First Abu Dhabi Bank · ADX:FAB
First Abu Dhabi Bank — Debt Investor Presentation (May 2023)
53 slides from First Abu Dhabi Bank's debt investor presentation, May 2023
Slide 1: Debt Investor Presentation May 2023
Debt Investor Presentation May 2023
Slide 2: Disclaimer
Disclaimer • Comparative figures have been reclassified where appropriate to conform to the presentation and accounting policies adopted in the consolidated financial statements • Integration of Bank Audi Egypt into FABMisr was completed in Q4’22. FABMisr is grouped under Head Office on an interim b
Slide 3: The UAE's leading bank, and one of the world's largest and safest financial institutions
The UAE’s leading bank, and one of the world’s largest and safest financial institutions 3
Slide 4: We are the UAE's leading bank, and one of the world's largest and safest financial institutions
We are the UAE’s leading bank, and one of the world’s largest and safest financial institutions UAE’s Leading Bank and Regional Banking Powerhouse Amongst Safest and Strongest Banks Globally Largest Bank in the UAE and A Market Heavyweight, among the Safest banks rankings2 AA- amongst the Largest in
Slide 5: Our strategic international network facilitates cross-border liquidity, trade and investment flows
Our strategic international network facilitates cross-border liquidity, trade and investment flows Diversified revenues across geographies Europe and Americas UAE 77% France I UK I Switzerland USA I Brazil USD Middle East and Africa UAE | Egypt | KSA I Oman 1.8 Bn Bahrain | Kuwait | Libya | Iraq Asi
Slide 6: Among the most profitable AA- rated banks globally
Among the most profitable AA- rated banks globally 25% Al Rajhi TDBank**** Western banks GCC banks Scotia**** APAC banks Macquarie* 20% RBC**** JP Morgan Mashreq QNB ENBD SNB HDFC Bank* NBK Return on Tangible Equity (%) DBS Morgan Stanley BofA CBA** 15% KFH ICICI* UBS Swedbank ADCB Lloyds CBQ Nordea
Slide 7: Leading UAE and regional banking powerhouse
Leading UAE and regional banking powerhouse Q1’23 Banking sector assets1 National Net Profit2 Total Assets2 Equity2 Market Cap4 Credit Ratings4 (USD Bn) champion2,3 (USD Bn) (USD Bn) (USD Bn) (USD Bn) (Moody’s/S&P/Fitch) 999 1.1 323 30.5 38.7 Aa3 / AA- / AA- UAE 974 1.3 259 45.4 54.7 A1 / A- / A- KS
Slide 8: Diversified and client-centric business model
Diversified and client-centric business model Corporate & Investment Consumer Global Private Commercial Banking Banking Banking Banking % Group operating 39% 25% 12% 4% income (Q1’23) Offers banking & financing solutions, Diversified products offering across Product ranges offered include Offers a d
Slide 9: Diversified franchise by business segment and geography
Diversified franchise by business segment and geography Breakdown by Business Breakdown by Geography Investment Banking Corporate & Commercial Banking Consumer Banking Global Private Banking UAE International Head Office3 Operating Income Profit after taxes Operating Income Profit after taxes Q1’23
Slide 10: A Regional Pacesetter for Sustainability and Climate Action
A Regional Pacesetter for Sustainability and Climate Action 10
Slide 11: A Regional High Performer on Sustainability
A Regional High Performer on Sustainability ENTITIES BEST SCORE WORST PEER COMPARISON 0 10 20 30 40 80+ Top 30% Banks 22.6 Worldwide AAA AA A BBB BB B CCC Average score A among Banks INDUSTRY RELEVANCE Worldwide A A- B B- C C- D D- Second best D score in the Middle East 100 75 50 25 0 Top 20% Banks
