Diamond Trust Bank Kenya Ltd. · NSEKE:DTK
Diamond Trust Bank Kenya — Q1 2021 Earnings Presentation
49 slides from Diamond Trust Bank Kenya's earnings presentation, 2021
Slide 1: Investor Presentation Q1 2021
INVESTOR Q1 2021 PRESENTATION
Slide 2: Agenda
➢ Who We Are ➢ Macro Economic Highlights ➢ DTB’s Response to COVID-19 ➢ DTB’s Strategy- DTB Vision 2020 ➢ DTB’s Strategy- DTB Strategy 2030 and Beyond ➢ DTB’s Recognition ➢ Managing Risks and Building Resilience ➢ Remodeling the Business Pivoting to Digital ➢ Financial Performance ➢ DTB 2020 Integra
Slide 3: Who We Are
WHO WE ARE To make our Enabling people to customers prosper, advance with our staff excel and confidence and create value for our success stakeholders. Integrity - Be Ethical and Fair • We honour our commitments and do what is right Progressive - Innovate and Challenge • We are fair, respectful and
Slide 4: DTB Group Structure
DTB GROUP STRUCTURE as at March 2021 DTB’s Response to Macro Economic DTB’s Strategy Managing Risks Remodeling the Business Financial Who We Are COVID-19 Outlook 4 Highlights and Building Resilience Pivoting to Digital Performance
Slide 5: DTB's Footprint
DTB’S FOOTPRINT as at March 2021 8% 1% year on year year on year growth decline 650,623 134 Customers Branches : 260,536 : 167,493 : 69 : 33 : 219,722 : 2,872 : 28 :4 4% - year on year No change 2,208 decline 160 year on year Employees : 1,023 : 602 ATMs : 67 : 56 : 536 : 47 : 37 DTB’s Response to M
Slide 6: What Differentiates Us
WHAT DIFFERENTIATES US Commitment to a Diversified distribution sustained organisation- channels and footprint. wide culture of service Diamond Trust Bank (DTB) is a leading, Tier I excellence. Extensive product East African commercial bank headquartered in range, with growing Nairobi, Kenya and lis
Slide 7: Macro-Economic Highlights
MACRO- ECONOMIC HIGHLIGHTS 7
Slide 8: Macro-Economic Highlights - East Africa
MACRO- ECONOMIC HIGHLIGHTS- EAST AFRICA GDP Growth 7.6% 6.3% 2.7% 2.8% 1.0% -0.1% Kenya Tanzania Uganda Burundi -1.3% -2.1% 2020 Expected 2021 Source: IMF World Economic Outlook April 2021 Exchange Rate to USD Uganda 3762.9 3,665.0 3% Tanzania 2296.5 2,319.0 1% Burundi 1876.0 1,947.4 4% Kenya 104.3
Slide 9: Macro-Economic Highlights - Kenya
MACRO- ECONOMIC HIGHLIGHTS- KENYA Inflation, CBR and 91-Day T-Bills rate (%) Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Source: CBK March 2021 CBR Inflation 91 day T-Bills ▪ CBR is only applicable to 30% of the Banks’ legacy Kenya Shilling denominated loans s
Slide 10: DTB's Response to COVID-19
DTB’s RESPONSE TO COVID-19 Relief to MSME Credit Pivoting to Capital Liquidity Citizenship Borrowers Access Digital Buffers Buffers Committed the Repayment Partnered with the Waived fees on Given the global Boosted DTB’s equivalent of over holidays granted National Treasury mobile banking and region
Slide 11: DTB's Approach to Sustainability
DTB’s APPROACH TO SUSTAINABILITY DTB’s approach to sustainability involves connecting directly with people and making a lasting impact on their lives. DTB gives careful consideration to the impact of our business activities on the interests of our stakeholders— customers, employees, the larger commu
