Absa Group Limited

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(1)Absa Group Limited. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. Financial results for the reporting period ended 31 December 2019.

(2) Report overview 7KLVĔQDQFLDOUHVXOWVERRNOHWIRUWKHUHSRUWLQJSHULRGHQGHG'HFHPEHULVRQHRIWKHSXEOLFDWLRQV UHOHDVHGDWWKHWLPHRI$EVD*URXS/LPLWHGàV $EVD*URXSRUWKH*URXS ĔQDQFLDOUHVXOWVDQQRXQFHPHQW RQ0DUFK,WLVVXSSOHPHQWHGZLWKDGGLWLRQDOGLVFORVXUHVLQFOXGLQJWKH*URXSàV-6(/LPLWHG6(16 DQQRXQFHPHQWDQGWKHDQQXDOĔQDQFLDOUHVXOWVSUHVHQWDWLRQ7KHIXOOVHWRIGRFXPHQWVLVDYDLODEOHRQ www.absa.africa. i i. Rest of Africa (RoA) Banking was renamed to Absa Regional Operations (ARO) to align with the Absa Group brand. Wealth, Investment Management and Insurance (WIMI) has been removed from the Group’s segmental disclosures to align with how the operations are now managed: { Life Insurance and Short-term Insurance (including Insurance Absa Regional Operations) are disclosed as the Insurance Cluster in Retail and Business Banking South Africa (RBB SA). { Wealth, Distribution and Fiduciary services have moved to the Relationship Banking segment in RBB SA. { WIMI Other is part of Retail and Business Banking Other in RBB SA. { Investment Management is reported in Head Office, Treasury and other operations in South Africa. { Terminating lines is reported in Head Office, Treasury and other operations in South Africa.. The aforementioned segment changes have resulted in the UHVWDWHPHQWRIĔQDQFLDOUHVXOWVIRUWKHUHVSHFWLYHVHJPHQWV but have not impacted the overall position or net earnings of the Group.. 2. Business portfolio changes . T he following business portfolio changes have taken place during the reporting period:. . i. RBB SA operating model: RBB SA has aligned its operating model to enable a more customer-centric approach, which offers more holistic product offerings. The business has now been arranged into the following units: { { { { { {. Home Loans; Vehicle and Asset Finance; Everyday Banking; Relationship Banking; Insurance Cluster; Retail and Business Banking Other.. . i. Software projects and other assets, liabilities (together with the funding provided by Treasury) and associated income and expenses, which were previously centrally maintained, have EHHQPRYHGIURP+HDG2IĔFHLQ6RXWK$IULFDWRWKHYDULRXV responsible segments to ensure end-to-end accountability of business activities.. . i. 7KH$EVD1DPLELDUHSUHVHQWDWLYHRIĔFHZKLFKZDV previously reported in ARO, has been moved to Corporate and Investment Banking South Africa (CIB SA) to support its regional expansion strategy.. The business portfolio changes have resulted in the restatement of ĔQDQFLDOUHVXOWVIRUWKHUHVSHFWLYHVHJPHQWVEXWKDYHQRWLPSDFWHG the overall position or net earnings of the Group.. . i. In October 2019, Absa Bank Limited entered into an agreement to sell the Edcon loan book within RBB SA. )RUWKHĔQDQFLDO\HDUHQGHG'HFHPEHUWKHERRNZDV UHFODVVLĔHGIURPORDQVDQGDGYDQFHVWRFXVWRPHUVWRQRQ current assets held for sale as required by IFRS 5. The loan book continued to be measured in accordance with IFRS 9. 7KHFRQGLWLRQVSUHFHGHQWWRWKLVVDOHZHUHIXOĔOOHGLQ-DQXDU\ 2020, with the effective date of the transfer being 1 February 2020.. 3. Adoption of new International Financial Reporting Standards (IFRS) New IFRSs have been adopted, of which IFRS 16 Leases ,)56 KDVWKHPRVWVLJQLĔFDQWLPSDFWRQWKH*URXSàVUHVXOWV Refer to note 17 for more information.. Dividend per share Final: 620 cents Interim: 505 cents Key dates Dividend payment: 20 April 2020 )LQDQFLDO\HDUHQG'HFHPEHU $QQXDOJHQHUDOPHHWLQJ-XQH Shareholder communications Shareholder information Contact details. page 162 page 172. • The Board of Directors oversees the Group’s activities and holds management accountable for adhering to the risk governance framework. To do so, directors view reports prepared by the businesses, risk and others. They exercise sound independent judgement, and probe and challenge recommendations, as well as decisions made by management. • Finance is responsible for establishing a strong control HQYLURQPHQWRYHUWKH*URXSàVĔQDQFLDOUHSRUWLQJSURFHVVHV and serves as an independent control function advising EXVLQHVVPDQDJHPHQWHVFDODWLQJLGHQWLĔHGULVNVDQG establishing policies or processes to manage risk. • Finance is led by the Financial Director who reports directly to the Group Chief Executive. The Financial Director has regular and unrestricted access to the Board of Directors as well as to the Group Audit and Compliance Committee (GACC). • Together with the GACC, the Board has reviewed and approved WKHUHSRUWLQJFKDQJHVFRQWDLQHGLQWKHĔQDQFLDOUHVXOWV announcement released on 11 March 2020.. The full set of documents is available on www.absa.africa. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. 1. Reportable segment changes.

