Malayan Banking Bhd. · MYX:MAYBANK
Malayan Banking Bhd — FY2011 Earnings Presentation
59 slides from Malayan Banking Bhd's earnings presentation, Aug 22, 2011
Slide 1: Financial Results FY2011 ended 30 June 2011
FINANCIAL RESULTS FY2011 ended 30 June 2011 Analyst Briefing 22 August 2011
Slide 2: Executive Summary
Executive Summary Financial Performance B i Business Review R i Country Review Kim Eng Update Economic Update p and Keyy Takeaways y 1
Slide 3: Key Highlights: Financial performance continues to improve
Key Highlights: Financial performance continues to improve Another Record Profit for FY2011 4Q11 PATAMI grew 26.5% YoY and 1.0% QoQ to RM1.15 billion. FY11 PATAMI grew 16.6% YoY to a record RM4.45 billion. FY11 revenue grew 8.9% YoY on the back 4.9% growth in fund based income and 15.3% grow
Slide 4: Key Corporate Developments
Key Corporate Developments Kim Engg Holdings g Limited is now a wholly‐owned y subsidiaryy of Maybank. y New organisation structure in place Leveraging on Kim Eng’s regional platform to score some early wins. Strengthening capital base. Implemented Dividend Reinvestment Plan twice, for fin
Slide 5: New House of Maybank has accelerated the pace for growth and regional reach
New House of Maybank has accelerated the pace for growth and regional reach All branches converted to one‐stop‐shops, one stop shops, providing Community comprehensive range of financial services including Financial serving Business Banking and SME customers. Services Extended network via Pos Ma
Slide 6: New House of Maybank has accelerated the pace for growth and regional reach (Cont'd)
New House of Maybank has accelerated the pace for growth and regional reach (Cont’d) EExpanded d d agency business. b i Insurance and Takaful Actively promoted single‐premium investment‐linked products through Bancassurance. Completed key IT infrastructure rollout rollout. New Head of Islami
Slide 7: Exceeding our KPIs for FY11
Exceeding our KPIs for FY11 Headline KPIs Target FY11 achievements Return on Equity 14% 15.2% Loans and Debt Securities Growth 12% 22.6% Other h targets Target FY11 achievements h Loans Growth • Malaysia 12% 16.8% • Singapore 5% 25.8% • BII 24% 25.8% Net Interest Margin Decrease Normalised: 2.71% ((
Slide 8: Executive Summary
Executive Summary Financial Performance Business Review Country Review Ki Eng Kim E Update U d Economic Update and Key Takeaways 7
Slide 9: 4Q11 PATAMI rose 26.5% YoY to RM1.15 billion
4Q11 PATAMI rose 26.5% YoY to RM1.15 billion Quarter Q RM million QoQ YoY 4Q11 3Q11 4Q10 Change Change Net interest income 1,826.7 1,771.4 3.1% 1,792.2 1.9% Income from Islamic Banking 443.0 387.8 14.2% 355.8 24.5% Net income from insurance business* 345.4 84.1 310.8% 168.6 104.9% Non-interest incom
Slide 10: FY11 PATAMI rose 16.6% YoY to RM4.45 billion
FY11 PATAMI rose 16.6% YoY to RM4.45 billion 12 M Months th RM million YoY FY11 FY10 Change Net interest income 7,185.9 6,770.9 6.1% Income from Islamic Banking 1,561.9 1,434.7 8.9% Net income from insurance business* 557.3 424.9 31.2% Non-interest income 4,114.7 3,692.7 11.4% Net income 13,419.8 12
Slide 11: Balance Sheet: Total Assets grew 22.4% YoY
Balance Sheet: Total Assets grew 22.4% YoY QoQ RM billion Jun 11 Mar 11 Jun 10 YoY Growth Growth Cash and short-term funds 38.8 32.0 28.7 35.2% 21.3% Deposits with Financial Institutions 10.3 8.5 8.9 15.4% 21.1% Securities purchased under resale agreements - 05 0.5 04 0.4 nm n.m. nm n.m. Securities
