Pillar 3 quarterly disclosures as at 30 September 2017 FirstRand Limited (Incorporated in the Republic of South Africa) (Registration number 1966/010753/06) JSE ordinary share code: FSR Ordinary share ISIN: ZAE000066304 JSE B preference share code: FSRP B preference share ISIN: ZAE000060141 NSX ordinary share code: FST (FSR or the group) FirstRand Bank Limited (Incorporated in the Republic of South Africa) (Registration number 1929/001225/06) JSE company code interest rate issuer: FRII JSE company code debt issuer: FRD JSE company code ETF issuer: FRLE (FRB or the bank) PILLAR 3 QUARTERLY DISCLOSURES AS AT 30 SEPTEMBER 2017 In accordance with Pillar 3 of the Basel Accord, Regulation 43(1)(e) of the Regulations relating to Banks requires the group to disclose quarterly information on its capital adequacy, leverage and liquidity ratios. The figures below have not been reviewed or reported on by the group’s external auditors. CAPITAL ADEQUACY The capital positions (excluding unappropriated profits) for the group and bank for the quarter ended 30 September 2017 are set out below. R million FSR FRB Common Equity Tier 1 capital Ordinary share capital and premium 8 016 16 808 Qualifying reserves 96 703 63 414 Non-controlling interests 1 136 - Regulatory deductions (4 076) (1 096) Total Common Equity Tier 1 capital 101 779 79 126 Total Additional Tier 1 capital 4 343 1 500 Total Tier 1 capital 106 122 80 626 Tier 2 capital Tier 2 instruments 20 134 20 133 Other qualifying reserves 1 338 573 Regulatory deductions (4 234) (78) Total Tier 2 capital 17 238 20 628 Total qualifying capital and reserves 123 360 101 254 Total minimum capital requirement per risk type: Credit 55 921 46 901 Counterparty credit 1 556 1 484 Operational 12 630 10 007 Market 2 389 2 069 Equity investment 2 805 779 Other assets 3 274 2 526 Threshold items 1 655 547 Total minimum capital requirement 80 230 64 313 Common Equity Tier 1 capital ratio 13.6% 13.2% Tier 1 capital ratio 14.2% 13.5% Total capital ratio 16.5% 16.9% Notes: - FRB includes foreign branches and subsidiaries. - Excludes unappropriated profits. - The disclosed minimum capital requirement excludes the bank- specific individual capital requirement and add-on for domestic systemically important banks, and is reported at 10.75%. - There is currently no requirement for the countercyclical buffer add-on in South Africa. The current countercyclical buffer requirement from other jurisdictions that the group operates in is immaterial. - Threshold items relates to investments in financial, banking and insurance entities, and deferred tax relating to temporary differences. LEVERAGE The leverage ratios for the group and bank for the quarter ended 30 September 2017 and preceding three quarters are set out below. FSR Tier 1 Total Leverage R million capital exposure ratio(%) September 2017 106 122 1 334 733 8.0% June 2017 96 788 1 280 249 7.6% March 2017 96 559 1 277 723 7.6% December 2016 90 034 1 252 265 7.2% FRB Tier 1 Total Leverage R million capital exposure ratio(%) September 2017 80 626 1 201 651 6.7% June 2017 74 065 1 149 027 6.4% March 2017 74 376 1 142 819 6.5% December 2016 70 097 1 123 943 6.2% Notes: - FRB includes foreign branches and subsidiaries. - Actual closing balances used at each reporting period. - Ratios exclude unappropriated profits. - The increase in the leverage ratio from the previous quarter relates to the appropriation of profits in FSR and FRB, increasing Tier 1 capital. The total exposures increase mainly relate to on- balance sheet exposures relating to loans, short term securities, and investment and trading securities. LIQUIDITY The liquidity coverage ratio (LCR) is the first minimum standard for funding and liquidity under the Basel III regime. The objective of the LCR is to promote short-term resilience of a bank’s liquidity risk profile by ensuring that the bank has sufficient unencumbered high quality liquid assets (HQLA) to survive the net cash outflows expected during a significant stress scenario for 30 calendar days. Regulation 26(12)(a)(vi) requires banks to continuously meet their liquidity needs by calculating the LCR from 1 January 2015 on both a solo and consolidated basis. Regulation 43(e), read with the relevant directives, specify quarterly disclosure of the LCR. LCR compliance is on a phased-in basis, beginning with a 60% minimum requirement from 1 January 2015 with 10% incremental increases each year to 100% on 1 January 2019. The requirement effective from 1 January 2017 is 80%. The average LCR for the group and bank for the quarter ended 30 September 2017 are set out below. FSR FRB HQLA(R billion) 168 155 Net cash outflows (R billion) 183 154 Required LCR 80% 80% Actual LCR 92% 101% The group seeks to exceed the minimum LCR requirement in a sustainable manner and to hold a sufficient buffer to allow for volatility as determined by the group’s own internal liquidity risk appetite. FRB has applied for the committed liquidity facility (CLF) from the SARB for the calendar year 2017 as provided for under guidance note 5 of 2015 and 6 of 2016. The CLF was recognised as qualifying collateral for LCR purposes within the bank’s HQLA and subject to prescribed haircuts as required by the SARB. The group manages the HQLA portfolio of level 1 and level 2 assets. Notes: - FRB excludes foreign branches. - The consolidated LCR for the group (FSR) includes FRB’s South African operations and foreign branches, as well as all registered banks within the group. - The surplus HQLA holdings by subsidiaries and foreign branches in excess of the minimum required LCR of 80% have been excluded in the calculation of the consolidated group LCR. - The LCR is calculated on a simple average of 92 days of daily observations over the previous quarter ended 30 September 2017 for FirstRand Bank’s South African operations and London Branch, FNB Namibia and FNB Botswana. The remaining banking entities are based on month-end values. This announcement is also available on the group’s website: https://www.firstrand.co.za/ Sandton 28 November 2017 Sponsor RAND MERCHANT BANK (a division of FirstRand Bank Limited) Date: 28/11/2017 10:33:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 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