290319 nitro 7 investor presentation signed off
TRANSCRIPT
WesBank ‐ a division of FirstRand Bank Ltd. An Authorised Financial Services and Registered Credit Provider. NCRCP20.
NITRO PROGRAMME (RF) LTDNitro 7Investor presentation3 – 5 April 2019
Strictly private and confidentialThis presentation does not represent an offer for sale or subscription of any notes. Please read the important information attached to this presentation, and ensure that the final
Programme Memorandum to be executed before auction date (and the risk factors contained therein) is read in full in conjunction with this presentation.
The information herein has been prepared solely for informational purposes and does not, nor is it intended to constitute, an offer to buy or sell or a solicitation of an offer to buy or sell anysecurity or instrument or to participate in any particular trading strategy. These materials and all information herein are highly confidential and may not be distributed, published, reproduced ordisclosed (in whole or in part) without the prior written consent of FirstRand Bank Limited (together with its affiliates and other associated companies, hereinafter referred to as “FirstRand”).
This presentation is being communicated only to persons who have professional experience in matters relating to investments and to persons to whom it may be lawful to communicate it to (allsuch persons being referred to as prospective Investors). This presentation is only directed at prospective investors and any investment or investment activity to which this presentationrelates is only available to prospective investors or will be engaged in only with prospective investors. Solicitations resulting from this presentation will only be responded to if the personconcerned is a prospective investor. Other persons should not rely or act upon this presentation or any of its contents.
No representation or warranty, express or implied, can be given with respect to the accuracy, completeness, sufficiency or usefulness of the information, or that any future offer of securities orinstruments will conform to the terms hereof. Any such offer would be made pursuant to a definitive Offering Circular prepared by the issuer (the “Offering Circular”) which would containmaterial information not contained herein and to which prospective investors are referred. In the event of any such offering, these materials and any information herein shall be deemedsuperseded and replaced in their entirety by such Offering Circular. Any decision to invest in such securities should be made solely in reliance upon the final form of the such Offering Circular(including information which is incorporated by reference therein). Changes to the assumptions made in this analysis may have a material impact on the returns or results shown by way ofexample herein. No representation is made that any returns or results indicated will be achieved or that all assumptions in achieving these returns or results have been considered or stated.Past performance is not necessarily indicative of future results. Accordingly, there can be no assurance that future results will not be materially different from those described herein. Price andavailability are subject to change without notice. FirstRand disclaim any and all direct or indirect liability relating to these materials, including without limitation any express or impliedrepresentations or warranties for, statements contained in, and omissions from, the information herein.
Any projections or other estimates in these materials, including estimates of returns or performance, are forward-looking statements based upon, among other things, certain assumptions andare preliminary in nature. Actual results are difficult to predict and may depend upon factors within or beyond the issuer’s or FirstRand’s control. Actual events may differ from those assumedand changes to any assumptions may have a material impact on any projections or estimates. Other events not taken into account may occur and may significantly affect the analysis. Therecan be no assurance that estimated returns or projections can be realized or that actual returns or performance results will not be materially lower than those estimated herein. Such estimatedreturns and projections should be viewed as hypothetical and do not represent the actual returns that may be achieved by an investor. Investors should conduct their own analysis, using suchassumptions as they deem appropriate, and should fully consider other available information, including the information described under “Risk Factors” in the Offering Circular, in making aninvestment decision. Neither FirstRand, nor the issuer or any of their respective agents or representatives make any representation nor have any of them given any advice concerning theappropriate regulatory treatment, accounting treatment, or possible tax consequences in connection with the proposed transaction. Prior to entering into any proposed transaction, you shoulddetermine, without reliance upon FirstRand, the issuer or any of their respective agents or representatives, the economic risks and merits, as well as the legal, tax, and accountingcharacteristics and consequences, of the transaction, and that you are able to assume these risks.
The distribution of these materials and the offer or sale of securities or instruments may be restricted by law. Additionally, transfers of any such securities or instruments may be limited by lawor the terms thereof. Persons into whose possession these materials come are required to inform themselves of, and comply with, any legal or contractual restrictions on their purchase,holding, sale, exercise of rights or performance of obligations under any transaction. Your receipt and use of the foregoing constitutes notice and acceptance of the foregoing.
