Slide 1: Investor Presentation FY 2013 Financial Results
Investor Presentation FY 2013 Financial Results Mr. Kellee Kam Group Managing Director RHB Banking Group 24 February 2014
Slide 2: Agenda
AGENDA Executive Summary FY2013 Financial Results Integration Update Going Forward
Slide 3: Key Messages in 2013
Key Messages in 2013 ♦ The Group delivered a successful turnaround in profit trajectory from a 2.0% decline in profitability for the first 9M of the year ♦ PBT up 3.6% to RM2.47 bil and net profit up 2.6% to RM1.83 bil y-o-y ♦ Core operating businesses continued to deliver steady results, with 14.3%
Slide 4: RHB Banking Group Scorecard 2013
RHB Banking Group Scorecard 2013 Top Level Indicators Target 2013 Actual 2013 ROE 12.0% 11.5% Loans Growth 12% 9.2% Deposits Growth 10% -0.4% Gross Impaired <2.9% 2.8% Loans Ratio Cost to Income Ratio <50% 51.3% International Contribution 10% 11% 4
Slide 5: Quarterly Profit and ROE
Quarterly Profit and ROE 1400.0 18.0% 16.0% 1200.0 14.7% 14.8% 15.0% 13.4% 14.0% 1000.0 11.2% 11.5% 12.0% 9.9% 800.0 9.3% 739.8 10.0% 683.1 640.3 580.7 603.2 560.3 8.0% 600.0 553.7 559.1 487.5 494.3 504.5 435.6 453.8 6.0% 407.9 410.3 400.0 357.2 4.0% 200.0 2.0% 0.0 0.0% 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13
Slide 6: Agenda
AGENDA Executive Summary FY2013 Financial Results Integration Update Going Forward
Slide 7: Financial Results
Financial Results Q-o-Q Y-o-Y Quarter-on-Quarter: Q4 Q3 FY FY Change Change RM mil 2013 2013 2013 2012 % % ♦ Net interest income recorded a new quarterly high, driven by continued loans Net Interest Income 864 829 4 3,275 2,960 11 growth momentum of 2.4% (excluding a Other Operating Income 590 560 5
Slide 8: Profit Contribution by Entity
Profit Contribution by Entity PBT by Entity % Contribution by Entity RHB Bank RHB Islamic 3% 3% 4% 7% -6% +5% 2013: RM2,037 mil 2013: RM218 mil 2012: RM2,165 mil 2012: RM209 mil 93% 90% RHB Investment RHB Insurance Bank Group 2012 2013 +61% +11% RHB Bank Group RHB Investment Bank Group 2013: RM186 m
Slide 9: Total Income by Business Segment
Total Income by Business Segment Improvement seen across all other business segment, Treasury was impacted by financial market volatility RM mil Composition CIB GFB 2012 4,830 11% N1 +52% +107% 7% (6%) 24% CIB 505 (8%) (19%) 2013: RM1,474 mil 2013: RM654 mil 8% N1 2012: RM 969 mil 2012: RM316 mil (1
Slide 10: PBT by Business Segment
PBT by Business Segment CIB was impacted by higher loan loss impairment and Treasury recorded lower investment gain RM mil Retail Islamic Composition 2012 2,385 +9% +49% 5% Retail 86 7% (5%)(3%) 24% 2013: RM993 mil 2013: RM204 mil (29%) Islamic 67 2012: RM907 mil 2012: RM137 mil 14% (17%) N1 GFB 58
Slide 11: Income Mix
Income Mix Higher non-interest income ratio largely contributed by the merged RHB Investment Bank 29% 28% 24% 29% 33% 33% 34% 36% 37% 35% 9% 11% 10% 10% 10% 10% 10% 10% 10% 10% 61% 63% 65% 57% 57% 61% 56% 54% 53% 55% Q112 Q212 Q312 Q412 Q113 Q213 Q313 Q413 2012 2013 Net Interest Income Islamic Banki
Slide 12: Other Operating Income
Other Operating Income IB and wealth management related income - gaining strong traction RM mil Composition 2012 1,380 2013 6% Net Brokerage ▲233% 260 5% (6%) 372 (6%) Fund Management ▲359% 139 16% & UT Fee 178 (23%) Service Charges, Commission, Guarantee & Commitment Fees ▲22% 98 9% 534 64% (14%) C
Slide 13: Other Operating Expenses
