Slide 1: BNK Banking Corporation FY20 Full Year Results
BNK Banking Corporation FY20 Full Year Results August 2020
Slide 2: Disclaimer
Disclaimer This presentation contains certain forward-looking statements with respect to the financial condition, results of operations, business plans and objectives of management. All such forward‐looking statements involve known and unknown risks, significant uncertainties, assumptions, contingen
Slide 3: Groupwide Growth
Groupwide Growth FINSURE Every business unit experienced FY20 growth Aggregation B2B Platform for mortgage brokers 1,740 mortgage brokers up 4% YoY $15.6b loan settlements in FY20 up 23% YoY Total loan book in excess of $45.5b up 19% YoY Panel of 65+ lenders BETTER CHOICE Wholesale BNK Banking B2B2C
Slide 4: FY20 Key Highlights
FY20 Key Highlights Proven strategy, now building for scaled growth FY20 Statutory NPAT $5.3m Earnings Per Share (EPS) of Group Net Income Growth (Statutory NPAT $5.6m before 6.14 cents per share incl. NPV COVID-19 related provisions) up 19.5% YoY Up 17% $35.5 Up 47% YoY 6.14 $30.2 % 5.15 FY19
Slide 5: FY20 Key Highlights
FY20 Key Highlights Proven strategy, now building for scaled growth BNK Bank Loan Book Higher % of low-cost deposit Prudent Loan-Loss Well Capitalised Up 32% accounts improving margins Provision Rate CAR% as at Jun20 $283.6 0.26% 35% $214.3 20% 0.12% 0.12% 21.2% Excl. COVID-19 overlay FY19 FY20 FY
Slide 6: Merger delivering NPAT momentum
Merger delivering NPAT momentum BNK's (previously Goldfields Money) post-merger integration with Finsure is yielding strong results NPAT ($m) 5.3 3.6 Cash NPAT $1.6m Cash NPAT (0.4) $(0.8)m FY17 FY18 FY19 FY20 (1.0) Merger between Goldfields Money Ltd. & Finsure Ltd. 6
Slide 7: Profit & Loss Statement
Group ($m) Aggregation Wholesale Bank FY2020 1 FY20191 FY2019PF 2 $ Var. % Var. Gross Revenue Commission Income/(Exp.) 290.5 187.0 103.5 55% Profit & Loss Statement Interest Income/(Exp.) Fees & Other Income 10.6 11.5 8.8 9.4 1.9 2.2 21% 23% Total Gross Revenue 312.7 205.2 231.6 107.5 52% • Operatin
Slide 8: Balance Sheet
Group ($m) FY2020 FY2019 $ Var. % Var. Assets Cash & Equivalents 89.7 97.9 (8.2) (8.4%) NPV Asset 387.2 269.4 117.8 43.7% Balance Sheet Loans & Advances Other Assets 283.6 78.8 214.3 64.5 69.3 14.3 32.3% 22.2% Total Assets 839.3 646.1 193.2 29.9% Liabilities • Strong portfolio growth in Finsure resu
Slide 9: Treasury
Deposit Balance Growth $400 FY19 – FY20 ($m) $224m $350 FY19 FY20 Treasury $300 • Cash and liquid holdings of $90m, with a robust capital $250 $171m adequacy ratio of 21.22% positioned for continued growth. $200 • Overall Deposit balance of $346m, growing by +20.5% YoY and supporting strong lending
Slide 10: Revenue Trend
Revenue Trend ($m) $40.0 Revenue Growth $35.5m $32.8m • Gross Revenue of $312.7m up 51.9% YoY and 37.3% on a $35.0 $30.2m pro forma basis. Gross Revenue (ex NPV) of $196.9m up 42% YoY and 22.5% on a pro forma basis. $30.0 • Net revenue of $35.5m, up by $5.3m (+17%), or up by $2.7m (+8%) on a pro-for
Slide 11: Segment Growth
Aggregation Net Wholesale Net Revenue Bank Net Revenue Segment Growth Revenue ($m) ($m) ($m) Segment revenue growth & profitability accelerating $22.3 $6.5 $6.7 • Highly synergistic operating segments with valuable fast $4.8 growing operating segments growing in their own right $21.6 $3.8 • Finsure
Slide 12: Finsure
Brokers (#) 1,740 Finsure 1,664 1435 • Finsure settled a record $15.6b in loans during FY20 up 23% YoY including record quarterly settlement volumes in Q4 of $4.5b. • Finsure’s market share continues to grow through the year recording an all-time monthly record of $1.7b in settlements Jun-18 Jun-19
Slide 13: Better Choice & BNK
Better Choice & BNK WHAT SETS US APART Better Choice (Wholesale) • Circa 6,000 brokers accredited with Better Choice. Recently added to the PLAN Australia aggregation panel increasing distribution capability. • Strategic shift from traditional ‘off balance’ sheet mortgage manager to non-bank lender
