1. About WEMA BANK Plc slide Financial Highlights slide The Offer slide Key Investment Considerations slide 17

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2 TABLE OF CONTENTS Sections 1. About WEMA BANK Plc slide 4 2. Financial Highlights slide 9 3. The Offer slide Key Investment Considerations slide Outlook and Strategy slide Key Contacts slide 25 2

3 Section 1 About WEMA Bank Plc

4 Introduction to WEMA Bank Plc Company Overview Continued improvements recorded in the retail space Widely reputed as the longest surviving indigenous bank in Nigeria, WEMA Bank has over the years, diligently offered a fully-fledged range of value-adding banking N30.37bn and financial advisory services to the Nigerian public The Bank offers a range of retail and SME banking, corporate banking, treasury, trade services and financial advisory to its ever-expanding clients % CREDIT RATINGS F3 by Fitch A3 by GCR In 2009, the Bank underwent a strategic repositioning exercise which culminated in a decision to operate as a commercial Bank with regional authorization in South- South Nigeria, South-West Nigeria, Lagos and Abuja in In 2015, the bank was granted a national banking license by the Central Bank of Nigeria. IMPROVED SERVICE RATING ISMS ISO certified 1.7mn CUSTOMER BASE BRANCH GROWTH NATIONAL LICENSE ALTERNATE CHANNELS The Bank operates a network of over 140 branches and service stations across Nigeria, backed by a robust ICT platform 4

5 Board Of Directors 5

6 Experienced Management Team Segun Oloketuyi (MD/CEO) Consumate banker with several years of banking and managerial experience. Until his appointment, he was an Executive Director, Skye Bank Plc with the responsibility for business development across Lagos and South-West directorates of the bank. He is an alumni of Lagos business school and a fellow of the Institute of Chartered Accountants of Nigeria (ICAN) Ademola Adebise (DMD) Experienced banker with over 28 years experience inclusive of 4 years in management consulting). Godwin Ehigiamusoe- MD/CEO He has worked in various capacities in Information Technology, Financial Control & Strategic Planning, Treasury, Corporate Banking, Risk Management and Performance Management He is an alumni of Lagos business school and a fellow of the Institute of Chartered Accountants of Nigeria (ICAN) Moruf Oseni (Executive Director) Executive Director of the Retail & North Directorate on the board of Wema Bank Plc. with responsibility for the Retail & SME business, E-business & Payments Prior to his board appointment, Moruf was the CEO of MG Ineso Limited, a principal investment and financial advisory firm with interests in various sectors of the economy. He is an alumni of Insead (France) and London business school Wole Akinleye (Executive Director) Experienced banker with over 20 years of cognate experience He is responsible for co-ordinating Business Development Activities in the South-West Region of Wema Bank. Prior to his board appointment, Wole was group head of Stanbic IBTC s business development He is an alumni of Obafemi Awolowo university and a fellow of the institute of Chartered Accountants of Nigeria (ICAN) Folake Sanu (Executive Director) Astute finance professional and banker of repute with over 32years working experience in banking, professional accounting and auditing practice Prior to appointment, Folake was Chief Financial Officer and later, Chief Compliance Officer of Sterling Bank where she was instrumental to the successful merger of 5 different banks to form Sterling Bank plc. She is an alumni of London Business school and a fellow of the Institute of Chartered Accountants of Nigeria (ICAN Oluwole Ajimisinmi (Company Secretary) Legal professional who bears the oversight responsibility of proffering opinions on all legal related issues including Prior to appointment, he was the Head; Legal Services Department of Skye Bank Plc, where he burnished his leadership skills, supervising the legal support provided for over 207 branches and 7 Regional Legal Offices.. He holds an LLB Degree with honours from the University of Jos, Plateau State, Nigeria and a BL Degree from the Nigerian Law School. 6

7 Recent History and Key Milestones 7

8 Section 2 Financial Highlights

9 Financial Highlights Earnings, Profit, Capital Revenue Generation H H FY Gross earnings N30.37bn 24.26bn N54.25bn PBT N1.43bn 1.30bn N3.28bn PAT N1.22bn 1.10bn N2.59bn CAR 12.74% 13.36% 11.07% Deposits (customer) H H FY N251.74bn N253.84bn N283.33bn Loans (net) N205.71bn N171.99bn N227.01bn Interest income N25.37bn N20.16bn N44.45bn Non-interest income N5.01bn N4.11bn N9.80bn Operating Efficiency Margin & Asset Quality H H FY Cost-to-income 89.30% 89.77% 88.32% Yield on Assets 15.95% 13.92% 15.65% Operating expenses N11.97bn N11.39bn N24.79bn H H FY Net interest margin 5.33% 6.71% 6.56% ROAE (annualised) 4.96% 4.73% 5.48% ROAA (annualised) 0.61% 0.56% 0.63% NPL (%) 4.91% 2.83% 5.07% Loan to deposits 81.72% 61.90% 80.12% Coverage ratio (%) % 101% % 9