Important information2
Table of contents 3
• Executive summary 4• About WesBank 5
• Business and market update 7• Credit performance update 8• Origination performance 9• Risk management, underwriting and bad debt performance 10
• Nitro Programme overview 13• Nitro 7 transaction 15
• Transaction features 16• Capital structure 17• Provisional portfolio summary 20• Transaction timeline and contact information 23
• Appendices 25• Summary of historic data and Nitro performance 27
• To date, FirstRand Bank (FRB), a wholly-owned subsidiary of FirstRand Limited, has successfullyexecuted 6 Nitro securitisations
• Nitro 7 represents the seventh securitisation of WesBank vehicle finance loans
• First transaction of the Nitro Programme (the Programme)
• The Programme was established for faster execution, time to market, standardiseddocumentation and leveraging economies of scale
• Secured with a portfolio of [R2 000] million of instalment sale agreements and [R60] million of cash
• Notes are rated by Moody’s Investors Services (Moody’s)
• Class A short-dated senior tranche has a legal final maturity of 13 months
• WesBank, a division of FRB, acts as originator, seller and servicer of the participating assets
• Rand Merchant Bank (RMB), a division of FRB, acts as arranger, debt sponsor, manager andadministrator
Executive summary4
WesBank is part of the FirstRand group
Group-wide functions
Retail and commercial banking, insurance
Corporate and investment banking
Instalment finance
Asset management
LISTED HOLDING COMPANY (FIRSTRAND LIMITED, JSE: FSR)
UK specialist bank
5
• WesBank represents the group’s activities in instalment credit, fleet management and related services in the retail, commercial and corporate segments of South Africa
• WesBank’s leading position in its chosen markets is due to its long-standing alliances with leading motor manufacturers, suppliers and dealer groups and strong point-of-sale presence
• WesBank is the partner of choice for over 60 leading international brands, including automotive OEMs, insurance providers and oil companies
• Total finance market share at Dec 2018:
• 39% (including TFS and VWFS)
• 30% (excluding TFS and VWFS)
• WesBank has consistently been rated first in the vehicle financing category of the PWC SA Banking Survey
WesBank is the market leader in vehicle and asset finance in South Africa
6
Motor – SA retailvehicle asset finance (VAF)
Corporate/commercial asset-backed finance and full maintenance leasing
Business and market update7
Business update
• Despite increased competitive pressures, remained disciplined in origination and pricing• Focused on credit quality and return profile• Continued to grow alliances• Pressure on retail NIR due to declining account volumes (tracking vehicle sales)
Key market
developments
• Decline in NAAMSA sales stats• Increase in replacement cycle of vehicles• Consumers shift to lower value vehicles• Greater demand in used vehicles• Higher vehicle price inflation
Credit performance update – Motor VAF SA (FirstRand Limited)
Source: WesBank.
78.4%
14.7%
2.1% 1.0% 2.0% 1.9%0%10%20%30%40%50%60%70%80%90%
0102030405060708090
Current Between 31and 60 days
Between 61and 90 days
Between 91and 120 days
120+ Classified
Delinquency analysis - Dec 2018R billion
Delinquency analysis - December12m averages (%) 2015 2016 2017 2018
Between 31 and 60 days 4 4.2 3.8 3.6
Between 61 and 90 days 1.5 1.6 1.7 1.7
Between 91 and 120 days 1.8 1.9 2.2 2.4
Classified 1.3 1.5 1.5 1.9
8
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
Jun-
14Ju
l-14
Aug-
14Se
p-14
Oct-1
4No
v-14
Dec-1
4Ja
n-15
Feb-
15Ma
r-15
Apr-1
5Ma
y-15
Jun-
15Ju
l-15
Aug-
15Se
p-15
Oct-1
5No
v-15
Dec-1
5Ja
n-16
Feb-
16Ma
r-16
Apr-1
6Ma
y-16
Jun-
16Ju
l-16
Aug-
16Se
p-16
Oct-1
6No
v-16
Dec-1
6Ja
n-17
Feb-
17Ma
r-17
Apr-1
7Ma
y-17
Jun-
17Ju
l-17
Aug-
17Se
p-17
Oct-1
7No
v-17
Dec-1
7Ja
n-18
Feb-
18Ma
r-18
Apr-1
8Ma
y-18
Jun-
18Ju
l-18
Aug-
18Se
p-18
Oct-1
8No
v-18
Dec-1
8
Motor (SA retail VAF) arrears
Normal 1+ Normal 2+ Normal 3+ Normal Classified Current RestructuredRestr 1+ Restr 2+ Restr 3+ Restr Classified Other
Motor (SA retail VAF) NPL % at 31 Dec 18: 6.72%
*
* Stage 3/NPLS.