Other Operating Expenses Cost-to-Income Ratio RM mil 2012 2,294 2013 (10%) Personnel 394 (8%) Cost ▲29% 1,734 51.3% Establishment 47.5% Cost ▲31% 145 617 43.5% Marketing Expenses ▲51% 116 346 Admin & General Expenses ▲38% 92 334 RHB-OSKIB Integration ▲103% 11 21 Cost 2011 2012 2013 2013 3,052 ▲33% 3
Slide 14: Allowances for Loan Impairment
Allowances for Loan Impairment Increase/(Decrease) in Allowances for Loan Impairment RM mil ▼ >100% 30 29 37 71 -133 419 448 148 2012 Recovered Written CA IA Others 2013 Off Asset Quality Allowances for Loan Impairment & RM mil Credit Charge Ratio RM mil 4,30 0 3.59% 4.0 0% 700 0.37% 0.6 0% 4,10 0 2
Slide 15: Group Financial Position
Group Financial Position Q-o-Q Y-o-Y ♦ Expansion in total assets driven by loans growth and Dec Sept Dec Change Change investment portfolio, partially offset by lower cash RM mil 2013 2013 2012 % % and short term funds Total Assets 191,090 187,668 189,112 2 1 ♦ Gross loans: Total Financial • Excludi
Slide 16: Loans, Advances and Financing
Loans, Advances and Financing RM mil 78 415 100 -486 1,436 -1,743 1,719 2,576 2,820 3,364 121,753 111,474 Dec 2012 Purchase of Purchase of Working Purchase of Personal Use Purchase of Purchase of Credit Card Merger and Others Dec 2013 Res. Property Securities Capital Non-Res. Transport PPE Other Acq
Slide 17: Loans Profile and Market Share
Loans Profile and Market Share Gross Loans & Growth (%) Gross Loans by Interest/Profit 22% Rate Sensitivity 25% RM bil 300 20% 16% 16% 14% 15% 11% 20% 13% 11% 250 10% 10% 9% 200 Fixed Rate 13% 14% 5% 8% 10% 8% 150 26% 0% -5% 100 -10% 97.4 111.5 121.8 Variable 83.9 50 -15% 69.6 Rate -20% 0 74% 2009 2
Slide 18: Loans By Type of Customers
Loans By Type of Customers Composition Loans by Type of Customers 1% RM mil 914 - 722 5% 6% 7% 7% 9% 2,903 11% 11% 10% 7% 7,184 28% 27% 26% 29% 30% 121,753 16% 13% 12% 10% 10% 111,474 44% 45% 45% Dec 2012 Individuals International SME Corporate & Dec 2013 43% 43% Others Dec 2013 55,093 10,910 12,433
Slide 19: Loans, Advances and Financing by SBG
Loans, Advances and Financing by SBG RM mil Retail Islamic Composition Dec 2012 111,474 7% +12% +15% (6%) 15% Retail 5,032 (15%) 2013: RM47,135 mil 2013: RM18,721 mil 39% 2012: RM42,103 mil 2012: RM16,266 mil (38%) 11% (10%) Islamic 2,455 GFB BBG 28% (31%) GFB 2,041 +32% +11% Retail 2013: RM8,343 mi
Slide 20: Customer Deposits
Customer Deposits Improvement in CASA mix to 23.3% from 21.3% RM mil FD CASA Dec 2012 138,228 -3% +9% Demand 2013: RM105,595 mil 2013: RM32,105 mil Deposits 2,067 2012: RM108,700 mil 2012: RM29,438 mil CA SA Saving 600 Deposits +9% +9% Fixed - 3,105 Deposits 2013: RM24,572 mil 2013: RM7,533 mil 2012
Slide 21: Customer Deposits Profile & Market Share
Customer Deposits Profile & Market Share RM bil Customer Deposits RM bil FD & NID Maturity Structure 23% 108.8 105.6 19% 95.8 1.0 0.7 15% 12% 23% 20% 88.1 89.3 89.5 19% 0.6 18.2 11.9 8% 250 15% 1.5 0.5 0.5 12.3 11% 12.3 10% 200 14% 14.8 15.8 9% 8% -0.4% 7% 0% 150 -2% 89.6 93.0 -10% 73.0 76.7 82.9 71
Slide 22: Funding & Leverage
Funding & Leverage Funding Composition CASA Composition RM bil 60.0 34.5% 1% 1% 1% 1% 1% 28.6% 3% 3% 2% 3% 3% 50.0 26.8% 29.5% 24.0% 23.3% 11% 11% 11% 11% 12% 21.3% 24.5% 40.0 19.5% 7% 8% 7% 8% 30.0 9% 14.5% 20.0 32.1 9.5% 25.4 27.8 29.4 10.0 24.3 4.5% - -0.5% 2009 2010 2011 2012 2013 CASA CASA Comp
Slide 23: Asset Quality
