to profitability over the next few years. acting on legal advice, the bank has embarked on a formal process to regularise shareholding in the bank. this entailed addressing correspondence to all shareholders of the bank who hold shares in contravention of section 22 of the sarb act. these shareholders hold, together with their associates, more than 10 000 shares in the bank, without having made the prescribed disclosure as required by law. these shareholders were called upon to provide the bank with an irrevocable undertaking that they would dispose of the number of shares in the bank as may be necessary to ensure that they, together with their associates, would in aggregate hold no more than 10 000 shares. shareholders were advised that should they fail and / or refuse to provide the required undertaking and fail to dispose of the requisite shares in the bank, legal proceedings against them in terms of section 22 of the sarb act would be instituted for an appropriate order to redress the matter. this order may include the disposal of shares in the bank at a price per share and subject to such terms, conditions and restrictions as a court may determine. this year the shareholder road show was only held in pretoria on 9 july. as attendance in other centres has been poor in recent years, we had indicated that the meeting would be broadcast live to the cape town and durban branches via video conferencing. however, as we did not receive any responses from shareholders confirming their attendance at these venues, the broadcast was cancelled. the pretoria road show was well attended and i encourage shareholders to take this opportunity in future to interact with the executive of the bank, outside of the agm. once again, the questions posed at the road show were specific to the persons attending. however, it would be opportune at this time to highlight that during the financial year 2013 / 14 the group adopted new accounting standards and reclassified certain financial information. this has resulted in the comparatives being restated for the financial years ending 2012 and 2013, and therefore the need for restated statements of the financial position and profit and loss. i refer you to note 16 in the 2013 / 14 annual report for further details in this regard. you have been advised that this year the panel selected only one candidate each for the non - executive director vacancies in the mining and labour sectors. this was due to the fact that very few nominations were received from the public in these sectors. the bank will review how it can improve the profile

cent in april 2014, and 6, 6 per cent in both may and june, resulting in a second quarter cpi average of 6, 4 per cent. bis central bankers ’ speeches the most recent forecast of the bank shows that inflation is expected to average 6, 3 per cent in 2014, with the quarterly peak of 6, 6 per cent still expected in the fourth quarter, following a slight moderation in the third quarter. the forecast average inflation for 2015 and 2016 is 5, 9 per cent and 5, 6 per cent respectively, with inflation expected to average 5, 5 per cent in the final quarter of 2016. inflation is expected to return to within the target band during the second quarter of 2015. monetary policy therefore faced a difficult dilemma in the period under review, with a widening output gap, downside risks to growth, and a deteriorating inflation profile with upside risks. in response to these inflation developments and in light of the need for monetary policy normalisation over time, the bank ’ s monetary policy committee ( mpc ) decided at its meeting in january 2014 to embark on a moderate tightening cycle and raised the repurchase ( repo ) rate by 50 basis points to 5, 5 per cent per annum. as the growth outlook deteriorated further and the inflation risks moderated slightly, the monetary policy stance remained unchanged at the mpc ’ s subsequent meetings in march and may. however, in the july meeting, the mpc decided to continue on its gradual normalisation path, and raised the repurchase rate by 25 basis points to 5, 75 per cent per annum. the committee remained concerned about the upside risks to the inflation outlook, and the increased risk of a wage - price spiral in the context of the current difficult labour relations environment, with the risk of double digit wage settlements becoming the economywide norm. given the global and domestic risks to the outlook, future changes in the monetary policy stance will remain highly data - dependent. the mpc will remain focused on its core mandate of price stability, but will also be mindful of the impact of its policy actions on economic growth. many of the problems that the country faces are not within the purview of the bank ’ s mandate, nor does the bank have the policy levers to address these issues. however, the bank will continue to play its part in supporting the economy through these difficult times by maintaining its focus on price stability in support of sustainable economic growth. while price stability remains the core mandate of the bank, financial