Slide 12: Delivering against our sustainability agenda
Delivering against our sustainability agenda FY’22 ESG Performance at a Glance TRANSITIONING CAPITALISING TRANSFORMING to a Low Carbon Future on our Social Responsibility our Governance Model GREEN FINANCE FINANCIAL INCLUSION GOVERNANCE STRUCTURE & RISK FRAMEWORK Established a Board Risk & ESG Commi
Slide 13: We are committed to become a net zero bank by 2050
We are committed to become a net zero bank by 2050 Our timeline to net zero In 2022, we have set production-based carbon intensity targets across three of our highest emitting sectors. Our targets are in line with the emissions reduction trajectory required to reach the International Energy Agency’s
Slide 14: Shaping the Future
The Regional Financial SHAPING Institution of Choice. THE Strategically Driven ACTING WITH PURPOSE FUTURE Value - Driven DELIVERING SUSTAINABLE GROWTH Forward - Driven With purposeful action MOVING BEYOND TRADITIONAL BANKING for sustainable growth 14
Slide 15: Good progress against our strategic priorities in Q1'23
Good progress against our strategic priorities in Q1’23 ✓ Strong deal pipeline execution and commercial momentum across several areas ✓ Strength in fee-based business, enhanced cross-sell, driving further income growth and diversification 1 STIMULATE ✓ Offering innovative solutions to our clients, l
Slide 16: Leveraging technology and strategic partnerships to drive sustainable growth
Leveraging technology and strategic partnerships to drive sustainable growth IMPROVED SELF-SERVICE CAPABILITIES ENHANCING CUSTOMER EXPERIENCE ENHANCED EFFICIENCY AND PRODUCTIVITY USING DIGITAL1 • Fully digital application process for current account and credit card applicants ~ Account opening withi
Slide 17: Q1'23 Financial Performance
Q1’23 Financial Performance 17
Slide 18: Q1'23 Key Performance Highlights
Q1’23 Key Performance Highlights Key Financial Highlights ❑ Strong start to 2023 Net profit 1.1 ▲ USD Bn 70% 60% YoY1 QoQ • Group Revenue +51% YoY1 and +14% QoQ driven by sustained momentum across all business segments, enhanced income generation across products and geographies • Q1’23 NPAT at USD 1
Slide 19: High double-digit earnings growth driven by sustained business activity
High double-digit earnings growth driven by sustained business activity, benefits from higher interest rates, and enhanced income generation across a diversified franchise Q1’23 Summary P&L Net profit bridge YoY (USD Mn) in USD Mn Q1’23 QoQ% YoY%1 +70% YoY1 Excluding Magnati-related capital gains in
Slide 20: Sustained business momentum with solid operating performance across segments
Sustained business momentum with solid operating performance across business segments and product lines Operating income bridge (USD Mn) Net interest income bridge (USD Mn) Non-interest income bridge (USD Mn) +51% YoY YoY ↑41% YoY ↑74% +214 1,832 +200 +5 +93 1,205 +122 627 +183 +10 853 +101 +136 +23
Slide 21: Solid balance sheet fundamentals supported by strong liquidity and healthy loan growth
Solid balance sheet fundamentals supported by a strong liquidity position and healthy loan growth Loans (net) increased 3% Ytd (USD 4Bn) driven by sustained demand from our core clients across the corporate Asset Mix - Dec’22 +7%QoQ Asset Mix - Mar’23 & private sectors, and growth in trade finance l
Slide 22: A well-diversified, high quality loan book
