MTB- FNS 0123312 ® ROGUEXD AUDITED FINANCIAL STATEMENTS For the year ended 31 December 2020

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME CHAIRMAN’S STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2020 Operating Environment The macroeconomic environment for the year ended 31 December 2020 was severely impacted by the debilitat- INFLATION ADJUSTED HISTORICAL ing effects of the Covid-19 pandemic, which caused major macroeconomic shocks not only in Zimbabwe, but Note 2020 2019 2020 2019 the world over. ZWL$ ZWL$ ZWL$ ZWL$

The Covid-19 pandemic slowed down trade across the world as supply chains were severely disrupted, while aggregate demand declined. Zimbabwe was not spared as both imports and exports slowed down to a record low level. The country’s trade deficit has remained negative since 2019, and purchasing power was eroded by Interest income 3 189 632 440 531 890 393 86 628 828 50 759 650 high inflation, regardless of the easing of annual inflation from 521.2% recorded in December 2019 to 348.6 Interest expense 3 ( 170 046 359) ( 426 957 244) ( 81 195 268) (44 610 648) % in December 2020. Net interest income 19 586 081 104 933 149 5 433 560 6 149 002

The economy declined by 4.1% in the midst of the aforementioned challenges. This was however above the Commission, fee income and other operating 4.1 256 793 515 453 171 233 160 211 855 36 280 602 forecast decline of 6.5% as a result of the economy’s response to policies instituted by fiscal and monetary income authorities to stabilize the economy. Profit on disposal of property and equipment 4.2 82 635 759 107 767 49 133 903 12 993 Non interest income 339 429 274 453 279 000 209 345 758 36 293 595 Despite the challenges related to Covid-19, the economy is projected to grow by 7.4% in 2021 on the back of an anticipated good agricultural season. According to the Central Bank, inflation is projected to close the year Operating income 359 015 355 558 212 149 214 779 318 42 442 597 below 10% as stability is expected to continue in response to fiscal and monetary measures. Operating expenditure 5 (303 368 386) ( 360 829 902) (195 756 675) (30 983 244) Business Overview Allowance for credit losses reversal/(ex- 9.6 38 460 170 193 215 014 (4 611 372) (2 307 935) The Bank reported a historical profit after tax of ZWL$7.2 billion for the year ended 31 December 2020, driven penses) by deliberate strategic initiatives undertaken by the Board and senior management. However, in restated hy- Operating profit 94 107 139 390 597 261 14 411 271 9 151 419 perinflation adjusted terms, the Bank recorded a loss of ZWL$2.7 billion. The Bank’s focus has been on growing value preserving assets and supporting the export sector, which not only provides a hedge against exchange Fair value adjustment of investment property 4.2 (5 848 030 529) 10 315 767 734 6 985 349 557 3 403 395 914 depreciation and inflation, but also results in sustainable profits going forward. (Loss)/profit before monetary gain and (5 753 923 390) 10 706 364 995 6 999 760 828 3 412 547 333 tax Capitalization Monetary gain 511 227 840 3 279 242 289 - - The Bank remained compliant with the revised regulatory minimum capital requirements of ZW$ equivalent (Loss) / profit before taxation (5 242 695 550) 13 985 607 284 6 999 760 828 3 412 547 333 of US$30 million. As at 31 December 2020, the Bank’s capital was equivalent to US$122.7 million using the prevailing interbank exchange rate. Tax Credit / (expense) 6.1 2 534 349 167 (2 975 724 360) 164 847 188 (684 391 840)

Risk Management (Loss) / profit for the year after taxation (2 708 346 383) 11 009 882 925 7 164 608 016 2 728 155 493 Effective risk management policies and procedures will continue to be pursued through the Board Committees, which include the Risk, Compliance & Capital Management Committee, Loans Review Committee and Audit Other comprehensive income less tax 22 244 966 1 077 211 70 057 879 18 301 991 Committee, which are supported by management committees, which include the Asset and Liability Committee Note: 10 & 6.3 (ALCO), Management Credit Committee, Enterprise-Wide Risk Management Committee, Management Loans Review and Operational Efficiency Committee. The Bank has a comprehensive risk management framework sup- Total comprehensive income for the year (2 686 101 417) 11 010 960 136 7 234 665 895 2 746 457 484 ported by well-documented policies and procedures to assist in the management of the major risk exposures, faced by the Bank, including credit risk, market risk, liquidity risk, strategic risk, compliance risk, cyber-security risk and other types of risks.

During the year under review, the Bank activated its Business Continuity Plans to ensure that normal service was offered to clients, whilst also safeguarding the health and safety of our employees, as well as protecting STATEMENT OF CHANGES IN EQUITY the interests of shareholders. Above these objectives, preserving operational and financial resilience remained FOR THE YEAR ENDED 31 DECEMBER 2020 critical.

Despite the unprecedented risks due to the coronavirus, the Bank’s employees have shown great fortitude and INFLATION ADJUSTED commitment as they have continued to support and service our customers. Share Retained Revaluation Non distributable capital earnings reserves reserves Total Corporate Governance ZWL$ ZWL$ ZWL$ ZWL$ ZWL$ Metbank Limited’s Board of Directors is committed to the principles of accountability, fairness, responsibility and transparency and believes that a sound governance structure engenders a successful company. The Board currently comprises of seven directors i.e.; an independent Non-Executive Chairman, 4 (four) Independent Year ended 31 December 2019 Non-Executive Directors and 2 (two) Executive Directors. In March 2020, Stella Mandimika was appointed to the Balance at beginning of the year 709 238 492 762 418 199 - 394 183 887 1 865 840 578 Board and subsequently, Mr. Chenjerai Daitai was appointed as an Independent Non-Executive Board member with effect from 30 November 2020. The Board and Management welcome Mrs. S. Mandimika, Mr. C. Daitai Total comprehensive income for the year - 11 009 882 925 1 077 211 - 11 010 960 136 and wish them well during their tenure. In May 2020 and October 2020 respectively, Advocate Hungwe retired from the board after serving for four years and Mr. E. Chawoneka retired as an Executive Director after serving Balance at end of the year 709 238 492 11 772 301 124 1 077 211 394 183 887 12 876 800 714 six years on the Board. We would like to thank them for their significant contribution to the Bank’s success. Year ended 31 December 2020 The Bank continues to pursue its strategic plan through focusing on financing property developments, mortgage financing and the traditional commercial banking. This strategy allows the Bank to satisfy its diverse customer Balance at beginning of the year 709 238 492 11 772 301 124 1 077 211 394 183 887 12 876 800 714 needs while increasing shareholder value. Settlement of preference shares ( 6 187 424) - - ( 6 187 424) Total comprehensive income for the period - (2 708 346 383) 22 244 966 - (2 686 101 417) Outlook

While uncertainty remains on the projected economic recovery path, Metbank Limited is well-positioned with a Balance at end of the period 703 051 068 9 063 954 741 23 322 177 394 183 887 10 184 511 873 strong capital and liquidity position allowing it to continue to support its customers. The Bank plans to continue to improve service delivery through the upgrade of e-banking and financial inclusion products, in line with the “new normal”, driven by digital banking. HISTORICAL Acknowledgements On behalf of the Bank, I express our sincere appreciation to all our clients for their continued support to the Share Retained Revaluation Non distribut- business. I also take this opportunity to appreciate the effort and dedication of the Bank’s Board of Directors, able Executives, Management and Staff. Thank you and may you continue with your dedicated efforts to steer the capital earnings reserves reserves Total Bank to unparalleled success. ZWL$ ZWL$ ZWL$ ZWL$ ZWL$

Year ended 31 December 2019 D. MARANDURE Balance at beginning of the year 28 661 768 30 810 868 - 15 929 772 75 402 408 CHAIRMAN Total comprehensive income for the year - 2 728 155 493 18 301 991 - 2 746 457 484

Balance at end of the year 28 661 768 2 758 966 361 18 301 991 15 929 772 2 821 859 892

Year ended 31 December 2020 AUDITORS OPINION These financial results should be read in conjunction with the full set of financial statements for the year ended Balance at beginning of the year 28 661 768 2 758 966 361 18 301 991 15 929 772 2 821 859 892 31 December 2020, which have been audited by HLB Zimbabwe. A qualified opinion was issued thereon with Settlement of preference shares ( 250 046) - - ( 250 046) respect of incorrect date of application of International Accounting Standard 21 (The Effects of Foreign Currency Total comprehensive income for the year - 7 164 608 016 70 057 879 - 7 234 665 895 Exchange Rates) on comparative financial information. The auditor’s report on these financial statements in- cluded Key Audit Matters (KAMs) and it is available for inspection at the Bank’s registered office. Balance at end of the year 28 411 722 9 923 574 377 88 359 870 15 929 772 10 056 275 741

STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2020 INFLATION ADJUSTED HISTORICAL Note 2020 2019 2020 2019 ZWL$ ZWL$ ZWL$ ZWL$ ASSETS Cash and cash equivalents 7 538 887 859 545 134 740 538 887 859 121 523 024 Financial assets held through profit or loss 8 9 673 048 42 614 650 9 673 048 9 499 782 Loans and advances to customers 9 205 446 053 825 792 559 205 446 053 184 088 083 Property and equipment 10 354 311 536 288 911 406 194 346 971 36 131 842 Investment property 11 10 413 200 000 16 353 590 966 10 413 200 000 3 645 590 126 Property held for sale 11 381 098 947 381 098 947 Right of use asset 12.1 2 562 190 - 2 562 190 - Other assets 13 212 006 253 301 666 004 199 986 170 46 847 369

TOTAL ASSETS 12 117 185 886 18 357 710 325 11 945 201 238 4 043 680 226

EQUITY AND LIABILITIES EQUITY AND RESERVES Share capital 17 703 051 068 709 238 492 28 411 722 28 661 768 Retained earnings 9 063 954 741 11 772 301 124 9 923 574 377 2 758 966 361 Revaluation reserves 23 322 177 1 077 211 88 359 870 18 301 991 Capital reserves 394 183 887 394 183 887 15 929 772 15 929 772 TOTAL EQUITY AND RESERVES 10 184 511 873 12 876 800 714 10 056 275 741 2 821 859 892

LIABILITIES Deposits from customers 14 745 307 679 1 227 815 804 745 307 679 273 708 275 Debentures 15 - 54 664 453 - 12 185 959 Deferred taxation 6.3 598 708 475 3 125 752 973 554 959 959 696 801 956 Other liabilities 16 586 188 433 1 072 676 381 586 188 433 239 124 144 Lease liability 12.2 2 469 426 - 2 469 426 -

TOTAL LIABILITIES 1 932 674 013 5 480 909 611 1 888 925 497 1 221 820 334

TOTAL LIABILITIES, EQUITY AND RESERVES 12 117 185 886 18 357 710 325 11 945 201 238 4 043 680 226

29 March 2021 MTB- FNS 0123312 ® ROGUEXD AUDITED FINANCIAL STATEMENTS For the year ended 31 December 2020

Notes to the Financial Statements For the year ended 31 December 2020 STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2020 INFLATION ADJUSTED HISTORICAL INFLATION ADJUSTED HISTORICAL 2020 2019 2020 2019 2020 2019 2020 2019 6 TAXATION ZWL$ ZWL$ ZWL$ ZWL$ ZWL$ ZWL$ ZWL$ ZWL$ Current income tax - 4 092 098 - 912 222 CASH FLOWS FROM OPERATING ACTIVITIES Deferred income tax /(credit) (2 534 349 167) 971 632 262 164 847 188 683 479 618 (Loss) / profit before taxation (5 242 695 550) 13 985 607 284 6 999 760 828 3 412 547 333 (2 534 349 167) 2 975 724 360 164 847 188 684 391 840

