7 th Annual Governance (ESG) roadshow Vassi Naidoo (Chairman), Mpho Makwana (LID), Errol Kruger (Independent Director) May 2020 1 NEDBANK GROUP LIMITED – May 2020
ESG DURING THE COVID-19 PANDEMIC 2 NEDBANK GROUP LIMITED – May 2020
Governance – Nedbank’s response to the Covid -19 pandemic Nedbank Board call every 2 weeks plus regular contact with the Chairman of the Board & Chairpersons of Board sub-committees to keep them suitably informed & consult them for input on key decisions Group Executive Steering Committee Oversees Nedbank’s actions & management of the unfolding risks Covid-19 Pandemic Liquidity Credit Steering Committee Steering Committee Steering Committee Staff & operational Manage credit risks Maintain a strong liquidity profile matters & client support 3 NEDBANK GROUP LIMITED – May 2020
Strategic tilt – Nedbank’s response to the Covid -19 pandemic Primary focus on the health & safety of our staff, continuing to serve our clients as banking is an essential service & supporting clients as they manage their finances through this difficult period Current focus Transitional focus Future focus Pivot our strategy to increase Planning how we focus on: Strategise for reintegrated staff & ▪ managing liquidity, capital, ‘the new normal’, business functions in a market & credit risk competitive advantage phased manner ▪ scenario modelling & (in line with government & grow the business stress testing guidelines) ▪ optimising costs 2020 financial guidance withdrawn & MLT targets under review 4 NEDBANK GROUP LIMITED – May 2020
Risk management – Nedbank’s response to the Covid -19 pandemic Climate risks previously managed but explicitly in the group’s top 10 risks 5 NEDBANK GROUP LIMITED – May 2020
Risk management – Nedbank’s response to the Covid -19 pandemic Business, people, Liquidity & capital risk Credit risk operational & cyber risk Oversight – Board, DAC, GTSEC, Oversight – Board, GAC, Oversight – Board, GCC, GAC, GITCO, GRCMC GRCMC, REMCO GRCMC ▪ ▪ ▪ Ensure adherence to national Ensure compliance with Ensure compliance with directives & regulations regulatory requirements regulatory requirements & during lockdown oversee implementation of ▪ Oversee implementation of SARB directives ▪ Oversee focus on the health & SARB directives ▪ safety of our staff Oversee IFRS 9 model ▪ Maintain strong liquidity & revisions & accounting ▪ Oversee business continuity capital metrics changes plans & effective operations ▪ Board to apply its mind to ▪ Oversee management of ▪ Ensure IT system stability/ SARB GN4 on future cash heightened credit risk availability & heightened focus dividends & cash bonuses ▪ on cyber security to certain executives Ensure adequacy of provisioning ▪ ▪ Ensure support of the greater Oversee scenario planning & ▪ social need stress testing Oversee scenario planning & stress testing ▪ ▪ Oversee strategic tilt Oversee ETI related risk ▪ Ensure clients are treated fairly (conduct) 6 NEDBANK GROUP LIMITED – May 2020
Employees & operations – Nedbank’s response to the Covid -19 pandemic ▪ Primary focus on the health & safety of our staff – social distancing, sanitation & health practices, emotional wellbeing etc ▪ Activated BCPs 1 , tailored for initial 35-day lockdown & risk adjusted release ▪ > 80% of SA campus staff enabled to work from home ▪ Critical functions at offices – split teams, offices, floors ▪ 63% (304) of branches remain open , 95 temporarily closed branches designated as call centres & client retention sites ▪ Excellent system stability , above 2019 levels (>99.1%) ▪ Increased capacity of staff & clients to work & bank remotely ▪ Increased focus on cyber security 1 Business Continuity Planning 7 NEDBANK GROUP LIMITED – May 2020
Clients – Nedbank’s response to the Covid -19 pandemic ▪ Enable & educate our clients to increasingly bank through our mobile & web capabilities ▪ Support for CIB, RBB, NPW & NAR clients . Examples include: ‒ RBB payment holidays ‒ Card minimum monthly repayment reduced from 5% to 2,5% ‒ PL clients can opt for debt relief under credit life insurance ‒ Insurance cover including death, disability, retrenchment & inability to earn an income ‒ HL clients can access equity by applying for re-advance ‒ BB temporary increases in overdrafts facilities for franchise & hospitality industries ‒ CIB clients given interest payment deferrals or extending additional credit to manage short term cashflow shortfalls ▪ Support spaza shops & general dealers – procurement cards, discounted prices for pre-approved goods etc 8 NEDBANK GROUP LIMITED – May 2020