A well-diversified, high quality loan book Figures in USD Bn Gross loans trend Gross loans by counterparty QoQ ↑3%, YoY ↑9%, 130.6 134.5 Trade-related 16% 16% 130.1 131.9 130.6 134.5 Personal/ Retail 123.3 Corporate/ Private 52% 52% Banks 1% 3% Public Sector 9.3 8.2 9.9 9.2 11.8 19% 17% Government 1
Slide 23: Increase in NII driven by growth in business volumes and higher interest rates
Increase in NII driven by growth in business volumes and higher interest rates Net interest income (USD Bn) • Increase in NII by 5% qoq and 41% yoy was driven by growth in Performing loan yields (%) business volumes and margin improvements from effective balance Quarterly YTD QoQ ↑5%, YoY ↑41% sheet
Slide 24: Strength in fee-based businesses drives non-interest income growth
Strength in fee-based businesses, significantly higher FX gains and a healthy sales & trading performance, drive non-interest income growth Fees & commissions, net (USD Mn) Non-interest income Q1’23 Q4’22 QoQ% Q1’22 YoY% Loan-related Trade-related Other (In USD Mn) QoQ ↑15%, YoY ↑1% Non-interest inc
Slide 25: C/I ratio improvement reflects revenue growth and cost discipline
C/I ratio improvement reflects revenue growth and cost discipline amidst continued investments to support business growth Operating expenses trend (USD Mn) and C/I ratio (%) Opex drivers YoY (USD Mn) C/I ratio1 33.2 31.2 33.4 28.7 25.1 +11% YoY QoQ ↓16%, YoY ↑11% +15 460 +8 545 +24 460 413 433 436 4
Slide 26: Healthy asset quality metrics with stable NPL ratio, adequate provision buffers
Healthy asset quality metrics with stable NPL ratio, adequate provision buffers Impairment charges, net (USD Mn) & CoR1 (%) NPLs2 and ECLs3 (%) Net impairment charges CoR (L&A) (bps) Provision Coverage (%) NPL Ratio (%) NPLs (USD Bn) Provisions (USD Bn) 86 102 100 103 98 101 60 62 42 52 3.8 3.6 3.9
Slide 27: Healthy asset quality and adequate provision buffers
Healthy asset quality and adequate provision buffers NPLs1 by segment NPLs1 by sector (%) (USD Bn) Corporate (IB + CCB) Retail (CB + GPB) 5.3% 5.5% 5.5% 5.3% 5.4% Real Estate & Construction, 45% NPL ratio 3.4% 3.1% 3.0% 3.6% 3.5% Manufacturing, 3% 4.6 4.6 4.4 5.0 5.0 Energy, 5% USD 5.0Bn 24% 24% Mar
Slide 28: Capital, funding & liquidity
Capital, funding & liquidity 28
Slide 29: Strong capital generation and RWA discipline
Strong capital generation and RWA discipline CET11 ratio progression RoRWA4 (%ytd) and RWAs (USD Bn) 3.6 2.8 2.5 2.8 2.3 Cash DPS: USD 0.14 595 583 584 572 568 USD 1.57Bn 6% 5% 6% +69bps +9bps -21bps 9% 10% 8% 6% 6% 7% 7% 1.00% • RWA • Adverse 13.0% 13.1% optimisation movement in 13.2% 85% 85% 86% 8
Slide 30: High-quality and diversified investment portfolio
High-quality and diversified investment portfolio Investments by type Investments by ratings Mar’23 Dec’22 Mar’23 Mar’23 Dec’22 USD 57.0Bn AAA 24% 24% Mar’23 FVTPL - Debt 17% 14% USD 57.0Bn AA 26% 23% Dec’22 FVTPL - Equity & Funds 2% 2% USD 56.0Bn A 25% 26% Amortised Cost (Debt Inv) 2% 2% BBB 7% 7%
Slide 31: Strong deposit inflows in Q1'23 underline franchise strength
Strong deposit inflows in Q1’23 underline franchise strength and superior credit ratings Customer deposits trend Customer deposits by counterparty QoQ ↑11%, YoY ↑30% 190.8 212.5 Total Customer Deposits CASA Certificates of deposits 5% 4% 212.5 14% 13% 203.1 190.8 Personal/retail sector 163.4 176.5 3
Slide 32: Leading issuer in the MENA region
Leading issuer in the MENA region Liability mix Medium-term wholesale funding Customer Term Borrowings & Sub Issuances1 Maturities1 (USD Mn) Deposits, Debt, 6% 73% Others, 9% 5,073 USD USD 292.2Bn 4,704 Mar’23 Due to Banks & 4,398 3,948 CNH Repos, 9% 3,613 2,899 3,011 GBP Commercial Paper, 3% 2,663