Adjustments for non-cash items: 6.1 Tax rate reconciliation Depreciation 6 597 905 20 896 667 3 554 283 1 686 517 Profit before tax (5 753 922 493) 10 706 364 995 6 999 760 828 3 412 547 333 Allowance for credit losses ( 38 460 170) ( 193 215 014) 4 611 372 2 307 935 Tax using standard rate (1 422 369 640) 2 756 888 986 1 730 340 877 878 730 938 Fair loss/(gain) on investment property 5 848 030 529 (10 315 767 734) (6 991 235 379) (3 403 395 914) Exempt income (82 635 759) - (49 133 903) - Profit on disposal of property and equipment (82 635 759) ( 107 767) ( 49 133 903) ( 12 993) Fair value adjustments and impairments 1 445 633 147 (2 656 310 192) (1 726 778 410) ( 876 374 448) Other non cash items - - (92 763) - Non-deductible expenditure (2 474 976 915) 2 875 145 565 210 418 624 682 035 350 Net effects of inflation adjustments 34 369 889 ( 28 472 434) - - (2 534 349 167) 2 975 724 360 164 847 188 684 391 840

525 206 844 3 468 941 002 (32 535 562) 13 132 878 6.2 Deferred tax The following rates were applied in computing deferred tax: Changes in operating assets and liabilities Deferred income tax 24.72% 24.72% Decrease / (increase) in advances and other assets 781 408 030 2 885 280 356 ( 179 281 408) (86 666 305) Deferred capital gains tax: (Decrease) / increase in deposits and other liabilities (1 023 660 527) (5 716 551 810) 806 477 733 198 824 245 Property acquired before February 2009 5% 5% Property acquired after February 2010 5% 20% Net cash generated from operating activities 282 954 347 637 669 548 594 660 763 125 290 818 Deferred income tax 24.72% 24.72% The capital gains tax rate on property acquired between February 2009 changed from 20% of capital gain to CASH FLOWS FROM INVESTING ACTIVITIES 5% on gross proceeds. Property acquired after February 2019 are now taxed at 5% of capital gain. Purchase of property and equipment and intangible assets ( 76 983 795) ( 113 493 742) ( 68 776 230) ( 8 309 350) Purchase of investment property (389 433 920) ( 86 874 741) ( 221 349 868) - 6.3 Deferred tax liability Proceeds from sale property and equipment 183 403 911 2 851 434 113 080 216 299 010 Other Inflation adjusted deferred tax liability Balance at comprehensive Balance at Net cash utilised in investing activities (283 013 804) ( 197 517 049) ( 177 045 882) ( 8 010 340) 1 January 2020 Profit and loss income 31 December 2020 Analysis of temporary differences ZWL ZWL ZWL ZWL CASH FLOWS FROM FINANCING ACTIVITIES Investment property 3 088 077 828 (2 578 452 813) - 509 625 015 Redeemable preference shares ( 6 187 424) - ( 250 046) - Property and equipment 33 583 046 39 464 326 7 304 670 80 352 043 Property held for sale - 19 054 947 - 19 054 947 Net cash from financing activities ( 6 187 424) - ( 250 046) - Allowances for credit losses and provisions 4 092 098 ( 8 719 291) - (4 627 193) Right of use asset and liability - 584 152 - 584 152 Net (decrease) / increase in cash and cash equivalents (6 246 881) 440 152 499 417 364 835 117 280 479 Assessed tax loss - ( 6 280 489) - (6 280 489) Cash and cash equivalents at beginning of the year 545 134 740 104 982 241 121 523 024 4 242 546 3 125 752 973 (2 534 349 167) 7 304 670 598 708 475

Cash and cash equivalents at end of the period 538 887 859 545 134 740 538 887 859 121 523 024 Other Balance at comprehensive Balance at Comprising Historical cost deferred tax liability 1 January 2020 Profit and loss income 31 December 2020 Balances with the Reserve Bank of Zimbabwe 312 931 258 178 968 379 312 931 258 39 896 152 Analysis of temporary differences ZWL ZWL ZWL ZWL Balances with other banks and cash 225 956 601 366 166 361 225 956 601 81 626 872 Investment property 688 403 303 (178 778 288) - 509 625 015 538 887 859 545 134 740 538 887 859 121 523 024 Property and equipment 7 486 431 10 771 877 23 005 191 41 263 499 Property held for sale - 19 054 947 - 19 054 947 Allowances for credit losses and provisions 912 222 (5 539 415) - (4 627 193) Right of use asset and liability - 584 152 - 584 152 Notes to the Financial Statements Assessed tax loss - (10 940 461) - (10 940 461) For the year ended 31 December 2020 696 801 956 (164 847 188) 23 005 191 554 959 959

1. BASIS OF PREPARATION at par with the United States Dollar earned or incurred unless they relate 7 CASH AND CASH EQUIVALENTS (“USD”). Guidance issued by the Public to items already accounted for at fair 1.1 Reporting entity Accountants and Auditors Board (PAAB) value, with corresponding adjustment Balances with the Reserve Bank of Zimbabwe Metbank Limited provides commercial noted that the requirements of SI 33 presented in the statement of profit or Current account balances 309 942 011 175 805 917 309 942 011 39 191 167 banking services in Zimbabwe. were contrary to the provisions of IAS loss. A net monetary gain was recorded Cheque and Zimswitch coleteral 2 989 247 3 162 462 2 989 247 704 985 21. Therefore, the directors were unable in the statement of profit or loss. All Current account balances 312 931 258 178 968 379 312 931 258 39 896 152 It is a limited liability company which was to comply with the requirements of IRFS items in the statement of cash flows are incorporated in Zimbabwe in 1998. Its in respect of the comparative financial expressed in terms of the general price Balances with other banks and cash registered office is at 3 Central Avenue, information due to the conflict between index at the end of the reporting period. Central House, Harare, Zimbabwe. The IAS 21 and local statutory requirements. Placements with local banks 406 204 55 584 503 406 204 12 391 059 Cash and Nostro account balances 225 550 397 310 581 858 225 550 397 69 235 813 Bank changed its name from Metropolitan The conversion factors used to restate Bank of Zimbabwe Limited to Metbank 1.4 Functional and presentation currency the financial results are as follows: 225 956 601 366 166 361 225 956 601 81 626 872 Limited with effect from 30 April 2012. The financial statements are presented in Zimbabwe dollars (“ZWL”) which is the 538 887 859 545 134 740 538 887 859 121 523 024 1.2 Basis of accounting functional currency of the company. Indices Conversion Metbank Limited inflation adjusted factor 8 FINANCIAL ASSETS HELD THROUGH PROFIT OR LOSS financial statements of the year ended 1.5 Inflation adjustment 31 December 2020 2 474.51 1.00 31 December 2019 551.63 4.49 8.1 Analysis of movement 31 December 2020 have been prepared These financial statements have been in accordance with International prepared under the current cost basis Opening balance 42 614 650 383 391 761 9 499 782 15 493 640 Financial Reporting Standards (“IFRS”) in line with the provisions of IAS 29 – 1.6 Use of significant judgments and Additions 173 266 - 173 266 - as issued by the International Accounting Financial Reporting in Hyperinflationary source of estimate uncertainties Disposals - (340 777 111) - (5 993 858) Standards Board (“IASB”); the Zimbabwe Economies. PAAB pronounced In preparing these financial statements, Monetary Loss (33 114 868) - - - Companies and Other Business Entities that the economy is trading under management has made judgements, Act (Chapter 24:31); the Banking Act Closing balance 9 673 048 42 614 650 9 673 048 9 499 782 hyperinflationary conditions in line estimates and assumptions that affect (Chapter 24:20) and Banking Regulations; with IAS (Pronouncement 1/2019). The the application of the company’s Statutory Instruments SI33/99 and trustees have applied the guidelines 8.2 Maturity analysis SI62/99; the Exchange Control Act accounting policies and the reported provided by the PAAB and the relevant amounts of assets, liabilities, income Maturity within 1 month 5 098 917 - 5 098 917 - (Chapter 22:05), the Bank Use Promotion accounting bodies and made various Maturity after 1 month but within 6 months 4 574 131 29 279 062 4 574 131 6 526 974 and Suppression of Money Laundering and expenses. Actual results may differ assumptions to produce inflation adjusted from these estimates. Estimates and Maturity after 6 months but within 1 year - 13 335 588 - 2 972 808 Act (Chapter 24:24) as well as all Reserve financials. Bank of Zimbabwe directives. underlying assumptions are reviewed on 9 673 048 42 614 650 9 673 048 9 499 782 an ongoing basis. Revisions to estimates Metbank Limited adopted the Zimbabwe are recognised prospectively. The company’s inflation adjusted financial Consumer Price Index (“CPI”) as a general 9 LOANS AND ADVANCES TO CUSTOMERS statements have been prepared based price index to restate transactions and 9.1 Analysis 2. SUMMARY OF SIGNIFICANT on statutory records maintained under balances as appropriate. Non-monetary Loans 170 131875 566 235 894 170 131875 126 226 955 historical cost basis and are presented in ACCOUNTING POLICIES assets and liabilities carried at cost have Advances 52 281 639 314 984 297 52 281 639 70 217 217 Zimbabwe dollars (“ZWL”) 2.1. Changes in significant accounting been restated to reflect the change in 222 413 514 881 220 191 222 413 514 196 444 172 general price index from start to end of policies 1.3 IAS 21 – The Effects of Changes in the reporting period. There are a number of new standards 9.2 Allowances for credit losses Foreign Exchange Rates that became effective from 1 January Allowances for credit losses (note 9.6) (16 967 461) (55 427 632) (16 967 461) (12 356 089) As noted in the company’s 2019 financial Monetary assets and liabilities; and non- 2020, but none had a material effect on (16 967 461) (55 427 632) (16 967 461) (12 356 089) statements, Government promulgated monetary assets and liabilities carried at the company’s financial statements. Statutory instrument (“SI”) 33 on 22 revalued amounts have not been restated Net loans and advances 205 446 053 825 792 559 205 446 053 184 088 083 February 2019, giving legal effect to the as they are presented at the measuring 2.2 Significant accounting judgements, reintroduction of the Zimbabwe dollar unit current at the end of the reporting estimates and assumptions 9.3 Maturity analysis “ZWL” as legal tender and prescribed period. In the process of applying the Bank’s that for accounting and other purposes, Items reported in the statement of profit accounting policies, management has Maturity within 1 month 31 178 229 33 810 713 31 178 229 7 537 183 certain assets and liabilities on the or loss have been restated applying the exercised judgment and estimates in Maturity after 1 month but within 6 months 57 411 288 123 508 026 57 411 288 27 532 769 effective date would be deemed to be change in general price index from the determining the amounts recognised in Maturity after 6 months but within 1 year 25 894 204 100 931 752 25 894 204 22 500 000 Zimbabwe dollars at a rate which was dates when the transactions were initially the financial statements. Maturity after 1 year but within 5 years 90 962 332 567 542 068 90 962 332 126 518 131 205 446 053 825 792 559 205 446 053 184 088 083

Maturity is based on the remaining period from 31 December 2020 to contractual maturity. INFLATION ADJUSTED HISTORICAL