Slide 12: DTB's Strategy - DTB Vision 2020
DTB’s STRATEGY- DTB VISION 2020 DTB Vision 2020 envisioned DTB as a leading commercial bank and a significant participant in the economies where it operates: ➢ Rank among the top tier banks by liabilities ➢ Be a sustainable deposit led bank (CASA) ➢ Play a leading role in transitioning economies to
Slide 13: DTB Strategy 2030 and Beyond
DTB’s STRATEGY- DTB STRATEGY 2030 AND BEYOND DTB Strategy 2030 and Beyond: under review and modification: ➢ will take into account the changing environment and customer behaviour, including the ongoing effects of the unexpected COVID-19 pandemic and the post- pandemic business landscape. ➢ will be a
Slide 14: DTB's Recognition
DTB’S RECOGNITION WINNERS RUNNERS UP ➢ Best Bank in Customer ➢Best Bank in Mobile Banking (of 4 participants). Satisfaction- Tier I ➢Best Bank in Asset Finance (of 9 participants) (of 3 participants). ➢ Best Bank in SME Banking ➢Best Bank in Product Innovation (of 11 participants) (of 6 participants
Slide 15: Managing Risks and Building Resilience
MANAGING RISKS AND BUILDING RESILIENCE 15
Slide 16: Sector-wise Restructures - Group
SECTOR-WISE RESTRUCTURES- Facilities Restructured Relating to GROUP COVID-19 (Q1 2021) 3% 2% 6% 4% 5% 1% 0% 23% 8% 0% 26% 7% 8% Overall Loan Facilities 8% Book Restructured KShs 219 Bn 7% KShs 72 Bn 19% 14% 14% 29% 16% 33% of the loan • Moratorium of up to 12 months. book on • Extension of tenor. re
Slide 17: Sector-wise Restructures - Kenya
SECTOR-WISE RESTRUCTURES- Facilities Restructured Relating to KENYA COVID-19 (Q1 2021) 2% 2% 3% 8% 5% 22% 2% 0% 2% 0% 8% 30% 8% Overall Loan Facilities 8% 8% Book Restructured KShs 166 Bn KShs 62 Bn 21% 13% 13% 29% 16% 37% of the loan • Moratorium of up to 12 months. book on • Extension of tenor. re
Slide 18: Sector-wise Analysis of Loan Book and NPAs - Group
SECTOR-WISE ANALYSIS OF LOAN BOOK AND NPAs- GROUP 47.5 Q1 2021 (%) 23.3 27.3 18.5 16.1 14.2 10.6 7.7 7.0 4.8 1.5 5.0 1.8 3.8 5.3 3.2 0.1 0.2 1.2 0.2 0.7 0.0 Trade Real Estate Manufacturing Tourism Transport and Agriculture Building & Personal Financial Energy & Mining communication Construction Hous
Slide 19: Balance Sheet Highlights - Group
BALANCE SHEET HIGHLIGHTS- GROUP Provision Movement Provision Split (KShs Mn) (KShs Mn) 10,118 4,510 1,609 1,763 1,329 1,174 Q1 2020 Q1 2021 Stage 1 Stage 2 Stage 3 DTB’s Response to Macro Economic DTB’s Strategy Managing Risks Remodeling the Business Financial 19 Who We Are COVID-19 Outlook Highligh
Slide 20: Non Performing Loans & Coverage Ratios - Group
NON PERFORMING LOANS & COVERAGE RATIOS- GROUP NPA Ratio Evolution (%) 14.1 14.1 (April 2021) 12.5 11.9 11.9 10.3 10.2 8.3 7.9 NPL ratio stable and below industry average. 3.4 1.3 0.8 Q1 2020 FY 2020 Q1 2021 Industry Gross NPA Ratio (Kenya) Group Gross NPA Ratio Group COR Kenya Gross NPA Ratio Specif
Slide 21: Evolution of Non Performing Accounts (NPA)
