UBS Conference May 2006

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ce

South Africa enjoys a very positive macro

environment

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ceConfidence and growth at all time high!

-5

-3

-1

1

3

5

7

Jan-86 Jan-88 Jan-90 Jan-92 Jan-94 Jan-96 Jan-98 Jan-00 Jan-02 Jan-04 Jan-060

10

20

30

40

50

60

70

80

90

100Real GDP growth (y-o-y) Lhs RMB Business Confidence Index Rhs

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ceReasons for the economic boom

Economic reforms of late 1990’s

Political stability

Fiscal discipline

Effective monetary policy

Emerging Black consumer

Sound institutional framework

Government policy – Go for Growth

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ceStrong evidence of a structural shift

Higher trend GDP growth…with lower volatility

Lower real interest rates...with lower volatility

Lower inflation ...with lower volatility

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ceThe South African ”growth” themes

1. Lower interest rates

2. Emerging Black consumer

3. Black Economic Empowerment (BEE)

4. Infrastructure finance

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ceLower interest rates

Higher asset values

More disposable income

Higher levels of borrowing

Lower levels of bad debts

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ceLower interest rates driving growth in

lending

0

5

10

15

20

25

30

Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06

Prime interest rate

Y-o-y growth in asset backed lending

%

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ceSouth African growth themes

Lower interest rates

Emerging Black consumer

Black Economic Empowerment (BEE)

Infrastructure finance

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ceRising income levels in Black market

0%

10%

20%

30%

40%

50%

60%

70%

1996 2004

SAARF and Unilever Institute

Lower income categories (LSM 1-5)

Higher income categories (LSM 6-10)

• Employment growth • Tax and interest rate cuts

• Economic growth• Employment equity

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ceSouth African growth themes

Lower interest rates

Emerging Black consumer

Black Economic Empowerment (BEE)

Infrastructure finance

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ceValue BEE deals last two years - $17 bn

-

5,000

10,000

15,000

20,000

25,000

Feb-0

4Apr

-04Ju

n-04

Aug-04

Oct-04

Dec-04

Feb-0

5Apr

-05Ju

n-05

Aug-05

Oct-05

Dec-05

$ m

illio

n

Source – RMB internal analysis

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ceSouth African growth themes

Lower interest rates

Emerging Black consumer

Black Economic Empowerment (BEE)

Infrastructure finance

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ceUS$ 67 bn infrastructure spend

anticipated…

Energy

Rail and roads

2010 Soccer World Cup

Schools & hospitals

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ceUS$ 6 bn committed for Public Private

Partnerships (PPP`s)

0

500

1000

1500

2000

2500

2001 2002 2003 2004 2005 2006F 2007F 2008F

$ million

Process Risk

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BRIC…S ?

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How is FirstRand positioned?

Our Business Philosophy

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ceBusiness philosophy

Niche playerJuggernaut

• Focussed

Guerrilla platoon

• Flexible• Talent• Empowered

• Concentrated risk• Small balance sheet• Sub scale

• Bureaucratic

Conventional army

• Slow• Mediocrity• Command and control

• Diversified• Large balance sheet• Scale

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ceBusiness philosophy

Niche playerJuggernaut

The BEST of both worlds!

• Focussed

Guerrilla platoon

• Flexible• Talent• Empowered

• Concentrated risk• Small balance sheet• Sub scale

• Bureaucratic

Conventional army

• Slow• Mediocrity• Command and control

• Diversified• Large balance sheet• Scale

A juggernaut with a niche market mentality

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Chunk into many profit centres, therefore lots

of growth stories

Multi-branding

Centre’s role is not to make decisions, but

rather to facilitate good decision making

Employee centric: consistently at top of “Best

company to work for” survey

Culture shaped by entrepreneurial roots

FirstRand Business Philosophy

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Short-termInsurance

OUTsurance

45%

30%

FirstRand

WesBank

First National Bank

FirstRand Bank

HealthInsurance

LifeInsurance

DiscoveryMomentum

65%100%100%

RMBH

Rand Merchant Bank

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Integrated financial services group

Earnings (June 2005) $1.25bn

Assets under management $80bn

Total advances $37bn

NAV $5.5bn

Market cap $18bn

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Balance sheet Corporate culture

The role of the centreThe role of the centre

Cap

ital

m

anag

emen

t

Bal

ance

shee

tm

anag

emen

t

Ris

k M

anag

emen

t

Innova

tion

Ow

ner

-man

ager

Colla

bora

tion

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Balance sheet Corporate culture

The role of the centreThe role of the centre

Cap

ital

m

anag

emen

t

Bal

ance

shee

tm

anag

emen

t

Ris

k M

anag

emen

t

Innova

tion

Ow

ner

-man

ager

Colla

bora

tion

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ceUtilising a bigger balance sheet

