Empowerment announcement

Old Mutual PLC
05 September 2006

Old Mutual plc
Incorporated in England and Wales
(Registration number: 3591559)
ISIN: GB0007389926, JSE share code: OML, NSX share code: OLM,
Issuer code: OLOML
('Old Mutual plc')

Nedbank Group Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1966/010630/06)
JSE share code: NED ISIN: ZAE000004875
('Nedbank Group')

Mutual & Federal Insurance Company Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1970/006619/06)
JSE share code: MAF,   NSX share code: MTF
ISIN: ZAE000010823
('Mutual & Federal')

Old Mutual Life Assurance Company (Namibia) Limited
(Incorporated in the Republic of Namibia)
(Registration number: 97/081)
('Old Mutual Namibia')

NedNamibia Holdings Limited
(Incorporated in the Republic of Namibia)
(Registration number: 91/075)
('NedNamibia Holdings')

Mutual & Federal Insurance Company of Namibia Limited
(Incorporated in the Republic of Namibia)
(Registration number: 1989/459)
('Mutual & Federal Namibia')


Empowering the Old Mutual Group businesses in the Republic of Namibia

Transformation is a business imperative for the Old Mutual Group's Namibian
businesses and Black Economic Empowerment is a key requirement for the
promotion of sustainable economic growth and social development in Namibia.
Old Mutual Namibia's presence in the country goes back to 1921.

Today the Old Mutual Group operates three strong franchises which employ over
1 000 people in Namibia, service more than 142 000 clients and manage assets
of some N$16.9 billion.

Introduction
As a major financial force in the economy of the Republic of Namibia
('Namibia'), it is important that the interests of the shareholders of Old
Mutual plc and those of its subsidiaries Nedbank Group and Mutual & Federal
(collectively, 'the Group'), are aligned with the long-term prosperity and
success of Namibia. The businesses in Namibia comprise Old Mutual Namibia,
NedNamibia Holdings and Mutual & Federal Namibia and their subsidiaries ('the
Group's Namibian business').

Transformation is a business imperative for the Group's Namibian businesses
and Black Economic Empowerment ('BEE') is a key requirement for the promotion
of sustainable economic growth and social development in Namibia. Old Mutual
Namibia's presence in the country goes back to 1921. Today the Group operates
three strong franchises which employ over 1 000 people in Namibia, service
more than 142 000 clients and manage assets of some N$16.9 billion.

Significant progress has been made over the past decade in implementing BEE
into the Group's Namibian businesses through employment equity, skills
development, procurement practices, enterprise development and corporate
social investment programmes.

The Group will now introduce black equity ownership through three separate but
interdependent transactions. These transactions are truly broad-based and
include staff and management, distributors, trade union members and their
families, entrepreneurs, and women's and church groupings across the length
and breadth of Namibia.

The Group's BEE transaction will be the largest ever undertaken in Namibia,
being more than three times greater in value than any other deal concluded to
date. Moreover, in terms of true transformation, this deal will be the most
broad-based as over 250 000 black Namibians will be empowered and their lives
enhanced, both directly and indirectly, through the transaction.

Group Transactions
The Group proposes three separate transactions which will introduce new broad-
based black ownership into each of its Namibian businesses (collectively
referred to as the 'Group Transactions') which will equate to:

• 13.31% of Old Mutual Namibia, through the issue of new ordinary shares in
Old Mutual plc. No shareholder approval is required for the issue of these
shares as they are issued under existing authorities previously approved by
Old Mutual plc shareholders;

• 11.13% of NedNamibia Holdings, through the issue of new ordinary shares in
Nedbank Group which will amount to 0.15% of the enlarged issued share capital.
This issue is deemed a specific issue of shares for cash in terms of the
Listings Requirements of the JSE Limited and is subject to the approval of
Nedbank Group shareholders; and

• 11.42% of Mutual & Federal Namibia, through the issue of new ordinary shares
in Mutual & Federal which will amount to 0.26% of the enlarged issued share
capital of Mutual & Federal. This issue is deemed a specific issue of shares
for cash in terms of the Listings Requirements of the JSE Limited and is
subject to the approval of Mutual & Federal shareholders.

Namibians currently hold approximately 0.35% of Old Mutual plc, 0.70% of
Nedbank Group and 0.62% of Mutual & Federal respectively.

The table below provides a summary of the participants, the value of the
shares to be issued to each group of participants and the effective black
shareholding to be acquired in each of the Group companies Namibian
operations:

Summary of the effective ownership in the Namibian businesses
                                                                        Total
                                                                     value of
                   Old Mutual    Nedbank Group  Mutual & Federal shareholding
                  N$m       %      N$m       %    N$m      %      N$m      £m

Employees and
Management      66.96     4.01   21.40    3.47   7.58    4.25   95.94    7.10
Strategic
Business
Partners        33.75     2.05   20.25    3.37   6.75    3.97   60.75    4.50
Strategic
Community
Partners        12.50     0.76    7.50    1.24   2.50    1.46   22.50    1.67
Distributors
Trust           35.00     2.12       -       -      -       -   35.00    2.59
Education
Trust           40.00     2.42   10.00    1.67      -       -   50.00    3.70
Long-term
Strategic
Allocation      32.25     1.95    8.25    1.38   2.96    1.74   43.46    3.22
Total          220.46    13.31   67.40   11.13  19.79   11.42  307.65   22.78

Notes:
1. Percentage of the respective Namibian business value.
2. Exchange rate - ZAR1:N$1/£1:N$13.5126 (weighted average exchange rate from
25 August 2006 to 31 August 2006).

Rationale for the Group Transactions
Old Mutual plc is an international financial services group with significant
business interests in Africa, the United States of America, Europe and the
United Kingdom. Old Mutual plc is listed on the London Stock Exchange plc
('LSE') and other stock exchanges in Namibia, the Republic of South Africa
('South Africa'), the Republic of Malawi, the Republic of Zimbabwe and the
Kingdom of Sweden.

Namibia represents a portion of the Group's African business and, through
clients' savings, the Group is a significant contributor to the Namibian
economy. It is therefore important that Old Mutual plc's shareholders' long-
term interests are aligned with the success of Namibia as a country.

Unlike South Africa, where the Financial Sector Charter ('FSC') and the South
African Department of Trade and Industry Codes of Good Practice on Broad-Based
Black Economic Empowerment (the 'SA Codes') set out certain BEE ownership
requirements for South African financial services companies, there is
currently no such legislation or industry agreement in Namibia. The financial
services industry in Namibia is in the process of establishing a charter for
Namibia, with management of the Group's businesses in Namibia having
participated in this process. It is expected that such a charter will be
derived from the guidelines provided by the Namibian Minister of Finance and
to some extent from precedents in South Africa, being the South African FSC
and the more recently introduced SA Codes. Notwithstanding the fact that no
legislation or industry charter currently exists in Namibia, the Group
believes that BEE in Namibia is imperative for the following reasons:

• many financial sector entities have already concluded BEE deals and
therefore have a significant commercial and competitive advantage over their
competitors who have not concluded BEE deals;

• the proposed transaction will help to grow the Namibian businesses through
interactions with BEE partners;

• the Group Transactions will assist in the retention of Namibian business
that is at risk of being lost if the Namibian businesses do not acquire
Namibian BEE ownership credentials;

• the deal will improve the profile of the Group's Namibian businesses;

• the proposal will assist strategic and holistic transformation of the Group
in Namibia; and

• the proposal empowers black staff in Namibia.

The Group Transactions have been designed to complement the Group's overall
strategy of implementing broad-based black empowerment into its Namibian
businesses. The Group Transactions are truly broad-based and include staff and
management, distributors, trade union members and their families,
entrepreneurs, as well as women's and church groupings throughout Namibia.

The owners of shares to be issued in the Group Transactions are set out below:

• Employees and Management - The Group recognises the importance of creating
an employee and management complement that is representative of Namibia's
demographics. Acknowledging that the Group is not yet demographically
representative at all levels in its Namibian businesses and that
transformation comes from within, the Group proposes to set aside shares with
a market value of N$95.94m (£7.10m) to recruit, retain and incentivise black
employees and management.

• Strategic Business Partners - Central Investment Holdings (Proprietary)
Limited ('Central Investment'), Manmar Investment Thirty Five (Proprietary)
Limited ('Manmar') and Northern Empowerment Investments (Proprietary) Limited
('Northern Empowerment Investments') have been chosen as active Strategic
Business Partners to assist in growing the business and driving
transformation. These partners will be issued with shares worth N$60.75m
(£4.50m) in aggregate.

• Strategic Community Partners - Women's Action for Development ('WAD') and a
consortium of some of Namibia's largest churches, whose congregations are
predominantly black, have been chosen as active partners to assist in growing
the business. The churches are the Evangelical Lutheran Church in Namibia
('ELCIN'), the Evangelical Lutheran Church in the Republic of Namibia
('ELCRN') and the African Methodist Episcopal Church in Namibia ('AME'). The
Strategic Community Partners will be issued shares worth N$22.50m (£1.67m) in
aggregate.

