Integrated Annual Report
2020

MATERIAL RISKS

Material risks represent dynamic risks that require active management and arise from the current operating context. These differ from key risks that are specific and ongoing due to the strategy and business model of the group.

RISK 1FUNDING AND CAPITAL RISK

  • A challenging debt and capital raising environment due to market events (such as sovereign ratings downgrades and generally challenging market conditions).
  • Inappropriate deployment of capital.

LINK TO STRATEGY

1

Organic growth

2

Risk and capital management

4

Acquisitive growth

RISK2INFORMATION AND TECHNOLOGY RISKS

  • Gaps in the integrity and adequacy of IT security (including the threat of cyberattacks), which may impact management decisions or result in the failure to prevent data loss or protect stakeholder information.

LINK TO STRATEGY

3

Data, technology and analytics

RISK3UNCERTAIN REGULATORY ENVIRONMENT

  • Large volume of new or amended regulations being promulgated.
  • Potential for unintended consequences of pro-consumer regulations.

LINK TO STRATEGY

1

Organic growth

5

People

RISK4ACQUISITION RISK

  • Ability to identify, implement and integrate potential acquisitions.
  • Potential for disproportionate demands on executives’ time.

LINK TO STRATEGY

2

Risk and capital management

3

Data, technology and analytics

4

Acquisitive growth

5

People

RISK5ACQUIRING NPL PORTFOLIOS

Applicable to Transaction Capital Recoveries

  • Acquiring a sufficient number of NPL Portfolios at an acceptable price.
  • Generating sufficient yield from acquired portfolios.

LINK TO STRATEGY

1

Organic growth

2

Risk and capital management

3

Data, technology and analytics

RISK6IMPACT ON REVENUE OF DIFFICULT ECONOMIC CONDITIONS, EXACERBATED BY COVID-19

  • Diversification within market verticals and across sectors, clients and geographies.
  • Defensiveness of divisions due to deliberate positioning in relation to socioeconomic dynamics.

LINK TO STRATEGY

1

Organic growth

2

Risk and capital management

3

Data, technology and analytics

4

Acquisitive growth

5

People

RISK7ENTRY INTO SELECT INTERNATIONAL MARKETS

  • Cautious and selective approach to opportunities in international markets.

LINK TO STRATEGY

2

Risk and capital management

3

Data, technology and analytics

4

Acquisitive growth

5

People

RISK8DIVERSIFYING REVENUE STREAMS ACROSS THE MINIBUS TAXI VALUE CHAIN

Applicable to SA Taxi

  • Diversifying revenue across market segments to ensure growth over the longer term.

LINK TO STRATEGY

1

Organic growth

3

Data, technology and analytics

4

Acquisitive growth

RISK9MARKET FORCES BEYOND THE GROUP’S CONTROL IMPACTING AFFORDABILITY OF MONTHLY INSTALMENTS

Applicable to SA Taxi

  • Including changes in interest or exchange rates, fuel prices, fare increases and increases in minibus taxi prices.

LINK TO STRATEGY

1

Organic growth

RISK10ORIGINAL EQUIPMENT MANUFACTURERS (OEMs) AS SUPPLIERS OF VEHICLES AND PARTS

Applicable to SA Taxi

  • Maintain positive relations with OEMs to ensure continued supply.
  • Supply disruptions impacting availability of minibus taxis and parts, constraining sales, financing and repairs activity.

LINK TO STRATEGY

1

Organic growth