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MOMENTUM METROPOLITAN HOLDINGS LIMITED - Operational update for the three months ended 30 September 2021

Release Date: 23/11/2021 07:05
Code(s): MTM MML01 MML03 MML04 MMIG07 MMIG06 MMIG05 MML02 MMIG04     PDF:  
Wrap Text
Operational update for the three months ended 30 September 2021

Incorporated in the Republic of South Africa
Registration number: 2000/031756/06
JSE share code: MTM
A2X share code: MTM
NSX share code: MMT
ISIN code: ZAE000269890
(Momentum Metropolitan or the Group)

Incorporated in the Republic of South Africa
Registration number: 1904/002186/06
Company code: MMIG
(Momentum Metropolitan Life)

Operational update for the three months ended 30 September 2021

Summary of key metrics
Key metrics                                     1Q2022           1Q20211    change %
Earnings per share (cents)                        50.6             60.3        (16)%
Headline earnings per share (cents)               38.6             65.2        (41)%
Normalised headline earnings per share (cents)2   47.4             69.5        (32)%
Normalised headline earnings (R million)           711            1 042        (32)%
Operating profit (R million)3                      338              915        (63)%
Investment return (R million)                      373              127        >100%
New business volumes (PVNBP, R million)         17 247           13 425          28%
Value of new business (R million)                  157              106          48%
New business margin                               0.9%             0.8%
Diluted embedded value per share (Rand)          27.42            26.12           5%
Return on embedded value                          7.3%             6.8%
Return on equity4                                  15%              22%

1 The Momentum Mozambique LDA business was no longer classified as held for sale at 30 September 2020, following the cancellation of its sale due to
  conditions precedent not being met by the agreed deadline. When the entity no longer met the IFRS 5 requirements to be classified as held for sale, 
  the cumulative IFRS 5 impairment recognised in previous reporting periods was reversed to the income statement instead of being restated for
  30 September 2020 has been restated accordingly. This was correctly accounted for in the 30 December 2020 reporting period.
2 Normalised headline earnings adjust the JSE definition of headline earnings for the dilutive impact of finance costs related to preference shares 
  that can be converted into ordinary shares of the Group, the impact of treasury shares held by policyholder funds and the iSabelo Trust, the amortisation
  of intangible assets arising from business combinations, B-BBEE costs and the amortisation of the discount at which the iSabelo Trust acquired the 
  Momentum Metropolitan treasury shares. 
3 Operating profit represents the profits (net of tax) that are generated from the Group’s operational activities and reflects normalised headline 
  earnings excluding the investment return on shareholder funds. Comparatives are reported for the first time.
4 Return on equity expresses normalised headline earnings as a percentage of net asset value, adjusted for the items outlined in footnote 3, 
  as well as the adjusting items to determine headline earnings. Comparatives are reported for the first time.

Strong new business performance continues

The Group continued to record strong growth in new business, despite the challenging economic environment. The present value of new business premiums
(PVNBP) increased to R17.2 billion, 28% higher than the prior period. This growth was driven by an excellent performance from Momentum Metropolitan Africa,
Momentum Investments, Metropolitan Life and Metropolitan Corporate.

The Group's value of new business increased by 48% to R157 million, reflecting the strong new business volumes, an improved mix towards higher margin
products, and good expense management. This resulted in new business margins of 0.9%, up from 0.8% in the comparative period.

The Group delivered R711 million of normalised headline earnings for the quarter, 32% lower than the comparative period in F2021. This is a satisfactory
result given the significant impact of Covid-19 related mortality losses included in this quarterly result.

The 63% decline in operating profit from R915 million to R338 million was largely attributable to net mortality losses of R327 million (net of reinsurance
and tax), after taking into account the release of R1 billion of existing Covid-19 provisions. Operating profit in Momentum Investments, Metropolitan Life,
and Momentum Corporate was further impacted by negative investment variances which include the impact of changes in the real yield curve due to the increase
in expected inflation, and the impact of higher implied volatilities on equities on the quantum of investment guarantee reserves held. Momentum Corporate
and the Non-life Insurance business unit showed solid operational growth. Investment returns almost tripled and were supported by the recovery of investment
markets and fair value gains from the revaluation of the Group's investment in venture capital funds.