10 Stable and Consistent Performance Total Asset Deposit (customer) Gross earnings ) Loans & advances (net) 11.53% ; 5yr CAGR (Assets), 10.20%, 4yr CAGR (Deposits); 11.88%; 4yr CAGR (Gross earnings)). CAGR indicative of the period

11 Efficiency External headwinds impacting on cost management Operating Expenses Cost-to-income Comments Operating expenses increased by 5.02% from N11.39 billion from N11.97 billion as at H Drivers for the increase were; High energy and power costs. Incremental costs from technology upgrades and licences. Cost to income declined marginally from 89.77% to 89.30%. We expect further streamlining of our processes, the continued on-boarding of customers on ALAT and migration of our customers to our alternative platforms should lead to reductions in our cost to serve. 11

12 N'bn Asset Quality & Earnings Trend Asset Quality Earnings Trend Efficient Risk Management culture evidenced by continued low NPL ratio Deposit Mix H1'2017 Deposit Mix FY' % 80.00% 70.00% 60.00% Term 47% Savings 22% Current 31% Term 56% Savings 17% Current 27% % 40.00% Deposit Mix H1'2017 Deposit Mix FY' % 20.00% Treasury Corporate3% 12% Treasury Corporate 6% 10% FY 2016FY H1'2017 Gross loans Net loans Loan to Deposit ratio 10.00% Retail 20% Commercial 65% Retail 16% Commerci al 68% Gross loans declined from N billion (2016FY) to N billion (H1 2017) due to paydowns and refinancing. NPL ratio closed at 4.91%, a decline from 5.07% as reported in 2016FY. Recoveries largely accounted for the reduction in NPL ratio during the period with the rest accounts recording repayments by customers. Coverage ratio (incl. risk reserve) remains robust at % (100%; 2016FY), ensuring level of provision remains adequate. Capital Adequacy Ratio (CAR) as computed under Basel II requirements increased during the review period from 11.06% (2016FY) to 12.71% as at H This was due to the reduction in quantum of risk weighted assets. The second tranche of tier II capital raise will open in Q3 17. Shareholders fund has grown at a 4 year CAGR of 4.04% from N41.40 billion as at 2013FY to N48.50 billion in 2016FY. 12

13 Section 3 The Offer

14 Indicative Term Sheet: Series I TERMS DESCRIPTION Issuer: Joint-Lead Arrangers/ Dealers: Placing Agents/ Dealers: Auditors: Registrars/Custodian: Solicitors: Face Value: Discounted Value: Wema Bank Plc Greenwich Trust Limited United Capital Plc Cowry Asset Management Limited Investment One Financial Services Limited Qualinvest Capital Limited Akintola Williams Deloitte (Chartered Accountant) Central Securities Clearing System PLC Aluko & Oyebode N10,000,000,000 N [ ] Nominal Amount Per Note: N1,000 Tenor: Currency of Issue: Use of Proceeds: Redemption: Maturity Date: Final Redemption Amount: Minimum Subscription: 182 days Nigerian Naira The estimated gross issue of N[ ] Billion will be utilized to support WEMA Bank s short term financing requirements and will be deployed to high-yield earning assets. As stated in the Applicable Pricing Supplement, subject to the CBN Guidelines [ ] N [ ] N5,000,000 and multiples of N1,000 thereafter Offer Opens: September [.] 2017 Offer Closes: September [.]

15 Indicative Term Sheet: Series II TERMS DESCRIPTION Issuer: Joint-Lead Arrangers/ Dealers: Placing Agents/ Dealers: Auditors: Registrars/Custodian: Solicitors: Face Value: Discounted Value: Wema Bank Plc Greenwich Trust Limited United Capital Plc Cowry Asset Management Limited Investment One Financial Services Limited Qualinvest Capital Limited Akintola Williams Deloitte (Chartered Accountant) Central Securities Clearing System PLC Aluko & Oyebode N15,000,000,000 N [ ] Nominal Amount Per Note: N1,000 Tenor: Currency of Issue: Use of Proceeds: Redemption: Maturity Date: Final Redemption Amount: Minimum Subscription: 271 days Nigerian Naira The estimated gross issue of N[ ] Billion will be utilized to support WEMA Bank s short term financing requirements and will be deployed to high-yield earning assets. As stated in the Applicable Pricing Supplement, subject to the CBN Guidelines [ ] N [ ] N5,000,000 and multiples of N1,000 thereafter Offer Opens: September [.] 2017 Offer Closes: September [.]