EVOLUTION OF NON PERFORMING ACCOUNTS (NPA) Evolution of NPAs (Gross of Interest in Suspense) + Coverage Ratio (Specific Provision/ NPAs Coverage Ratio) (%) 10.3% 10.2% 22.8 22.9 8.3% 8.2% 11.9% 11.9% 7.9% 19.7 19.8 8.8% 18.0 8.6% 17.5 8.3% 16.6 KShs Bn 14.6 13.9 13.3 46.5% 54.7% 51.2% 44.6% 57.2% 45
Slide 22: Loan Book Performance - Non Performing Accounts
LOAN BOOK PERFORMANCE- NON PERFORMING ACCOUNTS (NPA) Top 10 NPAs as a % of Total NPAs 72% Mar-21 81% 75% Dec-20 83% 58% Sep-20 70% 62% Jun-20 72% 64% Mar-20 72% Group Bank DTB’s Response to Macro Economic DTB’s Strategy Managing Risks Remodeling the Business Financial 22 Who We Are COVID-19 Outlook
Slide 23: Strong Capital Buffers
STRONG CAPITAL BUFFERS Core Capital to RWA (%) Total Capital to RWA (%) Kenya Kenya 20.7 20.8 22.5 22.4 19.3 21.0 14.5 14.5 14.5 10.5 10.5 10.5 Q1 2020 FY 2020 Q1 2021 Q1 2020 FY 2020 Q1 2021 Min Total Capital/RWA Total Capital /RWA Min Core Capital/RWA Core Capital /RWA Adequate Group Group capital
Slide 24: Liquidity
LIQUIDITY Liquidity (%) Kenya 58.7 54.7 56.0 Stable liquidity levels across the 20.0 20.0 20.0 Group Q1 2020 FY 2020 Q1 2021 Min. Liquidity (Statutory) DTB Kenya Group 56.3 56.3 59.5 Draw down of USD 100 million from Development Financial Institutions: 20.0 20.0 20.0 IFC- USD 50 million, AfDB- USD 4
Slide 25: Remodeling the Business Pivoting to Digital
REMODELING THE BUSINESS PIVOTING TO DIGITAL 25
Slide 26: Channel Performance - Q1 2021
CHANNEL PERFORMANCE- Q1 2021 Group Kenya 9% Branches 85% of transactions done outside branches 91% of transactions done outside branches 15% Branches Over 84% of DTB’s retail 88% of mobile banking KShs 140 million customers subscribe to subscribers use the foregone in mobile mobile banking. channel
Slide 27: Merging Branches
MERGING BRANCHES ➢ In line with DTB’s digital strategy, the ➢ Below is a list of the branches that will be merged: Bank has responded to the shift to Branch to be Merged Receiving Branch Last Date of Operation digital channels by merging some of its Jamhuri Street Branch Malindi Branch 30 June 2021
Slide 28: DTB Mobile Banking - m24/7
DTB MOBILE BANKING- m24/7 Using m24/7 mobile banking platform our customers can: ➢ open a Bank 24/7 digital account in under 5 minutes. ➢ make seamless payments to settle their credit card balances. ➢ worry less about security by authenticating transactions using leading biometrics such as facial re
Slide 29: Channel Performance - Kenya Mobile Banking
CHANNEL PERFORMANCE- KENYA MOBILE BANKING No. of Mobile Banking (m24/7) Transactions (Mn) 9.4 5.4 m24/7 transaction count up by 74% Q1 2020 Q1 2021 Value of m24/7 Transactions (KShs Bn) 34.7 m24/7 transaction values up by 114% 16.2 Q1 2020 Q1 2021 Macro Economic DTB’s Response to Remodeling the Busi
Slide 30: Channel Performance - Kenya
CHANNEL PERFORMANCE- KENYA Mobile Banking Transaction type (% value) Over KShs 60 bn transferred through the m24/7 channel from 59.5% Jan 2021 to Mar 2021. 44.5% Customers deposits using mobile platforms 22.7% up by 3X 20.0% 16.9% 15.5% 13.4% 6.7% 0.4% 0.4% B2B B2C C2B FUNDS TRANSFER BILL PAYMENTS Q