• Distributors Trust - Part of Old Mutual Namibia's strategy is to expand its
client base by developing black financial advisers and brokers in Namibia. As
such, an aggregate of N$35.00m (£2.59m) worth of Old Mutual plc shares have
been set aside to assist in the development of distributors throughout
Namibia.

• Education Trust - In aggregate, N$50.00m (£3.70m) of Old Mutual plc and
Nedbank Group shares are being allocated in order to assist with the education
of black members of trade unions, and their families, who do business with Old
Mutual Namibia and NedNamibia Holdings.

• Long-term Strategic Allocation - An allocation of shares has been made to
assist with future long-term strategic initiatives amounting to N$43.46m
(£3.22m). These shares will be used by each of the Group companies to
capitalise on strategic opportunities that may arise in the future which could
add value to the Group companies.

Principles of the Group Transactions
In designing the Group Transactions, the Group developed a set of principles
aimed at sustainable, broad-based empowerment. These principles include:

• Transformation - The Group has designed the Group Transactions to accelerate
operational transformation. This extends to employment equity, particularly at
the management level, client acquisition, strategies for underserved markets,
profiling the Group and community involvement. The Group Transactions are
being implemented as part of the Group's comprehensive, overarching approach
to rapid transformation in Namibia.

• Broad-based approach - The Group Transactions are designed to, directly or
indirectly, benefit more than 250 000 black Namibians across the country,
including employees and management, women's groupings, trade union members,
entrepreneurs and communities. The Group has sought to achieve an equitable
balance between individuals that are internal and external to the Group. In
the process, the ultimate beneficiaries of the Group Transactions have been
reviewed to ensure that no individual benefits unduly. Employees and
management will be the primary beneficiaries of the Group Transactions.

• Alignment of value added to benefits received - No one individual or
ultimate beneficiary will be rewarded out of proportion to the value that they
add.

• Performance agreements have been negotiated with the Strategic Business
Partners and Strategic Community Partners to ensure mutually beneficial,
enduring relationships.

• The performance agreements have been designed to incentivise the Strategic
Business Partners and Strategic Community Partners by aligning their rewards
which they receive under the performance agreements to the value that they add
to the businesses.

• The Group Transactions seek to ensure that benefits are earned incrementally
over the term of the agreements.

• Full economic benefits and voting rights - From the inception of the Group
Transactions, shareholders and beneficiaries must have the full benefits of
the voting rights and the economic benefits attached to equity ownership.

• Estimated benefits to exceed the estimated costs of the Group Transactions -
In designing the Group Transactions, the Group sought to ensure that, over
time, the commercial benefits of implementing the Group Transactions would
outweigh the costs and that the costs are in line with other BEE transactions
concluded to date.

• Maximising long-term shareholder value - The overall economic cost of the
Group Transactions equates to approximately 3.70% of the value of the Group's
Namibian businesses. The effective economic cost to Old Mutual plc
shareholders, taking into account Old Mutual plc's effective holdings in
Nedbank Group and Mutual & Federal, is N$76m or approximately 0.06% of Old
Mutual plc's current market capitalisation. The initial impact is a decrease
in embedded value per Old Mutual plc share of less than 1%. Adjusted operating
profit per Old Mutual plc share (which excludes initial costs of the Group
Transactions) and basic earnings per share (which includes initial costs)
decreases by less than 1%.

The Group expects the benefits of the different elements of the Group
Transactions to significantly outweigh the costs over the longer term.

Transaction summary
Subject to the fulfilment of the conditions precedent set out in paragraphs
3.11, 4.12 and 5.9 below, which include, inter alia, the approval of Nedbank
Group and Mutual & Federal shareholders, the Group proposes to implement three
separate transactions that will result in black ownership of at least 11% in
the Namibian businesses as a whole, as defined below, including:

• the issue of Old Mutual plc's shares resulting in effective black
shareholding worth 13.31% of Old Mutual Namibia (the 'Old Mutual
Transaction'). The Initial Market Value of the Old Mutual Plc shares will be
N$21.64 less the Namibian dollar equivalent of any dividend per share that Old
Mutual plc may declare in respect of its interim results to 30 June 2006.
Based on the price of N$21.64 per share, ignoring any interim dividend, the
number of shares to be issued will equal approximately 0.19% of Old Mutual
plc's current issued share capital;

• the issue of 0.15% of Nedbank Group's current issued share capital with
resulting effective black shareholding worth 11.13% of NedNamibia Holdings
(the 'Nedbank Group Transaction'); and

• the issue of 0.26% of Mutual & Federal's current issued share capital with
resulting effective black shareholding worth 11.42% of Mutual & Federal
Namibia (the 'Mutual & Federal Transaction').

As part of this process, Old Mutual plc, Nedbank Group and Mutual & Federal
have signed detailed Subscription Agreements with the Strategic Business
Partners and Strategic Community Partners setting out the terms of their
participation. Detailed performance agreements have also been entered into
between the Strategic Business Partners and Strategic Community Partners and
Old Mutual Namibia, NedNamibia Holdings and Mutual & Federal Namibia, setting
out the required performance criteria together with the implications of
exceeding or not meeting those criteria.

In summary, the table below sets out the value of shares which will be issued
through the Group Transactions and the respective black ownership portion:

Summary of Group Transactions
                                                            Black ownership
                                                                    portion
                                                                   Value as
                                                                     a % of
                                                                   Namibian
                                                                   business
                                   Value of      Value of        post-issue
                                     shares        shares         of shares
                                        N$m            £m                 %
Old Mutual Transaction               220.46         16.32             13.31
Nedbank Group Transaction             67.40          4.99             11.13
Mutual & Federal Transaction          19.79          1.46             11.42

This announcement sets out the details and financial effects of the Old Mutual
Transaction, the Nedbank Group Transaction and the Mutual & Federal
Transaction and the combined financial effects for Old Mutual plc
shareholders.

1. Impact of the Group Transactions on Old Mutual plc shareholders

1.1 Accounting treatment of the Group Transactions
In accordance with the Rules of the UK Listing Authority, the JSE Limited and
the Namibian Stock Exchange ('NSX'), the underlying accounting treatment is in
accordance with the accounting policies set out in the last published audited
financial information. In presenting the consolidated impact for Old Mutual
plc of the Group Transactions, information is to be presented in accordance
with International Financial Reporting Standards ('IFRS'). The accounting
treatment adopted may require transactions to be accounted for in a different
manner to their legal substance and form.

The following accounting principles are applicable:

• Accounting for share-based payments - Costs of the Group Transactions are
accounted for in accordance with IFRS2: Share-based payments. The costs of the
services provided by the employees, Strategic Business Partners and Strategic
Community Partners are recognised in the income statement over the vesting
period for the instruments granted, based on the fair value of the services
provided. Fair value is determined by reference to the fair value of the
instruments granted.

• Consolidation of Special Purpose Vehicles ('SPVs') - Where control is deemed
to remain within the Group, the entities established to support the Group
Transactions are regarded as subsidiaries. These SPVs include those relating
to the Distributors Trust and Education Trust. The acquisition of Old Mutual
plc shares by the consolidated SPVs are regarded as issues of treasury shares,
resulting in a reduction in equity within the consolidated financial
statements.

• Earnings per share - The weighted average number of shares is impacted by
the Group Transactions only to the extent that any issue of shares is not
regarded as treasury shares for the purpose of the consolidated financial
statements.

• Embedded value per share (Old Mutual plc impact only) - The number of shares
in issue will increase to include the Old Mutual plc shares acquired by all
SPVs. Where deferred consideration is to be received for the issue of the
shares, an adjustment to the embedded value is required to represent the
discounted present value of the consideration.

1.2 Combined pro forma financial effects for Old Mutual plc shareholders
The Group Transactions do not reduce, on a consolidated basis, Old Mutual
plc's consolidated Basic Earnings Per Share ('EPS') and adjusted Operating EPS
for the year ended 31 December 2005 by more than 1%, and do not decrease
Adjusted Embedded Value ('EV') per share at 31 December 2005 by more than 1%.
As these do not have a material impact on the financial results of the larger
Group, we have not included the detailed financial effects in this
announcement.

2. Black shareholder groupings

2.1 Employee and management schemes
Current and future employees are a critical component of the Group's
transformation strategy. By reserving a significant portion of shares for the
benefit of current and future black managers and employees, the Group
Transactions will assist in transforming and creating a dynamic, effective
workforce. To this end, each of the Group Transactions incorporates a broad-
based component which allows for an award of shares to the value of N$8 000
(£592) to employees who have not participated in any other employee and
management share scheme of the Group. The employee and management schemes also
provide the Group with sufficient resources to meet its ongoing employment
equity targets.

