OMZIL MID YEAR 2021 FINANCIAL RESULTS FINAL From Lawrence 31AUG21

OLD MUTUAL
ZIMBABWE LIMITED
Consolidated Interim Abridged Financial Results
For the Six Months Ended 30 June 2021
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Chairman’s Statement
Inflation adjusted profit before tax was In view of the need to strengthen the capital base, and to support planned
growth initiatives, no interim dividend is proposed.
ZWL11.2 billion up from ZWL8.9 billion
Focus on building a stronger business
achieved in the same period last year. Notwithstanding the economic challenges and the adverse impact of
This in historical terms, translated to a COVID-19 we remain focused on building a strong business that delivers
value to customers, shareholders and the wider economy.
profit before tax of ZWL14.7 billion up
The Group continued to operate within a deliberately chosen responsible
from ZWL7.2 billion achieved prior year.
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business framework that seeks to ensure that it continues to create value
for the wider community.
The COVID-19 pandemic, however, poses a threat to the overall aggregate Within its core business, the Group and its business units continued to
K. C. Katsande earnings outlook. provide support to key economic sectors through financing and other
financial service activities. The initiatives supported through loan facilities
The ZSE All Share Index closed the period under review up 134.98%. and investment disbursements include the energy sector, foreign currency
Economic Environment
Activity on the USD denominated Victoria Falls Stock Exchange (VFEX) generating and import substitution agricultural activities, mining, and
A generalised sense of cautious optimism filled the environment during
remained subdued, with only one listed stock on the bourse, over the tourism.
the six months to 30 June 2021. Upside was primarily premised on
base-effect expectations following consecutive GDP contractions and period to date. Interest rates were depressed relative to inflation, driving
a general preference for listed stocks as an inflation hedging strategy. Over the period, the Group also continued to support the national
protracted COVID-19 induced downtime. Better than average 2020/21
Property performance remains subdued as collections are threatened by response to the COVID-19 pandemic. Over the period under review, this
agricultural output after a good rainy season also supported the overall
earnings disruptions associated with the COVID-19 pandemic. was done through interventions targeted at the frontline staff and health
earnings outlook, with strong numbers coming from maize and tobacco.
institutions, both in the public and the private sectors.
Treasury now expects the agriculture sector to grow by 34% from an
initial projection of 11%. Capturing the upside, the Minister of Finance, Maintenance of tight fiscal and monetary policies by authorities as
Outlook
the International Monetary Fund (IMF) and the World Bank have revised pronounced in the 2021 Mid-Term reviews demonstrate commitment to
Relative stability over the period under review remains under threat.
the country’s 2021 GDP growth forecasts upwards. stabilise key macro-economic variables and ensure policy certainty. Old
Downside risks hinge on policy fragility and COVID-19 induced
Mutual supports efforts by authorities aimed at stabilising the macro-
externalities. This notwithstanding, the baseline outlook presents a
Consumer inflation closed June 2021 at 106.64%, down from 348.59% at economic environment and strengthening the financial services sector.
notable upside, albeit from a low base. Upside is propped further by the
the end of December 2020 and a peak of 837.53% in July 2020. Monetary An environment in which savings and investments are encouraged, allows
impact of proceeds from the IMF Special Drawing Rights (SDR) allocation.
authorities predict that inflation will end the year between 25% to for the harnessing and efficient allocation of resources for investment in
From a contraction of 4.1% last year, the World Bank and IMF project
35%. Exchange rates also registered noteworthy stability, with the ZWL the various economic sectors. The restoration and sustaining of confidence
growth to close 2021 at 3.9% and 6%, respectively, against Treasury’s
depreciating 4.26% during the six months to 30 June 2021, compared to in the financial services sector, notably the banking and insurance sub-
revised forecast of 7.8%.
70.76% during the corresponding period last year. This notwithstanding, sectors will only serve to support sustainable growth of the economy into
the widening premium between the official and alternative market the future.
Appreciation
exchange rates and settlement bottlenecks on the auction market remain
On behalf of the Board, I would like to thank our customers for their
a major concern. Regulatory interventions through the introduction of Financial performance
continued support and trust throughout the first half of 2021. I would
Statutory Instrument (SI)127 of 2021 Presidential Powers (Temporary The Group posted a solid performance during the half year under review
also like to thank my fellow directors as well as the directors of all our
Measures) (Financial Laws Amendment) reflect the fragile state of the despite headwinds caused by COVID-19 and the macro-economic
subsidiaries for their contributions to the effective steering of our business
currency market. The SI (127 of 2021) introduced penalties for common environment. Inflation adjusted profit before tax was ZWL11.2 billion
during the period under review.
violations of exchange control regulations. Overall, monetary policy up from ZWL8.9 billion achieved in the same period last year. This in
remains a work in progress under the prevailing multi-currency regime. historical terms, translated to a profit before tax of ZWL14.7 billion up
Government efforts to expand access to vaccines during the first half of from ZWL7.2 billion achieved prior year.
the year are to be commended and it is hoped that this will contribute
to minimising disruptions caused by the pandemic on economic activity. The Group Chief Executive Officer’s report provides detailed analysis of
the operating and financial results.
Chief Executive Officer’s Review

investments was skewed towards supporting special interest sectors such Performance on the historical cost basis
as energy or small and medium size enterprises. We continue to seek On a historical cost basis, we recorded profit before tax of ZWL14.7
opportunities where we can collaborate with regulatory authorities with a billion up from ZWL7.2 billion achieved in prior period. Life and general
view to develop prescribed assets (PAs) that preserve value for customers insurance businesses net earned premiums (NEP) witnessed a growth of
and protect policyholder investments in the current environment. 517%, achieving NEP of ZWL3.3 billion for the period to 30 June 2021
up from ZWL534.4 million in 2020. This growth was a result of increases
Transforming the business in the nominal value of premiums due to the impact of inflation and
Significant effort and investment were applied to an ongoing currency depreciation as well as growth in volumes. Investment returns
transformation program which covers the whole Group to position it were ZWL41.7 billion up from ZWL31.2 billion in the prior year driven
more competitively for the current times and for the future. We launched by significant gains on listed equities and translation of foreign currency
the MyOldMutual Digital platform on the 24th of June 2021 allowing denominated investments. Banking interest income increased by 494%
customers to insure and invest on the mobile phone as well as performing to ZWL2.2 billion largely driven by growth in interest earning assets, which
their banking transactions via USSD and WhatsApp. Current efforts are were influenced by a combination of translation of loans denominated in
focusing on driving adoption of as well as further enhancing the breadth foreign currency, local currency inflation and growth in lending activity.
of services and functionality that can be accessed on the platform. Fees and commission income grew by 460% to ZWL2.8 billion driven
by growth in volume of transactions in the digital and internet banking
In addition to the MyOldMutual platform, we further enhanced remote space and an increase in nominal values of transactions.
access to our products and services by customers without having
Sam Matsekete to physically visit a branch by launching the Eezy Credit on mobile, Operating and administration expenses increased by 443% to ZWL2.8
enablement of online USD transactions, zero rating of data costs on billion from ZWL511.7 million in the comparable prior period. Expenses
mobile and WhatsApp banking access by customers on the Econet continue to be driven by inflationary pressures and currency devaluation
Introduction network, and configuring USD cash withdrawals on ATMs. impacts on foreign denominated expenses. The business has also been
spending on new initiatives designed to make the business future fit and
At the beginning of the 2021 financial year, we sought to deliver value for We made progress in replacing legacy systems and automating some on new products and services designed to improve customer experiences
our stakeholders by focusing on: of our processes such as maintenance, and customer communication and offer market relevant products.
• Defending value and ensuring customers are enabled to exercise activities relating to pensions which are now robotic processes. These
more choice and options within our offering. initiatives are being carried out with a view to enhance customer Historical cost total assets increased by 51% to ZWL138.6 billion as at
• Transforming the business to meet the needs and expectations of our experience, optimise operating efficiencies, and drive innovation. Our 30 June 2021, up from ZWL92.1 billion as at 31 December 2020. The
customers more effectively. innovation hub, Eight2Five, together with its partner launched the 2021 growth was driven largely by investment gains, revenue generated, and
• Supporting and accessing the pockets of growth available in identified Value Creation Challenge. This is a national initiative aimed at identifying increased lending in both foreign and local currency. Consolidated net
sectors of the economy. and supporting business ideas that provide innovative and sustainable equity increased by 95% from ZWL15.2 billion to ZWL29.6 billion driven
• Ensuring that the business responds to mitigate the risks emanating solutions to socio-economic challenges. by growth in profit.
from the external environment including the impact of COVID-19.
Supporting and accessing growth opportunities Corporate social responsibility initiatives
These focus areas continued to guide our efforts during the period. We expanded the options of money transfer agencies available within The Group continued to support the community through several
our branches which now include World Remit, Senditoo, and Mukuru initiatives. Some of the key initiatives supported so far in 2021 are:
Efforts to defend value and provide relevant offerings and customers can readily access any of these services during our • Donated personal protective equipment to public and private
We sustained our efforts in adapting our value proposition to better standard operating hours. We continue to pursue viable partnerships hospitals across the country.
meet the needs of our customers and clients. This involves continually in this space. We finalised agreements with the European Investment • Rehabilitation of boreholes at multiple health centres across the
assessing the relevance of our products in the current environment with Bank (EIB) for a €15 million facility that will be used to extend foreign country.
customer engagement as a key focus area. Our aim is to ensure that our currency lending to productive sectors of the economy. We continue to • Supported renovation of Montagu Clinic which is treating COVID-19
customers remain aware and up to date regarding the impact of any provide our customers with international payments services through our patients.
macro-economic developments and legislative changes on the products correspondent banking relationships. • Financial literacy training.
and services they access from any of our business units. Consequently, • Top Companies Awards in partnership with Financial Gazette.
customers are updated on a regular basis as to the performance of their In line with our strategy to complement our life assurance offering with • Supported the arts industry through the Amazing Voices program as
funds invested with us as well as the full range of alternative products we the inclusion of end to end funeral services, we opened our first funeral well as through the sponsorship of virtual concert performances by
offer for their benefit. parlour in Bulawayo and commenced offering services to customers in various local artistes.
that city and the surrounding areas. Our focus is now on expanding our
In the life business the Guaranteed Fund bonus continues to be declared geographical presence and fully resourcing the operation to support our Focus areas for the second half of 2021
monthly to pass on value to customers on a more frequent basis. We growth ambition. The micro-finance business scaled up on its operations We believe that our focus areas for 2021 provide solid building blocks
launched the Flexi Term Plan product which will offer more flexibility to leveraging merchant partnerships to grow its loan book. for a strong business that will be able to continue delivering value to
customers mitigating the adverse effects of inflation. Across all business customers and shareholders into the future. We will therefore continue
units we broadened our offering to give our customers more flexibility Responding to the impact of COVID-19 executing initiatives that fortify the progress made in the first half of the
in the way that they seek to grow and protect their assets or the way in We are still living with the harsh realities of the COVID-19 pandemic and year in our broad focus areas which I mentioned at the beginning of
which they seek to manage risks. In the micro-finance business, the loan its effect on business. In response, the business continues to prioritise the this half year review. Some of the key initiatives we intend to deliver on
tenure for salary-based loans was increased in response to feedback from safety of customers, staff and the communities it serves. We expanded include:
customers. and enhanced our digital platforms and customers were encouraged to • Continuing to strengthen the relevance of our product offerings and
access the Group’s services remotely on these digital platforms. distribution channels.
Though there has been a notable slow-down in inflation, the current • Expanding the reach of our end to end funeral services offering.
levels remain high and with it, the risk of loss of value. Our investment Most of the Group’s employees have been enabled to work from home • Building on the momentum and gains achieved in our digital
approach continued to skew towards non-monetary assets to mitigate to ensure continuity of service while observing the control measures and transformation.
the impact of high levels of inflation on customer value as well as the guidance from health authorities. Customers that need to physically • Continuing to diversify our investment portfolio.
capital of the business. Wherever possible and subject to regulatory access branches continue to be served under appropriate measures to • Continuing to explore opportunities to be more efficient and to
approvals, we continued to explore ways to access investments that carry promote the safety of customers and staff. enhance customer experience across our touch points
foreign assets. We welcome legislative efforts under way to create space
for insurance and pension funds to access offshore investments, which In support of the national response to COVID-19, the business provided Appreciation
would help with diversification. healthcare staff at public and private hospitals with protective gear and On behalf of the entire management team, I would like to thank our
medical consumables. We are also running a campaign in support of the customers for their continued support and the trust they continue to
The business complied with all regulatory capital requirements and ongoing national immunisation program. repose in Old Mutual. I also thank our regulators for their support and
sustained capital levels to cover possible stress events while supporting continued productive engagement over many areas of our business.
the business’ growth aspirations. Financial performance My appreciation also goes to the boards and my colleagues across the
Group for their efforts and commitment to steer the business through the
We continued to invest in infrastructure and real estate projects alongside Performance on the inflation adjusted basis current difficult business environment.
other conventional investments. Over the period we concluded a The Group registered a commendable set of financial results achieving
transaction for the purchase of a vacant piece of land along the Zambezi an inflation adjusted profit before tax of ZWL11.2 billion up from ZWL8.9
River gorge which is under the tourism sector. We also completed phase billion achieved in the same period last year. Inflation adjusted total
1 of the construction of Palm River Hotel in Victoria Falls, together with assets increased by 23% from ZWL114.6 billion as at 31 December 2020
our joint venture partner. This development creates additional exposure to ZWL141.3 billion as at 30 June 2021 with nominal growth of 51%
to tourism assets in the fast-developing Victoria Falls area. An equivalent higher than inflation for the year to 30 June 2021 of 20.69%. The inflation
of USD18.4 million was deployed into private equity and infrastructure adjusted equity as at 30 June 2021 was ZWL31.3 billion, up from the
related projects in the first half of 2021. A significant part of these comparable ZWL20.8 billion in 2020.
2 Directors: K.C Katsande (Chairman), S. Matsekete (Group Chief Executive Officer), I.T. Mashinya (Group Chief Operating Officer), N.T.T. Mudekunye (Group Chief Financial Officer), Dr. K. Mandevani,
C. Chinaka, A. Daka, Dr. C. Dhliwayo, N. Samuriwo, C. Ross
Directors’ Report
Responsibility will be realised by the Group under the arrangement. Since 2019, the RBZ has approved the registration of
various debts owing to parties outside Zimbabwe as legacy debts. A key requirement under IFRS, of the need
The directors are responsible for the preparation and fair presentation of the Group half year financial for a contractual obligation to perform on the part of the other party for asset recognition criteria to be met
statements, comprising the statement of financial position as at 30 June 2021; and the statements of profit or is not present in this instance.
loss; comprehensive income; changes in equity and cash flows for the six months ended 30 June; and the notes
to the financial statements which include a summary of significant accounting policies and other explanatory The directors are not aware of other areas of non-compliance with IFRS in the financial statements for
notes, in accordance with International Financial Reporting Standards and the requirements of the Companies the half year ended 30 June 2021. However, the directors would like to draw the attention of users of the
and Other Business Entities Act (Chapter 24:31). In addition, the directors are responsible for preparing the financial statements to the fact that prevailing market conditions in Zimbabwe have required the use of
directors’ report. The directors are also responsible for such internal control as the directors determine is more judgement than would normally be the case around areas such as property valuations and valuation
necessary to enable the preparation of financial statements that are free from material misstatement, whether of unlisted investments. In addition, there are a wide range of views in the market concerning economic
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due to fraud or error, and for maintaining adequate accounting records and an effective system of risk variables such as inflation and exchange rates. While management believe that these factors have been
management. The directors have assessed the ability of the Group to continue as a going concern and have no sufficiently considered in the half year financial statements and that the required accounting judgements
reason to believe that the business will not be a going concern in the foreseeable future. are appropriate, additional disclosures and sensitivities have been provided and readers of the financial
statements should pay close attention to these. Details of key accounting judgements and sensitivities are
Compliance with legislation provided in Notes 2.2, 10.1, 10.2, 11.6, 13.2, and 18. Notwithstanding the identified area of non-compliance
with IFRS, directors are of the view that the accounting treatments as adopted are appropriate to the extent
These financial statements, which have been prepared on an inflation adjusted basis, are based on the which is practically possible given the peculiarities of the Zimbabwe economic and regulatory environment.
application of inflation indices on underlying accounting records which were maintained on the historical cost Users of the financial statements are, however, encouraged to exercise due caution and judgement.
convention (except for fair value measurement where applicable). The statements agree with the underlying
books and records and have been prepared in accordance with the accounting policies set out in note 2, and Capital
comply with the disclosure requirements of the Companies and Other Business Entities Act (Chapter 24:31)
and the relevant regulations made there under, the Insurance Act (Chapter 24:07), the Pension and Provident The issued share capital is made up of 249,035,156 “A” class shares of ZWL0,0000032 each, 83,011,718
Funds Act (Chapter 24:09), the Microfinance Act (Chapter 24:29), the Building Societies Act (Chapter 24:02), the “B” class shares of ZWL0,0000032 each, 1 redeemable preference share of ZWL1.00 and 1 “A” redeemable
Banking Act (Chapter 24:20), the Asset Management Act (Chapter 24:26), the Collective Investments Schemes preference share of ZWL1.00. The shares are owned by Old Mutual Zimbabwe Holdco Limited (75%); as well
Act (Chapter 24:19), and the Securities Act (Chapter 24:25). as allocations to Indigenisation Trusts and various other shareholders (22.2%) and a strategic partner (2.8%).
The 1 redeemable preference share issued is owned by Old Mutual (Zimbabwe) Dividend Access Trust and
Compliance with IFRSs the 1 “A” redeemable preference share by OML (Zimbabwe) Dividend Access Trust.
The financial statements are prepared with the aim of complying fully with International Financial Reporting Directors
Standards (IFRSs). IFRSs comprise interpretations adopted by the International Accounting Standards Board
(IASB), which include standards adopted by the IASB and interpretations developed by the International Mr KC Katsande* (Chairman)
Financial Reporting Interpretations Committee (IFRIC) or by the former Standing Interpretations Committee Mr S Matsekete** (Group Chief Executive Officer)
(SIC). Mr IT Mashinya** (Group Chief Operating Officer)
Mr NTT Mudekunye** (Group Chief Financial Officer)
Complying with IFRSs achieves consistency with the financial reporting framework adopted by the ultimate Mr C Chinaka
parent company, Old Mutual Limited, which is incorporated in South Africa. Using a globally recognised Mr A Daka
reporting framework also allows comparability with similar businesses and consistency in the interpretation Dr CL Dhliwayo
of the financial statements. The IFRS Conceptual Framework, provides that in applying fair presentation to Dr K Mandevani
the financial statements, entities should go beyond consideration of the legal form of transactions and other Mrs N Samuriwo
factors impacting on the financial statements to also consider the underlying economic substance therein. Ms C Ross
There was a decision by the directors to recognise a receivable under the ‘legacy debt/blocked funds’ *Mr K C Katsande was appointed the Board Chairman with effect from 28 January 2021.
arrangement announced by the Reserve Bank of Zimbabwe (the RBZ) in terms of Exchange Control Directive
RU28 of 2019. While the arrangement does not represent a contractual obligation on the part of the RBZ, the **Denotes Executive Director.
directors believe that a constructive obligation exists, based on a legitimate expectation that the cashflows
Reconciliation of IFRS Profit Before Tax to Result Group Statement of Financial Position
from Operations Before Tax As at 30 June 2021
Inflation Adjusted Historical Cost
30-Jun-21 30-Jun-20 30-Jun-21 30-Jun-20
30-Jun-21 31-Dec-20 30-Jun-21 31-Dec-20
Group Group Group Group
ZWLm ZWLm ZWLm ZWLm
Notes ZWLm ZWLm ZWLm ZWLm
Profit before tax 11,150.7 8,938.8 14,679.0 7,206.6

