1 Innovative Thinking in Retail Banking Investor Pre - Roadshow Presentation April 2008.

1

Innovative Thinkingin Retail Banking

Investor Pre - Roadshow Presentation April 2008

2

Individuals

in need of

basic low cost banking

Our Focus

3

We deliver on four core needs:

• Accessibility

• Affordability

• Simplicity

• Personal Service

3

4

The Unique Business Model

Unique / Innovative Technology

Simplified / Focused Product Range

Branches Mobile Bank

ATM POS

INTERNET CAD CELL

Providing

Customer Focused – Low Cost Delivery Channels

Annuity Transactions

Via

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5

The Capitec Bank RevolutionOur Technology Platform

•Features• Paperless• Process Driven• Real Time Delivery• Cashless• Central Control – no branch back office• Handle high volume transactions efficiently

•Structure• Open Platform• Windows-based• Scaleable

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6

Simplified Focused Product Offer- Structure

Transactions

• Purchases

• Transfers

• Debit orders

• Stop orders

Multi loan

1 / 3 / 6 month loans

12 / 18 / 24 / 36 month term loans

Cash Wallet

Savings Account

Focus Save Accounts

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Simplified Focused Product Offer- Price

Savings and Transactions

• Aggressive

Loans

• Competitive

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8

Our People

• Cultural alignment

• Service driven

• Recruit for potential, train for skill

• Team approach

• Zero to hero in 7 weeks Firm Foundations

• Ongoing investment in competency E Learning

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The MarketAverage Income Spread

LSM Number

(People million)Income %

1 2.1 R 0 – R 947 7

2 3.8 R 949 – R 1 179 12

3 3.8 R 1 179 – R 1 443 13

4 4.5 R 1 443 – R 1 977 15

5 4.1 R 1 977 – R 2 549 13

6 4.3 R 2 549 – R 4 366 14

7 2.3 R 4 366 – R 6 659 8

8 1.7 R 6 659 – R 9 388 6

9 1.9 R 9 388 – R12 077 6

10 1.7 R12 077 – R19 298 6* Household Income after statutory deductions

Target Market

17m

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10

Client Base

02/07 02/08

Salary clients only 78 368 158 005

Loan clients only 236 092 348 966

Loan & salary clients 132 712 170 922

Sub-total 447 172 677 893

Savings clients 563 107 693 283

Total 1 010 279 1 371 176

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Salary ClientsAge

2.906.58

15.74

5.73

41.83

27.23

-

5

10

15

20

25

30

35

40

45

18 - 20 21 - 30 31 - 40 41 - 50 51 - 60 61+

%

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12

Loan ClientsAge

-

5

10

15

20

25

30

35

40

18

- 20

21

- 30

31

- 40

41

- 50

51

- 60

60

+

%

Male Female

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13

Loan ClientsIncome Level

-

5

10

15

20

25

30

R1- R

999

R1000 - R

1999

R2000 - R

2999

R3000 - R

3999

R4000 - R

4999

R5000 - R

7499

R7500 - R

9990

R10000 -14999

R15000+

No P

rediction

% Male

Female

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History

1. Microlending

2. Bank (2000/1)- Management team

- Determining strategy- Bank licence- PASA membership- IT platform

3. Conversion- Microlending to bank

- Deposit taking- Client conversion to bank with Capitec

4. Growth Strategy14

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Group & Operations Structure

100% 100%75%

PSG Group 34.9%

Management 8.79%

Non-ex directors

(excl black directors) 15.79%

BEE groups & individuals

15.99%

Other

24.53%

CAPITEC BANK HOLDINGS (CBHL)

Listed and registered as a bank controlling

company

Capitec Bank (Retail bank)

Key Distributors (FMCG wholesaler)

Other (No activity)

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Management

• CEO

Riaan Stassen (54)

• CFOAndre du Plessis (46)

• Other Executives:

- IT Chris Oosthuizen (53)

- Risk Christian van Schalkwyk (52)- Human Resources Leon Venter (46)- Operations/Sales Gerrie Fourie (44)- Marketing & Corporate Affairs Carl Fischer (51)- Credit Risk Jaco Carstens (39)

Ian Abrahams (39)- Card Services & Business

Support Andre Olivier (40)Faick Davids (31)

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Employment Equity Profile

Target 2004 2008

Senior Management 20% 8% 11%

Middle management 30% 15% 25%

Junior Management 40% 18% 50%

Rest 82% 81% 93%

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Key Risks and Mitigants

• Credit

• Liquidity

• Regulatory

• Systems

• Interest rate

• Taxation

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Liquidity Management

• Caution : top priority (even over profitability)

