Riyad Bank · TADAWUL:1010
Riyad Bank — FY2020 Earnings Presentation
36 slides from Riyad Bank's earnings presentation, 2021
Slide 1: Investor Presentation FY 2020
Investor Presentation FY 2020 General Business
Slide 2: Contents
Riyad Bank Investor Presentation – FY 2020 Contents 01 Who We Are 03 05 02 FY 2020 Financial Results 14 Strategy Overview 04 06 03 Business Segments 25 Macroeconomic Overview 05 07 04 2021 Outlook 30 Strategy Update 10 08 Appendix 32 Investor Presentation – FY 2020 General Business Page 2 2
Slide 3: Riyad Bank is the Third Largest Bank in Saudi Arabia
Riyad Bank at glance Riyad Bank is the Third Largest Bank in Saudi Arabia FY 2020 Key Metrics Third Largest Bank in Saudi Arabia* Riyad Bank Presence SAR London Singapore 310 bn in Assets 341 Branches 1 Branch 1 Rep Office SAR 191 bn in Loans, Net 2,486 ATMs SAR 203 bn in Deposits 88,542 PoS Ratings
Slide 4: Management Highlights FY 2020 Snapshot
Strategy Overview Management Highlights FY 2020 Snapshot Executed the strategic transformation plan exceptionally well. Strategy Structural and recent shifts in the industry require Riyad Bank to chart a new course therefore, Riyad Bank is activating a new phase of the transformation. Net loan
Slide 5: KSA Macroeconomic Environment
KSA Macroeconomic Environment 5 General Business
Slide 6: Saudi Macro Framework
KSA Macroeconomic environment Saudi Macro Framework The Economy started to recover form COVID-19 impact GDP CPI Inflation 6.0 8.0 4.0 6.0 2.0 4.0 0.0 2.0 -2.0 0.0 -4.0 -2.0 -6.0 -8.0 -4.0 Q3/15 Q3/16 Q3/17 Q3/18 Q3/19 Q3/20 2015 2016 2017 2018 2019 2020 Real GDP growth rate, quarterly, %yoy CPI infl
Slide 7: Banking Sector Highlights
KSA Macroeconomic environment Banking Sector Highlights The Economy started to recover form COVID-19 impact (Continued) Regulatory LDR Credit and Customer Deposits 86 20.0 84 15.0 82 10.0 80 5.0 78 76 0.0 74 -5.0 2015 2016 2017 2018 2019 2020 2015 2016 2017 2018 2019 2020 Claims to private sector, %
Slide 8: Government programs
KSA Macroeconomic environment Government programs SAR 290+bn in combating adverse impact of COVID-19 on Saudi Economy Saudi Human Ministry of Saudi Arabian Monetary Authority (SAMA) Ministry of Finance Resources Interior Development Fund To extend Iqama and To Private sector To Banks To Economy SAR
Slide 9: Vision 2030 initiatives
KSA Macroeconomic environment Vision 2030 initiatives Riyad Bank is fully committed to the success of the National Agenda 1. Project Support Fund # 1 # of MOUs 2. Facility Guarantee 3. Project Finance 4. Supportive Initiatives for Developing Business Enablers in Entertainment Sector 5. Real Estate F
Slide 10: Strategy Update
Strategy Update 10 General Business
Slide 11: Riyad Bank has executed its strategic transformation exceptionally well
Strategy Update Riyad Bank has executed its strategic transformation exceptionally well, making it the fastest growing bank in KSA for the past 3 years To be the most innovative and trusted CAGR %, 2017-2019 financial solutions partner Profit Loans and advances, net Spot balance RIYAD 26 12 Avg. Pee
Slide 12: Structural shifts require us to chart a new course for the Bank
Strategy Update However, structural and recent shifts in the industry require us to chart a new course for the Bank Recent trends Increasing customer Depressed demand and Imperative to renew Growing competitive expectations around digital compressed margins effort to reinforce our intensity with rec