Assets
Adjusting entries (8,444.7) (4,861.3) (12,306.6) (5,332.1) Investment property 10 26,426.0 27,566.6 26,426.0 22,841.2
Shareholder investment returns (10,172.2) (6,192.2) (12,324.3) (5,340.2) Property and equipment 6,629.0 6,355.7 4,813.7 4,235.6
Monetary loss- non-operating items 1,693.7 1,309.0 - - Intangible assets 636.1 654.6 193.4 93.5
Policyholder tax 33.8 21.9 17.7 8.1 Deferred acquisition costs 43.9 30.5 40.1 17.2
Results from operations 2,706.0 4,077.5 2,372.4 1,874.5 Reinsurer contracts 302.3 262.0 281.2 171.8
Investments and securities 11 76,525.5 47,532.2 76,525.5 39,384.3
Results from operations represents the view of the directors of Old Mutual Zimbabwe Limited of the core operating performance of the Group. Deferred tax assets 21.5 1.8 9.9 7.0
Current tax receivable 24.5 73.0 24.5 60.5
Loans and advances 12 16,215.4 8,555.6 16,215.4 7,089.0
Other assets 13 11,494.8 14,644.4 11,043.0 10,769.7
Group Statement of Profit or Loss Cash and cash equivalents 2,983.7 8,914.5 2,983.7 7,386.4
For the Six Months Ended 30 June 2021 Total assets 141,302.7 114,590.9 138,556.4 92,056.2

Inflation Adjusted Historical Cost Liabilities
30-Jun-21 30-Jun-20 30-Jun-21 30-Jun-20 Insurance contract liabilities 14 75,372.7 57,374.7 75,325.7 47,431.0
Group Group Group Group Investment contract liabilities 15 5,195.5 3,952.5 5,195.5 3,275.0
Notes ZWLm ZWLm ZWLm ZWLm Provisions 561.3 559.1 561.3 463.3
Deferred tax liabilities 703.9 622.5 579.4 437.3
Revenue Current tax payables 78.8 2.8 78.8 2.3
Gross earned premiums 4 3,925.6 2,252.4 3,693.9 657.8 Amounts due to group companies 16 7,987.7 8,807.3 7,987.7 7,297.6
Outward reinsurance (423.4) (489.1) (396.4) (123.4) Amounts owed to bank depositors 17 14,087.7 15,734.4 14,087.7 13,037.2
Net earned premiums 3,502.2 1,763.3 3,297.5 534.4 Credit lines 3,814.0 3,806.4 3,814.0 3,153.9
Other liabilities 2,225.2 2,890.2 1,279.4 1,771.5
Investment income (non-banking) 5 29,016.1 29,542.3 41,688.0 31,223.7 Total liabilities 110,026.8 93,749.9 108,909.5 76,869.1
Banking interest and similar income 6 2,274.3 1,197.5 2,155.6 362.8
Fee income, commissions, and income from service contracts 7 2,963.2 1,693.2 2,790.6 498.1 Net assets 31,275.9 20,841.0 29,646.9 15,187.1
Other income 434.5 3,909.3 423.4 1,881.0
Total revenue 38,190.3 38,105.6 50,355.1 34,500.0 Shareholders’ equity
Share capital and premium - - - -
Expenses Non-distributable reserve - - 54.9 54.9
Claims and benefits (including change in insurance Revaluation reserve 1,528.6 1,857.9 2,503.3 2,358.3
contract provisions) 8 (19,215.6) (23,097.7) (29,398.9) (24,597.2) Share based payment reserve 1,475.7 1,475.7 71.7 71.7
Reinsurance recoveries 135.5 114.5 124.1 32.4 Retained earnings 27,772.6 17,109.5 26,480.6 12,359.5
Net claims incurred (19,080.1) (22,983.2) (29,274.8) (24,564.8) Equity holders of the parent 30,776.9 20,443.1 29,110.5 14,844.4
Non-controlling interests 499.0 397.9 536.4 342.7
Change in provision for investment contract liabilities (785.2) (1,100.1) (1,877.6) (1,804.7) Total equity 31,275.9 20,841.0 29,646.9 15,187.1
Fees, commissions, and other acquisition costs (921.1) (597.0) (863.8) (176.4)
Banking interest expense and similar expenses 6 (121.7) (301.3) (111.5) (86.2)
Impairment charges (771.9) (309.2) (771.9) (149.6)
Group Statement of Cash Flows

Other operating and administration expenses 9 (3,068.5) (1,892.2) (2,776.5) (511.7)
Net monetary adjustment (2,291.1) (1,983.8) - -
Profit before tax 11,150.7 8,938.8 14,679.0 7,206.6 For the Six Months Ended 30 June 2021

Income tax expense (386.5) (31.8) (364.2) (6.5) Inflation Adjusted Historical Cost
30-Jun-21 30-Jun-20 30-Jun-21 30-Jun-20
Profit for the period 10,764.2 8,907.0 14,314.8 7,200.1 Group Group Group Group
ZWLm ZWLm ZWLm ZWLm
Attributable to non-controlling interests 101.1 99.8 193.7 170.0
Attributable to owners of parent company 10,663.1 8,807.2 14,121.1 7,030.1 Net cash from operating activities (4,970.0) 4,279.3 (3,829.6) 5,116.7
10,764.2 8,907.0 14,314.8 7,200.1
Net cash used in investing activities (1,157.5) (5,949.0) (732.4) (3,104.3)

Group Statement of Comprehensive Income

Net (decrease)/ increase in cash and cash equivalents (6,127.5) (1,669.7) (4,562.0) 2,012.4

For the Six Months Ended 30 June 2021 Net foreign exchange differences on cash and cash equivalents 196.7 577.5 159.3 226.2

Cash and cash equivalents at the beginning of the period 8,914.5 9,260.6 7,386.4 1,707.5
30-Jun-21 30-Jun-20 30-Jun-21 30-Jun-20

Cash and cash equivalents at the end of the period 2,983.7 8,168.4 2,983.7 3,946.1
ZWLm ZWLm ZWLm ZWLm

Profit for the period 10,764.2 8,907.0 14,314.8 7,200.1

Other comprehensive income
Items that will not be reclassified to profit or loss
Property revaluation (344.9) 1,142.5 405.3 1,739.7
Shadow accounting 15.6 (410.1) (260.3) (624.6)

Total comprehensive income for the period 10,434.9 9,639.4 14,459.8 8,315.2

Total comprehensive income attributable to:
Owners of parent company 10,333.8 9,539.6 14,266.1 8,145.2
Non-controlling interests 101.1 99.8 193.7 170.0
10,434.9 9,639.4 14,459.8 8,315.2
Group Statement of Changes In Equity
For the Six Months Ended 30 June 2021
Share Share based Regulatory Equity holders
capital & Revaluation payment provisions Currency Retained of the parent Non-controlling Equity
Inflation Adjusted premium reserve reserve reserve Conversion earnings total interests total
2021 ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm
Shareholders’ equity at beginning of period - 1,857.9 1,475.7 - - 17,109.5 20,443.1 397.9 20,841.0

Profit for the financial period - - - - - 10,663.1 10,663.1 101.1 10,764.2
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Shadow accounting - 15.6 - - - - 15.6 - 15.6
Revaluation of property - (344.9) - - - - (344.9) - (344.9)

Total Comprehensive income for the period - (329.3) - - - 10,663.1 10,333.8 101.1 10,434.9
Shareholders’ equity at end of the period - 1,528.6 1,475.7 - - 27,772.6 30,776.9 499.0 31,275.9

2020
Shareholders’ equity at beginning of period - 1,570.0 1,353.3 30.8 (277.1) 9,675.4 12,352.4 262.0 12,614.4
Transfer between reserves - regulatory impairment allowance - - - (30.8) - 30.8 - - -

Profit for the financial period - - - - - 8,807.2 8,807.2 99.8 8,907.0
Shadow accounting - (410.1) - - - - (410.1) - (410.1)
Revaluation of property - 1,142.5 - - - - 1,142.5 - 1,142.5

Total Comprehensive income for the period - 732.4 - (30.8) - 8,838.0 9,539.6 99.8 9,639.4
Movement in share based payment reserve - - 8.7 - - - 8.7 - 8.7
Change of interest in subsidiary - - - - - (1.3) (1.3) (1.7) (3.0)
Transactions with shareholders - - 8.7 - - (1.3) 7.4 (1.7) 5.7
Shareholders’ equity at the end of the period - 2,302.4 1,362.0 - (277.1) 18,512.1 21,899.4 360.1 22,259.5

