Full integrated annual report - African Bank - Investoreports

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Key differentiators Quality of our people Dominant market position Focus on core competence of unsecured lending Strong risk management and collections capability Retail model with direct customer interaction and fast turnaround Low cost operating model High cash generation, high returns, high dividend yield A conservative capital, funding and liquidity management strategy 6 Integrated report 2011 | African Bank Investments Limited A transparent and open culture The courage to face up to shortcomings and address them Committed, passionate, experienced and skilled staff Exposed to highest growth end of credit market The largest provider of consumer fi nance Scale and technical expertise A substantial distribution network across African Bank and EHL Credit risk assumed and all other risks mitigated Business model is kept free of unnecessary complexity Innovation through continuous analysis of data Pricing based on individual customer risk profi le Proprietary, multi-dimensional credit scoring and underwriting models Strong governance and risk management Refi ned collections scorecards, substantial call centre, large, experienced collections team Scoring system allows rapid credit offer and transfer to customer’s bank account Centralised credit underwriting allows swift adjustment for changes in the environment Innovative credit products to banking and retail customers Consistent reduction in cost to assets for past six years Interplay between risk, cost effi ciency and WACC Relationship between cost effi ciency and incremental risk a key value driver for customers Substantial progress in reducing cost base in EHL Highly cash generative business RoE focused Excess capital managed down to minimum, while maintaining high capital adequacy ratio and modest gearing Low volatility business model A positive liquidity gap maintained at all times Duration of liabilities targeted to be higher than the duration of assets 80% of funding portfolio sourced with maturity of greater than 12 months
Shareholders’ snapshot Top fund managers holding/managing ABIL shares Shareholders by geography Manager Holding % Government Employees Pension Fund (PIC) 99 526 321 12,4 JP Morgan Asset Management 81 599 198 10,2 FIL Limited/FMR LLC 41 632 087 5,2 Directors' holdings 40 306 764 5,0 Eyomhlaba Investment Holdings 40 083 465 5,0 2005 2006 2007 2008 2009 2010 2011 Empowerment shareholding (%) 0 1 2 3 4 5 6 7 8 5,1 *Ellerine Holdings Limited was acquired in 2008 Shareholder spread Shares % 1 – 999 3 110 442 0,4 1 000 – 9 999 23 461 374 2,9 10 000 – 99 999 34 606 728 4,3 100 000 – more 742 996 656 92,4 5,8 6,2 * 6,6 6,5 7,1 7,5 Sep 08 Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 Sep 11 For more shareholders’ information, refer to pages 84 to 89 of this report. 55% ABIL shareholders’ profile (%) 0 20 40 60 80 100 35 36 39 38 42 Integrated report 2011 | African Bank Investments Limited 45 45 18% International shareholders Domestic shareholders Shareholder split Shares % Non-public 41 840 785 5,2 Share trust 473 415 0,1 Directors 40 306 764 5,0 Development trust 1 060 606 0,1 Public 762 334 415 94,8 7% 3% 17% South Africa UK Rest of Europe USA and Canada Rest of world 64 64 61 62 58 55 55 7
Page 1 and 2: Integrated report 2011 Giving peopl
Page 3 and 4: Contents ABIL in perspective Page S
Page 5 and 6: Operating structure ABIL is a publi
Page 7 and 8: Our values These are the basic beli
Page 9: Eyomhlaba, ABIL’s fi rst R600 mil
Page 13 and 14: High level risks R1 R2 R3 R4 R5 R6
Page 15 and 16: 2011 2010 Customers Number of custo
Page 17 and 18: Stakeholders’ issues Link to mate
Page 19 and 20: Stakeholders’ issues Link to mate
Page 21 and 22: 2006 2005 2004 2003 Defi nition 1 1
Page 23 and 24: Mojankunyane Florence Gumbi (52) Po
Page 25 and 26: Samuel Sithole (38)* Position Indep
Page 27 and 28: Izincwadi zababambiqhaza Matseno Po
Page 29 and 30: Izincwadi zababambiqhaza tšwetšwa
Page 37 and 38: The selection of issues was informe
Page 39 and 40: Strategic issue covered Risks cover
Page 41 and 42: ABIL manages its regulatory environ
Page 43 and 44: Within the context of further build
Page 45 and 46: experiencing each other’s day-to-
Page 47 and 48: The Bank has made extensive headway
Page 49 and 50: Credit products EHL made good progr
Page 51 and 52: The rollout of this additional dist
Page 53 and 54: Financial review How ABIL generates
Page 55 and 56: Financial review continued Economic
Page 57 and 58: African Bank Investments Limited Co
Page 59 and 60: African Bank Investments Limited Co
Page 61 and 62:
African Bank Investments Limited Gr
Page 63 and 64:
African Bank Investments Limited Co
Page 65 and 66:
African Bank Investments Limited Co
Page 67 and 68:
Banking business unit Results at a
Page 69 and 70:
Retail business unit Results at a g
Page 71 and 72:
Retail business unit Financial stat
Page 73 and 74:
Composition of the board The compos
Page 75 and 76:
Remuneration report This is a conde
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Sign-on bonuses Sign-on bonuses are
Page 79 and 80:
Risk management report This is a co
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Risk management mechanisms ABIL bel
Page 83 and 84:
Mitigation Further detail ABIL cons
Page 85 and 86:
Mitigation Further detail This moni
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Mitigation Further detail ABIL acce
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Listings information Listings excha
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Shareholders’ profi le Top fund m
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Analysis of preference shareholders
Page 95 and 96:
Findings Based on our review of the
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Explanatory note On 1 May 2011, bei
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Percentage of voting rights require
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10. Special resolution 4 - amendmen
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12. Special resolution 6 - amendmen
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Percentage of voting rights require
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16.6 the minimum funding return (al
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c) the issued share capital and res
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19.3 Directions for obtaining a cop
Page 113 and 114:
Jacobus Dorotheus Maria Gerardus In
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Remuneration policy of African Bank
Page 117 and 118:
Annexure to the notice of AGM - Par
Page 119 and 120:
(v) Share capital of ABIL Ordinary
Page 121 and 122:
Application form: electronic partic
Page 123 and 124:
Form of proxy African Bank Investme
Page 125 and 126:
Summary of shareholders rights in r
Page 127 and 128:
This page has been left blank Integ
Page 129 and 130:
Corporate information Board of dire
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Full integrated annual report - African Bank - Investoreports

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