United Overseas Bank Limited · SGX:U11
United Overseas Bank — Q2 2007 Earnings Presentation
22 slides from United Overseas Bank's earnings presentation, Aug 7, 2007
Slide 1: UOB Group First Half / Second Quarter 2007 Results Briefing
UOB Group First Half / Second Quarter 2007 Results Briefing FINANCIAL HIGHLIGHTS Lee Wai Fai Chief Financial Officer 7 August 2007 Disclaimer : This material that follows is a presentation of general background information about the Bank’s activities current at the date of the presentation. It is in
Slide 2: Agenda
Agenda 11 Review Review of of Financial Financial Performance Performance 22 Business Business & & Geographical Geographical Segments Segments 33 Loans, Loans, Deposits Deposits & & Asset Asset Quality Quality 44 Review Review of of Key Key Territories Territories 55 Capital Capital Management Manag
Slide 3: Profit Growth 25.0% Achieved in 1st Half 2007
Profit Growth 25.0% Achieved in 1st Half 2007 1H07 1H06 + / (-) $m $m % Net interest income 1,523 1,324 15.0 Non-interest income 968 660 46.6 Total income 2,490 1,984 25.5 Less: Total expenses 976 815 19.7 Operating profit 1,515 1,169 29.5 Less: Intangible assets amortised 6 6 (1.1) Impairment charg
Slide 4: Higher Profit in 2nd Quarter 2007
Higher Profit in 2nd Quarter 2007 2Q07 1Q07 + / (-) 2Q06 + / (-) $m $m % $m % Net interest income 761 762 (0.1) 671 13.4 Non-interest income 536 432 24.1 310 72.7 Total income 1,297 1,194 8.7 981 32.2 Less: Total expenses 504 472 6.8 419 20.3 Operating profit 793 722 9.9 562 41.0 Less: Intangible as
Slide 5: Higher Net Interest Income Year-on-Year
Higher Net Interest Income Year-on-Year Net Interest Income and Margin 3.25% 3.31% 3.29% 3.26% 3.25% ^ 3.28% 3.01% 3.18% 3.22% 1.99% 1.99% 2.10% 1.97% 1.97% 1.99% 2.10%^ 2.04% 2.10% 0.58% 0.66% 0.67% 0.78% 0.72% 0.68% 0.60% 0.55% 0.62% 2nd Half 1,386 761 1,191 762 1,099 671 684 702 114 106 102 89 11
Slide 6: Higher Fee and Commission Income
Higher Fee and Commission Income Non-Interest Income (Non-NII) and Non-NII Ratio 33.9% 37.6% 35.8% 38.9% 42.4% 41.3% 23.9% 23.7% 23.7% 36.2% 21.7% 33.0% 31.6% 968 27.2% 23.2% 25.4% 854 21.6% 21.7% 764 660 379 517 536 650 536 568 236 301 432 185 206 210 337 184 279 310 173 214 589 82 116 528 552 450
Slide 7: Continue Infrastructure Investments
Continue Infrastructure Investments Operating Expenses and Expense / Income Ratio 41.1% 42.7% 37.9% 39.2% 41.6% 37.6% 40.8% 39.5% 38.9% 2nd 504 Half 497 472 921 70 68 419 424 67 757 59 59 678 1st 976 Half 667 815 548 2004 2005 2006 1H07 2Q06 3Q06 4Q06 1Q07 2Q07 Operating OperatingExpenses Expenses($
Slide 8: Individual Impairment Charges on Loans
Individual Impairment Charges on Loans Individual Impairment on Loans Charged to Profit & Loss Account 43 bp 36 bp 31 bp 19 bp 29 bp 21 bp 2nd 16 bp 122 85 15 bp Half 8 bp 56 1st 130 86 Half 113 119 86 27 41 33 16 2004 2005 2006 1H07 2Q06 3Q06 4Q06 1Q07 2Q07 Individual IndividualImpairment Impairmen
Slide 9: Operating Profit Contribution by Business Segment
Operating Profit Contribution by Business Segment Business Segment 1H07 2006 1H07 2006 1H07 1H06 + / (-) Personal : 30% Segment Operating Profit $m $m % Other : 5% Personal Financial Services 456 343 32.9 Global Markets & Invt Mgt : 17% Institutional Financial Services 727 556 30.8 Institutional : 4
Slide 10: Higher Operating Profit Contribution from Overseas Operations
Higher Operating Profit Contribution from Overseas Operations Geographical Segment 1H07 1H07 1H07 1H06 + / (-) Singapore : 65% Operating Profit * $m $m % Singapore (including ACU) ** 990 771 28.4 Other ASEAN : 22% Other ASEAN countries 339 280 21.1 Other Asia-Pacific : 5% Rest of the world : 8% Othe
Slide 11: Increase in Loans and Deposits
