United Overseas Bank Limited · SGX:U11
United Overseas Bank — Non-Deal Roadshow (March 2009)
32 slides from United Overseas Bank's roadshow presentation, March 2009
Slide 1: UOB Group: Strength and resilience within a challenging market environment
UOB Group Strength and resilience within a challenging market environment Investor Roadshow March 2009 Disclaimer : This material that follows is a presentation of general background information about the Bank’s activities current at the date of the presentation. It is information given in summary f
Slide 2: Agenda
Agenda 11 Overview Overview of of UOB UOB Group Group 22 Macroeconomic Macroeconomic Outlook Outlook 33 UOB UOB in in the the Challenging Challenging Environment Environment 44 Growth Growth and and Regional Regional Strategy Strategy 55 Conclusion Conclusion 2
Slide 3: UOB Overview
UOB Overview Founding Key Statistics Founded in August 1935 by a group of Total assets : S$182.9 billion (US$127.9 billion) Chinese businessmen and Datuk Wee Shareholder’s equity : S$15.6 billion Kheng Chiang, grandfather of the present (US$10.9 billion) Gross loans : S$102.0 billion UOB Group CEO,
Slide 4: Proven Track Record of Execution
Proven Track Record of Execution Profit (S$ million) Acquired Buana in 2005 2007: S$2,109m Acquired BOA in 2004 2008: S$1,937m 2005: S$1,709m Acquired OUB 2004:S$1,452m in 2001 Acquired ICB in 1987 Acquired FEB 2000:S$913m in 1984 1995:S$633m Acquired LWB in 1973 Acquired Acquired CKB UOBR and 1985:
Slide 5: Sustainable Profit Contribution from Overseas
Sustainable Profit Contribution from Overseas Operating Profit by Geography 2008 2008 (in S$ million) 3,200 Singapore : 70% 2,854 301 Malaysia : 10% (2) 49 313 Thailand : 5% 2,488 2,337 78 619 216 Indonesia : 4% 163 59 2,032 41 627 Greater China : 2% 145 46 427 615 Other : 9% 318 2007 2007 (1) 2,230
Slide 6: Consistently Strong Financial Performance
Consistently Strong Financial Performance Net Interest Income and Net Interest Margin Net Profit After Tax (in S$ million) (in S$ million) 2,570 2,109 1,937 1,452 1,709 3.01% 3.18% 3.25% 3.21% 3.09% 2004 2005 2006 2007 2008 2.10% 1.99% 1.99% 2.04% 2.27% 0.78% 0.66% 0.93% 0.58% 0.56% Return on Averag
Slide 7: Diversified Non-Interest Income
Diversified Non-Interest Income Non-Interest Income (Non-NII) and Non-NII Ratio Non-Interest Income Breakdown (in S$ million) 37.6% 38.8% Investment- Trading & 33.9% 35.8% 31.9% Related investment 26.2% Other fee & 7% income 23.9% 23.7% 20.8% 21.7% commission 14% 3% Futures 1,278 broking Credit Card
Slide 8: Disciplined Cost Management
Disciplined Cost Management Operating Expenses and Expense / Income Ratio (in S$ million) (in S$ million) 41.1% 41.4% 39.0% 37.6% 37.9% 43.6% 39.2% 41.6% 39.4% 36.4% 2,018 2,050 1,736 272 285 1,424 256 556 518 532 496 504 1,227 67 71 76 222 67 71 188 2004 2005 2006 2007 2008 4Q 07 1Q 08 2Q 08 3Q 08
Slide 9: Well-Diversified Loan Portfolio
Well-Diversified Loan Portfolio Gross Customer Loans Breakdown Net Customer Loans / Loans-Deposits Ratio (in S$ million) Transportation / Storage / Other 86.6% 84.5% 81.4% 80.5% Communication 7% 78.5% Housing Loans 6% 23% 99,840 92,669 Manufacturing 10% 76,875 64,300 67,142 Building / Construction F
Slide 10: Conservative Provisioning
Conservative Provisioning Non-Performing Loans (NPLs)(1) Impairment Charges on Loans (in S$ million) (in S$ million) 36 bps 47 bps 8.0% 31 bps 18 bps 33 bps 5.6% 4.0% 324 5,484 1.8% 2.0% 19 bps 235 215 3,931 3,165 142 155 1,713 2,062 2004 2005 2006 2007 2008 2004 2005 2006 2007 2008 Individual impai
Slide 11: High Dividend Rate While Maintaining Robust Capitalization Levels
