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 Firstly, I think it's appropriate in the morning like this just to pay our respects to people who were Very unnecessarily a group in Northern New Zealand overnight.
I think it's the kind of thing that make sure I understand that we all should work for better community, better life where people understand one another. And that in this world, every day, things like these happen, but when these headlines hit us, we ought to pause and think. So on the West side, I just want to say, we think of the victims of the victims, farmers under 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. Hello.
Glenn Berger, currently our Executive Director for Finance and Risk, He's retiring in 15 days' time or 16 days' time. Jim has been with his group, as Stephen always reminds us, since the 17th December 1980. Those of you can calculate that is a lifetime of work. And then it's 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. And we all as current management, and finally myself and the Board, We'd like to thank Liam for his contribution and for what he's done to build this group.
Thank you. Let's give him a hand. Now You would remember that approximately 6 months ago, we announced the strategic direction of the group to a leadership change and that was all about simplifying the group, focusing it and growing with discipline. And subsequently, we've had 2 Capital Markets Day, 1 for the Asset Management business in November and then more recently for the Bank and Wealth business where Fani and the team presented that. And 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 demerging the Asset Management business and we will be pursuing this part of greater focus and disciplined growth in the long term. And as far as the Wealth and Bank of the Wealth business is concerned, Farley communicated some important strategic priorities at the recent Capital Markets Day, which 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 success 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 offering, but leveraging the unique global distribution reach that's been built and investing and deepening and strengthening the investment in client offerings so that continued growth can be assured. I will talk more about that. There will be a Capital Markets Day for the Asset Management business shortly after results in mid May. And finally, 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 details, particularly around the capital effect of our plan.
And certainly the numbers that I know the analysts would like to see, we will 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. Pretty tough. The Q4 of the calendar year 2018 was a pretty volatile one in terms of equity and currency movements. And also, of course, growth in our 2 core geographies for the Bank and Wealth business has been rather weak.
And I think that does have an effect on the business and one cannot ignore that. Overall group performance for the year to 31 March 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 credit loss charge, expected credit loss charge is anticipated to be significantly less than the prior year and the ratios are expected to be between 0.3percent.25percent, and 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. We'll see them in the results, low. We are focusing on cost and you'll see increasing focus as we go into the new year. Taken together, adjusted operating profit it's expected to be ahead of the prior year. And overall, the group results have been impacted by the currency movements up to Yes, it will be in the February.
In terms of the average rand rate against the pound sterling, there's been a weakness of around 4% or depreciation of around on the average depreciation of around 4%. And then, of course, as I said, the proposed demerger and separate listing with Investec Asset Management is on track, subject to final regulatory and shareholder approvals. Then if I go to the divisional results, and now we report we will report in the same format as in the past, but we see the group as 2 units now, Bank and Wealth and Asset Management. The Bank and Wealth business is expected to report results ahead of the prior year and 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, that's under 164,000,000,000 pounds under management for the whole group. Our core loans and advances, although they've decreased in sterling, have grown in neutral and in local currencies where we've linked and our customer deposits have increased by 1.1 percent to €31,300,000,000 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. And our capital ratios are within our targets. The Investec Limited and Investec PLCC 1 ratios are expected to remain in line with a target of 10%.
We expect to implement 3rd in South Africa in the first subject to final regulatory approval and our leverage ratios are robust and comfortably ahead of the target of 6%. I think if you go to the divisional review, Specialist Banking is where the momentum was over the last reporting period with a rise in net interest income and on the back of a very strong performance from the Nuclear 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 UK Banking business offset by lower Investment Banking and Corporate Client activity in South Africa, which is consistent with the environment. And then other income is down, largely because of realization not taking place and weaker performance across the investment portfolio based listed and unlisted.
Impairments have decreased significantly as we discussed earlier due to no further currency substantial losses on the legacy portfolio. So we're moving on from that concept legacy. Costs are up in the UK expected to be roughly in line with revenue. And in South Africa, It's going ahead of revenue, but there is a rental provision release, which up higher or with net, the costs 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 we're behind.
Net inflow is still very good, €500,000,000 in this market. And it's mostly in the discretionary end, which where the value is, but we have lost some assets in discontinued non core UK services and also as a consequence lower transaction based commissions low. And of course, the non recurrence of an investment going, which is in the numbers last year. So solid business, but with lower numbers for this year. On the asset management side, we've experienced Substantial net inflows, dollars 6,400,000,000 to the end of February, which is really the highlight of the asset management results.