Increase in Loans and Deposits Customer Loans, Deposits and L/D Ratio 82.8 % 80.5 % 78.2 % 79.3 % 78.9 % 99.7 104.5 89.8 95.6 89.0 79.0 82.5 70.2 73.7 76.9 Jun'06 Sep'06 Dec'06 Mar'07 Jun'07 Net NetCustomer CustomerLoans Loans($b) ($b) Customer CustomerDeposits Deposits($b) ($b) Loans Loans//Deposit
Slide 12: Continued Decrease in NPLs
Continued Decrease in NPLs Group: NPLs ($m) 3,836 3,532 3,165 2,986 2,382 NPL Ratio 5.3% 4.6% 4.0% 3.7% 2.8% 320 144 279 129 287 978 115 287 961 115 823 293 841 94 620 620 403 594 577 585 1,774 1,543 1,346 1,166 1,007 Jun'06 Sep'06 Dec'06 Mar'07 Jun'07 Singapore Malaysia Thailand Indonesia Other 12
Slide 13: Impairment Coverage Remained Adequate
Impairment Coverage Remained Adequate Total Impairment 2,652 2,562 2,508 2,523 2,112 ($m) 208.1% 188.6% 165.5% 172.9% 172.6% 84.5% 88.7% 79.2% 69.1% 72.5% 1,383 1,292 1,237 1,250 836 1,269 1,270 1,271 1,273 1,276 Jun'06 Sep'06 Dec'06 Mar'07 Jun'07 Collective CollectiveImpairment Impairment($m) ($m)
Slide 14: Malaysia – Summarised P/L
Malaysia – Summarised P/L 1H07 1H06 + / (-) 2Q07 1Q07 + / (-) RM’m RM’m % RM’m RM’m % Net interest income 435 332 31.0 202 233 (13.3) Non-interest income 212 174 21.8 124 88 40.9 Total income 647 506 27.9 326 321 1.6 Less: Total expenses 215 165 30.3 112 103 8.7 Operating profit 432 341 26.7 214 218
Slide 15: Malaysia – Key Financial Indicators
Malaysia – Key Financial Indicators 1H07 1H06 + / (-) 2Q07 1Q07 + / (-) % % % pt % % % pt Net interest margin 2.98 2.99 (0.01) 2.65 3.35 (0.70) Non-NII / Total income 32.8 34.4 (1.6) 38.0 27.4 10.6 Expense / Total income 33.2 32.6 0.6 34.4 32.1 2.3 Customer loans (net) – RM’m 22,460 18,777 19.6% 22,
Slide 16: Thailand – Summarised P/L
Thailand – Summarised P/L 1H07 1H06 + / (-) 2Q07 1Q07 + / (-) THB’m THB’m % THB’m THB’m % Net interest income 3,147 3,201 (1.7) 1,556 1,591 (2.2) Non-interest income 1,420 1,387 2.4 718 702 2.3 Total income 4,567 4,588 (0.5) 2,274 2,293 (0.8) Less: Total expenses 3,192 2,902 10.0 1,607 1,585 1.4 Ope
Slide 17: Thailand – Key Financial Indicators
Thailand – Key Financial Indicators 1H07 1H06 + / (-) 2Q07 1Q07 + / (-) % % % pt % % % pt Net interest margin 3.34 3.89 (0.55) 3.25 3.51 (0.26) Non-NII / Total income 31.1 30.2 0.9 31.6 30.6 1.0 Expense / Total income 69.9 63.3 6.6 70.7 69.1 1.6 Customer loans (net) – THB’m 137,552 147,738 (6.9)% 13
Slide 18: Indonesia – Summarised P/L
Indonesia – Summarised P/L 1H07 1H06 + / (-) 2Q07 1Q07 + / (-) IDR’b IDR’b % IDR’b IDR’b % Net interest income 702 616 14.0 343 359 (4.5) Non-interest income 145 167 (13.2) 82 63 30.2 Total income 847 783 8.2 425 422 0.7 Less: Total expenses 377 346 9.0 192 185 3.8 Operating profit 470 437 7.6 233 2
Slide 19: Indonesia – Key Financial Indicators
Indonesia – Key Financial Indicators 1H07 1H06 + / (-) 2Q07 1Q07 + / (-) % % % pt % % % pt Net interest margin 6.57 6.61 (0.04) 6.32 6.93 (0.61) Non-NII / Total income 17.1 21.3 (4.2) 19.3 14.9 4.4 Expense / Total income 44.5 44.2 0.3 45.2 43.8 1.4 Customer loans (net) – IDR’b 15,770 12,570 25.5% 15
Slide 20: Strong Capital Position
Strong Capital Position Capital Adequacy Ratios (CAR) 16.5% 16.3% Total CAR 16.1% 16.2% 15.7% Tier 1 CAR ` 11.2% 10.8% 11.0% 11.1% 10.8% Jun'06 Sep'06 Dec'06 Mar'07 Jun'07 $m Tier 1 Capital 11,379 11,354 11,888 12,451 12,382 Risk-Weighted Assets 101,712 105,250 108,405 111,781 114,842 20
Slide 21: Maintain High Dividend Rate
Maintain High Dividend Rate Special Dividend in Specie 30 cts 28.5 cts Final Interim 50 cts 40 cts 40 cts 15 cts 20 cts 20 cts 20 cts 20 cts 2004 2005 2006 1H07 Special Dividend - $351m * $369m $187m Cash Dividend $744m $737m $868m $250m Dividend Payout $744m $1,088m $1,237m $437m Dividend Payout Ra
Slide 22: In Summary …
In Summary … Net profit grew 25.0% to reach $1.1 billion in 1st Half 2007, 12.8% increase QoQ Strong broad based fee and other income growth Strong broad based loan growth across all segments and countries Continued discipline in expense control Continued improvement in asset quality Hig