Sharenet Sites 
Sharenet Sites
FSR / FSRP / FSPP / - FirstRand Limited - Trading Statement - June 2009 FirstRand Limited (Incorporated in South Africa) (Registration number 1966/010753/06) JSE Ordinary Share Code: FSR JSE ISIN: ZAE000066304 JSE "B" Preference Share Code: FSRP JSE ISIN: ZAE000060141 JSE "B1" Preference Share Code: FSPP JSE ISIN: ZAE000070900 NSX Ordinary Share Code: FSR ("FirstRand" or "the Group") TRADING STATEMENT - June 2009 When announcing results for the six months to December 2008, FirstRand highlighted to shareholders that it expected the macro environment, both domestically and globally, to deteriorate further. This scenario in fact played out even more negatively than the Group anticipated. Declining asset growth and further increases in bad debts, combined with the negative impact of faster than anticipated reducing interest rates on capital and endowment balances, continued to place pressure on the earnings of FNB and WesBank. Impairments remain in line with expectations, and the bad debt ratio is anticipated to be between 175 and 185 basis points for the year (dominated by retail). The Group anticipates that economic activity will remain subdued. The absolute severity of the cycle, combined with the current high levels of consumer debt, means that the benefit of reducing interest rates is still only expected to positively impact Group results in late 2009 or early 2010. The earnings from RMB, the Group`s investment banking franchise have come under significant pressure in the second half of the financial year: - As previously indicated, RMB expected further market price volatility in the legacy SPJI off-shore portfolios. In the second half of the financial year these portfolios incurred losses of R200 million. RMB still anticipates that these portfolios will return some value over the medium term. - In line with market conditions, Private Equity has not made any realisations since December 2008, and its associate earnings, which reflect the broader economy, are lower than previously anticipated. Consequently, Private Equity expects to report a loss for the second half. - The Fixed Income, Currencies and Commodities (FICC) business had a very poor second half. Strong sales and structuring income in the client facing businesses was offset by counterparty credit related impairments and losses in the fixed income trading and international lending portfolios. - The Investment Banking division continued to perform well. This was despite a significantly slower second half due to lower corporate activity, losses on the exit of marginal international activities and increasing credit related impairments. As a result of the above, RMB`s earnings for the year are expected to be approximately 50%-55% down on the comparative period. Momentum`s performance in the second half of the financial year was similar to the first half. FirstRand`s capital management strategy remains conservative. Economic risk is backed by Tier 1 capital. FirstRand Bank Holdings`(FRBH`s)capital adequacy ratios are robust with a current Tier 1 ratio of 11.5%, which is well in excess of the regulatory minimum and FRBH`s internal target, and overall capital adequacy is 13.6%. Momentum`s CAR cover of 1.4x is within the targeted range. When announcing results for the half year to December 2008 FirstRand indicated to shareholders that the performance for the year to June 2009 would be similar to the first half of the financial year (diluted pro forma normalised earnings per share decreased 23%). However, given the impact of the losses in the off shore portfolios and the poor performance of FICC, as well as the negative endowment effect, the Group now expects diluted pro forma normalised earnings per share for the year to 30 June 2009 to be down between 30% and 35% on the previous period. Barring any unforeseen negative market developments, the Group is reasonably certain that earnings expectations for the year to June 2009 compared to June 2008 will be as follows: Year to Earnings
June 2008 guidance for the year to June 2009 Actual earnings per share 218.2 cents -39% to -44% (EPS)* (R11.3bn) Actual headline earnings per 191.5 cents -28% to -33% share (HEPS)* (R9.9bn) Diluted pro forma normalised 184.4 cents -30% to -35% earnings per share (R10.4bn) * Comparative period includes Discovery The financial information on which this trading statement is based has not been reviewed or reported on by FirstRand`s auditors. Details of FirstRand`s results for the year ending 30 June 2009 are expected to be released on SENS and published in the press on or about 15 September 2009. Sandton 23 June 2009 Sponsor RAND MERCHANT BANK (A division of FirstRand Bank Limited) Date: 23/06/2009 08:00:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.