16 Section 4 Key Investment Considerations

17 Key Investment Considerations Strong Growth Potential Focus on growth in the short to medium term with aggressive growth strategies and market opportunities. Additional 120,000 retail accounts opened between Jan. Jun Savings deposit increased by 5.09% from N53.41 billion (2016FY) to N56.13 billion (H1 2017). Improved Revenue Streams Access to more revenue from Institutional and retail investors. Opportunities to exploit the unbanked through technological and social avenues. Experienced Management and Board The Bank is being managed by seasoned professionals with diverse experience in the Financial Services sector, with proven track record of sustaining businesses with winning strategies. Strong Profitability The Bank will be engaged in various business areas, providing diversified revenue streams that can drive profitability. Cost Management Ability to drive cost improvements through efficient staff and resourcing policies that will allow Wema Bank to achieve a competitive Cost to Income ratio. 17

18 Some product Offering of WEMA Bank Plc WemaOnline A web based application which provides real time access to account holders. WemaDebit & Credit Cards (MasterCard, Visa, Verve, Interswitch) partnership with global and domestic card issuers ensures seamless payments to our customers and non-customers WemaMobile A menu driven mobile banking solution which provides 24/7 access to an account holder via his/her mobile phone. *945# Allows Wema Bank account holders to initiate transaction via their mobile phones mcash An innovative solution designed to facilitate low value retail payments by providing an accessible electronic channel. Cash on the Go A novel initiative that allows the bank customers authorize 3 rd party cash withdrawal from any Wema Bank ATM. WebPay A consolidated web payment internet gateway which involves turning customers website to an e-commerce platform. Card Control A product offering unique to the Bank that takes card security to the next level above PIN by allowing customers choose when to render both card and PIN inactive/active via their mobile or online banking platforms IMTOs Wema Bank partners with MoneyGram and Western Union, two of the world s leading International Money Transfer Operators (IMTOs) ensuring safe, secured and quick remittances. 18

19 Section 5 Outlook and Strategy

20 Our Strategic Intent The key determinant of our strategy focus are centered around : Innovation and Technology, Innovation and technology Fostering Relationship Risk Mgt. National Footprint Fostering Relationships, Risk management and National Footprint. The 3 E s We strongly believe that these success factors would aid the attainment of our strategic objective, bordering on our 3Es: EXPERTISE EXCELLENCE EFFICIENCY Expertise, Excellence and Efficiency 20

21 The 3ES: Setting the Pace Strategic Objectives EXCELLENCE Tasks Grow deposit volume through Retail and Digital Partnerships. o Additional 120,000 retail accounts opened between Jan. Jun o Deposit volumes declined by N20billion in a bid to reprice balance sheet. o Savings deposit increased by 5.09% from N53.41 billion (2016FY) to N56.13 billion (H1 2017). Continued refreshing of existing branch network & additional strategic openings o Re-opened Kaduna branch with expansion plans underway at Aba, Warri & Enugu branches. Abule-Egba branch completed during the review period. Launched Nigeria s first fully digital Bank (ALAT). Improving service rating across the Bank by implementing the Purple Rules (service delivery) Charter. o Industry rating improved from 13th to 8th (KPMG). The Bank is expected to attain top-5 next year. EXPERTISE EFFICIENCY Continue deployment of alternate channels POS, ATMs, mobile applications. & agency banking o ATM deployment increased by 2.59% from Jan Jun to 277. o POS machines increased by 1.45% (Jan Jun. 2017) to 5588 o Number of active cards increased by 55.46% to over 350k. o Subscribers & transaction volume on USSD platform (945#) increased by 73.82% & % from Jan. Jun respectively. o Total of 2,517 merchants enrolled on mcash o Agency banking fully embedded into business model. Improving operational efficiency through increasing use of technology in processes o OPEX increased by 5.02% (Y-o-Y) in H and below June inflation rate of 16.10%. o Cost to income ratio at 89.30%; a decline of 0.47% from H o Net Interest Margins at 5.33%. 21