2020 2019 2020 2019 ZWL$ ZWL$ ZWL$ ZWL$ INFLATION ADJUSTED HISTORICAL 2020 2020 2019 2019 2020 2020 2019 2019 3 NET INTEREST INCOME ZWL$ % ZWL$ % ZWL$ % ZWL$ % Interest income from: 9.4 Sectoral analysis of loans Loans and advances 189 554 907 518 857 204 86 466 186 49 905 553 and advances Investment securities 77 533 13 033 189 162 642 854 097 Agriculture 64 751 745 29% 275 588 302 24.6% 64 751 745 29% 61 434 947 24.6% Construction 496 318 0% 31 797 530 8.3% 496 318 0% 7 088 398 8.3% 189 632 440 531 890 393 86 628 828 50 759 650 Distribution 59 969 965 27% 447 118 167 48.3% 59 969 965 27% 99 672 884 48.3% Individuals 14 767 825 7% 37 319 407 5.1% 14 767 825 7% 8 319 351 5.1% Interest expense on: Manufacturing 3 986 752 2% 500 976 0.9% 3 986 752 2% 111 679 0.9% Deposits from customers ( 170 046 359) ( 426 957 244) (81 195 268) (44 610 648) Services 40 760 283 18% 88 676 952 11.0% 40 760 283 18% 19 768 125 11.0% Mining 15 109 641 7% 139 228 1.8% 15 109 641 7% 31 037 1.8% (170 046 359) (426 957 244) (81 195 268) (44 610 648) Communications 8 910 0.0% 26 579 0.0% 8 910 0.0% 5 925 0.0% Transport 22 562 075 10% 53 050 0.0% 22 562 075 10% 11 826 0.0% Net interest income 19 586 081 104 933 149 5 433 560 6 149 002 222 413 514 100% 881 220 190 100.0% 222 413 514 100% 196 444 172 100.0% Allowances for credit losses 4 NON-INTEREST INCOME and suspended interest (16 967 461) (55 427 631) (16 967 461) (12 356 089) 4.1 Commission, fee income and other operating income 205 446 053 825 792 559 205 446 053 184 088 083 Commission and fee income 256 343 866 363 877 556 159 876 657 27 025 299 Other operating income 449 649 89 293 677 335 198 9 255 303 9.5 Non performing loans 256 793 515 453 171 233 160 211 855 36 280 602 Total loans and advances on which interest is suspended 5 082 695 19 360 949 5 082 695 4 315 999 4.2 Other income Fair value (loss) / gain on investment property (5 848 030 529) 10 315 767 734 6 985 349 557 3 403 395 914 9.6 Loan impairment Profit on disposal of property and equipment 82 635 759 107 767 49 133 903 12 993 Statement of financial posi- (5 765 394 770) 10 315 875 501 7 034 483 460 3 403 408 907 tion movement: Balance at beginning of the 55 427 631 248 642 645 12 356 089 10 048 154 5 OPERATING EXPENDITURE year Staff costs 103 561 834 122 076 980 60 700 843 8 797 158 Charge to profit or loss (38 460 170) (193 215 014) 4 611 372 2 307 935 Administrative expenses 188 286 421 211 845 478 128 574 395 19 980 818 Balance at end of the year 16 967 461 55 427 631 16 967 461 12 356 089 Auditor's fees 3 044 441 4 915 484 1 488 904 420 000 Directors' fees 1 877 785 1 095 293 1 438 250 98 750 9.7 Analysis of expected credit Depreciation and armotisation 6 597 905 20 896 666 3 554 283 1 686 518 losses Stage 1 651 769 1 724 398 651 769 384 408 303 368 386 360 829 902 195 756 675 30 983 244 Stage 2 8 121 429 24 684 215 8 121 429 5 502 677 OPERATING EXPENDITURE Stage 3 8 194 263 29 019 018 8 194 263 6 469 004 Included in staff costs are contributions to the National Social Security Authority, a defined contribution scheme and the Total expected credit losses 16 967 461 55 427 631 16 967 461 12 356 089 Bank's separate trustee administered fund amounting to ZWL$452,880 (2019: ZWL$112,548).

DIRECTORS: Mr. D. Marandure (Chairperson) | Dr. M. Maulana (Vice Chairperson) | Mrs. F. I. Muyambo | Mr. B. N. Ndebele (Managing Director) | Mrs. S. Mandimika | Mr. C. Daitai | Mr. E. Chawoneka* | Mr. G. Chiome* (*Executive) stronger together! 2 % 3% 0% 2% 2% 0% 0% ROGUEXD® MTB-FNS 0123312 0% ZWL ZWL 29% 17% 46% 0.4% 2019 2019 2019 2019 - - ZWL$ 100% - - 98 750 213 454 - - - - 185 699 250 131 5 458 590 3 367 568 8 816 659 2 243 004

- - 2 916 684 - - 3 102 383 11 726 741 29 204 552 - - 40 438 975 17 818 143 13 020 349 19 500 000 20 000 000 12 500 000 15 911 637 46 847 369 46 847 369 12 185 959 39 500 000 28 661 768 261 981 534 271 251 817 167 846 677 273 708 275 273 708 275 ------239 124 144 2019 ZWL$ 59 387 685 767 666 014 891 889 8 169 190 5 423 834 5 570 172 1 145 626 - - ZWL ZWL 78 563 913 47 480 600 2020 - - 2020 2020 ZWL$ HISTORICAL 125 051 883 - - 273 708 275 HISTORICAL COST HISTORICAL COST 418 787 107 311 372 301 964 713 400 618 8 305 637 2 187 771 2 097 125 2 962 808 2 469 426 2 562 190 ( 400 618) 1 438 250 8 724 424 % 2 469 426 11 190 522 19 500 000 20 000 000 15 911 637 12 500 000 10 197 508 23 311 885 98 926 347 77 747 938 77 747 938 1% 39 500 000 28 411 637 0% 0% 1% 0% 0% 0% 0% 172 496 862 264 319 023 138 182 026 138 182 026 735 110 171 743 012 597 37% 42% 17% 586 188 433 745 307 679 199 986 170 199 986 170 745 307 679 - - 2020 100% HISTORICAL

ZWL ZWL 2019 2019 ZWL$ 2019 - - 957 524 - - 833 018 - - 2020 ZWL$ - - 6 189 514 ------52 604 467 10 061 792 13 083 824 79 929 617 58 407 405 19 500 000 20 000 000 - - 1 095 293 15 106 422 39 550 261 13 916 842 54 664 453 39 500 000 367 728 977 273 181 403 400 752 935 959 393 735 151 309 313 827 - - 116 001 918 131 007 403 131 007 403 240 704 301 666 004 301 666 004 709 238 492 5 700 000 2 411 893 9 604 527 2 312 175 1 057 910 - - 1 175 211 337 1 216 796 488 stronger together! 1 227 815 804 1 227 815 1 227 815 804 1 227 815 1 072 676 381 1 072 676 381 279 066 543 315 870 410 127 698 516 745 307 679

% ZWL - - ZWL 3% 0% 2% 2% 0% 0% 0% 0% - - 2020 2020 2020 29% 17% 46% ZWL$ 2019 100% 107 311 372 301 964 713 400 618 697 722 2 187 771 2 097 125 2 962 808 2 469 426 2 562 190 ( 400 618) INFLATION ADJUSTED INFLATION INFLATION-ADJUSTED 2 469 426 INFLATION-ADJUSTED 35 331 968 35 331 968 98 926 347 10 197 508 77 747 938 77 747 938 1 877 785 13 837 632 11 190 522 19 500 000 20 000 000 735 110 171 743 012 597 14 535 354 39 500 000 745 307 679 212 006 253 212 006 253 745 307 679 172 496 862 264 319 023 138 182 026 138 182 026 393 737 241 309 313 827 - - 703 051 068 586 188 433 586 188 433 - - 2019 ZWL$ 266 402 2 987 643 5 139 113 3 076 252 4 000 885 36 645 807 24 330 536 24 986 987 352 426 371 212 991 116 560 964 692 1 227 815 804 % 1% 0% 0% 1% 0% 0% 0% 0% 37% 42% 17% 2020 100% INFLATION ADJUSTED INFLATION 2020 ZWL$ 367 728 977 273 5 700 000 2 411 893 9 604 527 2 312 175 1 057 910 240 704 240 704 279 066 543 127 698 516 315 870 410 315 870 410 745 307 679 Bank. These include the Managing Director, Executive Director ICT and Banking, Finance Director, Head Human Resources, Company Secretary, Secretary, Company Resources, Human Head Director, Finance Banking, and ICT Director Executive Director, Managing the include These Bank. Head of Compliance, Chief Internal Head Head Auditor, Operations, Treasury, Head Information Head Communication Retail Technology, Banking and Head Corporate Banking. Non Executive Directors' Fees fees Directors' and Balances Holding Company Transactions capital of the the acquisition Bank of on 60% 01 of the July 2007, ordinary Metbank share Limited is Following a subsidiary Finance of Loita no transactions between Metbank and the holding company during the period. were Holdings Limited, incorporated in Mauritius. There 000 000 to create room for issuance of additional preference shares, a process which was still being regularised with the Registrar of Companies of Registrar the with regularised being still was which process a shares, preference additional of issuance for room create to 000 000 shares. of the preference was given a mandate to effect the issuance of Directors as at 31 December 2020. The Board TRANSACTIONS PARTY RELATED Personnel Key Management Benefits to Management Personnel Key benefits and long term Short term employment benefits Post Key Key management personnel are those persons having authority and responsibility for planning, directing and the controlling activities of the DEBENTURES issued Debentures OTHER LIABILITIES Analysis of balances expenses Accrued Treasury bills Treasury Due to ZAMCO Other provisions SHARE CAPITAL SHARE CAPITAL Authorised of ZWL$0.10 each 195 000 000 ordinary shares 20 000 000 preference shares of ZWL$1 each shares 20 000 000 preference 15 911 637 irredeemable non-cumulative 15 911 637 irredeemable of ZWL$1 each shares preference 250 131 convertible cumulative redeemable of ZWL$1 each shares preference Issued and fully paid of ZWL$0.10 each 125 000 000 ordinary shares Non-cumulative preference shares balances whose depositors some with arrangements compromise into entered successfully Bank the 2015, December 31 ended year the During (EGM) Meeting General Extra-ordinary an of holding the to led proxies, signed of back the on arrangements, These 000. ZWL$100 above were to long creditors effectively converting short term and/or debentures shares 2015 which paved for way the issuance of preference on 2 March holding investors. (3 years) instrument term During the 2016 period , the Bank’s to Shareholders approved increase the number of authorised 15 shares from preference 000 000 to 20 Communications institutions Quasi-government Commercial Manufacturing Private Transport Distribution Mining Financial institutions and Financial lines of credit offshore Sectoral anlysis of customer depostis Construction Agriculture Current Split into: Non-current Balance at year end Opening balance All lease obligations are denominated in Zimbabwe dollars (ZWL). All lease obligations are Lease liability Lease Closing balance to the lease were recognised in profit or loss: The following amounts relating on lease liabilities expense Interest Depreciation Additions RIGHT OF USE ASSET AND LEASE LIABILITY RIGHT OF USE ASSET AND LEASE Right-of-use assets to five years. two years it operates as bank branches. The lease periods range from which The bank leases a number of properties Right of use property Depreciation expense on right-of-use assets expense Depreciation DEPOSITS FROM CUSTOMERS Analysis of balances and savings accounts Current Maturity on demand and within one month Withdrawals Prepayments Income receivable deposits Term 1 month and up to 3 months Work-in-progress - Property development - Property Work-in-progress Sundry debtors Other OTHER ASSETS 3 months and up to 1 year Notes to the Financial Statements Notes to the Financial 2020 the year ended 31 December For 12.2 12 12.1 14 14.1 14.2 13 18.2 18.3 18 18.1 15 16 16.1 17 17.1 17.2 17.3 14.3 3

Total ZWL Total Total ZWL$ 2019 ZWL$ (85 076) ( 31 227) ( 12 337) ( 12 337) ( 82 224) 1 686 517 1 686 517 6 605 053 6 597 904 6 597 904 3 554 283 6 850 177 7 805 396 ( 355 016) ( 317 245) 9 460 686 9 460 686 20 896 667 76 983 795 76 983 795 29 549 636 24 649 147 36 131 842 93 063 070 (4 913 021) (3 098 681) 68 776 230 68 776 230 14 655 573 13 002 633 36 131 842 45 592 528 45 592 528 5 140 604 362 653 710 113 493 741 213 687 000 288 911 406 574 584 104 193 145 349 502 598 406 502 598 406 213 687 000 220 272 567 220 272 567 194 346 971 194 346 971 354 311 536 207 349 604 207 349 604 (3 436 307) 240 489 915 - -

3 403 395 914 3 645 590 126 ZWL ZWL$ Licences 213 994 334 407 454 367 222 078 789 350 741 978 ( 67 555) 741 978 (70 408) Licencing 3 000 008 5 855 427 1 800 672 ( 167 785) 2 014 666 2 590 022 2 014 666 2 236 744 2 756 644 2 756 644 64 090 369 65 852 621 65 852 621 20 704 868 (1 683 100) Software & 72 624 728 44 557 820 68 262 696 68 262 696 47 557 828 48 012 195 66 304 966 66 304 966 92 804 822 92 804 822 68 541 710 68 541 710 2020 ------ZWL$ 140 817 016 47,557,828 Software and HISTORICAL

------ZWL ZWL$ (63 876 426) 221 349 868 (381 098 947) 23 285 41 269 21 223 59 236 35 951 6 991 235 379 3 645 590 126 35 951 15 328 15 328 370 509 433 989 457 274 493 225 457 274 477 897 493 225 493 225 493 225 Networks Included in the investment Included Computer 1 095 292 1 095 292 Networks During the period, the Bank (600) (600) Computer 10 413 200 000 1 054 023 12 204 905 ------11,109,612 12 204 905 10 739 104 12 204 905 12 204 905 11 109 613 11 109 613 11 150 882 and fittings; condition - location; and Structural - size of Accomodation offered land.; acquired investment properties investment properties acquired valued at ZWL$221.3 million the settlement of various through loan exposures. non-performing with a carrying is property property amount of ZWL$38 ceded million as security to the Bank’s Debentures The Trust. Shares and Preference to the land Bank seeks to add value through property capacity to settle creating thereby development, when the debt instruments creditors 31 December in 2018. At matured 2020, the board made a decision to dispose of investment property valued at ZWL379 492 917. disclosed are These properties held for sale in the as property statement of financial position.

