Rhb Bank Bhd. · MYX:RHBBANK
Rhb Bank Bhd — H1 2019 Earnings Presentation
32 slides from Rhb Bank Bhd's earnings presentation, Aug 26, 2019
Slide 1: RHB Bank Berhad Analysts Presentation 1st Half 2019 Financial Results
RHB BANK BERHAD Analysts Presentation 1st Half 2019 Financial Results Dato' Khairussaleh Ramli Group Managing Director RHB Banking Group 26 August 2019
Slide 2: Agenda
2 1. Executive Summary 2. 1st Half 2019 Financial Results 3. Strategy Update 4. Summary and Outlook
Slide 3: Executive Summary
3 Executive Summary
Slide 4: Highlights of H1 2019 Performance (1/2)
4 Highlights of H1 2019 Performance (1/2) Year-on-year: Net profit rose 7.3% to RM1,245.6 million: Total income grew 3.9% to RM3,519.0 million Net fund based income declined by 2.6% to RM2,415.5 million mainly attributed to higher funding cost from impact of OPR hike in January 2018 and partly
Slide 5: Highlights of H1 2019 Performance (2/2)
5 Highlights of H1 2019 Performance (2/2) Group Wholesale Banking recorded a pre-tax profit of RM972.8 million, down 0.8% Y-o-Y: Group Corporate & Investment Banking pre-tax profit declined 9.5% to RM315.7 million on the back of lower net fund based income and non-fund based income as well as hi
Slide 6: RHB Banking Group Scorecard for 2019
6 RHB Banking Group Scorecard for 2019 Top Level Indicators Target 2019 Actual H1 2019 ROE 10.5% 10.4% N1 Loans Growth 5.0% 6.9% N2 5.0% CASA Growth 2.2% N2 (Group) Gross Impaired Loans Ratio <2.0% 2.15% Cost-to-Income Ratio 49.0% 48.5% N1 : Annualised N2 : Year-on-year growth
Slide 7: 1st Half 2019 Financial Results
1st Half 2019 Financial Results
Slide 8: H1 2019 profits up Y-o-Y driven by resilient income growth
H1 2019 profits up Y-o-Y driven by resilient income growth, positive JAWS and lower allowances for 8 ECL; CIR and credit charge ratio improved Financial Position Financial Results Key Financial Ratios Total Gross Total Operating Profit Non-fund Based/ ROE Assets Loans Income Before Allowance Total I
Slide 9: Q2 pre-tax profits up Y-o-Y and Q-o-Q
Q2 pre-tax profits up Y-o-Y and Q-o-Q from higher non-fund based income and lower allowances for ECL 9 on loans Q2 Q1 Q2 Q-o-Q Y-o-Y H1 H1 Y-o-Y RM’ mil 2018 2019 2019 % % 2018 2019 % Net Interest Income 937 880 881 0 -6 1,867 1,761 -6 Net Islamic Fund Base Income 308 328 326 -1 6 614 654 7 Total Ne
Slide 10: H1 2019 net fund based income declined 2.6% Y-o-Y
H1 2019 net fund based income declined 2.6% Y-o-Y due to higher funding cost and impact from OPR 10 cut in May 2019; NIM compression continued in line with expectations Y-o-Y: +7% RM’bil Y-o-Y: +16% Y-o-Y: -3% Y-o-Y: -3% Q-o-Q: -0.1% 5.66 5.27 3.25 2.67 2.81 2.85 2.79 2.48 2.41 1.43 1.60 1.64 1.24 1
Slide 11: H1 2019 non-fund based income grew 21.8% Y-o-Y
H1 2019 non-fund based income grew 21.8% Y-o-Y driven by higher IB fees, investment and trading 11 income and insurance underwriting surplus RM’mil Y-o-Y: +53% Y-o-Y: +22% Others N2 1,104 Treasury Related Income Q-o-Q: +7% 41 Insurance Underwriting Surplus 906 35 427 Fee Income N1 261 534 570 373 30
Slide 12: Operating expenses rose 2.7% Y-o-Y
Operating expenses rose 2.7% Y-o-Y mainly from higher personnel costs, IT-related expenses and 12 marketing costs; Positive JAWS maintained with CIR improving to 48.5% Y-o-Y: +3% RM’mil Administration & General Expenses Y-o-Y: +8% Marketing Expenses Establishment Costs Q-o-Q: +2% 1,662 1,708 Personn
Slide 13: Gross loans grew 6.9% Y-o-Y