Slide 12: Gross loans grew 21.7% YoY, highest since FY01
Gross loans grew 21.7% YoY, highest since FY01 Overseas loans expanded by 29.4%. 29 4% Domestic loans grew 16.8%, 16 8% above industry growth of 13.5% on the back of Corporate loans growth of 25.6% QoQ YoY Growth RM billion Jun‐11 Mar‐11 Jun‐10 G Growth th Variance % Community Financial Services 114
Slide 13: Group deposits grew 19.0%, highest since FY07
Group deposits grew 19.0%, highest since FY07 Deposits saw double digit growth in Malaysia (20.8%) and Indonesia (31.3%) while Singapore deposits grew 6.4%. Malaysia Singapore BII Group YoY YoY YoY YoY RM bil SGD bil Rupiah tril RM bil Growth Growth Growth Growth Savings Deposits 31.4 11.4% 2.8 9.9%
Slide 14: Asset Quality continued to improve
Asset Quality continued to improve with loan loss declining by 59.0% to RM502.2 million and Net Impaired Loan ratio declining to 2.25% Allowance for losses on loans Net Impaired Loan Ratio 320.5 264.7 2.99% 2 83% 2.83% 2.74% 2.39% 2.25% ‐85.1% YoY 117.5 72.2 ‐33.9% QoQ 47.7 4Q10 1Q11 2Q11 3Q11 4Q11
Slide 15: Non-Interest Income grew 16.3% YoY to RM4.91 billion
Non‐Interest Income including Net Income from Insurance Business and Fee Income from Islamic operations grew 16.3% YoY to RM4.91 billion +11.4% 4,115 3,693 FY10 FY11 +12.8% 2,671 2,367 M million +48.4% ‐24.3% 24.3% +8.6% +11.2% +31.2% +127.1% RM 517 562 557 375 425 253 311 236 244 272 239 105 Total
Slide 16: Overheads grew 14.2% YoY
Overheads grew 14.2% YoY +14.2% YoY 6,652 Admin, general expenses & 4Q11 FY11 fees & brokerage Overhead Expenses Marketing expenses YoY QoQ YoY 5,826 PPersonnell costst 39.1% 39 1% 19.9% 19 9% 22.2% 22 2% IT Expenses 2,096 IT Expenses 49.7% 39.7% 6.4% Personnel costs Marketing expenses 148.6% ‐2.6%
Slide 17: Net interest margin: 2.71% on normalised basis
Net interest margin: 2.71% on normalised basis ‐9 bps p 0.01% 0 11% 0.11% 2.80% 2.70% 2.71% 2 59% 2.59% As reported FRS139 Normalised after Forex Normalised after FY10 NIM adjustments adjustments* FRS139 forex adjustments *Adjustments Adjustments for Effective Interest Rate and Unwinding of interest
Slide 18: Capital Adequacy remained strong
Capital Adequacy remained strong Capital Adequacy after Kim Eng acquisition and SGD1 billion sub sub‐debt debt Group 15.36% 14.81% 14.49% 14.72% 10.81% 10.88% 11.21% 11.84% 30 Jun 09 30 Jun 10 30 Jun 11* 30 Jun 11** Core capital ratio Risk‐weighted capital ratio * Full electable portion paid in cash
Slide 19: Consistently rewarding shareholders with high dividend payout ratio
Consistently rewarding shareholders with high dividend payout ratio Final dividend payout of 32 sen Net dividend of 24 sen = 3 sen cash portion + 21 sen electable portion Dividend Payout Ratio of 74.9% exceeds policy of 40 – 60% Gross Dividend (sen) and Payout Ratio (%) 76.5% 74.9% 70.0% 60.0%
Slide 20: Maybank Group: Key Ratios
Maybank Group: Key Ratios FY11 FY10 4Q11 3Q11 2Q11 1Q11 4Q10 Net Interest Margin 2.59%@ 2.80% 2.50% 2.57% 2.70% 2.69% 2.88% Return on Equity 15.2% 14.5% 15.1% 15.5% 15.7% 14.6% 13.3% Fee to Income Ratio 36.6% 33.4% 42.3% 33.8% 33.5% 31.7% 35.2% Cost to Income# 49.6% 47.3% 51.5% 49.0% 49.8% 47.6% 48.
