Oversea-chinese Banking Corporation Limited · SGX:O39
Oversea-chinese Banking — H1 2022 Earnings Presentation
36 slides from Oversea-chinese Banking's earnings presentation, Aug 3, 2022
Slide 1: First Half 2022 Results Presentation
First Half 2022 Results Presentation 3 August 2022 OCBC Financial Results Disclaimer: This presentation should be read as an overview of OCBC’s current business activities and operating environment which may contain statements relating to OCBC’s growth strategy and future business aspirations. These
Slide 2: Agenda
Agenda Financial Highlights Group Net Profit Group Performance Trends Appendices: Major Subsidiaries’ Results Note: - Certain comparative figures have been restated to conform with the current period’s presentation. - Amounts less than S$0.5m are shown as “0”; - “nm” denotes not meaningful; - “na” d
Slide 3: Financial Highlights
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Slide 4: 1H22 Performance
Performance review 1H22 Performance ■ Group 1H net profit at new Total Income +1% high YoY Group Net Profit S$5.52b ■ Net interest income at new high from asset growth and Net Interest +10% Non-Interest -10% S$2.84b +7% Income YoY Income YoY rise in NIM YoY ■ Non-interest income lower on Operating E
Slide 5: Financial Highlights
Performance review Financial Highlights Banking Wealth Management ■ Resilient performance across Net Profit (S$m) NII and Fee Income (S$m) WM Income (S$m) 1/ WM AUM (S$b) the Group’s diversified +15% +4% 40% 35% franchise 2,419 -1% 2,095 2Q22 YoY: 3,946 4,105 2Q22 -11% -0.5% ■ 2Q22 banking operation
Slide 6: Diversified Franchise Across Business and Geography
Performance review Diversified Franchise Across Business and Geography Operating Profit by Business Operating Profit by Geography Others Others Global Wholesale 1% 6% Insurance Banking Singapore Greater China 6% 19% 4% 44% 35% 24% 1H22 1H22 22% 1H21 24% 1H21 49% 47% 7% 15% 15% 22% 7% 16% Indonesia G
Slide 7: Strong Balance Sheet Fundamentals
Balance sheet Strong Balance Sheet Fundamentals Loans-to-Deposits Ratio Funding ■ Sound funding, liquidity and capital positions provide Group LDR (%) Composition as at Jun 22 flexibility to pursue growth and navigate uncertainties 12% Customer deposits 4% 3% Bank deposits ■ Stable funding mix with
Slide 8: Group Net Profit
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Slide 9: 1H22 Group Net Profit
Net Profit 1H22 Group Net Profit YoY Movement 1H22 YoY +7% (S$m) Positive on net profit Negative on net profit ■ NII up, driven by 6% increase in average asset balances and 6bps rise in NIM to 1.63% ■ Non-II declined from a drop in fee, investment and trading income ■ Increase in expenses led by ris
Slide 10: 2Q22 Group Net Profit
Net Profit 2Q22 Group Net Profit YoY Movement YoY +28% Positive on net profit 2Q22 (S$m) Negative on net profit QoQ +9% YoY ■ NII rose on asset growth and higher NIM ■ Non-II higher from increase in 2Q21 Net Interest Non-interest Operating Associates Total Amortisation, 2Q22 Net Profit Income (NII)
Slide 11: Group Performance
Group performance Group Performance 1H22 1H21 YoY 2Q22 2Q21 YoY 1Q22 QoQ OCBC Group S$m S$m +/(-)% S$m S$m +/(-)% S$m +/(-)% Net interest income 3,203 2,902 10 1,700 1,461 16 1,503 13 Non-interest income 2,319 2,584 (10) 1,179 1,111 6 1,140 3 Total income 5,522 5,486 1 2,879 2,572 12 2,643 9 Operati
Slide 12: Banking Operations Performance
Banking Ops performance Banking Operations Performance 1H22 1H21 YoY 2Q22 2Q21 YoY 1Q22 QoQ Banking Operations S$m S$m +/(-)% S$m S$m +/(-)% S$m +/(-)% Net interest income 3,152 2,853 10 1,674 1,436 17 1,478 13 Non-interest income 1,620 1,706 (5) 794 775 2 826 (4) Total income 4,771 4,559 5 2,468 2,