(3) Contents ifc Report overview. 123. 2 The Absa Group today. Group IFRS performance. 124 Consolidated IFRS salient features 3. 125 Consolidated IFRS statement of comprehensive income. Normalised Group performance. 127 &RQVROLGDWHG,)56VWDWHPHQWRIĔQDQFLDOSRVLWLRQ. 4 Normalised Group performance overview. 128 Consolidated IFRS statement of changes in equity. 8 Normalised salient features. &RQGHQVHGFRQVROLGDWHG,)56VWDWHPHQWRIFDVKĕRZV. 9 Normalised salient features by segment. &RQGHQVHG,)56QRWHVWRWKHFRQVROLGDWHGĔQDQFLDO statements. 10 3URĔWFRPPHQWDU\. Reconciliation of IFRS to normalised results. 14 Basis of presentation. 140 Barclays separation effects. 15 Dividend announcement 16 Consolidated normalised statement of comprehensive income 18 &RQVROLGDWHGQRUPDOLVHGVWDWHPHQWRIĔQDQFLDOSRVLWLRQ. 142. Risk management. 20 Consolidated normalised statement of changes in equity 24 &RQGHQVHGFRQVROLGDWHGQRUPDOLVHGVWDWHPHQWRIFDVKĕRZV 25 3HUIRUPDQFHLQGLFDWRUVDQGFRQGHQVHGQRUPDOLVHGQRWHVWR WKHFRQVROLGDWHGĔQDQFLDOVWDWHPHQWV. Risk management overview 155 Capital management and RWA. 160 59. Appendices. Segment performance 161 Share performance. 60 WIMI (as previously disclosed) segment change. 162 Shareholder information and diary. 61 Segment performance overview. Glossary. 64 Segment report per market segment. 170 Abbreviations and acronyms. 66 Segment report per geographical segment. 172 Contact information. 68 RBB South Africa 90 CIB 106 Absa Regional Operations. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. 122 +HDG2IĔFH7UHDVXU\DQGRWKHURSHUDWLRQVLQ6RXWK$IULFD. Icons used with this report 3RVLWLYH Negative Remains the same Increase/decrease Marginal. $EVD*URXS/LPLWHG The term Absa Group or the Group refers to Absa Group Limited and its subsidiaries. )LQDQFLDOUHVXOWVIRUWKHUHSRUWLQJSHULRGHQGHG'HFHPEHU Date of publication: 11 March 2020. 7KHVHDQQXDOĔQDQFLDOUHVXOWVZHUHSUHSDUHGE\$EVD*URXS)LQDQFLDO&RQWUROXQGHUWKHGLUHFWLRQDQGVXSHUYLVLRQRIWKH $EVD*URXS/LPLWHG)LQDQFLDO'LUHFWRU-34XLQQ&$ 6$ 7KLVUHSRUWLVSULQWHGRQUHF\FOHGSDSHUWKDWLVSRVWFRQVXPHUZDVWHVRXUFHGIURPHLWKHURIĔFHRUSULQWLQJZDVWHZLWK no harmful chemicals used during the bleaching process. The byproducts of production of the paper are recycled into fertiliser, building materials and heat.. Absa Group Limited Financial results for the reporting period ended 31 December 2019. 1.

(4) The Absa Group today As a financial services provider, we play an important role in the economic life of individuals, businesses and nations. We help to create, grow and protect wealth through partnerships in economic development, while playing a shaping role in Africa’s growth and sustainability.. ossibility t your p o lif g n i e Br 3 priorities. Crea te entr a th ep r orga rene ivin nis ur g at i ion. re leadership Resto in core businesses al. We believe in possibility, in the actions of people who always find a way to get things done. We believe in creating opportunities for our customers to make their possibilities real and supporting them every step of the way.. w. y. Gr. owth. sc. th. P ur s u e r ow t h g oppor tunities. 3 en. Bu l gi able ild a ta l Ĕ in n o va t r st bus ive, ines s. ring nee pio itions ild pos Bu pro ew. ng pi ha gro as t a’s ili Play f r i c in a b nA ta role i sus and. Bring your possibility to life. n. a. di. a b li n g c a p a b ili t i e s. Our strategy will bring our purpose alive as we pursue our goal of growth.. 1.. Growing our portfolio while contributing to the growth of the markets we serve.. 2.. Reducing costs by creating a more efficient and effective organisation.. 3.. 2. Delivering top, sustainable returns that maximise long-term value.. Our measures of progress. 1.. To grow revenue faster, on average, than the South African banking sector, with an improving trend over time and within appropriate risk appetite parameters.. 2.. To consistently reduce our normalised cost-to-income ratio to reach the low 50s by 2022.. 3.. To achieve a normalised Group return on equity of 18% to 20% by 2022, which is heavily dependent on the state of SA's economy, while maintaining an unchanged dividend policy.. Absa Group Limited Financial results for the reporting period ended 31 December 2019. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. Our strategic objectives.

(5) Normalised Group performance Normalised Group performance overview. 4. Normalised salient features. 8. Normalised salient features by segment. 9 10. Basis of presentation. 14. Dividend announcement. 15. Consolidated normalised statement of comprehensive income. 16. &RQVROLGDWHGQRUPDOLVHGVWDWHPHQWRIĔQDQFLDOSRVLWLRQ. 18. Consolidated normalised statement of changes in equity. 20. &RQGHQVHGFRQVROLGDWHGQRUPDOLVHGVWDWHPHQWRIFDVKĕRZV. 24. Performance indicators and condensed normalised notes to the FRQVROLGDWHGĔQDQFLDOVWDWHPHQWV. 25. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. 3URĔWFRPPHQWDU\. Absa Group Limited Financial results for the reporting period ended 31 December 2019. 3.