Share Non- Share based Regulatory Currency Equity holders Non-
capital & distributable Revaluation payment provisions conversion Retained of the parent controlling Equity
Historical Cost premium reserve reserve reserve reserve reserve earnings total interests total
2021 ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm
Shareholders’ equity at beginning of period - 54.9 2,358.3 71.7 - - 12,359.5 14,844.4 342.7 15,187.1

Profit for the financial period - - - - - - 14,121.1 14,121.1 193.7 14,314.8
Shadow accounting - - (260.3) - - - - (260.3) - (260.3)
Revaluation of property - - 405.3 - - - - 405.3 - 405.3

Total Comprehensive income for the period - - 145.0 - - - 14,121.1 14,266.1 193.7 14,459.8
Shareholders’ equity at end of the period - 54.9 2,503.3 71.7 - - 26,480.6 29,110.5 536.4 29,646.9

2020
Shareholders’ equity at beginning of period - 54.9 453.1 62.1 5.7 (13.3) 1,511.3 2,073.8 62.4 2,136.2

Transfer between reserves - regulatory impairment allowance - - - - (5.7) - 5.7 - - -
Profit for the financial period - - - - - - 7,030.1 7,030.1 170.0 7,200.1
Shadow accounting - - (624.6) - - - - (624.6) - (624.6)
Revaluation of property - - 1,739.7 - - - - 1,739.7 - 1,739.7

Total Comprehensive income for the period - - 1,115.1 - (5.7) - 7,035.8 8,145.2 170.0 8,315.2
Movement in share based payment reserve - - - 4.2 - - - 4.2 - 4.2
Change of interest in subsidiary - - - - - - (0.3) (0.3) (1.0) (1.3)
Transactions with shareholders - - - 4.2 - - (0.3) 3.9 (1.0) 2.9
Shareholders’ equity at the end of the period - 54.9 1,568.2 66.3 - (13.3) 8,546.8 10,222.9 231.4 10,454.3
Notes to the Financial Statements Statutory Instrument 142 of 2019 (SI142) was promulgated in June 2019 which effectively established the ZWL as the
sole currency, restricting the use of the USD for domestic transactions. The RBZ then introduced a weekly Reuters based
For the Six Months Ended 30 June 2021 foreign exchange auction, with the first auction held on 23 June 2020, thereby replacing the interbank system. The trades
are conducted weekly with the rate from the last auction being the official rate for the week. The auction determined
1. General Information rate has become the official exchange rate used in converting foreign denominated transactions and balances in these
Old Mutual Zimbabwe Limited (OMZIL) and its subsidiaries are incorporated in Zimbabwe. These consolidated financial financial statements. The closing exchange rate as at 30 June 2021 was ZWL85.42340. The Group has been able to access
statements comprise the Group and its Subsidiaries (collectively the ‘Group’ and individually ‘Group companies’). The funds from the auction to make foreign payments since inception.
Group’s subsidiaries and main activities were as follows:
- Central Africa Building Society (CABS) - mortgage lending and banking; The Zimbabwean government gazetted Statutory Instrument (SI) 185 of 2020 on July 24, 2020. The regulation compelled
- Old Mutual Life Assurance Company Zimbabwe Limited (OMLAC) - life assurance, pension and employee benefits sellers of various goods and services to display, quote, and offer prices in both the Zimbabwean dollar and foreign
services; currency at the ruling exchange rate (that is, the last established auction rate). Therefore, in accordance with International
- Old Mutual Investment Group Zimbabwe (Private) Limited (OMIG) - asset management; Accounting Standard 21 (IAS 21) “The effects of changes in foreign exchange rates”, entities need to assess what their
- Old Mutual Securities (Private) Limited (OMSEC) - licensed securities dealing firm; functional currency is. The Group’s assessment was that based on weighing the volume of the local currency business
- Old Mutual Finance (Private) Limited (OMFIN) - credit only micro-finance company; and against the foreign currency business, the Group’s functional currency was ZWL during the half year ended 30 June 2021.
- RM Insurance Holdings Company Limited (RMI), with an operating subsidiary, Old Mutual Insurance Company (Private)
Limited (OMICO) - short term insurer. 2.2.2 Foreign denominated Legacy debts /Blocked funds
In June 2019, the RBZ directed/invited all parties with Legacy Debts to apply for registration in order to guarantee
The holding company (OMZIL) is a 75% owned subsidiary of OM Zimbabwe Holdco Limited which is ultimately a wholly settlement of these debts at the rate of 1:1. The Group made applications relating to amounts incurred in USD between
owned subsidiary of Old Mutual Limited, listed on the Johannesburg and Namibia Stock Exchanges. 2012 and 2018, when the functional currency was USD and prior to promulgation of SI 33 of February 2019, to providers
of offshore lines of credit as well as related parties within the wider Old Mutual Limited Group. CABS got approval for
2. Accounting Policies USD27.7 million owing mostly to loan repayments for offshore lines of credit and foreign suppliers of goods and services.
OMZIL also got approval for USD83.8 million in respect of unremitted dividends (USD32.1 million), obligations under
2.1 Basis of preparation the 2012 indigenisation transaction (USD50 million), and management fees (USD1.7 million). OMLAC got approval for
The financial statements provide information about the financial position, results of operations, and changes in the USD0.5 million relating to unpaid service fees. Upon transferring local funds for the registration of legacy debts/blocked
financial position of the Group. The financial statements are prepared in Zimbabwe dollars. The symbol “$” denotes funds a legitimate expectation to receive cashflows under the arrangement was created and a financial instrument was
Zimbabwe dollars unless explicitly indicated otherwise. They are based on the statutory records that are maintained recognised on the Group’s statement of financial position, reflecting the value of expected cashflows.
under the historical cost convention and restated to consider the effects of inflation in accordance with the International
Accounting Standard 29 (IAS 29) “Financial Reporting in Hyperinflationary Economies”. This financial instrument has been fair valued on the assumption that a right to acquire an amount equivalent to
the debt registered at a future date now exists. The carrying value of the financial instrument reflects management’s
In 2019 Zimbabwe met the key indicators of being a hyperinflationary economy as described under IAS 29. The inflation assessment of the present value of the expected net cashflows to be received under this arrangement. The RBZ has
adjusted financial statements represent the principal financial statements of the Group. Historical cost financial stated its intention to honour its commitment and has to date provided liquidity to support obligations that CABS has
statements have been presented as supplementary information to the restated financial statements. settled to the tune of USD11.3 million. The arrangements for the settlement of the OMZIL obligation are still under
discussion with the RBZ.
IAS 29 requires that the financial statements prepared in the currency of a hyperinflationary economy be stated in terms
of the measuring unit current at the balance sheet date, and that corresponding figures for previous periods be restated 2.3 Insurance and investment contracts
in the same terms. The restatement of the historical cost numbers is based on the conversion factors derived from the
consumer price index (CPI) issued by the Zimbabwe Central Statistical Office (C.S.O). We believe the CPI best represents 2.3.1 Classification of contracts
average price movements in the economy during the reporting period and have thus applied it in preparation of these Contracts under which the Group accepts significant insurance risk from another party (the policyholder), by agreeing
financial statements. The indices and conversion factors used to restate the accompanying financial statements as at 30 to compensate the policyholder or other beneficiary of a specified uncertain future event (the insured event) which
June 2021 are given below. adversely affects the policyholder, are classified as insurance contracts. Insurance risk is risk which is distinct from
financial risk. Financial risk is the risk of a possible future change in one or more of a specified interest rate, security price,
commodity price, foreign exchange rate, index of prices or rates, a credit rating or credit index or other variable, provided
Dates Indices Conversion Factors that in the case of a non-financial variable that the variable is not specific to a party to the contract.
30/06/2021 2,986.45 1.0000
Insurance risk is significant if, and only if, an insured event could cause an insurer to pay significant additional benefits
31/12/2020 2.474.51 1.2069 in any scenario, excluding scenarios that lack commercial substance. If significant additional benefits would be payable
in scenarios that have commercial substance, then significant insurance risk exists even if the insured event is extremely
30/06/2020 1,445.21 2.0664 unlikely or even if the expected present value of contingent cash flows is a small proportion of the expected present value
of all remaining contractual cash flows.
2.2 Critical accounting estimates and judgements

A contract that is classified as an insurance contract remains an insurance contract, until all rights and obligations
The preparation of financial statements requires management to make judgements, estimates and assumptions that
are extinguished or expire. Contracts under which the transfer of insurance risk to the Group from the policyholder
affect the application of accounting policies and reported amounts of assets, liabilities, income, and expenses. Actual
is not significant are classified as investment contracts. Contracts with a discretionary participating feature are those
results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis.
under which the policyholder holds a contractual right to receive additional payments as a supplement to guaranteed
Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods
minimum payments. These additional payments, the amount or timing of which is at the Group’s discretion, represent a
affected.
significant portion of the total contractual payments and are contractually based on:
(i) the performance of a specified pool of contracts or a specified type of contract, and
Critical accounting estimates are those which involve the most complex or subjective judgement or assessments. The
(ii) realised and/or unrealised investment returns on a specified pool of assets held by the Group.
areas of the Group’s business that typically require such estimates are life insurance contract provisions, determination
of the fair value for financial assets and liabilities, investment properties and provisions. For the half year ended 30 June
Contracts with a discretionary participating feature may be classified either as insurance contracts or investment
2021, the determination of functional currency has been a key judgement area.
contracts. In the case of the Group all contracts with a discretionary participating feature are accounted for in the same
manner as insurance contracts.
2.2.1 Functional currency
The financial statements are prepared in compliance with measurement and recognition principles of International
2.3.2 Insurance contract liabilities and investment contracts with a discretionary participating feature
Financial Reporting Standards (IFRSs). IFRSs comprise interpretations adopted by the IASB, which includes standards
Insurance contract provisions are measured using the Financial Soundness Valuation (FSV) method as set out in the
adopted by the IASB and interpretations developed by the International Financial Reporting Interpretations Committee
guidelines issued by the Actuarial Society of South Africa (ASSA) in Standard of Actuarial Practice (SAP) 104 (version 8).
(IFRIC) or by the former Standing Interpretations Committee (SIC).
Under this guideline, provisions are valued using realistic expectations of future experience, with prescribed margins for
prudence and deferral of profit emergence.
In February 2019, the Government of Zimbabwe issued Statutory Instrument 33 (SI 33) of 2019, which, based on our legal
interpretation, for accounting and other purposes, prescribed parity between the US Dollar and local currency as at and
Provisions for investment contracts with a discretionary participating feature are also computed using FSV method.
up to the effective date of 22 February 2019, and prescribed the way certain balances in the financial statements should
Surplus allocated to policyholders but not yet distributed (i.e. bonus smoothing reserve) related to these contracts is
have been treated because of the recognition of the RTGS Dollar as currency in Zimbabwe. It is the Group’s view that the
included as a carrying value of liabilities.
prescribed parity in value between local currency and the USD did not accurately reflect underlying market economic
conditions for 2018.
Investment options and guaranteed payments are computed on the prospective deposit method, which produces
reserves equal to the present value of future benefit payments.
For the 2019 financial year, SI 33 also applied up to 22 February 2019. The exchange differences that arose on translating
foreign currency denominated assets and liabilities on the date of change in the Group’s functional currency were
Derivatives embedded in an insurance contract are not separated and measured at fair value if the embedded derivative
accounted for through the Currency conversion reserve. In February 2019, the interbank market was introduced, for
itself qualifies for recognition as an insurance contract. The entire contract is measured as described above.
trading of currencies, for which the starting exchange rate was ZWL2.5 to USD1. Exchange rate closed the year, at 31
December 2019, at ZWL16.774 to USD1.
The Group performs liability adequacy testing on its insurance liabilities (including investment contract liabilities with
discretionary participating features) to ensure that the carrying amount of its liabilities is sufficient in view of estimated
In March 2020, responding to financial vulnerabilities caused by COVID-19, the RBZ suspended the managed floating
future cash flows. When performing the liability adequacy test, the Group discounts all contractual cash flows and
exchange rate system and adopted a fixed exchange rate system at the rate of ZWL25 to USD1.
compares this amount to the carrying value of the liability. Where a shortfall is identified, an additional provision is made.
Notes to the Financial Statements
For the Six Months Ended 30 June 2021(cont’d)
The provision estimation techniques and assumptions are periodically reviewed, with any changes in estimates being 3. Segment information - Life General Banking Asset Holding Co Consolidation
reflected in profit or loss as they occur. Inflation adjusted Assurance Insurance & Lending Management & Other Adjustments Total
ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm
Whilst the directors consider that the gross insurance contract provisions and the related reinsurance recovery are
fairly recognised on the basis of the information currently available to them, the ultimate liability will vary as a result of A1 Statement of profit or loss -
subsequent information and events, and may result in significant adjustments to the amount provided. The Group applies segment information for the
shadow accounting in relation to certain insurance contract provisions, which are supported by owner occupied properties, six months ended 30 June 2021

