1 DEVELOPMENT BANK OF SOUTHERN AFRICA DEVELOPMENT BANK OF SOUTHERN AFRICA 2004 Annual Report Launch MSV GANTSHO CEO AND Managing Director “21 years old, 10 years of freedom and democracy.. The tide has turned”

1 Development Impact  Approved development projects with a total monetary value of R87 billion, with a financial contribution by the DBSA of R32 billion  GDP = R17.7  Employment = jobs  Households impacted :4.03 mil

1 Financial Sustainability  Credit ratings  Fitch: AAA – domestic rating  Moody’s: Baa2 – international rating  Standard and Poor’s: BBB – international rating  Capital adequacy  Debt/Equity ratio 105.9%  Basle Accord minimum requirement is 8% the SA Reserve bank is 10%  DBSA is 50%

1 Human Capital And Knowledge Management  Most valuable asset  A key differentiator from commercial banks  Add value to financial strength  Ensures a people-focused development

1 Strong And Smart Partnerships  Vision 2004 : “ To be a leading change agent for socio- economic development in SADC”  DBSA is a partner of choice  Financial co-operation  Knowledge sharing  Training  Staff exchange  Managing 22 Agency programmes for Gov, DFIs, NGOs, Labour, Civil society

1 Strong And Smart Partnerships  70% of municipalities are clients  DBSA has financed projects in 10 countries other than South Africa - reaching out as far as Tanzania, Angola and Zambia  Funding relationships exist with 5 entities (NIB, AfDB, AfD, EIB, and KfW)

1 Municipal ICT  Multipurpose PPP project  Placement and training IT graduates in rural municipalities  40 Students already trained and placed country wide

1 Thabachweu Municipality Bourke’s Luck  Conversion of the Bourke’s Luck military base to a MPCC  Tourism and conservation spin-offs  Mobilised other players: R4 million  Development Fund contribution R

1 Makana Municipality  Development Fund funding for development of strategic human Resource and performance management system  As a result the municipality was rated in the Top Ten Municipality by the VUNA municipal excellence awards  Development Fund contribution R

1 CAPACITY BUILDING  Use of knowledge to build sustainable capacity  To seek innovative solutions  Vulindlela training academy  A nerve centre for e-learning  To collaborate with training institutions and institutions of higher education and learning  LGNet virtual private network connecting municipalities to the LGRC web based portal  Development fund recapitalised by R300mil  R41 mill disbursed

1 CAPACITY BUILDING PROGRAMMES  Municipal ICT Graduate Internship Programme  Thabanchu Municipality (Bourke’s Luck Feasibility Study) Mpumalanga  Makana Municipality (Integrated Performance management system) Eastern Cape

1 REDUCTION OF INFRASTRUCTURE BACK LOCKS  Households with access to basic levels of services have increased Electricity57.7% 70.4% Water79.8% 85.0% Sanitation82.5% 82.7% Refuse56.6% 59.0% Telephones75.2% 90.6%  DBSA is ready to re-double it’s contribution to the elimination of remaining backlogs  Vision 2014 is: A region free of poverty, inequity and dependency

1 DEVELOPMENT BANK OF SOUTHERN AFRICA Annual Report Launch 5 August 2004 ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2004

1 HIGHLIGHTS OF 2004  Full implementation of AC133  Comparatives not restated – impact on opening accumulated surplus (R 402 million)  Revaluation of land and buildings  Value of land unchanged on R 18,8 million  Resulting increase in revaluation reserve on building of R9,7 million  Change in basis of actuarial valuation of the Post Retirement Medical Benefit provision  Increase in the liability of R 39 million

1 FINANCIAL PERFORMANCE 2003/042002/03Movement Gross interest incomeR 2,53bnR 2,28bn  11,0% Operating income R 1,45bnR 1,65bn  12,1% (excl. unrealised profits/losses)(R 1,53bn) (R 1,35bn) (  13,3%) Movement in impairments – net write-backR69,9mR38,7m  80,6% Operating expensesR 382,3m R 286,9m  33,3% (as % of operating income) (26,4%)(17,4%) Surplus from operations R 1,063bn R 1,364bn  22% (excl. unrealised profits/losses) (R 1,147bn) (R 1,059bn) (  8,3%) Grant to Development FundR 300mR 80m  275% Surplus for the yearR 763mR 1,28bn  40,4%

1 The financial results and financial position indicate continued financial sustainability in the foreseeable future… THANK YOU