Overview

Consumer environment

• Lower economic activity

• New retrenchment claims down from 12 600 (Aug 09) peak to 8 500 (Jan 10)

• Stability in the EHL operating environment

Strategic countermeasures

• Client acquisition strategies

• Cost reduction programmes

• Financial Services integration

• Focus on improving cost of funding

• Signs of new value propositions starting to have an effect

• Cautious relaxation of underwriting and risk mix

Overview of the African BankAfrican Bank

Sales

• African Bank’s underwriting appetite remained cautious

• Subdued sales of R2.6 billion (2009: R3.0 billion) as a result

• Tactical shift to lower risk customers

• Increased credit card penetration

200

300

400

500

600

700

800

900

1 000

1 100

1 200

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

R m

illio

n

Sales of new loans

2009 2010

250

270

290

310

330

350

370

390

410

430

450

3 500

4 000

4 500

5 000

5 500

6 000

6 500

7 000

7 500

8 000

Dec

05

Mar

06

Jun

06

Sep

06

Dec

06

Mar

07

Jun

07

Sep

07

Dec

07

Mar

08

Jun

08

Sep

08

Dec

08

Mar

09

Jun

'09

Sep

09

Dec

09

Quarterly sale of new loans

Average loan size (LHS) No of Loans 000's (RHS)

Sales mix

• Further shift to medium and low risk

customers in quarter

• Average loan size up 11%

to R7 600 (2009: R6 700)

• Average term 39 months

(2009: 33 months)

• Going forward, stabilising conditions allow

mix relaxation towards higher risk

17%

39%

44%

13%

45%

42%

Capital distribution

High Medium Low

Dec 08

Dec 09

Advances

• Advances growth currently tracking behind expectation

• Quarterly growth of 4% and annualised growth of 17% to R22 billion

0

5

10

15

20

25

30

35

40

45

5

7

9

11

13

15

17

19

21

23

Ja

n-0

5

Ma

r-0

5

Ma

y-0

5

Ju

l-0

5

Se

p-0

5

Nov-0

5

Ja

n-0

6

Ma

r-0

6

Ma

y-0

6

Ju

l-0

6

Se

p-0

6

Nov-0

6

Ja

n-0

7

Ma

r-0

7

Ma

y-0

7

Ju

l-0

7

Se

p-0

7

Nov-0

7

Ja

n-0

8

Ma

r-0

8

Ma

y-0

8

Ju

l-0

8

Se

p-0

8

Nov-0

8

Ja

n-0

9

Ma

r-0

9

Ma

y-0

9

Ju

l-0

9

Se

p-0

9

Nov-0

9

Month

s

R b

illio

n

Monthly advances growth

Advances Average term of new sales

Asset quality

0%

5%

10%

15%

20%

25%

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Outs

tandin

g R

epayable

of

NP

L

over

Tota

l O

rigin

al R

epayab

le

Month on Book

VINTAGE GRAPH - African Bank - Focused view More than three missed instalments

Sep-07 Oct-07 Nov-07 Dec-07 Jan-08 Feb-08 Mar-08 Apr-08

May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08

Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09

• Recent vintages tracking in the centre of historic underwriting range

• Bad debt charge peaked at end of FY2009

Ellerines

Retail

• Retail re-engineering starting to bear fruit

• Ellerines MP1 negatively affected Savells Fairdeal

• Retail margins firm

• Costs continue to decline

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

Oct

Nov

Dec

Jan

Fe

b

Ma

r

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

EHL sales variance y-o-y

Credit Sales Total Sales Like for Like Total Sales

1%

20%

-6%

22%

-16%

22%

5%6%

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

Ellerines Beares Furniture City

Geen & Richards

Wetherlys Dial-a-Bed Total

Comparable sales growth

L-f-l growth Savells impact

Retail (continued)

• Productivity dials improving steadily

• Sales per m² of R1 912 (Q1 2009: R1 769)

• Sales per store of R1.3m (Q1 2009: R1.2m)

• Sales per employee of R105 000 (Q1 2009: R89 000)

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

EHL productivity variance y-on-y

Avg Sales per Store

Sales per Employee

Sales per Sqm

FY09-FY08 FY10-FY09

Financial services

• Financial services integration on track

• Credit sales grew by 7% relative to 2009

• Credit sales mix improved from 57% to 61%

• Advances lifted by 9%

• Interest suspension and in duplum limitations impacting yields

0

500

1000

1500

2000

2500

3000

3500

4000

Ellerines Beares Furniture City Geen & Richards

Advances

Dec 08 Sep 09 Dec 09

75%

60%

44%

57% 57%

76%70%

53%

62% 61%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Ellerines Beares Furniture City

Geen & Richards

Total

Credit sales %

Dec 08 Dec 09

Asset quality

• Asset quality continued to improve

• Vintages tracking the lower end of the underwriting range

0%

5%

10%

15%

20%

25%

30%

35%

40%

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

Outs

tandin

g R

epayable

of

NP

L o

ver

Tota

l O

rigin

al R

epayab

le

Vintage graph – Ellerines Holdings - Focused viewMore than three missed instalments

200711 200712 200801 200802 200803 200804 200805 200806200807 200808 200809 200810 200811 200812 200901 200902200903 200904 200905 200906 200907 200908