22 ALAT: The Future of Banking Since the launch of ALAT in May 2017, we have on-boarded over 26,000 customers as at June 30, ,737 Accounts opened ,360 transactions executed totaling N850M N N N 2,967 savings goals created across 1,762 customers with a total of N100.3 million N251,089, Total balance across all accounts. Upcoming Features 9 app revisions released to customers since launch Finger Print Login Refer a friend Card details recalled (local and international Sign up with a signature and selfie MORE partnership engagements underway QR Payments Recurring bill payments Foreign card issuances Cardless withdrawal 22

23 Guidance to attainment of Strategic goals: Customer Deposit growth 2016FY -0.58% 2017E 5% COMMENTS Deposit growth expected from continued brand acceptance. Positive contribution from ALAT. Retail Penetration (Personal Accounts share of Deposit) 2016FY 12.54% 2017E 15% COMMENTS Improved retail volumes from campus storms, the alliance with Telcos & Fintechs, mobile and digital banking (ALAT) Loan Growth 2016FY 22.31% 2017E 1%-2% COMMENTS Loan growth to slow as we monitor the domestic environment. Growth in Non-interest Income 2016FY 19% 2017E 15% COMMENTS Increased fee income driven by transaction turnover and retail volumes. Cost-to Income Ratio 2016FY 88.33% 2017E 80% COMMENTS Impact of further process improvements and growth in top line revenue. Net Interest Margin 2016FY 5% 2017E 6.5%-7.0% COMMENTS Benefits from improving deposit mix 23

24 Risk Management Outlook Risk Management remains at the core of our business model Government Remains key to economy Continuing Challenges in the Oil and Gas Sector Weakening of government revenues poses a threat to the fragile economic recovery. Despite some respite in the direction of oil prices, market remains volatile Domestic political risk is heightening due to the 2019 election cycle. Exchange Risk and Trade Finance opportunities Increasing A more conservative Inflation Rate and loan bookinterest Rate A gradual reduction in loan portfolio can be seen as loan pay downs exceed rate of risk asset creation in keeping with the Bank s more conservative stance Technology and Cyber-risks remain at the fore of operational risks and we continue to ensure these areas of the Bank are adequately resourced. There has been some respite in the paucity of Foreign Exchange as oil revenues improve and dollar liquidity has improved significantly 24

25 Section 6 Key Contacts

26 Confidentiality We are pleased to present for your consideration a proposed transaction described in this Presentation. Due to the proprietary nature of this presentation, please consider it to be confidential. You agree that this presentation is for your confidential use only and that neither its existence nor the terms thereof will be disclosed by you to any person other than your officers, directors, employees, accountants, attorneys and other advisors, and then only on a need to know basis in connection with the proposed transaction contemplated thereby and on a confidential basis. Disclaimer This presentation is for information and discussion purposes only. It should not be construed as an offer or commitment by Wema Bank Plc or any of their affiliates to enter into a transaction, nor does it attempt to describe all the relevant terms of the transactions referred to in it. Instead, this presentation is indicative and is intended to outline certain basic points of business understanding around which a transaction could be structured. Any subsequent offer by Wema Bank Plc to enter into a transaction will be made on the terms, and will be subject to the conditions, specified by it. If a transaction is entered into, this presentation will be superseded in its entirety by the final documentation, to the exclusion of all prior written and oral communications. The presentation should not, therefore, be regarded as containing any representations about the content of such terms or any other matter. Accordingly, Wema Bank Plc assumes no responsibility for the contents of this presentation, or for any written or oral communications in connection with it (or any prospective transaction). If a transaction is entered into, its terms will be found entirely in the final documentation for the transaction and this presentation may not be used to construe such terms. The Advisers have not independently verified any of the information contained herein. No representation or warranty, expressed or implied is made as to the accuracy or completeness of the information contained herein or any other written or oral communication transmitted or made available to any recipient. Wema Bank Plc or any of their representatives expressly disclaim any liability based, in whole or in part, on such information, errors therein or omission therefrom. 26

27 Contact Details Kenneth Ero Group Executive Capital Issues Greenwich Trust Limited T: +234 (0) T: E: Ken.Ero@gtlgroup.com Usoro Essien Investment Banking Greenwich Trust Limited T: +234 (0) T: +234 (0) E: Usoro.Essien@gtlgroup.com Babatunde Obaniyi Director, Capital Markets Tel: Mob: Babatunde.Obaniyi@unitedcapitalplcgroup.com Akinwale Bola Structured Trade & SME Finance Office: Mob: Akiinwale.Bola@unitedcapitalplcgroup.com 27

28 Thank You 28