• Margin pressure continued due to: • Increased competitive activity• Focus on originating lower-risk business, which is generally written at lower margins• New business origination mix change from fixed-rate to floating-rate business
• Dealers remain the main channel for origination
Origination update9
Source: WesBank.
-
20,000
40,000
60,000
80,000
100,000
120,000
Mar-0
9Ju
n-09
Sep-
09De
c-09
Mar-1
0Ju
n-10
Sep-
10De
c-10
Mar-1
1Ju
n-11
Sep-
11De
c-11
Mar-1
2Ju
n-12
Sep-
12De
c-12
Mar-1
3Ju
n-13
Sep-
13De
c-13
Mar-1
4Ju
n-14
Sep-
14De
c-14
Mar-1
5Ju
n-15
Sep-
15De
c-15
Mar-1
6Ju
n-16
Sep-
16De
c-16
Mar-1
7Ju
n-17
Sep-
17De
c-17
Mar-1
8Ju
n-18
Sep-
18De
c-18
-
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
Book
size
(R m
illion
)
New business growth vs book value (FirstRand Limited)
Book - WesBank Motor New Business - WesBank Motor
WesBank risk management10
Governance and compliance
• Centralised product function, aligned to FirstRand group frameworks and methodologies
• FirstRand Enterprise Risk Management oversees structures
• Business conducted in accordance with the National Credit Act
• Credit is responsible for development, implementation and monitoring of AML scorecards
Operations
• Manages Motor collections and administration functions following well-defined guidelines and procedures
• Early collections team deals with default accounts,according to differential rules.
• Upon collection failure accounts enter specialisedcollections, where vehicles are repossessed, uplifted (fully or partially recovered) or cleared for sale and sold via auction
• Accounts are written off and moved to bad debts department for further collections on shortfalls
WesBank default and collections process
Source: WesBank.
The account is written off after sale of the vehicle and further recovery is pursued
The customer is allowed 15 days to pay the arrears and release goods failing which the vehicle is sold at a public
auction and provision on the account is raised
Should the customer not rectify after a visitation, the goods are uplifted
Should no rectification take place, the account is referred to a field agent to visit the customer
The collector will attempt to phone the customer to rectify arrears
Defaulting accounts are clustered into a group according to differential risk rules
Flow chart of default process Collections value chainCLIENT
DEFAULTS
Knowledge management and quality assurance capacity planning
Asset remarketing
Field agents, tracers and specialised
recovery unit
Unpaid cluster
Early collections
Special recovery
unit
Specialisedcollections
Bad debts
11
Source: WesBank.
