United Bank Limited · PSX:UBL
United Bank — Q3 2008 Earnings Presentation
32 slides from United Bank's earnings presentation, Oct 28, 2008
Slide 1: United Bank Limited Performance Review 3Q 2008
United Bank Limited Performance Review (Consolidated) 3Q 2008 October 28, 2008
Slide 2: Key Highlights
Key Highlights Profitability • PBT up 23% yoy at Rs. 14.0B • Non Interest Income up 40%; derivatives gains and strong fee income • Net Interest income up 15%; significant increase in advances • Provision charge of Rs 4.2 B, 11% up yoy • Milestone reached by successful automation of all 1082 domestic
Slide 3: Market Developments
Market Developments - Discount rate increased to 13% in July - CRR reduced from 9% to 5% by Nov 15th – Impact of Rs. 12 B - Removal of SLR on time deposits over 1 year – Impact of Rs. 8.6 B - Adv to Dep Ratio (ADR) to be maintained within 70% by March 31, 2009 - Merger of KASB and Atlas group to for
Slide 4: Summary
Summary Sep 2008 Dec 2007 Change Assets (PKR bn) 618 547 +13% Advances (PKR bn) 374 308 +21% Market Share-Adv- DOM 9.4% 9.4% Deposits (PKR bn) 465 412 +13% Market Share-Deposits- DOM 9.3% 9.1% Branches 1,102 1,095 +7 Automated branches 1,082 926 +156 Online branches 837 802 +35 ATMs 323 313 +10 ROAA
Slide 5: Share Info
Share Info Sep 2008 Dec 2007 EPS (Rs/share-annual.) 11.8 8.9 BV/share (Rs/share) 52.0 47.3 Price* - (Rs /share) 68.3 162.9 P/E 5.8x 18.4x P/BV 1.3x 3.4x # of shares 1,012M 1,012M * F ro ze n prize c by Augus t 27th 10/27/2008 1:58:02 PM 5
Slide 6: Income Statement (PKR bn)
Income Statement (PKR bn) QTD QTD % 9 month 9 month % Sep'08 Jun'08 Change Sep'08 Sep'07 Change Net Interest Income 7.78 6.99 +11% 21.33 18.57 +15% Non Interest Income 3.00 3.22 -7% 9.58 6.86 +40% Operating Revenue 10.78 10.20 +6% 30.91 25.44 +21% Operating Expense (4.32) (3.94) +10% (12.07) (10.31)
Slide 7: Balance Sheet (PKR bn)
Balance Sheet (PKR bn) % Mix- Mix- Sep'08 Dec'07 Change Sep'08 Dec'07 Cash & bank balances 73.6 68.6 +7% 12% 13% Investments 110.3 114.0 -3% 18% 21% Advances 374.4 308.3 +21% 61% 56% Fixed assets 20.4 19.0 +7% 3% 3% * * * * * * * * * * * * Total Assets 618.1 546.8 +13% 100% 100% Deposits 464.7 412.1
Slide 8: Financial Ratios
Financial Ratios Detail QTD QTD 9 month 9 month Full year Sep'08 Jun'08 Sep'08 Sep'07 Dec'07 Loan/Deposits 81% 71% 81% 74% 75% ROAE 25% 22% 24% 27% 23% ROAA 2.1% 1.9% 2.1% 2.1% 1.9% Cost/Income Ratio* 46% 45% 45% 48% 51% Gross NPLs/Gross Advances 6.4% 6.5% 6.4% 7.9% 6.9% Net NPLs/Gross Advances 1.9%
Slide 9: Deposit Structure
Deposit Structure Deposit Mix (YTD Sep 08) - Bank (Parent Company) Cost of Deposits QTD Jun'08 QTD Sep'08 Other Deposits – PKR 10bn Period Avg.Yield Period Avg.Yield Contribution 2% end Rs B /Cost end Rs B /Cost Cost 0.1% Fixed Deposits – PKR 166bn Saving deposits 161 3.9% 149 5.1% Contribution 37%
Slide 10: Advances by Business
Back to Balance Sheet Advances by Business Advances by Business 2006 2007 Sep-08 180 161 160 140 131 120 104 100 100 Rs B 80 64 60 55 54 49 47 44 40 39 40 20 13 8 11 - Corporate Bank Commercial Bank Consumer Bank Overseas Others (incl subsidiaries) % Net Advances Sep'08 Dec'07 Change Mix 08 Yield 08