2.2 Strategic Business Partners and Strategic Community Partners

2.2.1 Overview of the Strategic Business Partner and Strategic Community
Partner selection process
The Group has selected Central Investment, Manmar and Northern Empowerment
Investments as its Strategic Business Partners and WAD and a consortium of
some of Namibia's largest churches, whose congregations are predominately
black, being ELCIN, ELCRN and AME. The selection process involved the
assessment of the potential Strategic Business Partners and Strategic
Community Partners against the following criteria:

• Empowerment credentials and broad-based criteria - An assessment of the
shareholding and the ultimate beneficiaries of the Strategic Business Partners
and Strategic Community Partners with the specific objective of ensuring that
potential partner companies are black owned and controlled companies,
representing a broad-base of beneficiaries. Consideration was also given as to
whether directors, management and leadership of the potential Strategic
Business Partners and Strategic Community Partners were predominantly
comprised of black people.

• Leadership and values - An assessment was made as to whether the potential
Strategic Business Partners and Strategic Community Partners had strong, clear
leadership and shared the Group's values. Regard was also given as to whether
the leadership of the potential Strategic Business Partners and Strategic
Community Partners would be able to commit sufficient time and resources to
focus on business development and transformation.

• Experience - An assessment as to whether the potential Strategic Business
Partners had a demonstrable track record of transformational ability as well
as relevant business experience.

A further assessment of each of the potential Strategic Business Partners' and
Strategic Community Partners' ability to assist Old Mutual Namibia, NedNamibia
Holdings and Mutual & Federal Namibia with each of the following objectives
was undertaken:

• the retention of existing business and the attraction of additional
business;

• the strategic and holistic transformation of the Group's businesses in
Namibia in response to a changing business environment; and

• improving the corporate profile and image of the Group's businesses in
Namibia and helping to position the businesses.

This process assisted the Group to determine the level of participation of
each of the Strategic Business Partners and Strategic Community Partners in
the Group Transactions.

2.2.2 Performance Agreements
The Strategic Business Partners and Strategic Community Partners have each
concluded performance agreements with Old Mutual Namibia, NedNamibia Holdings
and Mutual & Federal Namibia, which will govern the relationship with and
performance and remuneration of the Strategic Business Partners and Strategic
Community Partners. It is intended that, on an annual basis, the Strategic
Business Partners and Strategic Community Partners will meet with each of the
business units of Old Mutual Namibia, NedNamibia Holdings and Mutual & Federal
Namibia, as appropriate, in order to detail the specific tasks to be performed
in the following twelve-month period. The Strategic Business Partners and
Strategic Community Partners have agreed the first set of performance criteria
with Old Mutual Namibia, NedNamibia Holdings and Mutual & Federal Namibia
which will benchmark future performance agreements in terms of the type and
the amount of work required and which will apply to the twelve-month period
from 1 January 2007. In terms of the performance agreements, the Strategic
Business Partners and Strategic Community Partners will commit time and
resources to the business units of Old Mutual Namibia, NedNamibia Holdings and
Mutual & Federal Namibia in order to meet the requirements of their respective
performance agreements. Progress will be assessed semi-annually.

The Strategic Business Partners and Strategic Community Partners will be paid
an annual performance fee that will be linked to performance targets achieved
in terms of the performance agreements, the annual fee combined for all
parties will range between N$ nil (£ nil) and N$3.56m (£0.26m) for Old Mutual
Namibia, N$ nil (£ nil) and N$2.14m (£0.16m) for NedNamibia Holdings and N$
nil (£ nil) and N$0.72m (£0.05m) for Mutual & Federal Namibia. A portion of
this performance fee will be used to cover pre-agreed working capital
requirements of the Strategic Business Partners and Strategic Community
Partners. The balance in the case of the Old Mutual Transaction will be
applied to satisfy the amounts remaining due in respect of the Old Mutual
shares issued to the relevant SPV. In the case of the Nedbank Group
Transaction and the Mutual & Federal Transaction, the balance will be utilised
to acquire new Nedbank Group and Mutual & Federal shares, respectively, as
detailed in the paragraphs dealing with the funding arrangements in the
separate Old Mutual, Nedbank Group and Mutual & Federal sections below.

2.2.3 Subscription Agreements
The Subscription Agreements with the Strategic Business Partners and Strategic
Community Partners are detailed and contain a number of provisions designed,
inter alia, to ensure that the partners:

• remain black companies or organisations during the 10 year lock-in period;

• do not dispose of any shares acquired as a result of the Group Transactions
during such lock-in period; and

• do not enter into equity transactions or enter into conflicting
relationships with any of the Group's competitors.

The Subscription Agreements also contain provisions dealing with certain
possible events such as the transactions not meeting the BEE requirements in
Namibia that may be subsequently introduced the potential consolidation of the
Group's businesses in Namibia and a warehousing arrangement of the relevant
Group shares in the event that the participation of one or more parties to the
Group Transaction may be terminated due to breach by that party.

2.2.4 Strategic Business Partners
2.2.4.1 Central Investment
The consortium consists of four separate groups, namely Fox Investments
(Proprietary) Limited (45%), Ripanga Investment Holdings (Proprietary) Limited
(25%), Latenda Investment Holdings (Proprietary) Limited (15%) and Prudent
Investments (Proprietary) Limited (15%). All four groups have shareholders of
high standing in the business and public sector and are prominent and credible
individuals who can add significant value to the Group businesses in Namibia.
Women's participation equates to 46% of this consortium.

2.2.4.2 Manmar
The consortium comprises key individuals from Namibia's coastal business
community who occupy influential positions in the construction, fishing,
media, medical and mining sectors. The consortium intends to expand to include
other groups within the coastal region. This consortium will add value to the
Namibian businesses in the corporate and retail areas.

2.2.4.3 Northern Empowerment Investments
A group of eight businessmen and women who are prominent in Namibia's northern
regions have formed Northern Empowerment Investments as their consortium
vehicle for the Group Transactions. The northern regions of Namibia are home
to more than half of the population of the country and this region is expected
to offer significant growth prospects to the Group's Namibian businesses.
Women's participation equates to 25% of this consortium.

2.2.5 Strategic Community Partners
2.2.5.1 Churches
Churches were included due to their strong social focus, their particular
focus on the upliftment of the most disadvantaged Namibians and also to
acknowledge the role played by churches in the liberation of Namibia. This
group comprises three of the largest black churches in Namibia. Over 90% of
Namibians consider themselves Christians and, as such, the Group's Namibian
businesses believe that properly organised church entities can add substantial
value, especially in the areas of Group-wide marketing, the retail businesses
of NedNamibia Holdings and Mutual & Federal Namibia and in Old Mutual Namibia
Group Schemes. A significant feature of the Group interface with the churches
will be that the majority of the cooperation will be channelled through the
women's desks of the respective churches.

2.2.5.2 Women's Action for Development
WAD, a non-profit organisation with a membership base of 15 000 women,
represents the interests of predominantly rural women in Namibia and has a
high profile in many regions of Namibia. WAD was included due to their social
focus in particular, women's upliftment and skills development which encourage
financial independence. WAD provides a major development and advocacy platform
for social and developmental issues and promises to be a powerful partner for
the Group.

2.3 Distributors Trust
Old Mutual Namibia has established a Black Distributors Trust to support black
people wishing to develop brokerage businesses in Namibia as detailed in
paragraph 3.4 below.

2.4 Education Trust
Old Mutual Namibia and NedNamibia Holdings have established an Education Trust
to assist with the education of black members trade unions and their families
who do business with Old Mutual Namibia and NedNamibia Holdings as detailed in
paragraphs 3.5 and 4.6 below.

Key features:
• Resultant black ownership at 13.31% of Old Mutual Namibia

• Key black shareholders including: Employees and Management, Distributors,
Education Trust, Strategic Business Partners and Strategic Community Partners

• Aimed at 325 black employees

• Distributors Trust to include black distributors and an Education Trust to
assist with the educational needs of union members and their dependents

• Performance agreements with broad-based Strategic Business Partners and
Strategic Community Partners

• Aligned with empowerment strategy to preserve and grow business

3.1 Proposed Old Mutual Transaction structure
See graph in press announcement

3.2 Black shareholding as a result of the Old Mutual Transaction
As part of Old Mutual Namibia's ongoing commitment to transformation, Old
Mutual Namibia is proposing a number of schemes aimed at benefiting a wide
group of stakeholders including employees and management, distributors, trade
union members and their families, communities, Strategic Business Partners and
Strategic Community Partners.

Shares in Old Mutual plc, the UK-listed entity, will be issued in order to
facilitate the Old Mutual Transaction. Old Mutual Namibia is a 100% held
Namibian subsidiary of Old Mutual plc.

The value of the shares to be issued in respect of the various employee and
management schemes and to the various SPVs who are party to the Old Mutual
Namibia Transaction total N$220.46m, which represents 13.36% of the value of
Old Mutual Namibia.

