Saudi Investment Bank · TADAWUL:1030
Saudi Investment Bank — The Saudi Investment Bank — 9M 2023 Earnings Presentation
27 slides from Saudi Investment Bank's earnings presentation, Nov 6, 2023
Slide 1: Earnings Presentation 9M 2023
Earnings Presentation 9M 2023 6 November 2023 The Saudi Investment Bank – 3Q 2023 Earnings Presentation P. 1
Slide 2: Contents
Contents 9M 2023 Performance Highlights 3 Strategy 4 Financial Performance 11 2023 Guidance 23 Appendix 26 The Saudi Investment Bank – 3Q 2023 Earnings Presentation P. 2
Slide 3: Growth momentum sustained in 9M 2023 demonstrating solid progress
Growth momentum sustained in 9M 2023 demonstrating solid progress Loans Deposits Loan growth of 16% YTD driven by corporate segment while deposits grew 23% +16% YTD +23% YTD YTD on higher time deposits Double digit growth in operating income underpinned by 19% YTD growth in assets SAR 80.2 bn SAR
Slide 4: Strategy
Strategy The Saudi Investment Bank – 3Q 2023 Earnings Presentation P. 4
Slide 5: SAIB has started to see real growth momentum, reaching Revenue of SAR1 bn in 3Q 2023
SAIB has started to see real growth momentum, reaching Revenue of SAR1 bn in 3Q 2023 Revenue (3Q 2014 to 3Q 2023) Net Loans (3Q 2014 to 3Q 2023) SAR 1.0 1.X bn SAR SAR 80 77 bn bn 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 14 15 15 16 16 17 17 18 18 19 19 20 20 21 21 22 22 23 23 Total
Slide 6: Strategy built on agility, innovation and focus on corporate and HNW customers
This is underpinned by the Bank’s strategy to build on its agility, culture of innovation and focus on corporate and HNW customer relationships… SAIB’s size allows agility Corporate and Private Banking Focus Corporate and HNW customers are in SAIB’s DNA Total Assets (2Q23, SARbn) Total Assets by Seg
Slide 7: …and a real focus on building on market opportunities
…and a real focus on building on market opportunities Corporate banking is still underpenetrated in KSA with… …ample room to grow – SAIB market shares have upside from today Saudi Arabia Credit to GDP SAIB Market Share by Corporate Loans (FY22, %) 63% by 2025 63% Large & Medium Corporate 3.40% Mediu
Slide 8: We have identified key areas for improvement and are addressing them…
We have identified key areas for improvement and are addressing them… Further Upside - Cost Efficiency from Digitization of Branches Significant opportunity to improve the NIBD ratio Total assets per branch (2Q23, SARm) NIBD % of Total Deposits (2Q23, %) 54% 2,423 2,084 40% SAIB KSA Average SAIB KSA
Slide 9: …with a strategy that is focused on growth opportunities in the KSA market
…with a strategy that is focused on growth opportunities in the KSA market Key Strategic Revisit segmentation Redesign the Revamp value Streamline and Priorities and coverage operating model proposition automate key processes Corporate Banking Public Institutions Accelerate Increase penetration
Slide 10: We aim to grow market share, increase fee income and improve efficiency to drive higher ROTE
We aim to grow market share, increase fee income and improve efficiency to drive higher ROTE Grow Market Share in Corporate Loans Grow Market Share in Retail Loans SAIB has already started to close the gap Corporate KSA Market Share Retail KSA Market Share towards KSA peers’ return on equity Return
Slide 11: Financial Performance 9M 2023
Financial Performance 9M 2023 The Saudi Investment Bank – 3Q 2023 Earnings Presentation P. 11
Slide 12: SAIB is focused on delivering strong results across key performance indicators
SAIB is focused on delivering strong results across key performance indicators 9M 2023 DRIVERS LOANS & ADVANCES SAR 80.2bn +16% YTD Strong growth in Corporate (+23%) and Private Banking (+6%) loans Balance Sheet DEPOSITS SAR 85.5bn +23% YTD Strong growth in IBDs (+41%) mainly from public institution
Slide 13: Growth across assets, funded largely by increase in deposits
Growth across assets, funded largely by increase in deposits Total assets increased by 19% YTD as loans grew 16% and investments rose 16%, further supported by increase in SAMA and bank placements Loans & Advances (SARbn) Retail Corporate Other Total liabilities increased 23% YTD, mainly driven by g
Slide 14: Loan growth continues to gain momentum driven by corporate lending