Slide 31: DTB Internet Banking - i24/7
DTB INTERNET BANKING- i24/7 Using i24/7 our internet banking platform, is a ‘walk in the park’ experience for our customers as they can: ➢ pay their taxes real time on KRA’s iTax portal. ➢ no longer queue in long lines to pay bills to Kenya Power and Nairobi Water. ➢ easily transfer foreign currency
Slide 32: Channel Performance - Kenya Internet Banking
CHANNEL PERFORMANCE- KENYA INTERNET BANKING No. of Internet Banking (i24/7) Transactions (Thousands) 223 i24/7 transactions up by 120 86% Q1 2020 Q1 2021 Average of 3,480 transactions done per business day on i24/7 Value of i24/7 Transactions (KShs Bn) 47 i24/7 transaction 27 values up by 74% Q1 202
Slide 33: Channel Performance - Kenya
CHANNEL PERFORMANCE- KENYA No. of POS Acquiring Transactions (Thousands) 162 120 POS transaction count up by 35% Q1 2020 Q1 2021 Value of POS Acquiring Transactions (KShs Bn) 900 POS transaction value up by 814 11% Q1 2020 Q1 2021 Macro Economic DTB’s Response to Remodeling the Business Financial Wh
Slide 34: Channel Performance - Kenya
CHANNEL PERFORMANCE- KENYA No. of ATM Transactions (Thousands) 299 Decline in number of 234 ATM transactions by 22% Increased Q1 2020 Q1 2021 shift to cashless Value of ATM Transactions (KShs Bn) transactions 2.8 2.3 ATM transaction value down by 18% Q1 2020 Q1 2021 Macro Economic DTB’s Response to
Slide 35: Financial Performance
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Slide 36: Balance Sheet Highlights - Group
BALANCE SHEET HIGHLIGHTS- GROUP Q1 2020 Q1 2021 Net Loans & KShs 201 Bn KShs 206 Bn 2% Advances Gov- KShs 127 Bn KShs 152 Bn 20% ASSETS Securities Total KShs 385 Bn KShs 417 Bn 8% Assets Customer KShs 273 Bn KShs 302 Bn 11% LIABILITIES Deposits Macro Economic DTB’s Response to Managing Risks Remodel
Slide 37: Balance Sheet Highlights - Funding, Liquidity and Capital
BALANCE SHEET HIGHLIGHTS- FUNDING, LIQUIDITY AND CAPITAL GROUP Funding Liquidity (%) Capital (%) 5% 4% 17% 17% 59.5 21.1 2% 2% 20.2 4% 6% 56.3 19.7 19.7 18.4 18.0 14.5 14.5 14.5 72% 10.5 10.5 10.5 71% 20.0 20.0 Q1 2021` Q1 2020 Q1 2020 Q1 2021 Q1 2020 FY 2020 Q1 2021 Customer Deposits Deposits from
Slide 38: Balance Sheet Highlights - Kenya
BALANCE SHEET HIGHLIGHTS- KENYA Q1 2020 Q1 2021 Net Loans & KShs 152 Bn KShs 155 Bn 2% Advances Gov- KShs 94 Bn KShs 114 Bn 21% ASSETS Securities Total KShs 286 Bn KShs 305 Bn 7% Assets Customer KShs 191 Bn KShs 212 Bn 11% LIABILITIES Deposits Macro Economic DTB’s Response to Managing Risks Remodeli
Slide 39: Total Assets - Subsidiaries Contribution
TOTAL ASSETS- SUBSIDIARIES CONTRIBUTION (%) Q1 2021 15% 12% 0.9% 1% 0.1% 72% 0% DTB Kenya DTB Tanzania DTB Uganda DTB Burundi DTBI Macro Economic DTB’s Response to Managing Risks Remodeling the Business Financial Who We Are DTB’s Strategy Performance Outlook 39 Highlights COVID-19 and Building Resil
Slide 40: Net Loan Book - Contribution by Subsidiaries