Slide 13: Delivered across 3 areas to become the Best Bank in KSA
Strategy Update ... Which will be delivered across 3 areas and support our aspiration to become the Best Bank in KSA Strategy Value through innovation Creating new markets through Efficiency through digital eco-systems, disrupting digitization me-too propositions, Improve organization productivity i
Slide 14: Financial Results Overview
Financial Results Overview 14 General Business
Slide 15: FY 2020 Key Highlights
Financial results overview FY 2020 Key Highlights FY 2020 Vs FY 2019 16.7% 10.0% 5.8% 4.4% 18.5% Balance Sheet Total assets Loan and Investments, net Customer Demand & other advances, net deposits deposits 15.8% 4.8% 3.9% 4.6% Increase in Credit related impairment by 105% mainly due to updating ba
Slide 16: Financial Highlights – Balance Sheet
Financial results overview Financial Highlights – Balance Sheet Strong balance sheet growth supported by continued growth in loans and placements Total Assets Growth Drivers (SARbn) QoQ % YTD % SAR (mn) Q4 2020 Q3 2020 Q4 2019 change change +17% 24 310 Cash and balances with 266 3 17 SAMA and financ
Slide 17: Assets & Lending
Financial results overview Assets & Lending Strong loan growth mainly driven by commercial and mortgage loans Loans & Advances Growth Drivers (SARbn) Mortgages Loans, Gross (SARbn) +25% +10% 37 39 34 36 0 8 10 0 191 31 174 0 28 Q4-19 Overdrafts Credit Consumer Commercial Other Q4-20 Q3-19 Q4-19 Q1-2
Slide 18: Liabilities and Funding
Financial results overview Liabilities and Funding Continued strong growth in non-commission bearing deposits and progressively optimizing the bank’s cost of funds. Due to banks grew on the back of SAMA deposits. Customer Deposits Growth Drivers (SARbn) Total Liabilities Mix (SARbn) +4% 23 0 13 2 20
Slide 19: Financial Highlights – Income Statement
Financial results overview Financial Highlights – Income Statement Operating income growth was offset by higher impairment charges YoY % QoQ % Net Income before Zakat Growth Drivers by Segment (SARmn) SAR (mn) FY 2020 FY 2019 Q4 2020 Q3 2020 change change Net special commission income 8,214 7,837 +4
Slide 20: Income Trends
Financial results overview Income Trends Income growth supported by strong balance sheet Total Operating Income, Net (SARmn) Total Operating Income Growth Drivers by Segment (SARmn) +5% +3% 10,717 25 63 222 178 11,205 2,763 2,705 2,885 2,709 2,821 2,790 FY 19 Retail Corporate Treasury & Riyad Capita
Slide 21: Expenses Trends
Financial results overview Expenses Trends Continued cost efficiency improvement driven by income growth, despite continued investment in the Bank’s transformation program Operating Expenses (SARmn) Operating Expenses Growth Drivers by Type (SARmn) -13% -1% 1,107 925 958 3,674 60 49 3,635 903 861 89
Slide 22: Credit Quality
Financial results overview Credit Quality Stable asset quality trends with solid NPL coverage ratio Impairment Charge for Credit Losses, Net (SARmn) Cost of Risk (YTD %) +93% 1.07% 648 0.95% 0.96% 570 0.78% 466 0.67% 335 0.53% 303 190 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 9M-19 FY-19 Q1-20 H1-20 9M-20
Slide 23: Capitalization
Financial results overview Capitalization Capitalization well above regulatory minima and continues to support growth Capitalization (SARbn) Capital Ratios (%) +13% 49 51 45 41 43 44 0.20 18.8% 19.1% 17.9% 18.5% 18.1% 17.8% 5 6 7 Q4-19 Q3-20 Q4-20 16.1% 16.3% 16.5% Common equity tier 1 capital Tier
