Thank you very much, ladies and gentlemen, for coming to our Financial 2019 pre-results update. This will be brief, but just important to get you in the right mindset shortly before year-end. Before I start, I have two things. Firstly, I think it's appropriate on a morning like this just to pay our respects to people who were very unnecessarily and brutally murdered in New Zealand overnight. I think it's the kind of thing that makes you understand that we all should work for better community, better life, where people understand one another. That in this world, every day, things like these happen. When these headlines hit us, we ought to pause and think. From Investec side, I just want to say, we think of the victims, the victims' families, and of that community that's been so hard hit.
Secondly, I don't see him on the screen, but it is important today to thank one special person. Glynn Burger, currently our Executive Director for Finance and Risk, who is retiring in 15 days' time or 16 days' time. Glynn has been with this group, as Stephen always reminds us, since the 17th of December 1980. Those of you who can calculate, that is a lifetime of work. Glynn has always been the man somewhere just around Stephen and Bernard, but doing a lot of the work that is not seen in public that really matters in tough times. We all, as current management, Fani, myself, and the board, would like to thank Glynn for his contribution and for what he's done to build this group. Thank you. Let's give him a hand.
You would remember that approximately six months ago, we announced the strategic direction of the group simultaneous to a leadership change. That was all about simplifying the group, focusing it, and growing with discipline. Subsequently, we've had two capital markets days, one for the Asset Management business in November, and then more recently for the Bank and Wealth business, where Fani and the team presented that. We just want to reiterate that we are on a strategic path. We are not deviating from that. Subject to regulatory and shareholder approval, we will be de-merging the Asset Management business, and we will be pursuing this path of greater focus and disciplined growth in the long term. As far as the Bank and Wealth business is concerned, Fani communicated some important strategic priorities at the recent capital markets day.
It is all around increased discipline in capital allocation, management of the cost base for greater efficiencies, accelerating revenue growth where possible, expanding connectivity across the organization, i.e., harmonizing what we're doing for greater effect for clients, and ultimately bolstering our digital capabilities at a time when that is not an option anymore. That is a necessity. On the Asset Management side, the focus is really very much on the existing business and offerings, but leveraging the unique global distribution reach that's been built and investing in deepening and strengthening the investment in client offerings so that continued growth can be assured. We'll talk more about that. There will be a capital markets day for the Asset Management business shortly after results in mid-May. Fani and the Bank and Wealth team will engage again with shareholders to reiterate their strategy during the shareholder communication post-results.
There will also be a circular release between now and results with additional detail, particularly around the capital effect of our plan. Certainly, the numbers that I know the analysts would like to see. You'll be well prepared for our May results presentation and the subsequent engagement with us after that. I think it's important to just remind you of the operating environment we've been in. It's pretty tough. The fourth quarter of the calendar year 2018 was a pretty volatile one in terms of equity and currency movements. Also, of course, growth in our two core geographies for the Bank and Wealth business has been rather weak. I think that does have an effect on the business, and one cannot ignore that.
Overall group performance for the year to 31 March, or as it was at 28 February, well, revenue gives us a clue for where we are. Revenue is expected for the full year to be in line with the prior year. We've experienced substantial net inflows in the Asset and Wealth Management business. The loan books have grown in local currency. Our annuity income is at the same traditional high level that we are used to. Our expected credit loss charge is anticipated to be significantly less than the prior year, and the ratios are expected to be between 0.3 and 0.35. I think that is well expected and signaled. Modest cost growth in the business. We've had some one-offs to contend with. We'll explain them in the divisional review, and you'll see them in the results.
We are focusing on cost, and you'll see increasing focus as we go into the new year. Taken together, adjusted operating profit is expected to be ahead of the prior year. Overall, the group results have been impacted by the currency movements up to the end of February. In terms of the average rand rate against the pound sterling, there's been a weakness of around 4% or a depreciation of around, on the average, a depreciation of around 4%. Of course, as I said, the proposed demerger and separate listing of Investec Asset Management is on track subject to final regulatory and shareholder approvals. If I go to the divisional results, now we report. We will report in the same format as in the past, but we see the group is in two units now, Bank and Wealth and Asset Management.
