BancABC Interim Financial Results 2010 25 August 2010

1. BancABC Interim Financial Results 201025 August 2010

2. HIGHLIGHTS

3. Financial Highlights • Total income up 29% to BWP251 mill (H109: BWP194 mill) • Net operating income up 80% to BWP45 mill (H109: BWP25 mill) • Attributable profit of BWP28 mill (H109: BWP36 mill) • Share of associate loss • Tax charge in H110 vs. tax credit in H109 • Impairments down 59% to BWP17 mill (H109: BWP41 mill) • Cost : income down from 82% at year end to 77% (H109: 72%) • Deposits up 41% and 23% compared to H109 and H209 • Total assets increased to BWP5.1 billion, 25% and 16% up from H109 and H209 • Average return on equity positive at 14% (H109: 16%)

4. Operational Highlights 4 Six Retail Banking branches opened in Dar es Salaam, Gaborone, Bulawayo, Harare and Chimoio Looking at opening an additional eight new branches before year end Zimbabwe head count right sized BancABC Zambia now profitable and Microfin merger yielding synergistic benefits Improved credit risk management reduces impairments

5. ECONOMIC OVERVIEW

6. Economic Overview 6 • IMF projects global GDP growth to reach 4.2% in 2010 (09: -0.8%): • Growth driven primarily by Asia • Western economies remain sluggish • Economic and business environment in SADC region has improved, growth mainly driven by recovery in commodity prices • Down-side risks to global economic recovery still exist due to: • Sovereign debt crisis in Europe and Middle-East • Austerity measures reducing demand in developed economies • Asset price bubbles in some emerging markets

7. Economic Growth Trends Source: IMF 7

8. 2010 Monthly Inflation Trends Source: Central Banks, Ministries of Finance and Central Statistics Offices • Relatively stable inflation other than in Mozambique where rate worsened rapidly from 5% at start of the year to 14.5% by mid-year. 8

9. Interest Rate Profiles Botswana Mozambique Tanzania Zambia 9 Source: Respective Central Banks

10. Exchange Rate Developments • Local currencies in our markets have generally depreciated against the USD and BWP during the period • Mozambican Meticais had the worst depreciation of 25% against the USD and 19% against the BWP • This had some adverse impact on reported results for the subsidiary • Against the USD, the Zambian Kwacha depreciated 11%, Tanzanian Shilling depreciated by 5% and the Botswana Pula by 6% • Against the BWP, the Tanzanian Shilling marginally appreciated by 1% whilst the Zambian Kwacha depreciated by 5% 10

11. Banking Sector Deposits and Loans Banking Sector Total Deposits (US$m) Banking Sector Loans to the Private Sector (US$m) • The markets continue to be attractive and have generally been growing in the recent past • Opportunities exist to enter new market segments in each country • The Tanzania and Botswana markets continued being the largest • Zimbabwe has rapidly grown in the 2009-2010 period 11 Source: Respective Central Banks

12. FINANCIAL REVIEW

13. Income Statement • Performance primarily driven by growth in net interest income and reduction in impairments • Opex increased mainly because of Zimbabwe post dollarisation • Zimbabwe costs up 138% and accounts for 17% of the 22% YoY increase in expenses 13

14. Income Statement (USD) • Performance primarily driven by growth in net interest income and reduction in impairments • Opex increased mainly because of Zimbabwe post dollarisation • Zimbabwe costs up 138% and accounts for 17% of the 22% YoY increase in expenses 14

15. Attributable Profit Trends 15 • Lower profit after tax in current year not reflective of real performance • Disposal of profitable investments reduces income from associates • Prior year tax credit

16. Income Statement – Segmental Analysis 16

17. Income Statement – Segmental Analysis (USD) 17

18. Income Statement – Net Interest Income 18 Positive trend in net interest income driven by increased margins, better liquidity and increased balance sheet size Recovering economic environment and improved credit risk management reduced impairments Zimbabwe contribution to net interest income growing (12% vs 3% in H1:09)

19. Income Statement – Segmental Analysis 19

20. Income Statement – Impairments & NPLs 20 Trend of impairments and credit loss ratio is declining Net NPLs covered by collateral Overall NPLs have now stabilised

21. Income Statement – Non-Interest Income 21 Bulk of equity investments disposed of in 2009, hence no mark-to-market gains Overall quality of non-interest income improving – greater portion of earnings are now recurring Trading, fee and commission income increasing whilst gains on equity investments are declining

22. Income Statement – Cost to Income Ratio • Cost to income ratio declining with retail costs stabilising and other expenses stabilising in Botswana, Mozambique and Tanzania and declining in Zambia • Zimbabwe costs up post dollarisation - now normalising; hyper-inflation in the past • Head office no longer charging management fees from 2009 • Retail costs were 13% or BWP27 mill of total expenses (09:10% or BWP18 mill) • Going forward, Retail Banking to contribute positively, decreasing C:I ratio • Target C:I ratio remains 50% 22

