The ratings are based on the following key factors:

The accorded ratings reflect the bank’s established local franchise value, its sound capitalisation and stable income metrics, as well as its moderate credit risk appetite. These are, however, partially offset by the uncertainties around a progressive and/or continuing global economic recovery.

Moreover, considering the intangible support rating level, the bank’s South African national scale rating show a three notch variance over that of the government’s equivalent.

The stable outlook/s on the ratings reflect the view that the bank’s franchise position and performance are sustainable, and takes into account its overall strategic focus (and initiatives) on refining the quality of its funding envelope.

Following from the above, after the recent listing of the bank’s parent, a part allocation was channelled down by means of a primary capital issuance/uptake, boosting its float level (plus serve as underpin to full and timely basel compliance).

Buoyed by expansionary economic action, and by extension business’ fortunes, less geared personal balance sheets and underlying loan growth, the performance of the combined pool showed an improvement, despite the marginal movements in the standard performance tracking ratios. This notion is further emphasised when looking at the rate and number of client defaults, as well as its translation into an actual loss rate movement - also, expected losses are well provided for.

For the period under review, the bank delivered positive results, its third consecutive annum of upward trending revenue and/or capital generation. That said, across the board improvement was noted, helped along by growth in business and client volumes, and margin retention - thus offsetting the higher fringe cost of financing and loan losses, and moderate increases in operating expenditure.

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