ANNUAL REPORT 2018 INTEGRATED REPORT INTEGRATED ’ ENGAGE. EXCHANGE. EXCEL. ADOPTING SUSTAINABILITY PRACTICES As part of our ongoing commitment to protect the environment and in line with our AfrAsia Think Green Programme, we have used Lenza Green paper for our Integrated Report 2018, which has below features: * Recycled paper produced with 100% recovered fibre according to the Forest Stewardship Council (FSC); *Manufactured without chlorine bleaching; and *High whiteness due to a special converting process for recovered fibre. Detailed Environmental Profile: 40/40 18/20 10/10 10/10 9/10 10/10 Fibre source Fossil CO2 emissions Waste to landfill Water pollution from Organic water Environmental from manufacturing bleaching pollution management systems ABOUT THIS REPORT Reporting Period Boundaries AfrAsia Bank Limited Integrated Report 2018 is a thorough report that This report includes information pertaining to AfrAsia Bank Limited and its addresses our Economic, Environmental, and Social performance for the subsidiaries. The boundaries for Key Performance Indicators have been Financial Year 2017 - 2018, as well as our vision and goals for the next clearly stated in light of our commitment to being more transparent with 3 years. regards to our stakeholders and other interested parties. Targeted Audience Forward Looking Statement This report is intended for all stakeholders of the Bank. The comprehensive Note that this report also includes forward-looking statements, which may report gives emphasis to material issues, value creation over the short, change in future in line with the corporate strategy and vision. medium and long-terms, as well as disclosure and transparency to enable our stakeholders to make informed decisions. Contact International Standards AfrAsia Bank Limited welcomes feedback and suggestions on this report, which may be communicated to Mrs. Luvna Arnassalon-Seerungen, Head of Our previous reports lay the groundwork for adopting the Integrated Corporate Sustainability & CSR, at [email protected]. Reporting Framework as directed by the International Integrated Reporting Council (IIRC). Our integrated report is drawn up in accordance with the GRI Reporting Principles, a set of standards that are essential to reporting non- financial metrics. AfrAsia Bank Limited (ABL) conducted its first “Materiality Assessment” in July 2018 to identify and prioritize material issues that matter most to our stakeholders. This report also highlights our achievement around the United Nations Sustainable Development Goals (SDGs) through our GRI Index. For the first time since its participation in the United Nations Global Compact (UNGC), AfrAsia Bank is submitting an Integrated Report as its Communication on Progress (COP) that communicates our efforts to support and uphold the Ten Principles of the UN Global Impact. AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 001 TABLE OF CONTENTS SECTION A CORPORATE PROFILE OUR APPROACH & OVERVIEW TO SUSTAINABILITY —— About—AfrAsia—Bank—Limited —— Sustainability—at—AfrAsia—Bank 008042 —— Chairman’s—Review 102 —— Stakeholder—Engagement —— Chief—Executive—Officer’s—Message —— Materiality—Assessment —— Our—Strategic—Focus —— Risk—Management—Report —— How—We—Create—Value CORPORATE GOVERNANCE OUR PERFORMANCE REPORT —— Financial—Capital —— Human—Capital —— Social—&—Relationship—Capital 178 —— Natural—Capital —— Intellectual—Capital —— Manufactured—Capital 002 AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 SECTION B MANAGEMENT DISCUSSION FINANCIAL STATEMENTS AND ANALYSIS —— —Certificate—from—the—Company— Secretary —— Corporate—Profile —— Independent—Auditors’—Report 216261 —— Business—Segments—Achievements 264 — —Statements—of—Profit—or—Loss—and— —— Economic—Outlook — other—Comprehensive—Income —— Chief—Financial—Officer—Statement —— Statements—of—Financial—Position —— Performance—Highlights —— Statement—of—Changes—in—Equity —— Statements—of—Cash—Flows STATEMENT OF MANAGEMENT’S —— Notes—to—the—Financial—Statements RESPONSIBILITY FOR FINANCIAL REPORTING AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 003 ADOPTING 004 AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 SUSTAINABILITY PRACTICES Our—“Responsible—Bank—2020”— goals—integrate—sustainability— principles,—such—as—the—triple— bottom-line—thinking—(People,— Planet,—and—Profit),—starting— with—our—employees—and—clients,— extending—to—our—stakeholders— and—trickling—down—into—our— ADOPTING communities. AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 005 006 AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 CORPORATE PROFILE & OVERVIEW About AfrAsia Bank Limited Chairman’s Review Chief Executive Officer’s