Emirates Nbd Bank (p.j.s.c) · DFM:EMIRATESNBD
Emirates Nbd Bank (p.j.s.c) — Emirates NBD — Q3 2019 Earnings Presentation
28 slides from Emirates Nbd Bank (p.j.s.c)'s earnings presentation, December 2019
Slide 1: Emirates NBD Investor Presentation
Emirates NBD Investor Presentation December 2019 2019 Presentation Title 1
Slide 2: Important Information
Important Information Disclaimer The material in this presentation is general background information about Emirates NBD's activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to
Slide 3: Agenda
1. Emirates NBD Profile 2. Financial & Operating Performance 3. Divisional Performance 7 4. Economic Environment 3
Slide 4: Emirates NBD is a Leading Bank in the MENAT Region
Emirates NBD is a Leading Bank in the MENAT Region Key Highlights as of Q3 2019 Emirates NBD at a Glance USD 184 Bn USD 117 Bn USD 18.9 Bn Assets Customer Loans Market Capitalization* 13 1,000+ 14.7 million Countries Branches Customers 3rd 2nd ~20% Largest in GCC** Largest in the UAE** Market Share
Slide 5: Emirates NBD at a glance
Emirates NBD at a glance Emirates NBD’s International Presence Market share in the UAE* Assets 18.5%; Loans 21.7%; Deposits Moscow 20.8% London 16 1 1 Germany 27 Austria Largest financial institution in Dubai, 3rd largest in the GCC Turkey Beijing 708 1 Leading retail banking franchise Bahrain
Slide 6: Emirates NBD is one of the largest banks in the GCC
Emirates NBD is one of the largest banks in the GCC % September 2019 vs. December 2018 Assets Loans Deposits Net Profit USD Bn, 30-Sep 2019 USD Bn, 30-Sep 2019 USD Bn, 30-Sep 2019 USD Mn, Jan-Sep 2019 YoY 250 7% 183 6% 181 7% 3,401 63% 215 6% 127 31% 130 2% 3,079 4% 184 35% 106 7% 127 35% 2,570 4% 1
Slide 7: Strong track record of profitability
Strong track record of profitability Consistently profitable due to diversified and resilient business model 10.3% 10.2% 9.9% 12.0% 17.4% 21.5% 19.6% 20.2% 22.1% 31.4% Record year for 6.9% revenue and profit 4.7 5.1% 4.4% 5.1% 4.5% 4.1 4.2 4.2 3.9 4.0 3.2 3.4 3.1% 2.6 2.7 2.8 2.7 2.3 1.9 2.0 1.6% 1.
Slide 8: Stable Shareholder Base and Diversified Business Model
Stable Shareholder Base and Diversified Business Model Split of ownership – Anchored by the Government of Dubai Foreign ownership limit (“FOL”) Ownership structure as at 30 September 2019 Investment Others Emirates NBD Corporation of 39.0% raised FOL to Emirates NBD Dubai (“ICD”) 5% 20% from 5% sign
Slide 9: Digital lifestyle banking continuing innovation
Digital lifestyle banking continuing innovation Recent Launches Liv. Sure, Smartphone insurance – a range of insurance products for millennials Olivia, a Millennial chatbot – a conversational AI (artificial intelligence) based chatbot Goal accounts – multiple goal based saving options for the custom
Slide 10: Emirates NBD delivered a strong set of results in Q3-19
Emirates NBD delivered a strong set of results in Q3-19 Key Metrics 2019 Macro themes Q3 2019 2019 YTD Guidance AED 12.5 Bn Regional Global Net Profit +63% y-o-y Profit NIM 2.82% 2.75-2.85% Cost to income 30.3% 33% • GCC growth • Slowing but growing supported by stable NPL 4.8% US economy Stable oil
Slide 11: Q3-19 YTD Financial results highlights
Q3-19 YTD Financial results highlights Highlights Key performance indicators (Including DenizBank from 1st Aug 2019) Better / AED Mn Q3-19 YTD Q3-18 YTD • Net profit of AED 12,483 Mn for Q3-19 YTD increased 63% y-o-y, (Worse) or 3% excluding DenizBank and the impact of the Network Net interest incom
Slide 12: Q3-19 Financial results highlights
Q3-19 Financial results highlights Highlights Key performance indicators (Including DenizBank from 1st Aug 2019) Better / Better / AED Mn Q3-19 Q3-18 Q2-19 • Net profit of AED 5,001 Mn for Q3-19 increased 90% y-o-y (Worse) (Worse) and 6% q-o-q Net interest income 4,271 3,307 29% 3,452 24% • The resu
Slide 13: Net interest income
Net interest income Highlights Net Interest Margin (%) • Q3-19 YTD NIM advanced 1 bp y-o-y to 2.82%, helped by higher margins from DenizBank 2.87 2.85 2.82 2.83 2.83 • Excluding DenizBank, NIMs declined 5 bps on higher deposit costs 2.77 2.82 2.83 2.82 2.81 • Q3-19 NIM of 2.83% improved 11 bps q-o-q
Slide 14: Loan and deposit trends
Loan and deposit trends Highlights Trend in Gross Loans by Type (AED Bn) • Gross loans excluding DenizBank grew 5% since start of the year with growth across all operating segments DenizBank Consumer +31% • Corporate lending grew 6% (27% including DenizBank due to growth Corporate Islamic* in agricu
Slide 15: Loan composition