Credit scoring system/decision/rating• Centralised at WesBank head office• Automated credit assessment (ACAS)
improves turnaround time• Key aspects assessed by the scorecard
include:• Affordability• Applicant information• Credit bureau information• Finance structure• FirstRand account history
• Automated credit assessment for loans up to:• R3.5 million for low risk juristics• R2.0 million for higher risk juristics
• ACAS evaluates >99% deals by volume and >99% deals by value
• 30% approval rate
Consumer (81%)• Private Individual• Salary as major
source
Non-consumer (19%)• Self employed• Company• Commission as
major source
Application scorecards
RiskActual default rate
Retail fixed
Credit rating
Retail linked
Credit rating
Approve 1Low risk
1.48% B+ 1.05% BBApprove 2 4.01% B+ 3.38% B+Approve 3
Medium risk7.85% B 6.81% B
Approve 4 13.11% B 11.86% B
Approve 5 High risk 20.79% B- 18.80% B-
Decline 1 High risk -negotiable of merit 21.75% B- 20.26% B
Decline 2 Unacceptable risk 24.69% B- 27.40% B-
Decline 3 Policy declines -high risk 9.26% B 7.15% B
Not scored Not Scored 8.34% B 7.44% B
12
Nitro programme overview
Rationale for programme – faster execution and time to market of transactions, standardised documentation, economies of scale
PROGRAMME DOCUMENTATION FLOW
Programme memorandum• Structural backbone• General overview of the programme• Generic terms and conditions
Applicable transaction supplement • Each transaction will have its own transaction
supplement• Description of the offering• Specific structural features and priority of
payments• Specific terms and conditions• Unique investor considerations
Applicable pricing supplement• Contains the terms and conditions of specific
note
13
Nitro programme – key differences to Nitro 6
Co-mingling
Issuer • Single newly-established Issuer SPV company• Issuer SPV enters into one or more transactions as specified in the relevant applicable transaction supplement
• For each transaction, a security SPV will be established, which will hold, realise security for the benefit of secured creditors in respect of that transaction
• In respect of each transaction, the security SPV established in respect of that transaction will, in relation to that transaction only, furnish a limited recourse guarantee to the noteholders and other secured creditors of the issuer in relation to that transaction
• The issuer will indemnify the relevant security SPV in respect of claims made by the secured creditors under that guarantee • Obligations of the issuer to each security SPV arising from the relevant indemnity shall be secured by a security cession to
the security SPV of the issuer’s rights to the assets applicable to that transaction
• Secured creditors in respect of a transaction will have recourse only to the participating assets of the issuer in relation to that transaction and will not have recourse to the assets of any other transaction
• For each transaction a separate bank account will be opened• Each transaction will be administered as an independent transaction• Assets and liabilities relating to each transaction will be identified in the accounting records of the issuer, as being attributable
solely to that transaction, and will be contractually segregated from the assets and liabilities relating to each other transaction• For each transaction an investor report will be prepared
Security SPV
Programmeparties
• Issuer SPV – Nitro Programme (RF) Ltd• Servicer – WesBank• Originator and Seller – WesBank• Administrator – RMB• Board of Directors and Trustees - Quadridge Corporate Fiduciary and Secretarial Services• Transaction parties (Bank Account, Hedge counterparty, etc.) – appointed per transaction
14
Nitro 7 – key transaction counterparties
Role Counterparty Current long term rating* Rating trigger Possible trigger effects
Account bank FRB (RMB) Aaa.za A1.za Replacement
Servicer FRB (WesBank) Aaa.za A1.zaAccelerated sweepingCustomer notificationReplacement
Swap counterparty FRB Aaa.za A2.za Collateral posting
* Moody’s ratings as at 1 April 2019
WesBank
WesBankNoteholders
Sale of portfolio
Initial consideration
Principal and interest
Nitro Programme (RF) Ltd(Nitro 7)
FRB
Administrator
Quadridge Corporate Fiduciary and Secretarial Services RMB
Purchase price for the notes
Servicer
RMB
Swap counterpartyTrustee Account bank
Originator / seller ISSUER
15
Nitro 7 – key transaction features
Servicer strength
High quality collateral1
Robust structure
• Retail vehicle finance portfolio originated and serviced by WesBank• Granular provisional portfolio with average loan size of R 178 115 and average seasoning of 21 months2
• 100% prime-linked auto loans• Used 70.00% / new 30.0%• Private individual 84.2% / self-employed private Individual 15.8%• 45.64% of the portfolio (balloon and non-balloon capital) relates to agreements with a final balloon instalment, with 15.41% of the total capital
made up of only balloon exposure• Weighted average yield of 12.75% for the pool• Geographically diversified throughout South Africa
• Participating assets are transferred to Nitro 7• Class A note - legal final maturity of 13 months• Simple pass-through waterfall structure - single capital repayment mode• Prepayments are used to redeem noteholders• Credit enhancement of: Class A notes is 82%, Class B notes is 12%, Class C notes is 7%• Fully-funded cash reserve sized at 3% of aggregate principal balance of the participating assets on the issue date• Single cash reserve funded at inception to cover any liquidity shortfalls and asset write-offs. Cash reserve available at each quarter as part
of the available distribution amount• Estimated excess spread at closing of roughly 2.6%3
• FirstRand Bank Limited is currently rated Baa3 (Aaa.za)/P-3 (P-1.za) by Moody’s• WesBank is the market leader in the South African vehicle finance market• WesBank is an experienced servicer with six successfully paid in full domestic securitisations
1. All statistics are based on a provisional portfolio as at February 2019. The final portfolio is expected to have similar statistical properties.2. Average calculations are weighted by current outstanding balance.3. Estimated post-swap asset yield less estimated senior expenses and senior note interest expressed as a percentage of provisional portfolio.
