Kina Securities Ltd. · ASX:KSL
Kina Securities — FY2024 Earnings Presentation
29 slides from Kina Securities's earnings presentation, Feb 28, 2025
Slide 1: Full Year Results 2024
F U L L Y E A R R E S U LT S 2 0 2 4 28 February 2025 1
Slide 2: Contents
Contents. Overview – FY 24 result – Strategy and outlook – Ivan Vidovich Ivan Vidovich & Ivan Vidovich Johnson Kalo 2
Slide 3: Overview
Overview. W Kina SecuritiesLimited
Slide 4: Delivering our strategy
Delivering our strategy. • Loan book growth: 13% increase due to strong drawdown performance and active pipeline management in business lending. Growth & • Foreign exchange revenues: 68% rise from increased customer inflows, major account onboarding, and BPNG's interventions. Prosperity • Digital ch
Slide 5: Profitable, sustainable growth
Profitable, sustainable growth. Organic growth momentum • NPBT up 5% • Underlying NPAT up 7% • Lending up 13% • Net Interest Income up 9% Non Interest Income • FX Income up 68% • Digital Channels up 27% • Wealth Management Income up 28% Shareholder returns • Full year dividend per share of 10.0 cent
Slide 6: Shareholder return
Shareholder return. Return on Equity Dividend per share Statutory Earnings per Share 19.6% 40.6 26.4 26.1 25.6 36.6 16.8% 35.7 17.9% 15.7% 17.1% 16.8% 10.6 16.4 10.0 10.0 13.8 13.8 FY2022 FY2023 FY2024 FY2022 FY2023 FY2024 FY2022 FY2023 FY2024 ROE - Statutory ROE - Underlying DPS (PGK toea) DPS (AUD
Slide 7: Financial Results
Financial Results. () Kina SecuritiesLimited
Slide 8: Financial Highlights
Financial Highlights. FY2024 FY2023 Movement % Net Interest Income (PGK m) 222.2 203.3 9% Revenue (PGK m) 488.8 404.2 21% Net Profit before Tax (PGK m) 184.1 175.5 5% Underlying NPAT (PGK m) 111.9 105.0 7% Statutory NPAT (PGK m) 102.5 105.0 (2%) Cost to income ratio (%) 58.6 54.2 8% Underlying ROE (
Slide 9: Statutory vs operating earnings
Statutory vs operating earnings. Statutory NPAT 1H (PGK’000) 2H (PGK’000) FY (PGK’000) FY2024 42,241 60,227 102,468 FY2023 46,367 58,598 104,965 % change (8.9%) 2.8% (2.4%) Operating NPAT 1H (PGK’000) 2H (PGK’000) FY (PGK’000) FY2024 42,241 60,227 102,468 Add back: Deferred tax adjustment - 9,403 9,
Slide 10: Revenue
Revenue. • FY24 revenue propelled by interest income on loans, foreign currency and digital channels. FY2024 FY2023 Others Investments 10% 9% Wealth Others Investments 9% 11% 13% Wealth 8% Digital Digital 15% 14% Loans 41% Loans FX 43% 11% FX 16% 10
Slide 11: Loan growth of 13%
Loan growth of 13%. 1,942 1,651 • Solid loan growth of 13% vs PCP. 1,344 • Driven by Business and Home loans. PGK’m 576 608 534 94 110 113 72 93 98 76 84 86 82 101 105 Business Loan Home Loan Investment Property Asset Financing Personal Loan Overdraft and Other FY2022 FY2023 FY2024 11
Slide 12: Net Interest Margin
Net Interest Margin. 7.2% NIM impacted by: 7.0% 7.1% 7.1% 6.5% 6.5% • Gradual lift in the 2H on treasury bill 6.2% 6.0% 5.8% yield rates. 5.5% 5.6% 5.6% • Solid growth in commercial and home 5.5% lending 5.3% • Stable growth in corporate wholesale deposits 3.4% 3.4% 3.4% 2.8% 92.5 88.7 98.1 105.2 11
Slide 13: Digital Revenue 27% growth
Digital Revenue 27% growth. 37 36 31 • Improvements in distribution operating 26 27 model, consistent growth in merchant and bill payments, visa volumes and e-commerce partnerships. PGK'm 14 5 4 3 2 2 1 Merchant fees VISA Fees Mobile Banking fees Internet Banking fees 13 FY2022 FY2023 FY2024
Slide 14: Kina Wealth
Kina Wealth. Funds under management (FuM) Funds under administration (FuA) 980 958 11.57 960 10.00 940 8.92 922 920 PGK'bn 19.68 900 880 880 17.96 17.35 860 840 FY2022 FY2023 FY2024 FY2022 FY2023 FY2024 FuA (PGK'bn) Member ('000) 14
Slide 15: Market share gains