on which unrealised gains and losses are recognised within other comprehensive income. Revenue
Gross earned premiums 2,948.2 1,200.1 - - - (222.7) 3,925.6
2.3.3 Investment contract liabilities Outward reinsurance (43.7) (379.7) - - - - (423.4)
Liabilities for investment contracts without a discretionary participating feature are classified as financial liabilities at fair Net earned premiums 2,904.5 820.4 - - - (222.7) 3,502.2
_246
value through profit or loss and are measured at fair value. For unit linked and market linked contracts, this is calculated as
Investment income (non-banking) 26,852.4 385.8 - 144.0 1,919.8 (285.9) 29,016.1
the account balance, which is the value of the units allocated to the policyholder, based on the bid price value of the assets Banking interest and similar income - - 2,276.5 - - (2.2) 2,274.3
in the underlying fund (adjusted for tax). For other linked contracts, the fair value of the liability is determined by reference Fee income, commissions, and
to the fair value of the underlying assets, and is in accordance with the FSV method, except that negative dollar reserves income from service contracts 135.9 - 2,675.7 444.1 207.7 (500.2) 2,963.2
arising from the capitalisation of future margins are not permitted. The fair value of the liability is subject to the “deposit Other income 64.2 27.0 300.0 4.4 466.9 (428.0) 434.5
Total revenue 29,957.0 1,233.2 5,252.2 592.5 2,594.4 (1,439.0) 38,190.3
floor” such that the liability established cannot be less than the amount repayable on demand.
Expenses
2.4 Investment property Claims and benefits (including
Investment property is real estate held to earn rentals and/or for capital appreciation. It does not include owner occupied change in insurance contract
provisions) (18,775.1) (493.0) - - - 52.5 (19,215.6)
property.
Reinsurance recoveries 38.5 97.0 - - - - 135.5
Net claims incurred (18,736.6) (396.0) - - - 52.5 (19,080.1)
Investment properties are initially measured at cost and subsequently at fair value through profit and loss. Recorded
values are determined by internal professional valuers who perform valuations quarterly. The recorded values are tested by Change in provision for
comparing with values determined by independent external valuers for a sample of properties accounting for at least 65% investment contract liabilities (785.2) - - - - - (785.2)
Fees, commissions, and
of the total value of the property portfolio, or for at least the top twenty-five buildings by value and as well as properties other acquisition costs (278.1) (92.1) (847.4) (2.1) (12.9) 311.5 (921.1)
being valued for the first time. Banking interest payable and
similar expenses - - (170.9) - - 49.2 (121.7)
An investment property shall be derecognised (eliminated from the statement of financial position) on disposal or when Impairment charges - - (771.9) - - - (771.9)
the investment property is permanently withdrawn from use and no future economic benefits are expected from disposal. Other operating and
administration expenses (892.0) (389.2) (1,638.2) (336.6) (423.4) 610.9 (3,068.5)
Net monetary adjustments (2,682.2) (128.1) (714.2) (56.7) (1,460.0) 2,750.1 (2,291.1)
The valuation methodology adopted is dependent upon the nature of the property. The direct income capitalisation
method was applied on all income generating properties. This method was applied on industrial, retail and commercial Profit before tax 6,582.9 227.8 1,109.6 197.1 698.1 2,335.2 11,150.7
properties and offices. The direct comparison method was applied to land holdings and residential properties. Property Income tax expense/(credit) (90.9) (60.4) (6.8) (49.4) (179.0) - (386.5)
Profit for the period 6,492.0 167.4 1,102.8 147.7 519.1 2,335.2 10,764.2
developments are valued in a similar manner to income generating assets except where information about future net

income cannot be determined with sufficient confidence, in which case fair value is estimated with reference to the value A2 Statement of profit or loss -
of the land, and the cost of construction to date. segment information for the
six months ended 30 June 2020
Surpluses and deficits arising from changes in fair value are reflected in profit or loss.
Revenue
Gross earned premiums 1,630.4 873.9 - - - (251.9) 2,252.4
For properties reclassified during the period from property and equipment to investment properties up to the date of Outward reinsurance (30.8) (458.3) - - - - (489.1)
change any revaluation gain arising is initially recognised in profit or loss to the extent of previously charged impairment Net earned premiums 1,599.6 415.6 - - - (251.9) 1,763.3
losses. Any residual excess is taken to the revaluation reserve.
Investment income (non-banking) 26,846.4 599.5 - 270.5 2,788.9 (963.0) 29,542.3
Banking interest and similar income - - 1,199.6 - - (2.1) 1,197.5
Revaluation deficits are recognised in the revaluation reserve to the extent of previously recognised gains and any residual Fee income, commissions, and
deficit is accounted for in profit or loss. income from service contracts 65.1 - 1,169.6 331.0 147.1 (19.6) 1,693.2
Other income 1,404.8 339.5 2,259.9 75.8 14.4 (185.1) 3,909.3
Investment properties that are reclassified to owner occupied property should be revalued at date of transfer, with Total revenue 29,915.9 1,354.6 4,629.1 677.3 2,950.4 (1,421.7) 38,105.6

any difference recognised in profit or loss. Its fair value at date of reclassification becomes its fair value for subsequent Expenses
accounting. Claims and benefits (including
change in insurance contract
2.5 Financial instruments provisions) (22,734.6) (368.7) - - - 5.6 (23,097.7)
Recognition and derecognition Reinsurance recoveries 0.8 113.7 - - - - 114.5
Net claims incurred (22,733.8) (255.0) - - - 5.6 (22,983.2)
-
Initial recognition of financial assets Change in provision for
Under IFRS 9: Financial Instruments or ‘IFRS 9’ , there are three measurement classifications as follows: investment contract liabilities (1,100.1) - - - - - (1,100.1)
- Amortised cost; Fees, commission, and
other acquisition costs (122.5) (27.7) (538.5) (5.2) (11.8) 108.7 (597.0)
- Fair Value through Other Comprehensive Income (FVOCI) which may include debt or equity instruments or;
Banking interest payable and
- Fair Value through Profit and Loss (FVTPL). similar expenses - - (316.4) - - 15.1 (301.3)
Impairment charges - - (309.2) - - - (309.2)
The classification of financial assets for the Group is based on whether the financial assets are equity instruments, debt Other operating and
instruments held or derivative assets and this is in line with the requirements of IFRS 9. Equity instruments held for trading administration expenses (390.1) (188.9) (1,024.1) (280.6) (245.1) 236.6 (1,892.2)
Net monetary adjustment (1,036.1) (628.4) (1,208.8) (60.8) (1,228.3) 2,178.6 (1,983.8)
purposes and derivative assets are mandatorily categorised as financial assets at FVTPL. The classification and measurement
of debt instruments is dependent on the business model in which the financial asset is managed and its contractual cash Profit before tax 4,533.3 254.6 1,232.1 330.7 1,465.2 1,122.9 8,938.8
flow characteristics. Derivatives embedded in contracts where the host is a financial asset in the scope of the standard are Income tax expense/(credit) 219.6 (55.2) (18.6) (65.7) (111.9) - (31.8)
not accounted for separately. Instead, the hybrid financial instrument as a whole is assessed for classification. Profit for the period 4,752.9 199.4 1,213.5 265.0 1,353.3 1,122.9 8,907.0
A debt instrument is classified as a financial asset at amortised cost if it meets both of the following conditions (and is not 3. Segment information - Life General Banking Asset Holding Co Consolidation
designated as at FVTPL): Historical Cost Assurance Insurance & Lending Management & Other Adjustments Total
- it is held within a business model whose objective is to hold assets to collect contractual cash flows; and ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm
- its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the B1 Statement of profit or loss -
segment information for the
principal amount outstanding.
six months ended 30 June 2021

A debt instrument is measured at FVOCI if it meets both of the following conditions (and is not designated as at FVTPL): Revenue
- it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling Gross earned premiums 2,778.0 1,125.0 - - - (209.1) 3,693.9
financial assets and; Outward reinsurance (20.9) (375.5) - - - - (396.4)
- its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the Net earned premiums 2,757.1 749.5 - - - (209.1) 3,297.5
principal amount outstanding.
Investment income (non-banking) 38,879.6 537.3 146.9 2,395.0 (270.8) 41,688.0
Banking interest and similar income - - 2,157.7 - - (2.1) 2,155.6
On initial recognition of an equity instrument that is not held for trading, the instrument may be irrevocably designated at Fee income, commissions, and
FVOCI. In such an instance, changes in the equity instrument’s fair value are recorded in other comprehensive income (OCI). income from service contracts 119.9 - 2,539.6 433.4 171.2 (473.5) 2,790.6
This election is made on an investment-by-investment basis. Other income 79.6 33.7 303.2 10.5 401.8 (405.4) 423.4
Total revenue 41,836.2 1,320.5 5,000.5 590.8 2,968.0 (1,360.9) 50,355.1
All debt instrument financial assets not classified as measured at amortised cost or FVOCI are measured at FVTPL. On initial
Expenses
recognition, the Group may irrevocably designate a debt instrument financial asset that otherwise meets the requirements
Claims and benefits (including
to be measured at amortised cost or at FVOCI or at FVTPL, if doing so, eliminates or significantly reduces an accounting change in insurance contract
mismatch that would otherwise arise. Transaction costs that are directly attributable to the acquisition of financial assets provisions) (29,000.8) (449.2) - - - 51.1 (29,398.9)
are expensed in profit or loss for financial assets initially classified at FVTPL. For financial assets not classified at FVTPL, Reinsurance recoveries 36.0 88.1 - - - - 124.1
transaction costs are added to or deducted from the fair value at initial recognition. Net claims incurred (28,964.8) (361.1) - - - 51.1 (29,274.8)

Initial recognition of financial liabilities Change in provision for investment
contract liabilities (1,877.6) - - - - - (1,877.6)
On initial recognition, financial liabilities are measured at fair value plus, in the case of financial liabilities not classified at Fees, commissions, and
FVTPL, transaction costs that are incremental and directly attributable to the issue of the financial liability. Transaction costs other acquisition costs (270.6) (89.2) (776.7) (2.9) (10.9) 286.5 (863.8)
of financial liabilities carried at FVTPL are expensed in profit or loss. Banking interest payable and
similar expenses - - (155.6) - - 44.1 (111.5)
Subsequent measurement of financial assets Impairment charges - - (771.9) - - - (771.9)
The following accounting policies apply to the subsequent measurement of financial assets. Other operating and
administration expenses (703.9) (349.7) (1,567.0) (313.8) (259.6) 417.5 (2,776.5)

Profit before tax 10,019.3 520.5 1,729.3 274.1 2,697.5 (561.7) 14,679.0
These assets are subsequently measured at fair value. Net gains and losses, including Income tax expense/(credit) (88.3) (45.5) (6.5) (51.3) (172.6) - (364.2)
Financial assets at FVTPL Profit for the period 9,931.0 475.0 1,722.8 222.8 2,524.9 (561.7) 14,314.8
any interest or dividend income, are recognised in profit or loss.

B2 Statement of profit or loss -
These assets are subsequently measured at amortised cost using the effective segment information for the
Financial assets at amortised interest method. The amortised cost is reduced by impairment losses. Interest six months ended 30 June 2020
cost income, foreign exchange gains and losses and impairment are recognised in profit
Revenue
or loss. Any gain or loss on derecognition is recognised in profit or loss.
Gross earned premiums 472.1 263.2 - - - (77.5) 657.8
Outward reinsurance (8.5) (114.9) - - - - (123.4)
These assets are subsequently measured at fair value. Interest income calculated
Net earned premiums 463.6 148.3 - - - (77.5) 534.4
using the effective interest method, foreign exchange gains and losses and
Debt investments at FVOCI impairment are recognised in profit or loss. Other net gains and losses are Investment income (non-banking) 29,979.6 274.7 - 116.1 1,297.2 (443.9) 31,223.7
recognised in OCI. On derecognition, gains and losses accumulated in OCI are Banking interes, and similar income - - 363.4 - - (0.6) 362.8
Fee income, commissions and
reclassified to profit or loss. income from service contracts 22.5 456.5 90.9 37.4 (109.2) 498.1
Other income 660.7 126.0 1,085.5 21.6 5.3 (18.1) 1,881.0
These assets are subsequently measured at fair value. Dividends are recognised as
Total revenue 31,126.4 549.0 1,905.4 228.6 1,339.9 (649.3) 34,500.0
income in profit or loss unless the dividend clearly represents a recovery of part of
Equity investments at FVOCI
the cost of the investment. Other net gains and losses are recognised in OCI and are Expenses
never reclassified to profit or loss. Claims and benefits (including
change in insurance contract
provisions) (24,493.1) (105.6) - - - 1.5 (24,597.2)
Subsequent to initial recognition all financial liabilities at FVOCI and FVTPL are measured at fair value, except that any Reinsurance recoveries 0.3 32.1 - - - - 32.4
instrument that does not have a quoted market price in an active market and whose fair value cannot be reliably measured Net claims incurred (24,492.8) (73.5) - - - 1.5 (24,564.8)
is stated at cost. Fair value movements attributable to changes in the credit risk of a financial liability designated at FVTPL
is recorded in other comprehensive income and not recycled to profit or loss. The balance of the fair value movement is Change in provision for investment
recorded in profit or loss. Other financial liabilities are measured at amortised cost. contract liabilities (1,804.7) - - - - - (1,804.7)
Fees, commissions, and
other acquisition costs (55.7) (8.6) (163.4) (1.6) (3.6) 56.5 (176.4)
Derecognition of financial assets
Banking interest payable and
The Group derecognises a financial asset when the contractual rights to the cashflows from the financial asset expire, or it similar expenses - - (90.4) - - 4.2 (86.2)
transfers those rights in a transaction in which substantially all of the risks and rewards of ownership of the financial asset Credit losses and impairment charges - - (149.6) - - - (149.6)
are transferred or in which the Group neither transfers nor retains substantially all of the risks and rewards of ownership and Other operating and
it does not retain control of the financial asset. The Group enters into transactions whereby it transfers assets recognised in administration expenses (139.8) (59.9) (293.5) (72.8) (62.3) 116.6 (511.7)
its statement of financial position, but retains either all or substantially all of the risks and rewards of the transferred assets.
Profit before tax 4,633.4 407.0 1,208.5 154.2 1,274.0 (470.5) 7,206.6
In these cases, the transferred assets are not derecognised.
Income tax expense/(credit) 79.6 1.0 (28.0) (13.9) (30.7) (14.5) (6.5)
Profit for the period 4,713.0 408.0 1,180.5 140.3 1,243.3 (485.0) 7,200.1
Derecognition of financial liabilities
The Group derecognises a financial liability when the contractual obligations are discharged, or cancelled or expire. The
Group also derecognises the financial liability when its terms are modified and the cashflows of the modified liability
are substantially different, in which case a new financial liability based on the new terms is recognised at fair value. On
derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid
(including any non-cash assets transferred or liabilities assumed) is recognised in profit or loss
3. Segment information - Life General Banking Asset Holding Co Consolidation Inflation Adjusted Historical Cost
Inflation Adjusted Assurance Insurance & Lending Management & Other Adjustments Total Group Group Group Group
ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm 30-Jun-21 30-Jun-20 30-Jun-21 30-Jun-20
C1 Statement of financial position -
ZWLm ZWLm ZWLm ZWLm
segment information
as at 30 June 2021 4 Gross earned premiums