13 Gross loans grew 6.9% Y-o-Y driven mainly by mortgage, SME, corporate and Singapore Composition Jun Dec Jun YTD Y-o-Y Dec Jun RM’mil 2018 2018 2019 Growth Growth 2018 2019 % % % % GROUP RETAIL 80,446 84,643 87,774 3.7 9.1 50 51 Mortgage 50,498 53,467 56,353 5.4 11.6 32 33 Commercial Property Fina
Slide 14: Total deposits grew 10.9% Y-o-Y
Total deposits grew 10.9% Y-o-Y led by higher fixed deposits and continued focus on CASA; CASA 14 ratio stood at 26.6% as at end-June 2019 CASA Customer Deposits Y-o-Y : +2% Y-o-Y : +11% RM’bil RM’bil YTD : +6% YTD : +3% 48.1 49.2 46.4 185.0 10.1 10.3 178.9 10.1 166.8 38.0 36.3 38.9 46.4 49.2 48.1 J
Slide 15: Credit charge ratio improved; slight uptick in GIL ratio
Credit charge ratio improved; A slight uptick in GIL ratio in Q2 mainly coming from Singapore, but 15 overall in line with expectations RM’mil Allowances for Loan Impairment RM’mil Asset Quality 250 N2 2.37% 2.50% 0.3 0% 4,300 2.33% 0.22% 2.15% 200 0.22% 2.06% 2.12% 0.19% 0.18% 0.20% 0.18% 0.2 0% 2.
Slide 16: Contained O&G exposure (Loans + Bonds)
16 Contained O&G exposure (Loans + Bonds) as it continued to be monitored Oil and Gas Related Industry Upstream Downstream Total Loans + Bonds % to % to % to Outstanding RM’ bil Gross Loans RM’ bil Gross Loans RM’ bil Gross Loans Jun 2019 2.7 1.6% 1.4 0.8% 4.1 2.4% Mar 2019 2.7 1.6% 1.5 0.8% 4.2 2.4
Slide 17: Growth momentum continued for Retail, BBG and Treasury
Growth momentum continued for Retail, BBG and Treasury; CBIB contribution affected by lower net 17 fund based and non-fund based income and higher allowances for ECL; Singapore impacted by higher allowances for ECL Revenue 5% 1,179 1,233 6% 9% RM’ mil 2% 799 748 778 716 535 545 4% 0.2% >100% 187 188
Slide 18: Capital position remained robust
18 Capital position remained robust for the Group and key banking subsidiaries RHB Bank Group RHB Bank 20. 0% 20. 0% 19. 0% 18. 0% 18.8% 19.4% 18. 0% 17. 0% 16. 0% 16. 0% 16.8% 17.2% 15. 0% 14. 0% 13. 0% 15.5% 16.3% 15.7% 16.5% 14. 0% 14.4% 12. 0% 14.1% 12. 0% 13.3% 13.5% 11. 0% 10. 0% 10. 0% 9.0 %
Slide 19: Declared an interim dividend of 12.5 sen per share
19 Declared an interim dividend of 12.5 sen per share representing a 40.2% payout, our highest ever Market Capitalisation Dividend Per Share (sen) RHB Capital RHB Bank 5.57 5.50 5.29 40.2% 40.0% 35.7% 33.9% 5.00 20.50 5.00 30.8% 28.6% 30.0% 4.68 4.71 22.3 21.2 4.50 15.00 20.0% 13.00 12.50 20.1 12.00
Slide 20: Strategy Update
Strategy Update
Slide 21: FIT22 Key Highlights – Our Progress So Far
21 FIT22 Key Highlights – Our Progress So Far Fund our Journey • Affluent : Steady traction on customer acquisition by 7.6% YTD Jun 2019 to 65.2k customers from Dec 2018, of which 34.7% are SME owners. Total AUM of Premier customers grew by 10.9% to RM32.5 bil in the same period • SME : Strong growt
Slide 22: Summary and Outlook
Summary and Outlook
Slide 23: Economic Outlook
23 Economic Outlook Malaysia’s GDP growth gained pace to 4.9% Y-o-Y in Q2 2019 (Q1 2019: 4.5%), mainly driven by private spending For the year 2019, GDP is expected to moderate to 4.5% in 2019 (2018: 4.7%) as global economic outlook continues to be clouded by global trade tensions and heightened
Slide 24: Concluding Remarks
24 Concluding Remarks The Group demonstrated sustained performance in Q2 2019 on the backdrop of challenging operating environment Loans and financing Y-o-Y growth continued to be driven by mortgages, SME and Singapore Full impact of May OPR cut is expected to result in lower NIM of between 2.