Slide 11: Consumer Advances by Product
Consumer Advances by Product 2006 2007 Sep-08 Yield Sep 08 23 23% 23% 25% 24 21 21% 20 20 20% 16% 16 14% 14% 15% 12 10% 8 6 5 5 5 6 5 5 4 5 5 4 5 4 3 5% 4 2 0 0% Drive Address Credit Card Cashline Businessline Money % Sep'08 Dec'07 Change Mix 08 Yield 08 Yield 07 Drive 19.5 23.2 -16% 49% 13.5% 12.6%
Slide 12: QTD – Net Interest Income (Bank Level)
QTD – Net Interest Income (Bank Level) QTD Jun'08 QTD Sep'08 Interest Interest Average incom e / Avg.Yield Average incom e / Avg.Yield Balances (expense) /Cost Balances (expense) /Cost Interest Earning Assets Performing Advances 326,697 9,353 11.5% 335,834 10,547 12.5% Domestic 258,860 8,083 12.5% 2
Slide 13: Spread Analysis (bank level)
Spread Analysis (bank level) YTD September 2007 YTD September 2008 Interest Interest Average incom e / Avg.Yield Average incom e / Avg.Yield Balances (expense) /Cost Balances (expense) /Cost Interest Earning Assets Performing Advances 262,463 21,883 11.1% 320,912 28,051 11.6% Domestic 208,163 18,611
Slide 14: Concentration of Advances
Concentration of Advances A uto mo bile and transpo rtatio n equipment, 2.1% Financial, 2.4% Chemical and P harmaceuticals, Teleco m, 2.2% 1.4% Fertilizer , 1.5% Others, 17.6% Staff lo ans , 1.2% A irline/ A viatio n, 2.1% Fo o d industries, 1.7% Co ntracto rs, 0.6% A gribusiness, 6.6% Sugar, 1.5% C
Slide 15: Non Interest Income (PKR mm)
Non Interest Income (PKR mm) QTD QTD % 9 month 9 month % Full year Sep'08 Jun'08 Change Sep 08 Sep 07 Change Dec'07 Commission on consumer loan 497 396 +25% 1,279 1,125 +14% 1,478 Minimum balance charges 129 160 -19% 402 371 +8% 518 Commission on trade 345 332 +4% 995 758 +31% 1,022 Commission on re
Slide 16: Operating Expenses (PKR mm)
Operating Expenses (PKR mm) QTD QTD 9 month 9 month Full year Sep'08 Jun'08 Var % Sep 08 Sep 07 Var % Dec'07 Personnel cost 1,711 1,636 -5% 5,018 4,714 -6% 6,190 Premises cost 596 578 -3% 1,684 1,035 -63% 1,491 Outsourced serv.charges incl. sales comm 295 399 +26% 1,040 970 -7% 1,293 Advertisement a
Slide 17: E-Banking
E-Banking E-Banking Sep-08 Dec-07 Dec-06 % Change # of ATMs 323 313 210 +49% # of Transactions (M) 9.1 9.5 5.9 +60% Average transactions per day 33k 26k 16k +63% Total transaction amount (Rs B) 49 48 29 +65% Average transaction size (Rs 000) 5.3 5.0 4.9 +3% Average monthly transactions per ATM (Rs M
Slide 18: Financial Ratios (1 of 3)
Financial Ratios (1 of 3) Yearly YTD Q T D ( A n n u a liz e d ) DuPont . 2005 2006 2007 Sep 08 Mar-08 Jun-08 Se p-08 1 Net Interest Yield 4.5% 5.4% 5.0% 5.0% 4.8% 4.9% 5.1% 2 Net Interest Margin 5.4% 6.4% 6.1% 6.2% 6.0% 6.2% 6.5% 3 Non Interest Yield 1.7% 1.8% 2.0% 2.2% 2.4% 2.2% 2.0% Operating Exp
Slide 19: Financial Ratios (2 of 3)
Back main ratios Financial Ratios (2 of 3) Yearly YTD Q T D ( A n n u a liz e d ) Asset Quality . 2005 2006 2007 Sep 08 Mar-08 Jun-08 Se p-08 Gross NPLs / Gross Loan 7.7% 6.2% 6.9% 6.4% 6.8% 6.5% 6.4% Net NPLs / Gross Loan 1.7% 1.6% 1.9% 2.0% 2.0% 1.8% 2.0% Coverage Ratio 84.8% 82.6% 77.9% 74.5% 76.