When we exclude the net mortality losses and fair value gains that are by nature unpredictable, the Group delivered a result within our guided range of
underlying quarterly normalised headline earnings of R800 million to R900 million.

Group embedded value per share was R27.42 on 30 September 2021. The return on embedded value per share was an annualised 7.3% for the three months to 30
September 2021, assisted by an improvement in investment markets and positive operating variances. Expense variances continued to be strongly positive
across the group.

Return on equity (ROE) has been established as one of the key performance metrics for the Group. While the net negative mortality experience which
significantly affected our life insurance operations, hurt performance during the quarter, the Group benefited from the diversification in its earnings base
and achieved an annualised ROE of 15% for the first quarter of F2022. We continue to work towards achieving a ROE of 18 to 20% by F2024 as part of our
Reinvent and Grow initiatives.

The Group remains well capitalised with a strong balance sheet. The regulatory solvency positions of all the Group's entities remain within the target
ranges. For Momentum Metropolitan Life, the Group's main life insurance entity, the Solvency Capital Requirement (SCR) coverage increased from 1.73 times as
at 30 June 2021 to 1.78 times SCR as at 30 September 2021. This is broadly in the middle of our 1.6 to 2.0 times target range for SCR cover. This
improvement over the quarter is mainly attributable to good investment performance, strengthened funding levels of discretionary participation business and
a reduction in the prescribed equity stresses, offset in part by higher-than-expected mortality claims for Momentum Life.

Consolidated Group financial performance
The normalised headline earnings of the Group declined by 32% to R711 million, and include a decline of 63% in operating profit, offset by investment return
almost tripling.
                                                                               1Q2022                              Restated5                          change %
R million                                                       Operating  Investment  Normalised      Operating  Investment  Normalised  Operating  Investment  Normalised
                                                            (loss)/profit      return    headline  profit/(loss)      return    headline     profit      return    headline
                                                                                         earnings                               earnings                           earnings
Momentum Life                                                          (3)         25          22            284          31         315    <(100)%       (19)%       (93)%
Momentum Investments                                                  173          22         195            262         (15)        247      (34)%       >100%       (21)%
Metropolitan Life                                                      63          12          75            187          17         204      (66)%       (29)%       (63)%
Momentum Corporate                                                    134          22         156             85          11          96        58%        100%         63%
Momentum Metropolitan Health                                           46           2          48             56          (3)         53      (18)%       >100%        (9)%
Non-life Insurance                                                    181          67         248            141           6         147        28%       >100%         69%
Momentum Metropolitan Africa                                          (83)         50         (33)            69          96         165    <(100)%       (48)%     <(100)%
Normalised headline earnings from operating business units            511         200         711          1 084         143       1 227      (53)%         40%       (42)%
New Initiatives                                                      (159)          1        (158)          (110)          1        (109)     (45)%          0%       (45)%
Shareholders                                                          (14)        172         158            (60)        (16)        (76)       77%       >100%       >100%
Normalised headline earnings                                          338         373         711            914         128       1 042      (63)%       >100%       (32)%

5  Normalised headline earnings for the first quarter of F2021 have been restated to reflect minor updates to the classification of the line items between operating profit 
   and investment return. Normalised headline earnings were not impacted.

Operating profit

Operating profit declined by 63% year-on-year to R338 million, largely due to net mortality losses of R327 million (net of reinsurance and tax) in the life
insurance businesses. Momentum Life and Momentum Metropolitan Africa were most severely impacted by Covid-19 related claims during the quarter and reported
operating losses for the quarter. In addition, operating profit in Momentum Investments, Metropolitan Life, and Momentum Corporate was negatively affected
by negative investment variances, resulting from yield curve movements due to the increase in market implied inflation and the impact of higher equity
volatility assumptions on investment guarantee reserves. Momentum Corporate benefitted from strong improvement in morbidity profits. Non-life insurance
benefited from excellent underlying operational growth from Guardrisk.

