BANKSETA AR 31 AUGUST

I am delighted to report that the implemented initiatives for the 2021/22 financial year have resulted in an improvement in BANKSETA’s performance, with 72 per cent of our targets achieved against an achievement of 52 per cent in the previous financial year. Of course, it remains our ongoing goal to exceed performance targets, as the higher our achievement of these, the greater the positive impact to our beneficiaries, for whom we serve. Nevertheless, we are pleased with the progress made to recover what was the unavoidably lost because of this devastating pandemic. The achievements for 2021/22 were against a backdrop of depressed economic growth where the Gross Domestic Product (GDP) continued to lag pre pandemic levels, with economic activity being on par with the third quarter of 2017. The country’s economy was 1.8 per cent smaller than it was in the first quarter of 2020 before the pandemic hit. This weak economic performance was despite the GDP growing by 1.2 per cent in the fourth quarter of 2022, taking the annual growth rate for 2021 to 4.9 per cent. In this respect, it should be noted, however, that 2021 GDP growth was off the back of low growth in 2020, the year of the greatest impact of the pandemic. Furthermore, according to the Statistics South Africa 2022 report, the South African economy grew by 1.1 per cent in the first quarter of 2021 (January-March), translating into an annualised growth rate of 4.6 percent. This follows a revised 1.4 per cent (annualised: 5.8 per cent) rise in real GDP in the fourth quarter of 2020. The banking and alternative banking sector was hard hit with retrenchments over the past two years due to economic instability. Youth unemployment was and continues to be of major concern; as of March 2022, it was at an alarming 66.5 per cent, with about 3.4 million young people not in education, employment or training. Appointments Bringing much-needed stability to the operational leadership of the organisation has been the appointment of the Chief Executive Officer (CEO), Mr Eubert Mashabane. He has brought a wealth of experience in skills development, and the Accounting Authority looks forward to his appointment leading to even further improved operational performance and financial management in the ensuing years. Welcomed during the year was the appointment of the

Ms Nosipho ‘Mia’ Makhanya Chairperson of the Board

Company Secretary, Ms Candice Perumalsami, and as the Board, we look forward to the strengthening of the overall execution of strategic directives. Challenges Faced by the Accounting Authority In my previous report, I highlighted the importance of the separation of the Governance and Strategy Committee (GSC) from the Executive Committee (ExCo). These board committees have continued to function independently and have enhanced the governance of the organisation. The strengthening of governance structures has remained a key priority for both of my tenures as Board Chairperson. During the preceding period, an Information and Communication Technology (ICT) Steering Committee which reports to the Audit and Risk Committee(ARC) was constituted with the objective of strengthening ICT governance controls and processes. We are in the process of appointing an independent chairperson for this committee. ICT is critical for the financial services sector, therefore the constitution of this committee will assist in improving BANKSETA’s agility. The Board has tirelessly engaged with management on challenges experienced in the year under review and is confident that issues raised relating to the implementation of Board resolutions will be attended to as agreed.

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PART A: GENERAL INFORMATION | BANKSETA ANNUAL REPORT 2021/22