Hong Leong Bank Bhd · MYX:HLBANK
Hong Leong Bank Bhd — Q1 FY2024 Earnings Presentation
21 slides from Hong Leong Bank Bhd's earnings presentation, Nov 30, 2023
Slide 1: Q1FY24 Results Analyst Presentation
Q1FY24 RESULTS ANALYST PRESENTATION 30 NOVEMBER 2023 The information contained in this presentation is strictly confidential for information of the intended recipient(s) only. The information may not be reproduced, redistributed or transmitted, directly or indirectly by any means to any other person
Slide 2: Financial Highlights: Q1FY24
1 FINANCIAL HIGHLIGHTS: Q1FY24 HLB Q1FY24 ended 30 September 2023 2
Slide 3: Key Financial Highlights
Key Financial Highlights Total Income Opex & CIR Profit before associates contribution • Resilient business performance driven by • Tightly managed cost, delivering a healthy • Healthy profitability before associates expansion in loan/financing portfolio and CIR contribution amidst the dynamic busin
Slide 4: Management Guidance
Management Guidance Target FY2024 Achieved Q1FY24 Gross Loans Growth 6%-7% 7.2% P Net Interest Margin 1.8%-1.9% 1.84% P We strive to achieve a set of Cost-to-Income Ratio ~40% 39.9% P encouraging results to GIL Ratio <0.70% 0.57% P deliver on our management Net Credit Cost ~10 bps -3 bps P guidance
Slide 5: Profit & Loss
Profit & Loss RM’mil 65 16 1,030 865 37 54 31 38 Resilient net PAT Q4FY23 Net Interest Non Interest Opex Loan & Other Associates Tax PAT Q1FY24 profit Income Income Impairment Contribution Allowances contributed by sustained non- Change % Change % interest income, RM’mil Q1FY23 Q4FY23 Q1FY24 (QoQ) (
Slide 6: Net Interest Income & NIM
Net Interest Income & NIM 2.18% 2.09% 1 bps 1.82% 1.83% 1.84% ▲ q-o-q Consecutive second quarter RM'mil of improvement 1,232 in NIM as a result 1,198 3.4% 1,089 1,126 ▲ q-o-q of effective 1,033 asset/liability management with the easing of funding cost pressure Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 Net
Slide 7: Non-Interest Income
Non-Interest Income 400 19.2% 17.9% 350 16.4% 300 268 Improved NoII RM’mil 268 Q1FY24 contribution 14 250 31 driven by higher 214 200 99 Credit Card ▲ 11.6% wealth 40 76 Related Fees RM57.7 mil management 150 27 income, credit Fee income: card and trade- 100 of which Wealth related fees and 156 147
Slide 8: Operating Expense
Operating Expense 37.1% Admin & general Domestic 33.9% 14% CIR Personnel cost Marketing 55% 7% 39.9% Q1FY24 ▪ Prudent 36.0% management of expenses through Establishment 556 24% strategic cost 541 management RM’mil 72 78 initiatives 50 39 RM'mil 134 134 ▪ Expenses kept 559 587 556 stable at current 5
Slide 9: Loans & Financing
Loans & Financing 7.2% +7,837 +3,787 +562 ▲ (+7.0%) (+8.5%) (+4.4%) 181,726 y-o-y RM’mil 169,452 8.0% y-o-y Strong growth Total Loans Q1FY23 Retail Business & Corporate International Total Loans Q1FY24 due to expansion Operations in key segments of mortgages, Q1FY24 auto loans, SME Domestic and comm
Slide 10: Asset Quality
Asset Quality Gross Impaired Loans/Financing (GIL) Loan/Financing Impairment Coverage (LIC) 1.80% 1.75% 1.71% 1.62% 317% 1.43% 282% 247% 239% 235% Stable asset 212% 212% quality metrics 0.61% 0.57% 0.57% 0.46% 0.49% with comfortable 169% 165% level of 142% loan/financing RM'mil 113% impairment 1,042
