Sanlam Namibia Active Fund

1 Fund ObjectiveThe Sanlam Namibia Active Fund`s objective is to provide a high level of incomeand to maximise returns over the medium to long term. The fund is activelymanaged and invests across the income-yielding universe, including fixed-interestsecurities, corporate and government bonds, preference shares, money-marketinstruments and listed property. Investors in this fund accept the aggressiveperformance objectives that go hand in hand with higher volatility and higher StrategySuperior returns are sought through tactical asset allocation and high convictionbets across the income-yielding universe, including corporate and governmentbonds, money market instruments, preference shares and listed are taken across the entire duration and credit spectrum. This is anactively managed and widely diversified income choose this fund?

2 *Actively and aggressively managed.*Widely diversified - invest across all income-yielding asset classes.*Can invest through the entire duration and credit spectrum.*Specialist and experienced investment team implements high conviction investmentviews.*This fund complies with holding a minimum of 35% Namibian InformationClassificationDomestic - Fixed Interest - Varied SpecialistRisk profileCautiousBenchmark*Stefi + 1% launch date1 June 2007 Minimum investmentLump Sum N$ 5 000 | Monthly N$ 200 Portfolio sizeN$1, millionLast two distributions30 Sep 18: cents per unit30 Jun 18: cents per unitIncome decl. dates31 Dec | 31 Mar | 30 Jun | 30 SepIncome price dates3rd working day in Jan, Apr, Jul and OctValuation time of fund15:00 Transaction cut off time13:00 Fees (Incl.)

3 VAT)Retail Class (%)Initial FeeN/AAnnual Service fund is also available via certain LISPS (Linked Investment Service Providers), which levytheir own fees. Fluctuations or movements in exchange rates may cause the value of underlyinginternational investments to go up or 10 HoldingsSecurities% of PortfolioSim Namibia Floating Rate Fund Class B2 (D) RSA NCD Property NCD Windhoek F/R National Bank Namibia F/R Bank Namibia F/R Windhoek F/R Bank Namibia F/R 10 Holdings as at 30 Sep 2018 Performance (Annualised)Retail ClassFund (%)Benchmark (%)1 return is the weighted average compound growth rate over the period (Cumulative)Retail ClassFund (%)Benchmark (%)1 return is aggregate return of the portfolio for a specified AllocationCash and Money Market AssetsBonds 0 - 3 yearsBonds 3 - 7 yearsBonds 7 - 12 yearsBonds 12+ yearsInflation Linked BondsPropertyBond Namibia Active FundSeptember 2018 This monthly Fund Fact Sheet should be viewed in conjunction with the Portfolio Manager Commentary Manager(s) Quarterly Comment - 30 Sep 2018 Market reviewThe Fund delivered good returns over a relatively challenging investmentperiod locally as well as globally with resulting spillover effects into ourlocal market during the last 12 months, and again in the third investment returns did not bear much fruit during the first half ofthe year and came accompanied with a fair share of volatility.

4 Globaldeveloped market equities ended the first half of the year relatively flatwith emerging market equities down more sharply, while local SouthAfrican equities finished the first half marginally negative, although all ofthese were bumpy rides along the way. International bond and creditmarkets remained under pressure amid rising global tensions and the USFederal Reserve (Fed) continuing on their path of monetary policynormalisation, with four hikes in the target range for the federal funds rateduring the last 12 months. Investment-grade credit in the US has had aparticularly bad start to the year and delivered negative returns for thefirst half, even underperforming US equities over this period, and theperformance continued to face headwinds in the third quarter withspreads still facing a bit of upward pressure.

5 Emerging market fixed-income markets have had a tough year so far with emerging marketsovereign and credit indices finishing the first half in negative territory,both in local currency and hard currency terms, which was subsequentlyfollowed by another bout of volatility in the third quarter. Emerging marketcurrencies were under pressure in the third quarter, with the Turkish Lirafinishing the quarter down 24% and the Argentinian Peso down 30%. TheSouth African Rand was not left unscathed and finished the quarter 12% upward pressure on local interest rates resulted in the South AfricanAll Bond Index underperforming cash in the third quarter and now also forthe year to date, with the Namibian government bond performancetracking those of their South African counterparts.

