Introduction to Cytonn Cash Management Solution (CMS)

I. Cytonn Cash Management Solutions

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Cash Management Solutions - Product Overview Product is ideal for investors that wish to invest their funds for a specific period of time at a fixed return on investment  The Cash Management Solutions (CMS) is a product that seeks to give clients higher returns than they would otherwise

2011 get on their own due to economies of scale as we consolidate funds from various investors,

and have a dedicated dealing

team searching for the best opportunities  We invest in a diversified range of products such as bank deposits and real estate-backed commercial papers 2012

 Benefits of CMS:  A fixed rate of return on a relatively liquid product  It ensures consistently competitive interest rates on investments

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The client benefits since they have access to in-house fixed income analysis from the fund management’s team

 The product has access to exciting opportunities sought by the dealing team

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Cash Management Solutions - How the team gets higher returns Cytonn CMS has consistently delivered competitive returns to clients  Cytonn Investments Management Limited is able to get significantly better rates for investors due to various factors;

2011 1. Consolidation leads to economies of scale: Instead of investing Kshs. 10 million for one client, we will aggregate

the sum of 10 clients with Kshs. 10 million each and negotiate rates for Kshs. 100 million

2012 2. Dealing capability: At any given day, we are dealing with all the banks on the approved banks list, giving us a unique view of liquidity needs across the banking sector 3. Quick decision making & analytics capabilities: Some of the placement opportunities such as sale-buy-backs require a turn-around of 2 to 3 hours to secure the opportunity. We are able to analyze such opportunities and make

201 decisions quickly 3 4. Credit Analysis Capability: The team has the capability to analyze non-bank placements such as commercial papers 5. Current Rates of Return:  3 months- 18% p.a  6 months- 18% p.a  12 months- 18% p.a

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Cash Management Solutions- Operational Structure The Cash Management Solution is a completely separate legal entity from the manager •

The partnership has been structured to receive cash investments from investors, while Cytonn contributes intellectual and human capital 2011

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The product is governed by the partnership deed and there is a fund management agreement with Cytonn Investments

Various CMS Investors

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Cytonn Dealing Team places funds into various investments As negotiated by the Investment Team i.e. Analysts & Dealers

CMS Fund held under Stanchart Custody

Cytonn’s Investment Team gives direction to Stanchart Custody on placement of Funds, and never handle the Funds directly

Investors brought in by Cytonn Financial Advisors (FA’s)

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Cash Management Solutions – Key Features Highlighted are the Key Terms for the Cash Management Solutions fund  Minimum Investment Amount:

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Kshs. 1 million for initial investment

 Minimum Top up Amount:

Kshs. 100,000.00

 Duration of Investment:

Minimum 1 month. Options of 1, 3, 6, 9 and 12 months also available

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Note: The duration has to be agreed in advance of investment. On maturity, an investor can roll over the funds at an attractive rate or choose to withdraw the funds  Documentation: 1. New Client: 201 3

A completed Cash Management Solutions application form with relevant KYC documents provided

2. Existing clients: A completed Cash Management Solutions Form

 Top ups will be considered as a separate investment i.e. they will earn a return based on the week they are received  The rates will be circulated to clients on a weekly basis

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Comparison of CMS to other Cash Instruments CMS provides the highest returns over a stated period of time Suitability

2011 Bank Accounts

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 Suitable for investors whose investment needs

Pros

Cons

 High Liquidity

 Little or no return

 Capital is Preserved

 Expensive in terms of ledger fees and

are less than two years

transaction costs  Little or no Diversification  Suitable for investors

Other 201 Money 3Market Funds

 Good yield/return on

whose liquidity

investment

requirements are not

 Highly liquid

predictable at the onset

 Capital is preserved

 Fluctuations in yield  Returns subject to market movements

 Low minimum requirement  Well Diversified  Suitable for investors Cash Management Solutions

 Return is guaranteed

whose liquidity needs are

 High Return net of costs

predictable

 Well Diversified

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 Moderate Liquidity

Cytonn Investments Management Ltd. 3rd Floor, Liaison House, State House Avenue, Nairobi, Kenya P. O. Box 20695 - 00200, Nairobi, Kenya +254 (0)20 4400420, +254 (0) 709 101 000 www.cytonn.com

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