Assets Gross premiums
Investment property 25,067.5 34.6 1,298.3 - 25.6 - 26,426.0 Single 2.3 14.5 2.1 4.3
Property and equipment 1,872.6 234.0 4,410.1 142.1 197.2 (227.0) 6,629.0 Recurring 100.4 56.8 90.2 15.5
Intangible assets - - 631.9 2.2 2.0 - 636.1 Individual business 102.7 71.3 92.3 19.8
Deferred acquisition costs - 43.9 - - - - 43.9
Reinsurer contracts - 302.3 - - - - 302.3 Single 820.9 448.0 773.6 145.7
_246
Investments and securities 69,413.3 1,353.8 2,212.5 283.6 8,314.1 (5,051.8) 76,525.5 Recurring 2,116.0 859.2 2,065.9 283.6
Deferred tax assets - - 2.2 8.4 10.9 - 21.5 Group business 2,936.9 1,307.2 2,839.5 429.3
Current tax receivable 24.5 - - - - - 24.5
General insurance 886.0 873.9 762.1 208.7
Loans and advances - - 16,215.4 - - - 16,215.4
Total gross premiums 3,925.6 2,252.4 3,693.9 657.8
Other assets 1,039.4 145.2 2,677.0 208.9 7,428.3 (4.0) 11,494.8
Cash and cash equivalents 993.2 474.1 4,620.2 88.9 102.6 (3,295.3) 2,983.7
Total assets 98,410.5 2,587.9 32,067.6 734.1 16,080.7 (8,578.1) 141,302.7 Comprising
Insurance contracts 373.0 392.8 342.1 107.2
Liabilities Investment contracts with discretionary
Insurance contract liabilities 74,531.8 840.9 - - - - 75,372.7 participating features 2,666.6 985.7 2,589.7 341.9
Investment contract liabilities 5,195.5 - - - - - 5,195.5 General insurance 886.0 873.9 762.1 208.7
Provisions 135.6 - 403.1 10.5 12.1 - 561.3 Total gross earned premiums 3,925.6 2,252.4 3,693.9 657.8
Deferred tax liabilities 288.6 73.0 201.3 - 141.0 - 703.9
Current tax payables - 34.7 - 21.0 23.1 - 78.8 5 Investment income (non-banking)
Amounts due to group companies 179.7 14.7 76.9 1.3 7,715.1 - 7,987.7
Amounts owed to bank depositors - - 18,053.2 - - (3,965.5) 14,087.7
Dividend income
Credit lines - - 3,814.0 - - - 3,814.0
Financial assets at fair value through profit or loss 688.1 273.6 577.6 93.0
Other liabilities 222.0 192.0 1,678.2 165.9 106.3 (139.2) 2,225.2
Total liabilities 80,553.2 1,155.3 24,226.7 198.7 7,997.6 (4,104.7) 110,026.8 Interest income
Cash and cash equivalents 66.6 36.2 62.7 10.8
Net assets 17,857.3 1,432.6 7,840.9 535.4 8,083.1 (4,473.4) 31,275.9 Net rental income
Shareholders’ equity Investment property 455.3 321.7 430.1 113.0
Share capital and premium 1,439.3 0.5 1,948.9 437.0 - (3,825.7) - Fair value gains and losses
Revaluation reserve - - 1,528.6 - - - 1,528.6 Investment property (1,358.4) 6,019.3 3,412.8 11,054.7
Share option reserve 181.5 63.1 277.7 70.1 953.4 (70.1) 1,475.7 Financial assets at fair value through profit or loss 29,164.5 22,891.5 37,204.8 19,952.2
Retained earnings 16,236.5 1,369.0 4,085.7 28.3 7,129.7 (1,076.6) 27,772.6 27,806.1 28,910.8 40,617.6 31,006.9
Equity holders of the parent 17,857.3 1,432.6 7,840.9 535.4 8,083.1 (4,972.4) 30,776.9
Total investment returns included in income statement 29,016.1 29,542.3 41,688.0 31,223.7
Non-controlling interests - - - - - 499.0 499.0
Total equity 17,857.3 1,432.6 7,840.9 535.4 8,083.1 (4,473.4) 31,275.9

6 Banking interest and similar income and expense
C2 Statement of financial position -
segment information Interest and similar income
as at 31 December 2020 Investments 425.2 138.9 402.7 42.1
Loans and advances 1,849.1 1,058.6 1,752.9 320.7
Assets Total interest and similar income 2,274.3 1,197.5 2,155.6 362.8
Investment property 25,943.1 42.5 1,551.4 - 29.6 - 27,566.6
Property and equipment 1,848.7 108.0 4,092.7 109.6 313.2 (116.5) 6,355.7
Interest Expense:
Intangible assets - - 645.2 7.4 2.0 - 654.6
Credit lines (112.8) (183.5) (103.4) (53.6)
Reinsurer contracts - 262.0 - - - - 262.0 Money market deposits (7.8) (112.4) (7.2) (30.2)
Investments and securities 40,350.2 872.5 4,161.1 192.6 6,879.5 (4,923.7) 47,532.2 Savings deposits (1.1) (5.4) (0.9) (2.4)
Deferred tax assets - - 1.8 - - 1.8 Total interest expense (121.7) (301.3) (111.5) (86.2)
Current tax receivable 48.3 22.6 - 2.1 - - 73.0
Loans and advances - - 8,568.1 - - (12.5) 8,555.6 Net interest income 2,152.6 896.2 2,044.1 276.6
Other assets 741.8 500.1 5,061.9 159.7 8,180.9 - 14,644.4
Cash and cash equivalents 1,990.2 325.0 6,627.1 20.6 168.6 (217.0) 8,914.5 7 Fee income, commissions, and income
Total assets 70,922.3 2,163.2 30,707.5 493.8 15,573.8 (5,269.7) 114,590.9 from service contracts

Liabilities Banking operations:
Insurance contract liabilities 56,753.3 621.4 - - - - 57,374.7
Commissions 1,125.7 659.2 1,060.1 187.1
Investment contract liabilities 3,952.5 - - - - - 3,952.5
Service fees 838.5 383.9 789.7 117.1
Provisions 123.6 40.7 279.5 56.2 59.1 - 559.1
Deferred tax liabilities 263.3 37.1 239.3 3.1 103.8 (24.1) 622.5 Administration fees 852.4 539.8 802.7 161.7
Current tax payables - - 0.8 - 2.0 - 2.8 Total fee income and commission from
Amounts due to group companies 322.5 4.5 14.6 (1.2) 8,466.9 - 8,807.3 banking operations 2,816.6 1,582.9 2,652.5 465.9
Amounts owed to bank depositors - - 16,016.2 - - (281.8) 15,734.4
Credit lines - - 3,835.6 - - (29.2) 3,806.4 Long term business 48.5 18.1 45.7 8.6
Other liabilities 191.7 438.3 1,984.6 112.0 1,032.4 (868.8) 2,890.2 Asset management business 98.1 92.2 92.4 23.6
Total liabilities 61,606.9 1,142.0 22,370.6 170.1 9,664.2 (1,203.9) 93,749.9 2,963.2 1,693.2 2,790.6 498.1
8. Claims and benefits
Net assets 9,315.4 1,021.2 8,336.9 323.7 5,909.6 (4,065.8) 20,841.0
Shareholders’ equity
Claims and benefits (including change
Share capital and premium 1,439.3 0.5 1,914.2 428.0 - (3,782.0) -
in insurance contract provisions):
Revaluation reserve - - 1,857.9 - - - 1,857.9
Share option reserve 181.6 63.1 277.7 70.1 953.4 (70.2) 1,475.7 Increase in insurance contract provisions 17,356.8 20,653.9 27,273.4 23,610.4
Retained earnings 7,694.5 957.6 4,287.1 (174.4) 4,956.2 (611.5) 17,109.5 Gross claims expenses
Equity holders of the parent 9,315.4 1,021.2 8,336.9 323.7 5,909.6 (4,463.7) 20,443.1 (refer to analysis in note 8.1 below) 1,873.3 1,381.3 1,865.2 405.9
Non-controlling interests - - - - - 397.9 397.9 Shadow accounting to revaluation reserve
Total equity 9,315.4 1,021.2 8,336.9 323.7 5,909.6 (4,065.8) 20,841.0 (14.5) 1,062.5 260.3 580.9
19,215.6 23,097.7 29,398.9 24,597.2
8.1 Analysis of claims expenses
3. Segment information - Life General Banking Asset Holding Co Consolidation
Historical cost Assurance Insurance & Lending Management & Other Adjustments Total
ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm ZWLm Individual business 67.5 40.7 63.6 11.3
D1 Statement of financial position - Death and disability benefits 22.5 3.5 20.6 1.0
segment information Maturity benefits 5.2 11.2 4.3 3.6
as at 30 June 2021 Surrenders 39.8 26.0 38.7 6.7

Assets Group business 1,413.2 971.9 1,410.7 290.5
Investment property 25,067.5 34.6 1,298.3 - 25.6 - 26,426.0 Death and disability benefits 203.5 53.1 203.2 15.1
Property and equipment 1,597.1 35.8 3,108.5 46.7 80.3 (54.7) 4,813.7
Pension commutations, maturities, and
withdrawal benefits 732.6 594.1 731.3 180.1
Reinsurer contracts - 281.2 - - - - 281.2 Annuities 321.1 219.5 320.5 62.5
Investments and securities 69,413.3 1,353.8 2,212.5 283.6 4,884.8 (1,622.5) 76,525.5 Surrenders 156.0 105.2 155.7 32.8
Deferred tax assets - - 1.8 7.9 0.2 - 9.9 General insurance 392.6 368.7 390.9 104.1
Current tax receivable 24.5 - - - - - 24.5 Total claims and benefits 1,873.3 1,381.3 1,865.2 405.9
Loans and advances - - 16,215.4 - - - 16,215.4
Other assets 1,039.4 145.2 2,225.2 208.9 7,428.3 (4.0) 11,043.0 Comprising:
Cash and cash equivalents 993.2 474.1 4,620.2 88.9 102.6 (3,295.3) 2,983.7 Insurance contracts 271.0 54.7 269.8 16.1
Total assets 98,135.0 2,364.8 29,874.8 636.2 12,522.1 (4,976.5) 138,556.4 Investment contracts with discretionary
participating features 1,209.7 957.9 1,204.5 285.7
Insurance contract liabilities 74,531.8 793.9 - - - - 75,325.7 General insurance 392.6 368.7 390.9 104.1
Investment contract liabilities 5,195.5 - - - - - 5,195.5
Total claims and benefits payable 1,873.3 1,381.3 1,865.2 405.9
Provisions 135.6 - 403.1 10.5 12.1 - 561.3