The Initial Market Value will be N$21.64 per share, which represents the 10- day
volume weighted average price of Old Mutual plc shares to 31 August 2006 on the
LSE converted to Namibian dollars, less any dividend per share (in Namibian
dollars), that Old Mutual plc may declare in respect of its interim results to
30 June 2006. As Old Mutual plc has yet to release its interim results and
therefore no announcement has been made regarding the dividend per share that
Old Mutual plc may declare in respect of its interim results to 30 June 2006,
the number of shares to be issued has yet to be finally determined. Based on the
10-day volume weighted average price of N$21.64 per share, ignoring any interim
dividend, the number of shares to be issued will equal approximately 0.20% of
Old Mutual plc's current issued share capital.

The table below sets out the total deal size as well as the black ownership at
Old Mutual Namibia using Old Mutual plc shares to facilitate the Old Mutual
Transaction:

                           Using Old Mutual plc shares            At Old Mutual
                                                                  Namibia level
                                               Total                      Black
                                                deal                  ownership
                                                                   Shareholding
                                    Issue               Deal        (post-issue
                                    value              value     of new shares)
                                      N$m                 £m                  %
Employee and
Management Schemes                  66.96               4.95               4.01
Old Mutual Namibia
Management Scheme                   47.67               3.53               2.89
Old Mutual Namibia
Senior Black
Management Scheme                   15.83               1.16               0.96
Old Mutual Namibia
Broad-based Scheme                   3.46               0.26               0.16
Strategic Business
Partners                            33.75               2.50               2.05
Central Investment                  20.00               1.48               1.21
Manmar                               7.50               0.56               0.46
Northern Empowerment
Investments                          6.25               0.46               0.38
Strategic Community
Partners                            12.50               0.93               0.76
WAD                                  6.25               0.46               0.38
Churches                             6.25               0.46               0.38
Black Distributors Trust            35.00               2.59               2.12
Education Trust                     40.00               2.96               2.42
Long-term Strategic
Allocation                          32.25               2.39               1.95
Total                              220.46              16.32              13.31

Notes:
1. Exchange rate ZAR1:N$1/£1:N$13.5126 (weighted average exchange rate from
25 August to 31 August 2006).
2. Total effective new shareholding in Old Mutual Namibia post-issue of new
shares, is 13.36% with effective black ownership in Old Mutual Namibia post-
issue of new shares being 13.31%.
3.3 The Old Mutual Namibia Employee and Management Component (worth 4.06% of
Old Mutual Namibia)

Old Mutual Namibia firmly believes that its employees and management are
critical catalysts in transforming its business. Allocations to Old Mutual
Namibia employees and management will be made under the existing management
scheme established at the time of the South African BEE transaction. Three
different components are planned for Namibian employees and management:

3.3.1 The Old Mutual Namibia Management Component (2.89% of Old Mutual
Namibia)

The existing Old Mutual Management Scheme's primary purpose is to attract,
reward and retain senior and middle management. Old Mutual plc will issue new
ordinary shares to the Old Mutual Management Scheme share trust which is a new
employee share trust that will be funded by employer companies within Old
Mutual Namibia. The Old Mutual Namibia Management Scheme share trust will own
shares in Old Mutual plc at a deal value of N$47.67m (£3.53m) (which equates
to 2.89% of Old Mutual Namibia).

This new employee share trust will be used to fund the long-term share
incentives that Old Mutual Namibia expects to allocate to black management in
the normal course of business until 2016. By reserving a significant portion
of the Old Mutual plc shares for black management, Old Mutual Namibia is
demonstrating its unequivocal commitment to transform its business
fundamentally.

Share allocations for white management will also be made in terms of the Old
Mutual Management Scheme, but will only be matched by the existing employee
share trust at the time that the allocations are made.

Shares will be allocated in terms of Old Mutual's current allocation policy,
subject to regular market testing and individual performance. The current
policy is to make allocations in a combination of Restricted Share Plan
('RSP') share awards and share options. The RSP share awards will vest
immediately (subject to the condition that the participant remains employed by
Old Mutual Namibia for a period of time), while the share options will be
exercisable after three years (and expire after six years).

Participants are to be paid the dividends in respect of the RSP share awards
and will be entitled to exercise the voting rights in respect of the relevant
Old Mutual plc shares, but will have no dividend or voting rights in respect
of the unexercised share options.

3.3.2 The Old Mutual Namibia Senior Black Management Component (0.96% of Old
Mutual Namibia)
Senior black management employed by Old Mutual Namibia will participate in the
existing Old Mutual senior black management scheme. A new trust will be formed
to operate the scheme.

Old Mutual plc will issue new ordinary shares to this trust, to be funded by
means of a grant, from employer companies within the Old Mutual Group such

that the trust will own shares in Old Mutual plc at a deal value of N$15.83m
(£1.16m) (which equates to 0.96% of Old Mutual Namibia).

The trustees, on instruction from the Old Mutual plc Remuneration Committee,
will make awards to existing and future participants. The scheme will comprise
a once-off allocation with the possibility of an increase in allocation on
promotion. This allocation will be in addition to the normal allocations made
in terms of the Old Mutual Management Scheme and will be made by means of RSP
share awards over Old Mutual plc shares.

The RSP share awards will vest immediately but participants will only take
delivery of the relevant Old Mutual plc shares after three years (one-third),
four years (one-third) and five years (one-third).

The RSP share awards will be based on individual performance and subject to a
multiple of annual remuneration with participants having to remain in Old
Mutual Namibia's employment for a period of time.

3.3.3 Old Mutual Namibia Broad-based Component (0.21% of Old Mutual Namibia)
All Old Mutual Namibia employees who do not participate in any other share
scheme of the Group will participate in the existing Old Mutual Broad-based
Scheme. This scheme will thus operate for the benefit of both black and white
employees employed by Old Mutual Namibia, 75% of which are black. The same
trust that operates the Old Mutual Namibia Senior Black Management Component
will operate the Old Mutual Namibia Broad-based Component. This trust will own
shares in Old Mutual plc at a deal value of N$3.46m (£0.26m) (which equates to
0.21% of Old Mutual Namibia), to be funded from employer companies within the
Old Mutual Namibia Group.

An RSP share award of N$8 000 (£592) per employee will be made upfront to all
qualifying employees, subject to a five-year delivery period.

3.4 Old Mutual Namibia Distributor Schemes (2.12% of Old Mutual Namibia)
The Old Mutual Namibia Distributor Scheme allows Old Mutual Namibia to
demonstrate its commitment to its current and future black distributors.

The objective of the Black Distributors Trust will be to provide or secure
finance for black brokers and agents, as well as distribution businesses owned
and managed by black Namibians. The finance or security made available by the
trust will be utilised by such black distributors to acquire assets required
in order to commence operations in a productive manner.

The SPV owned by the trust will acquire shares in Old Mutual plc at a deal
value of N$35.00m (£2.59m) (which equates to 2.12% of Old Mutual Namibia).

There is a clear and present need for the development of a network of black
distributors in order to serve previously underserved markets. The Black
Distributors Trust will assist black distributors to acquire relevant
operational assets (which are often hard to obtain especially given the
variable nature of distribution income) and will ensure and fast track the
productive entry by black distributors into the market.

The Black Distributors Trust will be funded using the same funding mechanism
as the Strategic Business Partners as detailed in paragraph 3.7 below.

3.5 Old Mutual Namibia Education Trust (2.42% of Old Mutual Namibia)
The Old Mutual Namibia Education Trust allows Old Mutual Namibia to
demonstrate its commitment to its trade union customer base.

Complementing Old Mutual Namibia's current focus on training and education,
the purpose of the Education Trust is to provide meaningful benefits to black
trade union members who are clients and important stakeholders of Old Mutual
Namibia. The SPV owned by the trust will acquire shares in Old Mutual plc to a
deal value of N$40.00m (£2.96m) (which equates to 2.42% of Old Mutual
Namibia). The Education Trust will be established in conjunction with
NedNamibia Holdings.

The overall focus of the Education Trust will be to assist with the education
needs of black members of participating unions. Given the need for and
importance of education in Namibia, especially amongst the black communities,
the Education Trust will provide tertiary education scholarships to black
members of participating unions and their dependents.

A number of trade unions with which Old Mutual Namibia has business
relationship will be invited to participate in the initiative and black
members of such participating unions will benefit directly from the Education
Trust. The following trade unions, which represent a membership of more than
600 000, have already registered their support for the Education Trust
initiative:

- Mine Workers' Union of Namibia (MUN);
- Metal and Allied Namibian Workers' Union (MANWU);
- Teachers' Union of Namibia (TUN);
- Namibia Food and Allied Workers' Union (NAFAU);
- Public Service Union of Namibia (PSUN);
- National Union of Namibian Workers (NUNW);
- Namibia Transport and Allied Workers' Union (NATAU);
- Namibia National Teachers' Union (NANTU);
- Namibia Public Workers' Union (NAMPWU); and
- Namibia Financial Institutions Union (NAFINU).

