Nedbank Group Limited is a bank holding company that operates as one of the four largest banking groups in South Africa through its principal banking subsidiaries, Nedbank Limited which is 100%, owned and Imperial Bank Limited, in which it has a 50.1% interest. The company''s ordinary shares have been listed on the JSE since 1969. The ultimate holding company of Nedbank Group is Old Mutual plc, listed on the London Stock exchange, which holds a 50.58% controlling stake.

The group offers a wide range of wholesale and retail banking services through three main business clusters:

- Nedbank Corporate;
- Nedbank Capital; and
- Nedbank Retail.

The principal services offered by the group comprise corporate and retail banking, property finance, investment banking, private banking, foreign exchange and securities trading. Nedbank Group also generates income from private equity, credit card acquiring and processing services, custodial services, unit trust and trust administration, asset management services and bancassurance. The major focus of Imperial Bank is the provision of motor vehicle finance.

Nedbank Group''s headquarters is in Sandton, Johannesburg, with large operational centers in Durban and Cape Town, which are complemented by an extensive branch and support network throughout South Africa and facilities in other southern African countries. These facilities are operated through Nedbank Group''s eight subsidiary and/or affiliated banks, as well as through branches and representative offices in London and on the Isle of Man to meet the international banking requirements of the group''s South African-based clients.

The proposed project is a subordinated Tier II-qualifying loan or instrument of up to ZAR1billion ($139 million equivalent) including funds for IFC''s own account.

140.73 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	140.73
Equity

* These investment figures are indicative

The proposed IFC investment will support the expansion, diversification and extension of the tenor of Nedbank''s capital in South Africa.

The project will strengthen the capital base of Nedbank and thereby improve its capacity to expand its activities in underserved market segments and less developed markets such as affordable housing finance and cross-border lending in Africa.

The project will enable the Bank to maintain its momentum in supporting critical BEE initiatives which will contribute to more sustainable distribution of South Africa''s economic growth.

Nedbank''s involvement in projects subject to Equator Principles will promote the application of international standard social and environmental guidelines to projects in South Africa and across the continent.

The project will increase the supply of Tier II financing of longer tenor, thereby supporting South African market development.

IFC''s role in the project is to:

- stimulate the expansion of banking activities to previously underserved market segments such as affordable housing, BEE financing, and cross border lending;
- aid the financial market development by playing an important role in the infusion of capital with longer term than it can presently attract in the market; and
- support Nedbank''s strategy to promote cross border investments in Africa.

This project has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure. During appraisal, IFC will analyze the FI portfolio, for types of transactions, size, tenor and industry sectors and determine the Applicable Requirements, if any, that would include a combination of:

- The IFC FI Exclusion List; and/or
- The applicable National Social and Environmental Laws and regulations; and/or
- The IFC Performance Standards.

IFC will also review, if required, the capacity of the FI to manage social and environmental risks and to establish and maintain a Social & Environmental Management System (SEMS). If required, IFC will suggest Supplemental Actions to address any gaps in the SEMS.

Based on the review, the bank will be required to:

- develop an, or upgrade, if necessary, any existing SEMS, prior to disbursement to the satisfaction of IFC;
- identify responsible, qualified persons to manage and implement the SEMS;
- commit to implement the SEMS, to ensure that its investments/activities are in compliance with the Applicable Requirements;
- submit a periodic report to IFC as per a format to be provided by IFC.