Deferred tax liabilities 288.8 28.6 201.2 - 60.8 - 579.4
Current tax payables - 34.7 - 21.0 23.1 - 78.8 9. Other operating and administration expenses
Amounts due to group companies 179.7 14.7 76.9 1.3 7,715.1 - 7,987.7
Amounts owed to bank depositors - - 18,053.2 - - (3,965.5) 14,087.7 Operating expenses
Credit lines - - 3,814.0 - - - 3,814.0 Administrative expenses 451.0 276.5 429.6 99.1
Other liabilities 222.0 192.0 733.3 165.0 106.3 (139.2) 1,279.4 Office space costs 90.7 50.8 85.5 18.4
Total liabilities 80,553.4 1,063.9 23,281.7 197.8 7,917.4 (4,104.7) 108,909.5 Fees and levies 9.9 0.8 9.2 0.3
Donations 33.4 35.2 30.7 14.9
Net assets 17,581.6 1,300.9 6,593.1 438.4 4,604.7 (871.8) 29,646.9 Actuarial and consultancy fees 79.6 65.5 75.6 20.6
Shareholders’ equity Advertising and marketing 201.2 31.6 188.8 10.1
Share capital and premium 30.1 - 67.5 62.8 - (160.4) - Software licensing 163.0 78.7 153.8 23.2
Non-distributable reserve 29.8 2.1 1.5 0.4 21.4 (0.3) 54.9 Depreciation and amortisation 219.0 307.7 91.0 22.9
Revaluation reserve - - 2,503.3 - - - 2,503.3 1,247.8 846.8 1,064.2 209.5
Share option reserve 3.8 1.3 5.8 1.6 62.6 (3.4) 71.7
Retained earnings 17,517.9 1,297.5 4,015.0 373.6 4,520.7 (1,244.1)
26,480.6
Auditors’ remuneration 88.5 38.4 88.5 18.6
Equity holders of the parent 17,581.6 1,300.9 6,593.1 438.4 4,604.7 (1,408.2)
29,110.5
Non-controlling interests - - - - - 536.4
536.4
Staff costs
Total equity 17,581.6 1,300.9 6,593.1 438.4 4,604.7 (871.8)
29,646.9
Wages and salaries 1,092.0 703.6 1,029.2 196.8
Retirement obligations 24.2 16.9 22.6 6.4
D2 Statement of financial position -
Social security costs 24.6 18.2 22.6 4.9
segment information
as at 31 December 2020 Bonus and incentive remuneration 223.7 33.7 205.4 16.3
Other staff costs 263.0 172.8 261.4 46.0
Assets 1,627.5 945.2 1,541.2 270.4
Investment property 21,496.0 35.2 1,285.6 - 24.4 - 22,841.2 Other 104.7 61.8 82.6 13.2
Property and equipment 1,464.3 32.2 2,708.1 42.3 53.0 (64.3) 4,235.6 3,068.5 1,892.2 2,776.5 511.7
Deferred acquisition costs - 17.2 - - - - 17.2 Inflation Adjusted Historical Cost
Reinsurer contracts - 171.8 - - - - 171.8 Group Group Group Group
Investments and securities 33,433.5 722.9 3,447.8 159.6 2,999.9 (1,379.4) 39,384.3 30-Jun-21 31-Dec-20 30-Jun-21 31-Dec-20
Deferred tax assets - - 1.7 5.3 - - 7.0
Current tax receivable 40.1 18.7 - 1.7 - - 60.5 ZWLm ZWLm ZWLm ZWLm
Loans and advances - - 7,099.4 - - (10.4) 7,089.0 10. Investment property
Other assets 614.6 391.4 2,890.2 117.2 6,756.3 - 10,769.7
Cash and cash equivalents 1,649.0 269.3 5,491.1 17.1 139.7 (179.8) 7,386.4 Carrying amount at beginning of period 27,566.6 23,942.1 22,841.2 4,422.3
Total assets 58,697.5 1,658.7 23,016.7 343.6 9,973.6 (1,633.9) 92,056.2 Additions 217.8 53.0 172.0 37.5
Disposal - (497.4) - (324.3)
Liabilities Transfers in - 49.6 - 4.7
Insurance contract liabilities 47,024.7 406.3 - - - - 47,431.0 (Loss)/gain from fair value adjustments (1,358.4) 4,019.3 3,412.8 18,701.0
Investment contract liabilities 3,275.0 - - - - - 3,275.0 Carrying amount at end of period 26,426.0 27,566.6 26,426.0 22,841.2
Provisions 102.4 33.7 231.6 46.7 48.9 - 463.3
Deferred tax liabilities 218.2 13.5 191.6 - 21.1 (7.1) 437.3 Comprising:
Current tax payables - - 0.7 - 1.6 - 2.3
Leasehold property 265.4 276.8 265.4 252.0
Amounts due to group companies 267.3 3.8 11.9 (1.0) 7,015.6 - 7,297.6
Amounts owed to bank depositors - - 13,270.7 - - (233.5) 13,037.2 Freehold property 26,160.6 27,289.8 26,160.6 22,562.2
Credit lines - - 3,178.1 - - (24.2) 3,153.9 26,426.0 27,566.6 26,426.0 22,814.2
Other liabilities 158.9 363.2 1,089.1 92.4 855.3 (787.4) 1,771.5
Total liabilities 51,046.5 820.5 17,973.7 138.1 7,942.5 (1,052.2) 76,869.1 The fair value of freehold property leased to
third parties under operating leases 22,292.6 25,704.8 22,292.6 21,243.6
Net assets 7,651.0 838.2 5,043.0 205.5 2,031.1 (581.7) 15,187.1
Shareholders’ equity Rental income from investment property 893.5 1,412.1 842.1 824.1
Share capital and premium 30.1 - 57.0 54.4 - (141.5) - Direct operating expenses arising from rented-
Non-distributable reserve 29.8 2.1 1.5 0.4 21.4 (0.3) 54.9 out investment property (438.2) (685.0) (412.0) (403.2)
Revaluation reserve - - 2,358.3 - - - 2,358.3 455.3 727.1 430.1 420.9
Share option reserve 3.8 1.3 5.8 1.6 62.6 (3.4) 71.7
Retained earnings 7,587.3 834.8 2,620.4 149.1 1,947.1 (779.2) 12,359.5
Equity holders of the parent 7,651.0 838.2 5,043.0 205.5 2,031.1 (924.4) 14,844.4 The carrying amount of investment property as well as owner occupied property is the fair value of property as determined
Non-controlling interests - - - - - 342.7 342.7 quarterly by internal professional valuers, having an appropriate recognised professional qualification and recent
Total equity 7,651.0 838.2 5,043.0 205.5 2,031.1 (581.7) 15,187.1 experience in the location and category of the property being valued. The recorded values are tested by comparing with
values determined by independent external valuers for a sample of properties accounting for at least 65% of the total
value of the property portfolio, or for at least the top twenty-five buildings by value.
Key assumptions applied in the valuation process include: investment linked insurance funds and funds which operate like unit trusts which are managed on a fair value basis.
- Rental yields, are benchmarked to USD rentals due to the difficulty in making forward looking assumptions in These funds back investment contracts with discretionary participating features and investment contracts accounted for
ZWL, on account of the current hyperinflationary environment. in terms of IFRS 9.
- The underlying property valuation has been performed in USD as property valuation standards require valuations
to be performed in a stable measuring unit. The Group has not consolidated the investment in MBD as management concurred that the investment in MBD is not
- USD valuation is converted to ZWL at the prevailing interbank rate. material. Nedbank Zimbabwe has not been equity accounted, but has been fair valued as per IFRS 9. The Group is not
represented on the Nedbank Zimbabwe Board, does not have significant transactions with Nedbank Zimbabwe and as
The Property Market has remained subdued characterised by thin asset market transactions. In view of this, we have such, the directors do not believe that OMZIL is in a position to exercise significant influence over Nedbank Zimbabwe,
maintained the previous cap rates used during USD era. notwithstanding the size of the shareholding.
The Group’s current lease arrangements, which are entered into on an arm’s length basis and which are comparable to Inflation adjusted Historical cost
those for similar properties in the same location, are taken into account. Rentals are reviewed regularly in response to Group Group Group Group
_246
inflation. 30-Jun-21 31-Dec-20 30-Jun-21 31-Dec-20
ZWLm ZWLm ZWLm ZWLm
Fair Value Hierarchy 11.5 Treasury bills maturity analysis
The fair value of the Group’s properties are categorised into Level 3 of the fair value hierarchy through their use of
unobservable units. The following table shows the valuation techniques used in the determination of the fair values for On demand to 3 months 68.4 1,497.4 68.4 1,240.7
3 months to 12 months 1,025.7 1,149.8 1,025.7 952.7
investment properties, as well as the unobservable inputs used in the valuation models.
1 year to five years 45.6 10.4 45.6 8.6
Total 1,139.7 2,657.6 1,139.7 2,202.0
Inter-relationship between
unobservable inputs and key fair 11.6 Sensitivity Analysis - Listed equities
Type of property Key unobservable inputs value measurement Value 30 June 2021 +/- 20% +/- 50% +/- 75% stock
reported value movement movement movement
Commercial, retail and Office The estimated fair value would ZWL20,679.8m ZWLm ZWLm ZWLm ZWLm
industrial properties - Capitalisation rates: 7.5% to 10% increase if:
- Market rentals per m2: USD7.00 -net rental income increased Equities - after increase 65,240.7 78,288.8 97,861.1 114,171.2
Owner occupied properties to USD12.00 -capitalisation rates decreased. Equities - after decrease 65,240.7 52,192.6 32,620.4 16,310.2
- Vacancy rates: 0.00% to 80.00% -vacancies decreased Increase/Decrease in fair value movement - 13,048.1 32,620.4 48,930.5
Valuation approach: Income Retail Impact on profit and Net Asset Value - 3,001.1 7,502.7 11,254.0
capitalisation - Capitalisation rates: 6% to 11.5% The estimated fair value would
- Market rentals per m2: USD8.00 decrease if the unobservable The Group has significant holdings in equities, consequently any movement in the market index will have a significant
to USD15.00 inputs changed the other way. impact on reported profits for the half year.
- Vacancy rates: 0.00% to 10.00%
Industrial Movement of fair value of listed shares
- Capitalisation rates: 9% to 10.7% As at 31 July 2021, the value of the Zimbabwe Stock Exchange (ZSE) all share index had increased to 159% from 135%
- Market rentals per m2: USD0.75 as at 30 June 2021. This subsequent increase in ZSE price resulted in the Group’s listed equities increasing by ZWL8.6bn
to USD4.00
as at 31 July 2021, while profits for that period have been positively impacted by ZWL2.5bn on a historical cost basis. The
- Vacancy rates: 0.00% to 5.00%
Group’s subsidiaries remain well capitalised.
Residential Rentals per month: USD750 to The estimated fair value would ZWL20.1m
USD1,700 increase if prices for comparable Inflation adjusted Historical cost
Valuation approach: Direct properties increased. Group Group Group Group
comparison/Market approach 30-Jun-21 31-Dec-20 30-Jun-21 31-Dec-20
ZWLm ZWLm ZWLm ZWLm
Near vacant properties Land value per m2: USD46 The estimated fair value would ZWL5,726.1m
increase if prices for comparable 12 Loans and advances
Valuation approach: Direct properties increased.
comparison/Market approach Concentration
Housing 884.8 517.4 884.8 428.7
10.1 Sensitivity Analysis - Exchange rates Unsecured personal loans 1,532.0 759.0 1,532.0 628.9
At Valuation Translated 50% 75% Commercial and industrial 14,807.3 7,950.7 14,807.3 6,587.8
30 June 2021 @ 85.42340 depreciation depreciation Gross loans and advances 17,224.1 9,227.1 17,224.1 7,645.4
USDm ZWLm ZWLm ZWLm Less provision for impairment (1,008.7) (671.5) (1,008.7) (556.4)
Net loans and advances 16,215.4 8,555.6 16,215.4 7,089.0
Investment property 309.4 26,426.0 39,639.0 46,245.5
Fair value gains 28.1 3,412.8 16,625.8 23,232.3 Maturity analysis
Impact on profit/(loss) and net asset value - 307.2 1,496.3 2,090.9 On demand to 3 months 2,382.7 1,551.8 2,382.7 1,285.8
3 months to 12 months 4,879.1 2,559.4 4,879.1 2,120.7
1 year to 5 years 9,556.9 5,011.7 9,556.9 4,152.6
The US dollar value of the property portfolio grew by 10% from USD279.3 million to USD309.4 million, attributable to
Over 5 years 405.4 104.2 405.4 86.3
improved rental yields. On a Zimbabwe dollar comparative basis the property portfolio grew by 16% from ZWL22,841.2 Gross and loans advances 17,224.1 9,227.1 17,224.1 7,645.4
million to ZWL26,426.0 million attributable to improved rental yields and currency depreciation. The table below shows
a sensitivity analysis of the property values. Non performing loans 42.9 38.1 42.9 31.5

10.2 Sensitivity Analysis - Valuation inputs Analysis of past due but not impaired
30 to 60 days past due 242.2 147.2 242.2 122.0
Impact on 61 to 90 days past due 551.7 936.5 551.7 776.0
profit/(loss) 793.9 1,083.7 793.9 898.0
At Valuation Translated and net 12.1 Sectoral analysis of loans and advances
30 June 2021 @ 85.42340 asset value
USDm ZWLm ZWLm The business monitors concentrations of credit risk on loans and advances by sector. An analysis of concentrations of
credit risk from loans and advances at the balance sheet date is shown below:
An increase of 10% in market rentals per m2
would increase the fair value by: 31.1 2,655.9 239.0 Inflation adjusted Historical cost
A decrease of 10% in market rentals per m2 would Group Group Group Group
(decrease) the fair value by: (31.1) (2,655.9) (239.0) 30-Jun-21 31-Dec-20 30-Jun-21 31-Dec-20
ZWLm ZWLm ZWLm ZWLm
An increase of 10% in land value per m2 would increase
the fair value by: 6.7 572.2 51.5 Sector
A decrease of 10% in land value per m2 would Agriculture 6,844.7 4,570.8 6,844.7 3,802.2
(decrease) the fair value by: (6.7) (572.2) (51.5) Construction and property 291.8 174.7 291.8 144.8
Energy and minerals 688.8 977.8 688.8 838.4
An increase of 1% in capitalisation rates would Light and heavy industry 3,280.8 10.9 3,280.8 9.0
(decrease) the fair value by: (19.7) (1,682.4) (151.4) Physical persons 2,621.1 2,000.6 2,621.1 1,614.6
A decrease of 1% in capitalisation rates State and state enterprises 721.5 545.5 721.5 452.0
would increase the fair value by: 24.9 2,126.5 191.4 Trade and services 2,775.4 946.8 2,775.4 784.4
Total gross loans 17,224.1 9,227.1 17,224.1 7,645.4
Group Group Group Group 13 Other assets
30-Jun-21 31-Dec-20 30-Jun-21 31-Dec-20
ZWLm ZWLm ZWLm ZWLm Accrued interest and rent 47.8 597.5 47.8 495.1
11 Investments and securities Agent debtors and prepayments 1,488.6 1,701.9 1,221.2 882.5
Banking settlement and other clearing accounts. 819.0 985.3 819.0 816.4
11.1 Analysis of investments RBZ Legacy Debt (see note 13.1 below) 8,365.2 9,826.8 8,365.2 8,142.3
Trade debtors 53.4 193.1 53.4 160.0
Equity securities - listed 65,240.7 36,080.7 65,240.7 29,895.8 Other 720.8 1,339.8 536.4 273.4
11,494.8 14,644.4 11,043.0 10,769.7
- unlisted 8,325.4 6,190.6 8,325.4 5,129.4
13.1 RBZ Legacy Debt
Total Equities 73,566.1 42,271.3 73,566.1 35,025.2

Unit trust investments - 8.4 - 7.0
Principal Amount 100.7 122.5 101.0 101.5
Treasury bills 1,139.7 2,657.6 1,139.7 2,202.0 Fair value gain 8,525.4 9,909.2 8,525.1 8,210.6
Deposits and money market securities 1,819.7 2,594.9 1,819.7 2,150.1 Gross amount owing 8,626.1 10,031.7 8,626.1 8,312.1
76,525.5 47,532.2 76,525.5 39,384.3 Provision (260.9) (204.9) (260.9) (169.8)
11.2 Spread of equity securities by sector 8,365.2 9,826.8 8,365.2 8,142.3

