Standard Bank Copper ETN · JSE:SBCOP
Standard Bank Copper ETN — Standard Bank Group — Investor Day (September 2023)
42 slides from Standard Bank Copper ETN's investor day presentation, Sep 27, 2023
Slide 1: Standard Bank Group Africa Regions Showcase
STANDARD BANK GROUP AFRICA REGIONS SHOWCASE 27 September 2023
Slide 2: Agenda
Agenda 1 Journey to date 4 2 Competitive edge 18 3 Risk management & capital allocation 24 4 Drivers of future growth 30 5 Conclusion 34 STANDARD BANK GROUP AFRICA REGIONS SHOWCASE | 27 SEPTEMBER 2023 2
Slide 3: The Africa Regions management team
The Africa Regions management team Yinka Patrick Antonio Helmut Siphiwe Sanni Mweheire Coutinho Engelbrecht Madonsela Chief Executive Regional CE 1 Regional CE Regional CE Chief Financial Officer Africa Regions East Africa South & Central Africa West Africa Africa Regions Experienced Chief Executive
Slide 4: Journey to date
1 Journey to date
Slide 5: Africa Regions – our journey to date
Africa Regions – our journey to date 1992 2002 - 2004 2010 2013 2018 - 2022 Acquired ANZ Acquired Uganda SBG refocus from an Opened the Côte Increased Grindlays Bank – Commercial Bank Emerging Markets to d’Ivoire rep office, shareholdings in 8 countries1 Acquired majority an Africa-focused obtained
Slide 6: Our footprint provides access to a large proportion of sub-Saharan Africa's economic activity
Our footprint provides us with access to a large proportion of sub-Saharan Africa’s economic activity >800 million people – 75% of people in SSA (excl. SA)1 Nigeria South Ethiopia Sudan Côte Ghana Ethiopia Uganda d’Ivoire Kenya DRC Ethiopia Tanzania 19 Angola ~USD1.3trn nominal Malawi sub-Saharan Za
Slide 7: We have large shares in South & Central, with opportunity to grow in East and West
We have large shares in South & Central, with opportunity to grow in the East and West Regions Banking market shares, %¹ Market relevance Lesotho 51% eSwatini South & Central Namibia Listed entities – Top 10 Malawi Leader - top 3 Botswana Tier II - #4 to #7 Zimbabwe Smaller market share in Kenya, Ma
Slide 8: 1H23 performance – delivered an excellent result
1H23 performance – delivered an excellent result 1H23 1H22 Change CCY Highlights Rbn Rbn % change • Net interest income grew due to strong average balance sheet growth % and higher average interest rates, particularly in 2H22 in Ghana, Kenya, Net interest income 17.9 12 2 46 52 Malawi, Mauritius, Mo
Slide 9: 1H23 performance – all three regions delivered
1H23 performance – all three regions delivered 1H23 1H22 Change Change Headline earnings Rbn Rbn % CCY % Africa Regions 9.3 5.6 65 63 East Africa1 1.8 1.2 55 41 South & Central 4.2 2.5 70 64 Africa2 West Africa3 3.2 2.0 63 76 Strong performance (>10% CCY growth) 1H23 1H22 % % Return on equity Modera
Slide 10: Our balance sheet growth has been strong in ZAR
Our balance sheet growth has been strong in ZAR, particularly from FY20 onwards Assets CAGR (FY13 Deposits CAGR (FY13 vs 1H23) vs 1H23) 600.0 572 11% 600.0 Total assets Total deposits 450.0 450.0 426 9% 300.0 300.0 150.0 150.0 0.0 0.0 Rbn Rbn FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY13 FY
Slide 11: Strong revenue growth, improved efficiency, and strong ROEs
Over time we have delivered strong revenue growth, improved efficiency, and strong ROEs Revenue split Cost-to-income ratio Return on equity 52.0 51.0 34% 50.0 49.0 Trading revenue 48.0 47.0 32% 46.0 45.0 NIR (excl. trading revenue) 59% 30% 28.4% 44.0 43.0 42.0 41.0 28% 40.0 39.0 Net interest income
Slide 12: Our earnings have been resilient and growth robust
Our earnings have been resilient and growth has been robust over an extended period Headline earnings R9.3bn headline earnings for six months to 30 June 2023 20% compound annual growth rate in earnings1 Rbn 1H17 1H12 1H13 1H14 1H15 1H16 1H18 1H19 1H20 1H21 1H22 1H23 1 Compound annual growth rate fro
Slide 13: Africa Regions franchise today
Africa Regions franchise today1 >7.2m 19 44% # clients countries contribution to group earnings Nigeria South Ethiopia Sudan Côte Ghana d’Ivoire Ethiopia DRC Uganda Kenya R572bn R478bn R426bn R322bn Assets Assets under Deposits Net loans Ethiopia Tanzania management Angola Zambia Malawi West Africa
