Investec Plc · LSE:INVP
Investec — Non-Deal Roadshow (May 2012)
32 slides from Investec's roadshow presentation, May 2012
Slide 1: Investec Specialist Bank and Asset Manager
Out of the Ordinary® o Investec Specialist Bank and Asset Manager S Investec May 2012
Slide 2: Review of the environment
—_~ Out of the Ordinary® aa ae " Specialist Bank and Asset Manager ~ Review of the environment
Slide 3: Economic landscape
Economic landscape Slower global growth in 2012 IMF growth forecasts 3.5% for 2012 and 4.1% for 2013 World Bank global growth forecasts 2 2.5% 5% for 2012 and 3 3.1% 1% for 2013 Euro zone uncertainty Greece has restructured its debt, with Italy and Spain adopting tough fiscal measures Fu
Slide 4: Key banking themes for 2012
Key banking themes for 2012 Regulatory restrictions and global banking rules Further downgrades g for banks g globally y - New S&P ratings g for g global banks Continued de-leveraging pressures Higher capital requirements Pressure on top-line growth Remuneration structures and levels of
Slide 5: The banking industry is at a crossroads…
The banking industry is at a crossroads… “European banking really is at a crossroads – the likes of which we have not seen in modern times ,” Michael Lafferty, Co- times,” Co-Chairman of OMFIF and Lafferty Group, 21 October 2011. 5
Slide 6: Banks are considering their strategic alternatives
Banks are considering their strategic alternatives 6
Slide 7: The not-for-profit sector
The not-for-profit sector “ ” Source: The Economist 7 7
Slide 8: Long term share performance
Long term share performance 9-year price performance (Closing prices rebased) General Banking Investment Banking Specialty Banking 550 550 550 500 500 500 450 450 450 400 400 400 350 350 350 300 300 300 250 250 250 200 200 200 150 150 150 100 100 100 50 50 50 0 0 0 May 03 May 06 May 09 May 12 May 03
Slide 9: Review of Investec's financial year
Review of Investec’s financial year 9
Slide 10: Past year we experienced a difficult operating environment
Past year we experienced a difficult operating environment … Equity markets Interest rates 110 JSE UP 4.2% 6 Interest rates flat 5 100 ‐2.1% 4 Rebased to 100 90 ‐10.3% 3 % 2 80 1 70 0 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 JSE FTSE ASX SAJIB
Slide 11: Performance reflects the difficult environment
Performance reflects the difficult environment Financial performance for the year 2012 has echoed the difficulties of the broader environment We have realigned our business model, including South Africa With substantial integration taking place across the group We have maintained revenues de
Slide 12: We have realigned our business model ...
We have realigned our business model ... …by building capital light revenues Sustainable business model – Investec Limited Capital light R'mn Capital intensive R4 288mn R5 296mn 7,000 45% of SA 6,000 55% of SA (49% of group) 5,000 (51% of group) 4,000 Net fees and commissions Net interest income of
Slide 13: … into three distinct business areas
… into three distinct business areas Asset management and wealth management now account for 32% of SA % contribution of operating profit* of Investec Limited Investec Limited (Investec group) 100% 90% 80% 68% 69% (52%) 70% 76% (61%) 60% Specialist Banking (75%) 50% 40% 30% 32% Wealth & Investment 31
Slide 14: Impairments have improved
Impairments have improved Investec Limited South Africa R'bn 5% 150 4% 125 100 6 0% 6.0% 1 0% 1.0% 3% 75 2% 0.9% 50 1% 25 5.0% 0.8% 0% - 2008 2009 2010 2011 2012 0.7% 4.0% UK & Europe (ex Kensington) 0.6% £'bn 3.0% 0.5% 5% 8 4% 6 0.4% 3% 2.0% 4 0.3% 2% 1% 2 0.2% 1.0% 0% - 0.1% 2008 2009 2010 2011 20
Slide 15: Weak group performance
Weak group performance % Mar-12 Mar-11 Change Investec DLC Operating profit* before tax (£’000) 358 625 434 406 (17.4%) Operating profit* before tax and impairment losses on 683 743 752 636 (9.2%) loans and advances (£’000) (£ 000) Attributable earnings* (£’000) 257 579 327 897 (21.4%) Adjusted j EP
Slide 16: Flat performance in South Africa
Flat performance in South Africa % Mar-12 Mar-11 Change Investec Limited (excluding results of Investec plc) Operating profit* before tax and headline adjustments 3 328 3 305 0.7% (R’mn) Operating income before impairment losses on loans 9 584 9 416 1.8% and advances (R’mn) (R mn) Earnings attributa
Slide 17: Capital remains strong
