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BONDS & GUARANTEES - Santam

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BONDS & GUARANTEES
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Page 1: BONDS & GUARANTEES - Santam

BONDS & GUARANTEES

Page 2: BONDS & GUARANTEES - Santam

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ABOUT SANTAMSantam is the leading general insurer in South Africa with an annualised gross written premium of US$ 2,514* billion and total assets of US$ 3,134** billion. Sanlam (with a market cap of US$12 billion) has a 60% shareholding in Santam.

Santam has been offering insurance for 100 years and over this time, we have made it our business to understand what is important to our clients and the risks they face. This is why over 85 of the top 100 companies listed on the Johannesburg Stock Exchange (JSE) trust us to protect their businesses. This is what insurance good and proper is about.

KEY FACTS• Contribution to Sanlam Group net result from financial services 13% (2018: 10%*)• 22% market share in South Africa• 500 000 claims handled each year on average• Unmatched technical expertise and knowledge found in Specialist Business • Technically competent employees (qualified engineers, admitted attorneys, financial

analysts, etc.)• 85 of the top 100 listed JSE companies are insured by Santam • 6 076 permanent employees• US$ 1,4 billion* paid out in claims in 2018

* Used the average rate of (R/US$ of 13.17) at December 2018 to convert numbers from ZAR to US$.** Used the spot rate of (R/US$ of 14.39) at December 2018 to convert numbers from ZAR to US$.

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ABOUT SANTAM BONDS ANDGUARANTEES-A DIVISION OFSANTAMWe provide the service of issuing a project bond or guarantee to the beneficiary (employer, owneror creditor) of a project to cover the financial loss arising from the contractor (principal debtor)defaulting on his contractual obligations.

We issue both insurance and bank guarantees on behalf of our clients, directly or through anintermediary. Our footprint is vast; it covers most countries in Africa as well as Australia, USA andthe UK. We specialise in creating feasible and more economical alternatives to traditional bankguarantees which are demanded by most employers in foreign markets.

WHY SANTAM BONDS AND GUARANTEES IS THE BEST SOLUTION IN THE MARKETCredit rating: Standard & Poor’s (S&P) affirmed Santam’s rating at ‘BB+’; Outlook Stable global scale rating, at ‘zaAA+’ national scale rating and ‘bbb’ stand-alone credit profile.

Large capacity: We have a large capacity which means we have the ability to provide our clients with spare capacity to use for unexpected projects and / or very large “last minute” tenders.

Due to our strong balance sheet capability and ‘BB+’ rating we are the preferred Eskom and Transnet guarantor for all construction related guarantees.

Bank guarantee solutions: We have established strategic partnerships with four major international banks and have the capacity to issue bank paper guarantees.

A large African footprint: Our target market over the years has expanded to include emerging markets in Africa as growth rates and international investment in these markets are buoyant and growing. This footprint is made possible through our partnership with Sanlam Pan Africa. We have successfully issued guarantees into more than 30 countries in Africa.

In-house legal capability: Translates into service efficiency, cost effectiveness and the capability to engage with local and international experts to facilitate the issuance of local and foreign guarantees on behalf of our clients.

In-house financial consulting expertise: This is through Sanlam Capital Markets, it enables us to provide our clients with world-class financial advisory and support.

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OUR RANGE OF PRODUCTS ARE AS FOLLOWS: PRODUCT DESCRIPTION

BID BOND Covers the employer during the bidding process, and guarantees that the bidder abides by the conditions of the tender.

ADVANCE PAYMENT GUARANTEE

Covers the employer for the prepayment of monies advanced to the contractor, usually to cover cost of capital materials and equipment and to aid cash flow.

PERFORMANCE GUARANTEE

Covers the beneficiary against the risk of the contractor not fulfilling his contractual obligations in terms of the contract.

RETENTION GUARANTEE

Replaces monies ordinarily retained by the employer until project completion. Also used to protect the employer against failure of the contractor to rectify defects after project completion.

PAYMENT GUARANTEE

Covers the supplier of goods and services against non-payment by the buyer.

MATERIALS ON-SITE / OFF-SITE GUARANTEE

Covers the employer for the value of materials stored either on or off site by the contractor. Enables payment of these materials before these materials form part of “Work Done”

FUEL GUARANTEE

Covers a bulk fuel supplier against non-payment by a fuel purchaser. Purchasers can be commercial (distributors, wholesalers, fuel station owners) or retail (airlines, mines, construction and engineering companies, or logistics companies). It serves to ease the financial burden on bulk fuel purchasers to pay for fuel upfront or incur interest expenses by acquiring funding in the banking sector to purchase fuel.

UTILITY BONDS AND GUARANTEES

Utility payment bond: Covers the principal for the deposit or payment of monthly accounts on an electricity or water account that is, should a company fail to pay their bill, Santam will pay the utility provider.Utility performance bond: Covers a state owned utility provider against the risk of the contractor not fulfilling his contractual obligations in terms of the contract.