Investment return

Investment return improved from R127 million to R373 million year-on-year. This includes the impact from a recovery in investment markets as well as the
recognition of the net asset value of a cell recently taken over by Guardrisk. In the Shareholders segment, investment return increased significantly due to
fair value gains from the revaluation of the Group's investment in venture capital funds.

Impact of the Covid-19 pandemic on the Group

At the start of the reporting period, the third wave of the Covid-19 pandemic in South Africa was in full force reaching its peak during the reporting
period in August 2021. In anticipation of the expected elevated claims during F2022, the Group increased its provision against Covid-19 related experience
at 30 June 2021. Due to short contract boundaries, full year provisions were not established for some business lines (notably Corporate). The total
provisions available at the start of this quarter amounted to R2 029 million (net of tax). During this quarter, the provision was reduced by R1 013 million,
leaving R1 016 million to be released, the majority of which is expected to be released over the course of F2022.

The change in the specific Covid-19 provision (net of tax) is shown in the table below:

Impact of provision release                                              Normalised headline earnings

R million                                        Mortality  Morbidity  Non-life insurance claims  Terminations    Total
Provision at 30 June 2021                            1 854         71                         54            50    2 029
Release of provision                                  (962)       (18)                       (27)           (6)  (1 013)
Momentum Life                                         (459)        (9)                         -             -     (468)
Momentum Investments                                    13
Metropolitan Life                                      (87)         -                          -            (6)     (93)
Momentum Corporate                                    (390)        (9)                         -             -     (399)
Momentum Metropolitan Africa                           (39)         -                          -             -      (39)
Non-life Insurance                                       -          -                        (27)            -      (27)
Provision at 30 September 2021                         892         53                         27            44    1 016

Mortality experience

The Group's mortality experience during the quarter varied, with Metropolitan Life and Momentum Corporate seeing claims below the initial expectation, while
Momentum Life and Momentum Metropolitan Africa experienced significantly higher than expected claims. Releases of the existing Covid-19 provisions could
only partially offset the claims experience in these businesses. In Momentum Life, the total claim amount was double the comparative period, which was
already elevated during the first wave of the pandemic to more than double the pre-pandemic average. The Group's South African life insurance businesses
paid R4.6 billion in mortality claims (gross of reinsurance and tax) during the quarter. This compares to a full year average of R5.6 billion of mortality
claims before the pandemic. The number of death claims in Botswana and Namibia over the quarter were more than double the 12month average for F2021.

Against this significantly higher mortality claims experience, the Group released R975 million of existing Covid-19 provisions (net of reinsurance and tax).
Net mortality losses for the quarter, after taking positive longevity experience of R154 million into account, amounted to R327 million, driven by losses in
Momentum Life (R241 million) and Momentum Metropolitan Africa (R81 million), as outlined in the table below.

R million                             Momentum Life  Momentum Investments  Metropolitan Life  Momentum Corporate  Momentum Metropolitan Africa    Total
Mortality experience variance                  (700)                  (22)              (130)               (462)                         (129)  (1 443)
Annuity experience variance                       -                    59                 44                  42                             9      154
Change in annuity technical reserves              -                   (13)                 -                   -                             -      (13)
Covid-19 provision release                      459                     -                 87                 390                            39      975
Net mortality losses                           (241)                   24                  1                 (30)                          (81)    (327)

Business interruption insurance

During the quarter, Guardrisk Insurance released a part of the existing Covid-19 provision against additional expenses stemming from the renewal of
reinsurance related to business interruption cover. Most claims have been settled and paid by 30 September 2021, only 69 claims were outstanding with an
estimated gross value of R227 million. Many of these claims have indemnity periods of 18 months or longer and have not yet run their course.

Up to 30 September 2021, Momentum Insure had finalised 16 claims with payments amounting to R3 million made. A further 37 claims with an estimated gross
value of R37 million remain outstanding, many of which have indemnity periods which have not yet run their course.  The remaining provision is sufficient to
absorb the impact of the outstanding claims.

