middle of difficulty lies opportunity ”. to a large extent this wisdom can be applied to the world economy and financial markets. there are numerous examples of how it sometimes takes a disaster or a crisis for a structural improvement to occur. it was only after the asian crises of the late 1990s that asian emerging markets started to build foreign exchange reserves and strengthen their macroeconomic fundamentals. today, emerging markets are the net savers of the world, and reap the good results of their macroeconomic discipline in the form of low risk premiums and borrowing rates, ratings upgrades, increased foreign investment and accelerated growth rates. on a micro level, companies have behaved in much the same way. after having been plagued by accounting scandals, downgrades to “ junk ” status, section 11 classifications and some verging on the edge of bankruptcy, they have pulled themselves together. corporations have deleveraged their balance sheets and became net savers, accounting standards have improved and corporate governance has become a major focus area. in an environment of strong economic growth, this should definitely put them on a ‘ pathway to higher growth ’. consistent with the strength of corporate profits, improved balance sheets and diminishing excess capacity, investment is expected to be strong, contributing to renewed growth. a positive development in the global economy that tentatively seems to be emerging is that growth is becoming more balanced and broad - based. in 2004, the us growth rate was double that of europe and japan. although the us remains the main engine of growth among the industrialised countries, the gap in growth rates is expected to narrow, with us growth moderating from 4, 2 per cent in 2004 to 3, 4 per cent in 2006, european growth remaining around 2, 0 per cent and japanese growth accelerating from 2, 3 per cent in 2004 to 2, 8 per cent in 2006. developing asia is also likely to remain an engine of growth, with output expected to increase by 8, 2 per cent in 2006, and that of china alone by 9, 5 per cent. another remarkable thing about the current cycle of strong global growth is that it has been taking place whilst oil prices have been hovering between usd60 and usd75 per barrel for some time now – levels that would have been almost unthinkable a few years ago and which would have caused market analysts to significantly revise down their growth forecasts. perhaps more surprising is that high oil prices do not seem to have filtered through to other prices to the extent that might have been

cooperation with national treasury, the bank and the private sector, the issue was resolved and prevented systemic spillovers, which includes the application of bail - in provisions. this was in line with the key attributes of effective resolution regimes of the financial stability board, which south africa has undertaken to adhere to as a g - 20 member country. african bank limited remains under curatorship and, once it is restructured, it is anticipated that the resulting “ good bank ” will be relisted in the foreseeable future. let me now turn to the annual report. bis central bankers ’ speeches the bank remains committed to complying with best practice in terms of integrated reporting, insofar as it is practical for a central bank to do so, taking into account the overriding legislation and confidentiality requirements. the 2014 / 15 annual report reflects a holistic account of all relevant and material financial and non - financial information, which will enable stakeholders to evaluate the performance and impact of the bank ’ s operations and the implementation of its mandate. we have again this year enhanced the look and feel of the printed annual report and produced an interactive and easy to navigate html version on the website. we hope that you have enjoyed reading the report. i am pleased to report that, having made losses in the previous five financial years, the bank has returned to profitability. i should emphasise, however, that the bank does not have a profit - maximising objective and that its operations are conducted in the broader interests of the country, in pursuit of its mandate and responsibilities. the group recorded an after - tax profit of r0, 63 billion compared with a loss of r1, 3 billion in the previous financial year. this improvement in the financial position of the bank was attributable mainly to unrealised profits due to declining global bond yields and the depreciation of the rand against major currencies, which increased the rand value of the interest earned from investing the country ’ s foreignexchange reserves. operating cost increases were attributable mainly to the higher cost of producing new currency, higher staffing costs, as well as the change in the actuarial assumptions related to post - retirement benefits. this year the shareholders ’ roadshow was held only in pretoria on 14 july, as there were no timeous confirmations received from shareholders who wished to participate in the event at the cape town and durban branches via a video conference facility. unfortunately, we have found that the interest from shareholders