CUSTOMS AND EXCISE BONDS

Covers businesses involved in import, export, manufacturing, sales or distribution of goods. These bonds guarantee that either taxes or duties or both will be paid by the principal when invoiced by the government. These bonds also ensure that companies comply with all legal and tax acts and requirements related to their business.

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OUR UNDERWRITING RISK CRITERIAIn the current volatile economic climate, security for payment and risk management are important. We realise that although banks have started to lend money again, they remain cautious – and as a result they demand high levels of collateral security from their clients. With the backing of Santam’s financial strength, we offer clients Guarantee capacity of a world-class standard.

In order to qualify for a Guarantee Facility of this nature, the following criteria are evaluated. Facility terms will then be offered on the basis of a successful underwriting outcome.

FACILITY PARAMETERS GUARANTEE PARAMETERS

• Years of trading

• Revenue

• Retained income

• Order book size

• Project references, track record, resources

• Solvency, profitability, liquidity, gearing

• Paper security – indemnity, suretyship

• Material security – collateral

• Experience

• Scope

• Time/programme

• Cash flow

• Quantum

• Wording

• Max tenor: 72 months

• Employer

• Geography, etc.

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INDUSTRIES AND SECTORS WE SUPPORT1. Main contractors

2. Key sub-contractors: Earthworks, roads, infrastructure services

3. Engineer Procure Construction (EPC)

4. Operate and maintain contracts

5. Oil and gas

6. Renewable energy

7. Conventional energy (including nuclear energy)

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ABOUT THE SANLAM GROUPEstablished in 1918 as a life insurance company, Sanlam is a leading diversified Pan-African financial services group listed on the Johannesburg and Namibian Stock Exchanges.

Today, the Group has a business presence in 33 countries in Africa as well as in the USA, Malaysia, the UK, India and Australia.

Sanlam’s vision is to be a leader in client-centric wealth creation, management, and protection in South Africa; to be a a leading Pan-African financial services group with a meaningful presence in India and Malaysia and to play a role in wealth and investment in specific developed markets.

Sanlam is made up of five operating clusters namely; Sanlam Personal Finance, Sanlam Pan Africa (SPA) including Saham Finances, Sanlam Investments, Sanlam Corporate, Santam Limited (Santam). Two of these clusters (SPA including Saham Finances and Santam) have the capability of issuing Bonds and Guarantees in parts of Europe, the USA, the UK, Asia and some African countries.

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THE SANLAM GROUP AT A GLANCE The extent of our business (2018 results)• Total assets under management (Sanlam Investments) = R882 billion (US $ 67 billion*)• Operating profit before tax = R9 billion (US$ 683.4 million*)• New business volumes = R223 billion (US$ 17 billion*)• Net fund flows = R41.5 billion (US$ 3.1 billion*)• Personnel = 15 000 in Sanlam South Africa and 75 930 in associates and subsidiaries• Shareholders = 450 217• The Sanlam group office is responsible for centralised functions that include strategic direction,

financial and risk management, marketing and communications, human resources and informa-tion technology, sustainability management, corporate social investment and general services.

SANLAM CLUSTERS CAPABLE OF ISSUING BONDS AND GUARANTEES

SANLAM GROUP

* Used the average rate of (R/US$ of 13.17) at December 2018 to convert numbers from ZAR to US$.

Sanlam Pan Africa

Emerging markets excluding South Africa: Long-term insurance, general insurance, investments,

credit and banking

Santam Limited

Leading general insurance in South Africa

Largest Pan-African insurer in terms of issued premium (excluding South Africa)

Saham Finances

Page 10: BONDS & GUARANTEES - Santam

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ABOUT SANLAM PAN AFRICAThe Sanlam Pan Africa cluster is responsible for Sanlam’s financial business services (life insurance, general insurance, banking, retail credit, health, bancassurance, asset management and specialist general insurance products) in emerging markets outside South Africa with the aim of ensuring sustainable delivery and growth across the various businesses that make up this cluster. As part of the group’s vision, it strives to lead wealth creation and protection in those markets.

In March 2018, Sanlam Pan Africa increased its stake in SAHAM Finances to 100% enabling Sanlam to have a meaningful presence across sub-Saharan and North Africa as a natural extension of Sanlam’s international expansion strategy.

KEY FACTS• Net result from financial services US$ 142 million (2018: US$ 125 million*)• Contribution to Group net result from financial services 23% (2018: 21%)• Number of employees (subsidiaries): 4,730 (2018: 1 947)

* Used the average rate of (R/US$ of 13.17) at December 2018 to convert numbers from ZAR to US$.

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SANLAM’S BUSINESS PRESENCEIN AFRICA

NORTH AFRICA

CENTRAL AFRICA

SOUTHERN AFRICA

EAST AFRICA WEST AFRICA

Morocco

Tunisia

Algeria

Angola

Cameroon

Gabon

Democratic Republic of the Congo

Republic of the Congo

South Africa

Lesotho

Swaziland

Namibia

Zimbabwe

Botswana

Mauritius

Madagascar

Rwanda

Kenya

Uganda

Tanzania

Malawi

Zambia

Ghana

Nigeria

Côte d’Ivoire

Togo

Benin

Senegal

Mali

Burkina Faso

Guinea

Niger

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ABOUT SAHAM FINANCESFounded in 1995 by Moulay Hafid Elalamy, Saham Finances is the largest Pan-African insurer in terms of issued premium (excluding South Africa). It predominantly writes personal lines and commercial insurance business (which exceeds 80% of its portfolio). The group has built its success by tapping into the values and core beliefs guiding its work, namely the search for excellence, the commitment to the wider world and the achievement of social solidarity. Saham Finances has created a network that enjoys both a sound local foundation and openness to the macroeconomic and multicultural tendencies of a continent in full growth.