- - 11.4 • • 11.3 - - ZWL - - ZWL$ ZWL$ - - - - 2019 3 450 - - - - Fittings 68 882 59 913 80 495 134 571 428 167 351 122 441 617 522 112 869 784 522 112 582 025 873 234 351 122 291 209 873 234 873 234 1 243 454 9 420 483 9 285 911 21 522 897 Furniture & Furniture Furniture & Furniture and fittings 21 591 779 10 927 843 21 591 779 21 591 779 21 591 779 12 171 297 12 305 868 ------12 171 297 12 171 297 102 289 518 (15 414 777) 5 950 948 491 - -

10 315 767 734 16 353 590 966 ZWL ZWL$

45 349 ( 7 503) & Office 484 737 744 963 394 309 950 683 303 693 HISTORICAL ( 15 689) ( 12 337) ( 11 737) ( 14 668) 950 683 4 445 040 1 217 213 2 850 963 3 100 982 ( 220 140) ( 236 527) 3 397 172 4 318 195 3 397 172 3 779 744 4 347 855 3 404 406 3 404 406 4 347 855 7 184 150 Equipment (14 668) 26 143 373 - - - - 2020 76 734 131 80 959 031 81 691 657 29 614 865 29 614 865 ZWL$ 106 854 194 111 306 522 107 102 404 107 102 404 4 218 786 INFLATION ADJUSTED INFLATION 80 959 031 and equipment - - - - Computer office INFLATION ADJUSTED INFLATION

389 433 920 - - (100 695 410) (381 098 947) - - - - ZWL ZWL$ - - - - 16 353 590 966 Motor (5 848 030 529) - - Motor 10 413 200 000 93 350 Vehicles 54 398 Vehicles Vehicles 195 371 258 960 147 748 992 217 102 076 ( 32 125) ( 22 989) 147 748 1 515 889 4 718 199 4 718 199 ------( 120 194) (294 100) 1 071 304 1 251 177 1 071 304 1 164 654 1 219 052 1 219 052 1 219 052 4 522 828 30 960 508 25 948 209 30 666 408 24 552 514 30 666 408 30 666 408 25 948 209 26 143 580 26 143 580

------ZWL ZWL$ ------so determined as per the above so determined information, was in the to the properties reference assessed by transaction; and meter of The value per square for space and land resources lettable subject properties and comparables analysed. were Surveyson and data collection similar past transactions; Analysis of the collected data; and Comparison of the analysis with the carrying then and properties subject out the valuation of properties. the subject and - state of repair Age of property maintenance; fixtures of quality - quality Aesthetic With regards of to valuation regards With residential comparison method was used. properties, This method entails carrying out a comparing the valuation by directly the subject property, which has been out. The procedure sold or rented as follows: was performed Adjustments were made to the following aspects: 637 103 637 103 637 103 5 514 385 2 233 230 6 131 978 1 092 176 5 494 875 - - 5 514 385 1 729 279 7 747 615 6 131 978 5 494 875 6 131 978 4 402 698 6 131 978 Equipment 99 388 352 Equipment • • • • • • • 5 514 385 97 155 122 Construction 104 902 737 Construction ------104 902 737 104 902 737 104 902 737

ZWL ZWL$ - - ( 735) 89 869 72 646 - - 325 871 Buildings ( 14 682) Buildings Leasehold Leasehold 4 807 382 2 181 958 2 794 133 1 671 235 4 097 251 1 035 919 ( 884 954) ( 101 646) Leasehold 5 133 170 1 361 055 1 361 055 3 032 290 140 281 29 549 636 24 649 147 28 409 485 93 063 070 (4 913 021) 25 633 937 30 426 637 30 426 637 33 220 770 33 220 770 29 770 540 28 409 485 29 770 540 - - - - 127 020 837 30 426 637 127 440 840 153 094 737 157 867 477 157 867 477 119 873 966 122 906 256 119 873 967 119 873 967 For the year ended 31 December 2020 December ended 31 the year For STATEMENTS FINANCIAL AUDITED Mr. D. Marandure (Chairperson) | Dr. M. Maulana (Vice Chairperson) | Mrs. F. I. Muyambo | Mr. B. N. Ndebele (Managing Director) | Mrs. S. Mandimika | Mr. C. Daitai | Mr. E. Chawoneka* | Mr. G. Chiome* (*Executive) E. Chawoneka* | Mr. C. Daitai | Mr. S. Mandimika | Mr. B. N. Ndebele (Managing Director) | Mrs. I. Muyambo | Mr. Chairperson) | Mrs. F. M. Maulana (Vice D. Marandure (Chairperson) | Dr. Mr.

Disposals held for sale to property Transferred value adjustment Fair INVESTMENT PROPERTY Additions Opening balance

Comparable market evidence based Comparable market transactions of similar on purchase stands; buildings and residential Professional cognisance of to take exercised judgement in the the fact that properties was not exactly transactions were comparable in of terms size, quality and location to the properties owned by the Bank; of the market The reasonableness properties of commercial values In determining the market values the market In determining of the independent valuer professional subject properties, the following: considered the buildings and undeveloped stands. is stated at fair Investment property value, which has been determined based performed on valuations independent by an accredited as at 31 valuer and professional December 2020. valuation The with out in accordance was carried Institute of Chatered the Royal Surveyors Appraisal and Valuation Institute Estate and the Real Manual of Zimbabwe Standards. DEPRECIATION AND IMPAIRMENT LOSSES LOSSES AND IMPAIRMENT DEPRECIATION Balance at 31 December 2020 Balance at 1 January 2019 for the year Depreciation Loss on revaluation on revaluation Loss Additions Disposals Balance at 1 January 2019 Additions Balance at 31 December 2019 COST Disposals PROPERTY AND EQUIPMENT PROPERTY COST Balance at 1 January 2019 Gain on revaluation Gain on revaluation Disposals Balance at 1 January 2020 for the year Depreciation Balance at 31 December 2019 Balance at 31 December 2019 Balance at 1 January 2020 Disposals Additions Disposals Balance at 1 January 2020 Disposals Balance at 31 December 2020 Depreciation for the year Depreciation Disposals Balance at 31 December 2020 CARRYING AMOUNT CARRYING 1 JanuaryAt 2019 Gain on revaluation Balance at 31 December 2019 At 31 December 2019 At 1 JanuaryAt 2020 Balance at 1 January 2020 At 31 December 2019 At At 31 December 2020 Additions Gain on revaluation Disposals Balance at 31 December 2020 At 31 December 2020 PROPERTY AND EQUIPMENT PROPERTY DEPRECIATION AND IMPAIRMENT LOSSES AND IMPAIRMENT DEPRECIATION Balance at 1 January 2019 Depreciation for the year Depreciation

• • •

Investment property comprises of 11.2 Investment property

For the year ended 31 December 2020 the year ended 31 December For Notes to the Financial Statements Notes to the Financial

11 DIRECTORS: DIRECTORS: 10 MTB- FNS 0123312 ® ROGUEXD AUDITED FINANCIAL STATEMENTS For the year ended 31 December 2020

Notes to the Financial Statements Notes to the Financial Statements For the year ended 31 December 2020 For the year ended 31 December 2020