Aditya Birla Health Insurance (ABHI)

India suffered from a significant surge in new Covid-19 cases between April 2021 and June 2021 which resulted in Covid-19 claims in our health insurance
joint venture (ABHI) increasing substantially for this period. Our share of the excess claims during the quarter led to a decline in normalised headline
earnings of approximately R60 million. By the end of 30 September 2021, claims reduced to a third of the claims seen between April 2021 and June 2021 and
are expected to normalise to pre-pandemic levels in the third quarter of F2022.

Consolidated Group new business performance

Key metrics                     1Q2022  1Q2021  change %
Recurring premiums (R million)     953     755       26%
Single premiums (R million)     13 116  10 073       30%
PVNBP (R million)               17 247  13 425       28%
VNB (R million)                    157     106       48%
New business margin               0.9%    0.8%

The Group's PVNBP improved by 28% to R17.2 billion for the first quarter of F2022, with all businesses delivering growth. At Momentum Life, lower protection
new business was offset by good growth in long-term savings new business. Momentum Investments delivered strong growth in both annuities and Momentum
Wealth. Metropolitan Life continued its recent strong growth trend in protection new business, which increased by 57%. Momentum Corporate saw strong growth
in recurring premium new business on group risk and FundsAtWork products, and good growth also in single premium new business. Momentum Metropolitan Africa
secured significant corporate savings business in Lesotho and Namibia.

The value of new business increase of 48% to R157 million was driven by the strong new business volumes, an improved mix towards higher margin products, and
good expense management across the Group. This was however offset by a change in reinsurance modelling. The Group's new business margin was 0.9%.

Segmental performance

Momentum Life

R million                     1Q2022  Restated  change %
Operating (loss)/profit           (3)      284   <(100)%
Investment return                 25        31     (19)%
Normalised headline earnings      22       315     (93)%
Recurring premiums               247       247        0%
Single premiums                  523       490        7%
PVNBP                          1 736     1 722        1%
VNB                                -        12   <(100)%
New business margin             0.0%      0.7%

Normalised headline earnings

Momentum Life's normalised headline earnings declined from R315 million to R22 million. The decline in operating profit from R284 million to an operating
loss of R3 million is largely attributable to net mortality losses of R241 million (net of reinsurance and tax). The total mortality claims amount was four
times higher than in the comparative prior period. No additional Covid-19 provisions were raised at this stage, this will however be reassessed as part of
the half-year valuation.

New business

At R1.7 billion, PVNBP for Momentum Life increased marginally, with new business volumes growing in long-term savings business, while protection new
business volumes were lower.

VNB declined to zero, resulting in a new business margin of 0.0%. This can be explained by the shift in the business mix towards more long-term savings
business, and marginal PVNBP growth.

Momentum Investments

R million                       1Q2022  Restated    change %
Operating profit                   173       262       (34)%
Investment return                   22       (15)      >100%
Normalised headline earnings       195       247       (21)%
Recurring premiums                  49        40         23%
Single premiums                 10 858     8 495         28%
PVNBP                           11 059     8 698         27%
VNB                                 91        64         42%
New business margin               0.8%      0.7%

Normalised headline earnings

Normalised headline earnings from Momentum Investments declined by 21% to R195 million compared to the prior period. This includes a 34% decline in
operating profit to R173 million, which was mainly driven by a decline in earnings from annuities and structured products following lower credit spreads and
the negative impact of yield curve movements. Operating profit in Momentum Wealth's investment platform business was negatively impacted by ongoing
implementation expenses of replacing their legacy platform with a new platform. The investment management businesses in South Africa and the UK saw an
increase in asset-based fee income, with AUM growth aided by positive net inflows.

New business

PVNBP for Momentum Investments increased by 27% to R11.1 billion. This was aided by strong growth in single premium sales achieved from guaranteed
annuities, which grew by 47% and the Momentum Wealth investment platform which delivered 25% growth. The VNB improved from R64 million to R91 million mainly
due to the growth in new business volumes, an improved business mix towards higher margin annuities, and good expense management. These contributed to the
improvement in the new business margin to 0.8%.

