Burgan Bank · KSE:BURG
Burgan Bank — H1 2012 Earnings Presentation
26 slides from Burgan Bank's earnings presentation, Nov 15, 2012
Slide 1: Investor Presentation H1 2012
INVESTOR PRESENTATION H1 - 2012 Members of Burgan Bank Group: Members of Burgan Bank Group: 1
Slide 2: Agenda
Agenda Economic Highlights Key Highlights Financial Trends Financial Performance - Consolidated Performance vs. Peers Conclusion Appendix Members of Burgan Bank Group: 2
Slide 3: Economic Highlights
Economic Highlights Members of Burgan Bank Group: 3
Slide 4: Key Economy takeaways
Key Economy takeaways Global – Growth below Potential GCC & MENA – Oil still main driver Stable growth, but risks ahead from stressed global USA growth subdued with low economic markets & lack of credit growth in domestic arena growth forecasts. with low investment levels in a low interest environme
Slide 5: Key Highlights
Key Highlights Members of Burgan Bank Group: 5
Slide 6: Key Highlights
Key Highlights Core Earnings Revenue: KD 90.7 million with HoH growth of 11.4%; KD 48.1 million in Q2 12. Operating Profit: KD 55.9 million with HoH growth of 11.5%; KD 29.3 million in Q2 12. Net Profit: KD 31 million with HoH growth of 22.8%; KD 13.5 million in Q2 12. Leading Indicators Gro
Slide 7: Financial Trends
Financial Trends Members of Burgan Bank Group: 7
Slide 8: Financial Trends – H-o-H
Financial Trends – H-o-H Revenue (KD million) Cost of Credit (KD million) 2,591 ∆11.4% 90.7 2,252 2,136 2,152 81.5 13.5 11.8 ∆12.6% 8.6 3.6 7.4 9.5 48.1 3.9 4.6 8.2 42.7 3.5 4.0 4.0 Q2 11 Q2 12 H1 11 H1 12 Q2 11 Q2 12 FY 10 H1 11 FY 11 H1 12 Additional Provisions. Net Loans in KD million. Net Profit
Slide 9: Financial Performance - Consolidated
Financial Performance - Consolidated Members of Burgan Bank Group: 9
Slide 10: Financial Performance – Income Statement
Financial Performance – Income Statement Revenue (KD million) 48.1 42.7 43.5 42.6 38.8 38.4 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Operating Profit (KD million) 28.6 29.3 27.1 26.6 23.0 23.2 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 40.7% 36.5% 34.3% 39.5% 37.7% 39.1% Memb
Slide 11: Financial Performance – Income Statement
Financial Performance – Income Statement Cost of Credit (KD million) 12.9 5.0 8.6 7.4 4.4 3.9 4.4 7.9 5.0 4.6 4.6 4.0 3.5 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Additional Provisions. Net Profit (KD million) Net Profit (KD million)* 17.5 17.5 17.5 16.1 16.8 16.7 13.5 13.5 16.3 11.8 16.1 9.2 Q1 11 Q2 11
Slide 12: Financial Performance - Balance Sheet
Financial Performance - Balance Sheet KD (million) Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Loans & Advances 2,152 2,194 2,252 2,405 2,591 Total Assets 4,152 4,290 4,552 4,773 4,971 Deposits 2,500 2,608 2,796 3,039 3,164 Total Liabilities 3,602 3,731 3,986 4,205 4,386 Shareholder's Equity 434 441 447 450 468 L
Slide 13: Financial Performance - NPL Trends
Financial Performance - NPL Trends Non Performing Loans (KD million) 500 NPL Dropped KD11.7m QoQ 160% 400 150% 144.9% 138.9% 140% 300 266.2 254.5 130% 200 120% 100 70.1 75.5 110% 0 100% Q1 12 Q2 12 NPL NPL net of collateral Coverage net of collateral (RHS) NPLs net of collateral to Gross Loans (%) 6
Slide 14: Financial Performance - By Country
Financial Performance - By Country Members of Burgan Bank Group: 14
Slide 15: Revenues Diversity
Revenues Diversity Revenue H1 2012* Operating Profit Margins H1 2012* KD90.7m 70.4% 66.2% Jordan, 64.2% Burgan Group KD22.5m at 61.6% 25% 52.8% Kuwait, KD44.9m 43.3% 49% Algeria, KD16.0m 17% Tunisia, Iraq, KD1.8m KD6.1m Kuwait Jordan Algeria Iraq Tunisia 2% 7% Revenue Growth of 11.4% HoH; Led by Kuw
Slide 16: Contribution Summary by Country
Contribution Summary by Country Contribution for Q2 12* Total Assets 70.0% 16.6% 6.5% 2.8% 4.0% Customer Loans 71.7% 19.4% 7.5% 0.2% 1.2% Customer Deposits 67.5% 18.0% 7.1% 5.3% 2.1% Net Interest Income 54.5% 29.4% 9.4% 5.6% 1.1% Revenue 48.9% 26.2% 17.3% 6.9% 0.7% Operating Expense 47.6% 24.2% 15.0
Slide 17: Performance vs. Peers
Performance vs. Peers Members of Burgan Bank Group: 17
Slide 18: Operating Profit Growth- Conventional Banks
Operating Profit Growth- Conventional Banks Operating Profit Q2 12 vs. Q2 11 (KD million) Operating Profit H1 12 vs. H1 11 (KD million) 92.3 183.8 87.1 181.6 33.1 59.3 58.7 55.9 29.3 52.3 28.9 27.6 27.1 50.1 24.9 47.3 21.5 20.9 41.2 43.7 NBK ABK GBK CBK Burgan NBK ABK GBK CBK Burgan Tangible Equity
Slide 19: Returns of Conventional Banks
Returns of Conventional Banks Net Profit 1H 2012 vs. 1H 2011 - (KD Million) 146.7 120.8 31.0 28.4 25.3 21.2 18.3 12.8 1.5 0.5 NBK ABK GBK CBK Burgan 1H 2012 NBK ABK GBK CBK Burgan ROE 10.7% 8.8% 6.0% 0.2% 14.4% RONAV 11.8% 8.8% 6.0% 0.2% 23.9% ROE excluding additional reserve; 16.3% in 1H 2012. RONA
Slide 20: Conclusion
Conclusion Members of Burgan Bank Group: 20
Slide 21: Conclusion
Conclusion Consistent: Strategy, Business Model & Performance. Focus On: Strategic Goals, Building Performance & Managing Risk levels. Core Earnings: Firm despite stagnant environments. Leading Indicators: Moving in the right trajectory. Risk: In manageable levels & being reduced & strengt
Slide 22: Thank You
Thank You Members of Burgan Bank Group: 22
Slide 23: Appendix
Appendix Members of Burgan Bank Group: 23
Slide 24: External Recognitions - 2012
External Recognitions - 2012 Q1 2012 Q2 2012 Best Corporate Bank in Best Banking Brand – Kuwait – Banker Middle East Global Banking & 2012 Finance Review 2012 Best Banking Group in Best Banking Group MENA – In Kuwait – Global Banking & World Finance 2012 Finance Review 2012 Best Private Bank In Kuwa
Slide 25: Price Performance
Price Performance Conventional Banks Price Performance 1,100 1,050 1,000 950 900 850 800 750 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 NBK ABK GBK CBK Burgan Members of Burgan Bank Group: 25
Slide 26: Disclaimer
Disclaimer The information contained in this document has been provided on the basis of current knowledge, assumptions and expectations. In the event that any information is incorrect or any party misrepresented, Burgan Bank and its consultants cannot be held responsible for this. Various factors co