Slide 21: Executive Summary
Executive Summary Financial Performance Business Review Country Review Kim Engg Update Economic Update and Key Takeaways 20
Slide 22: Revenue growth seen in all segments
Revenue growth seen in all segments: PBT growth led by CFS, GWB’s corporate banking and International +8 9% +8.9% Global Wholesale Banking (GWB) +19 1% +19.1% Revenue ((RM million) 13,420 FY10 FY11 12,323 +1.6% +21.2% 21 2% +4.2% 4 2% +104.6% 104 6% +11.4% 11 4% +22.4% 22 4% 6,225 6,130 4,178 1,280
Slide 23: Revenue Growth Contribution
Revenue Growth Contribution Net Financingg Income (including ( g Islamic Bankingg Income)) +0.6% Global Wholesale Banking (GWB) +6.1% FY10 +7.6% 4,632 4,660 FY11 +22.8% 22 8% ‐15.0% 15 0% +208.7% 208 7% +4.0% 4 0% 2,561 2,757 694 852 827 703 29 89 87 91 Community Financial Corporate Banking Global M
Slide 24: Revenue and PBT by geography
Revenue and PBT by geography Revenue Profit Before Tax Gross loans International: International: International: 4% 24% 5% 35% 32% 5% 6% 8% 16% FY11 14% RM6.27b 21% RM262.0b 12% RM13.42b 65% 68% 76% Malaysia Singapore 4% 16% 12% 68% Indonesia Others 3% 4% 5% 5% 8% 15% 15% FY10 19% 11% RM12.32b RM5.37
Slide 25: Community Financial Services: Mortgage Loans grew 11.6%
Community Financial Services: Mortgage Loans grew 11.6% with strong growth in loan stock Strong growth despite intense competition Asset quality continued to improve +11.6% +9.8% 38.6 +19.1% YoY 7.6% 34.6 31.5 5.0 4.2 5.4% 3.2 3.3% 30.4 33.6 28.2 +10.6% YoY Jun 09 Jun 10 Jun 11 Jun 09 Jun 10 Jun 11
Slide 26: Community Financial Services: Hire Purchase improved
Community Financial Services: Hire Purchase improved in loans growth and market share Hire purchase grew 14.3% in FY2011 Improved asset quality +14.3% Market share improved to No. No 2 in FY2011 from No. No 3 +12.7% 25.5 in FY2010 19.0% 22.3 18.8% 1.8% 18.0% 19.7 17.0% 17.6% 1.3% 16.9% 16.0% 15
Slide 27: Community Financial Services: Cards continued to grow
Community Financial Services: Cards continued to grow above market growth Cards Market Share Cards performance outperforming industry Jun 11 Jun 10 YoY Maybank Industry* Cardbase 17.56% 16.64% Cardbase ‐3.6% ‐8.7% Billings 22.65% 21.78% Billings 19.0% 14.4% Receivables 14.93% 14.41% Receivables 15.6
Slide 28: Business Banking and SME: Loans growth recovered to 4.7%
Business Banking and SME: Loans growth recovered to 4.7% Loans trended higher since September 2010 Strong deposits growth at 23.7% +23.7% YoY +4.7% YoY +2.5% QoQ +3.9% QoQ 70.2 71.9 64.7 26 0 26.0 58 1 58.1 58 9 58.9 RM billion RM billion 24.9 25.1 25.1 24.2 Jun 10 Sep 10 Dec 10 Mar 11 Jun 11 Jun 10
Slide 29: Global Wholesale Banking: Loans growth improved to 25.6%
Global Wholesale Banking: Loans growth improved to 25.6% Total GWB loans ((RM billion)) Increasingg Trade Finance Market Share Jun 11 94 9.4 +29 0% +29.0% 25 6% 25.6% Trade Finance Jun 10 7.3 23.4% 24.0% 22.5% 22.6% Short Term 20.6 +31.5% Jun 10 Sep 10 Dec 10 Mar 11 Jun 11 Revolving Credit & Overdra
Slide 30: Global Markets: Revenue growth supported by non interest income
Global Markets: Revenue growth supported by non interest income Growth in Revenue Credit Rating for Private Debt Securities in Malaysia +4 2% +4.2% 1.568.3 1,505.1 677 9 677.9 AAA 34.3% AAA, 34 3% RM million n 865.5 +27.7% A and below, 36.6% 827.2 702.8 ‐15.0% ‐AA AA to AA, AA FY10 FY11 29.1% Net in