Leverage, credit rating and cost of equity

Rand Merchant Bank A

ssets

$ b

ln

Impact of the balance sheet on leverage

$ 3bn

$ 9bn

$ 18bn

3

6

10

13

16

20

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ce”Top-down” positioning of the

balance sheet

-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

Jan-0

2 - Ju

n-02

Jul-0

2 - D

ec-02

Jan-0

3 - Ju

n-03

Jul-0

3 - D

ec-03

Jan-0

4 - Ju

n-04

Jul-0

4 - D

ec-04

Jan-0

5 - Ju

n-05

Jul-0

5 - D

ec-05

Jan-0

6 - M

ar-06

Yiel

d (%

)

Alpha Overnight Overnight + hedges

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Balance sheet Corporate culture

The role of the centreThe role of the centre

Cap

ital

m

anag

emen

t

Bal

ance

shee

tm

anag

emen

t

Ris

k M

anag

emen

t

Innova

tion

Ow

ner

-man

ager

Colla

bora

tion

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ceCapital – optimise or return?

Capital management principles• Key pillar of our growth strategy

• Mobility of capital

Applying the principles• Capitalise the group to meet targeted credit rating

• Charge business units for the use of capital

• Allocate capital on a portfolio basis to maximiserisk-adjusted returns

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ce 0%

5%

10%

15%

20%

25%

30%

2001 2002 2003 2004 2005

Return on Equity Cost of Equity

Obsession with ROE

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How well are we positioned to exploit

growth themes?

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ceAll our businesses are well positioned

Lower interest

rates

Infrastructure finance

BEE transactions

Emerging Black

consumer

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ceAll our businesses well positioned

Rated no.1 Investment Bank in South Africa

PBT $313m

• Structured &Project Finance• Mergers & Acquisitions• Securities Trading• Private Equity • Asset Management ($30 bln)

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Major source of business for investment bank RMB

RMB well positioned for BEE

BEEBEE

Private Equity Corporate Finance

Structured Finance

• Investment • Advisory• Equity Raising

• Structuring• Lending

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ceHow does RMB make money from

infrastructure finance?

Participation Advisory Arranging &

Underwriting

Equity /

Sponsorship

RMB Positioning

Opportunity to acquire assets

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ceRMB strongly positioned

8610Grand total

001Accommodation

112Prisons

111Hospitals

111Power stations

535Toll roads

Deals in which RMB has

participated

Deals led by RMB

Total number of

deals

RMB has dominated the PPP market

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ceAll our businesses well positioned

Most innovative commercial bank in South Africa

PBT $682m

Mass marketHigh networthCompanies / Government5 million customers704 branches4535 ATMs

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ceLower interest rates drive borrowing

Asset values• Rising Asset and Property values – increase

loan amounts• Improve security esp the “in force book”

Higher levels of borrowing• Advances +26% to June 2005• Growth in all Retail markets

Lower levels of bad debts

UBS

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ceInnovation - key to capture emerging

Black consumer

Using low cost distribution channels• Mini ATMs• Cell phone banking

Products• Affordable housing• Pension-backed Home Loans• Micro loans• Mzansi account – low cost account for

mass market• InContact – sms confirmation

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ceAll our businesses well positioned

1 in 3 cars financed by Wesbank in South Africa

PBT $231m

• Dominates Point of Sale

• JV with 5 of 10 motor manufacturers

• Originates in over 30 JV brands

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%

Forecast 40% ”Black book” by 2010

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1998 2005 2010F

White Black

WESBANK book

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ceAll our businesses well positioned

Rated no.1 provider of investment products

PBT $158m

• Investment Products

• Risk Products

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ceMOMENTUM`S Growth strategy

Attacking the fast growing middle market

Adding load to distribution• Short-term insurance• Health

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ceAll our businesses well positioned

Fastest growing short-term insurer in South Africa

PBT $62m

• Auto

• Homeowners & Householders

• Small Commercial

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ceOUTsurance’s winning recipe

Most recognised short-term insurance brand in South Africa after only 8 years

Differentiates itself with the OUTbonus

“Direct’’ distribution model

World class actuarial risk modeling

Exportable value proposition

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ceAll our businesses well positioned

No.1 health insurance group in South Africa

PBT $147m

Health plus life insuranceVitality loyalty schemeDestiny in the USJV with Prudential in the UK

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ceAfter 13 years, as big as the rest

combined

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

Discovery Top 10

Total scheme membership

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ceFirstRand’s international strategy

At divisional level vs group level

Divisions expand geographically in different markets

Only expand if there’s a clear competitive advantage

Africa a focus ($100m PBT), but also other emerging markets

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ce

What have we delivered to shareholders?

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ceSuperior value creation

Economic Profit

-500

1,0001,5002,0002,5003,0003,5004,0004,500

2000 2001 2002 2003 2004 2005

• Compound annual growth rate - 45% (SA Rand)

• Adjusted for constant cost of equity - 26%*

*COE held constant at 19%

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ceConclusion

Expect boom to last until 2010

FirstRand units focused in growing niches

Business philosophy empowers divisions –many growth stories

FirstRand uses centre/”bigness” to enhance performance

Is big better? YES, if you have a niche market mentality!