(6) 3 Normalised Group performance 59 Segment performance 123 Group IFRS performance 142 Risk management 160 Appendices. 4 8 9 10 14 15 16. Overview Normalised salient features Normalised salient features by segment 3URĔWFRPPHQWDU\ Basis of presentation Dividend announcement )LQDQFLDOVDQGQRWHVWRWKHĔQDQFLDOV. 60 61 64 66. WIMI segment change Overview Per market segment Per geographical segment. 68 90 106 122. RBB South Africa CIB Absa Regional Operations +HDG2IĔFH7UHDVXU\DQGRWKHURSHUDWLRQV. Normalised Group performance overview IRUWKHUHSRUWLQJSHULRGHQGHG'HFHPEHU. Improving revenue momentum of 6%. Headline earnings increased by 1%. (CCY +5%), particularly in RBB SA which increased by 5% and ARO remaining strong at 14% (CCY +11%).. &&<ĕDW WR5EQDVKLJKHU SUHSURYLVLRQSURĔWVZHUHRIIVHWE\ 24% higher impairments. SA business units headline earnings were down ZKLOHHDUQLQJVRXWVLGHRI6$VKRZHG VWURQJJURZWKRI &&< DQG SURYLGHGSRUWIROLRGLYHUVLĔFDWLRQ. Balance sheet momentum remains strong. Return on equity of 15.8%. Cost growth contained. Net interest margin decreased. WRLQĕDWLRQDU\OHYHOVRI &&< GHVSLWHWKHLPSDFWRILQFUHDVHG incremental run, restructuring charges DQGRWKHURQFHRIIV/RZXQGHUO\LQJFRVW JURZWKKDVEHHQVXSSRUWHGE\EHQHĔWV RIWDUJHWHGFRVWUHGXFWLRQV. IURPESVWRESVPDLQO\UHĕHFWLQJ WKHLPSDFWRIIXQGLQJPL[DVORZPDUJLQ IXQGLQJFRQWLQXHVWRJURZIDVWHUWKDQ higher margin transactional balances.. 3UHSURYLVLRQSURĔWXS. Credit loss ratio increased. (CCY +4%) showing improved momentum LQ5%%6$XSYHUVXVSULRU\HDUGRZQ DQG$52RI &&< YHUVXV prior year growth up 1% (CCY +4%).. WRESV 3<ESV DQGLPSDLUPHQW FKDUJHVLQFUHDVHGE\ &&< 5%%6$LQFUHDVHGE\SDUWLFXODUO\LQ XQVHFXUHGSURGXFWVZKLFKLVUHĕHFWLYHRI WKHLPSDFWRIQHZEXVLQHVVVWUDLQDQGDQ increase in coverage. ARO increased by &&< RIIDORZEDVHSDUWLDOO\ RIIVHWE\&,%6$GRZQIURPKLJKHU single name charges in the prior year.. Marginally negative JAWS (-0.5%) UHĕHFWLQJUHYHQXHJURZWKRI &&< RIIVHWE\RSHUDWLQJFRVW JURZWKRI &&< ZLWKFRVW WRLQFRPHUDWLR LQFUHDVLQJ marginally on the prior year.. 4. Absa Group Limited Financial results for the reporting period ended 31 December 2019. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. across business units with customer GHSRVLWVJURZLQJE\ &&< DQGSOHDVLQJO\JURZLQJIDVWHUWKDQJURVV customer advances up 9% (CCY +9%).. GHFUHDVHGIURPWKHSULRU\HDU UHĕHFWLQJORZHDUQLQJVJURZWKFRXSOHG ZLWKDLQFUHDVHLQDYHUDJHHTXLW\.

(7) 124 125 133 138 140. 143 Risk management overview 155 Capital management. IFRS salient features Financials 1RWHVWRWKHĔQDQFLDOV Reconciliation Barclays separation. 161 162 163 170 172. Share performance Shareholder information and diary Glossary Abbreviations and acronyms Contact information. Normalised Group performance overview IRUWKHUHSRUWLQJSHULRGHQGHG'HFHPEHU. 1 687.2. 1 769.6. 1 845.6. 1 913.4. Dividend per share (DPS) (cents). 1 926.0 1 000 550. 1 030 570. 1 070 595. 1 110 620. 1% 2015. 2016. 2017. 2018. 2019. Net asset value (NAV) per ordinary share (cents). 10 588. 10 980. 11 573. 11 985. 12 605. 1 125. 1% 2015. 2016. 2017. 2018. 2019. Return on equity (RoE) (%). 17.0. 16.6. 16.5. 16.8. 2016. 2017. 2018. 15.8. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. Headline earnings per ordinary share (HEPS) (cents). 5% 2015. 2016. 2017. 2018. 2019. 2015. 2019. Absa Group Limited Financial results for the reporting period ended 31 December 2019. 5.