Asset Quality Gross Impaired Loans Ratio (%) by Purpose Gross Impaired Loans Ratio Working Capital Purchase of Residential (%) Property 4.59 6.1 5.3 5.3 3.9 4.4 3.4 3.59 3.59 3.36 3.33 2011 2012 2013 2011 2012 2013 3.12 3.15 2.99 2.95 2.92 2.81 2.68 2.54 2.23 2.13 1.99 2.03 1.99 1.96 1.85 Purchase o
Slide 24: Capital Position (1/2)
Capital Position (1/2) Times RHB Capital N1 0.8 152% 149% 0.7 0.63 136% 134% 0.6 0.54 130 % 0.5 0.39 0.4 0.36 0.3 0.2 80% Dec 2010 Dec 2011 Dec 2012 Dec 2013 Gearing Double Leverage RHB Bank Group: Capital Development in FY2013 ▲1.4% ▼0.4% 15.3% ▼2.0% 14.3% 10.8% 10.8% 8.0% 10.2% 10.3% 4.5% 3.5% Dec
Slide 25: Capital Position (2/2)
Capital Position (2/2) RHB Bank Total capital ratio for RHB Bank decreased mainly due to RM bil application of transitional arrangement with the 10% phased-out 25. 0 15.1% 14.0% of sub-debts and Hybrid Tier-1 and increase in business volume 15% 20. 0 11.4% 11.6% All entities are well positioned
Slide 26: Return to Shareholders
Return to Shareholders Market Capitalisation Dividend Per Share 8.72 10.00 7.48 7.69 7.90 26.38% 8.00 22.45% 25.41% 22.09% 5.30 19.2 20.1 6.00 16.30% 18.8 16.5 21.38% 17.41% 4.00 17.45% 16.09% 11.4 10.30% 2.00 8.0% 6.0% 6.0% 5.0% 5.0% 0.0 0.00 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 Market
Slide 27: Key Business Initiatives Update
Key Business Initiatives Update Easy by RHB Bank@ Work Pre-provisioning Companies in Secured PBT Profit Pipeline Companies +64% +103% +41% +215% 2013: RM274 mil 2013: RM149 mil 2013: 13,774 2013: 1,817 2012: RM167 mil 2012: RM 73 mil 2012: 9,797 2012: 577 No. of CASA A/c Gross Loans No. of Outlets W
Slide 28: Agenda
AGENDA Executive Summary FY2013 Financial Results Integration Update Going Forward
Slide 29: Integration Update
Integration Update Recap: Estimated Synergies Over 3 Years RM mil ♦ Single Platform Day 1 on 25 November 2013 324 ♦ 350 15 Synergies: 34 300 250 • RM137 mil realised post-completion, ahead of Year 1 target 200 149 150 112 5 o Derived mainly from Investment Banking, 63 5 17 275 Asset Management and I
Slide 30: Agenda
AGENDA Executive Summary FY2013 Financial Results Integration Update Going Forward
Slide 31: 2014 Target
2014 Target Target Actual Top Level Indicators 2014 2013 ROE >12.0% 11.5% Gross Impaired <2.5% 2.8% Loans Ratio Loans 12% 9.2% Growth CASA >15% 9.1% Growth Cost to Income Ratio <50% 51.3% International >12% 11% Contribution 31
Slide 32: Going Forward (1/2)
Going Forward (1/2) Outlook 2014 Global macroeconomic growth indicators continue to point to better prospect for advanced economies The Malaysia economy is improving and poised to strengthen to 5.4% for 2014 ♦ Exports are set to strengthen on account of better growth prospects in the advanced countr
Slide 33: Going Forward (2/2)
Going Forward (2/2) Summary For 2013, the Group successfully achieved a 3.6% increase in pre-tax profit despite a challenging first 9M of the year. This is a testament to our agility and ability to rise against challenges, steadfastness in executing against strategy to continue delivering value to a
Slide 34: Thank You
Thank You www.rhbgroup.com INVESTOR RELATIONS CONTACT: Ms Yap Choi Foong Group Chief Financial Officer +(603) 9280 2489 cfyap@rhbgroup.com Ms Teh Soh Geok Vice President +(603) 9280 2154 teh.soh.geok@rhbgroup.com This material is prepared for general circulation. Any recommendation or view contained
Slide 35: Appendix
Appendix Key Appointments in 2013 Key Business Highlights Major Awards 2013
Slide 36: Key Appointments in 2013