• Retail deposits - payout when requested

- cash usage

- short term loans

• Facilities - don't bank on it

- used for convenience

• Fixed vs fluctuating rates

• Forex - cover all positions

- no appetite

• Simplicity / no complex structures

- Banking Crisis 2000/1- Philosophy

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Liquidity - History

• Initial strategy – Self funding

• Build trust – Retail savings deposit base

• Wholesale funding agreements

• Un-published ratings

• Preference shares

• Published ratings

• BBEE

• Short term corporate paper

• DMTN

• Retail term deposit base

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Basel II – Pillar 1 Minimum Regulatory Capital Requirement

Basel I Feb 2007

Dec 2007

79%

51%

Basel II (BIA) Dec 2007

Feb 2008

37%

36%

Basel II (ASA) Feb 2008 58%

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Basel II – Pillar 2 The Supervisory Review Process

• Supervisory Review and Evaluation Process (SREP)

• Risk Management

• Capital Management

• Capitec Internal Capital Assessment Process (CICAAP)

• Foundation Internal Ratings Based approach (FIRB) for credit risk

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Basel II – Pillar 3Market Discipline

• Regulation 43 Public disclosures

• Quarterly, Bi-annual and Annual disclosures

• Dedicated Website Page under Investor relations

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National Credit Act (NCA)

Act

• Income components & ceilings

• Procedures, rules & output

• Debt counseling & mediation

VAT leakage

Opportunity

Strategy (pre-empting effect)

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Financial Highlights

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Holdings vs Bank results

- IFRS

Holdings :

Equity settled in Statement of Changes in Shareholders Equity

Bank :

Cash settled through Income Statement

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Loans Advanced

1,4771,904

2,2592,863

3,449

5,162

0

1,500

3,000

4,500

6,000

2003 2004 2005 2006 2007 2008

Rm

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Number of Loans Advanced

24542617

2486 26502924

3155

0

500

1000

1500

2000

2500

3000

3500

2003 2004 2005 2006 2007 2008

'000

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Loans advanced per product

R’m 2007 % 2008 %

1 Month 1600 46 1 692 33

3 Month 687 20 757 15

6 Month 392 11 314 6

12 Month 425 12 797 15

18 Month 190 6 430 8

24 Month 155 5 774 15

36 Month - 398 8

3 449 5 162

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Impairment per product

% 1

Month

3

Month

6

Month

12 Month

18 Month

24 Month

36 Month

2008 1.05 3.83 5.14 10.18 12.99 15.78 29.37

2007 1.61 3.16 6.85 13.13 24.30 21.65 -

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Net Transaction Fee Income

00 4

15

35

79

0

10

20

30

40

50

60

70

80

90

2003 2004 2005 2006 2007 2008

R'm

31

32

Value of Savings Deposits

04 74

314

554

838

0

100

200

300

400

500

600

700

800

900

2003 2004 2005 2006 2007 2008

R'm

32

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Operations

34

Bank Branches

44

148

251 253280

331

0

100

200

300

400

2003 2004 2005 2006 2007 2008

Number

34

35

ATMs

5875

180 210

407

765

0

100

200

300

400

500

600

700

800

2003 2004 2005 2006 2007 2008

No

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Employees

1,180

1,4021,708

1,9012,129

2,800

1,000

1,500

2,000

2,500

3,000

2003 2004 2005 2006 2007 2008

No

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Profitability

38

Headline Earnings

3047

70

116

160

212

0

50

100

150

200

250

2003 2004 2005 2006 2007 2008

R'm

38

39

Headline Earnings per Share

4570

101

165

222

259

0

50

100

150

200

250

300

2003 2004 2005 2006 2007 2008

Cents

39

40

Return on Equity

8

12

16

23

26

22

0

10

20

30

2003 2004 2005 2006 2007 2008

%

40

41

Cost to Income Ratio

77 76 7466 60

58

0

50

100

2003 2004 2005 2006 2007 2008

%

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Shareholder Funds

384 426 473564

1,1171,217

0

300

600

900

1200

2003 2004 2005 2006 2007 2008

R'm

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Market Capitalisation

164399

1,072

2,233

3,0313,195

0

500

1000

1500

2000

2500

3000

3500

4000

2003 2004 2005 2006 2007 2008

R'm

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Total Assets

434512

805

1,251

2,191

2,937

0

500

1000

1500

2000

2500

3000

2003 2004 2005 2006 2007 2008

R'm

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Going Forward

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Going forwardInvestment • Distribution

- +25 Branches

- +75 Mobile Banks- +50 ATMs- +2 250 POS devices

• Technology- Branch Streamlining

Challenges• Cash-plastic• Economy• Competitors• Funding• Crime

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Thank You

Questions ?