(8) 3 Normalised Group performance 59 Segment performance 123 Group IFRS performance 142 Risk management 160 Appendices. 4 8 9 10 14 15 16. Overview Normalised salient features Normalised salient features by segment 3URĔWFRPPHQWDU\ Basis of presentation Dividend announcement )LQDQFLDOVDQGQRWHVWRWKHĔQDQFLDOV. 60 61 64 66. WIMI segment change Overview Per market segment Per geographical segment. 68 90 106 122. RBB South Africa CIB Absa Regional Operations +HDG2IĔFH7UHDVXU\DQGRWKHURSHUDWLRQV. Normalised Group performance overview IRUWKHUHSRUWLQJSHULRGHQGHG'HFHPEHU. IFRS Group performance. 2019 Barclays separation effects. Normalised Group performance. Net interest income Non-interest income. 46 501 33 619. (195) 36. 46 306 33 655. 7RWDOLQFRPH ,PSDLUPHQWORVVHV 2SHUDWLQJH[SHQVHV 2WKHUH[SHQVHV 6KDUHRISRVWWD[UHVXOWVRIDVVRFLDWHVDQGMRLQWYHQWXUHV. 80 120 (7 816) (48 767) (2 006) 221. (159) — 2 410 113 —. 79 961 (7 816) (46 357) (1 893) 221. 2SHUDWLQJSURĔWEHIRUHLQFRPHWD[ 7D[H[SHQVHV. 21 752 (5 772). 2 364 (538). 24 116 (6 310). 3URĔWIRUWKHUHSRUWLQJSHULRG. 15 980. 1 826. 17 806. 14 256 937 352 435. 1 747 79 — —. 16 003 1 016 352 435. 15 980. 1 826. 17 806. 14 526. 1 739. 16 265. 4.50 0.80 42.0 5 4 60.9 26.5. n/a n/a n/a n/a n/a n/a n/a. 4.50 0.80 42.1 6 6 58.0 26.2. 916 978 59 745 116 747 305 705. — — — (4 681). 916 978 59 745 116 747 301 024. 1 399 175. (4 681). 1 394 494. 826 293 159 794 284 405. — — 2 1621. 826 293 159 794 286 567. 7RWDOOLDELOLWLHV (TXLW\. 1 270 492 128 683. 2 162 (6 843). 1 272 654 121 840. 7RWDOHTXLW\DQGOLDELOLWLHV. 1 399 175. (4 681). 1 394 494. 1.07 13.1 15.8 12.1. n/a n/a n/a n/a. 1.20 15.8 15.5 11.8. 1 747.6. n/a. 1 923.3. Reconciliation of IFRS to normalised results Statement of comprehensive income (Rm). 3URĔWDWWULEXWDEOHWR 2UGLQDU\HTXLW\KROGHUV Non-controlling interest – ordinary shares 1RQFRQWUROOLQJLQWHUHVWÝSUHIHUHQFHVKDUHV Non-controlling interest – Additional Tier 1 capital. Headline earnings. Operating performance (%) Net interest margin on average interest-bearing assets Credit loss ratio on gross loans and advances to customers and banks 1RQLQWHUHVWLQFRPHDVRIWRWDOLQFRPH ,QFRPHJURZWK 2SHUDWLQJH[SHQVHVJURZWK Cost-to-income ratio (IIHFWLYHWD[UDWH /RDQVDQGDGYDQFHVWRFXVWRPHUV /RDQVDQGDGYDQFHVWREDQNV ,QYHVWPHQWVHFXULWLHV Other assets 7RWDODVVHWV 'HSRVLWVGXHWRFXVWRPHUV 'HEWVHFXULWLHVLQLVVXH Other liabilities. Key performance ratios (%) Return on average assets (RoA) 5HWXUQRQHTXLW\ 5R( &DSLWDODGHTXDF\ &RPPRQ(TXLW\7LHU. Share statistics (cents) 'LOXWHGKHDGOLQHHDUQLQJVSHURUGLQDU\VKDUH. 1. 7KLVUHSUHVHQWVWKHFRQWULEXWLRQRI5EQWKDWZDVUHFHLYHGIURP%DUFOD\V3/&QHWRIDPRXQWVDOUHDG\VSHQWRQVHSDUDWLRQDFWLYLWLHV7KHFDVKUHFHLYHGLVKHOG FHQWUDOO\E\7UHDVXU\DQGLVSUHVHQWHGDVDQLQWHUVHJPHQWDODVVHWLQß2WKHUOLDELOLWLHVà7KHDPRXQWLVSUHVHQWHGLQß/RDQVIURP%DUFOD\VVHSDUDWLRQVHJPHQWàLQWKH &RQVROLGDWHGQRUPDOLVHGVWDWHPHQWRIĔQDQFLDOSRVLWLRQ UHIHUWRSDJH . 6. Absa Group Limited Financial results for the reporting period ended 31 December 2019. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. 6WDWHPHQWRIĔQDQFLDOSRVLWLRQ 5P.

