Bank Of Queensland Limited · ASX:BOQ
Bank Of Queensland — Merger or Acquisition (August 2003)
24 slides from Bank Of Queensland's merger presentation, Aug 15, 2003
Slide 1: Presentation to investors: Acquisition of UFJ Australia Finance Limited and capital raising
15 August 2003 New ideas in banking Presentation to investors Acquisition of UFJ Australia Finance Limited and capital raising
Slide 2: Important notice
This presentation is supplied to you in confidence for the purposes of enabling you to evaluate the Offer and determine whether or not you wish to apply for a firm allocation of Ordinary Shares. This presentation must not be reproduced or distributed in any manner outside of your organisation. Until
Slide 3: Presenters
oT Managing Director - Bank of Queensland Chief Financial Officer - Bank of Queensland. | Executive Director - ABN AMRO Rothschild
Slide 4: Highlights
Highlights Overview of the acquisition Offer summary and timetable Pro-forma balance sheet Bank of Queensland
Slide 5: Acquisition of UFJ Finance Australia Limited: highlights
Bank of Queensland (“the Bank’) is to acquire UFJ Finance Australia Limited, an equipment financier with a $964m receivables portfolio (as at 31 December 2002) for a premium of $7m over the estimated net book value at acquisition Acquisition financed by a $117m equity and Reset Preference Share (“RP
Slide 6: 1. Overview of the acquisition
1. Overview of the acquisition
Slide 7: Strategic acquisition expanding equipment finance capabilities
>» The Bank is to expand its capabilities, diversify its portfolio in the equipment finance and lease market through a strategic acquisition of UFJ Finance Australia Limited (UFFA”) from UFJ Australia Limited >» Acquisition is consistent with our stated goal: ~ “To be Australia’s best regional bank,
Slide 8: UFFA: an equipment financier for 32 years
» An equipment financier providing traditional equipment finance and vendor finance to Australian industry through an established national sales network ~ An active equipment financier to Australian businesses for 32 years Cy » No. of managed contracts 28,000 Assets! » No. of custorners 45,000 Secur
Slide 9: A large and highly diversified portfolio of lease assets
>» A large and highly diversified portfolio of lease assets ~ Diversified geographically and across industry sectors ~ Top ten customers represent less than 7%, and no client more than 1%, of total exposure > Transport, computer and agricultural equipment accounts for the majority of assets financed
Slide 10: Greater scale in SME equipment finance
/ » Provides greater scale in the SME equipment finance market, increasing / total equipment finance assets under management from approximately $200m to over $1.1 billion ~ Brings economies of scale which enable the Bank to continue to pursue best practice initiatives whilst maintaining cost competi
Slide 11: Access to national sales force; price and multiples
Provides access to a national sales force and approximately 15,000 customers ~ Opportunity to generate additional revenues by offering the full range of the Bank’s products to these customers and distribution channels The Bank will pay approximately $13m at settlement, including estimated net book v
Slide 12: EPS accretion and securitisation
When combining the results of the Bank for the 12 month period to 28 February 2003 with those of UFFA for the 12 month period to 31 December 2002, the acquisition is EPS accretive The Bank intends to securitise a sizeable proportion of both the acquired and existing lease assets on an ongoing basis
Slide 13: Use of Funds / Source of Funds
Use of Funds Payments to vendor Refinance existing debt and other Total cost Source of Funds Placement Rights issue RPS issue Total Equity & RPS Subordinated debt Bridge Loan Total Funds > Bridge loan to be repaid from proceeds of securitisation and the existing debt issuance programs $13.4m $707.8m
Slide 14: Due diligence conducted
OL L_«§Maa MMi ini ann ii NiNNnNNnNe » The Bank and its advisers have conducted due diligence on the UFFA business, which included a review of: ~ The lease portfolio ~ The UFFA credit assessment and acceptance process and policies ~ Large portfolio exposures ~ Accounting and tax due diligence ~ Lega
Slide 15: 2. Offer summary and timetable
2. Offer summary and timetable
Slide 16: Offer summary: placement, rights issue and RPS
> The Bank intends to issue up to $92m of ordinary equity through: ~ Underwritten $30m private placement of ordinary equity to institutional investors » Shares issued in the placement will rank equally with all other shares for any final dividend that may be declared for the full year ending 31 Augu
Slide 17: Offer timetable
Acquisition announced to ASX Trading halt 15-Aug Conference call for investors and analysts (ABN AMRO Rothschild offices) 15-Aug Bookbuiid 15-Aug Share price set for placement — Allocations notified 15-Aug investors to return signed allocation acceptance letters 15-Aug Lodge Rights Offer prospectus
Slide 18: 3. Pro-forma balance sheet
3. Pro-forma balance sheet
Slide 19: Pro-forma consolidated balance sheet
—_o8_KN NNN NINN Pro-forma consolidated balance sheet is based on the most recently reviewed balance sheet of the Bank (at 28 February 2003) and the most recently audited balance sheet of UFFA (as at 31 December 2002) The Bank UFFA At28 February At 31 December Pro Forma 2003 (Reviewed) 2002 (Audited
Slide 20: 4. Bank of Queensland
4. Bank of Queensland
Slide 21: Bank of Queensland: market share, growth and earnings outlook
Strong market share in the Queensland market underpinned by an extensive branch network. Strong growth in a quality asset base, which has doubled in the past 4 years, to $7.3 billion in assets under management (as at 28 February 2003) Loan assets dominated by low risk mortgage lending Strong earning
Slide 22: Assets, earnings and credit quality trends
16% 5 14% 12% 7 § ke + 10% a 8% 2 2 8 F 6% B + 4%, g o 3 | no “B 8 ee 0% 8 tHO1 = 2HO1. = 1HOZ_-— 2HO2_— 1H 60% + : r r : “2% 2H0t ‘tHO02 2H02 1H03 THOT 2HOL 1HO2 2HO2 1HO3 wine Assets under management ($bn) sme % increase we Tier 1 Tier 2 Expense growth — iaigas Income growth es 40% 20% 0.8% L 30%
Slide 23: Share price outperformance versus indices
—UE«,L,«8§« Hii nnn inne The Bank has outperformed the S&P/ASX200 by 24% and the Financials (ex- Property) index by 30% in the past year $9.00 - {week VWAP ‘$8.73 $8.50 +2 week WAP —-$8.60 {month WAP___ $8.54 $8.00 - $7.50 fom fe $7.00 ra $6.50 + $6.00 - $5.50 —— Aug-02 Oct-02 Dec-02 Feb-03 Apr-03 J
Slide 24: Bank of Queensland key facts
» Figures correct as at 14 August 2003, unless otherwise stated + Market capitalisation $644m » Shareholders c.26,500 >» S&P Credit Rating BBB/Stable » Assets under management (at 28 February 2003) $7.3 billion >» Number of employees (at 28 February 2003) 670 >» Branches 118 -~ Corporate branches 58
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