Message Our strategic focus How we create value AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 007 CORPORATE PROFILE & OVERVIEW ABOUT AFRASIA BANK LIMITED AfrAsia in Numbers NUMBER—OF— NET—OPERATING—— VOLUNTEERING—— AFRASIA— CLIENTS—IN EMPLOYEES INCOME HOURS —KIDS 140 368 >MUR 1.8bn 478 30 COUNTRIES TOTAL—— TOTAL—DEPOSITS—— STAFF—— DIVIDENDS ASSETS FROM—CUSTOMERS TRAINING—HOURS >MUR 120bn >MUR 111bn >6,500 MUR >300 M All figures are for the Bank 008 AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 009 CORPORATE PROFILE & OVERVIEW OUR LOCATION AfrAsia—Bank—Limited—(“AfrAsia”,—the—“Bank”),—is— headquartered—in—Port—Louis,—Mauritius,—in—a—historic— building—dating—back—to—1879,—and—listed—as—a—National— Heritage—site.—The—Bank—also—has—a—branch—in—Ebène,—the— island’s—Cybercity,—further—strengthening—its—presence— in—Mauritius.—Additionally,—our representative—office— in—Johannesburg,—South—Africa,—provides—Customer— Service—to—our—regional—and—international—clients.—These— strategic—office—locations—serve—to—bridge—Africa—and— Asia,—the—two—fastest—growing—emerging—markets. 010 AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 pictures of Port Louis Port Louis office Ebene office AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 011 CORPORATE PROFILE & OVERVIEW STRATEGIC SHAREHOLDERS AfrAsia—Bank—Limited—is— backed—by—three—strategic— shareholders—who—provide—us— with—a—competitive—advantage— in—our—positioning—in—regional— The Bank’s anchor shareholder, Founded in 1859, National Intrasia Capital Pte Ltd (Group) is a and—global—markets. IBL Ltd, is the 1st business Bank of Canada (NBC) is one of Singapore established family office group in Mauritius (2018 Top the six systemically important and investment holding company. Its 100 Companies) and employs banks in Canada. operations are managed from Mauritius. more than 21,800 employees. It is an integrated provider Intrasia Group is mainly focused on IBL Group is active in various of financial services to retail, developing and managing international economic sectors, namely commercial, corporate, and public and private companies in the Agro, Building & Engineering, institutional clients. corporate and financial services Commercial, Financial Services, Headquartered in Montreal, industry, energy and resources, Hospitality, Manufacturing NBC has more than 23,000 properties and agriculture. In Mauritius, & Processing, Logistics , employees and 2.5 million it is the developer of the unique healthy Properties and Innovation. individual clients. Clients in Mighty Rice product and provides IBL Group is listed on the Stock the United States, Europe, corporate structuring and administration Exchange of Mauritius(SEM) and other parts of the world services. Its other businesses operate since the 14th of July 2016 are served through a network in Australia, Madagascar, Tanzania and and on the Stock Exchange of of representative offices, Mozambique. Mauritius Sustainability Index subsidiaries, and partnerships. The Group is the third largest (SEMSI) since September 2017. National Bank of Canada is shareholder of the Bank and provides It also has 6 companies listed listed on the Toronto Stock guidance and support to our on the SEM and 2 companies Exchange (TSX: NA) and its international expansion. listed on the SEMSI. long-term senior debt is rated http://www.intrasiacapital.com/ http://www.iblgroup.com/ A+ by Fitch and A by S&P as at July, 2018. https://www.nbc.ca 012 AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 THE—BANK’S—PROACTIVE— SHAREHOLDER—ENGAGEMENT—DRIVES— VALUE—ACROSS—THE—FLOOR—BY— “FOSTERING—RELATIONSHIPS—WITH—OUR— VARIOUS—STAKEHOLDERS,—LEVERAGING— OUR—BUSINESS—NETWORK,—AND— PROMOTING—THE—HIGHEST—LEVEL— OF—CORPORATE—GOVERNANCE „ MR JEAN-CLAUDE BÉGA Group Head of Financial Services and Business Development IBL GROUP Shareholder AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 013 CORPORATE PROFILE & OVERVIEW OUR STRUCTURE The—Bank—is—in—the—process—of—streamlining—its— overarching—group—structure,—including—the—liquidation— of—some—dormant—entities—as—shown—below: 100% 100% 100% AFRASIA CORPORATE AFRASIA CAPITAL AFRASIA CORPORATE FINANCE (AFRICA) MANAGEMENT LIMITED FINANCE LIMITED LIMITED UNDER—LIQUIDATION 014 AFRASIA BANK LIMITED AND ITS SUBSIDIARIES INTEGRATED REPORT 2018 GROUP STRUCTURE OF AFRASIA BANK LIMITED AND ITS GROUP ENTITIES - 30.06.2018 AfrAsia Bank Limited (THE—BANK) 100% 100% AFRASIA INVESTMENTS LIMITED AFRASIA HOLDINGS LIMITED 100% 100% 100% AFRASIA KINGDOM 23.99% HOLDINGS LIMITED AFRASIA CORPORATE AFRASIA CORPORATE FINANCE INTERNATIONAL FINANCE PTY 38.76% LIMITED LTD AFRASIA ZIMBABWE HOLDINGS LIMITED UNDER—LIQUIDATION