1

Personal & Business Banking SA – Analyst day

18 August 2008

2

Agenda

● Economic outlook

● Financial Highlights

● Strategy of PBB

● Looking ahead

● Questions

Start one-on-one meetings

2

3

Macro economic environment in SA in 2008

● GDP ?

● Inflation ?

● Interest rates ?

● Food and fuel price ?

● Steady formal sector labour market ?

4

Trading conditions in SA

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Mar

-08

Dec

-07

Sep

-07

Jun-

07M

ar-0

7D

ec-0

6S

ep-0

6Ju

n-06

Mar

-06

Dec

-05

Sep

-05

Jun-

05M

ar-0

5D

ec-0

4S

ep-0

4Ju

n-04

Mar

-04

Dec

-03

Sep

-03

Jun-

03M

ar-0

3D

ec-0

2S

ep-0

2Ju

n-02

Mar

-02

02468

101214161820

Spending by households Disposable income of householdsFixed investment spending (RHS)

% yoy

% yoy

3

5

-6

-4

-2

0

2

4

6

8

10

12

14

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

%y/y

SA retail sales

In June 2008, retail sales fell by 2.6%y/y in real terms. Retail sales declining noticeably

6

14000

16000

18000

20000

22000

24000

26000

28000

30000

32000

34000

36000

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

Rm, constant 2000 prices

SA retail sales (seasonal cycle)

Retail sales are extremely seasonal

4

7

-45

-35

-25

-15

-5

5

15

25

35

45

55

92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08

12-month moving average

%y/y

SA passenger vehicle sales

Passenger vehicle sales declined by 19% y/y in July

8

Standard Bank - median property prices

-20.00

-10.00

0.00

10.00

20.00

30.00

40.00

Jan-0

0

May-00

Sep-00

Jan-0

1

May-01

Sep-01

Jan-0

2

May-02

Sep-02

Jan-0

3

May-03

Sep-03

Jan-0

4

May-04

Sep-04

Jan-0

5

May-05

Sep-05

Jan-0

6

May-06

Sep-06

Jan-0

7

May-07

Sep-07

Jan-0

8

May-08%

5

9

Challenges foreseen in South Africa

● Consumer affordability

● Pressure on pricing of term funding

● Competition Commission

● Legacy Banking Systems

10

Financial highlights

17 029

25 415

299 959

2 472

11 066

June 2007

10

3

17

(7)

20

Change %

18 23118 768 Ave ordinary shareholders equity

26 37826 072Number of Employees

332 758352 052Total assets Rm

5 2692 300Headline earnings Rm

23 733 13 274Total income Rm

Dec 2007June 2008

6

11

Moderate levels of customer activity

● Retail sales down 4% y/y in May

● Value of new HL business registered down 28%

● Value of new loans in motor book down 32%

● Number of current accounts up 10%

● Number of other transaction and savings accounts up 4%

● Branch based transaction volumes– Teller volumes up 3%– Enquiry volumes up 1%

● Call centre volumes up 4%

● Internet users up 19%

● Cash growth up 14%

● ATM volumes down 2%

12

Current structure

Jacko MareeChief Executive

SBG

Bob Tucker

Customer Strategy

Leon BarnardProducts

Peter Wharton-Hood

Chief Operating OfficerSBG

Darrel OrsmondBusiness

Architecture

Peter Schlebusch

CEPBB SBSA

LincolnMali

Customer Channels

David Munro

CECIB SBSA

Sim TshabalalaChief Executive

SBSA

Johan van SchalkwykBusiness

Operations

Wally Fisher

HR

FunekaNtombelaPBB CFO

Terry Moodley& Keith Fuller

Credit

Rob Katz Bancassurance

Richard IrvineGlobal Chief Operating

Officer

7

13

Strategy

● Service

● Engaging people

● Focus on Transactional and savings accounts

● Employ suitable pricing and margin management strategies

● Sensible cost management

14

Inspired. Motivated. Involved people

● Successful in talent retention and continued positive progress on transformation targets

● Maintained investment in key IT initiatives

● Continued progress in bedding down Basel II related processes

● Successful graduate development programmes

● Focus on learning and development for staff

● Continue with Global Leadership programmes

8

15

Sensible cost management

● Total costs increased below inflation● Staff costs up 6%

– Managerial appointments effectively halted – January– Complete freeze on external recruitment – April– Active management of temporary workforce and labour broker– Robust management of poor performance

● Other operating expenses up 6%– Some cost pressures have increased

• Infrastructure and premises • Operational risk losses • ATM bombings• Alternative power supplies• Industrial action

● Cost-to-income ratio below 45% for 1H08

16

Outlook

● Significant forecast risk currently exists

● Inflationary pressures still evident

● High interest rates hurting

● Pressure on disposable income, discretionary spending

● Expected recovery in personal disposable income and discretionary spend only in Q4 2009

● Continued pressure on formal employment

● Positive growth in top end Business Banking

● Making the most of challenging times to optimally position PBB for growth in inevitably improving economic conditions

● Part of PBB Global with promising growth prospects in new markets e.g. Nigeria, Kenya and Argentina

9

17

Questions