6 Looking more closely atthe path of local interest rates and the bond market performance it wasquite a bumpy course so far this year. The first quarter of the yeardelivered stellar returns from local fixed-interest assets on the back of Ramaphoria and positive local sentiment, with the trend subsequentlyturning around sharply in the second quarter as international factors tookcentre stage and weighed on local bond market performance. Foreignerswere significant sellers of South African bonds during the second andthird quarter of the year and significant net foreign sales so far this spread of Namibian government bonds compared to South Africangovernment bonds traded sideways at stable but elevated levels duringthe first half of the year, with the spread of Namibian government bondyields compared to South African government bond yields subsequentlyremaining under pressure in the third Namibian economy recorded the ninth consecutive quarter of declineand has now been contracting since the second quarter of 2016.

7 NominalGDP growth for the second quarter reported by the Namibia StatisticsAgency (NSA) contracted for the second quarter from a downwardlyrevised in the first quarter. Although the growth numbers are stillnegative, the acceleration in decline seems to at least have halted,suggesting that the growth outlook is not deteriorating further. However,the meek growth environment stands in contrast with the Bank ofNamibia s more positive outlook for growth this African economic growth figures for the second quarter werereported and indicated that the local economy had slipped into a technicalSanlam Namibia Active FundSeptember 2018reported and indicated that the local economy had slipped into a technicalrecession with two consecutive quarters of negative growth. This marksthe first local recession since the global financial crisis a decade African GDP growth for the second quarter was shown to havecontracted by following a downward revised in the firstquarter.

8 The market consensus expectations were for a positive numberin the second asset allocation in the Sanlam Namibia Active Fund has worked wellso far this year and we are relatively pleased with the overall outcomesand positioning of the Fund. The Fund managed to deliver performanceduring volatile market circumstances which were driven by swings on thelocal as well as the international front. The Fund has been able toparticipate in market strength but has also been more insulated frommarket volatility than could otherwise have been the case, especiallyconsidering the events and market movements during the year. TheFund s investment objectives are always a key consideration whenevaluating the overall positioning and underlying investments. This hascontinued to prove to work well for the Fund as the performance hasmanaged to keep pace with the local market during periods of strength,while in addition we have had scope available to take advantage ofinvestment opportunities during market weakness and when interest ratestrade mandate of the Sanlam Namibia Active Fund is orientated towardshigher quality assets and it is also important to remember that the SanlamNamibia Active Fund does not utilise offshore exposures.

9 Offshore assetallocation brings the potential for associated currency diversificationbenefits and an expanded investable universe. This opportunity set couldhave added value, especially during the last 12 months as we witnessedbig moves in the local currency, in particular reversals over shorterperiods than is otherwise more generally the case. The Fund hasperformed well when considering the risk-adjusted real returns deliveredas compared to both inflation and other assets classes. When looking atthe return of the Sanlam Active Income Fund compared to inflation, theFund has performed as good as it can be expected to. Going forward itshould reasonably be expected that the performance will again normalisecloser to historic Fund has had low exposure to listed property assets over the last 12months, but the limited exposure nevertheless detracted fromperformance.

10 The positioning was based on valuations with thesubsequent weakness in the listed property sector during the year, inparticular during the second quarter, giving us the opportunity to takeadvantage with selective buying opportunities. However, the allocationsremain selective and limited with consideration to the continuedweakness in the sector. The listed property sector is quite attractivelyprice even when taking into consideration that the fundamental outlook forthe sector looks investment case for the Fund remains a compelling one: theorientation of the Fund towards quality assets in an environment wherelocal fixed-interest assets are offering attractive income-generatingreturns and good value at current levels. This rings even more true whenremembering that we are still in a low return environment globally andyields on developed market bonds are still at ultra-low levels.