The Education Trust will be funded using the same funding mechanism as the
Strategic Business Partners as detailed in paragraph 3.7 below.

3.6 Old Mutual Namibia Strategic Business Partners and Strategic Community
Partners (2.81% of Old Mutual Namibia)

The Strategic Business Partners and Strategic Community Partners will acquire
shares in Old Mutual plc at a deal value of N$46.25m (£3.42m), representing
2.81% of the value of Old Mutual Namibia and will be funded on the basis
detailed in paragraph 3.7 below.

3.7 Mechanism to implement the Old Mutual Transaction
For Old Mutual Namibia employees and management components, black-controlled
trusts will be created and funded directly by Old Mutual Namibia employer
companies.

For all the other schemes, the Old Mutual plc shares will be issued to eight
Namibian incorporated SPVs (set up for and wholly owned by each of the Old
Mutual Namibia Black Distributors Trust, the Old Mutual and Nedbank Namibia
Education Trust, Long-term Strategic Allocation, Central Investment, Manmar,
Northern Empowerment Investments, WAD and the Churches consortium,
respectively) in consideration for the Namibian dollar equivalent of 10 pence
per share (the par value of the Old Mutual plc shares) in cash (paid on or
before the completion date on which the shares are issued) and an undertaking
given by the SPVs to pay the Interim Payments (as defined below) and to make a
cash payment (in Namibian dollars) to Old Mutual plc on 31 December 2016
determined according to a set formula (the 'cash undertaking'). These amounts
will together form the subscription price for the new Old Mutual plc shares.
The Strategic Business Partners will each make a capital contribution of 2.5%
of the value of the shares to the relevant Namibian SPVs, with the balance of
the par value funded by the SPVs from Namibian dollar denominated loans. In
the case of the SPVs owned by the Strategic Community Partners, Black
Distributors Trust and the Education Trust, Namibian dollar denominated loans
will fund the entire par value.

Dividends received by the SPVs from their holdings of Old Mutual plc shares
and the major portion of the performance fees earned by the Strategic Business
Partners and Strategic Community Partners and injected into the SPVs as
capital contributions, will be used first to repay the third party loans (in
the case of the Black Distributors Trust and the Education Trust, a portion of
these dividends will be applied to fund the objectives of these trusts) and
thereafter such amounts (the 'Interim Payments') will be paid to Old Mutual
plc towards satisfaction of the SPVs' obligations under the cash undertaking
(part of the subscription price).

The payment by the SPV due on 31 December 2016 to discharge the balance of the
cash undertaking will be (subject to a minimum of one Namibian dollar) the
lesser of:

- the difference between the Initial Market Value as described in paragraph
3.2 above and the Namibian dollar equivalent of 10 pence par value per share
multiplied by the number of shares issued to the relevant SPV plus an
escalation factor and less any amounts paid by the SPVs in partial
satisfaction of the undertaking. This amount will be calculated on an annual
basis and will be increased annually by 2.5% of the Initial Market Value
(except in the case of the Education Trust and Distributors Trust SPVs); and

- the Namibian dollar equivalent of the market value of the Old Mutual plc
shares at the highest price quoted on the LSE during the period between
1 September 2016 and the business day before 31 December 2016 multiplied by
the number of shares issued to the relevant SPV.
The funding structure is similar to that in the South African BEE transaction.
The table below displays the salient features of the terms of the share
issues:

                         Black                         Strategic     Strategic
                  Distributors        Education         Business     Community
                         Trust            Trust         Partners      Partners
Issue price
of shares        Par value and    Par value and    Par value and Par value and
              cash undertaking cash undertaking cash undertaking          cash
undertaking
Upfront amount                                     2.5% of value
paid by SPV                Nil              Nil        of shares           Nil
Date on
which cash
undertaking
is                 31 December      31 December      31 December   31 December
payable                   2016             2016             2016          2016
Escalation
factor
(fixed)
on cash
undertaking              9.73%             9.73%           9.73%         9.73%

3.8 Value of the Old Mutual Transaction
The value of Old Mutual Namibia Transaction is based on the valuation of Old
Mutual Namibia. The value of Old Mutual Namibia has been derived at N$1 650m
(£122.11m) for this business, which translates into approximately 1.40% of the
market capitalisation of Old Mutual plc.

3.9 Estimated economic cost of the Old Mutual Transaction
The estimated economic cost of the Old Mutual Transaction to Old Mutual is
N$57.31 (£4.24m). This translates into 3.47% of the value of Old Mutual
Namibia.

3.10 Measuring the black ownership of the Old Mutual Transaction

                                                             N$m            £m
Value of Old Mutual Namibia                             1 650.00        122.11
Value of Old Mutual Namibia Transaction                   220.46         16.32
Less: White employee component of Old Mutual
Namibia Broad-based Scheme                                  0.87          0.06
Black ownership portion of Old Mutual Transaction         219.59         16.26
Black ownership portion of Old Mutual Transaction
as a % of the value of Old Mutual Namibia                 13.31%

Note: Exchange rate £1:N$13.5126.

3.11 Conditions precedent to the Old Mutual Transaction
The conditions precedent to the Old Mutual plc shares being issued include the
following:

- no breach of certain clauses of the subscription agreement having been
committed by any SPV or any of Central Investment, Manmar and Northern
Empowerment Investments and any of the Strategic Community Partners;

- funding is obtained by Central Investment, Manmar and Northern Empowerment
Investments to fund the payment of the balance of the par value of the Old
Mutual plc shares;

- the admission of the Old Mutual plc shares to the Official List of the LSE
in accordance with paragraph 7.1 of the UK Listing Rules and the admission of
the shares to trading becoming effective in accordance with paragraph 2.1 of
the Admission and Disclosure Standard produced by the LSE;

- the adoption by the SPVs, their holding companies or the shareholders (as
the case may be) of their constitutional documents and any shareholders'
agreement in such form as Old Mutual plc may approve in writing;

- the approval of the transaction by the Bank of Namibia and other relevant
authorities;

- any other regulatory approvals required by Old Mutual plc or the SPVs in
order to implement the Old Mutual Transaction; and

- Old Mutual plc being satisfied that each feature of the Nedbank Group
Transaction and Mutual & Federal Transaction shall have received all consents,
sanctions and approvals to which such feature is subject and that such feature
will be implemented in accordance with its terms. Old Mutual plc can waive
this condition in whole or in part. If any of the conditions precedent are not
fulfilled or (where capable) waived on or before 31 December 2006 (or such
later date as the partner may agree) either Old Mutual plc or the relevant SPV
may terminate the Subscription Agreements.

Transaction advisor to Old Mutual plc
NEDBANK CAPITAL

Sponsor to Old Mutual plc
Merrill Lynch International
Registered in England
Registration number 231079
Regulated in the United Kingdom by The Financial Sercvices Authority

Corporate law advisors to Old Mutual plc
EDWARD NATHAN (Proprietary) Limited
Registration No. 2004/005665/07

Legal advisors as to English law to Old Mutual plc
SLAUGHTER AND MAY

NEDBANK GROUP

• Resultant black ownership at 11.13% in NedNamibia Holdings
• Key black shareholders include: Employees and management; Strategic Business
Partners; Strategic Community Partners and
an Education Trust
• Benefits 381 black Namibian employees
• Performance agreements with broad-based Strategic Business Partners and
Strategic Community Partners
• Aligned with empowerment strategy to preserve and grow business

Key features:
• Resultant black ownership at 11.13% in NedNamibia Holdings
• Key black shareholders include: Employees and Management, Strategic Business
Partners, Strategic Community Partners and an Education Trust
• Benefits 381 black Namibian employees
• Performance agreements with broad-based Strategic Business Partners and
Strategic Community Partners
• Aligned with empowerment strategy to preserve and grow business

Following the conclusion of the Transaction, Nedbank Group will initiate a
process to list Nedbank Group on the Namibian Stock Exchange ('NSX') in order
to facilitate easier trade in Nedbank Group shares within Namibia.

4.1 Proposed Nedbank Group Transaction structure
See graph in press announcement

4.2 Black shareholding as a result of the Nedbank Group Transaction
Nedbank Group is pleased to announce that, as part of its ongoing programme of
transformation, and subject to the fulfilment of the conditions precedent set
out in paragraph 4.12 below, Nedbank Group is proposing the introduction of
broad-based black ownership into its 94% held Namibian subsidiary, NedNamibia
Holdings. NedNamibia Holdings is the vehicle through which Nedbank Group
conducts its business in Namibia. The introduction of broad-based black
ownership into NedNamibia Holdings will be by way of the issue of new ordinary
shares in the share capital of Nedbank Group ranking pari passu in all
respects with the existing issued ordinary shares of Nedbank Group.
Accordingly, a diverse group of black stakeholders consisting of Employees and
Management, Strategic Business Partners, Strategic Community Partners and an
Education Trust have been selected to participate as shareholders.