Assets under management

Assets under management on the Momentum Wealth investment platform increased by 18%, aided by positive net inflows. Institutional and retail assets under
management increased by 21% and 12% respectively, again mainly due to good inflows. The acquisition of Seneca Investment Managers in the UK also contributed
R15.5 billion to the growth in institutional assets under management.

Metropolitan Life
R million                     1Q2022  Restated     change %
Operating profit                  63       187        (66)%
Investment return                 12        17        (29)%
Normalised headline earnings      75       204        (63)%
Recurring premiums               420       301          40%
Single premiums                  417       246          70%
PVNBP                          1 730     1 100          57%
VNB                               79        51          55%
New business margin             4.6%      4.6%

Normalised headline earnings

Metropolitan Life's normalised headline earnings declined by 63% to R75 million. Excluding the investment return on shareholder assets that were allocated
to Metropolitan Life, the operating profit decline of 66% to R63 million was mainly driven by negative investment variances of R57 million following changes
in the real yield curve, which affects the expected inflation used in the actuarial valuation, as well as the impact of the equity volatilities on the
investment guarantee reserve. Operating profit was further negatively impacted by a R56 million one-off negative persistency experience, primarily related
to the correction of system issues experienced from the system migration in the first quarter of F2021. Mortality experience was better than expected in the
Covid-19 reserve modelling and a zero variance was recorded for the quarter, after the release of R87 million of the Covid-19 provision.

New business

As observed in recent quarters, we saw a continuation of new business growth and a change in new business mix to more profitable products. Metropolitan Life
PVNBP increased by 57% compared to the prior period to R1.7 billion. This includes continued improvement in protection new business and annuity and
structured single premiums, which delivered encouraging year-on-year growth of 58% and 89% respectively. It must, however, be noted that prior period levels
were subdued due to stricter lockdown conditions.

Owing to a more experienced sales force, digital enablement and adoption, as well as the launch of new client solutions, the average adviser productivity
has continued to improve over the quarter and exceeded the pre-pandemic levels.

Metropolitan Life achieved growth on VNB of 55% to R79 million, which is mainly attributable to strong new business volumes and the change in the new
business mix towards more protection, annuity and structured products. This led to the new business margin of 4.6% which is approaching our long-term
targeted margin of 5.0%.

Momentum Corporate
R million                     1Q2022           1Q20215    change %
Operating profit                 134                85         58%
Investment return                 22                11        100%
Normalised headline earnings     156                96         63%
Recurring premiums               118                81         46%
Single premiums                  678               619         10%
PVNBP                          1 520             1 230         24%
VNB                              (12)              (14)        14%
New business margin           (0.8)%            (1.1)%

Normalised headline earnings

Momentum Corporate's normalised headline earnings increased by 63% to R156 million. The operating profit grew by 58% to R134 million, supported by strong
earnings growth in the disability business, with both income and lump-sum disability products delivering positive results, aided by the re-pricing programme
that has taken place over the last three years and better return-to-work experience. Net mortality variance, after the release of R390 million (net of tax)
of the Covid-19 provision, was a loss of R30 million. The result was also reduced by negative investment variances of R37 million which was caused by yield
curve movements as well as market movements increasing the cost of the guarantees on the smooth bonus book. Expenses continued to be well-contained.

New business

Momentum Corporate's PVNBP increased by 24% to R1.5 billion. This result was supported by strong growth of 46% in recurring premium volumes on group risk
and FundsAtWork products during the quarter, as well as a 10% increase in single premium volumes. The VNB of -R12 million was a 14% improvement on the prior
period and was aided by increased new business volumes, writing insurance business at improved margins, and good expense management, slightly offset by new
business mix being weighted toward smaller schemes with higher per policy costs. This translated to a new business margin of -0.8%.

Momentum Metropolitan Health

R million                     1Q2022  Restated  change %
Operating profit                  46        56     (18)%
Investment return                  2        (3)    >100%
Normalised headline earnings      48        53      (9)%

Normalised headline earnings

Normalised headline earnings for Momentum Metropolitan Health declined by 9% against the prior period, to R48 million. The increase in fee income from
continued growth in the lowcost product (Health4Me) and public sector membership was offset by the normalisation of claims paid on insurance products, as
well as an increase in expenses from Covid-19 vaccination sites and the on-boarding of large clients. An increase in the share of profits attributable to
minority shareholders further impacted normalised headline earnings negatively.


