Slide 1: Green bond investor roadshow
Green bond investor roadshow October 2023
Slide 2: Agenda
2 Agenda • Group’s climate approach • Client solutions/value propositions • FRB’s debut green bond issuance • Term sheet
Slide 3: Group's climate approach
Group’s climate approach FirstRand
Slide 4: FirstRand considers climate change as both a risk and opportunity
4 FirstRand considers climate change as both a risk and opportunity • FirstRand believes climate change is a challenge globally • As a systemic bank and allocator of financial resources, the group must deliver solutions for climate resilience and a just transition • All sectors and segments will be
Slide 5: Responding to climate risk and opportunities is integrated into FirstRand's strategy
5 Responding to climate risk and opportunities is integrated into FirstRand’s strategy • Foundational climate risk management established in 2020 and well entrenched • Operationalised group’s climate response FRM framework – key enabler Dedicated governance structures • Incentivise green deals throu
Slide 6: Ensuring accountability
6 Ensuring accountability • Remuneration practices • Climate included in exec scorecards – weighting aligned with other material growth strategies, e.g. diversification, digitisation • Lack of progress on climate roadmap can result in downward adjustment of LTI vesting outcome • Published five-year
Slide 7: FirstRand's climate ambitions and commitments
7 FirstRand’s climate ambitions and commitments No new thermal coal lending * Transaction underwriting, arranging, lending and advisory. Commitment or ambition met in 2023 financial year.
Slide 8: Current focus is balance sheet driven
8 Current focus is balance sheet driven Built climate balance sheet The group is using this balance sheet view to understand its baseline. Help clients to assess climate impact and responses (including transition pathways). Client engagement Gives group better understanding of balance sheet opportun
Slide 9: FirstRand climate balance sheet
9 FirstRand climate balance sheet The climate balance sheet is being used to steer portfolio decarbonisation 2030 Green assets and clients aligned Green Measured growth with international definitions Olive Accelerated transition Strong growth Outsized emissions (transition risk) or Measured Brown in
Slide 10: Client solutions/value propositions
10 Client solutions/value propositions
Slide 11: RMB green finance solutions
11 RMB green finance solutions 01 02 03 Financial solutions Advisory/stakeholder engagement Platform and eco-system enabled • Green loans • Working with corporates to • Developing hedging instruments • Green bond facilitation understand their climate risks, with a thematic focus on • Performance-lin
Slide 12: FNB green finance solutions
12 FNB green finance solutions Retail Commercial Residential mortgage solutions to Innovative sustainable finance funding solutions facilitate energy-efficient homes Financial solutions Asset-based sustainable finance solutions Development and implementation of a Partnering with clients to understan
Slide 13: FRB's inaugural green bond issuance
13 Click to edit Master title style FRB’s inaugural green bond issuance
Slide 14: FirstRand's sustainability bond framework
14 FirstRand’s sustainability bond framework • In December 2021, the group published its sustainability bond framework under which its subsidiaries can issue thematic debt instruments, such as green, social and/or sustainability bonds • Aligned to international best practice and guidance as issued b
Slide 15: FRB's inaugural green bond
15 FRB’s inaugural green bond Existing loans are those which have reached financial close, up to 24 months 50% of total bond issuance will be prior to the issuance or where the assets allocated to existing green assets are not yet fully operational New loans are those where disbursements 50% of tota
Slide 16: Use of proceeds – green assets
16 Use of proceeds – green assets One of the thematic investment categories of the green bond is renewable energy which is critical in enabling a transition to a low-carbon economy and addressing the current energy challenges in SA – the proceeds for existing and new assets are likely to be largely
Slide 17: Use of proceeds – green assets
17 Use of proceeds – green assets Indicative portfolio of green assets for FNB Retail Commercial Eco-energy home loans Asset-based finance – solar • IFC EDGE certified residential buildings • Financing for solar PV plants paid directly to vetted suppliers Indicative impact reporting • Number of mort
Slide 18: Monitoring and reporting
18 Monitoring and reporting • FirstRand will publish an annual allocation and impact Extract from first allocation report on report on its website FRB’s previously issued sustainability bonds • Supported by a limited assurance report on the allocation provided by external auditors on an annual basis
Slide 19: Term sheet
19 Click to edit Master title style Term sheet
Slide 20: Indicative term sheet
20 Indicative term sheet Issuer FirstRand Bank Limited National scale credit rating Moody’s Aa1.za & S&P Global zaAA Nominal target R3 billion, with the ability to increase to R3.5 billion, subject to volume and bid spreads Note tenor 5 year/7 year Interest payment basis Floating rate note Pricing r
Slide 21: Indicative timeline
21 Indicative timeline Event Date Term sheet and draft applicable pricing supplement 28 September 2023 Virtual investor roadshow 2 and 3 October 2023 Updated term sheet with price guidance 4 October 2023 Proposed auction date 9 October 2023 Settlement date (t+3) 12 October 2023
Slide 22: Relevant links
22 Relevant links Disclosure Link FirstRand sustainability bond framework www.firstrand.co.za/media/investors/governance/firstrand-sustainability-bond-framework.pdf Second-party opinion – www.firstrand.co.za/media/investors/governance/second-party-opinion-firstrand-sustainability-bond-framework.pdf