High Dividend Rate While Maintaining Robust Capitalization Levels Capital Adequacy Ratio (CAR) Net Dividend Rate (in %) (in cents) 16.1 16.3 24.2 12.3 15.6 15.3 22.8 14.5 45.0 40.0 41.0 32.0 32.0 11.0 11.0 11.0 10.9 16.0 16.0 16.0 16.4 20.0 10.0 2004 2005(1) 2006 2007 2008 Interim Final Dividend in
Slide 12: Awards and Accolades
Awards and Accolades “Best Domestic Bank” “Grand Prix for Best Overall “Best SME Bank in Asia “Best Local Cash Management Investor Relations – Large Pacific” Bank” Cap” “Best Local Currency Cash Management Services” 2008 2008 2007 “Best Local Private Bank “Top 10 Best Managed “Most Valuable Singapor
Slide 13: Agenda
Agenda 11 Overview Overview of of UOB UOB Group Group 22 Macroeconomic Macroeconomic Outlook Outlook 33 UOB UOB in in the the Challenging Challenging Environment Environment 44 Growth Growth and and Regional Regional Strategy Strategy 55 Conclusion Conclusion 13
Slide 14: Challenging Singapore Outlook
Challenging Singapore Outlook Leadership in ASEAN albeit challenging near-term prospects As a key Asian financial services hub, Singapore has continued to attract a multitude of global multinational banks and corporations, thereby contributing to significant economic progress over the recent years I
Slide 15: South East Asia: Resilient Macroeconomic Factors
South East Asia: Resilient Macroeconomic Factors Resilient Markets Improved Macroeconomic Balance from 1997 UOB’s Southeast Asian country pillars’ growth and economic prospects Levels remain stable despite the slowing US and European economies Economic fundamentals across the region remain weak in t
Slide 16: South East Asia Banking Sector: Stronger Fundamentals although Facing Headwinds
South East Asia Banking Sector: Stronger Fundamentals although Facing Headwinds in the Near- term Stronger Banking Indicators Near-term Concerns on Asset Quality Key structural issues related to weak financial systems and poor (Net NPLs, in %) governance have been addressed 7.9 7.8 7.2 7.2 Analysts
Slide 17: Agenda
Agenda 11 Overview Overview of of UOB UOB Group Group 22 Macroeconomic Macroeconomic Outlook Outlook 33 UOB UOB in in the the Challenging Challenging Environment Environment 44 Growth Growth and and Regional Regional Strategy Strategy 55 Conclusion Conclusion 17
Slide 18: One of the World's Leading Credits and Well-Capitalized Banks
One of the World’s Leading Credits and Well- Capitalized Banks Total Capital Adequacy Ratio (CAR) and Tier 1 CAR(1) 15.3% 15.7% 14.7% 13.0% 12.2% 10.9% 11.9% 10.8% 11.4% 9.2% 10.1% 8.3% UOB Citi JPMorgan Bank of America Deutsche HSBC Total CAR Tier 1 CAR Market Capitalization, Total Equity / Total A
Slide 19: Sound Balance Sheet Position
Sound Balance Sheet Position Stable & diversified customer loans portfolio (55% of assets or S$100 billion) • Spread out across countries, business segments and industries. Portfolio diversity remained stable • Credit quality intact with no major signs of deterioration. Maintain prudent approach • D
Slide 20: Strong Capital Position to Withstand Current Challenging Environment
Strong Capital Position to Withstand Current Challenging Environment Strengthened capital position with $1.32 billion preference share issue Strong CAR at 10.9% for Tier 1 & 15.3% for Total CAR - well above regulatory requirements Current capital level able to withstand near-term potential shocks an
Slide 21: The Bright Spots
The Bright Spots Asian economies more resilient and in position to rebound faster since it is less saddled with structural problems Governments in region have flexibility in providing fiscal safety nets to alleviate further shocks and stimulate economies. Strong fundamentals will continue to support