Slide 14: Africa Regions – grown in the context of the group
Africa Regions – grown in the context of the group Gross loans Deposits Capital deployed 13% 15% 15% 2012 Africa Regions Rest of the group 20% 22% 27% 30 June 2023 STANDARD BANK GROUP AFRICA REGIONS SHOWCASE | 27 SEPTEMBER 2023 14
Slide 15: …to become a sizable contributor to earnings
…to become a sizable contributor to earnings Revenue Non-interest revenue Headline earnings 11% 12% 22% 2012 Africa Regions Rest of the group 36% 30 June 43% 44% 2023 STANDARD BANK GROUP AFRICA REGIONS SHOWCASE | 27 SEPTEMBER 2023 15
Slide 16: …and contributing to delivery of group's strategic priorities
…and contributing positively to the delivery of group’s strategic priorities SBG 2025 strategic priorities SBG 2025 Financial Targets SBG Today Africa Regions Today Transform client 7% - 9% 13% 16% experience Revenue growth CAGR1 Revenue growth CAGR3 Revenue growth CAGR3 Execute with ~50% 50.5% 43.9
Slide 17: Africa Regions strategy – how we define success
Africa Regions strategy – how we define success Client centred, providing a seamless client experience Partner to better serve millions of Africans directly or indirectly An Employer of Choice in the markets we operate in Top rated in Governance and Risk Culture in Africa Deliver shareholder value a
Slide 18: Competitive edge
2 Competitive edge
Slide 19: Unrivalled access to inter- and intra-Africa flows
Unrivalled access to inter- and intra-Africa flows Chinese MNCs Investment & development flows Global MNCs1 Global pools of capital, Ethiopia including investor & portfolio flows Ethiopia Regional corporates Trade corridors including ECOWAS, EAC, SADC, AfCFTA, Belt & Road Facilitate the distribution
Slide 20: Our growth supported by our client ecosystem approach
Our growth has been supported by our client ecosystem approach We have partnered Prudent Energy – Ardova PLC Nigeria Prudent Energy – Ardova PLC Nigeria Overview • Prudent Energy is an integrated Oil and Gas downstream player with 19% market share • Its main subsidiary, Ardova, is top 3 in the Oil a
Slide 21: …and our successful 15-year strategic relationship with ICBC
…and our successful 15-year strategic relationship with ICBC Case study: Nairobi Express Way • CRBC1 built the 27km express way from near Jomo Kenyatta Together, Standard Bank and ICBC, have built the International Airport to Nairobi’s Westlands within 2 years world’s leading Africa-China trade and
Slide 22: Our people are key to our success
Our people are key to our success On-the-ground, experienced and empowered teams with deep local and global expertise Diverse and engaged teams that have built strong relationships with clients and key stakeholders Ability to navigate complexity and provide pertinent strategic advisory and thought-l
Slide 23: Driving positive impact across our countries of operation
Driving positive impact across our countries of operation1 Job Creation and Enterprise Financial Inclusion Education Growth • Cumulative women financing in Kenya (KES • Kenya: 952 micro, small and medium enterprises • Ghana: Donation of laptops to 150 top STEM 13.6bn), Uganda (UGX 31bn) and Zambia (
Slide 24: Risk management & capital allocation
Risk management & capital 3 allocation
Slide 25: Doing business in Africa requires careful consideration of risks
Doing business in Africa requires careful consideration of local and global risks Risk matrix Current term Medium term Long term • Russia/Ukraine War • Fintech • Inflation • Bigtech Themes • ESG • Covid hangover • Greylisting • Political instability • US/China • High interest rates • Bad debts • Ban
Slide 26: Diversified, well-managed portfolio with average cost of risk of 103 bps
We have a diversified and well-managed portfolio, reflected in an average cost of risk of 103 bps Net loans and advances split1 Credit loss ratio 1.5% West Region, South & Central R84bn 26% Region, R161bn 1.2% 1.2% Through-the-cycle range ~R322bn1 50% 0.8% 40 bps – 60 bps 0.8% 0.5% 24% East Region,