Slide 11: Asset Quality
Asset Quality Malaysia Overseas 300 0.59% 0.57% 250 0.51% 200 0.43% 0.46% 0.12% 150 806 982 968 100 60 62 50 14 - FY22 FY23 Q1FY24 FY22 FY23 Q1FY24 Credit portfolio remained healthy across the key Residential Properties Transport Vehicles SME segments 1.25% 1.06% 1.11% 0.45% 0.42% 0.38% 0.20% 0.22%
Slide 12: Deposit
Deposit 6.0% ▲ RM’mil +8,242 y-o-y +2,554 + 4,084 (+18.3%) (+27.0%) 209,163 197,400 (+2.5%) -3,118 (-8.7%) Continued focus to drive CASA growth through Total Deposits Retail Business & Global Markets International Total Deposits Q1FY23 Corporate Operations Q1FY24 cash management Q1FY24 solutions and
Slide 13: Liquidity & Capital
Liquidity & Capital Liquidity Ratios Capital Adequacy 145% 145% 137% 134% 137% 136% ▪ Maintaining strong liquidity and capital 16.7% positions 16.3% 16.5% 16.2% 15.9% 126% 127% 127% 15.7% 122% 14.1% 14.2% 14.1% 14.5% 13.9% ▪ LTF and LTFE 119% 13.6% ratios are well in 114% Industry line with the LDR
Slide 14: Shareholder Value
Shareholder Value Return on Equity, Return on Assets & EPS Net Assets & Earnings Per Share 186 161 140 • Commencing the 11.8% 12.1% new financial 10.9% year with encouraging results with 48 50 higher ROE of 1.34% 1.43% 1.46% 12.1% • Improved EPS at 15.1 16.6 15.2 16.7 50 sen 14.4 FY2022 FY2023 Q1FY2
Slide 15: Performance of Associated Company: Bank of Chengdu Co., Ltd.
Performance of Associated Company: Bank of Chengdu Co., Ltd. Financial Highlights for 9M ended 30 September 2023 (unaudited) Robust ROE 18.3% Operating Income Profit After Tax Solid Cost-to- RMB'mil 24.2% 15,246 16,702 RMB'mil income Ratio 10% 8,157 6,752 21% Prudent Coverage 516% Ratio 9MFY22 9MFY2
Slide 16: Closing Remarks
2 CLOSING REMARKS HLB Q1FY24 ended 30 September 2023 16
Slide 17: Closing Remarks
Closing Remarks ▪ Encouraging results led by sustained loan/financing growth, healthy asset quality and prudent funding and liquidity positions ▪ Prudent cost management results in sustainable levels of CIR below 40% A positive start amidst ongoing external ▪ Solid asset quality with a stable GIL ra
Slide 18: Supplementary Information
3 SUPPLEMENTARY INFORMATION HLB Q1FY24 ended 30 September 2023 18
Slide 19: Group Performance
Group Performance Change Change RM’mil Q1FY23 Q1FY24 Q4FY23 (YoY) (QoQ) Net interest income 1,232 1,126 -8.6% 1,089 3.4% Non-interest income 268 268 -0.2% 214 25.2% Total income 1,500 1,394 -7.1% 1,303 7.0% Operating expenses (541) (556) 2.9% (587) -5.3% Operating profit before allowances 959 838 -1
Slide 20: HLISB Key Highlights
HLISB Key Highlights Change Change RM’mil Q1FY23 Q1FY24 Q4FY23 (YoY) (QoQ) Total net income 226 232 2.7% 194 19.7% Operating expenses (68) (73) 7.7% (76) -4.0% Profit before taxation and zakat 158 159 0.6% 118 35.1% Profit after taxation and zakat 118 119 0.8% 88 35.1% Cost-to-income ratio 27.0% 31.
Slide 21: Thank You
Disclaimer This presentation has been prepared by Hong Leong Bank (“HLB”) for selected recipients for information purposes only and the information contained herein has been obtained from sources believed to be reliable. The information contained herein is believed to be correct as of the date of th
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