The proposed transaction achieves strong alignment with the overall strategic
objectives of NedNamibia Holdings in a number of key respects. These include:

- positioning of Nedbank Namibia as a bank which is accessible to all
Namibians;

- repositioning of the Nedbank brand in the retail segment with a potential
increase in retail clients in Namibia;

- assisting in the attainment of employment equity targets, particularly at
senior employee levels;

- repositioning the bank internally and culturally to better serve the
requirements of a changing external market;

- growing market share in the Namibian public sector;

- protecting existing business and market share by meeting and exceeding the
ownership and control requirements of the impending Namibian FSC;

- participating in a meaningful way in the development of emerging BEE
corporates and securing future growth together with these corporates; and

- aligning with Nedbank Group's overall goals of promotion of women's
interests.

The table below sets out the total deal size at Nedbank Group as well as the
effective black ownership at NedNamibia Holdings utilising the enlarged issued
share capital of Nedbank Group to facilitate the Nedbank Group Transaction:

                                    Using Nedbank Group shares
                                                                  Effective
                                            Shareholding              Black
                                                      in       ownership in
                                                 Nedbank         NedNamibia
                           Total deal              Group           Holdings
                                            Shareholding       Shareholding
                Number           Deal     (post-issue of     (post-issue of
             of shares          value        new shares)        new shares)
                             (N$m/Rm)                  %                  %
Employee and
Management
Schemes        211 283          21.40               0.05               3.47
NedNamibia
Holdings
Long-term
Incentive
Plan            81 749           8.28               0.02               1.38
NedNamibia
Holdings
Black
Management
Scheme          95 176           9.64               0.02               1.61
NedNamibia
Holdings
Broad-based
Scheme          34 358           3.48               0.01               0.48
Strategic
Business
Partners       199 929          20.25               0.04               3.37
Central
Investment     118 476          12.00               0.02               2.00

Manmar          44 429           4.50               0.01               0.75
Northern
Empowerment
Investments     37 024           3.75               0.01               0.62
Strategic
Community
Partners        74 048           7.50               0.02               1.24
WAD             37 024           3.75               0.01               0.62
Churches        37 024           3.75               0.01               0.62
Education
Trust           98 730          10.00               0.02               1.67
Long-term
Strategic
Allocation      81 452           8.25               0.02               1.38
Total          665 442          67.40               0.15              11.13

Notes

1. Exchange rate: ZAR1:N$1.
2. Total new effective shareholding in NedNamibia Holdings post-issue of new
shares, is 11.23% with effective Black ownership in NedNamibia Holdings, post-
issue of new shares, being 11.13%.
3. The number of shares was calculated using the 10-day volume weighted
average price (ex dividend) to 31 August 2006 of R101.29 per share.

4.3 The NedNamibia Holdings Employee and Management Schemes
(3.47% of NedNamibia Holdings)
NedNamibia Holdings Employee and Management schemes are comprised of three
elements, details of which appear below:

4.3.1 The NedNamibia Holdings Long-term Incentive Plan (1.38% of NedNamibia
Holdings)
The NedNamibia Holdings Long-term Incentive Plan ('LTIP') will operate for the
benefit of permanent employees, both black and white, presently earning in
excess of N$289 454 per annum. Allocations will be made on appointment and on
an annual basis. The LTIP will comprise two components, namely, a share option
element and a Restricted Share Plan component. Participation in the LTIP will
be based on individual performance ratings and subject to any additional
criteria deemed fit by the NedNamibia Holdings Executive Committee and subject
to the approval of the Nedbank Group Remuneration Committee. Options will vest
after three years and participants will have five years from date of issue in
which to exercise their options. The LTIP is being introduced as NedNamibia
Holdings did not previously have a long-term incentive plan in place and to
enable its employment policies to be in line with those of Nedbank Group. The
LTIP size shown in the table above relates only to the black component of the
scheme.

4.3.2 The NedNamibia Holdings Black Management Scheme (1.61% of NedNamibia
Holdings)
The NedNamibia Holdings Black Management Scheme will operate for the benefit
of black senior and middle management of NedNamibia Holdings presently earning
more than N$289 454 per annum. Nedbank Group will issue new ordinary shares to
the NedNamibia Black Management Scheme Trust ('the Management Trust') partly
on a grant basis (50%) and partly on an interest-free loan basis (50%), such
that the Management Trust will own approximately 0.02% of the enlarged issued
share capital of Nedbank Group (which equates to 1.61% of NedNamibia
Holdings).
The trustees, on instruction from the NedNamibia Holdings Remuneration

Committee, will make awards to existing and future qualifying participants for
retention and attraction purposes, respectively. Awards will be made on a
once-off basis to qualifying existing black employees and on appointment to
qualifying future employees and will be subject to four, five and six-year
vesting periods in equal tranches.

4.3.3 The NedNamibia Holdings Broad-based Scheme (0.58% of NedNamibia
Holdings)
The NedNamibia Holdings Broad-based Scheme will operate for the benefit of all
qualifying employees of NedNamibia Holdings who do not participate in any
other share scheme. This scheme will thus operate for the benefit of both
black and white employees of NedNamibia Holdings. 82% of the scheme
participants will be black. The NedNamibia Holdings; Broad-based Scheme will
own approximately 0.58% of the value of NedNamibia Holdings (black
participation equates to 0.48% of NedNamibia Holdings). An award of N$8 000
per employee will be made upfront to all qualifying participants, subject to
fulfilment of a five-year holding period.

4.4 NedNamibia Holdings Strategic Business Partners (3.37% of NedNamibia
Holdings)
Central Investment, Manmar and Northern Empowerment Investments will,
collectively, acquire an effective 0.04% of the enlarged issued share capital
of Nedbank Group (which equates to 3.37% of the value of NedNamibia Holdings),
which will be funded on the basis as detailed in paragraph 4.7 below.

To this end, Central Investment, Manmar and Northern Empowerment Investments
have each entered into a detailed Subscription Agreement with Nedbank Group
and a detailed Performance Agreement with NedNamibia Holdings setting out the
terms of their participation as well as related performance criteria together
with the implications of not meeting or exceeding those criteria.

4.5 NedNamibia Holdings Strategic Community Partners (1.24% of NedNamibia
Holdings)
The Strategic Community Partners, namely WAD and the churches will,
collectively, acquire an effective 0.02% of the enlarged issued share capital
of Nedbank Group (which equates to 1.24% of NedNamibia Holdings), which will
be funded on the basis as detailed in paragraph 4.7 below.

To this end, WAD and the churches have each entered into detailed Subscription
Agreements with Nedbank Group and detailed Performance Agreements with
NedNamibia Holdings, setting out the terms of their participation as well as
related performance criteria together with the implications of not meeting or
exceeding those criteria.

4.6 Education Trust (1.67% of NedNamibia Holdings)
In recognition of the role played by certain trade unions and other groups in
the Namibian economy and the potentially positive influence of these groups on
the business of NedNamibia Holdings, an Education Trust will be established in
conjunction with Old Mutual Namibia which will have an initial duration of ten
years. Due to the importance of education in Namibia amongst the black
communities, the Education Trust will provide meaningful benefits to members
of such groups and complement the community focus of the Group's Namibian
businesses on training and education. More detail on this trust has been dealt
with in paragraph 3.5 above. The Education Trust will subscribe for Nedbank
Group shares with a value of N$10 million, which is equivalent to 1.67% of the
value of NedNamibia Holdings. The trust will be funded on the basis described
in paragraph 4.7 below.

4.7 Mechanism to implement the Nedbank Group Transaction
For the NedNamibia Holdings Employee and Management schemes, black-controlled
employee trusts will be created and funded by Nedbank Group or its subsidiary,
either by way of an interest-free loan or a grant as discussed in paragraph

4.3 above. Dividends will be applied to paying down the capital portion of the
loan, or distributed to beneficiaries in the case of grant-funded shares. Cash
received on the exercise of share options will be applied to paying down the
capital portion of the loan.

For all the other schemes, Nedbank Group has developed a mechanism which
involves Nedbank Group issuing the scheme shares at or about par value to the
various scheme participants. On the applicable termination dates for each
scheme, Nedbank Group will be entitled to call back as many of the scheme
shares as, based on their then market value, equate in value to the terminal
balance of a notional calculation model. The notional calculation model will
calculate at pre-agreed notional rates.