Slide 31: Fee based income continued strong growth at 48.9%
Fee based income continued strong growth at 48.9% Fee based Income rose 48.9% YoY FY11 Fee‐based Income Segmentation g FY11 292.1 Miscellaneous Underwriting / fee income, Placement FY10 196.2 2% fees, 20% FY09 107 7 107.7 Agency / FY08 198.3 Brokerage, Arrangers' Guarantee 43% fees, 21% fees, 1% FY0
Slide 32: Investment Banking: Recent Notable Deals
Investment Banking: Recent Notable Deals Equity Capital Market Privatisation of Tanjong PLC via Voluntary Offer made by Tanjong Capital Sdn. Bhd. (RM8.79billion) Privatisation of Titan Chemicals Corporation Berhad via Mandatory General Offer made by Honam Petrochemical Corporation (RM4.06billion) Pr
Slide 33: Investment Banking: Recent Notable Deals
Investment Banking: Recent Notable Deals Debt Capital p Markets Government of Malaysia: Wakala Global Sukuk – Sovereign Sukuk Issuance (USD2.0 billion) Joint Book runner/Joint Lead Manager Genting Hong Kong Limited: Dim Sum Bonds (RMB1.38 billion) Joint Book runner/Joint Lead Manager Ranhill Power S
Slide 34: Maybank Islamic recorded strong financing growth of 35.1%
Within Group Islamic Banking business, Maybank Islamic recorded strong financing growth of 35.1% Group p Islamic Bankingg Income and PBT** Maybank Islamic financing (35.1% growth) Total Gross Financing = RM46.8 billion as at Jun 11 YoY RM million FY11 FY10 +21.8% +14.1% +72.6% Jun 10 Growth Jun 11 1
Slide 35: Etiqa: No. 1 Position in Life/Family and General Business
Etiqa: No. 1 Position in Life/Family (new business) and General Business Combined Gross Overall Loss Ratio Lower Than Industry Industry Premium Combined Combined… ‐6.8% 55.3% (Etiqa) vs. 59.5% (Industry) 59.5% Group Premium ‐13.9% Credit Premium ‐2.1% 19.8% 28.7% Jun 11 Fire 12.3% 33.4% Regular Prem
Slide 36: Executive Summary
Executive Summary Financial Performance Business Review Country Review Kim Eng Update Economic Update and Key Takeaways 35
Slide 37: Singapore: PBT improved 11.0%
Singapore: PBT improved 11.0% on higher fee income and lower provision Revenue and PBT rose 8% and 11% YoY respectively Diversified Loan Portfolio 22.0 Others (Consumer) YoY 1.0 SGD million FY11 FY10 17.5 3.3 Car Loans Growth 0.7 Consumer Housing Loans Net fund based income 454.5 468.6 ‐3.0% 3.3 5.0
Slide 38: BII: Profit before tax grew 28.8% YoY
BII: Profit before tax grew 28.8% YoY Income Statement Jul 10 10-Jun Jun 11 Jul 09-Jun 09 Jun 10 YoY Apr 11 11-Jun Jun 11 Apr 10 10-Jun Jun 10 YoY R Billion Rp Billi Contribution Contribution % Change Contribution Contribution % Change Interest income 7,349 6,065 21.2% 1,943 1,583 22.7% Interest exp
Slide 39: BII: Revenue grew 20.4% on 25.8% loans growth
BII: Revenue grew 20.4% on the back of 25.8% consolidated loans growth Group Revenue and PBT (Rp billion) for 1H11 (as reported in BII) Net Interest Margin +20.4% 3,153 2,619 5.89% ‐2.8% 5.63% 532 517 5.43% YTD Jun 10 YTD Jun 11 Revenue PBT J 10 Jun D 10 Dec J 11 Jun Jun’10 : before adoption SFAS No
Slide 40: BII: Branches and touch points expansion on track
