Standardbank Cover.indd - Standard Bank - Investor Relations
Standardbank Cover.indd - Standard Bank - Investor Relations
Standardbank Cover.indd - Standard Bank - Investor Relations
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<strong>Standard</strong> <strong>Bank</strong> Group Analysis of financial results for the year ended 31 December 2012<br />
• Perpetual preference shares issued by SBG for the purposes of<br />
financing the transaction are classified as equity. Dividends<br />
paid on the perpetual preference shares are accounted on<br />
declaration and not on an accrual basis.<br />
The normalised adjustment:<br />
• recognises a loan asset by reversing the elimination of the<br />
redeemable preference shares against equity<br />
• accrues for preference dividends receivable on the loan asset<br />
within interest income<br />
• adds back the number of shares held by the black participants<br />
to the weighted number of shares in issue, for purposes of<br />
calculating normalised per share ratios<br />
• adjusts dividends declared on perpetual preference shares to<br />
an accrual basis.<br />
In December 2007, the group obtained financing, external to SBG,<br />
for a portion of the financing provided to the SPEs. As a result, the<br />
negative empowerment reserve was reduced by the value of the<br />
external financing obtained of R1 billion, and a proportion of the<br />
SBG shares held by the SPEs (24,7 million shares) are no longer<br />
deemed to be treasury shares for accounting purposes.<br />
In March 2008, 11.1% of the Tutuwa participants’ shares were sold<br />
to the ICBC with the proceeds being partly utilised for the repayment<br />
of their preference share liability, thereby releasing a further<br />
11,0 million ordinary shares previously deemed by IFRS to be<br />
treasury shares.<br />
Group shares held for the benefit of policyholders or<br />
to facilitate client trading activities<br />
The group acquires or sells short shares in SBG for two distinct<br />
business reasons:<br />
• Group companies’ shares held by Liberty are invested for the<br />
risk and reward of its policyholders, not its shareholders, and<br />
consequently the group’s shareholders are exposed to an<br />
insignificant portion of the fair value changes on these shares.<br />
• The group enters into transactions in its own shares to<br />
facilitate client trading activities. As part of its normal trading<br />
operations, the group offers clients trading positions over<br />
listed shares, including its own shares. In order to hedge the<br />
risk on these trades, the group buys or sells short its own<br />
shares in the market. The group’s shareholders are therefore<br />
exposed to an insignificant portion of the fair value changes on<br />
these shares.<br />
Group shares held for the benefit of policyholders or to facilitate client trading activities<br />
Policyholders’ liabilities and client<br />
trading positions relating to SBG<br />
shares recognised in full<br />
SBG<br />
Cost of SBG shares deducted/added<br />
from/to equity in terms of IFRS.<br />
Fair value movements in the SBG<br />
share price, including dividends, are<br />
not recognised in the IFRS income<br />
statement<br />
SBG subsidiaries<br />
Client transactions<br />
Policyholders’ benefits offered to<br />
clients<br />
Exposure to client transactions<br />
Liberty<br />
Liability to policyholders linked to<br />
returns on portfolios that include<br />
SBG shares<br />
Offsetting transaction resulting<br />
in position in SBG shares<br />
Investment in a portfolio of shares,<br />
including SBG shares, on behalf<br />
of policyholders<br />
Financial instruments offered<br />
to clients linked to a share price<br />
or index<br />
Subsidiaries in banking operations<br />
Exposure to movements in share<br />
price or index resulting from client<br />
trading activities<br />
Investment in shares that offset<br />
client trading positions, including<br />
SBG shares sold short or held long<br />
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