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 end of the final quarter of 2018. And earnings have been also been impacted by lower performance fees in South Africa, higher costs in the UK, which includes MiFID and new premises. So that's the picture for the asset management business, £109,000,000,000 under management I think it's important to note that we mentioned that I think last time 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 really happening.
Our tax rate at group level is normalizing. It's going to be it's expected to be approximately 13% compared to the 9.6% of the prior year. Net non controlling interest of approximately €91,000,000 related to the Asset Management business and the consolidation of the property fund. And then finally, the weighted number of shares and you know capital discipline is a big and important point for funding, but there are still some options and other things maturing. So the number of shares has increased to 9.40 that is an area of focus for us and we'll talk more about that in as a result.
So 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, simplification, focus and growth with discipline. And the Bank and Wealth Business and the Asset Management businesses are dedicated to to pursuing this objective as outlined in the Capital Markets Day and making sure we deliver on those, not only the targets, but to see those objectives doggedly and we'll talk more about that in both the Capital Markets Day of the Asset Management business and the results presentation and 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? Michelin, maybe looking at the difficult question. So any questions from Johannesburg?
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 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 percent. 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. And this position is very much mirrored if you refer to the Wealth and Investment Assets for Southern Africa as well?
Number 1, there's a significant flow between the significant market movers. If I look at the South African segregated assets, we've had in February 2019, You have a €16,000,000,000 In September 2018, you had €18,500,000,000 a year and you had significant market movement against you in that final quarter. So I would describe it largely to market movements. It is not a slow picture.
Then what explains The increase in percentages for mutual funds, I. E, the non segregated section.
Yes, apologies. There is a typo on Page 25. But to correct it, The mutual funds have increased by 5.1%.
1.5% down.
And 1.5% down on segregated.
But there is still a down on segregated. So the question is correct on segregated is down. And the mutual funds loan and really that's about the asset mix that you have. You may have the asset mix inside and the flow mix. But The slow picture in South Africa has been pretty solid as you know, as you look at the market.
But remember that Q4 and again in South Africa your book is driven by the movement of very few stocks And so 1% or 2% movement either way is not that significant. So I think that percentage number must have confused you and attractive attention. So apologies for that. And then also a percentage number in the stake under if you look at the lower part, the that 41.3 and 8 is also wrong, it should be 17.8
Okay. Thank you. Are there any more questions?
We have one more question, Hendrik. 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 is 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 the clients no longer have to come to you, you have to keep it to them, to a greater extent, you're going to make a difference to your operating model.
I will take the question, and I'll ask Fahmi to add if he thinks I haven't answered it properly because that is the main. But we have always been a business where clients didn't actually come have to come to us. We've never been a branch operation. We've communicated with our clients via telephone, we've gone to them and now we've added very digital investment to communicate. And if you look at the advertising campaign that we launched this quarter in South Africa, beginning of the year in South Africa, it was all about combining personal experience with digital efficiency.
And we operate at the upper end of the market where people demand more than just a click. They want a click, but they want a person as well. And so we feel the Investec model is extremely robust and well suited. And it's not about if you have big brand structures, it's about cost savings. For us, it's about serving clients and therefore, our digital investment.
And if you look at our costs, So as we report for the full year, you'll see the digital investment is substantial in this group. And we don't feel that 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. And I think in the Capital Markets Day, Kieran Wieben explained it really well.
If you want to go and get a longer answer, Hello. Capital Markets Day presentation, Kieran and Deran, maybe you can answer as well, Kieran. But in the Capital Markets Day, you did it really well on 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 engines that are coming, both at the lower end and people like They're life insurance companies. 1 of the key differentiators that we have is that we offer both local and international offerings to our South African clients. So no other institution in South Africa can do that as seamlessly as we do it.
So local banking, local investing, Offshore Banking and Offshore Investing. And for any of you, as I said, 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.
And then we can provide those facilities easily. Because overseas, if you're a South African, you are deemed to be hard risk because South Africa is deemed the high risk country from the money laundering requirements. Therefore, the amount of form filling is intense. So we provide all of those while complying with the laws Very well because you are trying to serve our South African operations, and we leveraged up with all of the information and history we have, And we know that you're generally not high risk, but we can help in those. And that is one of our key differentiators as a South African institution.
Thank you, Kieran. I think that answers, but we know it's going to be a very competitive game. You can talk to Kieran, Richard, Others over tea afterwards about what they're doing. They optimize a fully occupied with an ever increasing competitive landscape and 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 after the circulating center round and we will obviously be available to communicate and respond to any queries and questions once you've had a time to digest the circular.
Thank you very much.