Slide 13: Group Performance Trends
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Slide 14: Net Interest Income
Net interest income Net Interest Income 1Q22 1.71% 1.58% 1.63% 1.52% 1.52% 1.55% 1.57% 1H22 2Q22 Net Interest Margin YoY +16% 3,203 YoY +10% 2,902 QoQ +13% 1,700 1,503 ■ 2Q22 NII up YoY and QoQ 1,461 1,461 1,492 to new high, from asset Net Interest Income growth and NIM expansion (S$m) ■ 2Q22 NIM cl
Slide 15: Non-interest Income
Non-interest income Non-interest Income 1H22 2Q22 YoY +6% YoY -10% QoQ +3% 47.1% 43.2% 42.9% 43.1% 42.0% % of Group Income 41.5% 40.9% 2,584 ■ 2Q22 non-II higher YoY, as 2,319 increase in trading income and life insurance profit 1,179 724 1,140 offset lower fee income 1,111 1,099 753 Non-interest In
Slide 16: Net Fees & Commissions
Non-interest income Net Fees & Commissions 1H22 2Q22 YoY -15% YoY -13% QoQ -9% 1,148 137 ■ 2Q22 fee income declined 999 57 YoY and QoQ mainly on 136 lower WM, brokerage and 563 569 528 522 225 50 investment banking fees in 69 67 Net Fees & Commissions (S$m) 23 69 68 477 line with weaker investment 3
Slide 17: Trading Income
Non-interest income Trading Income 1H22 2Q22 YoY +26% YoY -7% QoQ +19% 528 492 ■ 2Q22 trading income up 117 YoY from higher customer 115 and non-customer flow Trading Income (S$m) treasury income Non-Customer Flow 267 Customer Flow 212 225 83 83 32 410 38 152 377 174 170 165 193 184 (13) (87) 2Q21 3
Slide 18: Operating Expenses
Operating Expenses Operating Expenses 1H22 2Q22 YoY +10% 50.5% YoY +7% 44.3% 46.4% 45.6% 44.5% QoQ +4% 43.5% 41.7% Cost-to-income 2,458 ■ 2Q22 expenses up YoY 2,287 405 mainly due to: 1,289 1,188 1,205 1,253 382 • Rise in staff costs from 1,138 annual salary increments 280 218 440 206 187 and increa
Slide 19: Allowances
Allowances Allowances 1H22 2Q22 YoY -69% YoY -70% Credit costs (bps) 1/ 30 41 QoQ +64% 21 26 6 8 7 Total 50 18 24 19 ■ 2Q22 credit costs lower Impaired 4 0 2 YoY at 8bps from improved credit conditions compared to a year ago 317 393 ■ 2Q22 allowances for non- Allowances (S$m) 110 impaired assets mai
Slide 20: Total Cumulative Allowances
Allowances Total Cumulative Allowances YoY -8% 104% Jun 22 97% 99% QoQ unchanged Total NPA coverage 90% 91% 4,236 4,127 ■ Total cumulative 3,904 3,905 3,909 allowances largely 444 444 444 444 444 unchanged QoQ in line with low net allowance charge Cumulative allowances (S$m) 2,012 1,998 Regulatory L
Slide 21: Asset Quality
Asset quality Asset Quality YoY -3% Jun 22 1.5% 1.5% QoQ -8% 1.5% 1.4% NPL ratio 1.3% ■ Overall asset quality 4,338 4,307 continued to be sound 4,243 4,082 123 118 3,969 95 91 378 403 372 120 ■ NPL ratio decreased to 517 243 299 1.3% Non-performing Assets (S$m) 586 604 332 631 Debt securities / Cont
Slide 22: Asset Quality
Asset quality Asset Quality S$m 2Q21 1Q22 2Q22 1H21 1H22 At start of period 4,027 4,338 4,307 4,005 4,338 ■ New NPA formation in 2Q22 lower YoY and QoQ New NPAs Corporate/ Commercial Banking and Others 459 161 102 601 206 ■ Higher recoveries/upgrades Consumer Banking/ Private Banking 203 135 80 434
Slide 23: Customer Loans
Loans Customer Loans YoY +8% +9% in constant ccy terms Jun 22 QoQ +1% 290 294 298 +1% in constant ccy terms 285 275 Loans by Geography (S$b) 49 53 56 57 48 Rest of the world 70 73 74 74 76 ■ YoY loan growth driven by Greater China 18 19 19 19 19 Singapore, Indonesia 28 28 28 27 26 Indonesia Greater
Slide 24: Customer Deposits
Deposits Customer Deposits YoY +10% 85.6% 84.5% 84.4% Jun 22 Group LDR 83.6% 83.3% QoQ +0.2% 78.3% 79.3% 79.3% 76.7% 76.6% SGD LDR ■ Customer deposits rose 68.0% 67.0% YoY and QoQ 66.5% 65.8% 66.9% USD LDR ■ Healthy liquidity position with comfortable LDR 342 348 349 headroom 333 317 34 33 36 29 36