16
Credit enhancement• Credit enhancement for Class A to Class B notes provided by the cash reserve, note subordination and
available excess spread• Benefits from an estimated average excess spread at closing of roughly 2.6%2
• Structured to pay interest and principal sequentially after payment of senior expenses• Interest and principal payments on Class C to E notes is subordinated to principal on Class A to Class B
notes as per pre-enforcement order of priority (refer to next slide)• Any losses due to insufficient cash flows will be subject to the following order:
• Covered by excess spread• Borne by the subordinated notes in reverse order of seniority
Cash reserve• Fully funded at closing from proceeds on sale of the Class E notes• At inception, cash reserve requirement is 3% of the aggregate principal balance of participating assets on
issue date• At each interest payment date, cash reserve required to be funded up to the following requirement:
• 3% of aggregate principal balance of participating assets on each determination date prior to suchinterest payment date
• Subject to a floor of 1% of aggregate principal balance of initial assets• Cash reserve available to support interest payments on Class A to Class B notes
Hedging strategy• Balance-guaranteed interest rate swap between FRB (swap counterparty) and Nitro 7
• Hedge basis risk between prime rate paying assets and JIBAR-paying liabilities• Swap counterparty will pay 3-month JIBAR on the notional outstanding of the notes and receive a
fixed rate from the issuer• Swap counterparty subject to collateral posting triggers from Moody’s
Nitro 7 – structural features of capital structure
1. Nominal credit enhancement (CE) excludes excess spread, and includes 3% cash reserve.2. Estimated post-swap asset yield less estimated senior expenses, senior note interest expressed as a percentage of provisional portfolio.
ASSETS LIABILITIES1
100%
21% nominal CE 82%
4% nominalCE 3%
3% nominal3%
VEHI
CLE
FINA
NCE
ASSE
TSCA
SH
RESE
RVE
70% nominal CE 12%
5% nominal CE 7%
Class AP-1.za
Class D Caa3.za
Class E [not rated]
Class B Aaa.za
Class CBa2.za
17
• Credit enhancement to the Class A to Class D notes will be provided by:• Excess spread• A cash reserve funded at inception with the proceeds of the Class E note• Note subordination
Nitro 7 capital structure
TrancheNational
scale rating (Moody’s)
Issuanceamount
(R million)
Credit enhancement
(%)2WAL1 Legal final
maturity date
Expected maturity
dateCoupon JSE
listing Status
A P-1.za(sf) [420] 82 0.58 20-May-20 31-Apr-20 3m JIBAR + [●] Listed Offered
B Aaa.za(sf) [1 400] 12 1.94 20-Jun-25 31-Oct-25 3m JIBAR + [●] Listed Offered
C Ba2.za(sf) [100] 7 2.91 20-Jun-25 31-Apr-22 3m JIBAR + [●] Listed Offered
D Caa3.za [100] 3 3.06 20-Jun-25 31-Apr-22 3m JIBAR + [●] Listed [Call Desk]
E [Not rated] [60]3 0 [N/A] 20-Jun-25 31-Apr-22 3m JIBAR + [●] Unlisted [Call Desk/Retained]
Total [2 060]
1. 15% CPR assumption, zero losses, zero defaults.2. Subordination and 3.0% cash reserve (excluding excess spread).3. Proceeds from the issuance of the Class E tranche are used to fund the cash reserve at [R60 million] at closing.