Capital remains strong Investec Limited: Capital adequacy ratios Capital comparison to peers 18% 11.6% 16% Mar-12 16.1% 14% 12% 11.9% 10% Mar-11 15.9% 8% 6% 12.1% 4% Mar-10 15.5% 2% 0% 0% 5% 10% 15% 20% Investec ABSA FirstRand Nedbank Standard Bank Limited Tier 1 ratio Capital p adequacy q y ratio C
Slide 18: Strategy and positioning
/—™\ G4 \ Out of the Ordinary® & Investec Specialist Bank and Asset Manager Strategy and positioning 18
Slide 19: Our long term strategy
Our long term strategy Since inception we have expanded through a combination of organic growth and strategic acquisitions The internationalisation of Investec is based on the following strategy:: Following our customer base Gaining domestic competence and critical mass in the chosen geograp
Slide 20: Specialist bank and asset manager
Specialist bank and asset manager Three distinct business activities focused on well defined target clients Corporate / Institutional / Government Private Client (High Net Worth / High Income) Asset Specialist Banking* Wealth & Management Investment Provides investment Provides a broad range of serv
Slide 21: Asset Management
Asset Management Strategy Value proposition Long term sustainability Organically built an independent global platform from an The emphasis is on quality and depth across the emerging market base business Competitive investment performance in chosen Maintain cost discipline specialties In
Slide 22: Wealth & Investment
Wealth & Investment Creating gag global p platform with strong g regional g capability p y Strategy Value proposition Focus on internationalising the business Business has been built via consolidation of smaller businesses over a long period of time Deliver the successful integration g of Will
Slide 23: Specialist Banking
Specialist Banking 1st 1st Corporate Broking, Sales and Leading M&A advisor Leading Pan-European Brokerage Trading Execution 2011 Service Quality Firm – UK Small- & Mid-Cap Leading Corporate Performance Award UK Survey 2011 UK Survey 2011 Finance advisor Loans and deposits Global network £'bn 30 120
Slide 24: Conclusion
—~™ cA S & Investec Specialist Bank and Asset Manager Conclusion 24
Slide 25: Our brand is well developed …
Our brand is well developed … 25
Slide 26: … and we have invested in people and a sustainable future
… and we have invested in people and a sustainable future €50mn to Renewable Energy Funding Facility Entrepreneurship ProMaths awards Skills@work Investing for a sustainable future g programme, JASA South Africa Award in SA “Promaths made me! I learnt beyond the spheres of mathematics and science. T
Slide 27: Since UK listing: building recurring income
Since UK listing: building recurring income Average recurring income since 2003 of 63% £’mn 2500 80% 70% 2000 33.3% to £109 60% 31 6% to £174 31.6% 50% 1500 40% 12.3% to £884 1000 30% 20% 500 2.6% to £699 10% 0 0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Net interest income Annuity fees and
Slide 28: Since UK listing: strong growth in core earnings drivers
Since UK listing: strong growth in core earnings drivers Third party assets under management Core loans and advances and deposits CAGR since 2003 of 17% CAGR since 2003 - customer deposits 17% CAGR since 2003 - loans 19% £'bn £'bn 120 30 120% 100 25 100% 80 20 80% 60 15 60% 40 10 40% 20 5 20% - - 0%
Slide 29: Since UK listing: solid growth (excl. dividends)
Since UK listing: solid growth (excl. dividends) CAGR of NTAV: 23% CAGR of NATV per share: 17% pence £'mn 700 3,000 600 2,500 500 2,000 400 1,500 300 1 000 1,000 200 500 100 0 - 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Net tangible asset value (excluding goodwill) (£'mn) (RHS) Net tangible
Slide 30: Since UK listing: returns (incl. dividends)
Since UK listing: returns (incl. dividends) Investing g at 31 March 2003 IRR at the respective year end date on share price and dividends 86.3% 75.5% 67.1% 59.2% 31.9% 31.4% 26.8% 25.3% 22.5% Mar 2004 Mar 2005 Mar 2006 Mar 2007 Mar 2008 Mar 2009 Mar 2010 Mar 2011 Mar 2012 IRR at the respective year
Slide 31: Since UK listing: Strong capital growth
Since UK listing: Strong capital growth CAGR since 2003: 21% £'mn £ mn 6,000 5,000 4,000 3,000 2,000 1,000 - 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Total shareholders’ equity (including preference shares and non-controlling interests) Total capital resources (including subordinated liabil
Slide 32: Thank you
—~ Out of the Ordinary® i~ WIN ae ~ Specialist Bank and Asset Manager THANK YOU