Membership increased by 6% year-on-year, mainly due to continued growth in public sector and low-cost product membership, as well as the on-boarding of a
large corporate client in January 2021. Organic membership growth in the corporate and mining segments remains tightly linked to general economic growth.

Non-life Insurance

R million                     1Q2022  Restated   change %
Guardrisk                        188        85      >100%
Momentum Insure                   60        62       (3)%
Normalised headline earnings     248       147        69%
Operating profit                 181       141        28%
Investment return                 67         6      >100%

Normalised headline earnings

Non-life Insurance delivered a 69% year-on-year growth in normalised headline earnings to R248 million. This includes an operating profit improvement of 28%
from the prior period due to good underlying operational growth from Guardrisk. Investment returns on shareholder assets increased sharply due to the
recognition of the net asset value of a cell recently acquired at discount to NAV.


Guardrisk's normalised headline earnings more than doubled year-on-year to R188 million. Operating profit improved, supported by growth in management fees
in the mining rehabilitation and life divisions, and growth of 55% in underwriting profits. Investment return benefited from the recognition of the value of
a cell that was recently taken over at a discount to its net asset value, increasing normalised headline earnings by R57 million. Guardrisk benefited from
its diversification in terms of industry and product type exposure across the cells, offsetting the impact that Covid19 had in some of its areas.

R million                1Q2022  Restated   change %
Gross earned premium        964       888        14%
Net earned premium          346       369       (6)%
Claims incurred            (128)     (176)     (27)%
Underwriting expenses      (105)     (120)     (13)%
GGI underwriting profit     113        73        55%

Momentum Insure

From 1 July 2021, results are reported for Momentum Insure as a single business, following the license consolidation and completion of the first phase of
the integration of the two previous businesses.

Momentum Insure reported normalised headline earnings of R60 million, largely in line with the prior period. New business was behind the prior period;
however, persistency remained good, resulting in an overall increase in gross written premiums. The claims ratio for the quarter of 58% was better than
expected due to relatively drier inland weather conditions. However, it declined from 51% in the prior period, which benefitted from lower motor claims
under stricter lockdown conditions.

Momentum Metropolitan Africa

R million                       1Q2022  Restated change %
Namibia                            (12)       62  <(100)%
Botswana                           (22)       25  <(100)%
Lesotho                             37        98    (62)%
Ghana                               16        13      23%
Other countries                    (23)      (11) <(100)%
Centre costs                       (29)      (22)   (32)%
Normalised headline earnings       (33)      165  <(100)%
Operating (loss)/profit            (83)       69  <(100)%
Investment return                   50        96    (48)%
Recurring premium new business     119        86      38%
Single premium new business        640       223    >100%
PVNBP                            1 202       675      78%
VNB                                 (1)       (7)     86%
New business margin             (0.1)%    (1.0)%

Normalised headline earnings

Normalised headline earnings declined to a loss of R33 million, which was driven by net mortality losses of R81 million (net of reinsurance and tax)
following a sharp increase in mortality claims in both Namibia and Botswana during the first quarter of F2022 as well as a decline in investment variance
due to yield curve movements in Namibia and an increase in the investment guarantee reserve in Lesotho and Namibia.

New business

PVNBP for Momentum Metropolitan Africa increased by 78% to R1.2 billion year-on-year. This was supported by significant corporate savings business secured
in Lesotho and Namibia.

The VNB improved from -R7 million to -R1 million year-on-year, which was mainly driven by good new business volumes including increasing sales of profitable
risk business in Namibia. This was offset by a change in new business mix away from protection products towards savings products in Lesotho. Overall, the
new business margin was -0.1%.