18
Nitro 7 – weighted average life and amortisation profile
Key assumptions for estimated weighted average life:• Portfolio is subject to a constant annual rate of
prepayment• Portfolio sold to the issuer is [R2 000 million]• Original outstanding balance of each class of
notes is equal to principal amount based on the provisional portfolio and capital structure
• There are no delinquent receivables or defaulted receivables during the life of the transaction
Note: Amortisation and credit enhancement profile based on 15% CPR. Key assumptions listed above. Credit enhancement levels includes note subordination and cash reserve(excludes excess spread).
0%10%20%30%40%50%60%70%80%90%100%
0.0
0.5
1.0
1.5
2.0
2.5
Feb-
19Ap
r-19
Jun-
19Au
g-19
Oct-1
9De
c-19
Feb-
20Ap
r-20
Jun-
20Au
g-20
Oct-2
0De
c-20
Feb-
21Ap
r-21
Jun-
21Au
g-21
Oct-2
1De
c-21
Feb-
22Ap
r-22
Estimated amortisation profile (R billion)
Class A Bal Class B Bal Class C Bal Class D BalClass A CE Class B CE Class C CE Class D CE
Annual CPR 7.5% 10.0% 15.0% 17.5% 20.0% 25.0%
Class A (years) 0.69 0.65 0.58 0.56 0.54 0.51
Class B (years) 2.34 2.18 1.94 1.83 1.74 1.59
Class C (years) 3.36 3.19 2.91 2.78 2.68 2.50
Class D (years) 3.56 3.31 3.06 2.81 2.81 2.56
19
Portfolio summary: Nitro portfolio comparison 20
Nitro 1 Nitro 3 Nitro 5 Nitro 6 Nitro 7 provisional pool1
Receivables (R million) 2 000 5 000 2 400 2 040 [3 000]
Number of agreements 24 709 42 833 19 541 12 183 16 843
Average outstanding capital balance (ZAR) 80 942 133 185 122 819 185 881 178 115
New / used split
- New 54% 46% 40% 36% 30%
- Used 48% 54% 60% 64% 70%
Weighted average loan-to-value 85% 87% 92% 92% 93%
Remaining term (months) 38 47 43 49 50
Seasoning (months) 19 9 25 22 20
Delinquency status Up to 30 days Up to 30 days Up to 30 days Up to 30 days Up to 30 days
Weighted average yield Prime - 0.6% Prime - 0.78% Prime + 1.6% Prime + 2.2% Prime + 2.5%
1. All statistics are based on a provisional portfolio as at 5 February 2019. The final portfolio is expected to have similar statistical properties.
Nitro 7 – provisional portfolio snapshot1
Original loan-to-value (R million)Receivable type Autoloans
Outstanding balance R 2 999 994 915.73
Number of receivables 16 843
Average current balance 178 115
Weighted average rate Prime + 2.5%
Weighted average original LTV 93%
Weighted average remaining term 50
Weighted average seasoning 20
Refer to the pricing supplement for additional provisional portfolio stratifications.1. All statistics are based on a provisional portfolio as at 5 February 2019. The final portfolio is expected to have similar statistical properties.
Summary pool information as at 5 February 2019
70%
30%
New/used
Used New
84%
16%
Private individualSelf-employed Private individual
46%54% Loan type
Instalment saleInstalment sale with balloon
0200400600800
1,0001,2001,400
0% -
15%
15%
- 30
%
30%
- 45
%
45%
- 60
%
60%
- 75
%
75%
- 90
%
90%
- 10
5%
105%
- 12
0%
21
Customer type
Balloon exposure 15%
Provisional portfolio snapshot1Top 10 manufacturers
Geographical distribution
Please refer to the pricing supplement for additional provisional portfolio stratifications.1. All statistics are based on a provisional portfolio as at 5 February 2019. The final portfolio is expected to have similar statistical properties.