Slide 33: Diversified Term Funding portfolio
Diversified Term Funding portfolio Term Funding Portfolio by Type1 Term Funding Portfolio by Currency1 Asian Currency Other ex-Formosa PP 6% 10% 17% Formosa Bullet EUR Callable 12% 9% USD Bullet Private CHF 33% Placement Conventional Public 8% 11% 11% GBP USD USD Public European 5% 63% 24% Currency
Slide 34: Leader in MENA Green Bond Issuance
Leader in MENA Green Bond Issuance Highlights: FAB Green Bonds Outstanding (as of 31 Mar’23) • In 2022, FAB’s Sustainable Finance Framework was updated to further align with market best practices and to expand the scope of financial products. CHF Public HKD PP 4% 32% USD Private • The framework was
Slide 35: Wrap-up and financial guidance
Wrap-up and financial guidance ▪ Q1’23 performance represents strong start to the year 2023e financial guidance Q1’23 actual ▪ The Group operates on solid balance sheet Loan growth Mid single-digit +3% ytd fundamentals ▪ We delivered good progress against our growth Cost of Risk < 80bps 62bps (CoR)
Slide 36: Supplementary financial slides
Supplementary financial slides 36
Slide 37: A strong financial track record
A strong financial track record Balance Sheet & Income Statement TOTAL ASSETS (USD Bn) LOANS & ADVANCES (USD Bn) CUSTOMER DEPOSITS (USD Bn) CAGR CAGR CAGR Mar'23 322.7 Mar'23 128.8 Mar'23 212.5 Dec'22 302.2 Dec'22 125.1 Dec'22 190.7 Dec'21 272.6 Dec'21 111.5 Dec'21 167.3 Dec'20 250.2 12% Dec'20 105.
Slide 38: A strong financial track record (continued)
A strong financial track record (continued) Key ratios COST-TO-INCOME RATIO - YTD (%) NIM - YTD (%) NPL RATIO1 (%) PROVISION COVERAGE1 (%) (EX-INTEGRATION COSTS, EX-MAGNATI GAINS) 2.5 2.4 4.0 4.0 3.9 3.8 120 31.6 2.1 110 101 101 27.7 25.8 26.7 27.0 26.4 1.8 3.1 3.2 3.2 93 95 98 25.1 1.5 1.6 1.7 FY'1
Slide 39: Business segments overview – IB & CCB
Business segments overview – IB & CCB Investment Banking (IB) Key highlights USD Mn Q1’23 QoQ% YoY% • Outstanding performance across all product lines, with Quarterly operating income trend (USD Bn) Loans & Deposits (USD Bn) Operating Income 723 (6) 49 revenue +49% yoy to USD 0.7Bn driven by 33% gro
Slide 40: Business segments overview – CB & GPB
Business segments overview – CB & GPB Consumer Banking (CB) Key highlights USD Mn Q1’23 QoQ% YoY% • Customer deposits grew 10% ytd and 21% yoy, led by Quarterly operating income trend (USD Bn) Loans & Deposits (USD Bn) USD 1Bn growth in CASA deposits, buoyed by recent Operating Income 219 (4) (10) L
Slide 41: International – financial overview
International – financial overview International (USD Mn) Q1’23 QoQ% YoY% Key highlights Quarterly operating income trend (USD Bn) Operating Income 421 (10) 55 • FAB’s international franchise is a competitive QoQ ↓10%, YoY ↑55% differentiator and a key contributor to Group liquidity Costs (110) (17)
Slide 42: Q1'23 financial highlights – Group financials
Q1’23 financial highlights – Group financials Income Statement - Summary (USD Mn) Q1’23 Q4’22 QoQ % Q1’22 YoY % Net interest Income 1,205 1,146 5 853 41 Non- interest Income 627 464 35 360 74 Operating Income 1,832 1,609 14 1,214 51 Gain on sale of stake in subsidiary - - na 764 na Total Income 1,83
Slide 43: Q1'23 financial highlights – Segmental
