1. 07 December 2010 FINANCIAL SECTOR CODE

2. 07 December 2010 Agenda  Where are we in the gazetting process?  Who does it apply to?  What has changed?

3. 07 December 2010 Gazetting - Where are we?  Public commentary for phase 2 closed on the 1 st May  Comments will now be reviewed by the dti / Council  Following comments some changes may be made to the document  Submitted to dti for final gazetting as a Section 9(1) Sector Code

4. 07 December 2010 Who does it apply to?  The FS Code applies to –Banking; –Long-term insurance; –Short-term insurance; –Re-insurance; –Asset Managers; –Managers of formal collective investment schemes; –Financial Services Intermediation and Brokerage –Underwriting Management Agents –Private equity fund managers –Members of any exchange licensed to trade equities or financial instruments

5. 07 December 2010 WHAT HAS CHANGED

6. 07 December 2010 Exempted Micro-Enterprise  Annual Total Revenue of R5 million or less  Deemed to have B-BBEE Status of Level 4 = 100% procurement recognition  Direct black or black woman ownership greater than 50%: Level 3 = 110% procurement recognition

7. 07 December 2010 Qualifying Small Financial Institution  Designated investments of less than R50 million and with an annual Total Revenue of between R5 million and R35 million  A QSFI must select any five of the eight Elements

8. 07 December 2010 FSC Scorecard

9. 07 December 2010 Equity Equivalents  Available to any Financial Sector Company  Measurable against the value South African operations  Additional BEE Transaction Financing, Access to Financial Services, Targeted Investments, Enterprise Development, etc  Target local entities = 5% of value of company as at 31/12/2010  Target foreign branches = 25% of value of local entity as at 31/12/2010

10. 07 December 2010 Due to the Sector specific exclusions, financial institutions must at all times include within their portfolio of enterprise development programmes, initiatives targeting Black Owned property, brokerage and insurance intermediary businesses Preferential Procurement

11. 07 December 2010 Enterprise Development for enterprises exempt from Empowerment Financing

12. 07 December 2010 Enterprise Development for enterprises NOT exempt from Empowerment Financing  Contributions recognisable: –Grants, human capital support, direct costs

13. 07 December 2010 Empowerment Financing for Long-term insurers R17 billion in ADDITIONAL financing from 1/1/2012 to 31/12/2017

14. 07 December 2010 Access Target market  The target market for long-term and short- term insurance products will be based on income  tax threshold for individuals= R60,000 per annum and  double the tax threshold for families = R120,000

15. 07 December 2010  Products are for the priorities of retirement, death and serious illness  Minimum standards will be CAT standards, (CAT= fair Charges, easy Access, decent Terms) Access : long-term insurance

16. 07 December 2010 Access : short-term insurance Product range expanded to: Motor Vehicle Household contents Home owners Black SME’s Agriculture Live Stock Co-operatives

17. 07 December 2010 SED Balance of 1% overall target allocated to Consumer Education