Slide 25: Capital
Capital Capital YoY -1.2ppt Jun 22 QoQ -0.3ppt 16.1 15.5 15.5 15.2 14.9 ■ CET1 ratio of 14.9% CET1 CAR (%) ■ RWA higher YoY in line with loan growth Jun 21 Sep 21 Dec 21 Mar 22 Jun 22 CET1 Capital (S$b) RWA (S$b) 35.3 35.0 34.8 35.1 231 232 34.6 226 225 220 Jun 21 Sep 21 Dec 21 Mar 22 Jun 22 Jun 21
Slide 26: Dividend
Dividend Dividend 47% 49% 44% Dividend payout ratio 40% 39% ■ Interim dividend of 28 cents per share, 12% 53.0 53.0 higher than a year ago ■ Payout ratio of 44% 43.0 28.0 28.0 DPS (cents) 31.8 23.0 Final dividend 15.9 Interim dividend 25.0 25.0 28.0 20.0 15.9 2018 2019 20201/ 20211/ 2022 1/ In July
Slide 27: Appendices: Major Subsidiaries’ Results
Appendices: Major Subsidiaries’ Results 27
Slide 28: Great Eastern Holdings’ Financial Highlights
Great Eastern Great Eastern Holdings’ Financial Highlights YoY YoY QoQ S$m 1H22 1H21 2Q22 2Q21 1Q22 +/(-)% +/(-)% +/(-)% Profit from insurance business 660 652 1 372 220 69 288 29 - Operating profit 366 328 11 174 147 19 191 (9) - Non-operating profit 227 252 (10) 168 36 368 59 186 - Others 67 72 (8
Slide 29: Great Eastern Holdings’ Performance Trends
Great Eastern Great Eastern Holdings’ Performance Trends Profit from Insurance Business (S$m) Profit from Shareholders’ Fund (S$m) 87% 2% 184% 162% 37% 120% 580 593 Non-operating profit/(loss) 343 125 250 252 227 Operating profit 183 168 63 59 36 (24) (53) (77) 191 328 366 147 174 2Q21 1Q22 2Q22 1H2
Slide 30: OCBC Wing Hang Hong Kong & Macau’s Financial Highlights
OCBC Wing Hang OCBC Wing Hang Hong Kong & Macau’s Financial Highlights YoY YoY QoQ HKD m 1H22 1H21 2Q22 2Q21 1Q22 +/(-)% +/(-)% +/(-)% Net interest income 1,709 1,787 (4) 868 882 (2) 841 3 Non-interest income 732 534 37 323 240 35 410 (21) Total income 2,441 2,321 5 1,191 1,122 6 1,251 (5) Operating
Slide 31: OCBC Wing Hang Hong Kong & Macau Performance Trends
OCBC Wing Hang OCBC Wing Hang Hong Kong & Macau Performance Trends Net Interest Margin Cost-to-Income 6.6ppt 4.4ppt 9bps 14bps 7.2ppt 1bp 1.57% 1.47% 1.48% 1.61% 1.47% 56.8% 50.2% 49.6% 53.1% 48.7% 2Q21 1Q22 2Q22 1H21 1H22 2Q21 1Q22 2Q22 1H21 1H22 Customer Loans (HKD b) Customer Deposits (HKD b) 7%
Slide 32: OCBC Malaysia’s Financial Highlights
OCBC Malaysia OCBC Malaysia’s Financial Highlights YoY YoY QoQ RM m 1H22 1H21 2Q22 2Q21 1Q22 +/(-)% +/(-)% +/(-)% Net interest income 799 790 1 408 409 − 391 4 Islamic banking income 1/ 228 239 (5) 117 118 (1) 111 5 Non-interest / finance income 300 383 (22) 146 208 (30) 154 (5) Total income 1,327 1
Slide 33: OCBC Malaysia Performance Trends
OCBC Malaysia OCBC Malaysia Performance Trends Net Interest Margin Cost-to-Income 1bp 4.2ppt 1bp 4.0ppt 7bps 3.0ppt 2.17% 2.11% 2.18% 2.13% 2.14% 47.5% 46.0% 43.3% 44.5% 42.0% 2Q21 1Q22 2Q22 1H21 1H22 2Q21 1Q22 2Q22 1H21 1H22 Customer Loans (RM b) Customer Deposits (RM b) 3.9% 4.2% 1% 3.4% NPL ratio
Slide 34: Bank OCBC NISP’s Financial Highlights
Bank OCBC NISP Bank OCBC NISP’s Financial Highlights YoY YoY QoQ IDR b 1H22 1H21 2Q22 2Q21 1Q22 +/(-)% +/(-)% +/(-)% Net interest income 4,034 3,870 4 2,076 1,960 6 1,957 6 Non-interest income 1,005 1,041 (3) 440 556 (21) 566 (22) Total income 5,039 4,911 3 2,516 2,516 − 2,523 − Operating expenses (
Slide 35: Bank OCBC NISP Performance Trends
Bank OCBC NISP Bank OCBC NISP Performance Trends Net Interest Margin Cost-to-Income 23bps 1.4ppt 18bps 1.2ppt 25bps 1.2ppt 4.10% 46.0% 44.8% 44.2% 45.4% 3.87% 3.92% 43.4% 3.62% 3.74% 2Q21 1Q22 2Q22 1H21 1H22 2Q21 1Q22 2Q22 1H21 1H22 Customer Loans (IDR t) Customer Deposits (IDR t) 2.5% 2.4% 14% 2.3%
Slide 36: Thank You
First Half 2022 Results Presentation Thank You
Oversea-Chinese Banking — H1 2022 Earnings Presentation on 6ix