LONDON 30OCT2013

TRADE & INVESTMENT FORUMUK-COTE D’IVOIREPERSPECTIVES ONBANKING AND FINANCE

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MACRO ISSUESTHE OPORTUNITIES ARE CLEAR TO SEE

• There have been challenges. Let’s not dwell on them now• This month’s feedback from the IMF is more interesting

. . . . Macroeconomic performance in the first half of 2013 was better than expected, with continued strong gross domestic product (GDP) growth, and moderate inflation despite increases in some food product prices . . . . Clear progress has also been made in the implementation of structural reforms, especially to improve the business climate and strengthen the energy sector

• Forecast growth is very strong, whoever you listen to :- Growth (Real GDP % change) 2012 2013 2014

Government Forecasts 9.8 9.8 9.1

IMF Forecasts 9.8 8.5 8.0

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MACRO ISSUESFOREIGN DEBT / BANKING SECTOR

• Given concerted effort, debt now appearsmanageable.. Arrears cleared up with external creditors Private creditors agreed a combination of

rescheduling and new money The price recovered from 35% in March

2011 to as high as 97.4% since

• Banking sector is in recovery mode Legacy of non-performing loans but relatively well provisioned Capital-adequacy ratios remain above the prudential threshold African Development Bank is returning to its rightful home

Source : Bloomberg 29/10/2013

..and the market agrees

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IVORIAN BANKING SECTORREGULATORY ENVIRONMENT

• Banks in Cote d’Ivoire come under the prudential supervision of the Banque Centrale des Etats de l’Afrique de l’Ouest (BCEAO) which is Headquartered in Dakar

• BCEAO is integral to the West African Economic and Monetary Union - WAEMU

• Economic and monetary union across 8 states

• Fomenting stability and market discipline

• Single currency

Member Countries of WAEMU

Source : BCEAO website

Diamond Bank’s technology platform makes banking operations seamless between the four WAEMU states in which it operates today

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EXPORT TRADEIMPORT AND CURRENCY CONTROLS

> The XOF is pegged to the Euro The link has been clear and steadfast over

many years as the chart opposite shows Source : OANDA (January 2009 – date)

> Whilst the peg is not a BCEAO-wide solvency guarantee Contracts can be negotiated with some price certainty and for imports

priced in €, eliminate hedging costs XOF is a managed currency. The importer’s bank (wherever situated in

WAEMU) must wait for BCEAO to release FX. Banks can help here

IMPORT CONTROLS There are clear rules which must be adhered to governing what can be imported and the forms that need to be filled in.

CENTRALISED MANAGEMENT OF FOREIGN EXCHANGE

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IVORIAN BANKING SECTOROFFSHORE

> DBUK is a UK company with its own capital and governance arrangements

> It was the first bank to be authorised by the new UK Prudential Regulation Authority (PRA)

> DBUK’s parent is one of 8 systemically important banks operating in Nigeria, public quoted, profitable and growing strongly

> Focus on retail expansion in its home market and international presences in Benin, Senegal, Togo and of course Côte d’Ivoire and the UK

> For DBUK Côte d’Ivoire is a core niche market> Our Ivorian value proposition is set out in one of

the flyers that can be picked up at our stand

Several of the Ivorian Banks have associates operating offshore although very few banking groups have a full presence in both Abidjan and London.

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STRUCTURED SITUATIONSSTRUCTURED TRADE

• Agri commodity financing Very big business Valuable and desirable export crops Well established financing mechanisms

to cover annual trade cycle• Financing farmers locally• Using crop to secure loans against assigned

contracts or spot market sales to global commodity firms• Other Commodities (e.g. oil)

Similar arrangements and with financing linked to underlying trade cycle for product

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STRUCTURED SITUATIONSFUNDING FOR INVESTMENT

• Long lead times and repayment schedules Putting it out of reach for many commercial banks

• Specialists exist to fill the gap

Regional Development Banks – BOAD recent XOF 26m

Theocratic Development Banks – IDB recent XOF 84m

• And not just by lending money Investing in skills and

governance

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STRUCTURED SITUATIONSFUNDING FOR INVESTMENT

• There is always a local funding need as well Local banks (e.g. DBCI) have a key role to play

supporting local promoters and project partners• If there is an export credit agency involves there

will often be a portion of residual country risk 5 – 15% of the amount being lent Term country risk weighted 100% for capital

calculation purposes (vs 0% for export credit leg) Specialist and niche banks (e.g. DBUK) have a key

role to play in taking on these risks

THANK YOURollo GreenfieldCHIEF EXECUTIVE OFFICERDiamond Bank (UK) plc - London

Isaac FOLYMANAGING DIRECTORDiamond Bank SA, Côte d’Ivoire - Abidjan

Please visit us

• At our stand today

• At our UK offices tomorrow Appointments can be arranged today

• At our London and Abidjan offices any time in the future

THANK YOURollo GreenfieldCHIEF EXECUTIVE OFFICERDiamond Bank (UK) plc - London

Isaac FOLYMANAGING DIRECTORDiamond Bank SA, Côte d’Ivoire - Abidjan

Please visit us

• At our stand today

• At our UK offices tomorrow Appointments can be arranged today

• At our London and Abidjan offices any time in the future