Slide 27: Loan growth funded by increasing proportion of customer deposits
…and our loan growth has been funded by an increasing proportion of customer deposits Asset split CAGR (FY13 Deposit split CAGR (FY13 vs 1H23) vs 1H23) 600.0 11% 600.0 Other Deposits from banks 32% Cash Trading assets 4% Deposits from customers ~35% Trading Cash assets 9% 450.0 13% 450.0 of net loan
Slide 28: Supporting our resilient earnings and strong growth profile
…supporting our resilient earnings and strong growth profile Headline earnings by country • No single country concentration – reducing risk Others, 18% Headline earnings CAGR profile (1H12-1H23) 20% Namibia, 6% • “Covid-related” dip limited – earnings declined by Zambia, 21% 17% in 1H21 and then rec
Slide 29: Delivering shareholder value and funding SBG dividend
Delivering shareholder value add and funding an increasing proportion of the SBG dividend Africa Regions ROE vs COE Africa Regions’ dividend payout 28.4% 30% Africa Regions ROE Africa Regions COE1 SBG COE ~20% 25% 2012 dividend payout ratio 20% 15% 10% >50% 2022 dividend 5% payout ratio Covid 0% % F
Slide 30: Drivers of future growth
4 Drivers of future growth
Slide 31: Drivers of future growth
Drivers of future growth 1. Macroeconomic growth 2. Increase in banking 3. Leverage mega-trends 4. Expansion in existing & penetration new markets forecast GDP increase in Leverage Leverage strengths growth in SSA banking 1 mega-trends • SBG brand >4% (ex SA) 2024 - 2030, outpacing >50% 3 penetratio
Slide 32: Leveraging mega-trends
Leveraging mega-trends Agriculture Energy Transition Infrastructure, Resources Technology, supply chains and media and logistics telecoms • 200m hectares • Africa rich in • AFDB estimates • New energies • Mobile telephones uncultivated land biodiversity infrastructure finance ‒ LNG have changed Afri
Slide 33: Driving scale in existing and new markets
Driving scale in existing and new markets Scaling in existing markets Organic expansion Inorganic expansion Opportunities in new markets • Maintain leadership positions – remain relevant and retain profit pools • Bolt-on acquisitions to drive • Follow our clients to service scale – seeing some their
Slide 34: Conclusion
5 Conclusion
Slide 35: A well diversified portfolio delivering resilient earnings and strong growth
Africa Regions – a well diversified portfolio that has delivered resilient earnings and strong growth Unique footprint with access to attractive SSA1 Earnings have been resilient and growth strong dynamics Others, 18% Headline earnings CAGR (1H12-1H23) 20% Namibia, 6% Zambia, 21% Mozambique, 18% Ken
Slide 36: A well-positioned business with a long runway
Africa Regions – a well-positioned business with a long runway Well Diversified Large footprint and client base combined with business mix provide diversification and lower risk Strong Risk Management Expert Local Teams Macro and business-led opportunities provide attractive medium term growth oppor
Slide 37: Q&A
6 Q&A
Slide 38: Q&A
Q&A Yinka Patrick Antonio Helmut Siphiwe Sanni Mweheire Coutinho Engelbrecht Madonsela Chief Executive Regional CE Regional CE Regional CE Chief Financial Officer Africa Regions East Africa South & Central Africa West Africa Africa Regions STANDARD BANK GROUP AFRICA REGIONS SHOWCASE | 27 SEPTEMBER 2
Slide 39: Thank you
W Standard Bank Thank you
Slide 40: Appendix
Appendix
Slide 41: Macroeconomic overview – fundamentals of key SSA markets
Macroeconomic overview Fundamentals of key SSA markets Population Nominal GDP Real GDP growth Inflation - p.a. Trade balance Current account FX reserves (million) (USD bn) (%) (%) (USD bn) (USD bn) (USD bn) pe 2022 2022 2023f 2022 2023f 2022 2023f 2022 2023f 2022 2023f 2023f Kenya 54.0 112.2 107.6 4
Slide 42: Disclaimer – Forward-looking statements
Disclaimer – Forward-looking statements The Group may, in this document, make certain statements that are not historical facts and relate to analyses and other information which are based on forecasts of future results and estimates of amounts not yet determinable. These statements may also relate t