19 CONTINGENT LIABILITIES, COMMITMENTS AND LEASING ARRANGEMENTS 20.1.10 CREDIT RISK ANALYSIS INFLATION ADJUSTED

Inflation-adjusted Historical cost 20.1.10.1 Maximum Exposure to Credit Risk by Grade 2020 2019 2020 2019 ZWL$ ZWL$ ZWL$ ZWL$ 2020 2020 2020 2019 2019 2019 Contingent Liabilities ZWL$ ZWL$ ZWL$ ZWL$ ZWL$ ZWL$ Guarantees and performance bonds 51 154 607 149 471 468 51 154 607 33 320 615 Gross maximum Value of Net maximum Gross maximum Value of Net maximum 51 154 607 149 471 468 51 154 607 33 320 615 exposure security exposure exposure security exposure Stage1 167 890 818 19 431 664 148 459 154 467 166 371 1 470 997 465 695 374 Stage 2 49 440 001 18 951 000 30 489 001 394 692 874 119 916 600 274 776 274 To meet the financial needs of customers, the and standby letters of credit carry a similar 19.1 IMPACT OF COVID-19 Stage 3 5 082 695 2 766 000 4 362 695 19 360 948 17 912 800 1 448 149 credit risk to loans. The outbreak of the Novel Coronavirus (COVID Bank enters into various irrevocable com- mitments and contingent liabilities. These 19) pandemic has significantly affected the op- 222 413 514 41 148 664 181 264 850 881 220 193 139 300 397 741 919 796 consist of financial guarantees and letters Legal Claims erating environment. The board is aware that fu- of credit and other undrawn commitments Litigation is a common occurrence in the ture COVID 19 related developments may have 20.1.10.2 Maximum Exposure to Credit Risk by Sector to lend. Banking industry due to the nature of the an impact on Metbank’s future financial results, business undertaken. The Bank has formal 2020 2020 2020 2019 2019 2019 Even though these obligations may not be controls and policies for managing claims. cash flows and financial condition. The extent, ZWL$ ZWL$ ZWL$ ZWL$ ZWL$ ZWL$ recognized on the statement of financial Once professional advice has been obtained duration and impact of the prevailing conditions Gross maximum Value of Net maximum Gross maximum Value of Net maximum position, they do contain credit risk and are and the amount of loss reasonably estimated, remain uncertain and depend on future devel- exposure security exposure exposure security Exposure therefore part of the overall risk of the bank the Bank makes adjustments to account for opments that cannot be accurately predicted at Agriculture 64 751 744 17 601 553 47 150 191 275 588 302 394 488 275 193 814 (see note 20.1.1 - credit risk). any adverse effects which the claims may this stage. Consequently, no reliable estimate of Construction 496 318 496 318 0 31 797 530 31 797 530 - have on its financial standing. At 31 Decem- the impact of the COVID 19 pandemic on Met- Distribution 59 183 170 16 880 000 42 933 170 447 118 167 17 270 544 429 847 623 Letters of credit and guarantees commit the ber 2020, the Bank did not have unresolved bank’s finances could be made. The board will Individuals 14 738 153 - 14 738 153 37 319 407 520 677 36 798 730 bank to make payments on behalf of the cus- legal claims. Accordingly, no provisions have Manufacturing 3 986 752 3 986 752 0 500 976 500 976 - tomers in the event of a specific act, gener- been made in these financial statements for continue implementing mitigating measures to Services 40 947 513 2 184 041 38 763 472 88 676 955 88 676 955 - ally related to import of goods. Guarantees claims. minimise the adverse impact of the pandemic. Mining 15 108 879 - 15 108 879 139 228 139 228 - Communications 8 910 - 8 910 26 579 - 26 579 20.1.3.2 Foreign Exchange Risk Transport 22 562 075 - 22 562 075 53 050 - 53 050 20 RISK MANAGEMENT New IAS39 Foreign exchange risks arise from future commercial 222 413 514 41 148 664 181 264 850 881 220 193 139 300 397 741 919 796 Metbank Metbank 20.1 Introduction transactions and recognised assets and liabilities. This Rating Rating ECL Type of is the risk from movement in the relative rates of Risk is inherent in the Bank’s activities and SRS Category Scale Stage allowance HISTORICAL COST is managed through an ongoing process of exchange between currencies. The risk is controlled 1 AA A Stage 1 12month 20.1.10.3 Maximum Exposure to Credit Risk by Grade identification, measurement, monitoring, through control of open position as per ALCO ECL controlling, and reporting. The risk management directives, Reserve Bank of Zimbabwe requirements approaches deployed by the Bank are aligned and analysis of the market. The Bank manages this 2020 2020 2020 2019 2019 2019 with the strategic objective of increasing 2a A1 A risk through monitoring long and short positions and Gross maximum Value of Net maximum Gross maximum Value of Net maximum shareholder value. To that effect the Bank 2b A assessing the likely impact of forecasted movements in exchange rates on the Bank’s profitability (refer to exposure security exposure exposure security exposure continues to improve its bank-wide risk 2c A note 21). ZWL ZWL ZWL ZWL ZWL ZWL management framework. Each Unit of the Bank 3a A2 A has assumed ownership of the risks inherent in Stage1 167 890 818 19 431 664 148 459 154 104 142 088 327 919 103 814 169 3b A 20.1.4 Operational Risk its processes and each individual within the Bank Stage 2 49 440 001 18 951 000 30 489 001 87 986 085 26 732 158 61 253 927 3c A Operational risk is the risk of loss due to inadequate Stage 3 5 082 695 2 766 000 2 316 695 4 315 999 3 993 173 322 826 is accountable for the risk exposures relating to or failed internal processes, people, systems, external his or her responsibilities. Due to the nature of 4a B1 B Stage 2 Lifetime ECL and legal events. Operational risk can have financial, 222 413 514 41 148 664 181 264 850 196 444 172 31 053 250 165 390 922 banking business, the Bank is exposed mainly non-financial impact of varying degrees to the Bank. to credit risk, market risk, operational risk and Like any other risk category, operational risk can 4b B 20.1.10.4 Historical Cost Maximum Exposure to Credit Risk by Sector liquidity risk. The Bank has resolved to mitigate also have severe impact on the reputation of the these risks not in silos but in a holistic manner. 4c B bank. The Bank endeavours to manage these risks 5a B2 B through a control framework and by monitoring 2020 2020 2020 2018 2019 2019 2019 Risk Management Structure 5b B and responding to potential risks. Controls include Gross maximum Value of Net maximum Gross maximum Value of Net maximum The Board of Directors is responsible for the 5c B effective segregation of duties, access, authorisation exposure security exposure exposure security exposure overall risk management process of the Bank 6a B3 B and reconciliation procedures, staff education and ZWL ZWL ZWL ZWL ZWL ZWL through the appointed Board Risk, Compliance assessment processes, such as the use of internal and Capital Management Committee which 6b B audit. The measurement of operational risk involves Agriculture 64 751 744 17 601 553 47 150 191 24.6% 61 434 947 87 940 61 347 007 has the responsibility to monitor the overall 6c B the analysis of operational loss data and continuous Construction 496 318 496 318 - 0.2% 7 088 398 7 088 398 - risk process within the Bank. The Board Risk 7a B4 B on-site assessments of performance of operational Distribution 59 813 170 16 880 000 42 933 170 38.3% 99 672 884 3 850 000 95 822 884 Committee has the overall responsibility for the 7b B controls for all business processes. Individuals 14 738 153 - 14 738 153 5.6% 8 319 351 116 071 8 203 280 development of the risk strategy and provides 7c B Stress testing Manufacturing 3 986 752 3 986 752 - 1.5% 111 679 111 679 - oversight to the Bank-wide risk management 8 C C Stage 3 Lifetime The Bank carries out stress testing on a regular basis Services 40 947 513 2 184 041 38 763 472 15.5% 19 768 125 19 768 125 - process. ECL in order to investigate potential vulnerabilities of Mining 15 108 879 - 15 108 879 5.7% 31 037 31 037 - The Risk Management Department is responsible the institution to exceptionally severe but plausible Communications 8 910 - 8 910 0.0% 5 925 - 5 925 9 D D events pertaining to credit risk, interest rate risk, for driving the implementation process and Transport 22 562 075 - 22 562 075 8.6% 11 826 - 11 826 reporting on all matters pertaining to the risk 10 E E foreign exchange risk and liquidity risk. The stress 222 413 514 41 148 664 181 264 850 100.0% 196 444 172 31 053 250 165 390 922 profile of the Bank. The department works testing carried out enables the bank to assess its closely with Units of the Bank to ensure that the resilience to severe shocks from within or from Expected Credit Losses (ECL) the market. Severe shocks are events with a low risk strategy is implemented and desired goals In the context of IFRS9 ECL is the probability- likelihood of occurrence but with high impact on are realized. Each department within the Bank weighted estimate of credit losses (i.e., the present the financial condition of the Bank. The bank shall is responsible for the control of its risks in line value of all cash shortfalls) over the expected continue to use stress testing as an early warning life of the financial instrument. A cash shortfall with the Bank’s risk guidelines, policies and system and to compliment other risk management 20.1.11 Credit quality by sector and grading INFLATION ADJUSTED procedures. This includes monitoring the risk of is the difference between the cash flows that are due to an entity in accordance with the contract initiatives. Stress testing helps to determine the exposures against limits and the assessment of preparedness of the bank to absorb losses resulting Inflation adjusted total position as at 31 December 2020 risks of new products and structured transactions. (scheduled or contractual cashflows) and the cash flows that the entity expects to receive (actual from shock events. The stress testing methodology 2020 2020 2020 2020 expected cashflows) applied enables comparison of pre-shock capital The Finance Department and Treasury Stage 1 Stage 2 Stage 3 levels and prudential ratios with corresponding post- Department are responsible for managing 12 month Lifetime Lifetime Expected Credit Losses are the product of shock values leading to the conclusion that the bank the Bank’s assets and liabilities and the Probability of Default (PD)*Exposure at Default is resilient or not. ECL ECL ECL Total overall financial structure. They are primarily (EAD)*Loss Given Default (LGD) ZWL ZWL ZWL ZWL responsible for the funding and liquidity risks Internal Audit of the Bank. The Bank’s policy is that risk Probability of Default (PD) The Bank’s Internal Audit (IA) function provides management processes throughout the Bank are It is the chance that borrowers will fail to meet independent and objective assurance of the overall Agriculture 60 840 256 3 705 490 205 998 64 751 744 audited annually by the Internal Audit function, their contractual obligations in the future. The effectiveness of internal controls across the Bank, and Construction 40 205 1 961 454 152 496 318 which examines both the adequacy of the PD is derived using historical internal credit rating has adopted a risk-based internal audit approach, Distribution 14 685 781 42 670 895 2 456 494 59 813 169 procedures and the Bank’s compliance with the data. which governs its operations. During the year under Individuals 12 924 476 5 306 1 808 371 14 738 153 procedures. Internal Audit discusses the results of review, the Internal Audit focused their attention on Manufacturing 3 956 698 - 30 054 3 986 752 all assessments with management, and reports Exposure at Default (EAD) the following areas, including, credit operations, its findings and recommendations to the Finance It is the total value that a bank is exposed to a t retail banking and branch operations, international Services 37 812 103 3 051 239 84 171 40 947 513 and Audit Committee. the of a loan’s default. In most cases and for most banking & exchange control operations, as well as Mining 15 067 509 - 41 370 15 108 879 loan products, EAD is taken as t h e reconciliations. Communications 3 593 5 111 207 8 910 The Bank’s Asset and Liabilities Management gross outstanding balance at time of default. It The Chief Internal Auditor reports to the Board Audit also includes off-balance sheet exposures such as Transport 22 560 197 - 1 878 22 562 075 Committee adopts a proactive risk management & Finance Committee and has a staff compliment guarantees and lending commitments which are 167 890 818 49 440 001 5 082 695 222 413 514 approach to ensure that all risk profiles fall of three resources with vast banking and ICT- then modelled based on historical related experience. The IA staff complement was within an acceptable balance between risk and experience to determine the appropriate exposure considered adequate given the Bank’s size, nature return. The Bank has over the years developed Total position as at 31 December 2019 estimates. and complexity. a comprehensive risk management framework 2019 2019 2019 2019 together with policies, procedures and guidelines Loss Given Default (LGD) 20.1.5 Reputational Risk Stage 1 Stage 2 Stage 3 as a management tool to accomplish stated It is an estimate of the loss from a transaction Reputational risk is the risk that the Bank could lose 12 month Lifetime Lifetime objectives and strategies. given that a default has occurred. The LGD its market share due to perception by the market ECL ECL ECL Total estimate is calculated as the quotient of the set that the Bank is not conducting business in a sound 20.1.1 Credit Risk of estimated cashflows resulting from the workout manner. ZWL ZWL ZWL ZWL Credit risk is the risk that the Bank will incur a and/or collections process (the loss of principal, The Bank has in place customer complaints the carrying costs of non-performing loans e.g. loss because its customers or counterparties monitoring procedures for ensuring continuous Agriculture 131 645 768 143 050 818 891 716 275 588 302 fail to discharge their contractual obligations. Interest income foregone and workout expenses. improvements in the bank’s service standards. Construction 13 847 980 17 909 110 40 440 31 797 530 The Bank manages and controls credit risk by The estimates take into account the time value of money by discounting the recoveries to the date of setting limits on the amount of risk it is willing 20.1.6 Legal Risk Distribution 261 149 948 179 595 720 6 372 499 447 118 167 default. to accept for individual counterparties and for Legal risk is the risk that a transaction or contract Individuals 34 661 753 1 064 538 1 593 116 37 319 407 geographical and industry concentrations, and cannot be consummated because of some legal 20.1.2 Liquidity Risk Manufacturing 484 899 10 627 5 450 500 976 barrier, such as inadequate documentation, a by monitoring exposures in relation to such Liquidity risk is defined as the risk that the Bank Services 25 223 634 53 038 200 10 415 121 88 676 955 limits. may fail to fund increases in assets or meet regulatory prohibition on a specific counter-party and the non-enforceability of contracts such as Mining 114 901 13 000 11 327 139 228 obligations as they fall due without incurring Communications 12 493 8 922 5 163 26 578 The Bank also ensures that applicants for credit unacceptable losses. This may be caused by the netting and collateral arrangements in bankruptcy. facilities are assessed using an internal credit Bank’s inability to liquidate assets or to obtain The Bank’s legal department safe keeps, maintains Transport 24 995 1 938 26 117 53 050 rating system before the facility is granted and funding to meet its liquidity needs. Liquidity and approves all existing and new legal documents 467 166 371 394 692 874 19 360 948 881 220 193 their performance is continuously monitored risk could be a result of a market disruption or of the bank. so as to maintain a quality loan book. The liquidity squeeze whereby the Bank may only be credit mitigation techniques include collateral, able to unwind specific exposures at significantly 20.1.7 Compliance Risk netting arrangements, guaranties and insurance. discounted values. To limit this risk, management, Compliance risk is the risk of financial loss or 20.1.11 Credit quality by sector and grading (continued) HISTORICAL COST The internal rating process and the credit risk through the Assets and Liabilities Committee otherwise arising from violations of regulatory laws Total position as at 31 December 2020 and rules which may result in adverse judgements mitigation techniques have been incorporated in (ALCO) has arranged diversified funding sources in lawsuits or regulatory sanctions such as penalties, 2020 2020 2020 2020 the Bank’s credit risk policy and procedures. for the Bank in addition to its core deposit base, and adopted a policy of managing assets with negatively affecting the Bank’s ability to achieve its Stage 1 Stage 2 Stage 3 liquidity in mind and of monitoring future cash operational objectives. The credit quality of financial assets is managed 12 month Lifetime Lifetime flows and liquidity on a daily basis. The Bank The Bank has in place an independent compliance ECL ECL ECL Total by the Bank using internal credit ratings. The has developed internal control processes and function that regularly monitors and reports on the table shown in note 20.1.10 shows the credit contingency plans for managing liquidity risk. compliance risk exposure of the Bank. ZWL ZWL ZWL ZWL quality by class of asset for all financial assets This incorporates an assessment of expected cash exposed to credit risk, based on the bank’s flows and the availability of high grade collateral 20.1.8 Strategic Risk Agriculture 60 840 256 3 705 490 205 998 64 751 744 internal credit rating system. The amounts which could be used to secure additional funding Strategic risk is the risk of an unattractive or adverse Construction 40 205 1 961 454 152 496 318 presented are gross of impairment allowances. if required. impact on capital and earnings due to business policy decisions (made or not made), changes in Distribution 14 685 781 42 670 895 2 456 494 59 813 170 Credit terms: The Bank stresses the importance of current the economic environment, deficient or insufficient Individuals 12 924 476 5 306 1 808 371 14 738 153 Default accounts and savings accounts as sources of implementation of decisions, or a failure to adapt to Manufacturing 3 956 698 - 30 054 3 986 752 This is failure by a borrower to comply with the funds to finance lending to customers. They are changes in the environment. Services 37 812 103 3 051 239 84 171 40 947 513 terms and conditions of a loan facility as set monitored using the loans to deposit ratio, which Mining 15 067 509 - 41 370 15 108 879 out in the facility offer letter or loan contract. compares loans and advances to customers as The Board is ultimately responsible for the Default occurs when a debtor is either unwilling a percentage of customer current and savings development, approval and application of the Communications 3 593 5 111 207 8 910 or unable to repay a loan. accounts, together with term funding with a Bank’s strategic risk policies. The Board approves the Transport 22 560 197 - 1 879 22 562 075 remaining term to maturity in excess of one year Bank’s strategy, whilst management is responsible 167 890 818 49 440 001 5 082 695 222 413 514 (refer to note 20.1.13). for implementation and ensuring that regular Past due loans These are loans whereby the debtor is in default reviews are done in line with changes in operating 20.1.3 Market Risk conditions. Historical cost total position as at 31 December 2019 by exceeding the loan tenure or expiry date as Market risk is the risk that adverse changes in the expressly set out in the loan contract i.e. the 2019 2019 2019 2019 market value of a portfolio of financial instruments 20.1.9 Capital adequacy debtor fails to repay the loan by a specific given may result in losses to the bank. Market risk Stage 1 Stage 2 Stage 3 The capital adequacy ratio measures a bank's capital date. arising from interest rate and foreign currency 12 month Lifetime Lifetime in relation to its risk-weighted assets.As per Banking exposures relating to dealing positions are housed Regulations 2000, capital supporting banking and ECL ECL ECL Total Impaired loans and managed in the Treasury division within a trading activities is split into two classes namely ZWL ZWL ZWL ZWL The Group’s policy regarding impaired/ doubtful framework of pre-approved portfolio limits. core capital (tier 1) and supplementary capital (tier loans is all loans where the degree of default The Bank’s Risk Management department is responsible for daily monitoring of limits and 2) (refer to note 23). The capital adequacy ratio is Agriculture 29 346 858 31 889 305 198 784 61 434 947 becomes extensive such that the Group no longer calculated by adding tier I capital to tier II capital has reasonable assurance of collection of the full pricing, thereby ensuring that any errors or Construction 3 087 032 3 992 351 9 015 7 088 398 unauthorised transactions are promptly identified. and dividing by risk-weighted assets. Tier I capital outstanding amount of principal and interest. All is the core capital of a bank, which includes equity Distribution 58 216 307 40 036 001 1 420 576 99 672 884 such loans are classified in the 8, 9 and 10 under capital and disclosed reserves. This type of capital Individuals 7 726 899 237 310 355 142 8 319 351 the Basel II ten tier grading system. 20.1.3.1 Interest Rate Risk The Bank is exposed to the risks associated with absorbs losses without requiring the bank to cease its Manufacturing 108 095 2 369 1 215 111 679 operations; tier II capital is used to absorb losses in the effects of fluctuations in levels of interest rates Services 5 622 926 11 823 430 2 321 769 19 768 125 Provisioning policy and write offs on its financial position and cashflows. Managing the event of a liquidation. The Bank has adopted IFRS9 to determine interest rate risk in the bank is done through Mining 25 614 2 898 2 525 31 037 expected credit losses (ECL). three analytical techniques namely gap analysis, The minimum total risk-based capital ratio for a Communications 2 785 1 989 1 151 5 925 simulation and duration. These analytical tools banking institution as per the regulations is 12%. Transport 5 572 432 5 822 11 826 The table below shows the mapping of the RBZ contribute towards identifying the risk exposure as The risk weightings depend on the credit, market and Supervisory Rating Scale to the IFRS9 staging well as the sensitivity to interest rate risk (refer to associated risks. The higher the exposures the more 104 142 088 87 986 085 4 315 999 196 444 172 matrix: note 20.1.12). the capital needed.