Market share gains. • Capitalising on opportunities for deposit and lending market share growth in PNG. Market share percentage - lending Market share percentage - deposits 16,864 16,176 33,106 31,256 30,018 14,142 17.1% 13.9% PGK'bn PGK'bn 15.8% 15.3% 12.9% 13.1% 2,159 2,562 2,883 3,879 4,345 4,352
Slide 16: Corporate Tax
Corporate Tax. • In December of 2024, the PNG Government announced a gradual decrease in Corporate Income Tax on Commercial Banks from 45% to 2022 2023 2024 2025 2026 40% for 2025 and 35% for the 2026 fiscal year. Standard rate 30% 30% 30% 30% 30% • The increase in rate was effective as of 1 January
Slide 17: Asset Quality
Asset Quality. • Overall portfolio quality remains solid. • Elevated risk mainly in personal loan portfolio. 8.7% 8.1% 6.8% 6.5% 6.3% 5.4% 2.3% 1.9% 1.9% 2.0% 1.5% 0.8% 0.7% 0.4% 0.2% Impairment Exp % of GLA NPL % of GLA + 90 day arrears + 180 day arrears Provision % of GLA Dec22 FY Dec23 FY Dec24 F
Slide 18: Deposit tenure
Deposit tenure. FY2024 • Year on year, FY2023 12 months 24 months deposit profile 12 months 24 months 1% 2% 9% stability. 9% 6 months 5% 6 months 3 months 9% 2% 3 months 2 months 3% 6% 2 months 4% 1 month 8% 1 month On Call 7% On Call 68% 67% On Call 1 month 2 months 3 months 6 months 12 months 24 m
Slide 19: Capital adequacy
• Capital adequacy maintained in KSL’s target Capital adequacy. range, providing capacity for growth and supporting risk weighted assets of K2.8b and total assets of K5.2b 22.5% 20.0% 18.4% 12.0% FY2022 FY2023 FY2024 Capital Adequacy: T1 + T2 BPNG minimum total risk based capital 19
Slide 20: Strategy and Outlook
20 Strategy and Outlook. W Kina SecuritiesLimited
Slide 21: Values
Values. Our Vision is to be the most dynamic, progressive and accessible financial Vision. services organisation in the Pan Pacific region. Our Values. Our defining purpose is to constantly improve the prosperity of the Purpose. people, communities, and markets that we serve. Prosperity for our comm
Slide 22: Continuity of Strategy through CEO transition
Continuity of Strategy through CEO transition. • PNG’s challenger bank • A diversified portfolio, right for PNG’s market context • Bias towards digital solutions and partnerships • Inorganic growth exploration • Opportunity and growth at the heart of culture 22
Slide 23: Efficient growth
Efficient growth. One off costs FY24 • Fraud incident. • January 10 civil unrest. • Professional services for capability uplift in technology and risk. Management focus • Budget control. • Operating model, process improvement, and digitisation over the medium to long term. 23
Slide 24: Economy: Global Outlook
Economy. GLOBAL OUTLOOK Global GDP Outlook 10.0% Projections • Global growth is projected at 3.3% in 2025 and 2026, below the historical average of 3.7% (2000-2019). 8.0% • Global headline inflation is expected to decline to 4.2% in 2025 and 3.5% 6.0% in 2026, converging back to target earlier in ad
Slide 25: Economy: Domestic Outlook
Economy. DOMESTIC OUTLOOK 2025 PNG Growth Forecasts • PNG's real GDP is projected to grow by 4.9% in 2024 and 4.7% in 2025. • The resource sector is anticipated to grow by 5.9% in 2024 and 3.4% in 2025, Total GDP Growth 4.7% with higher output from major mines coinciding with historically high gold
Slide 26: Appendices
26 Appendices. () Kina SecuritiesLimited
Slide 27: Loan portfolio by industry
Loan portfolio by industry. 60 Other* 42 46 21 Equipment Hire 34 44 76 Transport & Storage 68 23 96 Hotel & Restaurants 75 79 97 Post & Telecommunication 97 - 251 Building and Construction 184 171 320 Other Business 286 213 Real Estate/Renting/Business 426 360 Services 316 759 Personal Banking 699 6
Slide 28: Deposit by products
Deposit by products. 2,009 1,864 1,637 1,443 1,471 1,430 PGK'm 564 497 512 472 327 350 Fixed Term Cash Management Accounts Current Account Savings Account FY2022 FY2023 FY2024 28
Slide 29: Thank you
29 Thank you. W Kina SecuritiesLimited