Moody’s places Investec Bank (Australia) on Review for Possible Downgrade

Sydney, May 27, 2009 -- Moody's Investors Service has placed Investec Bank
(Australia) Limited on review for possible downgrade, following a
significant increase in impaired assets and weaker earnings for the bank,
as reported in the recent Investec Group results. Ratings included in the
review are the bank's bank financial strength rating (BFSR) of C-,
long-term senior unsecured debt and deposit ratings of Baa1,
subordinated debt rating of Baa2, and short-term ratings of Prime-2.

"The review on Investec Bank (Australia)'s ratings follows a deterioration
in the bank's financial profile which was larger than expected, relative
to the current level of deterioration in the economic environment," said
Marina Ip, an Assistant Vice President with Moody's Sydney office.

"The bank has been impacted by a number of forces, including reduced
revenues due to a sharp fall in principal transaction flow, rising
impairment levels related to its historical focus on property amidst a
slowing property market, and higher provisions made against certain
investments. Although to some extent, the decline in earnings was driven
by the bank's conservative practice of holding a high level of surplus
liquid assets, as these securities provide a lower return" Ip adds.

Investec Bank (Australia) maintains solid capital ratios which remain in
Moody's highest rating category for this metric, which provide a cushion
against future impairment charges. However, the bank does have a
relatively high credit concentrations which need to be considered in this
context.

The bank has a very strong liquidity position, which almost entirely
covers its wholesale borrowings.

The review will focus on assessing the potential for further impairment,
as well as initiatives the bank are adopting to adjust towards a more
stable business model. The building of alternative business lines which
can provide more predictable and reliable income will be a positive
factor to the rating, as internal capital generation will most likely be
the source of additional core capital for Investec Bank (Australia).

Investec Bank (Australia)'s deposit and debt ratings will depend on its
BFSR, which measures the bank's stand-alone credit profile. As Investec
Bank (Australia) is currently rated higher than its parent, Investec Bank
plc (rated Baa3), there is no uplift to its baseline credit assessment of
Baa1.

The last rating action on Investec Bank (Australia) Limited was on 1
December 2008, when the institution-level backed Prime-1 ratings
relating to the interim government guarantee (which was subsequently
replaced by the new government guarantee scheme) were withdrawn.

The principal methodologies used in rating Investec Bank (Australia)
Limited were "Bank Financial Strength Ratings: Global Methodology" and
"Incorporation of Joint-Default Analysis into Moody's Bank Rating
Methodology", both of which can be found at www.moodys.com in the Credit
Policy & Methodologies directory, in the Ratings Methodologies
subdirectory. Other methodologies and factors that may have been
considered in the process of rating Investec Bank (Australia) Limited
can also be found in the Credit Policy & Methodologies directory.

Investec Bank (Australia) Limited is headquartered in Sydney, New South
Wales, Australia. It reported assets of AUD5.1billion (approximately
USD3.5billion) at 31 March 2009.