Quarterly Disclosure In Terms Of Regulation 43 Of The Regulations Relating To Banks Capitec Bank Holdings Limited Registration number: 1999/025903/06 Registered bank controlling company Incorporated in the Republic of South Africa JSE ordinary share code: CPI ISIN code: ZAE000035861 JSE preference share code: CPIP ISIN code: ZAE000083838 (“Capitec”) QUARTERLY DISCLOSURE IN TERMS OF REGULATION 43 OF THE REGULATIONS RELATING TO BANKS Capitec and its subsidiaries (“the group”) have complied with Regulation 43 of the Regulations relating to banks, which incorporates the requirements of Basel. In terms of Pillar 3 of the Basel rules, the consolidated group is required to disclose quantitative information on its capital adequacy, leverage and liquidity ratios on a quarterly basis. The group’s consolidated capital and liquidity positions at the end of the fourth quarter of the 28 February 2021 financial year end are set out below: 4th Quarter 2021 3rd Quarter 2021 28 February 2021 30 November 2020 Capital Capital Adequacy Adequacy R’000 Ratio %(2) R’000 Ratio % COMMON EQUITY TIER 1 CAPITAL (CET1) 27 872 626 35.8 26 507 455 30.7 Additional Tier 1 capital (AT1)(1) 25 897 0.1 51 794 0.0 TIER 1 CAPITAL (T1) 27 898 523 35.9 26 559 249 30.7 General allowance for credit impairment 647 835 774 832 TIER 2 CAPITAL (T2) 647 835 0.8 774 832 0.9 TOTAL QUALIFYING REGULATORY CAPITAL 28 546 358 36.7 27 334 081 31.6 REQUIRED REGULATORY CAPITAL(3) 8 558 137 9 513 242 (1) Starting 2013, the non-loss absorbent AT1 and T2 capital is subject to a 10% per annum phase-out in terms of Basel 3. (2) The new regulations relating to the capital requirements for banks’ equity investments in funds became effective on 1 January 2021. In terms of the new regulations, banks are allowed to adopt a look-through approach to calculate the risk weighted asset exposures for equity investments in funds. Capitec invests in money market unit trust (“MMUT”) investment funds, which are included in the scope of the new regulations. The underlying assets of MMUT investment funds are typically invested in a composition of Government Bonds, Treasury Bills and interest bearing deposits with banks. Up until 31 December 2020, the investments in these MMUT’s were classified as corporate investments and included under credit risk, which were risk weighted at a 100% risk weight. From 1 January 2021, these investments were classified as equity investments in funds and are now included under investment risk. Capitec adopted the look-through approach as outlined per the new regulations to calculate the risk weighted exposures of these investments, and the effective risk weighting of these funds amounted to 55% for the month of February 2021. This change, along with our continued strategy to invest in low risk weighted assets, contributed to a reduction in risk weighted assets during the fourth quarter of the 28 February 2021 financial year, and resulted in a higher Capital Adequacy Ratio. (3) This value is currently 11% of risk-weighted assets, being the Basel global minimum requirement of 8%, the Capital Conservation Buffer of 2.5% and the Domestic Systemically Important Bank (“D-SIB”) capital add-on of 0.5%, disclosable in terms of Directive 4 issued by the Prudential Authority on 27 August 2020. The Prudential Authority issued Directive 2 on 6 April 2020 and temporarily relaxed the Pillar 2A South African country-specific buffer of 1% to provide temporary capital relief to banks during this time of financial stress following the outbreak of the Covid-19 pandemic, in a manner that ensures South Africa’s continued compliance with the relevant internationally agreed capital framework. It is currently anticipated that the 1% Pillar 2A requirement will be reinstated on 1 January 2022. 4th Quarter 2021 3rd Quarter 2021 28 February 2021 30 November 2020 R’000 R’000 LIQUIDITY COVERAGE RATIO (LCR) High-Quality Liquid Assets 57 601 979 49 670 375 Net Cash Outflows(1) 2 342 837 2 254 621 Actual LCR Ratio 2 459% 2 203% Required LCR Ratio(2) 80% 80% (1) Capitec has a net cash inflow after applying the run-off weightings, therefore outflows for the purpose of the ratio are deemed to be 25% of gross outflows. (2) The Prudential Authority issued Directive 1 of 2020 on 31 March 2020 and temporarily relaxed the minimum LCR requirement on 1 April 2020 from 100% to 80%. The reason for the decrease is attributable to the current financial market turmoil due to Covid-19 where market liquidity has decreased, and banks expected to be under increased pressure to comply with the currently prescribed LCR requirements. 4th Quarter 2021 3rd Quarter 2021 28 February 2021 30 November 2020 R’000 R’000 NET STABLE FUNDING RATIO (“NSFR”) Total Available Stable Funding 136 500 427 136 206 928 Total Required Stable Funding 61 746 242 59 944 901 Actual NSFR Ratio 221.1% 227.2% Required NSFR Ratio 100% 100% 4th Quarter 2021 3rd Quarter 2021 28 February 2021 30 November 2020 R’000 R’000 LEVERAGE RATIO Tier 1 Capital 27 898 523 26 559 249 Total Exposures(1) 158 134 375 153 456 051 Leverage Ratio 17.6% 17.3% For the detailed LCR, NSFR and leverage ratio calculations refer to the “Banks Act Public Disclosure” section on our website at www.capitecbank.co.za/investor-relations By order of the Board Stellenbosch 13 April 2021 Sponsor - PSG Capital Proprietary Limited Date: 13-04-2021 07:06:00 Produced by the JSE SENS Department. 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