with Old Mutual's.

As part of a restructuring of the group's global operations, Omsa MD Paul Hanratty had been elevated to a global position to oversee all of Old Mutual's long term savings businesses.

Mark Nicholson, an analyst with S&P Equity Research in London, said it appeared that Old Mutual's emphasis on getting value out of its more profitable South African operations made it likely that any asset sales in the future would be outside of SA.

However, he said the group was unlikely to sell any further operations while market conditions remained poor.

Nicholson said the group's surplus capital of £700-million remained "thin" compared with other large insurers. The share price, which has fallen 27 percent this year and closed 1.2 percent lower at R5.57 yesterday, was likely to remain depressed until there was a clearer indication of how management planned to take the group forward, he said.

Business Day