New Initiatives

R million                             1Q2022  Restated  change%
India (JV with Aditya Birla Capital)6   (130)      (72)   (81)%
aYo (JV with MTN)                         (2)      (13)     85%
Other7                                   (26)      (24)    (8)%
Normalised headline earnings            (158)     (109)   (45)%

Aditya Birla Health Insurance

Gross written premiums (GWP) increased by 31% to R733 million, with strong growth in both retail and group business. The operational performance of ABHI was
negatively impacted by the spike in number and average size of Covid-19 related claims from 1 April 2021 to 30 June 20216, of which Momentum Metropolitan's
share amounted to approximately R60 million. The claims ratio, excluding Covid-19, tracked satisfactorily close to the business plan.

ABHI continues to build scale while maintaining a focus on expense management. The business has maintained its growth trajectory and, except for the Covid-
19 related claims, is performing in accordance with the business case and business plan.


The share of losses has declined following the strategic decision to sell our remaining stake in aYo to MTN. The disposal transaction was finalised in
September 2021.


R million                     1Q2022  Restated   change %
Operating loss                   (14)      (60)       77%
Investment return                172       (16)     >100%
Investment income                 (3)        4    <(100)%
Fair value gains                 175       (20)     >100%
Normalised headline earnings     158       (76)     >100%

The Shareholders segment's normalised headline earnings of R158 million represent a significant improvement on the prior period. The 77% improvement in
operating losses was largely driven by the restructuring of lease arrangements and a reduction in incentive costs.

The operating loss was offset by the significant improvement in investment return from a loss of R16 million in the prior period to R172 million in the
current period. This was supported by significant fair value gains from the revaluation of the Group's investment in venture capital funds and the recovery
in investment markets.

6  Results for the India investment are reported with a three-month lag
7  Other includes certain costs relating mainly to Exponential Ventures, as well as Multiply Money ans Momentum Consult


As evidenced by the continued growth in our new business volumes and improvement in our competitive position of most market segments, the underlying
operational performance of the Group continues to improve.

Looking ahead, we remain cautious about the pace of economic recovery across our operating regions, as disposable income will remain under pressure because
of depressed economic activity. Uncertainty about the timing and magnitude of the expected fourth wave of Covid-19 and the pace of the vaccine rollout
programme remains.

While earnings could remain volatile, we continue to estimate that in the absence of extraneous shocks, the underlying level of normalised headline earnings
for the Group is around R800 million to R900 million per quarter. We also believe that the Reinvent & Grow financial targets for F2024 (normalised headline
earnings of R4.6bn to R5.0bn and ROE of 18% to 20%) remain realistic, despite the modest macroeconomic backdrop.

We remain focused on delivering on the Reinvent and Grow strategy objectives.

We are navigating through this challenging period with strong solvency and liquidity positions. This financial strength enables the business units to focus
on delivering on strategic objectives that are under their control and not be constrained by any external shocks that might arise in due course. This means
that we are building an organisation that is increasingly able to meet the needs of its clients and other stakeholders - and in due course, when the
external environment improves, this should be reflected in the financial performance of the group.

23 November 2021

The information in this commentary, including the financial information on which the outlook is based, has not been reviewed and reported on by Momentum
Metropolitan's external auditors.

Conference call

The executive management of Momentum Metropolitan will be hosting a conference call for shareholders, investors and analysts on 23 November 2021.

We kindly request callers to pre-register using the following link

A passcode and pin will be generated following registration. We advise callers to dial in 5 minutes before the conference call starts at 11:00.

Access numbers for participants dialling live from their country:

South Africa                         011 535 3600 (Neotel)
                                     010 201 6800 (Telkom)
UK                                   0 333 300 1418
USA and Canada                       1 508 924 4326
Other Countries                     +27 11 535 3600

The recorded playback will be available for three days after the conference call.

Access Numbers for Recorded Playback:

South Africa                         010 500 4108
UK                                   0 203 608 8021
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Access code for recorded playback:   41103

Equity sponsor:
Merrill Lynch South Africa (Pty) Limited t/a BofA Securities

Sponsor in Namibia
Simonis Storm Securities (Pty) Limited

Debt Sponsor
Rand Merchant Bank (a division of FirstRand Bank Limited)

Date: 23-11-2021 07:05:00
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