NET LOAN BOOK- CONTRIBUTION BY SUBSIDIARIES 76% 75% 16% 16% 7% 8% 1% 1% DTB Kenya DTB Tanzania DTB Uganda DTB Burundi Q1 2020 Q1 2021 Macro Economic DTB’s Response to Managing Risks Remodeling the Business Financial Who We Are DTB’s Strategy Performance Outlook 40 Highlights COVID-19 and Building Re
Slide 41: Customer Deposits - Contribution by Subsidiaries
CUSTOMER DEPOSITS- CONTRIBUTION BY SUBSIDIARIES Q1 2021 17% 12% 70% 1% DTB Kenya DTB Tanzania DTB Uganda DTB Burundi Macro Economic DTB’s Response to Managing Risks Remodeling the Business Financial Who We Are DTB’s Strategy Performance Outlook Highlights COVID-19 and Building Resilience Pivoting to
Slide 42: Deposit Mix Group Q1 2021
DEPOSIT MIX GROUP Q1 2021 Kenya 29% 60% 61% 9% 1% Fixed Call Savings Current Group 32% 54% 13% 1% Macro Economic DTB’s Response to Managing Risks Remodeling the Business Financial Who We Are DTB’s Strategy Performance Outlook Highlights COVID-19 and Building Resilience Pivoting to Digital 42
Slide 43: P&L Highlights
P&L HIGHLIGHTS Kenya Q1 2021 Q1 2020 Group NIM 3.3 Bn 3.2 Bn Net Interest 5.0 Bn 4.7 Bn 5% Income 6% NIM 4.9% 5.0% 5.2% 5.4% Total Non- 0.9 Bn 0.9 Bn Interest 1.6 Bn 1.6 Bn 1.1% Income -2% ROE Gross ROE 4.2 Bn 4.1 Bn Operating 6.5 Bn 6.3 Bn 12.3% 12.2% 1% 4% Income 12.3% 12.8% 1.5Bn 1.5 Bn Operating
Slide 44: P&L Highlights Group
P&L HIGHLIGHTS GROUP Operating Expenses Credit Impairment 3,500 47.0% (KShs Mn) 46.5% 13,055 46.4% 3,000 46.0% 2,500 45.5% 10,118 45.0% 2,000 44.5% 7,448 44.0% 1,500 43.5% 43.5% 4,510 1,000 43.0% 2,937 2,938 42.5% 500 42.0% 0 41.5% Q1 2020 Q1 2021 Credit Impairment General Provision Specific Provisi
Slide 45: P&L Highlights - Subsidiary PBT Contribution
P&L HIGHLIGHTS Subsidiary PBT Contribution (KShs Mn) 1% 42 BR 1% 34 2% DTBI 50 2% 53 16% of Group UG 8% 228 153 5% PBT contributed by subsidiaries 5% 155 TZ 6% 354 84% 2,516 KE 86% 2,360 Actual Mar 21 Actual Mar 20 Better top line performance by Uganda has caused the subsidiary contribution to impro
Slide 46: Key Financial Ratios
KEY FINANCIAL RATIOS Actual Actual Actual Actual March March March March Kenya 2021 2020 2021 2020 Group Return on Equity 12.3% 12.2% 12.3% 12.8% Return on Asset 2.2% 2.2% 2.0% 2.1% NPL Ratio 11.7% 6.9% 10.2% 6.7% NPL Coverage 45.2% 32.0% 44.5% 33.5% Ratio Cost of Risk 0.7% 0.5% 1.3% 0.8% Fee Income
Slide 47: Outlook
OUTLOOK ➢ Cautious optimism on economic rebound. ➢ Accelerated rate in balance sheet growth in 2021. ➢ NIMS broadly similar to 2020. ➢ Continued efforts to reduce DTB’s cost of funds. ➢ Lower interest yield. ➢ Continued focus on fee income driven by digital products and services offerings. ➢ Overhea
Slide 48: DTB 2020 Integrated Report & Financial Statements
DTB 2020 INTEGRATED REPORT & FINANCIAL STATEMENTS Scan here to view the Bank’s 2020 Integrated Report on our website for financial performance and other qualitative information. Macro Economic DTB’s Response to Managing Risks Remodeling the Business Financial Who We Are DTB’s Strategy Outlook Highli
Slide 49: We welcome all feedback via email
We welcome all feedback via email on dtbinvestorrelations@dtbafrica.com
Diamond Trust Bank Kenya — Q1 2021 Earnings Presentation on 6ix