Zambia National Commercial Bank

PRESS RELEASE

ACQUISITION OF 49% GRZ SHAREHOLDING IN ZAMBIA NATIONAL COMMERCIAL BANK PLC BY RABOBANK NEDERLAND

for 10th April 2007

The Zambia Development Agency is pleased to advise that following the signing of the sale and purchase agreement by the Minister of Finance on 22^nd January 2007 and subsequent full satisfaction by parties to the agreement of the conditions precedent to the sale, the management and operations of Zambia National Commercial Bank Plc (ZNCB) have finally been handed over to the strategic investor, Rabo Financial Institutions Development (RFID), which is a 100% subsidiary of Rabobank Nederland.

The transaction has been conducted within the Cabinet approved framework which provided for the retention of all rural branches and the majority shareholding of 51 percent being retained in Zambian hands. The resultant shareholding structure approved was as follows:

This shareholding structure is aimed at addressing public concerns that the majority shares in ZNCB should be held by Zambians. The formula also addressed concerns that the Government would not have a majority controlling stake because it would be limited to a ceiling of 25 percent ownership.

Arrangements will soon be put in place to float the 25.8% on the Lusaka Stock Exchange. In this way a broad spectrum of Zambian investors would be accorded an opportunity to participate in the ownership of ZNCB by buying shares.

The 25 percent shareholding retained by Government is important in that it provides Government with an option to, at an appropriate time, offload these shares to Zambians as further empowerment, or continue to hold onto the shares on behalf of the tax payers. Importantly though, the 25 percent shareholding grants Government significant minority rights protection on key strategic issues in addition to the rights afforded under the shareholders agreement.

RFID has acquired the 49% GRZ shareholding at a purchase price of US$8,250,000. The offer was based on the financial position of ZNCB as of 31^st December 2004. Over time however, the financial status of the bank has changed and there is therefore need to assess the change which will result in a price adjustment as provided for in the sale and purchase agreement. GRZ and the strategic investor will therefore commission an Independent Auditor to determine the net asset value of the bank at the Completion date which will be the basis on which the price adjustment will be made.

Contrary to apprehensions and concerns by the public, RFID has agreed with Government that it will maintain all the existing rural branches for a period of 10 years with the exception of possible relocation of branches to within a radius of 5km due to practical business reasons. Furthermore, RFID during this period has contractually committed to increasing the total number of rural branches by 20 percent.

At privatization, RFID has committed that all serving employees will be retained and retrenchments if any, will be conducted in accordance with the normal course of business and in keeping with appropriate manning levels. Government has committed that retrenched staff if any, will be paid their dues from the proceeds of the sale.

RFID are only engaging a total number of three expatriate staff who includes the Managing Director, Manager for Change Management and Risk Manager. These expatriate staff have been engaged under the provisions of a Management Services Agreement which Government and RFID have signed through which RFID will provide management services and technical assistance to ZNCB for an initial period of three years.

The strategic investor Rabobank, is ranked amongst the 25 largest banks in the world, and is a broad based retail bank that has its roots firmly planted in the food and agriculture sectors dating back to the late 19^th Century. The Government is therefore satisfied that Rabobank will reposition ZNCB as an agricultural financial services provider and developer of new agro-based products to suit the rural based farmers and significantly contribute to the growth of the agricultural sector in Zambia.

The acquisition by Rabobank Nederland of 49% GRZ shareholding in ZNCB and the impending offer of 25.8 percent of the GRZ shares to the Zambian Public marks a major milestone in the privatization program being undertaken under the Zambia Development Agency.