National Bank Of Kuwait K.s.c. · KSE:NBK
National Bank Of Kuwait K.s.c — National Bank of Kuwait — H1 2020 Earnings Presentation
27 slides from National Bank Of Kuwait K.s.c's earnings presentation, 2020
Slide 1: National Bank of Kuwait Investor Presentation
National Bank of Kuwait Investor Presentation 1Q / 1H 2020 Earnings Call
Slide 2: Disclaimer
Disclaimer THE INFORMATION SET OUT IN THIS PRESENTATION AND PROVIDED IN THE DISCUSSION SUBSEQUENT THERETO DOES NOT CONSTITUTE AN OFFER OR SOLICITATION OF AN OFFER TO BUY OR SELL SECURITIES. IT IS SOLELY FOR USE AT AN INVESTOR PRESENTATION AND IS PROVIDED AS INFORMATION ONLY. THIS PRESENTATION DOES N
Slide 3: Contents
Contents Section 1 Group CEO Opening Remarks Section 2 Financial Performance 1Q / 1H 2020 Section 3 Appendix Section 4 Questions 2
Slide 4: NBK Profitability (KWD mn)
NBK Profitability (KWD mn) -46.9% 209 -27.9% -67.0% 108 111 101 78 33 1Q 2019 1Q 2020 2Q 2019 2Q 2020 1H 2019 1H 2020 3
Slide 5: Key Economic Highlights
Key Economic Highlights Brent Price ($/bp) Real GDP (% y/y) 80 Total Non-oil 70 6 4.2 4.8 6 60 4 2.6 2.3 3.0 4 1.6 50 1.0 2 0.4 2 0.5 2.9 2.3 40 0 1.1 1.2 0 0.4 -4.7 -2 0.6 -2 30 -4 -4.0 -4 -6.0 20 -6 -6 2013 2014 2015 2016 2017 2018 2019f 2020f 2021f Development of the Discount rate (%, end year2)
Slide 6: COVID19 outbreak timeline
COVID19 outbreak timeline •First confirmed COVID 19 Case February •Suspension of schools & universities •Closing of most businesses starting March 9th March •Public holiday starting March 12th •Suspension of Commercial flights and public transport as of March 11th •Curfew and Lockdown April •Extensi
Slide 7: Strong capacity to absorb COVID19 impact
Strong capacity to absorb COVID19 impact NBK Credit Ratings Financial snapshot KWD million 2017 2018 2019 Rating LT Standalone Outlook Agency Rating Rating Net Operating Income 823 883 896 Net Profit attributable 322 371 401 Aa3 a3 RUR NPL Ratio (%) 1.42% 1.38% 1.10% Loan Loss Coverage Ratio (%) 287
Slide 8: NBK’s strategy
NBK’s strategy The Bank aims to (i) remain the primary banker for the leading local companies whilst continuing to be active in the mid-market sector;(ii) remain the bank of choice for foreign companies and continuing to serve at least 75% of those companies and (iii) Corporate Banking maintain
Slide 9: Key strengths
Key strengths High credit ratings and among the Largest banking group in Kuwait with top brand values regionally dominant market position NBK has one of the highest credit ratings in the MENA As at 31 December 2019, the Bank was the largest region bank in Kuwait in terms of total assets, loans a
Slide 10: Contents
Contents Section 1 Group CEO Opening Remarks Section 2 Financial Performance 1Q / 1H 2020 Section 3 Appendix Section 4 Questions 9
Slide 11: Operating Performance 1H 2020
Operating Performance 1H 2020 Net Profit (KDm) Operating Surplus (KDm) 306.0 209.1 260.3 -46.9% -15.0% 107.7 111.1 154.4 151.7 142.4 101.4 77.7 117.9 33.4 1Q 2019 2Q 2019 1Q 2020 2Q 2020 1H 2019 1H 2020 1Q 2019 2Q 2019 1Q 2020 2Q 2020 1H 2019 1H 2020 Operating Income (KDm) Operating Income Non-inter
Slide 12: Operating Performance 1H 2020
Operating Performance 1H 2020 Net Interest Income (KDm) Average Interest Earning Assets (KDbn) 28.5 344.4 318.5 27.4 -7.5% +4.0% 26.3 171.2 173.2 169.2 +8.3% 149.3 1Q 2019 2Q 2019 1Q 2020 2Q 2020 1H 2019 1H 2020 1H 2019 2H 2019 1H 2020 Net Interest Margin* Net Interest Margin drivers YTD NIM Qtrly N
Slide 13: Operating Performance 1H 2020
Operating Performance 1H 2020 Non-interest income (KDm) Operating Expenses (KDm) Net fees and commissions Staff expenses 107.5 154.3 Net gains from dealing in FX 145.8 96.0 Other operating expenses 10 Other non-interest income +5.8% 19 60 69 26 -10.7% 82.4 55.6 74.6 71.9 54.3 71.2 53.1 7 3 40.4 9 20