Slide 20: Financial Ratios (3 of 3)
Back main ratios Financial Ratios (3 of 3) Yearly YTD Q T D ( A n n u a liz e d ) Other Metrics . 2005 2006 2007 Sep 08 Mar-08 Jun-08 Se p-08 Capital Adequacy Ratio 10.7% 12.2% 12.4% 11.5% 13.1% 12.7% 11.5% Tier-I CAR 7.7% 8.9% 8.8% 6.9% 8.3% 8.1% 6.9% Loan / Deposits 70.9% 74.1% 74.8% 80.6% 78.7% 7
Slide 21: Quarterly Trend Analysis
Quarterly Trend Analysis Bank Level 10/27/2008 1:58:02 PM 21
Slide 22: Profit Before Tax
Profit Before Tax 6.0 Before FSV(2007)/ERS/WWF 5.0 4 .7 5.0 4 .6 4 .4 4 .5 4 .4 4 .1 3 .8 4 .8 4 .5 4.0 Rs B 3 .4 4 .4 Reversal in Mar’07 of accruals in Dec’06 3.1 2 .1 1.9 2.1 Provision–PR amendment FSV / others ( Rs 1.975M) Provision–FSV ( Rs 1,829M) 1.1 ERS (Rs 307M) Sep 06 Dec 06 M ar 07 Jun 07
Slide 23: Profit after Tax
Profit after Tax 3.5 3 .1 3 .2 2 .9 3.0 2 .6 2 .6 2 .7 2 .2 2.4 Rs B Prior period tax adj. (Rs 402M) - one-off exp. 1.9 1.5 FSV 1.3 1.3 0.8 Sep 06 Dec 06 M ar 07 Jun 07 Sep 07 Dec 07 M ar 08 Jun 08 Sep 08 10/27/2008 1:58:02 PM 23
Slide 24: Deposits
Deposits 485 466 4 55 443 403 402 408 Saving deposits 401 381 Rs B 3 52 359 335 308 317 275 Sep 06 Dec 06 M ar 07 Jun 07 Sep 07 Dec 07 M ar 08 Jun 08 Sep 08 10/27/2008 1:58:02 PM 24
Slide 25: Advances
Advances 380 365 347 329 320 314 299 Rs B 280 280 281 2 52 247 235 248 215 Sep 06 Dec 06 M ar 07 Jun 07 Sep 07 Dec 07 M ar 08 Jun 08 Sep 08 10/27/2008 1:58:02 PM 25
Slide 26: Net Interest Income
Net Interest Income 8.0 7 .6 7.4 6 .8 6.8 Rs B 6 .4 6 .2 6 .1 6 .0 6.2 5 .8 5 .6 5 .6 5.6 5.0 Sep 06 Dec 06 M ar 07 Jun 07 Sep 07 Dec 07 M ar 08 Jun 08 Sep 08 10/27/2008 1:58:02 PM 26
Slide 27: Net Provision
Net Provision * 3.5 2 .9 2 .8 2.8 Provision–FSV Rs 1.829M) 2.1 Rs B Provision–PR amendment FSV / others ( Rs 1.975M) 1.3 1.3 1.5 1.2 0 .9 0 .5 0.8 0 .4 0 .4 0.1 Sep 06 Dec 06 M ar 07 Jun 07 Sep 07 Dec 07 M ar 08 Jun 08 Sep 08 * Excluding other operational Writeoffs 10/27/2008 1:58:02 PM 27
Slide 28: Non-Funded Income
Non-Funded Income 3.5 3 .1 3 .0 2 .9 3.0 2 .6 2 .3 2.5 Rs B 2 .2 2 .2 2 .1 2.0 1. 4 1.5 1.0 Sep 06 Dec 06 M ar 07 Jun 07 Sep 07 Dec 07 M ar 08 Jun 08 Sep 08 10/27/2008 1:58:02 PM 28
Slide 29: Total Revenue
Total Revenue 10.0 9 .1 8 .5 8.8 8 .2 7 .8 7 .4 7 .5 7.6 Rs B 6 .1 6.4 5 .8 5 .5 5.2 4.0 Sep 06 Dec 06 Mar 07 Jun 07 Sep 07 Dec 07 Mar 08 Jun 08 Sep 08 10/27/2008 1:58:02 PM 29
Slide 30: Administrative Expenses
Administrative Expenses 4.4 4 .2 3 .9 4.0 3 .8 WWF (Rs 102M) 3 .5 3.6 ERS (Rs 70M) Rs B 3 .4 3 .4 3 .4 Amor. cost (Rs 322M) ERS (Rs 307M) 3.3 WWF (Rs 203M) ERS (Rs 87M) 2 .9 2.9 2 .7 Reversals in Mar’07 of accruals in Dec’06 2.5 Sep 06 Dec 06 M ar 07 Jun 07 Sep 07 Dec 07 M ar 08 Jun 08 Sep 08 10/27/
Slide 31: Latest business statement as at September 30, 2008
The information contained herein reflects our latest business statement as at September 30, 2008 Except the historical information contained herein, statements in this Release which contain words or phrases such as ‘will’, ‘would’, ‘indicating’ expected to’ etc., and similar expressions or variation
Slide 32: Thank You
Thank You 10/27/2008 1:58:02 PM 32