Slide 25: Thank You
THANK YOU www.rhbgroup.com INVESTOR RELATIONS CONTACT Haryati Yahya Direct Line : +(603) 9280 2489 Email : haryati.yahya@rhbgroup.com This material is prepared for general circulation. Any recommendation or view contained in this document does not have regard to the specific investment objectives, f
Slide 26: Appendix
Appendix
Slide 27: Retail Banking
27 Retail Banking Gross Loans Customer Deposits RM’bil RM’bil Y-o-Y: +9% Y-o-Y: +14% 100 .0 57.3 90. 0 50.1 9.4 80. 0 70. 0 9.1 7.4 60. 0 7.2 50. 0 80.4 87.8 40. 0 33.8 40.5 30. 0 20. 0 Jun 2018 Jun 2019 Jun 2018 Jun 2019 Fixed Deposits Demand Deposits Savings Deposits RM’bil Asset Quality Retail Ma
Slide 28: Investment Banking – Market Positions & Asset Management (1/2)
28 Investment Banking – Market Positions & Asset Management (1/2) Market RM’bil Asset Under Management YTD Jun 2019 Share Ranking Y-o-Y : +2% Equity: - By value 7.9% 5th - By volume 12.5% 3rd 49.7 50.8 6.8 7.1 Debt Capital Markets: - MYR sukuk 8.3% 4th 12.9 11.4 - Total MYR bonds (Conventional & 7.8
Slide 29: Investment Banking – Notable Deals (2/2)
29 Investment Banking – Notable Deals (2/2) M&A DCM ECM Can-One Berhad Leong Hup International Berhad Danum Capital Berhad RM800.0 million to RM1,000.0 million RM1.19 bil RM10.0 bil Sukuk Danum Programme Disposal of the entire issued share capital of Main Market IPO Issuance of RM3.5 bil F & B Nutri
Slide 30: Business Banking
30 Business Banking Gross Loans Customer Deposits RM’bil RM’bil Y-o-Y: +4% Y-o-Y: +17% 26. 0 27.3 25. 0 23.5 24. 0 13.7 13.3 23. 0 25.7 22. 0 24.6 21. 0 10.2 13.6 20. 0 Jun 2018 Jun 2019 Jun 2018 Jun 2019 Fixed Deposits Demand Deposits RM’bil Asset Quality SME Market Share 9.2% 3.20% 3.25% 3.10% 3.0
Slide 31: Islamic Banking
31 Islamic Banking PBT Gross Financing RM’mil RM’bil Y-o-Y: +22% Y-o-Y: +31% 60.0 50.0 40.0 56.1 30.0 20.0 45.9 359 10.0 275 - Jun 2018 Jun 2019 H1 2018 H1 2019 Market 8.4% 9.5% Share Gross Financing/ Total Gross Financing (Domestic) RM’mil Asset Quality 1.14% 1.08% 0.97% 0.93% 0.82% 35.3% 36.0% 34.
Slide 32: RHB Singapore
32 RHB Singapore SGD’mil PBT SGD’bil Loans, Deposits & Total Assets 40 23 6.8 35 6.4 0.2 30 25 0.3 20 15 29 10 6.0 6.6 10 4.4 4.0 4.9 3.7 5 11 - (5 ) … (2) Jun 2018 Jun 2019 (1 0) H1 2018 H1 2019 Deposits Gross Loans RHB Bank Singapore RHB Securities Singapore Total Assets (RHB Securities Singapore)