(9) 124 125 133 138 140. IFRS salient features Financials 1RWHVWRWKHĔQDQFLDOV Reconciliation Barclays separation. 143 Risk management overview 155 Capital management. 161 162 163 170 172. Share performance Shareholder information and diary Glossary Abbreviations and acronyms Contact information. Normalised Group performance overview IRUWKHUHSRUWLQJSHULRGHQGHG'HFHPEHU. ,)56*URXS SHUIRUPDQFH. Barclays separation HIIHFWV. Normalised *URXS SHUIRUPDQFH. Net interest income Non-interest income. . (525). . 7RWDOLQFRPH ,PSDLUPHQWORVVHV 2SHUDWLQJH[SHQVHV 2WKHUH[SHQVHV 6KDUHRISRVWWD[UHVXOWVRIDVVRFLDWHVDQGMRLQWYHQWXUHV. . — 194 —. . 2SHUDWLQJSURĔWEHIRUHLQFRPHWD[ 7D[H[SHQVHV. 21 541 . . . 3URĔWIRUWKHUHSRUWLQJSHULRG. 15 259. . . . — —. . 15 259. . . 14 142. . . 4 29.2. n/a n/a n/a n/a n/a n/a n/a. 4 5 . . — — — . . . . . Reconciliation of IFRS to normalised results Statement of comprehensive income (Rm). 3URĔWDWWULEXWDEOHWR 2UGLQDU\HTXLW\KROGHUV Non-controlling interest – ordinary shares 1RQFRQWUROOLQJLQWHUHVWÝSUHIHUHQFHVKDUHV Non-controlling interest – Additional Tier 1. Headline earnings. Operating performance (%) Net interest margin on average interest-bearing assets Credit loss ratio on gross loans and advances to customers and banks 1RQLQWHUHVWLQFRPHDVRIWRWDOLQFRPH ,QFRPHJURZWK 2SHUDWLQJH[SHQVHVJURZWK Cost-to-income ratio (IIHFWLYHWD[UDWH. 6WDWHPHQWRIĔQDQFLDOSRVLWLRQ 5P. 7RWDODVVHWV 'HSRVLWVGXHWRFXVWRPHUV 'HEWVHFXULWLHVLQLVVXH Other liabilities. . — — 1. . 7RWDOOLDELOLWLHV (TXLW\. . . . 7RWDOHTXLW\DQGOLDELOLWLHV. . . . . n/a n/a n/a n/a. 15.4 . . n/a. . WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. /RDQVDQGDGYDQFHVWRFXVWRPHUV /RDQVDQGDGYDQFHVWREDQNV ,QYHVWPHQWVHFXULWLHV Other assets. Key performance ratios (%) Return on average assets (RoA) 5HWXUQRQHTXLW\ 5R( &DSLWDODGHTXDF\ &RPPRQ(TXLW\7LHU. Share statistics (cents) 'LOXWHGKHDGOLQHHDUQLQJVSHURUGLQDU\VKDUH. 1. 7KLVUHSUHVHQWVWKHFRQWULEXWLRQRI5EQWKDWZDVUHFHLYHGIURP%DUFOD\V3/&QHWRIDPRXQWVDOUHDG\VSHQWRQVHSDUDWLRQDFWLYLWLHV7KHFDVKUHFHLYHGLVKHOG FHQWUDOO\E\7UHDVXU\DQGLVSUHVHQWHGDVDQLQWHUVHJPHQWDODVVHWLQß2WKHUOLDELOLWLHVà7KHDPRXQWLVSUHVHQWHGLQß/RDQVIURP%DUFOD\VVHSDUDWLRQVHJPHQWàLQWKH &RQVROLGDWHGQRUPDOLVHGVWDWHPHQWRIĔQDQFLDOSRVLWLRQ UHIHUWRSDJH . Absa Group Limited Financial results for the reporting period ended 31 December 2019. 7.

(10) 3 Normalised Group performance 59 Segment performance 123 Group IFRS performance 142 Risk management 160 Appendices. 4 8 9 10 14 15 16. Overview Normalised salient features Normalised salient features by segment 3URĔWFRPPHQWDU\ Basis of presentation Dividend announcement )LQDQFLDOVDQGQRWHVWRWKHĔQDQFLDOV. 60 61 64 66. WIMI segment change Overview Per market segment Per geographical segment. 68 90 106 122. RBB South Africa CIB Absa Regional Operations +HDG2IĔFH7UHDVXU\DQGRWKHURSHUDWLRQV. Normalised salient features IRUWKHUHSRUWLQJSHULRGHQGHG'HFHPEHU. 2019. . Change %. 79 961 46 357 16 003 16 265. . 1 1. 916 978 1 394 494 826 293 93.0 87.5. . 9 12. 15.8 1.20 1.91 4.67. 2.12 . 4.50 0.80 42.1 58.0 (1) 26.2. (2) . 847.8 843.5 844.5 845.7. . 1 926.0 1 923.3 1 895.0 1 892.3 1 125 1.7 12 605 11 854. . 15.5 16.2. 15.4 15.4. 11.8 11.4. 11.2. Statement of comprehensive income (Rm) ,QFRPH 2SHUDWLQJH[SHQVHV 3URĔWDWWULEXWDEOHWRRUGLQDU\HTXLW\KROGHUV Headline earnings. 6WDWHPHQWRIĔQDQFLDOSRVLWLRQ /RDQVDQGDGYDQFHVWRFXVWRPHUV 5P Total assets (Rm) 'HSRVLWVGXHWRFXVWRPHUV 5P /RDQVWRGHSRVLWVDQGGHEWVHFXULWLHVUDWLR Average loans-to-deposits and debt securities ratio (%). Financial performance (%) 5HWXUQRQHTXLW\ 5R( Return on average assets (RoA) Return on risk-weighted assets (RoRWA) 6WDJHORDQVUDWLRRQJURVVORDQVDQGDGYDQFHV. Operating performance (%) Net interest margin on average interest-bearing assets Credit loss ratio on gross loans and advances to customers and banks 1RQLQWHUHVWLQFRPHDVSHUFHQWDJHRIWRWDOLQFRPH Cost-to-income ratio Jaws (IIHFWLYHWD[UDWH. Share statistics (million) 1XPEHURIRUGLQDU\VKDUHVLQLVVXH 1XPEHURIRUGLQDU\VKDUHVLQLVVXH H[FOXGLQJWUHDVXU\VKDUHV :HLJKWHGDYHUDJHQXPEHURIRUGLQDU\VKDUHVLQLVVXH 'LOXWHGZHLJKWHGDYHUDJHQXPEHURIRUGLQDU\VKDUHVLQLVVXH. Share statistics (cents). Capital adequacy (%) $EVD*URXS/LPLWHG $EVD%DQN/LPLWHG. Common Equity Tier 1 (%) $EVD*URXS/LPLWHG $EVD%DQN/LPLWHG. 8. Absa Group Limited Financial results for the reporting period ended 31 December 2019. 1 1 1 — 5 5. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. Headline earnings per ordinary share 'LOXWHGKHDGOLQHHDUQLQJVSHURUGLQDU\VKDUH Basic earnings per ordinary share 'LOXWHGEDVLFHDUQLQJVSHURUGLQDU\VKDUH 'LYLGHQGSHURUGLQDU\VKDUHUHODWLQJWRLQFRPHIRUWKHUHSRUWLQJSHULRG 'LYLGHQGFRYHU WLPHV NAV per ordinary share Tangible NAV per ordinary share.