Slide 14: Strong Lending Growth
Strong Lending Growth Record Finsure settlements and BNK on balance sheet settlements despite challenging conditions Aggregation Settlements ($b) Wholesale Settlements ($m) Bank (On-B/S) Settlements ($m) Total Group Settlements ($b) $129.1 $16.1 $15.6 $578.4 $13.3 $12.7 $12.5 $12.0 $448.3 $385.9 $74
Slide 15: Strong Asset Growth
Strong Asset Growth Delivering double digit portfolio growth and associated recurring revenue growth Aggregation Loan Book ($b) Wholesale Loan Book ($b) Bank Loan Book ($b) Total Group Loan Book ($b) 45.5 48.1 0.28 38.10 2.34 40.60 31.80 0.21 34.20 2.3 0.17 2.24 FY18 FY19 FY20 FY18 FY19 FY20 FY18 FY
Slide 16: Strong risk management & resilience through COVID-19
Strong risk management & resilience through COVID-19 • BNK has a strong track record of risk management with $0 in write-offs for FY20 and low historical losses with only $139k credit losses for the last 14 years. On Balance Sheet Portfolio Arrears June 2020 • Credit quality has been maintained whil
Slide 17: Improved diversification and scale
Improved diversification and scale FY19 On Balance Sheet Loans ACT 0% NSW 17% NT • High quality book of residential loans (93%) and SME loans (7%) with low arrears 0% WA QLD • Loan book growth over FY20 has greatly improved diversification and scale of portfolio 67% 8% SA 1% VIC TAS 7% 0% # Actual B
Slide 18: FY21 Outlook
FY21 Outlook Set up for success • Strong starting asset base of $48.1b of total loans • Asset base delivers highly predictable recurring revenues and operating leverage • Finsure June 20 run rate volumes of >$18b delivering strong distribution opportunities for Better Choice and BNK products • Impro
Slide 19: Industry recognition
Industry recognition Confirming our place as market leaders Each business unit in our group has received recognition for excelling in their particular channels 2020 Australian Lending Awards 2019 Acquisition International Finance Awards Best Aggregator (Finsure) Best Retail Solutions Provider (BNK)
Slide 20: A Compelling Investment Case
A Compelling Investment Case Fast growing with majority of Net Income (incl. NPV) of $35.5m in FY20, up 17% YoY (+8% on a pro-forma basis). business revenue recurring Loan growth leveraging Ability to distribute BNK loans through Finsure’s 1,740 mortgage brokers and Better Choice’s 6,000+ mortgage b
Slide 21: Appendix
Appendix
Slide 22: Board Of Directors
Board Of Directors Extensive credit and risk management expertise Jon Sutton CHAIRMAN OF THE BOARD Mr Jon Sutton is a successful senior executive with over 24 years’ experience in financial services including over eight years banking CEO experience. Jon was the CEO and Managing Director of the Bank
Slide 23: Board Of Directors
Board Of Directors Extensive credit and risk management expertise Jon Denovan NON EXECUTIVE DIRECTOR Jon is well known as a leading authority on regulation and compliance for the mortgage industry. In recognition of his contribution to the industry, Jon was made the first honorary member of the Mort
Slide 24: Executive Team
Executive Team Extensive credit and risk management expertise Allan Savins GM - BANKING & WHOLESALE Allan has over 35 years’ experience within the financial services industry and is responsible for Sales & Distribution, Funder Relationships, Lending Activities, Portfolio Funding and Product & Data A
Slide 25: Executive Team
Executive Team Extensive credit and risk management expertise Lisa Stedman CHIEF OPERATING OFFICER Lisa has over 18 years’ experience building high performing teams and designing and implementing customer centric operational strategies. With a proven track record exceeding customer expectations, tra