1. 30 July 2008 Agriconsultation on the Land and Agrarian Reform Programme Financing for Agricultural Development Presentation by Standard Bank

2. Presentation Outline Commercial Banks’ Responsibility Requirements for Success Challenges Conclusion

3. Commercial Banks’ Responsibility Financial Services Charter Commercial Banks are driven mainly by the requirements as set out in the FSC. Social Responsibility Banks also have a social responsibility towards the population of South Africa in ensuring sustainable transformation in Agriculture. Therefore we cannot only be driven by the FSC At Standard Bank we have identified other focus areas in order to ensure proper transformation in Agriculture. Responsibility to Shareholders Lastly, in complying to the FSC and fulfilling our social responsibility we also need to ensure that our shareholders receive the required return on their investments.

4. Require finance to acquire a stake in an existing business Have signed a contract and require start up capital BEE Needs Require expansion / working capital for an existing business BEE Funding Needs

5. Requirements for Success: Understanding the emerging market; Opportunities As emerging markets grow, many opportunities arise with that. Challenges Unfortunately the Banks are also faced with new challenges. One of the challenges in finding ways in which to finance farmers who did not have the opportunity to build a strong balance sheet. JV’s with Agri-Businesses & Industry Players; Partnering with Agribusinesses where they provide an off- take agreement in conjunction with mentoring on a continual basis Relationship with Dept of Agriculture / Land Affairs. Essential in order to leverage off all available funding.

6. Challenges: Land redistribution vs. Commercial viability; The viability of projects is of utmost importance to the success of transformation in Agriculture. The challenge lies in finding ways of increasing the viability of Land redistribution / restitution projects Traditional Lending Criteria vs. New focus; Traditional Criteria Balance sheet, Security, Repayment ability, Management expertise. New focus Focus more on Repayment ability and the management’s expertise behind the project. Management / Mentorship; In our financing structures we have to find ways of holding people who act as mentors/managers accountable for their actions.

7. Conclusion The most important factor when looking at financing structures and assessing projects in the repayment ability of the projects and the management behind the projects.

8. Thank you