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(18) 3 Normalised Group performance 59 6HJPHQWSHUIRUPDQFH 123 *URXS,)56SHUIRUPDQFH 142 Risk management 160 $SSHQGLFHV. 4 8 9 10 14 15 16. Overview Normalised salient features 1RUPDOLVHGVDOLHQWIHDWXUHVE\VHJPHQW 3URĔWFRPPHQWDU\ Basis of presentation 'LYLGHQGDQQRXQFHPHQW )LQDQFLDOVDQGQRWHVWRWKHĔQDQFLDOV. 60 61 64 66. :,0,VHJPHQWFKDQJH Overview Per market segment 3HUJHRJUDSKLFDOVHJPHQW. 68 90 106 122. 5%%6RXWK$IULFD CIB Absa Regional Operations +HDG2IĔFH7UHDVXU\DQGRWKHURSHUDWLRQV. &RQVROLGDWHGQRUPDOLVHGVWDWHPHQWRIFRPSUHKHQVLYHLQFRPH IRUWKHUHSRUWLQJSHULRGHQGHG'HFHPEHU. 1HWLQWHUHVWLQFRPH. Note. 2019 Rm. 5P. &KDQJH . . 46 306. . . ,QWHUHVWDQGVLPLODULQFRPH. . . . (IIHFWLYHLQWHUHVWLQFRPH 2WKHULQWHUHVWLQFRPH. 95 998 . . . (51 490). . . ,QWHUHVWH[SHQVHDQGVLPLODUFKDUJHV 1RQLQWHUHVWLQFRPH. . 33 655. . . 23 606. . . . (3 153). . . . (1 589) 5 419 1 600 536. . . . . . . (1 893). . . (319) . . . 221. . . 24 116 (6 310). . . . . . 16 003 1 016 352 435. . !. . . . 1 895.0 1 892.3. . . 1HWIHHDQGFRPPLVVLRQLQFRPH )HHDQGFRPPLVVLRQLQFRPH )HHDQGFRPPLVVLRQH[SHQVH 1HWLQVXUDQFHSUHPLXPLQFRPH 1HWFODLPVDQGEHQHĔWVLQFXUUHGRQLQVXUDQFHFRQWUDFWV &KDQJHVLQLQYHVWPHQWDQGLQVXUDQFHFRQWUDFWOLDELOLWLHV *DLQVIURPEDQNLQJDQGWUDGLQJDFWLYLWLHV *DLQVDQGORVVHVIURPLQYHVWPHQWDFWLYLWLHV 2WKHURSHUDWLQJLQFRPH 7RWDOLQFRPH ,PSDLUPHQWORVVHV 2SHUDWLQJLQFRPHEHIRUHRSHUDWLQJH[SHQVHV 2SHUDWLQJH[SHQVHV 2WKHUH[SHQVHV 2WKHULPSDLUPHQWV ,QGLUHFWWD[DWLRQ. . . 6KDUHRISRVWWD[UHVXOWVRIDVVRFLDWHVDQGMRLQWYHQWXUHV 2SHUDWLQJSURĔWEHIRUHLQFRPHWD[ 7D[DWLRQH[SHQVH. . 3URĔWIRUWKHUHSRUWLQJSHULRG 2UGLQDU\HTXLW\KROGHUV 1RQFRQWUROOLQJLQWHUHVWÝRUGLQDU\VKDUHV 1RQFRQWUROOLQJLQWHUHVWÝSUHIHUHQFHVKDUHV 1RQFRQWUROOLQJLQWHUHVWÝ$GGLWLRQDO7LHUFDSLWDO. (DUQLQJVSHUVKDUH %DVLFHDUQLQJVSHUVKDUH FHQWV 'LOXWHGHDUQLQJVSHUVKDUH FHQWV. . . 7KH*URXSKDVHOHFWHGWRFKDQJHLWVDFFRXQWLQJSROLF\WRQRORQJHUSUHVHQWRWKHULQWHUHVWH[SHQVHDQGVLPLODUFKDUJHVVHSDUDWHO\IURPLQWHUHVWH[SHQVHFDOFXODWHG XVLQJWKHHIIHFWLYHLQWHUHVWPHWKRG7KLVUHVXOWVLQPRUHUHOHYDQWLQIRUPDWLRQDVLQWKLVPDQQHUWKH*URXSDFKLHYHVFRQVLVWHQF\ZLWKLWVSHHUV7KHUHLVQRLPSDFWRQ WKH62&,DVWRWDORWKHULQWHUHVWH[SHQVHDQGVLPLODUFKDUJHVZDVQLO. 16. Absa Group Limited Financial results for the reporting period ended 31 December 2019. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. 3URĔWDWWULEXWDEOHWR.