The Bank and Wealth business is expected to report results ahead of the prior year. The Asset Management is expected to report results marginally behind the prior year. Our earnings drivers for the year, really increased assets under management. The number at the end of February was 163.7 or just under GBP 164 billion under management for the whole group. Our core loans and advances, although they've decreased in GBP, have grown in neutral currency and in local currencies where we've lent, and our customer deposits have increased by 1.1% to GBP 31.3 billion and much more on a currency-neutral basis. Balance sheet and liquidity. Well, we are comfortable with where the balance sheet is, both from a liquidity point of view, which I think in this kind of environment is pretty important, particularly if you think about Brexit and the uncertainties around that.
Our capital ratios are within our targets. The Investec Limited and Investec plc CET1 ratios are expected to remain in line with this target of 10%. We expect to implement FIRB in South Africa in the first quarter, subject to final regulatory approval. Our leverage ratios are robust and comfortably ahead of the target of 6%. I think you put together the divisional review. Specialist banking was where the momentum was over the last reporting period, with a rise in net interest income on the back of a very strong performance from the U.K. specialist bank. The South African specialist bank is expected to report results behind the prior period, but on the whole, it will be ahead. The net fee income will be flat.
Strong advisory and structure fees in the U.K. banking business offset by lower investment banking and corporate client activity in South Africa, which is consistent with the environment. Other income is down, largely because of realizations not taking place and weaker performance across the investment portfolio, both listed and unlisted. Impairments have decreased significantly, as we discussed earlier, due to no further occurrence of substantial losses on the legacy portfolio. We're moving on from that concept legacy. Costs are up. In the U.K., expected to be roughly in line with revenue, and in South Africa, it's growing ahead of revenue, but there is a lender provision release which makes the cost look higher than the underlying cost growth, which you'll see in detail in the report results. If I go to the wealth and investment business, that is expected to be below the prior year or behind.
Net inflows, still very good, GBP 0.5 billion in this market, and it's mostly in the discretionary end, which is where the value is. We have lost some assets in discontinued non-core U.K. services and also, as a consequence, lower transaction-based commissions and, of course, the non-recurrence of an investment gain, which is in the numbers last year. A solid business, but with lower numbers for this year. On the asset management side, we've experienced substantial net inflows, GBP 6.4 billion to the end of February, which is really the highlight of the asset management result. Revenue growth was dampened by the considerable volatility in the final quarter of 2018. You would remember how the average assets dropped over that quarter and recovered in the new year, but not at the final quarter of 2018.
Earnings have also been impacted by lower performances in South Africa, higher costs in the U.K., which include MiFID and new premises. That's the picture for the asset management business, GBP 109 billion under management as at the end of February. I think it's important to note, Nic has, I think, warned last time about the tax rate. The tax is slowly increasing, but when you come from a financial crisis, your tax rate stays low for a while, and that's what's basically happening. Our tax rate at group level is normalizing. It's expected to be approximately 13% compared to the 9.6% of the prior year. Net non-controlling interest of approximately GBP 91 million related to the asset management business and the consolidation of the property fund. Finally, the weighted number of shares.
You know capital discipline is a big and important point for Fani and I, but there are still some options and other things maturing, the number of shares has increased to 942 million. That is an area of focus for us, and we'll talk more about that at results time. In conclusion, ladies and gentlemen, the group's performance has been supported by growth in assets under management, substantial net inflows, loan growth, and significantly, a substantial improvement in the U.K. specialist banking business. The group is committed to our strategy of simplification, focus, and growth with discipline. The bank and wealth business and the asset management businesses are dedicated to pursuing this objective as outlined in the Capital Markets Day, and making sure we deliver on not only those targets, but pursue those objectives doggedly.
We'll talk more about that in both the Capital Markets Day of the asset management business and the results presentation. You'll hopefully be well prepared when reading the circular about the balance sheet strength of the group going forward. Thank you very much. Are there any questions? Fani, would you like to add anything? Lushna? Okay, you can get the difficult questions. Any questions from Johannesburg? There's a question.
Hendrik, we do have a question. Hold on one second.
Thank you.
Good morning to you. Hendrik, I'm referring to the information provided on pages 24 and 25, wealth and investment assets and asset management assets. It's very pleasing to see the increase in South African mutual funds over the year of 26.1%, and to note further that most of the growth came in the second half. Why then is there a substantial reduction of nearly 18% in the segregated mandates? This position is very much mirrored if you refer to the wealth and investment assets for Southern Africa as well.