Key Appointments in 2013 Dato’ Ibrahim Bin Jamaluddin Bakri Rohan Christopher Loh Khairussaleh Hassan Krishnalingam Meng Heng Bin Ramli Managing Director, Managing Director, Group Chief Human Group Chief Group Chief Strategy RHB Bank Berhad RHB Islamic Bank Resource Officer Operations Officer and
Slide 37: Appendix
Appendix Key Appointments in 2013 Key Business Highlights Major Awards 2013
Slide 38: Retail Business Performance
Retail Business Performance Mortgage Personal Use 8.9% 7.4% 7.7% 7.4% 7.8% 7.1% 7.3% 7.0% 7.0% 6.6% 6.7% 5.7% 7.2 5.8 20.6 22.2 25.5 5.0 14.1 16.0 18.8 2.6 2.7 3.5 2008 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012 2013 Mortgage Loans (RM bil) Market Share Personal Use (RM bil) Market Share ASB
Slide 39: Easy by RHB
Easy by RHB Number of Outlets 268 245 25 25 70 50 ♦ PBT doubled to RM149 mil, contributing 6.0% to Group’s profitability 42 44 111 7 19 ♦ Loans recorded 32% growth, of which 71% was 32 128 129 contributed by ASB financing 2 14 53 July 2009 Dec 2009 Dec 2010 Dec 2012 Dec 2013 Easy Standalone Tesco PO
Slide 40: RHB Insurance Business Performance
RHB Insurance Business Performance General Insurance - Bancassurance - Gross Premium Gross Premium +53%▲ RM mil ^ RM mil 470 3.1% 3.3% 2.7% 2.3% 2.3% +15%▲ 126 307 307 109 83 536 132 344 467 383 224 271 305 62 198 70 2009 2010 2011 2012 2013 2010 2011 2012 2013 ^ As at Sept 2013 Gross Premium Market
Slide 41: CIB Market Share
CIB Market Share FY 2013 FY 2012** Market Share Ranking Market Share Ranking Debt Capital Market * 16.3% 4 14.9% 4 Mergers & Acquisitions - by value 11.8% 3 7.1% 11 - by deal count NA 1 NA 1 Equities Capital Market ^ 7.9% 3 2.6% 11 ** Combined RHBIB and OSKIB market data * Source : Bloomberg, Bursa
Slide 42: Equities, Futures & Asset Management
Equities, Futures & Asset Management FY 2013 FY 2012 AUM - Malaysia RM bil 10.0% 10.0% Equities Market Market Ranking Ranking (by value) Share Share 37.9 Malaysia 2.6% 1.7% 30.4 - By value 8.8% 3 11.6% 2 - By volume 14.3% 1 16.2% 1 21.7 14.9 Singapore 7.4% 6 7.3% 4 14.3 Hong Kong 0.2% 84 0.1% 108 12
Slide 43: Islamic Business Performance
Islamic Business Performance PBT Gross Loans RM mil 160 .0% RM bil 155 .0% 6.5% 6.9% 6.6% 150 .0% 145 .0% 140 .0% 215 135 .0% 5.6% +15%▲ 130 .0% 125 .0% 120 .0% 115 .0% 4.5% 110 .0% 105 .0% 165 100 .0% 95. 0% 90. 0% 85. 0% 80. 0% 75. 0% 115 70. 0% 211 209 218 65. 0% 60. 0% 55. 0% 50. 0% 18.7 45. 0%
Slide 44: Business Banking and SME
Business Banking and SME RM bil Gross Loans RM bil Customer Deposits 18. 0 11.2% 10.6% 15. 0% 15.4% 20. 0% 9.0% 16. 0 10. 0% 10.7% 10.2% 15. 0% 20. 0 7.7% 0.9% 10. 0% 14. 0 0.4% 5.0 % 4.0% 5.0 % 12. 0 0.0 % 15. 0 0.0 % 10. 0 -5.0% -5.0% 8.0 -10.0% 10. 0 -10.0% 12.9 17.8 6.0 10.5 10.5 11.7 -15.0% 14.
Slide 45: RHB Bank Singapore Business Performance
RHB Bank Singapore Business Performance 50 PBT 160 .0% Loans, Deposits & Total Assets SGD mil 155 .0% 45 150 .0% 145 .0% 140 .0% SGD bil 135 .0% 130 .0% 125 .0% 40 120 .0% 115 .0% 110 .0% 5.2 105 .0% 4.4 35 100 .0% 95. 0% 90. 0% 85. 0% 30 80. 0% 75. 0% 3.6 25 70. 0% 65. 0% 3.4 60. 0% 55. 0% 2.7 2.9
Slide 46: Appendix
Appendix Key Appointments in 2013 Key Business Highlights Major Awards 2013
Slide 47: Major Awards 2013
Major Awards 2013 Customer Service Singapore Quality Industry Excellence MSWG Annual Centre of the Year Class STAR Awards Award by MBA 2013 Corporate Governance Awards 2012 2012 Index & Award 2013 Bureau-de-Change (Bdc) 5th Business Excellence Award to Mr. Kellee Kam for Award to Dato’ Khadar by the