DIRECTORS: Mr. D. Marandure (Chairperson) | Dr. M. Maulana (Vice Chairperson) | Mrs. F. I. Muyambo | Mr. B. N. Ndebele (Managing Director) | Mrs. S. Mandimika | Mr. C. Daitai | Mr. E. Chawoneka* | Mr. G. Chiome* (*Executive) stronger together! 4 ROGUEXD® MTB-FNS 0123312 ZWL Total 2019 ZWL$ ZWL$ ZWL$ ZWL$ ZWL$ TOTAL TOTAL TOTAL TOTAL 74 818 230 182 305 000 9 673 048 2 562 190 9 499 782 5 230 270 5 230 270 6 944 325 5 230 270 5 230 270 3 697 677 1 548 049 2 469 426 - - 89 166 674 72 380 440 72 380 440 16 587 244 89 166 674 72 380 440 72 380 440 67 228 817 47 293 038 35 389 864 47 589 347 12 185 959 72 474 543 47 293 038 25 181 505 194 346 971 538 887 859 205 446 053 381 098 947 199 986 170 184 088 083 121 523 024 239 558 064 301 578 766 212 149 738 239 558 063 745 307 679 554 959 959 586 188 433 273 708 275 696 801 956 239 124 144 166 777 384 166 777 384 239 558 064 325 110 335 212 149 738 112 960 596 166 777 384 166 777 384 239 558 063 (72 780 680) (72 780 678) 3 645 590 126 2 821 859 892 4 043 680 226 4 043 680 226 10 413 200 000 10 056 275 741 11 945 201 238 11 945 201 238 HISTORICAL 2020 ZWL$ 352 310 AED AED AED AED 1 027 934 ZWL Over 1 380 244 ZWL$ ZWL$ ZWL$ ZWL$ 1 year 112 954 112 954 112 954 112 954 112 954 112 954 ------2 562 190 2 469 426 ------35 821 522 90 962 333 35 821 522 35 821 522 35 389 864 47 589 347 12 185 959 160 690 177 82 263 052 85 115 518 2019 194 346 971 381 098 947 199 986 170 126 518 131 ZWL$ 160 690 177 160 690 177 554 959 959 586 188 433 696 801 956 239 124 144 ------3 645 590 126 2 821 859 892 3 855 087 468 3 769 971 950 10 413 200 000 10 056 275 741 11 282 156 611 11 199 893 559 1 078 336 3 317 564 4 395 900 AUD AUD AUD AUD - - 704 704 704 ZWL$ ZWL$ ZWL$ ZWL$ 3 781 3 157 3 781 3 781 3 781 3 157 3 157 3 781 3 781 ------ZWL The Bank’s Regulatory capital consists of: Tier 1 ordinarycapital, which includes share capital and premium, retained profits, non- reservesdistributable and other regulatory included are that items to relating adjustments for capital differently treated are in equity but adequacy purposes; Tier 2 qualifying capital, which includes subordinated liabilities, revaluation reserve, allowances and the ele- impairment collective - to unre reservement of the fair value relating alized classifiedgains as on equity instruments and available-for-sale; risk and operational 3 capital or market Tier risk capital and opera- capital include market tional risk capital. Operational risk includes le- to the is allocated risk capital risk. Market gal risk of losses in the on and off statement of financial position arising from movements in prices. market 1 year 406 204 104 512 GBP GBP GBP GBP 104 512 • • • - - 2 972 808 2020 ZWL$ ZWL$ ------ZWL$ ------ZWL$ ------ZWL$ ------25 894 204 22 500 000 12 391 059 ------6 130 - - 5 425 6 130 1 209 6 130 6 130 5 425 5 425 6 130 6 130 1 209 1 209 26 300 408 37 863 867 26 300 408 37 759 355 - - stronger together! 6 months to ------(82 263 052) (85 115 518) 654 087 INFLATION ADJUSTED INFLATION 1 908 427 HISTORICAL COST 2 562 514 BWP BWP BWP BWP ZWL$ ZWL$ ZWL$ ZWL$ - - HISTORICAL 47 120 47 120 47 120 ZWL ------228 182 - - 211 372 - - 228 182 - - - - 228 182 228 182 211 372 211 372 228 182 228 182 INFLATION ADJUSTED INFLATION - - 6 months 4 574 131 1 187 639 6 526 974 2 199 243 1 187 639 2 199 243 57 411 288 27 532 769 1 month to 61 985 419 34 059 743 60 797 780 31 860 500 ------EUR EUR EUR EUR ZWL$ ZWL$ ZWL$ ZWL$ (108 563 460) (122 874 873) 87 516 19 509 25 712 25 712 104 548 137 786 137 786 115 340 - - 104 548 137 785 ------(33 238) 104 548 115 340 104 548 137 785 ( 33 237) 137 786 8 210 269 1 830 257 8 297 785 8 182 445 1 849 766 1 824 054 ZWL Up to ZAR ZAR ZAR ZAR 1 month ZWL$ ZWL$ ZWL$ ZWL$ 5 098 917 7 537 183 31 178 228 43 689 ------538 481 655 744 120 040 109 131 965 271 404 520 112 148 195 982 525 543 112 148 117 156 544 880 ------574 758 800 744 120 040 116 669 148 271 404 520 721 525 160 845 544 880 - - 1 368 987 1 368 987 2 110 336 2 444 253 1 368 987 1 368 987 2 110 336 (629 201) 1 481 135 2 110 336 2 444 253 1 481 135 1 481 135 2 110 336 (169 361 240) (169 361 240) (154 735 372) (154 735 372) ( 629 200) ( 384 035) (1 722 728) 722 (1 USD USD USD USD ZWL$ ZWL$ ZWL$ ZWL$ Reserve Bank of Zimbabwe (RBZ) requirements. Reserve requirements. Bank of Zimbabwe (RBZ) - require capital In implementing the current ments, the RBZ requires the Bank to maintain ratio of total capital to total risk a prescribed weighted assets. The Bank’s objectives, when managing capital are: set by comply with the capital requirements To the Reserve Bank of Zimbabwe; the Bank’s ability to continue as a safeguard To so that it can continue to provide going concern returns for shareholders and benefits for other and stakeholders; base to support the capital maintain a strong To adequacy businesses. Capital development of its monitored and the use of regulatory capital are on a regular basis by the Bank’s management, employing techniques based on the guidelines developed by the Basel Committee as imple- mented by the Reserve Bank of Zimbabwe (the “RBZ”), for supervisory purposes for the Bank. The required information is filed with the RBZ on a quarterly basis 4 775 480 6 440 872 4 775 480 • • • 3 697 677 1 435 818 89 166 674 70 898 500 16 587 244 89 166 674 70 898 500 29 459 882 46 722 446 34 593 377 46 722 446 237 309 942 132 152 777 209 590 145 237 309 942 164 840 654 237 309 942 155 180 893 209 590 145 164 840 654 237 309 942 (72 469 287) (54 409 252) (72 469 288) (12 129 069)