Further detail on the proposed structure will be furnished to shareholders in
the circular to shareholders, but the essential features of the structure are:

- creation of separate black-controlled vehicles as appropriate for the
respective participants ('SPVs');

- the subscription by those SPVs for ordinary shares in Nedbank Group at par
value of R1.00 per share (in the case of the Strategic Business Partner SPVs,
at a small premium to par value representing a 2.5% initial contribution by
the Strategic Business Partners). The par value payment in respect of the
Strategic Community Partner SPVs and the Education Trust will be funded by way
of separate loans;

- the grant to Nedbank Group of a call option against the SPVs for a number of
Nedbank Group ordinary shares, determined by formula, held in the SPVs,
exercisable on the termination date of the particular scheme at the same price
per share at which the shares were issued to the SPVs;

- the SPVs will be granted a call option to acquire the same number of shares
as acquired by Nedbank Group exercising its call option at the then market
value; and

- the effective obligatory re-investment of cash receipts (dividends and a
portion of performance fees in the case of Strategic Business Partners and
Strategic Community Partners and dividends only in the case of the Education
Trust) by recipients into Nedbank Group shares. In the case of dividends,
Nedbank Group will, through the period of the schemes, undertake semi-annual
capitalisation awards with a cash dividend election and the participants will
waive their cash dividend election upfront. In the case of performance fees,
the Strategic Business Partners and Strategic Community Partners will be
obliged to re-invest a portion in subscribing for new Nedbank Group shares.

The funding structure is similar to that in the South African BEE transaction.

4.8 Value of the Nedbank Group Transaction
The value of the Nedbank Group Transaction is based on the valuation of
NedNamibia Holdings. Nedbank Group shares will be issued in respect of the
Transaction using the 10-day volume weighted average price (ex dividend) to 31
August 2006 of R101.29 per share.

4.9 Estimated economic cost of the Nedbank Group Transaction
The estimated economic cost of the Nedbank Group Transaction to Nedbank Group
is R24.75 million. This translates into 0.05% of the value of Nedbank Group.

4.10 Pro forma financial effects of the Nedbank Group Transaction
The Nedbank Group Transaction does not on a consolidated basis reduce Nedbank
Group's consolidated Basic EPS and Headline EPS for the year ended 31 December
2005 and the interim period ended 30 June 2006 by more than 0.9%, The IFRS
share-based payments charge in respect of the transaction amounts to R14.88
million.

4.11 Measuring the black ownership of the Nedbank Group Transaction
                                                                N$m/Rm
Value of NedNamibia Holdings                                    600.00
Value of Nedbank Group Transaction                               67.40
Less: White employee component of NedNamibia Holdings
Broad-based Scheme                                              (0.63)
Black ownership portion of Nedbank Group Transaction             66.77
Black ownership portion of Nedbank Group Transaction as a
percentage of the value of NedNamibia Holdings                  11.13%

4.12 Conditions precedent to the Nedbank Group Transaction
The implementation of the Nedbank Group Transaction is subject to the
fulfilment of the following conditions precedent:

- approval by the requisite majority of Nedbank Group shareholders in general
meeting to the issue of new Nedbank Group shares to each of the SPVs. In this
regard, the required circular is expected to be posted to ordinary
shareholders of Nedbank Group in due course; and

- obtaining of the necessary regulatory approvals.

4.13 Opinions and recommendations for the Nedbank Group Transaction
4.13.1 Directors' recommendation
The board of Nedbank Group recommend that the shareholders of Nedbank Group
vote in favour of the Nedbank Group Transaction and the resolutions to be
proposed at the general meeting to be held to consider the Nedbank Group
Transaction. In respect of their beneficial holdings in Nedbank Group, the
relevant board members intend to vote in favour of the resolutions to be
proposed at the aforementioned general meeting.

4.13.2 Position of Old Mutual plc
Old Mutual plc (a 51.02% shareholder in Nedbank Group) intends voting its
shares in favour of the Nedbank Group Transaction and the resolutions to be
proposed at the general meeting of Nedbank Group shareholders to be held to
consider the Nedbank Group Transaction.

4.14 Timetable and documentation
Nedbank Group shareholders will be advised in due course as to the important
dates and times relevant to the Nedbank Group Transaction. A circular setting
out the full details of the proposed introduction of direct black ownership,
including details of the Nedbank Group Transaction and the meetings required
to implement it will be forwarded to shareholders in due course.

Transaction advisor and sponsor to Nedbank Group
NEDBANK CAPITAL

Sponsor to Nedbank Group
Merrill Lynch South Africa (Pty) Ltd
Registration number 1995/001805/07
Registered Sponsor and Member of the JSE Limited

Corporate law advisors to Nedbank Group
EDWARD NATHAN (Proprietary) Limited
Registration No. 2004/005665/07

MUTUAL & FEDERAL

• Resultant black ownership of 11.42% in Mutual & Federal Namibia
• Key black stakeholders include:
Employees and Management, Strategic Business Partners and Strategic Community
Partners
• Aimed at 60 black employee participants
• Performance agreements with broad-based Strategic Business Partners and
Strategic Community Partners
• Aligned with empowerment strategy to preserve and grow business

Key features:
• Resultant black ownership of 11.42% in Mutual & Federal Namibia
• Key black shareholders include: Employees and Management, Strategic Business
Partners and Strategic Community Partners
• Aimed at 60 black employee participants
• Performance agreements with broad-based Strategic Business Partners and
Strategic Community Partners
• Aligned with empowerment strategy to preserve and grow business

5.1 Proposed Mutual & Federal Transaction structure
See graph in press announcement.

5.2 Black shareholding in Mutual & Federal Namibia as a result of the Mutual &
Federal Transaction

Mutual & Federal is pleased to announce that, as part of its ongoing
commitment to transformation of its Namibian business, and subject to the
fulfilment of the conditions precedent set out in paragraph 5.9 below, Mutual
& Federal is proposing the introduction of broad-based black ownership into
Mutual & Federal Namibia by way of the issue of new ordinary shares in the
share capital of Mutual & Federal ranking pari passu in all respects with the
existing issued ordinary shares of Mutual & Federal.

The table below sets out the total deal size at Mutual & Federal as well as
the effective black ownership at Mutual & Federal Namibia utilising the
enlarged issued share capital of Mutual & Federal to facilitate the Mutual &
Federal Transaction:
                                               Using Mutual & Federal shares
                                                                      Effective
                                                  Shareholding            Black
                                                            in     ownership in
                                                      Mutual & Mutual & Federal
                                     Total deal        Federal          Namibia
                                                  Shareholding     Shareholding
                           Number          Deal (post-issue of   (post-issue of
                        of shares         value    new shares)      new shares)
                                       (N$m/Rm)              %                %
Employee and Management
Schemes                   279 157         7.58            0.10             4.25
Mutual & Federal
Management
Scheme                    142 746         3.88            0.05             2.28
Mutual & Federal
Senior Black
Management Scheme         110 484         3.00            0.04             1.77
Mutual & Federal
Broad-based Scheme         25 927         0.70            0.01             0.20
Strategic
Business Partners         248 590         6.75            0.09             3.97
Central Investment        147 313         4.00            0.05             2.35
Manmar                     55 242         1.50            0.02             0.88
Northern Empowerment
Investments                46 035         1.25            0.02             0.74
Strategic
Community Partners         92 070         2.50            0.04             1.46
Churches                   46 035         1.25            0.02             0.73
WAD                        46 035         1.25            0.02             0.73
Long-term Strategic
Allocation                108 864         2.96            0.03             1.74
Total                     728 681        19.79            0.26            11.42

Notes:
1. Exchange rate: ZAR1:N$1.
2. Total new effective shareholding in Mutual & Federal Namibia, post-issue
of new shares, is 11.64% with effective Black ownership in Mutual & Federal
Namibia post-issue of new shares being 11.42%
3. The number of shares was calculated using the 10-day volume weighted
average price (ex dividend) to 31 August 2006 of R27.15 per share.

5.3 Mutual & Federal Namibia Employee and Management Schemes
The Mutual & Federal Namibia Employee and Management schemes comprise three
different elements:

5.3.1 Mutual & Federal Namibia Management Scheme (2.28% of Mutual & Federal
Namibia)
Mutual & Federal will issue new ordinary shares to a new employee share trust
which will be funded by interest-free loans and/or grants from Mutual &
Federal, the purpose of which is to attract, reward and retain senior and
middle management in its Namibian business. The new employee share trust will
own 0.05% of the enlarged issued share capital of Mutual & Federal.

This new employee share trust will be used to fund the long-term share
incentives that Mutual & Federal Namibia expects to allocate to black
management in the normal course of business until 2016. By reserving a
significant portion of the Mutual & Federal shares for black management,
Mutual & Federal is demonstrating its unequivocal commitment to transform its
Namibian business fundamentally.

Shares will be allocated in terms of Mutual & Federal's current allocation
policy subject to regular market testing and individual performance. The
current policy is to make allocations in a combination of Restricted Share
Plan ('RSP') share awards and share options. The RSP share awards will vest
immediately (subject to the condition that the participant remains in Mutual &
Federal Namibia's employment for a period of time), while the share options
will be exercisable commencing after three years (but within six years).
Participants are to be paid the dividends in respect of the RSP share awards
and will be entitled to exercise the voting rights in respect of the relevant
Mutual & Federal shares, but will have no dividend or voting rights in respect
of the unexercised share options. Accordingly, the entire interest of 2.28% in
Mutual & Federal shares held by the new employee share trust will count for
black ownership.