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(22) 3 Normalised Group performance 59 6HJPHQWSHUIRUPDQFH 123 *URXS,)56SHUIRUPDQFH 142 Risk management 160 $SSHQGLFHV. 4 8 9 10 14 15 16. 60 61 64 66. Overview Normalised salient features 1RUPDOLVHGVDOLHQWIHDWXUHVE\VHJPHQW 3URĔWFRPPHQWDU\ Basis of presentation 'LYLGHQGDQQRXQFHPHQW )LQDQFLDOVDQGQRWHVWRWKHĔQDQFLDOV. :,0,VHJPHQWFKDQJH Overview Per market segment 3HUJHRJUDSKLFDOVHJPHQW. 68 90 106 122. 5%%6RXWK$IULFD CIB Absa Regional Operations +HDG2IĔFH7UHDVXU\DQGRWKHURSHUDWLRQV. &RQVROLGDWHGQRUPDOLVHGVWDWHPHQWRIFKDQJHVLQHTXLW\ IRUWKHUHSRUWLQJSHULRGHQGHG'HFHPEHU. %DODQFHDWWKHHQGRIWKHSUHYLRXV reporting period ,PSDFWRIDGRSWLQJQHZDFFRXQWLQJVWDQGDUGVDW -DQXDU\ ,)56 $GMXVWHGEDODQFHDWWKHEHJLQQLQJRIWKH reporting period 7RWDOFRPSUHKHQVLYHLQFRPH 3URĔWIRUWKHSHULRG 2WKHUFRPSUHKHQVLYHLQFRPH 'LYLGHQGVSDLGGXULQJWKHUHSRUWLQJSHULRG 7UDQVDFWLRQVZLWKQRQFRQWUROOLQJLQWHUHVWKROGHUV 'LVWULEXWLRQVSDLGGXULQJWKHUHSRUWLQJSHULRG ,VVXDQFHRI$GGLWLRQDO7LHUFDSLWDO 3XUFKDVHRI*URXSVKDUHVLQUHVSHFWRIHTXLW\VHWWOHG VKDUHEDVHGSD\PHQWDUUDQJHPHQWV (OLPLQDWLRQRIWKHPRYHPHQWLQ7UHDVXU\VKDUHVKHOGE\ Group entities 0RYHPHQWLQVKDUHEDVHGSD\PHQWUHVHUYH 7UDQVIHUIURPVKDUHEDVHGSD\PHQWUHVHUYH 9DOXHRIHPSOR\HHVHUYLFHV 'HIHUUHGWD[ 0RYHPHQWLQJHQHUDOFUHGLWULVNUHVHUYH 0RYHPHQWLQIRUHLJQLQVXUDQFHVXEVLGLDU\ UHJXODWRU\UHVHUYH 6KDUHRISRVWWD[UHVXOWVRIDVVRFLDWHVDQGMRLQWYHQWXUHV. General FUHGLW risk reserve Rm. . 89 124. 6 239. 823. —. —. (243). —. —. 840 193 —. 1 680 —. —. 88 881 15 895. 6 239 (965). 823 —. — —. — —. — —. 16 003 (108). — (965). — —. — — — —. — — — —. — — — —. — — —. — — — —. — — — —. —. —. (400). (62). —. —. —. —. 218 400. — —. — 155. — —. — — —. — — —. 400 — —. — — —. (400) (20). — — —. —. —. —. (89). 89. 89. — —. — —. — —. (6) (221). 6 221. — —. 843 530. . . 95 021. . 912. 6KDUH FDSLWDO Rm. 6KDUH premium Rm. 840 193. 1 680. —. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. %DODQFHDWWKHHQGRIWKHUHSRUWLQJSHULRG. Retained earnings Rm. 7RWDO RWKHU reserves Rm. Number of RUGLQDU\ VKDUHV ’000. 20. Absa Group Limited Financial results for the reporting period ended 31 December 2019.

(23) 124 125 133 138 140. 143 Risk management overview 155 Capital management. IFRS salient features Financials 1RWHVWRWKHĔQDQFLDOV Reconciliation Barclays separation. 161 162 163 170 172. Share performance Shareholder information and diary Glossary Abbreviations and acronyms Contact information. 2019 Capital and reserves Foreign 6KDUH $VVRFLDWHV attributable LQVXUDQFH based and joint WRRUGLQDU\ VXEVLGLDU\ HTXLW\ UHJXODWRU\ SD\PHQW ventures’ reserve reserve KROGHUV reserve Rm Rm Rm Rm. 1RQ 1RQ 1RQ FRQWUROOLQJ FRQWUROOLQJ FRQWUROOLQJ interest – interest – interest – Additional 7LHU RUGLQDU\ SUHIHUHQFH FDSLWDO VKDUHV VKDUHV Rm Rm Rm. Fair value WKURXJKRWKHU FRPSUHKHQVLYH LQFRPH reserve Rm. &DVKĕRZ KHGJLQJ reserve Rm. Foreign FXUUHQF\ translation reserve Rm. (80). 403. 3 065. . . . . . 4 644. . 112 853. —. —. —. —. —. —. (243). (13). —. —. (256). (80) (548). 403 913. 3 065 (1 330). —. —. —. 14 930. 922. 4 644 352. 435. 16 639. — (548). — 913. — (1 330). — —. — —. — —. 16 003 . 1 016 (94). 352 —. 435 —. . — — — —. — — — —. — — — —. — — — —. — — — —. — — — —. — — —. (614) 10 — —. (352) — — —. — — (435) 3 054. (10 343) 10 (435) 3 054. —. —. —. —. —. —. (462). —. —. —. (462). — —. — —. — —. — —. — 155. — —. 225 555. — —. — —. — —. 225 555. — — —. — — —. — — —. — — —. (400) (20). — — —. — (20). — — —. — — —. — — —. — (20). —. —. —. —. —. —. —. —. —. —. —. — —. — —. — —. 6 —. — —. — 221. — —. — —. — —. — —. — —. (628). 1 316. . 13. . 1 518. 106 328. . 4 644. . 121 840. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. 7RWDO HTXLW\ Rm. Absa Group Limited Financial results for the reporting period ended 31 December 2019. 21.