Slide 24: Liquidity
Financial results overview Liquidity Liquidity continues to be at comfortable levels HQLA and Liquidity Coverage (SARbn/%) Loans to Deposit Ratios (%) 62 94.8% 0.096 94.8% 52 51 93.8% 94.2% 50 93.6% 46 0.094 43 190% 200% 0.092 89.4% 165% 155% 168% 160% 92.2% 91.2% 91.7% 0.090 91.5% 90.2% 0.088 87.6%
Slide 25: Business Segments
Business Segments 25 General Business
Slide 26: Retail Banking
Business Segments Retail Banking Operating income growth offset by higher impairment charges YoY % QoQ % SAR (mn) FY 2020 FY 2019 change 4Q 2020 3Q 2020 change Total Assets (SARbn) Total Liabilities (SARbn) Total assets 77,495 69,754 +11% 77,495 75,644 +2% Total liabilities 92,921 83,485 +11% 92,921
Slide 27: Corporate Banking
Business Segments Corporate Banking Strong loans and deposits growth YoY % QoQ % SAR (mn) FY 2020 FY 2019 change 4Q 2020 3Q 2020 change Total Assets (SARbn) Total Liabilities (SARbn) Total assets 133,404 123,120 +8% 133,404 134,640 -1% Total liabilities 149,573 124,794 +20% 149,573 150,430 -1% +8% +
Slide 28: Treasury & Investments
Business Segments Treasury & Investments Increase in profit due to increase from fees and other income YoY % QoQ % SAR (mn) FY 2020 FY 2019 change 4Q 2020 3Q 2020 change Total Assets (SARbn) Total Liabilities (SARbn) Total assets 96,820 71,341 +36% 96,820 96,171 +1% Total liabilities 22,784 16,511 +
Slide 29: Riyad Capital
Business Segments Riyad Capital Strong performance supported by strong AuMs growth Total AUM (SARbn) SAR (mn) Total assets 2,370 1,574 +51% 2,370 2,103 +13% Total liabilities 455 428 +6% 455 422 +8% +34% 67 Net special commission 191 142 +35% 49 46 +5% income 50 Fee and Commission income 544 412 +32
Slide 30: 2021 Outlook
2021 Outlook 30 General Business
Slide 31: 2021 Guidance
2021 Outlook 2021 Guidance Riyad Bank Guidance Guidance Metric FY 2019 2020 latest Guidance FY 2020 2021 Guidance SAR174 Bn Low-mid double digit % SAR191 Bn High single digit % Loans, Net (+15% YoY) growth (+10% YoY) growth NSCI Margin (%) 3.48% - 25bps to -40bps 3.13% -10bps to -20bps Cost to Incom
Slide 32: Appendix
Appendix 32 General Business
Slide 33: ESG Focus
ESG Focus Riyad banks’ commitment to Environmental, Social and Governance (ESG) factors, started well before global trends With Bukra, the Bank is targeting the following UNSDGs: “Bukra”, a comprehensive and long-term corporate social responsibility strategy, is aligned with the best practices of th
Slide 34: Riyad Bank COVID-19 Initiatives
COVID-19 Update Riyad Bank COVID-19 Initiatives Supporting the economy and community while ensuring business continuity and safety of employees Medical efforts Economic efforts Employees • Distributed 7,000 safety boxes • Through SAMA credit relief initiatives channeled • Hot lines and App for conta
Slide 35: Riyad Bank Contact
Appendix Riyad Bank Contact Contact the investor relations for more information: Ibrahim Al-Muhanna Visit our Website Head of Investor Relations https://www.riyadbank.com/en/about-us/investor-relations Telephone: +966 11 401 3030 Ext. 2499 E-mail: ibrahim.al-muhanna@riyadbank.com Address: Riyadh - A
Slide 36: Disclaimer
Appendix Disclaimer This presentation has been prepared by Riyad Bank solely for informational purposes. The presentation may contain forward looking statements, which reflect Riyad Bank's beliefs or current expectations and assumptions regarding the future of the business, future plans and strategi