Number one, there's a significant flow between. There are significant market movements. If I look at the South African segregated assets, we've had in February 2019, you have a GBP 16 billion. In September 2018, you had GBP 18.5 billion, and you had significant market movement against you in that final quarter. I would describe it largely to market movement. This is not a flow picture. Lushna.
What explains the increase in % for mutual funds, i.e., the non-segregated section?
Lushna? Apologies. There is a typo on page 25. To correct it, the mutual funds have increased by 5.1%. 1.5% down on segregated. There is still a down on segregated. The question is correct, on segregated, the down. The mutual funds had. Really, that's about the asset mix that you have. The asset mix inside and the flow mix. The flow picture in South Africa has been pretty solid, as you know, if you look at the market. Remember that fourth quarter, and again, in South Africa, your book is driven by the movement of very few stocks. A 1% or a 2% movement either way is not that significant. I think that % number must have confused you and attracted attention, so apologies for that.
There's also a % number mistake under, if you look at the lower part, that 41.3 and eight is also wrong. It should be 17.8 and 10.4 at the bottom end of that table. We'll reissue that table so that it doesn't generate confusion.
Okay. Thank you.
Are there any more questions in Johannesburg?
We have one more question, Hendrik. Hold on.
Ian Grobbelaar, Institute of Race Relations. There's been a surge in South Africa of new digital banks either starting or about to start in the banking business arena. Do you see this as making any significant difference to your model? You've always been really strong on personal attention to your clients. Do you think that the fact that clients no longer have to come to you have to cater to them to a greater extent, is going to make a difference to your operating model?
I will take the question. I'll ask Farnie to add if he thinks I haven't answered it properly, because that's his domain. We have always been a business where clients didn't actually have to come to us. We've never been a branch operation historically. We've communicated with our clients via the telephone. We've gone to them. Now we've added very substantial digital investment to communicate. If you look at the advertising campaign that we launched this quarter in South Africa or beginning of the year in South Africa, it was all about combining personal experience with digital efficiency. We operate at the upper end of the market, where people demand more than just a click. They want a click, but they want the person as well. We feel the Investec model is extremely robust and well-suited.
It's not about, if you have big, blunt structures, it's about cost saving. For us, it's about serving clients and therefore our digital investment. If you look at our costs when we report for the full year, you'll see the digital investment is substantial in this group. We don't feel as if anything is changing. In fact, the market is probably coming towards Investec, and we have the clients. Many people want the clients, but we think we have more than a digital interface with them. I think in the Capital Markets Day, Ciaran Whelan explained it really well. If you want to go and get a longer answer, go to the Capital Markets Day presentation. Ciaran is there. Maybe you can answer it as well, Ciaran. In the Capital Markets Day, we did it really well of how we compete with digital competitors.
Thanks, Hendrik. I'll just add to what you said. We do get this question a lot in South Africa about some of the new entrants that are coming, both at the lower end and people like the life insurance companies. One of the key differentiators that we have is that we offer both local and international offerings to our South African clients. No other institution in South Africa can do that as seamlessly as we do it. Local banking, local investing, offshore banking, and offshore investing. For any of you that are South African who have tried to get banking facility overseas, particularly in the U.K., it is exceptionally difficult. It is long-winded. You've got to fill in a lot of forms that you don't like doing, and that annoy you. That we can provide those facilities easily.
Overseas, if you're a South African, you are deemed to be high risk because South Africa is deemed a high-risk country from the money laundering requirements, therefore, the amount of form filling is intense. We provide all of those while complying with the laws very well, because you are clients of our South African operations, and we leverage off of all of the information and history we have, and we know that you're generally not high risk. We can help in those. That is one of our key differentiators, as a South African institution.
Thank you, Ciaran. I think that answers. We know it's going to be a very competitive game. You can talk to Ciaran, Richard, others over tea afterwards about what they're doing. Their minds are fully occupied with an ever-increasing competitive landscape, that is the case for all our businesses. Any other questions?
There's no more in South Africa, Hendrik.
Thank you, Richard. Thank you very much. Any questions in London? I think the questions are going to come at Capital Markets Day and results presentation time, or after the circular has been sent around. We will obviously be available to communicate and respond to any queries or questions once you've had a time to digest the circular. Thank you very much. Thank you for attending, and we'll see you later in the year.