KEY FACTSIn every country in Africa and the Middle East where it is present, the group has been able to create a sustainable growth context while diversifying its activities. It has been able to develop new opportu-nities and position itself as a genuine reference partner in Africa.

SAHAM FINANCES

US$+1 billion in Net Sales

Largest Pan-African insurer in terms of issued premium

(excluding South Africa)

Presence in 26 countries across North, West and East Africa and the Middle East

3000 staff

subsidiaries and a network of 65

700 branches

* Used the average rate of (R/US$ of 13.17) at December 2018 to convert numbers from ZAR to US$.

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FOR MORE INFORMATION OR REQUEST FOR A GUARANTEE, FEEL FREE TO CONTACT:SOUTH AFRICA: SANTAM LTD. BONDS AND GUARANTEES11 Alice Lane, Sandton, Johannesburg

Clinton SpenceHead: Bonds and Guarantees

T +27 11 912 [email protected]

Lebo MashegoBusiness Developer

T: +27 82 779 [email protected]

Kishan SukaSenior Underwriter

T +27 11 912 [email protected]

Bonga SomhlahloSenior Underwriter

T: +27 11 912 [email protected]

KENYA: SANLAM KENYASanlam House, Kenyatta Ave, Nairobi

Nemwel SingombeNiche Business ManagerT +254 719 035 273 C +254 782 628 [email protected]

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TANZANIA: SANLAM TANZANIA4th Floor, Amani Place, Ohio Street,Dar es Salaam

Jared AwandoBusiness Development ManagerT +255 222 120 188C +255 766 372 [email protected]

UGANDA: SANLAM UGANDAPlot 18B, Clement Hill Road, Shimoni Office Village, Kampala

Brian KayimaBusiness Development ManagerT +256 312 207 025C +256 782 239 [email protected]

ZAMBIA: NICO INSURANCE FOR SANLAM GROUP1131 Corner, Parirenyatwa & Protea Roads, Fairview, Lusaka, Zambia

Tionge SimbeyeManager: Specialized RisksT +260 211 222 862C +260 977 122 [email protected]

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Page 15: BONDS & GUARANTEES - Santam

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2019 CALENDAR

SEPTEMBERS M T W T F S1 2 3 4 5 6 7

8 9 10 11 12 13 14

15 16 17 18 19 20 21

22 23 24 25 26 27 28

29 30

MAYS M T W T F S

1 2 3 4

5 6 7 8 9 10 11

12 13 14 15 16 17 18

19 20 21 22 23 24 25

26 27 28 29 30 31

JUNES M T W T F S

1

2 3 4 5 6 7 8

9 10 11 12 13 14 15

16 17 18 19 20 21 22

23 24 25 26 27 28 29

30

AUGUSTS M T W T F S

1 2 3

4 5 6 7 8 9 10

11 12 13 14 15 16 17

18 19 20 21 22 23 24

25 26 27 28 29 30 31

JANUARYS M T W T F S

1 2 3 4 5

6 7 8 9 10 11 12

13 14 15 16 17 18 19

20 21 22 23 24 25 26

27 28 29 30 31

FEBRUARYS M T W T F S

1 2

3 4 5 6 7 8 9

10 11 12 13 14 15 16

17 18 19 20 21 22 23

24 25 26 27 28

MARCHS M T W T F S

1 2

3 4 5 6 7 8 9

10 11 12 13 14 15 16

17 18 19 20 21 22 23

24 25 26 27 28 29 30

31

JULYS M T W T F S

1 2 3 4 5 6

7 8 9 10 11 12 13

14 15 16 17 18 19 20

21 22 23 24 25 26 27

28 29 30 31

OCTOBERS M T W T F S

1 2 3 4 5

6 7 8 9 10 11 12

13 14 15 16 17 18 19

20 21 22 23 24 25 26

27 28 29 30 31

NOVEMBERS M T W T F S

1 2

3 4 5 6 7 8 9

10 11 12 13 14 15 16

17 18 19 20 21 22 23

24 25 26 27 28 29 30

DECEMBERS M T W T F S1 2 3 4 5 6 7

8 9 10 11 12 13 14

15 16 17 18 19 20 21

22 23 24 25 26 27 28

29 30 31

APRILS M T W T F S

1 2 3 4 5 67 8 9 10 11 12 13

14 15 16 17 18 19 20

21 22 23 24 25 26 27

28 29 30

Page 16: BONDS & GUARANTEES - Santam

Santam is an authorised financial services provider (licence number 3416)


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