Manufacturer Outstanding principal balance (R)
Outstanding principal balance (%)
Number of contracts
Number of contracts (%)
HYUNDAI 363 754 080 12.13% 2 111 12.53%FORD 326 144 384 10.87% 1 766 10.49%MERCEDES-BENZ 238 060 612 7.94% 876 5.20%BMW 231 180 824 7.71% 930 5.52%VOLKSWAGEN 200 079 803 6.67% 1 470 8.73%NISSAN 190 608 976 6.35% 1 165 6.92%TOYOTA 184 575 411 6.15% 1 125 6.68%RENAULT 184 424 732 6.15% 1 234 7.33%KIA 152 231 349 5.07% 1 005 5.97%MAZDA 135 419 277 4.51% 601 3.57%
6.52% 3.34%
48.35%
14.34%
3.47% 5.63% 3.87% 1.74%
12.73%
0%
10%
20%
30%
40%
50%
60%
Eastern Cape Free State Gauteng KwaZulu Natal Limpopo Mpumalanga North West Northern Cape Western Cape
22
• Roadshow: 3 – 5 April 2019 (Johannesburg and Cape Town)
• Target price guidance: [15 April 2019]
• Target issuance size: [R1.5bn – R2bn]
• Target auction: [25 April 2019]
• Target settlement: [3 May 2019]
• Auction will be uniform price sealed bid on issue margin relative to 3-month JIBAR
• Request investors to submit by 11:00am
• Maximum allocation per note/overall
• Spread required per note
• Staggered bids are acceptable
• Allocations will be on tightest spread first – marginal spread pro rated
• Final allocations will be reported to investors by 1:00pm
Transaction timeline and auction details23
Contacts
WesBank
Anushuya Gounden(Chief Financial Officer)
T 011 632 4629
Lizelle van Deventer(Head of Data and Analytics)
T 011 649 5375
FirstRand Group Treasury
Cameron Gough (Funding and Liquidity)
T 011 282 [email protected]
Silvia Caroto(Funding and Liquidity)
T 011 282 [email protected]
Kavir Narsai (Funding and Liquidity)
T 011 282 [email protected]
Rand Merchant Bank
Cynthia Heyneke (Distribution)
T 011 282 [email protected]
Anina van Aswegen(Structuring)
T 011 282 [email protected]
Burger van der Merwe(Legal)
T 011 282 [email protected]
FIRSTRAND INVESTOR RELATIONSwww.firstrand.co.za
24
Summary of key historical performance (prime-linked portfolio)
Source: WesBank.
0.00%1.00%2.00%3.00%4.00%5.00%6.00%7.00%8.00%9.00%
Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10
Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20
Q21
Q22
Q23
Q24
Q25
Q26
Static cumulative default rates (all vehicles)
2008 2009 2010 2011 2012 20132014 2015 2016 2017 2018
0.00%1.00%2.00%3.00%4.00%5.00%6.00%7.00%8.00%9.00%
10.00%
Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10
Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20
Q21
Q22
Q23
Q24
Q25
Q26
Static cumulative default rates (used cars)
2008 2009 2010 2011 2012 20132014 2015 2016 2017 2018
0.00%1.00%2.00%3.00%4.00%5.00%6.00%7.00%8.00%9.00%
Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10
Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20
Q21
Q22
Q23
Q24
Q25
Q26
Static cumulative default rates (new cars)
2008 2009 2010 2011 2012 20132014 2015 2016 2017 2018
20.00%
25.00%
30.00%
35.00%
40.00%
45.00%
50.00%
55.00%
60.00%
65.00%
Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10
Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20
Q21
Q22
Q23
Q24
Q25
Q26
Static recovery rates
2009 2010 2011 2012 20132014 2015 2016 2017 2018
25
Summary of key historical performance (prime-linked portfolio)
Source: WesBank.