Slide 14: Operating Performance 1H 2020
Operating Performance 1H 2020 Operating Income (KDm) - International Operating Income (KDm) 109.1 108.7 Int'l Int'l 24% 26% -0.4% Dom. Dom. 76% 74% 1H 2019 1H 2020 1H 2019 1H 2020 Net profit (KDm) - International Net Profit (KDm) Int'l 53.7 Int'l 9% 26% Dom. -81.2% 74% Dom. 91% 10.1 1H 2019 1H 2020
Slide 15: Operating Performance 1H 2020
Operating Performance 1H 2020 Total Assets (KDbn) Loans, Advances and Islamic Financing (KDbn) 30.5 29.7 29.3 27.4 27.9 17.7 17.6 16.0 16.2 16.6 +1.4% +6.2% +6.5% +8.4% Mar 19 Jun 19 Dec 19 Mar 20 Jun 20 Mar 19 Jun 19 Dec 19 Mar 20 Jun 20 Customer Deposits (KDbn) Funding Mix CD's / GMTN / T2 Bonds /
Slide 16: Performance and Asset Quality ratios 1H 2020
Performance and Asset Quality ratios 1H 2020 Return on Average Equity Return on Average Assets 1.53% 1.42% 13.2% 12.3% 0.75% 6.3% 1H 2019 FY 2019 1H 2020 1H 2019 FY 2019 1H 2020 Capital Adequacy Ratios Asset Quality Ratios CET 1 Ratio Tier 1 Ratio Capital Adequacy Ratio Loan Loss Coverage Ratio NPL
Slide 17: 2020 Guidance
2020 Guidance 1H 2020 2020 Guidance Loan Growth +6.2% ytd Mid To High Single Digit NIM 2.25% Tighter Cost to Income ratio 37.2% Broadly Stable Cost of Risk 112bps Earnings -46.9% yoy Capital Adequacy 16.8% 16
Slide 18: Contents
Contents Section 1 Group CEO Opening Remarks Section 2 Financial Performance 1Q / 1H 2020 Section 3 Appendix Section 4 Questions 17
Slide 19: Consolidated Financials 1H 2020 (KWD million)
Consolidated Financials 1H 2020 (KWD million) YoY Growth YoY Growth Income Statement (KWD million) 1H-19 1H-20 Balance sheet (KWD million) June-19 June-20 (%) (%) Interest Income 492 419 (15%) Cash and short term funds 3,047 3,771 24% Interest Expense 208 168 (19%) Central Bank of Kuwait bonds 818 8
Slide 20: Performance Measures 1H 2020
Performance Measures 1H 2020 % 1H 2019 1H 2020 Return on average assets 1.53% 0.75% Return on average equity 13.2% 6.3% Net interest margin 2.64% 2.25% Cost to income 32.3% 37.2% NPLs to gross loans 1.39% 1.77% Loan loss reserves to NPLs 234.3% 185.5% Tier 1 capital 14.6% 14.9% Tier 2 capital 2.0% 1
Slide 21: Consolidated Statement Of Income (KWD million)
Consolidated Statement Of Income (KWD million) KWD million 2017 2018 2019 Interest Income 743 897 987 Interest Expense 224 331 422 Net Interest Income 519 566 565 Murabaha and other Islamic financing income 156 186 211 Finance cost and Distribution to depositors 46 62 87 Net Income from Islamic fina
Slide 22: Consolidated Statement Of Financial Position (KWD million)
Consolidated Statement Of Financial Position (KWD million) KWD million 2017 2018 2019 Cash and short term funds 2,744 2,967 3,787 Central Bank of Kuwait bonds 656 810 823 Kuwait Government treasury bonds 1,076 872 662 Deposits with banks 2,488 2,364 1,909 Loans, advances and Islamic financing to cus
Slide 23: Stable Credit Ratings
Stable Credit Ratings Long-term Standalone Rating Agency Outlook Key Rating Drivers Rating Rating • Dominant domestic position Rating Under • Resilient profitability and growth prospects Aa3 a3 Review • Robust asset quality, adequate capitalization and ample liquidity • Leading position in Kuwait A
Slide 24: Contents
Contents Section 1 Group CEO Opening Remarks Section 2 Financial Performance 1Q / 1H 2020 Section 3 Appendix Section 4 Questions 23
Slide 25: Questions
Questions yiibagJl NBK ee
Slide 26: Thank You
Thank You yiibagJl NEE
Slide 27: National Bank of Kuwait Investor Presentation
National Bank of Kuwait Investor Presentation 1Q / 1H 2020 Earnings Call
National Bank of Kuwait — H1 2020 Earnings Presentation on 6ix