Q1’23 financial highlights – Segmental Q1’23 USD Mn Q1’23 Q4'22 QoQ % Q1’22 YoY % Contr% Operating income 1,833 1,610 14 1,214 51 100% Investment banking (IB) 723 768 (6) 486 49 39% Corporate & Commercial banking (CCB) 458 413 11 275 66 25% Consumer banking (CB) 219 227 (4) 244 (10) 12% Global Priv
Slide 44: Supplementary ESG slides
Jol nibgid iy ‘ 1 Fst abu Dab ark Supplementary ESG slides
Slide 45: FAB is committed to supporting the UAE's sustainability agenda
As the UAE’s largest bank, FAB is committed to supporting the country’s sustainability agenda to drive growth and development Sustainability is at the heart of the UAE’s economic strategy UAE National Net Zero by 2050 Pathway UAE Energy Strategy 2050 Throughout 3 GHG emissions reduction stages: • 18
Slide 46: New carbon emissions reduction targets set across three highest emitting sectors
New carbon emissions reduction targets set across three highest emitting sectors Reduction targets in line with the International Energy Agency’s (IEA) Net Zero Emissions (NZE) reference scenario Oil & Gas Power Generation Aviation -7 / -15% -64% -15% reduction in intensity by 2030 (MtCO2e/EJ) reduc
Slide 47: Operating Environment
doll abo Bo Fist Abu Dhabi Bank Operating Environment
Slide 48: UAE economy continues to remain robust despite global headwinds
UAE economy continues to remain robust despite global headwinds Driven by focus on economic growth and diversification UAE to continue to outperform global economy in FY’23… 1 … against a backdrop of relatively high oil prices2 UAE PMI continues to be strong3 UAE vs Global Real GDP growth (%) Oil Pr
Slide 49: Systemic liquidity remains strong while credit growth recovery reflects positive trends
Systemic liquidity remains strong while credit growth recovery reflects positive economic trends Sector fundamentals remain on solid footing Liquidity remains ample while credit growth continues to rebound… … with FAB outperforming and gaining market share Credit growth, net (YoY) Deposits growth (Y
Slide 50: Market heavyweight delivering sustainable shareholder returns
Market heavyweight delivering sustainable shareholder returns Overview1 Heavyweight constituents across indices • Listed on Abu Dhabi Securities Exchange (ADX) Amongst the largest Amongst the largest MENA & UAE constituents on most widely tracked • Symbol: FAB, ISIN: AEN000101016 constituent on the
Slide 51: Over 5 decades of shaping the UAE and the regional banking industry
Over 5 decades of shaping the UAE and the regional banking industry NBAD FGB FAB 2021 13th Feb 2000 1st Apr 2023 & 1968 NBAD is listed on Abu Dhabi Stock 2017 Bank Audi sal and FAB sign definitive agreement for BEYOND Exchange the sale and purchase of 100% of Bank Audi sae 2007 (Egypt)’s share capit
Slide 52: Prestigious awards highlight FAB's strength and industry expertise
Prestigious awards highlight FAB’s strength and industry expertise • Best Investment Bank in the United Arab Emirates • Best Bank in UAE • Best Bank for Transformation in Middle East • Best Equity Bank in the Middle East 2018-2021 Euromoney • Middle East’s Best Bank for Financing 2019-2021 • Best In
Slide 53: For more information, please visit www.bankfab.com
For more information, please visit www.bankfab.com or contact FAB Group Funding team at debtIR@bankfab.com You can also download FAB’s Investor Relations App from App Store /Google Play to access latest corporate updates Scan to download this presentation Click on the image to access latest reports
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