- - -

Property and equipment Property Investment property ASSETS Bank and cash balances Loans and advances to customers and advances Loans or loss profit through assets held Financial Property held for sale Property Right of use asset LIQUIDITY RISK (Continued) position as at 31 December 2020 Total Other assets EQUITY AND LIABILITIES equity Shareholders' Deposits from customers Deposits from taxation Deferred Other liabilities Financial assets held through profit or loss profit assets held through Financial and equipment Property Lease liability Lease Investment property Other assets Loans and advances to customers Loans Net liquidity gap Cumulative gap as at 31 December 2020 position at 31 December 2019 Total ASSETS Bank and cash balances EQUITY AND LIABILITIES equity Shareholders' customers Deposits from Debentures taxation Deferred Other liabilities Net liquidity gap Cumulative gap as at 31 December 2019 POST EMPLOYMENT BENEFITS BENEFITS POST EMPLOYMENT as follows:- in the income statement are The amounts recognised contributions Fund Metbank Pension National Social Security Authority contributions National Social Security Authority Total position as at 31 December 2020 Total Base currency Assets Overdrafts FOREIGN EXCHANGE GAP ANALYSIS FOREIGN EXCHANGE ZWL$ equivalent Cash Nostro balances Nostro Total assets Total Liabilities customers Deposits from liabilities Total Total position as at 31 December 2019 Total Base currency US$ equivalent Assets Overdrafts Nostro balances Nostro Net Currency Position Net Currency Position Cash Total assets Total Liabilities customers Deposits from liabilities Total Net Currency Position Net Currency Position FOREIGN EXCHANGE GAP ANALYSIS FOREIGN EXCHANGE position as at 31 December 2020 Total Base currency ZWL$ equivalent Assets Overdrafts Cash and bank balances Nostro balances Nostro Loans and Overdrafts Loans Total assets Total Liabilities customers Deposits from liabilities Total Total position as at 31 December 2019 Total Base currency Net Currency Position Net Currency Position US$ equivalent Assets Overdrafts Cash Nostro balances Nostro Total assets Total Liabilities customers Deposits from Total liabilities Total Net Currency Position Net Currency Position Post Post employment benefits are provided for se- employees by a separate pen- permanent lected sion fund to which the Bank The contributes. which under plan contribution defined a is fund reference by determined are benefits retirement to the employee’s contributions and the perfor mance of the fund. Fund This is a separately funded defined benefit plan Secu established under the National Social rity Act of 1987.The Bank contributes 4.5% of pensionable employees emoluments of eligible upto a maximum of ZWL$5,000 per employee. Capital Ad- The Bank has adopted the Internal the which articulates equacy Assessment Policy Bank’s approach, assessment and management perspective. an internal of risk and capital from management capital Bank’s the of objective The that it complies with the is to ensure process Notes to the Financial Statements Notes to the Financial 2020 the year ended 31 December For 20.1.13 20.1.13.3 21 22 22.1 22.2 Metbank Pension Fund 22.2 Metbank Pension Pension Social Security Authority 22.3 National MANAGEMENT 23 CAPITAL 5

ZWL ZWL ZWL Total Total Total 9 673 048 2 562 190 9 673 048 2 562 190 9 499 782 9 673 048 2 562 190 2 469 426 2 469 426 2 469 426 35 389 864 47 589 347 12 185 959 42 614 650 54 664 451 42 614 650 54 664 453 538 887 859 205 446 053 354 311 536 381 098 947 212 006 253 538 887 859 205 446 053 354 311 536 381 098 947 212 006 253 121 523 024 538 887 859 184 088 083 381 098 947 194 346 971 205 446 053 199 986 170 273 708 275 696 801 956 239 124 144 745 307 679 598 708 475 545 134 740 825 792 559 586 188 433 288 911 406 301 666 004 745 307 679 586 188 433 554 959 959 598 708 475 745 307 679 586 188 433 545 134 740 825 792 559 288 911 406 301 666 003 1 227 815 806 3 125 752 973 1 072 676 381 3 645 590 126 2 821 859 892 1 227 815 804 3 125 752 973 1 072 676 381 10413 200 000 12 117 185 886 10 184 511 874 16 353 590 966 12 876 800 714 4 043 680 226 4 043 680 226 10 413 200 000 10 184 511 873 10 056 275 741 10 413 200 000 16 353 590 966 18 357 710 325 12 876 800 714 12 117 185 886 18 357 710 325 18 357 710 325 12 117 185 886 11 945 201 238 11 945 201 238 12 117 185 886 18 357 710 325

ZWL ZWL Over ZWL 1 year bearing bearing 2 562 190 2 562 190 2 469 426 2 562 190 90 962 333 35 389 864 47 589 347 54 664 451 82 263 052 288 911 406 301 666 004 381 098 947 194 346 971 199 986 170 696 801 956 354 311 536 288 911 406 301 666 004 Non-interest Non-interest 354 311 536 381 098 947 212 006 253 598 708 475 567 542 067 586 188 433 ------381 815 924 554 959 959 381 098 947 212 006 253 - - - - 598 708 475 ------579 958 578 209 907 490 ------579 958 578 - - - - 3 125 752 973 1 072 676 381 941 614 689 - - - - 3 125 752 973 3 645 590 126 2 821 859 892 3 518 661 848 10 413 200 000 11 454 141 259 10 184 511 873 16 353 590 966 12 876 800 714 3 728 569 337 10 056 275 741 10 413 200 000 10 413 200 000 10 184 511 873 16 353 590 966 16 944 168 376 12 876 800 714 11 371 878 207 17 511 710 443 17 129 894 519 10 611 235 700 11 191 194 278 11 363 178 926 10 783 220 348 16 002 553 687

ZWL ZWL Over Over ZWL 1 year 1 year 1 year 406 204 468 828 2 469 426 468 828 2 469 426 90 962 333 12 185 959 90 962 333 54 664 453 25 894 204 26 300 408 55 584 503 13 335 588 90 962 333 ------90 962 333 ------586 188 433 126 518 131 239 124 144 26 300 408 567 542 067 - - 6 months to 100 931 751 251 310 103 586 188 433 567 542 067 588 657 859 126 518 131 588 657 859 169 851 843 (82 263 052) 1 072 676 381 169 383 014 (579 958 578) (497 695 526) (209 907 490) (124 791 972) (497 695 526) (579 958 578) (559 798 767) (941 614 689) 1 127 340 834 (381 815 924)

INFLATION ADJUSTED INFLATION ZWL

ZWL HISTORICAL COST 1 year 1 year ZWL 406 204 104 512 406 204 468 825 104 512 INFLATION ADJUSTED INFLATION 2 972 808 468 825 12 391 059 22 500 000 25 894 204 ------25 894 204 55 584 503 13 335 588 ------26 300 408 26 300 408 37 759 355 - - 37 863 867 26 300 408 26 300 408 6 months to - - 6 months to 100 931 751 169 851 842 6 months 4 574 131 9 865 487 (82 263 052) (85 115 518) 1 187 639 1 187 639 (82 263 052) 169 383 017 57 411 288 61 985 419 29 279 062 9 865 487 1 month to 60 797 780 (381 815 922) 123 508 026 ------152 787 088 142 921 601 (108 563 460) (551 198 939)

ZWL ZWL

6 months 1 187 639 6 526 974 4 574 131 2 199 243 2 199 243 27 532 769 57 411 288 ZWL 1 187 639 ------1 month to ------6 months 60 797 780 61 985 419 31 860 500 4 574 131 9 865 487 34 059 743 Up to 1 187 639 1 187 639 57 411 288 29 279 062 - - 9 865 487 ------1 month to 61 985 419 60 797 780 123 508 026 152 787 088 (108 563 460) (122 874 873) 1 month 142 921 601 5 098 917 (108 563 460) (551 198 939) 31 178 228 33 810 715 538 481 655 574 758 800 489 550 237 744 120 039 ------744 120 039 523 360 952

ZWL 1 217 481 492 (169 361 240) (169 361 240) Up to 1 217 481 492 ( 694 120 540) ( 694 120 540) ZWL Up to 1 month 7 537 183 5 098 917 1 month 31 178 228 ------109 131 965 538 481 655 744 120 040 271 404 520 5 098 917 574 758 800 271 404 520 116 669 148 31 178 228 33 810 715 744 120 040 ------(169 361 240) (169 361 240) (154 735 372) (154 735 372) 538 481 655 489 550 237 523 360 952 744 120 040 574 758 800 744 120 040 1 217 481 492 (169 361 240) (169 361 240) 1 217 481 492 ( 694 120 540) ( 694 120 540) For the year ended 31 December 2020 December ended 31 the year For STATEMENTS FINANCIAL AUDITED Mr. D. Marandure (Chairperson) | Dr. M. Maulana (Vice Chairperson) | Mrs. F. I. Muyambo | Mr. B. N. Ndebele (Managing Director) | Mrs. S. Mandimika | Mr. C. Daitai | Mr. E. Chawoneka* | Mr. G. Chiome* (*Executive) E. Chawoneka* | Mr. C. Daitai | Mr. S. Mandimika | Mr. B. N. Ndebele (Managing Director) | Mrs. I. Muyambo | Mr. Chairperson) | Mrs. F. M. Maulana (Vice D. Marandure (Chairperson) | Dr. Mr. LIQUIDITY RISK ASSETS Bank and cash balances and advances to customers Loans or loss profit assets held through Financial and equipment Property Total position as at 31 December 2020 Total Investment property Property held for sale Property Right of use asset Other assets EQUITY AND LIABILITIES Shareholders' equity Shareholders' Deposits from customers Deposits from taxation Deferred Total position at 31 December 2019 Total ASSETS Bank and cash balances Other liabilities Cumulative gap as at 31 December 2020 and advances to customers Loans or loss profit assets held through Financial Lease liability Lease Net liquidity gap Property and equipment Property Investment property Other assets EQUITY AND LIABILITIES Shareholders' equity Shareholders' Deposits from customers Deposits from Debentures Deferred taxation Deferred Other liabilities Cumulative gap as at 31 December 2019 Net liquidity gap Total position as at 31 December 2020 Total Cumulative gap as at 31 December 2020 Total position as at 31 December 2019 Total ASSETS Bank and cash balances ASSETS Bank and cash balances Lease liability Lease Interest rate re-pricing gap Other liabilities Loans and advances to customers Loans Loans and advances to customers Loans Deposits from customers Deposits from taxation Deferred or loss profit assets held through Financial EQUITY AND LIABILITIES equity Shareholders' and equipment Property Property held for sale Property Right of use asset Investment property Financial assets held through profit or loss profit assets held through Financial and equipment Property Other assets Cumulative gap as at 31 December 2019 Investment property Other assets EQUITY AND LIABILITIES equity Shareholders' customers Deposits from Interest rate re-pricing gap Debentures Other liabilities Deferred taxation Deferred Loans and advances to customers and advances Loans ASSETS Bank and cash balances or loss profit through assets held Financial INTEREST RATE REPRICING AND GAP ANALYSIS REPRICING AND GAP ANALYSIS INTEREST RATE position as at 31 December 2020 Total Property and equipment Property Investment property Property held for sale Property Right of use asset Other assets EQUITY AND LIABILITIES Shareholders' equity Shareholders' Deposits from customers Deposits from Deferred taxation Deferred Other liabilities Lease liability Lease Interest rate re-pricing gap Cumulative gap as at 31 December 2020 Total position as at 31 December 2019 Total ASSETS Bank and cash balances Loans and advances to customers Loans Financial assets held through profit or loss profit assets held through Financial Property and equipment Property Investment property Other assets EQUITY AND LIABILITIES Shareholders' equity Shareholders' Deposits from customers Deposits from Debentures Deferred taxation Deferred Other liabilities Interest rate re-pricing gap Cumulative gap as at 31 December 2019