Loan growth continues to gain momentum driven by corporate lending 16% YTD growth in loans driven by 23% increase in Loans & Advances by segment (%) corporate lending Active participation in syndicated loan market for +4% Loans QoQ infrastructure projects, well supported by demand from other key
Slide 15: Investments grew 16% YTD driven by debt securities
Investments grew 16% YTD driven by debt securities 96% of investments were fixed rate debt securities as Investments, Gross by type (%) Investments by accounting classification (%) of 9M 2023 61% of investments were accounted for at fair value through other comprehensive income and 38% at amortized
Slide 16: Customer deposits increased 23% driven by IBDs
Customer deposits increased 23% driven by IBDs Deposits grew 23% YTD during 9M 2023 mainly driven Deposits by segment (%) by increase in interest-bearing deposits IBDs rose 41% YTD from large inflows to time deposits +23% Deposits YTD amid higher interest rate environment NIBDs were stable YTD Ret
Slide 17: 14% growth in 9M 2023 earnings driven by NCSI growth moderated by lower recoveries
14% growth in 9M 2023 earnings driven by NCSI growth moderated by lower recoveries Net income increased 14% YoY in 9M 2023 driven by strong growth of 26% in operating income, partially offset by an increase of 18% in operating expenses and a rise Total Operating Income Movement YoY (SARmn) in impair
Slide 18: NSCI growth of 29% YoY on 19% growth in earning assets and a 24bps NIM expansion
NSCI growth of 29% YoY on 19% growth in earning assets and a 24bps NIM expansion NSCI growth of 29% YoY was underpinned by 19% NIM Average Earning Assets (SARbn) Consumer loans NIM Asset yield CoF 3.07% growth in average earnings assets as well as NIM Corporate & other loans expansion of 24 bps re
Slide 19: Growth in fee and other income driven by foreign exchange and investment income
Growth in fee and other income driven by foreign exchange and investment income Fee & other income increased 9% YoY in 9M 2023, Fee & Other Income Movement YoY (SARmn) mainly driven by foreign exchange and investment income Foreign exchange income was well supported by strong +9% transaction volum
Slide 20: An 18% increase in operating expenses reflects implementation of strategic initiatives
An 18% increase in operating expenses reflects implementation of strategic initiatives Operating expenses increased 18% YoY in 9M 2023, Operating Expenses Composition Operating Expenses (SARmn) mainly due to increase in general & administration expenses and employee related costs as bank continued (
Slide 21: Credit quality improved further with NPL ratio at low levels
Credit quality improved further with NPL ratio at low levels Total impairments increased SAR 306mn YoY in 9M Impairments (SARmn) Impairment for loans Cost of risk 2023 mainly due elevated recoveries in 9M 2022 Other impairments totaling SAR 294mn vs. SAR 45mn in 9M 2023 0.45% 249 0.43% Cost of risk
Slide 22: Solid liquidity, funding and capital position with adequate buffers
Solid liquidity, funding and capital position with adequate buffers LCR declined by 18.3ppts during 9M 2023 to 201.6%, Liquidity Ratios LCR NSFR Loans to Deposits Ratio SAMA LTD Headline LTD while NSFR moderated 3.6ppts to 111.1% As of 9M 2023, the SAMA regulatory LTD ratio was within required level
Slide 23: 2023 Guidance
2023 Guidance The Saudi Investment Bank – 3Q 2023 Earnings Presentation P. 23
Slide 24: 2023 Guidance and Outlook
2023 Guidance and Outlook 2022A 9M 2023A 2023 GUIDANCE DRIVERS Balance Sheet LOANS & ADVANCES +19% +16% Mid to high teens Strong growth in Corporate and Private Banking loans; guidance YoY YTD unchanged from 2Q 23 NET INTEREST MARGIN 2.92% 3.07% 3.00% – 3.05% Guidance downgraded from 3.10% – 3.20% o
Slide 25: Q&A
Q&A The Saudi Investment Bank – 3Q 2023 Earnings Presentation P. 25
Slide 26: Appendix
Appendix The Saudi Investment Bank – 3Q 2023 Earnings Presentation P. 26
Slide 27: SAIB Investor Relations
SAIB Investor Relations For more information, please visit www.saib.com.sa/en/investor-relations or contact SAIB Investor Relations at ir@saib.com.sa The Saudi Investment Bank – 3Q 2023 Earnings Presentation P. 27
The Saudi Investment Bank — 9M 2023 Earnings Presentation on 6ix