Commodities 15,019.7 10,886.3 15,019.7 9,020.2 On the 24th of June 2019, the Government issued Statutory Instrument 142 (SI 142) which was followed up by the RBZ’s
Communications 23,851.4 1,891.9 23,851.4 1,567.6 Exchange Control Directive RU/102 of 2019 which directed authorised dealers to transfer to the RBZ, Zimbabwe Dollar
Consumer 10,186.0 11,310.9 10,186.0 9,372.0 balances at an exchange rate of ZWL1: USD1 in relation to foreign currency legacy debts to be registered with the RBZ.
Financial 1,418.4 12,107.7 1,418.4 10,032.2
Property 20,354.4 565.4 20,354.4 468.5 Legacy Debts registration process 30-Jun-21 31-Dec-20
Manufacturing 1,722.9 3,616.2 1,722.9 2,996.3 Application Application
Mining 1,013.3 1,892.9 1,013.3 1,568.4 outcome outcome
73,566.1 42,271.3 73,566.1 35,025.2 Approved pending Approved pending
USDm USDm USDm USDm
11.3 Movements of investment and securities
External lines of credit 26.4 - 26.4 -
Opening balance 47,532.2 33,170.2 39,384.3 6,126.8 Amounts owing to related parties 84.3 7.3 83.8 5.1
Fair value movements through profit or loss 29,164.5 13,287.7 37,204.8 29,668.8 Amounts owing to 3rd parties 1.3 4.0 - 3.9
Additions 3,678.5 8,784.9 2,109.9 5,125.6 Amounts utilised to date (11.3) - (8.7) -
Disposals (2,278.8) (2,417.6) (871.9) (445.3) 100.7 11.3 101.5 9.0
Maturities (1,570.9) (5,293.0) (1,301.6) (1,091.6)
Closing balances 76,525.5 47,532.2 76,525.5 39,384.3 The Group made applications relating to amounts incurred in USD between 2012 and 2018, when the functional
currency was USD and prior to promulgation of SI 33 of February 2019, to providers of offshore lines of credit as well as
11.4 Investment in unlisted equities above 20% equity shareholding related parties within the wider Old Mutual Limited Group.
30-Jun-21 31-Dec-20
Inflation Historical CABS initially registered for USD30.3 million owing mostly to loan repayments for offshore lines of credit and foreign
Value Adjusted Cost suppliers of goods and services, during 2019, but only USD26.4 million was finally approved. During 2020, OMZIL also
Investee % holding ZWLm ZWLm ZWLm got approval for USD83.8 million in respect of unremitted dividends (USD32.1 million), payables for the indigenisation
Takura Fund II (Limited Partner) “B Shares” transaction (USD50 million) and management fees (USD1.7 million). During 2021, CABS got additional approval for
(held by Shareholders and OMLAC Main Fund) 40% 2,037.6 1,960.3 1,624.3 USD1.3 million whilst an additional USD0.5 million in respect of management fees was also approved for other group
Nedbank Zimbabwe (held by Shareholders) 20% 508.6 71.7 59.4 subsidiaries.
Lake Harvest Aquaculture
(held by Shareholders and OMLAC Main Fund) 26% 3.5 4.3 3.6 Upon transferring local funds for the registration of legacy debts/blocked funds a legitimate expectation to receive a
Lobels Holdings Limited (held by OMLAC Main Fund) 49% 1,016.0 1,160.4 961.5 cashflow to allow for settlement of the registered obligation was created and a financial instrument was recognised on
Manica Board and Doors (MBD) the Group’s statement of financial position. This financial instrument has been fair valued on the assumption that a right
(held by OMLAC Main Fund) 56% 484.5 129.5 107.3 to acquire an amount equivalent to the debt registered at a future date now exists. The carrying value of the financial
Kupinga Renewable Energy instrument reflects management’s assessment of the present value of the expected net cashflows to be received under
(held by OMLAC Main Fund) 40% 149.2 179.8 149.0 this arrangement.
Closefin (held by OMLAC Main Fund) 21% 803.5 209.5 173.6
The RBZ has stated its intention to honour its commitment and has provided liquidity to support obligations that CABS
Plaza Bakery (held by OMLAC Main Fund) 49% 6.4 7.6 6.3
Zimcampus preference shares has settled to the tune of USD11.3 million since the debts were registered. Discussions with RBZ are underway to finalise
(held by OMLAC Main Fund) 31% 446.6 411.4 340.9 settlement modalities for the debts owed by OMZIL which amount to USD84.3 million.
Solgas ordinary shares (held by OMLAC Main Fund) 49% 4.7 5.6 4.6
Richaw Solar Tech ordinary shares The legacy debt financial instrument is subject to expected credit losses as required by IFRS 9 and has consequently
been put into the Stage 1 of the ECL model as the credit rating. Stage 1 has been considered as appropriate due to
(held by OMLAC Main Fund) 49% 3.3 4.0 3.3
indications by Government of the intention to support the orderly discharge of the obligation.
Harava Solar Park (held by OMLAC Main Fund) 27% 2.5 3.0 2.5
Takura Fund III (Limited Partner) “D Shares” The table below shows the impact on profit and net assets at various levels of provisioning the legacy debt instrument.
(held by Shareholders and OMLAC Main Fund) 74% 1,651.3 519.8 430.7
Tenpill (held by Shareholders and OMLAC Main Fund) 39% 1,120.4 729.2 604.2 13.2 Carrying Additional Additional Additional
8,238.1 5,396.1 4,471.2 amount provision provision provision
30 June 2021 @10% @20% @50%
Underlying private equity valuations are performed in USD. The absence of an active market in ZWL impacts on price ZWLm ZWLm ZWLm ZWLm
discovery mechanisms. There is also inherent difficulty in making forward looking valuation assumptions in ZWL on
account of present inflationary conditions. In addition, the multicurrency environment has meant that many investee Legacy debt 8,365.2 7,763.5 6,900.9 4,313.1
companies generate cashflows in more than one currency with pricing referenced to a USD value. This makes underlying Impact on profit and net assets - (601.7) (1,464.3) (4,052.1)
valuations in USD appropriate. The valuations are converted to ZWL at the prevailing auction exchange rate. The Group
has accounted for unlisted investments of this nature on the basis of IFRS 9, as Financial Assets at Fair Value through The directors believe that the risk of non-realisation of cashflows under the arrangement is remote due to the fact that
Profit or Loss, notwithstanding the percentage holding in each entity. The above investments which originate from the RBZ has supported repayments under the legacy debt registered for CABS as they have fallen due, with indications
the investments of policyholder funds, with the exception of the investment in Nedbank Zimbabwe, are invested into having been provided that support will continue to be provided for the remaining amounts in CABS and OMZIL.
Inflation adjusted Historical cost

Group Group Group Group Socio-political: Tranquillity prevailed in the socio-political area, with no impacts on business resilience, and on the safety
30-Jun-21 31-Dec-20 30-Jun-21 31-Dec-20 and security of staff members. The build-up towards the 2023 elections may heighten political tensions resulting in
ZWLm ZWLm ZWLm ZWLm security concerns for the business and staff, with knock-on effects on business resilience. The effects of the COVID-19
pandemic will continue for unforeseeable future, with prolonged impacts on staff health (physical and mental) and on
14 Insurance contract liabilities business resilience.

Outstanding claims 793.8 50.4 793.8 41.9 Climate Change Risk: Normal to above normal rainfall was experienced during the 2020/21 farming season, leading to
Future policyholders’ benefits good agricultural forecasts. This is expected to have a positive impact on the performance of the Group’s agricultural
(see analysis of movement in provision below) 74,578.9 57,324.3 74,531.9 47,389.1
exposures in CABS, OMFIN and OMICO. There have been, however, frost claims against OMICO, given the very low
75,372.7 57,374.7 75,325.7 47,431.0
temperatures experienced since June 2021. The full extent of these claims was being determined at the time of this
14.1 Future policyholders’ benefits
report. Going forward, the Group recognises climate change as a key risk for financial services companies, which will
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Movement in provision for insurance contracts continue to be managed.
Balance at beginning of year 57,324.3 45,713.6 47,389.1 8,294.7
Inflows Mitigating Actions: The Group continues to maintain a cautiously optimistic outlook for the remainder of the year 2021.
Premium income 3,502.2 4,935.8 3,297.5 2,524.9 Management continues to defend key elements of the business and ensuring value preservation for customers and
Investment income 16,949.5 10,992.2 27,049.3 39,725.7 shareholders. All businesses are focusing on offering more customer-led solutions. Engagements with the authorities
Fee and other income 98.6 408.5 94.8 67.0 continue to be done in conjunction with industry bodies on the new and emerging laws and regulations that negatively
Outflows impact customers and the business, to influence positive policy changes.
Claims and policy benefits (1,737.8) (2,880.3) (1,741.0) (1,591.7)
Operating expenses (848.9) (2,257.1) (845.3) (1,175.8) Market Risk
-
Taxation Description & Impact: Risks relating to adverse changes to the balance sheet or future earnings resulting, directly and
Current tax (14.1) (153.6) (13.4) (107.5) indirectly, from fluctuations in the market prices of financial instruments. The Group is exposed to equity & property
Deferred tax (6.1) 963.1 (4.3) (18.5) volatility risk, foreign exchange rate risk and interest rate risk.
Transfer to operating profit (688.8) (397.9) (694.8) (329.7)
Balance at end of period 74,578.9 57,324.3 74,531.9 47,389.1 Equity Volatility Risk: The Group’s strategy to maintain a high level of listed equity investments for shareholder funds
held mainly through the life and the holding company, with such investments constituting over 50% of the shareholder
15 Investment contract liabilities asset portfolio, was sustained during the period under review. This was in line with the Board approved asset allocations,

for value preservation, in an inflationary environment. Despite the inherent fluctuations on the ZSE, the equity market
Liabilities at fair value through profit or loss 5,195.5 3,952.5 5,195.5 3,275.0
experienced a bullish performance in the first half of 2021, outperforming inflation levels. The Group is cognisant of the

Movement in liabilities fair valued residual market risk, as the unrealised gains are not guaranteed.
through profit or loss
Balance at beginning of year 3,952.5 3,200.8 3,275.0 591.2 Foreign Exchange Rate Risk: The Group’s exposure to changes in the exchange rates or currency risk is due to a foreign
New contributions received 13.5 46.8 12.5 38.8 currency net open position (NOP) and the projected trend of exchange rates. Given that the Group has an overall long
Withdrawals (25.4) (15.7) (24.2) (13.0) (positive) NOP, appreciation of the local currency against the foreign currencies will result in revaluation losses, however,
Fair value movements 1,254.9 720.6 1,932.2 2,658.0 potential impacts are expected to remain within appetite over the assessment period.
Balance at end of period 5,195.5 3,952.5 5,195.5 3,275.0
Interest Rate Risk: The Group’s exposure to interest rate risk is mainly through the lending businesses, CABS and Old
16 Amounts due by or (to) group companies Mutual Finance and money market investments for shareholder funds through OMIG. The pressure on interest margins
remained as inflation sustained high levels, notwithstanding the improving year-on-year trend. This was exacerbated
Old Mutual Limited (South Africa) and its by increased pressure for an upward review of interest rates on time deposits which may result in further negative real
subsidiaries outside Zimbabwe 7,987.7 8,807.3 7,987.7 7,297.6 returns for CABS. RBZ provided clarity on the application of S.I. 65 A on payment of interest on deposits, this will only
7,987.7 8,807.3 7,987.7 7,297.6 apply to savings and fixed term deposits, in line with international practices. This reduced the interest margin risk for
CABS, as its deposit structure is skewed towards demand/transactional deposits.
The amounts due by or to group companies above are unsecured and are payable on demand.
Mitigating Actions: Increasing exposure to alternative investments which also preserve value, and where possible
Inflation adjusted Historical cost increasing exposure to forex denominated assets, to diversify equity concentration risk. Increases of interest rates are
Group Group Group Group being done in line with market trends and RBZ guidelines.
30-Jun-21 31-Dec-20 30-Jun-21 31-Dec-20
ZWLm ZWLm ZWLm ZWLm
Liquidity Risk
17 Amounts owed to bank depositors
Money market deposits 1,387.4 260.9 1,387.4 216.2 Description & Impact: The risk that available liquid assets will be insufficient to meet changing market and business
Term deposits - 0.1 - 0.1 conditions, liabilities, funding of asset purchases, or an increase in client demands for cash. The Group’s strategic
Savings deposits 12,700.3 15,473.4 12,700.3 12,820.9 shareholder asset allocation which is biased towards real asset classes, namely equity stock and property investments,
14,087.7 15,734.4 14,087.7 13,037.2 while prudent for value preservation, may negatively impact the liquidity position of the businesses as equity and
Maturity analysis property markets are inherently illiquid.
On demand to 3 months 12,701.3 15,591.1 12,701.3 12,918.5
3 months to a year 472.6 9.3 472.6 7.7 While the Group remained able to meet its short-term obligations, there were increasing inflation-induced pressures
1 year to 5 year 889.2 50.8 889.2 42.1 from funding of capital expenditures. Overall market liquidity was largely subdued during the half-year period. The
Over 5 years 24.6 83.2 24.6 68.9 monetary authorities continued to pursue a mainly contractionary monetary policy, and there were delays in funding of
14,087.7 15,734.4 14,087.7 13,037.2 the Foreign Currency Auction during the period. The RBZ advised of changes in operating framework for Open Market
Operations (‘OMO’) activities effective 04 June 2021 and this impacts CABS liquidity management strategies as any
In the Group’s banking business the Group receives cash from bank depositors. The depositors receive interest on the excess liquidity beyond the prescribed limit is converted into Non-negotiable Certificates of Deposits (‘NNCDs’) at 0%
amounts owed depending on the value of the amount borrowed and the terms of the deposit. interest rate maturing in various tranches over a 30-day period. CABS had a total of ZWL89 million in NNCDs as of 30
June 2021. This framework has resulted in tighter liquidity conditions in the market and for CABS, to avoid funds being
30-Jun-21 31-Dec-20 swept in NNCDs. Consequently, there were breaches of internal limits of the Liquid Asset Ratio and Liquidity Coverage
ZWLm % ZWLm % Ratio at CABS in June which are being addressed. The Loans to Deposits Ratio was also in breach of the limit. Statutory
Concentration - Inflation adjusted
Instrument 127 of 2021 is likely to impact foreign currency liquidity due to increased demand for foreign currency from
Financial institutions 2,249.5 16.0 1,356.3 8.6
the Auction, further worsening market liquidity challenges.
Companies 8,581.3 60.9 11,884.2 75.5
Individuals 3,256.9 23.1 2,493.9 15.9
14,087.7 100.0 15,734.4 100.0 Mitigating Actions: Adaptable business units (BU) and Group–wide daily liquidity and cash flow management strategies,
which include, inter alia, cash flow forecasting and prioritisation of expenses to cover the essentials, reducing the hard
Concentration - Historical cost currency mismatch through growing the export book, introduction of USD products, purchasing USD on the interbank
Financial institutions 2,249.5 16.0 1,123.8 8.6 market and auction market to assist in expunging the legacy debt amounts, generating liquidity from operations as well
Companies 8,581.3 60.9 9,847.0 75.5 as selling shares. Liquidity contingency arrangements are in place and are reviewed annually for the OMZIL BUs. There
Individuals 3,256.9 23.1 2,066.4 15.9 is a liquidity framework embedment project for non-bank BUs which will see the introduction of liquidity metrics such
14,087.7 100.0 13,037.2 100.0 as the liquidity coverage ratio for the insurance businesses. Stress testing covering liquidity scenarios is conducted within
These are on-demand deposits. the Group. CABS will be lending on a more selective basis and will be mobilising deposits to create more liquid assets to
regularise the ratios in breach of internal limits.
18 Currency Sensitivity Analysis
Legal & Regulatory Compliance Risk
The table below is a sensitivity analysis of the effect of using different exchange rates to convert foreign currency balances
to local reporting currency. The scenarios presented compare the impact of using closing rate at 1:85.42340; Depreciated Description & Impact: The risk of not applying or conforming to the laws, or breaching laws, regulations, or directives,
at 50% and 75%. resulting in fines, sanctions, reputational damage and/or financial loss. The regulatory environment that the Group operates
in is dynamic and exposure to legal and regulatory compliance risk was high as there were several new legislative and
Group Group Group Group regulatory requirements which included various Exchange Control Regulations, Monetary Policy Statements, Regulatory
Foreign currency denominated Assets/Liabilities USDm ZWLm ZWLm ZWLm Directives, Circulars and Statutory Instruments. The Group maintained its zero tolerance for deliberate regulatory non-
Translated @ 50% 75%
compliance. Material non-compliance issues which have remained open for an extended period, are tracked and
30 June 2021 1:85.42340 depreciation depreciation
remedial actions monitored. These include: IPEC Directive on Governance & Risk Management breaches, prescribed
Assets
asset ratio breaches, breaches of investments thresholds, Net Open Position limit breaches, Europay, Mastercard and Visa
Investments and securities 85.3 7,282.3 10,923.5 12,744.1
Loans and advances 75.6 6,454.2 9,681.3 11,294.9 (EMV) technology compliance gaps and unregistered pension schemes and Group Life Assurance schemes.
Other assets 105.4 8,998.3 13,497.5 15,747.1
Cash and cash equivalents 53.2 4,541.8 6,812.8 7,948.3 Legal Risk: There were no new significant litigation cases against the Group during the review period, on the inverse,
Total assets 319.5 27,276.6 40,915.1 47,734.4 there was positive development as some loss of value cases against the Group’s companies were dismissed with costs by
the courts and others were withdrawn by the appellants.
Liabilities
Borrowed funds 45.2 3,858.9 5,788.3 6,753.0 Mitigating Actions: Regulators continued to be engaged on the compliance gaps and progress in implementing the
Amounts owed to group companies 92.7 7,914.1 11,871.1 13,849.7 remedial actions. Impact and readiness assessments are conducted for new and impending laws, regulations, and
Amounts owed to bank depositors 76.2 6,505.4 9,758.2 11,384.5 directives, to improve compliance levels.
Other liabilities 4.3 367.1 550.7 642.4
Policyholder liabilities 69.5 5,933.4 8,900.2 10,383.5 Operational Risk
Total liabilities 287.9 24,578.9 36,868.5 43,013.1
Description & Impact: Risk of loss due to an inadequate or inefficient workforce, failure of processes or systems and/or
Net assets 31.6 2,697.7 4,046.6 4,721.3 the occurrence of external events.