For the year ended 31 December 2020 the year ended 31 December For Notes to the Financial Statements Notes to the Financial

DIRECTORS: DIRECTORS:

20.1.13

20.1.12.1 20.1.13.1

20.1.12.1 20.1.13.2

20.1.12 20.1.12.1 20.1.12.1 MTB- FNS 0123312 ® ROGUEXD AUDITED FINANCIAL STATEMENTS For the year ended 31 December 2020

Notes to the Financial Statements Notes to the Financial Statements For the year ended 31 December 2020 For the year ended 31 December 2020

27.2 Audit and Finance Committee (Continued...) The Bank’s regulatory capital position as at 31 December 2020 was as follows: The record of attendance by members of the Committee is as follows: INFLATION ADJUSTED HISTORICAL Meetings held 2020 2019 2020 2019 ZWL$ ZWL$ ZWL$ ZWL$ Member 1 2 3 4 % Attendance 23 CAPITAL ADEQUACY Mrs. S. Mandimika     100 Ordinary share capital 309 313 827 309 313 827 12 500 000 12 500 000 Dr. M. Maulana     100 Non-redeemable preference shares 393 735 147 393 735 147 15 911 637 15 911 637 Mr. G. Chiome     100 Revaluation reserve 23 322 177 1 077 211 88 359 870 18 301 991 Adv. B. Hungwe   N N 100 Retained profit 9 063 956 835 11 772 301 124 9 923 574 377 2 758 966 361 Mr. E. Chawoneka N N  N 100 Core Capital 9 790 327 986 12 476 427 309 10 040 345 884 2 805 679 989 less Capital allocated for market and KEY operational risk (35 576 021) (44 800 711) (35 576 021) (9 987 105)  Present Tier 1 capital 9 754 751 965 12 431 626 598 10 004 769 863 2 795 692 884 LOA Leave of absence granted N No longer or not yet a member General provisions 8 773 198 26 408 613 8 773 198 5 887 085 Capital reserves 394 183 887 394 183 887 15 929 772 15 929 772 Tier 2 capital 402 957 085 420 592 500 24 702 970 21 816 857 27.3 Risk, Compliance and Capital Management Committee The Committee’s terms of reference are to: Tier 3 capital :-Sum of market and opera- 35 576 021 44 800 711 35 576 021 9 987 105 • Define the policy framework and processes for risk management; tional risk capital • Ensure continuous risk monitoring by management; receive assurance regarding the adequacy and effectiveness of the risk policies, procedures, practices and controls applied Total regulatory capital 10 193 285 071 12 897 019 809 10 065 048 854 2 827 496 846 within the Bank in the day-to-day management of its business. • Identify and assess the risks to which the Bank is exposed. Capital adequacy ratio 71.2% 61.6% 71.2% 61.6% • Assess and evaluate appropriateness of risk mitigation strategies to ensure that the Bank optimally manages the risks to which it is exposed. Tier I Ratio 73.5% 66.0% 73.5% 66.0% • Ensures that the Bank undertakes a formal internal risk assessment at least annually. Tier II Ratio 0.2% 0.6% 0.2% 0.6% Tier III Ratio 0.3% 0.3% 0.3% 0.3% The record of attendance by members of the Risk and Compliance Committee is as follows: Meetings held Member 1 2 3 4 % Attendance 24 FAIR VALUES transact acting at arm’s length. Independent professional valuers Adv. B. Hungwe   N N 100 In the application of the Bank’s accounting policies, man- adjust the open market value for part of the property that will Dr. M. Maulana     100 agement is required to make judgements, estimates and have been sold or committed to third parties and/or associates. Mr. B. Ndebele     100 assumptions about the carrying amounts of assets and li- Mr. G. Chiome     100 abilities that are not readily apparent from other sources. 25 GOING CONCERN The estimates and associated assumptions are based on The Bank’s Board of Directors has made an assessment of the Mrs. S. Mandimika N    100 historical experience, the work of independent professional Bank’s ability to continue operating as a going concern amid valuers and other factors that are considered to be relevant. liquidity challenges the Bank is facing. KEY Actual outcomes may differ from these estimates. The esti-  Present mates and underlying assumptions are reviewed on an on- The Bank has put in place a raft of measures to address the going basis. potential impact of the liquidity challenges, key amongst them LOA Leave of absence granted being the restructuring of the Bank’s statement of financial posi- N No longer or not yet a member The following are the key assumptions concerning the fu- tion and refocusing the Bank’s business model towards Prop- ture, and other key sources of estimation uncertainty at erty Development. Key achievements which have significantly the reporting date, that have a significant risk of causing a improved the stability of the Bank includes the establishment 27.4 Loans Review Committee material adjustment to the carrying amounts of assets and of new lines of credit, structured deals mainly focused in the The Committee is responsible for ensuring that: liabilities within the next financial year. agricultural sector to boost the Bank’s non-funded income and various non-funded income initiatives to boost organic growth. • Loans portfolio and lending function conforms to the approved lending policy approved and adopted by the Board. Investment property The Bank has also planned the disposal of investment properties • Portfolio risk is properly assessed, identified and categorized in accordance with the Reserve Bank of Zimbabwe regulations. The values of the investment properties are reviewed annu- considering the significant portfolio of real estate on the Bank’s • Potential losses are adequately and properly provided for in the correct accounting period. ally by independent professional valuers where the results statement of financial position to unlock liquid capital. of the movement of the values are adjusted for in the profit The record of attendance by members of the Loans Review Committee is shown below: or loss as fair value adjustments under investment income Given the initiatives above, the Directors believe that the Bank or impairment. Independent professional valuers base their has adequate resources and capacity to continue in operational Meetings held existence for the foreseeable future. The Bank therefore contin- valuations on the open market values being the price at Member 1 2 3 4 % Attendance which a willing seller and a willing buyer, who are both ues to adopt the going concern basis in preparing its financial well informed about the market conditions, are prepared to statements. Adv. B. Hungwe   N N 100 Mr. G. Chiome     100 Dr. M. Maulana     100 26 RISK AND CREDIT RATINGS INFORMATION Mrs. S. Mandimika N    100 CAMELS Ratings The Reserve Bank of Zimbabwe Conducts regular examinations of Banks and Financial Institutions it regulates. The results of the last KEY inspection conducted by the Reserve Bank as at 31 December 2020 are as follows:-  Present LOA Leave of absence granted December 2020 CAMELS* Ratings N No longer or not yet a member Sensitivity to Capital Asset Quality Management Earnings Liquidity Overall Rating Market Risk Metbank Limited is reviewing the composition of the Board Loans Review, Audit & Finance, and the Risk, Compliance & Capital Management Committees, to incorporate a 2 – Satisfactory 3 – Fair 3 – Fair 3 – Fair 3 – Fair 2 – Satisfactory 3 – Fair balanced mix of executive and non-executive directors in order to comply with prescribed guidelines and good governance.

CAMELS is an acronym for capital adequacy, asset quality management, earnings, liquidity and sensitivity to market risk. CAMELS 27.5 Human Resources and Remuneration Committee Rating System uses a rating scale of 1 to 5 where ‘1’; strong; ‘2’ is satisfactory; ‘3’ is fair ‘4’ is weak and ‘5’ is critical. The responsibilities of the Committee are as follows: • Determine the policy framework of the remuneration of employees of the Bank. Compliance Disclosures • Retain and attract the right calibre of management and staff by ensuring that they are appropriately remunerated for their contribution to the performance of the Bank and also The Bank achieved compliance with the prudential liquidity requirements in the second half of the year. A plan is in place for sustained compliance going forward. The Reserve Bank instructed the bank to address its illiquid balance sheet structure which to oversee the issue of key succession planning. comprises predominantly of fixed assets. The Bank has in place a fixed assets reduction plan aimed at reducing fixed assets to within • Determine the scope of pension arrangements and performance related pay schemes. the recommended acceptable benchmark of 25% of total assets. The Committee met four times in the period under review. The record of attendance by members of the Human Resources and Remuneration Committee is shown below: External Credit Ratings Rating Agent Global Credit Rating Company (GCR) Meetings held Date Issued Long Term Credit Rating Member 1 2 3 4 % Attendance November 2017 B Mr. D. Marandure     100 November 2018 CCC Mrs. F. Muyambo     100 July 2019 CC Mr. B. Ndebele     100 27 Corporate Governance Report Mr. E. Chawoneka    N 100

27.1 The Board KEY The Board is responsible to the shareholders for setting the direction of the Bank through the establishment of strategies, objectives,  Present key policies and management structures. It monitors the implementation of these strategies and policies through a structured ap- LOA Leave of absence granted proach to reporting and accountability and recognizes that it is responsible for developing relationships with its various stakeholders and it actively manages those relationships. N No longer or not yet a member

The Board is committed to high standards of corporate governance and believes that a sound governance structure engenders a successful company. Throughout the year ended 31 December 2020 the Bank has, in the Directors’ opinion, complied fully with the 27.6 Credit Committee tenets of good corporate governance. Metbank’s Board recognizes the critical importance of having an effective Board of Directors. The responsibilities of the Committee are as follows: The Board also places the highest importance on active engagement with its shareholders; meetings are held regularly with share- • Review and oversee the overall lending policy of the Bank. holders and the Board takes account of shareholders’ views. • Deliberate and consider loan applications beyond the discretionary limits of the Management Committee. • Review lendings made by the Credit Risk Management Committee. In the year to 31 December 2020, the Board met four times in line with Bank policy. The record of attendance • Direct and monitor the quality of lending book. by Directors is as follows: The Committee met four times in the year under review. The record of attendance by members of the Credit Committee is shown below: Meetings held Member 1 2 3 4 % Attendance Meetings held Mr. D. Marandure     100 Member 1 2 3 4 % Attendance Mr. B. N. Ndebele     100 Mrs. F. Muyambo     100 Mr. E. Chawoneka    N 100 Mr. D. Marandure N N   100 Dr. M. Maulana     100 Mr. B. N. Ndebele     100 Mrs. F. Muyambo     100 Mr. E. Chawoneka    N 100 Adv. B. Hungwe   N N 100 KEY     Mr. G. Chiome 100  Present     Mrs. S. Mandimika 100 LOA Leave of absence granted  Mr. C. Daitai N N N 100 N No longer or not yet a member

KEY  Present 27.7 Nomination Committee LOA Leave of absence granted The Committee’s terms of reference are; N No longer or not yet a member • To review the structure, size and composition (including the skills, knowledge and experience) of the Board at least annually and make recommendations on any proposed changes to the Board to complement the Bank’s corporate strategy; • To identify individuals suitably qualified to become Directors and select, or make recommendations to the Board on the selection of, individuals nominated for directorships; 27.2 Audit and Finance Committee • To assess the independence of Independent Non-executive Directors and The Audit and Finance Committee consists of four members all of whom are independent non-executive • To make recommendations to the Board on the appointment or reappointment of Directors and succession planning for Directors. directors. The Committee did not meet during the period under review. The effectiveness of individual Board members and the Board is assessed via peer to peer assessment, assessment of the chairman by the directors, chairman’s assessment of The committee meets at least four times a year to review the following: individual Board members, as well as an overall assessment of the Board by an independent consultant. • The adequacy and appropriateness of the Bank’s accounting and internal control system. • The Bank’s strategy and budgets. BY ORDER OF THE BOARD • Efficiency and effectiveness in the utilization of operational and capital esources.r P. Chenjera • The Bank’s financial statements and accounting policies. Company Secretary

DIRECTORS: Mr. D. Marandure (Chairperson) | Dr. M. Maulana (Vice Chairperson) | Mrs. F. I. Muyambo | Mr. B. N. Ndebele (Managing Director) | Mrs. S. Mandimika | Mr. C. Daitai | Mr. E. Chawoneka* | Mr. G. Chiome* (*Executive) stronger together! 6