Dynamic delinquencies
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
2008
Q1
2008
Q3
2009
Q1
2009
Q3
2010
Q1
2010
Q3
2011
Q1
2011
Q3
2012
Q1
2012
Q3
2013
Q1
2013
Q3
2014
Q1
2014
Q3
2015
Q1
2015
Q3
2016
Q1
2016
Q3
2017
Q1
2017
Q3
2018
Q1
2018
Q3
Dynamic prepayments (R billion)
Book Outstanding Principal Amount as at Date Prepayment (%)
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
2008
Q1
2008
Q3
2009
Q1
2009
Q3
2010
Q1
2010
Q3
2011
Q1
2011
Q3
2012
Q1
2012
Q3
2013
Q1
2013
Q3
2014
Q1
2014
Q3
2015
Q1
2015
Q3
2016
Q1
2016
Q3
2017
Q1
2017
Q3
2018
Q1
2018
Q3
1 - 30 DAYS 31 - 60 DAYS61 - 90 DAYS 90+ DAYS
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
0
500
1,000
1,500
2,000
2,500
3,000
Jan 2
008
Jun 2
008
Nov 2
008
Apr 2
009
Sept
2009
Feb 2
010
Jul 2
010
Dec 2
010
May 2
011
Oct 2
011
Mar 2
012
Aug 2
012
Jan 2
013
Jun 2
013
Nov 2
013
Apr 2
014
Sept
2014
Feb 2
015
Jul 2
015
Dec 2
015
May 2
016
Oct 2
016
Mar 2
017
Aug 2
017
Jan 2
018
Jun 2
018
Nov 2
018
New business production (million)Original Principal Amount of Loans Originated in MonthNumber of Loans Originated in Month (#)
26
0%
5%
10%
15%
20%
25%
30%
35%
40%
Approved 1Approved 2Approved 3Approved 4Approved 5 Declined 1 Declined 2 D3
New business production by risk2014
2015
2016
2017
2018
Nitro 4: Clean-up call exercised
• Clean-up call for Nitro 4 was exercised in April 2015,with the final redemption of all outstanding notesdue on the 14 May 2015
• CPR at maturity was 28.58%, averaging 29.28%over the duration of the transaction
• Nitro 4 performed very well with cumulative write-offs of 0.61% of the aggregate initial pool balance
Cumulative net lossCPR
Source: http://sasf.co.za/investorreports/ABS/AssetBacked_Nitro4.htm.
29.28%
0%
5%
10%
15%
20%
25%
30%
35%
40%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
Delinquency trendsBetween 31 and 60 days Between 61 and 90 daysBetween 90 and 120 days Greater than 120 daysClassified
6.91%
4.56%
0.61%
0%
1%
2%
3%
4%
5%
6%
7%
8%Delinquency (%) Non-Performing (%) Cummulative Write-offs (%)
27
Nitro 5: Clean-up call exercised
• Clean-up call for Nitro 5 was exercised inSeptember 2018, with the final redemption of alloutstanding notes due on the 20 September 2018
• CPR at maturity was 25.41%, averaging 24.33%over the duration of the transaction
• Nitro 5’s cumulative nett write off were 0.55% atthe end of the transaction
Cumulative net loss
Source: http://sasf.co.za/investorreports/ABS/AssetBacked_Nitro5.htm.
Delinquency trends
0%
5%
10%
15%
20%
25%
30%
35%
24.33%
CPR
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
Jun'15 Nov'15 Apr'16 Sep'16 Feb'17 July'17 Dec'17 May'18
Between 31 and 60 days Between 61 and 90 daysBetween 90 and 120 days Greater than 120 daysClassified
6.63%
5.16%
0.55%0.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%8.0%
Deliquency % Non Performing %Cumulative Net write offs (%)
28
Nitro 6• Closed in April 2018
• Class A notes have redeemed within the 1 year maturity
• Class B has begun amortising in line with the underlying portfolio, with 76% having redeemed thus far
• CPR has averaged 19.01% for the last 11 months
• Nitro 6 is performing well with cumulative net write-offsto date of roughly 0.068% as at 28 February 2019
Cumulative net loss
Source: http://sasf.co.za/investorreports/ABS/AssetBacked_Nitro6.htm.
Delinquency trends
CPR
0%
5%
10%
15%
20%
25%
30%
19.01%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%Between 31 and 60 days Between 61 and 90 daysBetween 90 and 120 days Greater than 120 daysClassified
4.04%
1.32%
0.068%0.0%0.5%1.0%1.5%2.0%2.5%3.0%3.5%4.0%4.5%
Deliquency % Non Performing %Cumulative Net write offs (%)
29
Notes30
Notes31
Notes32