Loan composition Total Net Loans (AED 429 Bn) Gross Loans (AED 465 Bn) Corporate 36% UAE 74% 3% GCC Sovereign 34% 12% Islamic 23% International 18% Retail Gross Corporate and Retail Loans (AED 249 Bn) Gross Islamic Loans* (AED 59 Bn) Others ** Fin Institutions Agriculture Manufacturing 4% Real estat
Slide 16: Non-interest income
Non-interest income Highlights Composition of Non Interest Income (AED Mn) • Core fee income increased by 26% y-o-y due to higher Q3-2019 Q3-2018 Better / AED Mn foreign exchange and credit card related income YTD YTD (Worse) Core gross fee income 5,573 4,314 29% • Investment Securities Income impro
Slide 17: Operating costs and efficiency
Operating costs and efficiency Highlights Cost to Income Ratio (%) • Q3-19 costs were AED 1,880 Mn, a 31% q-o-q and 28% y-o-y increase due to a rise in staff and operating costs relating to 32.9 33.5 32.8 international expansion 32.0 31.1 31.5 31.3 • Excluding DenizBank, quarterly costs increased 3%
Slide 18: Credit quality
Credit quality Highlights Impaired Loan & Coverage Ratios (%) • NPL ratio improved to 4.8% in Q3-19 as DenizBank loans recorded at fair value on acquisition date resulted in no addition to NPLs 127.9 128.4 127.4 127.3 126.6 • Cost of risk increased to 103 bps from 63 bps in 2018 on higher net 124.5
Slide 19: Capital adequacy
Capital adequacy Highlights Capitalisation • In Q3-19, capital ratios declined on growth in RWAs from DenizBank 21.3 20.9 22.0 21.5 20.9 • Capital ratios remain above the minimum regulatory requirements of 20.4 17.0 20.0 19.8 11% for CET-1 ratio, 12.5% for Tier 1 ratio and 14.5% for CAR ratio 16.8 1
Slide 20: Funding and liquidity
Funding and liquidity Highlights Advances to Deposit (AD) Ratio (%) • LCR of 149.3% and AD ratio of 91.8% demonstrates continuing healthy liquidity post DenizBank acquisition • Liquid assets* of AED 107.3 Bn as at Q3-19 (18% of total liabilities) 95.2 94.4 94.4 94.3 94.0 • In 2019, AED 12.7 Bn of te
Slide 21: Divisional performance (Excluding DenizBank)
Divisional performance (Excluding DenizBank) Retail Banking & Wealth Management • Revenue increased 10% y-o-y led by higher net interest income Balance Sheet Trends Revenue Trends AED Bn +1% AED Mn from liabilities and fee income driven by cards, loans and FX +10% • Liabilities grew by 1% backed by
Slide 22: Divisional performance (Excluding DenizBank)
Divisional performance (Excluding DenizBank) Wholesale Banking Balance Sheet Trends Revenue Trends • Wholesale Banking revenue slightly lower q-o-q and down 4% y-o-y as AED Mn AED Bn lower margins more than offset a growth in fee income +10% -4% • Net interest income lower 2% q-o-q mainly due compre
Slide 23: DenizBank Business Overview
DenizBank Business Overview Business Overview Financial Highlights Aug-Sep AED Mn** H1 2019 FY 2018 • DenizBank is the fifth largest private bank in Turkey 2019 YTD* • Wide presence through a network of 752 branches and 2,800+ ATMs Net interest income 869 2,461 5,242 • Operates with 708 branches in
Slide 24: UAE: 2019 GDP forecast to grow at 2%
UAE: 2019 GDP forecast to grow at 2% Highlights UAE oil production and prices 3.4 90 • The UAE’s crude oil output has been steady around 3.07mn b/d for UAE oil output (LHS) Brent oil (RHS) 80 most of this year, which is nearly 3% more than the average production in 2018 3.2 70 60 • UAE headline GDP
Slide 25: UAE: private sector credit growth slows in Q3 2019
UAE: private sector credit growth slows in Q3 2019 Highlights Breakdown of UAE bank credit by economic activity • Growth in UAE bank deposits slowed to 4.3% y/y in September, 12 % y/y AD Ratio (RHS) Bank Deposits (LHS) % 110 down from a 2019 peak of 9.1% in February. Resident deposits grew Bank Loan
Slide 26: Real estate: further softness in residential prices is expected in Q4 2019
Real estate: further softness in residential prices is expected in Q4 2019 Highlights Residential property prices • Dubai’s real estate prices have continued to decline in Q3 2019, as 10 have rents % y/y growth Dubai Abu Dhabi 5 • Data from ASTECO indicates that both villa and apartment prices decli
Slide 27: Dubai: travel & tourism activity slowed in Q3 2019
Dubai: travel & tourism activity slowed in Q3 2019 Highlights DXB passenger traffic (Jan-June) • Passenger traffic at Dubai International Airport (DXB) declined -5.6% 50 million people thousand tons 1400 y/y H1 2019. Cargo volume was down -18.3% y/y due to a runway 1200 closure for two months in Apr
Slide 28: Get in touch.
Get in touch. I N V E S T O R R E L AT I O N S Emirates NBD Head Office I 4th Floor PO Box 777 I Dubai, UAE IR@emiratesnbd.com Tel: +971 4 609 3046 28