BII : Branches and touch points expansion on track, asset quality continues to improve Branches and ATM Asset Quality Branches 1009 1017 952 3.52% ATM+CDM 893 806 844 3.09% 748 787 2.88% 743 2.57% 2.45% 1.97% 327 337 344 1.87% 274 295 1.74% 1.22% 255 255 255 260 1.40% Jun 09 Sep 09 Dec 09 Mar 10 Jun
Slide 41: WOM: 10.3% growth in revenue, PBT impacted by provisions
WOM : 10.3% growth in revenue, whilst PBT impacted by provisions Revenue and PBT (Rp billion) Unit Financing +10.3% (In 000 unit) 782 310 709 268 232 238 ‐96.6% 77 118 29 4 New Used Total YTD Jun 10 YTD Jun 11 YTD Jun 10 YTD Jun 11 Revenue PBT A t Quality Asset Q lit Financing Amount 2.43% 2.69% 2.1
Slide 42: MCB Bank: Financial Highlights
MCB Bank: Financial Highlights PBT ggrew due to higher g margins g and 21% Revenue and PBT increase in average earning assets, while non +27.4% interest income rose 37% mainly due to gain 26.5 from investment income and increase in fee +31.6% and commission income. 20.8 Loans grew mainly due to
Slide 43: An Binh Bank: Financial Highlights
An Binh Bank: Financial Highlights Revenue and PBT PBT declined due to higher loan loss provisioning +29.6% which has increased by 203% to VND 120.7 billion, 816.2 on the back of higher NPL ratio. However revenue increased by 29.6%, contributed 630.0 ‐14.6% by the increase in net net‐interest in
Slide 44: Executive Summary
Executive Summary Financial Performance Business Review Country Review Ki Eng Kim E Update U d Economic Update and Key Takeaways 43
Slide 45: Kim Eng is now wholly-owned subsidiary of Maybank
Kim Eng is now wholly‐owned subsidiary of Maybank 1 Maybank z Completed compulsory acquisition and delisted Kim Eng in August Shareholding in 2011 Kim Eng Holdings z Maybank now owns 100% of Kim Eng z Thailand: After the tender offer, Maybank now owns an aggregate 2 83.74% in Kim Eng Securities Thai
Slide 46: Kim Eng: Strategy Moving Forward
Kim Eng: Strategy Moving Forward The 5 regional g business pillars p Maybank’s Investment Banking Business Regional Financial Powerhouse Pillar 1 Pillar 2 Pillar 3 Pillar 4 Pillar 5 Investment Banking and Equity and Equities – Retail Equities – Institutional Asset Management Advisory Commodity Solut
Slide 47: High-level synergies
High‐level synergies z Maybank IB and Kim Eng have already worked on a number of deals together: Loan syndication in Maybank‐IB Philippines, IPOs for Bumi Armada, Eversendai and MSM and also begun offering Malaysian stocks to Kim Eng clients and ex‐Malaysia stocks to Maybank IB clients Revenue syner
Slide 48: Executive Summary
Executive Summary Financial Performance Business Review Country Review Kim Eng Update Economic Update and Key Takeaways 47
Slide 49: Malaysia: Sustained growth for 2011
Malaysia: Sustained growth for 2011 Growth to be sustained at 5.1% in 2011 & 5.5% in 2012 (2010: 7.2%) Inflation expected to rise to 3.4% in 2011 (2010: 1.7%) Quarterly GDP and annual growth rate CPI and components (% YoY) Q2 GDP: 14 25 July CPI: 20 +4% YoY 12 +3.4% YoY 15 10 Transport (RHS) 10 8 5
Slide 50: Malaysia: Banking Sector
Malaysia: Banking Sector Total Loans grew 13.5% YoY for June 2011 Total Deposits grew 11.5% YoY for June 2011 Total Loans Total Loans YoY Growth 1250 25% Total Deposits Total Deposits YoY Growth Household YoY Growth Business YoY Growth 1200 950 18% 1150 20% 900 16% 1100 billion RM billion 850 14% 10
