International Operations & Strategy

Derek MullerExecutive Director

International Banking Strategy• Sustainable businesses in which we have core competencies

• Customer Driven e.g. trade and project finance

• Working with Old Mutual

• Low Risk approach in Africa

• Commercialisation of Technology and Operations

• No major changes with integration of BoE.

• No intention to do retail banking in developed markets. Limited retail in neighboring countries.

• No international investment banking aspirations.

Nedcor Offshore Structure

Singapore Branch

• Correspondent Banking

• Trade Finance

• Origination (Forfaiting)

• Private Banking

Hong Kong branch

• Treasury

• Corporate Banking

• Private Banking

• Origination (Forfaiting)

• Trade Finance

• Structured Trade Finance

Taipei Rep Office

• Correspondent Banking

• Private Banking

Jersey, GeurnseyIsle of Man

• Gerrard Private Bank

• Fairbairn Trust

• BoE / Stenham

London Branch

• Treasury

• Corporate Banking

• Private Banking

• Forfaiting (Risk)

• Trade Finance

• Structured Trade Finance

Nedbank Trade Services (Mauritius)

• Trade Finance

• Structured Trade Finance

Beijing Rep Office

• Correspondent Banking

• Trade Finance

Nedcor Africa Structure

MBCA

SBM

BanqueSBM

Lesotho

Swaziland

FINCOM

Commercial Bank of Namibia

Old Mutual have an option to increase their shareholding to 51% .

Brand licence agreement with Gerrard Ltd U.K.

Old Mutual plc

Gerrard Limited

Gerrard Private Bank(Jersey) Ltd

Nedcor Limited

Old Mutual InternationalHoldings Ltd. (Bermuda)

52.4% 100%

75% 25%

100%

Gerrard Trust(Jersey) Ltd

Fairbairn TrustCo. Ltd

Gerrard Private Bank(IoM) Ltd

Gerrard Private Bank

Strategic Rationale for Joint Ownership

• It provides an opportunity, outside South Africa, for Old Mutual and Nedcor to develop their relationship.

• Draws on the complementary strengths of both shareholders in the asset and risk management areas.

• It provides further hard currency earnings for Nedcor.

• Obviates overlap in the HNW market.

• Maximises the skill transfer synergies between the group.

Gerrard Private Bank

• Strategy:

• Work the Gerrard client base.

• Expand South African client base

• Recently rated internationally A2P1 by Moodys

• Award winning products and services

• Launched in South Africa via Representative Office September 02

• Subject to regulatory approval will open a Representative Office in Hong Kong 4th quarter 02

• Plans to remain a full international Private Bank not an Anglo/South African offering

Gerrard Private Bank

• BoE in the Isle of Man (RSA focussed)

• Stenham Gestinor (SG) has a presence in Guernsey (RSA focussed), Luxembourg (Company Admin) and Switzerland (European focussed), with smaller offices in Panama, BVI, Netherlands. SG Trade Finance.

• Chiswell Assoc. - Asset Management (focus on charity funds)

 

BoE

NIB offshore

• Multimanager (NIBi)– IoM and London– Targets: Individuals and institutions both domestic and

international• Treasury structured products

– London– Targets: SA corporates offshore, asset managers and own

account

Nedcor Africa StructureNEDCOR AFRICA

Trade &Commodity

Finance

Term &ProjectFinance

NedbankLesotho

NedbankSwaziland

FincomMalawi

MBCAZimbabwe

SBMMauritius

Banque SBMMadagascar

SBM Nedbank International

Commercial Bankof Namibia

Equator

Africa Strategy• Not “one size fits all”

• Limited investment of capital

• Physical Presence– Low-risk (limited retail branch network)– Low capital initiatives– SADC and Countries contiguous to RSA

• Work with South Africa Corporate and Commercial clients

• Structuring capability centred in Johannesburg and London:– Trade & Commodity– Project Finance

Africa Strategy

• Aplitec Strategy in Africa (Aplitec held 29% by Nedcor)

• Supportive of NEPAD

• Alliances

– BNP Paribas

– HSBC

– State Bank of Mauritius

African Project Finance

• Risk mitigation via ECIC

• Ability to assess and take commercial risk

• Ability to manage risks

• Professional experienced team• Debt and equity provider for limited recourse finance projects in

SADC• Sourcing and implementation of structured, corporate and limited

recourse finance transactions in Namibia

Commercialisation of Technology & Operations• Assessed as being globally competitive in the application of

process and information technology to improve productivity• Precedents exist for successfully commercialised transaction

service providers• Viable opportunity for a commercial entity supplying services

both locally and internationally• Volume solution to increasing technology spend required to

remain in a pre-eminent position• Differentiated model to unlock shareholder value in medium

term• Need 4 – 5 Swisscard type contracts to be material

Asia

• Have been in Hong Kong since 1984.

• Successful track record, other than 1997 meltdown.

• Continue to look for expansion opportunities in trade finance.

• Singapore trade finance.

• Representative offices have been disappointing.

• Private banking with Old Mutual.

Sources of core earnings

82%

2%

6%

10%

18%SAUK AfricaOther

The ROE was 12,8% for the six month period ended 30 June 2002.

The shape of Nedcor offshore• Total assets R50,6bn (26%)

• Total advances R32,8bn (22%)

• Shareholders’ funds R5,1bn (32%)

• Contribution of 17% of core earnings

• ROE 11% (25% including translation gains)

31 December 2001

Questions?