Absa Group (ABG) investor relations material

Strategic and Operational Update

• 2026 is a transition year with a new operating model and leadership across three pan-African business units, with all business units to be reported on a Pan-African basis for the first time.

• Strong business fundamentals and encouraging customer trends are evident, especially in Corporate and Investment Banking and Personal and Private Banking segments.

• Growth in digitally active customers and transactional clients continues across South Africa and Africa Regions.

• The operating environment remains challenging due to global inflation, lower GDP growth expectations, and policy rate increases in South Africa and reductions in Ghana impacting regional growth and margins.

Financial Guidance and Performance Outlook

• Revenue for H1 2026 is expected to grow by low to mid-single digits, with non-interest income outpacing net interest income.

• Net customer loans and deposits are projected to grow by mid-single digits, with business banking and CIB loans growing by high single digits.

• Operating expenses will rise by low to mid-single digits, resulting in slightly negative JAWS and a higher cost-to-income ratio.

• Net interest income growth remains modest due to margin compression, especially in Africa Regions.

• Headline earnings are forecast to grow by mid to high single digits, with ROE similar to the prior year (around 14.8%) and CET1 ratio above the board target range.

Credit Quality and Earnings Outlook

• Credit impairments are expected to remain broadly flat, with improved credit loss ratios.

• PPB credit impairments to decrease, while business banking and CIB impairments will increase from a low base.

• Group CET1 ratio to finish slightly above the Board target range; dividend payout ratio to remain around 55%.