Society – Nedbank’s response to the Covid -19 pandemic ▪ Nedbank staff pledge ▪ Waived ATM charges & Saswitch fees for SASSA grant beneficiaries during the current lockdown ▪ Enabled staff & clients to contribute to Solidarity Fund through the Nedbank app, web & internet banking ▪ One of four banks to administer the R1bn SA Future Trust ▪ SME Loan Guarantee Scheme currently being finalised ▪ Donating R12m to Covid-19 relief efforts including Red Cross ▪ Numerous health & economic interventions through BASA, BLSA & BUSA/ Business for SA 9 NEDBANK GROUP LIMITED – May 2020
UPDATE ON BOARD MATTERS 10 NEDBANK GROUP LIMITED – May 2020
Governance – Nedbank board members Changes to the board New appointments ▪ Prof Tshilidzi Marwala (Expertise in innovation, digital, IT & cyber resilience) Retired 1 / Resigned 2 ▪ Malcolm Wyman 1 (2019) ▪ Peter Moyo 2 (2020) Retiring 22 May 2020 ▪ Joel Netshitenzhe 11 NEDBANK GROUP LIMITED – May 2020
Governance – board independence, demographics, tenor, skills & experience 12 NEDBANK GROUP LIMITED – May 2020
Governance – Nedbank Group Executive GROUP EXECUTIVE COMMITTEE Exco member since 17 Exco members since Exco member since June 2004 – appointed CE 1 September 2009 1 December 2008 (“GROUP EXCO”) March 2010 10 years’ service at 15 years’ service at 26 years’ service at Nedbank Nedbank Nedbank Raisibe Morathi 50 Mfundo Nkuhlu 53 Mike Brown 53 Chief Financial Officer Chief Executive Chief Operating Officer Exco member since Exco member since Exco member since Exco member since Exco member since April 2020. 2010 1 May 2015 April 2020 2003 18 years’ service at 23 years’ service at 9 years’ service at 16 years’ service at 8 years’ service at Nedbank Nedbank Nedbank Nedbank Nedbank Terence Sibiya 50 Anél Bosman 53 Iolanda Ruggiero 49 Brian Kennedy 60 Ciko Thomas 51 Group Managing Group Managing Group Managing Group Managing Group Managing Executive: Wealth Executive: NAR Executive: CIB Executive: RBB Executive: CIB Exco member since Exco member since 1 Exco member since 5 August 2009. January 2015 25 June 2018 23 years’ service at 23 years’ service 1 years’ service at Nedbank at Nedbank Nedbank Deb Fuller 47 Trevor Adams 57 Mike Davis 48 Group Executive: Group Managing Executive: Chief Risk Officer Group HR Balance Sheet Management Exco member since Exco member since Exco member since Exco member since 1 January 2019 1 January 2015 15 May 2018 1 November 2008 22 years’ service at 18 years’ service at 2 years’ service at 23 years’ service at Nedbank Nedbank Nedbank Nedbank = reports to CE Priya Naidoo 46 Khensani Nobanda 41 Fred Swanepoel 56 Anna Isaac 50 = reports to COO Group Chief Group Executive: Group Executive: Group Chief Information Compliance Officer Strategy Marketing & Corporate Affairs Officer = reports to CFO 13 NEDBANK GROUP LIMITED – May 2020
Governance – Auditors & Mandatory Audit Firm Rotation Auditor tenure (years) Mandatory Audit Firm Rotation (MAFR) 46 ▪ Ernst & Young appointed as Nedbank & Nedbank Group’s new joint external auditor alongside Deloitte, effective May 2019. 1 ▪ IRBA’s MAFR rules effective from 1 April 2023 Deloitte E&Y If a firm has served as an appointed auditor for 10 or more consecutive financial years before the financial year Appointment of auditors commencing on or after 1 April 2023, then the audit firm may (2019 AGM % of votes) not accept reappointment as auditors. 99.9% 84.4% ▪ Some shareholders early-adopt MAFR principles in their proxy voting, but we reiterate: 15.6% 0.1% − Our commitment to fully implement MAFR for our 2024 Deloitte E&Y financial year & Deloitte’s rotation to be finalised by no For Against Against later than December 2023. Auditors fees (Rm) − We are limited in the short term by regulatory 196 195 171 requirements & the complexity & practicality of changing both auditors in a short period. − The board supports a staggered / risk mitigated approach to MAFR . 2020 will see Deloitte remain auditors 2017 2018 2019 (until new process commence). 14 NEDBANK GROUP LIMITED – May 2020
REMUNERATION 15 NEDBANK GROUP LIMITED – May 2020
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