5.3.2 Mutual & Federal Namibia Senior Black Management Scheme (1.77% of Mutual
& Federal Namibia)
The Mutual & Federal Namibia Senior Black Management Scheme will operate for
the benefit of selected senior black management of Mutual & Federal Namibia.

A new trust will be formed to operate the Mutual & Federal Namibia Senior
Black Management Scheme. This new trust will acquire upfront 0.04% of the
enlarged issued share capital of Mutual & Federal and will be funded by means
of a grant from Mutual & Federal.

The trustees, on instruction from the Mutual & Federal Namibia Remuneration
Committee, will make awards to existing (25%) and future (75%) participants
for retention and attraction purposes, respectively. The scheme will comprise
a once-off allocation with the possibility of an increase on promotion. This
allocation will be in addition to the normal allocations made in terms of the
Mutual & Federal Namibia Management Scheme and will be made by means of an RSP
award.

5.3.3 Mutual & Federal Namibia Broad-based Scheme (0.41% of Mutual & Federal
Namibia)
This scheme will operate for the benefit of all employees of Mutual & Federal
Namibia who do not participate in either the management scheme or the Mutual &
Federal Namibia Senior Black Management Scheme. This scheme will thus operate
for the benefit of both black and white employees employed by Mutual & Federal
Namibia, of which 47% are black. The allocation will be made by means of an
RSP share award over Mutual & Federal shares of N$8 000 per participant.

The same trust that operates the Mutual & Federal Namibia Senior Black
Management Scheme will operate the Mutual & Federal Namibia Broad-based
Scheme. The trust will acquire upfront 0.01% of the enlarged issued share
capital of Mutual & Federal and will be funded by means of a grant from Mutual
& Federal.

5.4 Mutual & Federal Namibia Strategic Business Partners (3.97% of
Mutual & Federal Namibia)
Central Investment, Manmar and Northern Empowerment Investments will each
acquire an effective 0.05%, 0.02% and 0.02%, respectively, of the enlarged
issued share capital of Mutual & Federal (which equates to 3.97% in aggregate
of the value of Mutual & Federal Namibia), which will be funded on the basis
as detailed in paragraph 5.6 below.

To this end, Central Investment, Manmar and Northern Empowerment Investments
have each entered into a detailed Subscription Agreement with Mutual & Federal
and a detailed Performance Agreement with Mutual & Federal Namibia setting out
the terms of their participation as well as related performance criteria
together with the implications of not meeting or exceeding those criteria.

5.5 Mutual & Federal Namibia Strategic Community Partners (1.46% of Mutual &
Federal Namibia)
The Strategic Community Partners, namely WAD and the churches, will each
acquire an effective 0.02% of the enlarged issued share capital of Mutual &
Federal (which equates to 1.46% of Mutual & Federal Namibia), which will be
funded on the basis as detailed in paragraph 5.6 below.

To this end, WAD and the churches have each entered into detailed Subscription
Agreements with Mutual & Federal and detailed Performance Agreements with
Mutual & Federal Namibia setting out the terms of their participation as well
as related performance criteria together with the implications of not meeting
or exceeding those criteria.

5.6 Mechanism to implement the Mutual & Federal Transaction
For the employee schemes, comprising 0.10% of the enlarged issued share
capital of Mutual & Federal, black-controlled employee trusts will be created
and will be funded, directly, by Mutual & Federal, either by way of an
interest-free loan or a grant as discussed in paragraph 5.3 above.
For the Strategic Business Partner scheme and Strategic Community Partner
scheme, comprising 0.09% and 0.04% of the enlarged issued share capital of
Mutual & Federal, respectively, Mutual & Federal has developed a mechanism
which involves Mutual & Federal issuing the scheme shares at or about par
value to the various scheme participants. On the applicable termination dates
for each scheme, Mutual & Federal will be entitled to call back as many of the
scheme shares as, based on their then market value, are equal in value to the
terminal balance on a notional calculation model. The notional calculation
model will calculate at pre-agreed notional rates.

Further detail on the proposed structure will be furnished in the circular to
shareholders, but the essential features of the Strategic Business Partner
scheme and Strategic Community Partner schemes are:

- creation of the separate black Namibian controlled vehicles as appropriate
for the respective participants ('SPVs');

- the subscription by the SPVs for ordinary shares in Mutual & Federal at par
value of 10 cents per share (in the case of the Strategic Business Partner
SPVs, at a small premium to par value representing a 2.5% initial contribution
by the Strategic Business Partners), in the case of the Strategic Community
Partners, the par value will be funded by way of separate loans;

- the grant to Mutual & Federal of a call option against the SPVs for a
formulaically determined number of Mutual & Federal ordinary shares held in
the SPVs, exercisable on the termination date of the particular scheme at the
same price per share at which the shares were issued to the SPVs;

- the SPVs will be granted a call option to acquire the same number of shares
as acquired by Mutual & Federal exercising its call option at the then market
value; and

- the effective obligatory re-investment of cash receipts (dividends and
portion of performance fees in the case of Strategic Business Partners and the
Strategic Community Partners) by recipients into Mutual & Federal shares. In
the case of dividends, Mutual & Federal will through the period of the
schemes, undertake semi-annual capitalisation awards with a cash dividend
election, and the SPVs, in the case of the Strategic Business Partners and the
Strategic Community Partners have waived 100% of their cash dividend election
upfront. In the case of performance fees, the Strategic Business Partners and
Strategic Community Partners will be obliged to re-invest a portion in
subscribing for new Mutual & Federal shares.

The funding structure is similar to that in the South African BEE transaction.

5.7 Value of the Mutual & Federal Transaction
The value of the Mutual & Federal Transaction is based on the valuation of
Mutual & Federal Namibia. Mutual & Federal shares will be issued using the 10
day volume weighted average price (ex dividend) to 31 August 2006, of R27.15
per share.

5.7.1 Estimated economic costs of the Mutual & Federal Transaction
Mutual & Federal has estimated the economic cost of the Mutual & Federal
Transaction to be R7.42 million. This translates to 0.07% of the value of
Mutual & Federal.

5.7.2 Pro forma financial effects of the Mutual & Federal Transaction
The Mutual & Federal Transaction does not on a consolidated basis, reduce
Mutual & Federal's consolidated Basic EPS and Headline EPS for the year ended
31 December 2005 and the interim period ended 30 June 2006 by more than 1.2%,
The IFRS share based payments charge in respect of the Mutual & Federal
Transaction amounts to R3.60 million

5.8 Measuring the black ownership of the Mutual & Federal Transaction
                                                                   N$m/Rm
Value of Mutual & Federal Namibia                                  170.00
Value of Mutual & Federal Transaction                               19.79
Less: white employee component of Mutual & Federal Namibia
Broad-based Scheme                                                 (0.37)
Black ownership portion of Mutual & Federal Transaction             19.42
Black ownership portion of Mutual & Federal Transaction as a
percentage of the value of Mutual & Federal Namibia                11.42%

5.9 Conditions precedent to the Mutual & Federal Transaction
The implementation of the Mutual & Federal transaction is subject to the
fulfilment of the following conditions precedent:

- approval by the requisite majority of Mutual & Federal ordinary shareholders
in general meeting of the issue of new Mutual & Federal shares to each of the
SPVs. In this regard, the required circular is expected to be posted to
ordinary shareholders of Mutual & Federal in due course; and

-obtaining of the necessary regulatory approvals.

5.10 Opinions and recommendations for the Mutual & Federal Transaction
5.10.1 Directors' recommendation
The board of Mutual & Federal recommend that the shareholders of Mutual &
Federal vote in favour of the Mutual & Federal Transaction and the resolutions
to be proposed at the general meeting to be held to consider the Mutual &
Federal Transaction. In respect of their beneficial holdings in Mutual &
Federal, the relevant board members intend to vote their shares in favour of
the Mutual & Federal Transaction and the resolutions to be proposed at the
aforementioned general meeting.

5.10.2 Position of Old Mutual plc
Old Mutual (SA) a 77% shareholder in Mutual & Federal intends voting its
shares in favour of the Mutual & Federal Transaction and the resolutions to be
proposed at the general meeting of Mutual & Federal ordinary shareholders to
be held to consider the Mutual & Federal Transaction.

5.11 Timetable and documentation
Mutual & Federal shareholders will be advised in due course as to the
important dates and times relevant to the Mutual & Federal Transaction. A
circular setting out the full details of the proposed introduction of direct
black ownership, including details of the Mutual & Federal Transaction and the
meetings required to implement it will be forwarded to shareholders in due
course.

Transaction advisor and sponsor to Mutual & Federal
NEDBANK CAPITAL

Sponsor to Mutual & Federal
Merrill Lynch South Africa (Pty) Ltd
Registration number 1995/001805/07
Registered Sponsor and Member of the JSE Limited

Corporate law advisors to Mutual & Federal
EDWARD NATHAN (Proprietary Limited)
Registration No. 2004/005665/07


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