23. Income Statement – Staff Costs • Total head count in 2010 of 612 vs 561 in 2009 • Growth in staff numbers in last 12 months mainly attributable to retail expansion • BancABC Zambia staff numbers declined from 147 in June 2009 to 125 in June 2010 following Microfin merger 23

24. Retail Banking Capex • Group has incurred bulk of costs on retail roll-out • All IT systems expected to be in place by year end • Incremental capital expenditure to be driven by number of branches opened in subsequent periods 24

25. Balance Sheet 25

26. Balance Sheet (USD) 26

27. Balance Sheet – Overview • Deposits up 41% and 23% relative to H109 and H209 respectively • Growth across all the markets • BancABC Zimbabwe had highest rate of growth off a low base • Loans and advances up 8% and 17% relative to H109 and H209 respectively • Growth significantly from Zimbabwe as economy stabilised • Cautious approach to lending was exercised in other markets • Lending in Mozambique constrained by interest rate movements during the period • Total assets of BWP5.1 billion, an increase of 25% and 16% relative to H109 and H209 respectively, 27

28. Balance Sheet – Loans and Advances • BancABC Botswana continued being largest contributor to Group’s loan book • BancABC Zimbabwe’s contribution grew rapidly on back of economic stability • Loan book is stable 28

29. Balance Sheet – Deposits • Growth in deposits across footprint • Additional funds generated invested mostly in short-term financial instruments • BancABC Botswana still the largest contributor • BancABC Zimbabwe’s contribution to deposits growing 29

30. Balance Sheet – Capital Adequacy • All entities are adequately capitalised • Zambia re-capitalised by injection of US $6 mill in tier II capital and conversion of US $5 mill of existing tier II into tier I capital 30

31. OPERATIONAL OVERVIEW

32. Botswana 32 Economy stabilising and is now growing following recovery in diamond prices PAT improved 84% to BWP11 mill Positive performance driven by increased net interest margins, on a larger balance sheet coupled with reduction in impairment charge Non-interest income declined by 22% to BWP17 mill following reduction in forex trading volumes and margins Operating expenses were flat on prior year

33. Mozambique 33 Economy experienced high volatility in interest and exchange rates during the period PAT declined by 24% to BWP13 mill on account of increased tax rate from 16% to 32% following expiry of fiscal benefits Interest rate volatility negatively affected interest margins leading to reduction in net interest income by 27% to BWP16 mill However, forex trading income increased on the back of increased volume of transactions Operating expenses increased by 7% to BWP29 mill in line with retail expansion

34. Tanzania 34 High exchange rate volatility experienced towards period end, but economy is stable BancABC Tanzania’s liquidity position continued to improve leading to higher net interest income Non-interest income also increased 59% to BWP19 mill from increased forex transactions and bond trading Impairment charge increased 77% to BWP10 mill following classification of a few but large accounts Expenses increased 24% to BWP23 mill mostly from retail expansion related costs PAT none-the-less increased 165% to BWP7 mill

35. Zambia 35 BancABC Zambia has now stabilised and is profitable Subsidiary was re-capitalised during the period Recorded a PAT of BWP7.5 mill compared to a loss of BWP13 mill in prior year Impairments declined to BWP3 mill from BWP22 mill in the prior period. Operating expenses declined by BWP4 mill as a result of synergies arising out of the merger of the bank and microfinance unit Subsidiary is now on strong footing to grow business going forward

36. Zimbabwe 36 Economy growing following end of hyper-inflation in Feb 2009 Subsidiary has been able to grow its income by 195% to BWP59 mill Both loans and deposits increased markedly However, expenses increased 138% to BWP49 mill largely due to an increase in staff costs PAT increased 246% to BWP7 mill

37. Retail Banking Update 37 • Six new branches opened up to half-year • One each in Botswana, Mozambique and Tanzania • Three in Zimbabwe • Expecting to open a further 8 branches by year-end • All IT systems to be fully operational by year-end • Retail has started contributing to the Group’s income stream

38. OUTLOOK

39. Outlook • Economies generally stable in operating countries • Both Retail and Wholesale units expected to do well in the second half • Head Office costs continue to be a challenge although stabilising • Impairments now under control which bodes well for the Group going forward • Would like to start paying dividends in the near term

40. APPENDIX

41. Exchange Rate Developments Movement in Exchange Rates vs. the USD (End Period) Movement in Exchange Rates vs. Botswana Pula (End Period) Source: BancABC 41

42. Banking Sector Deposits and Loans Banking Sector Total Deposits (US$m) Banking Sector Loans to the Private Sector (US$m) Source: Respective Central Banks 42

43. Income Statement – Net Interest Margins 43

44. Income Statement – Opex by Operation 44