The Group and its subsidiaries remain solvent and sufficiently capitalised at the different exchange rate sensitivities. Business Resilience: Power cuts and network connectivity challenges manifested in operational disruptions especially
for the remote working arrangements. The COVID-19 pandemic continued to impact continuity of business operations,
19 Risk Management in instances where some branches or service centres were forced to temporarily close as some staff tested positive or
encountered positive cases.
In the half-year to 30 June 2021, the main risks faced by the OMZIL Group were external risk characterised by government
policy changes and environmental risk, the COVID-19 pandemic, with impacts on operations and strategy implementation. Frauds: Exposure to fraud risk remained inherently high in the period under review. Fraud cases were investigated by the
While there was an improvement in the year-on-year inflation rate the exchange rates were on a deteriorating trend, with Group Forensic Services department and appropriate action taken against the culprits.
an adverse effect on business expenses. Intense competition from market players continued to exert pressure on the
market shares of some of the Group’s businesses. There was, however, recovery of market shares in other business units. Control Environment: Some audit key performance indicators (KPIs) such as on-time remediation, overdue audit issues
and resolved audit issues (cure rate) were outside target ranges as of 30 June 2021 and deteriorated from the previously
Cybercrime and cybersecurity risk exposure is inherently high due to the increasing and evolving sophistication of attacks reported positions. There were some long outstanding reconciling issues in some business units, although the trend has
externally as well as the increased exposure due to expanded remote connectives as a result of remote working. The been improving.
Group continued to enforce controls to proactively detect cyberattacks and respond timely to prevent extensive damage
to the entire estate. Mitigating Actions: There is continued implementation of the Control Environment Improvement Program (CEIP) which
is aligned to the COSO Internal Control Framework, for process improvement. Oversight of projects delivery is being
The Group was mostly compliant with legal and regulatory requirements, with remedial actions being implemented for provided by the Group Projects Steering Committee, where issues impacting project delivery and their resolutions are
exceptions, and progress updates provided to regulators. discussed. The Group availed facilities to qualifying staff for back-up power in response to the increased power cuts
experienced. Proactive fraud detection capabilities are being enhanced. The Interllinx Fraud Detection system was
The Group maintains a cautiously optimistic outlook for the remainder of 2021 given the uncertainties in the operating implemented in OMICO and is targeted for roll-out in one more business unit by end of 2021. Arrangements are also
environment and will continue to respond with sound risk management practices to evolving macro-economic and underway in the banking business to implement a fraud monitoring solution.
environmental developments to defend and grow customer and shareholder values.
Strategic Risk
External Risk
Description & Impact: The risk that discretionary decisions are made that adversely affect future earnings and/or the
Description & Impact: The risks arising from the external environment, e.g., macroeconomic developments, environmental sustainability of the business.
changes, climate changes, competitor activities, government policy changes and/or actions including socio-political
events adversely impacting on the business. Capital Allocation: The Return on Net Asset Value (‘RoNAV’) for period to 30 June 2021 was 128%, attributable to the
growth in current year earnings driven by core profits and investment returns. The Group’s value preservation strategy
Macro-economic Risk: In the first half of 2021, there was a relative improvement in the year-on-year inflation rate. The therefore remains appropriate.
outlook of the risk is negative and likely to deteriorate in the short term due to a deteriorating ZWL/USD exchange rate
and the adverse effects of S.I. 127 as this policy was interpreted negatively by some players in the economy. The impact Innovation: New products and services continued to be pursued, mainly under the digital initiatives. The MyOldMutual
of this was an increase in both ZWL and USD prices. Platform was launched in the first half of 2021, allowing clients to do banking, insurance, and investment transactions on
one platform. Process automation continued for the various Group business units, with improved efficiencies in customer
Emerging laws, regulations, and directives: As reported in the Annual Results Publication for 2020, pending legislations servicing.
include Insurance and Pensions Legislation, which will affect OMLAC (separation of pension and insurance businesses)
and OMICO (financial disclosures and contributions to the fund) and the Cybersecurity & Data Protection Bill will impact Business Model/Concentration: There was a soft launch to staff of the OMLAC Funeral Services product on 1 July 2021,
the way personal sensitive information is collected, processed, and stored by OMZIL Business Units. The risk remains of and subsequent to that, the business was launched to the market, starting with operations in Bulawayo. Other BUs are
new laws and regulatory requirements being passed with immediate effect, with negative effects on compliance levels still pursuing the strategy of growing the USD business. OMSEC migrated from the Custodial based model that had
and with the risk that the requirements are unfavourable for customers and for the business. An example of this over previously impacted its competitiveness to a Broker-based model.
the review period was S.I. 127, which had immediate effect and the Group companies had to engage their respective
regulators and the RBZ for approval to offer foreign currency products and services, where this approval had not been Execution: There were delays of some strategic initiatives such as the replacement of the OMICO I90 system, and CABS
obtained, nor was it explicit. Internet banking upgrade. The growth of the USD business also remains low.
Competition: There is a continuing need to defend market leading positions and recover lost market shares. OMLAC was Mitigating Actions: Changing the insurance business model is underway as well as introduction of automatic premium
ranked 5th in the life assurance industry as of 31 March 2021, a deterioration from being a market leader. This was due escalating products. Digital initiatives continue to be rolled out across the Group.
to a change in the computation of the market shares by IPEC to account separately for corporate premiums and retail
premiums. In terms of market ranking by deposits, CABS was ranked 4th out of 12 banks that have published financials Conduct Risk
as of 31 December 2020 (preliminary position), an improvement from 5th as of 30 June 2020. OMICO regained the
number 1 position as of 31 March 2021, from 3rd, in terms of Gross Written Premiums (GWP) as per the IPEC report for Description & Impact: The risk of failing; to treat customers fairly, to offer solutions that meet their needs and expectations
Quarter 1 2021. and to communicate with various stakeholders adequately and timeously on developments affecting them.
Significant risk continues to emanate from the industry-wide issues relating to legacy issues (2008/9), which includes Information Technology Risk
possible enforcement of the Commission of Inquiry recommendations on compensation for loss of value. Added to this
are the loss of value issues emanating from the 2019 currency reforms. There has been continued pressure on social media Description & Impact: Risks of loss due to an inadequate or inefficient information security, failure of systems and/or
for compensation of pensioners for the legacy loss of value. The Group may continue to receive customer complaints related processes. This includes the risk of failure to protect the confidentiality, integrity, or availability of information
around the legacy loss of value issues across various channels. Customer complaints on the current Guaranteed Fund technology assets, whether electronic or otherwise, from unauthorised access, use, disclosure, disruption, modification, or
product continued to be addressed by management. IPEC issued a Treating Customers Framework (‘TCF’) which was destruction.
effective 1 June 2021, highlighting increased focus on market conduct issues by the regulator.
Technology/System Risk: System availability remained above the 98% target and was 100% as of 30 June 2021. The core
Mitigating Actions: The Group Legal team continues to assist the Group companies on the resolution of any outstanding Banking system availability and performance was above the Service Level Agreement (SLA) requirement.
or emerging loss of value cases. Revisions of the Guaranteed Fund product are continuing to ensure it performs
according to customer expectations. The Contact Centre automation to assist with complaints handling is in progress. Technical debt, the accumulated costs and long-term consequences of obsolete technology: Projects are underway
Work is underway to ensure the Group fully embeds the Market Conduct Framework in processes, mainly through the to replace the I90 system in the general insurance business, and to implement the cloud-based Silica (in the asset
_246
development and tracking of the market conduct metrics. Impact & Readiness Assessments of the IPEC TCF guideline management business), as part of de-risking the business.
were conducted by OMLAC and OMICO and management actions have been put in place to address identified gaps.
There were several recurring system events at CABS, with impacts on customer, reputation, and regulatory compliance.
Insurance Risk
Information Security – Cybercrime. The risk remains high of cyberattacks especially under the current remote work
Description & Impact: The risk of adverse losses due to inadequate underwriting, pricing, reserving assumptions and/or arrangements. Cyber risk exposure was however within tolerance over the review period. The need to remain relevant
volatile claims experience materially impacting earnings and capital. For the Group, this risk is inherent in the insurance through the implementation of digital solutions presented risks relating to information and technology systems and their
businesses, that is, the life and general insurance companies. In the half-year period, exposure to the risk, as measured functionality and enablement.
by the claims ratios (non-motor and motor, for the general insurance company and the GLA and Credit Life for the
life company), was largely within appetite limits, although in Q1 of 2021, the ratios were outside target ranges due Mitigating Actions: System challenges continue to be resolved by the ICT department, in conjunction with the system
to increased claims (COVID-19 claims for the life assurance business and motor-loss claims for the general insurance vendors, where relevant. There is a cybersecurity incidence response team which meets to deliberate on cyber incidents.
company). On the whole, the impact of the risk was, therefore, considered under control despite the turbulent external There is also a cybersecurity program in place, which is continually updated and aligned to the Old Mutual Limited
environment. program. The Group has firewalls in place and progress is being made to adopt cloud solutions for the business systems.
Management Support Services Agreement, and ICT SLAs are in place. Hardware and software upgrades are being done as
Mitigating Actions: Data driven pricing models and continuous repricing to ensure claims experience is closer to target and when necessary. There is training and upskilling of ICT personnel, and there are system disaster recovery arrangements
continue to be implemented. Reserves and reinsurance arrangements are in place to mitigate any likely increases in in place.
claims.
People Risk
Credit & Counterparty Risk
Description & Impact: Risks relating to the business workforce resourcing, utilisation and their productivity, skills,
Description & Impact: The risk of non-payment or settlement of an obligation by a counterparty under the terms of a competencies, and behaviours to manage and operate the business, including engaging with customers.
loan agreement, or the change in value of a credit asset due to a deterioration in the credit quality of a counterparty.
The Non Performing Loan (NPL) ratio at CABS and the Portfolio at Risk (PAR) at OMFIN remained within target during The performance and productivity of personnel was impacted by the COVID-19 pandemic, with some employees not
the period, however, there is continuing pressure on credit risk to deteriorate, due to the persisting economic challenges being able to work from home. Staffing levels and the capacity of personnel has been insufficient in some sections. The
impacting asset quality. RBZ’s performance on the legacy debt arrangement with CABS, has been satisfactory. Group staff turnover rate remained within target during the half-year period. However, the inherent risk remained of
continued loss of key and critical skills responsible for strategy implementation to competition or the diaspora, inadequate
Mitigating Actions: The Group businesses continuously monitor the quality of credit assets, both local and foreign succession planning, inadequate staffing base, organisational culture and emerging skills gap. During the period, there
currency, with credit scoring being done at onboarding. Reviews of counterparty limits and monitoring of exposures to were losses of some critical skills to competition, and offers were made to others, which were countered by the Group.
reinsurers are conducted. The capitalisation of reinsurers is being monitored and was fully compliant for the period under
review. The Group is in the process of enhancing investment credit risk reporting through a project that is running up to Mitigating Actions: Management approved salary increases as the business sought to remain committed to the welfare
year-end. of employees. Identification of high potential and bubbling under staff continued to be done to nurture talent, and
succession plans are in place for key positions. Training and development programs continue to be rolled out to enhance
performance and productivity of staff. Retention of critical staff through pay and role size progressions is done. Wellness
programs were also introduced within the Group, to support staff during the pandemic.
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OMZIL MID YEAR 2021 FINANCIAL RESULTS FINAL From Lawrence 31AUG21

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Chief Executive Officer’s Review

Profit before tax 11,150.7 8,938.8 14,679.0 7,206.6

Group Statement of Cash Flows

Group Statement of Comprehensive Income

Transfer between reserves - regulatory impairment allowance - - - (30.8) - 30.8 - - -

Inflation adjusted Historical cost

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