Slide 51: Singapore: Economic Growth to Moderate
Singapore: Economic Growth to Moderate ■ GDP growth for 2011 is forecast to be between 5.0%5 0% – Real GDP ggrowth for 2011 expected p to be 5% – 6% 6.0% as conditions across the region’s supply chain (2010: 14.5% ) normalise. ■ Inflation rate for 2011 forecast at 4.0% – 5.0%. Core inflation, which
Slide 52: Indonesia: Continued Growth
Indonesia: Continued Growth ■ 2011 GDP ggrowth expected p to reach 6.3%,, higher g Real GDP Growth: growing faster than the growth of 6.1% in 2010 ■ Inflation rate for 2011 is expected to reach 5.5% due 7.50 (y-y %) to easing food price pressure. Thus, BI Rate is 7.00 6.49 expected to stay at 6.75%
Slide 53: Priorities for the next 12 months
Priorities for the next 12 months 1 1. Grow loans and deposits with pricing discipline discipline. 2. Reinforce community banking focus for distribution channels. Address fundamentals for SME to gear‐up for growth. 3 3. IIntensify if client li coverage collaboration ll b i with i h product d partner
Slide 54: Refreshing the Maybank brand
Refreshing the Maybank brand • Existingg Maybank y corporate p identity/logo y g has been in use since earlyy 1990s. Timely to refresh to reinforce the significant progress made and impending rebranding of our newly acquired entities. g on Maybank's • Better leverage y brand equity q y throughg more
Slide 55: Key Performance Indicators (KPIs) for financial year ending 31 Dec 2011
Key Performance Indicators (KPIs) for financial year ending 31 Dec 2011 Headline KPIs Return on Equity 16% Loans and Debt Securities Growth 12% Other KPIs Group Loans Growth 12% Malaysia 12% Singapore 8% BII 24% Group Deposits Growth 14% RWCR >12% Note: Loans growth for Singapore and BII are in loca
Slide 56: Prospects
Prospects Economic ggrowth supportive pp of loans growth g in 3 home markets. Group’sp business momentum expected to remain robust despite challenging global economic conditions and outlook, rising interest rates, inflation, and stiffer competition. Loans ggrowth in Malaysia y to be led byy corp
Slide 57: Key Takeaways and Conclusion
Key Takeaways and Conclusion Another record earnings year, with broad based growth and profitability. New House of Maybank has accelerated the pace for growth and regional reach. High Dividend Payout Ratio of 74.9% with a DRP, whilst dividend policy is maintained between 40% to 60%. Financia
Slide 58: Maybank: Where we are today
Maybank: Where we are today 51 Total Assets RM412 BILLION Profit After Tax Years Of Growth RM4.45 BILLION Human Capital 42,000 MAYBANKERS WORLDWIDE Global Network 2 100 O 2,100 OFFICES C S IN 17 COUNTRIES Customers > 21 MILLION CUSTOMERS Public Ownership > 10 10.5 5 MILLION UNITHOLDERS 57
Slide 59: Thank You
Thank You Disclaimer. This presentation has been prepared by Malayan Banking Berhad (the “Company”) for information purposes only and does not purport to contain all the information that may be required to evaluate the Company or its financial position. No representation or warranty, express or impl
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