Banking our next Million Customers Mobile Money Summit 21 – 22 November 2008 Bank South Pacific

The Need for Change… Only 12% of the population have bank accounts Only 17% of population have a mobile phone Majority of un-banked live in remote areas Expensive to establish Bricks & Mortar Branches though not out of the question Customer growth potential is significant Recent experiences Account growth has been significant Required investment to expand ATMs and EFTPoS networks Significant investment in network infrastructure

Positioning for Growth… Installed three new state of the art IBM i570 Servers (K6m) Established an in-house capability to manage our computer systems, communications and data networks Refreshed all PCs and servers (K2.5m) Undertaken a total revamp of our LAN, WAN and international networks Replaced our Teller system and introduced a new One View of the customer interface (K17.5m) Introduced affordable Smart Banking

Positioning for Growth… Investing heavily in specialist IT/EB training for our staff Significant investment in Electronic Banking Equipment: We now have 150 ATMs throughout PNG with another 30 on the way (K10m) We have over 2,000 active EFTPoS terminals We operate 38 Agencies in remote locations Launched an affordable Visa Debit Card product which is available to all customers The Visa Debit Card will help drive e-commerce in this country Launched Business and Personal Internet banking with ability to pay third parties

So… BSP is strongly positioned to capture future growth But… How do we cope with the increased account base in our branches? How do we further support those in remote regions? What are the best delivery channels? Who might be willing to partner with BSP?

So… (contd) BSP is strongly positioned to capture future growth How… Migrate more existing customers into electronic channels Provide a simple way for customers to pay into other accounts at either BSP or at other banks Provide innovative distribution solutions We need fast and reliable networks with an increasing need for greater bandwidth We need to ensure that the country has a sound core telecommunications infrastructure Phone, Mobile and Data networks need to be expanded to cover a greater proportion of the country

And… We need to be able to do this in a cost effective way and produce a return for all our stakeholders

BSPs Solution… Further investment in ATMs for 2009 (+30) Focus on Queue waiting times & ATM availability Improve customer management and account opening process by leveraging technology used for One View of the customer Enhance Pay Others facility on Internet Banking and add to Phone Banking Additional security for Internet Banking via 2FA Introduce Mobile phone top-ups from BSP ATMs Introduce new EFTPoS terminals to take advantage of new technologies AND…

BSPs Solution… SMS Banking and Mobile Phone Banking BSP is pleased to announce 2 new electronic services to PNG:

BSPs SMS Banking… Available on both B Mobile and Digicel Networks Very simple to use Single SMS number (BSP) Visit Branch to register Options available NOW: Balance enquiry on all linked accounts Last three transactions Future enhancements: Pay others – BSP to BSP (instant) Pay others – BSP to other Banks (overnight) Bill Pay Alerts (Pay deposits, daily balance etc.) Free registration and outbound SMS. Inbound SMS will be charged by the Carrier

BSPs Mobile Banking… BSPs Internet Banking has been completely rewritten to work on Web enabled Mobile Phones BSP did not short cut by simply saying use our existing site No phone specific software required just a mobile browser Very small packet size to increase speed & lower cost of delivery Automatic registration with Internet Banking Options available NOW: Balance enquiry on all linked accounts Transfers between linked accounts Transaction history Bill Pay (in branch registration) Capability to relay menu choices via wave file (phone will talk to you) Future enhancements: Share 2FA security with Internet Banking Integration with Internet Banking Pay others – BSP to BSP (instant) – in branch registration Pay others – BSP to other Banks (overnight) – in branch registration Reliant on implementation of GPRS for use on web enabled Mobile Phones Perfect solution for customers on dial up Internet (IB-Lite)