(24) 3 Normalised Group performance 59 6HJPHQWSHUIRUPDQFH 123 *URXS,)56SHUIRUPDQFH 142 Risk management 160 $SSHQGLFHV. 4 8 9 10 14 15 16. 60 61 64 66. Overview Normalised salient features 1RUPDOLVHGVDOLHQWIHDWXUHVE\VHJPHQW 3URĔWFRPPHQWDU\ Basis of presentation 'LYLGHQGDQQRXQFHPHQW )LQDQFLDOVDQGQRWHVWRWKHĔQDQFLDOV. :,0,VHJPHQWFKDQJH Overview Per market segment 3HUJHRJUDSKLFDOVHJPHQW. 68 90 106 122. 5%%6RXWK$IULFD CIB Absa Regional Operations +HDG2IĔFH7UHDVXU\DQGRWKHURSHUDWLRQV. &RQVROLGDWHGQRUPDOLVHGVWDWHPHQWRIFKDQJHVLQHTXLW\ IRUWKHUHSRUWLQJSHULRGHQGHG'HFHPEHU. %DODQFHDWWKHHQGRIWKHSUHYLRXV reporting period ,PSDFWRIDGRSWLQJQHZDFFRXQWLQJVWDQGDUGVDW -DQXDU\ ,)56 ,)56 $GMXVWHGEDODQFHDWWKHEHJLQQLQJRIWKH reporting period 7RWDOFRPSUHKHQVLYHLQFRPH 3URĔWIRUWKHSHULRG 2WKHUFRPSUHKHQVLYHLQFRPH 'LYLGHQGVSDLGGXULQJWKHUHSRUWLQJSHULRG 'LVWULEXWLRQVSDLGGXULQJWKHUHSRUWLQJSHULRG ,VVXDQFHRI$GGLWLRQDO7LHUFDSLWDO 3XUFKDVHRI*URXSVKDUHVLQUHVSHFWRIHTXLW\VHWWOHG VKDUHEDVHGSD\PHQWDUUDQJHPHQWV (OLPLQDWLRQRIWKHPRYHPHQWLQ7UHDVXU\VKDUHVKHOGE\ Group entities 0RYHPHQWLQVKDUHEDVHGSD\PHQWUHVHUYH 7UDQVIHUIURPVKDUHEDVHGSD\PHQWUHVHUYH 9DOXHRIHPSOR\HHVHUYLFHV 'HIHUUHGWD[ 0RYHPHQWLQJHQHUDOFUHGLWULVNUHVHUYH 0RYHPHQWLQIRUHLJQLQVXUDQFHVXEVLGLDU\ UHJXODWRU\UHVHUYH 6KDUHRISRVWWD[UHVXOWVRIDVVRFLDWHVDQGMRLQWYHQWXUHV. General credit risk UHVHUYH 5P. . . . . — —. — —. . —. — —. —. —. —. . . —. — —. — —. — —. . — . — —. — — —. — — —. — — —. — —. — — —. — — —. —. —. . . —. —. —. —. . — —. — . — —. — — —. — — —. — —. — — —. . — — —. —. —. —. . . . — —. — —. — —. . . — —. . . . . . . 6KDUH capital 5P. 6KDUH SUHPLXP 5P. . . — —. WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. %DODQFHDWWKHHQGRIWKHUHSRUWLQJSHULRG. Retained earnings 5P. Total RWKHU UHVHUYHV 5P. 1XPEHURI RUGLQDU\ VKDUHV à. 22. Absa Group Limited Financial results for the reporting period ended 31 December 2019.

(25) 124 125 133 138 140. 143 Risk management overview 155 Capital management. IFRS salient features Financials 1RWHVWRWKHĔQDQFLDOV Reconciliation Barclays separation. 161 162 163 170 172. Share performance Shareholder information and diary Glossary Abbreviations and acronyms Contact information. Foreign insurance 6KDUH Associates VXEVLGLDU\ based DQGMRLQW UHJXODWRU\ SD\PHQW YHQWXUHVà UHVHUYH UHVHUYH UHVHUYH 5P 5P 5P. &DSLWDODQG UHVHUYHV attributable WRRUGLQDU\ HTXLW\ KROGHUV 5P. 1RQ 1RQ 1RQ controlling controlling controlling LQWHUHVWÝ LQWHUHVWÝ LQWHUHVWÝ Additional RUGLQDU\ SUHIHUHQFH 7LHU VKDUHV VKDUHV capital 5P 5P 5P. )DLUYDOXH WKURXJKRWKHU FRPSUHKHQVLYH LQFRPHUHVHUYH 5P. &DVKĕRZ KHGJLQJ UHVHUYH 5P. Foreign FXUUHQF\ translation UHVHUYH 5P. . . . . . . . . . . . —. — —. — —. — —. — —. —. . —. — —. — —. . . . . —. —. —. . . . . . — . — . — . — —. — —. — —. . . —. —. . — — —. — — —. — — —. — — —. — — —. — — —. — —. — —. — —. — . . —. —. —. —. —. —. . —. —. —. . — —. — —. — —. — —. — . — —. . — —. — —. — —. . — — —. — — —. — — —. — — —. . — — —. — . — — —. — — —. — — —. — . —. —. —. —. —. —. —. —. —. —. —. — —. — —. — —. —. — —. — . — —. — —. — —. — —. — —. . . . . . . . . . . . WorldReginfo - 2a8b73c6-0fd6-46a9-8a14-7a3e116e61d4. Total HTXLW\ 5P. Absa Group Limited Financial results for the reporting period ended 31 December 2019. 23.

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