Slide 22: Agenda
Agenda 11 Overview Overview of of UOB UOB Group Group 22 Macroeconomic Macroeconomic Outlook Outlook 33 UOB UOB in in the the Challenging Challenging Environment Environment 44 Growth Growth and and Regional Regional Strategy Strategy 55 Conclusion Conclusion 22
Slide 23: Strategic Focus
Strategic Focus Information Technology Treasury Risk Consumers SMEs Management & Compliance Investment Operational Banking Excellence Human Resources To To be be recognized recognized as as aa leader leader in in consumer consumer and and SME SME banking banking services services in in the the regio
Slide 24: Strategic Directions
Strategic Directions Strengthen Domestic Market Further Grow Established Leadership in Core Segments Regional Franchise Establish Strategic Partnerships – Invest in Infrastructure and Talent Focused in High Growth Regions for the Future Our Our Mission: Mission: To To Be A Premier Bank in Be A Premi
Slide 25: Singapore Strategy
Singapore Strategy Maintaining housing loan market share in subdued environment Market leader in SME financing. Support government initiatives and remain committed to customers Opportunities in Corporate lending. Pricing power continues Asset quality intact - continued focus on quality credits and s
Slide 26: Overseas Strategy: Anchor Regional Franchise to Strategically Position for the Future
Overseas Strategy: Anchor Regional Franchise to Strategically Position for the Future See region as key to our future growth • Unique competitive advantages: Strong familiarity with the markets; Natural flow of customers’ regional expansions; Scalable infrastructure • Recognize potential upside in S
Slide 27: Key Markets' Developments and Strategy
Key Markets’ Developments and Strategy Thailand – Good turnaround China – Making inroads • Strengthened balance sheet and • Good progress following local operating platform incorporation • Pursue disciplined growth • Building RMB business, establishing infrastructure • Pace growth, stay focused at h
Slide 28: IT Management Strategy
IT Management Strategy Focus on aligning IT with the Business • Customer-centric processes • Differentiation through service and cost Create flexibility and capacity in IT infrastructure • Buy-not-build proven software packages where possible • Customer-centric & modular in architecture • Selective
Slide 29: Creating Scale – Shared IT Platforms
Creating Scale – Shared IT Platforms Consolidating of IT platforms across key subsidiaries since 2005/06. Using technology to bring the markets closer. Significant progress made. Examples are: • Credit cards: Singapore, Thailand, Indonesia, Hong Kong • Treasury: Singapore, Thailand, Indonesia, Hong
Slide 30: Managing Operational Risks in the Region
Managing Operational Risks in the Region From a collection of banks, critical to unify operating practices – from credit, service standards, market risks and back office practices Back Office is key in delivering a regional UOB Brand of service. Align to business strategy and priority Having seen th
Slide 31: Agenda
Agenda 11 Overview Overview of of UOB UOB Group Group 22 Macroeconomic Macroeconomic Outlook Outlook 33 UOB UOB in in the the Challenging Challenging Environment Environment 44 Growth Growth and and Regional Regional Strategy Strategy 55 Conclusion Conclusion 31
Slide 32: Why UOB?
Why UOB? Well-anchored regional bank with more than a local knowledge - a local Southeast Asia proxy network within each country Operating platform, risk management, and IT anchored back to well-regulated Strong integrated regional Singapore system franchise UOB well-positioned to ride through chall
United Overseas Bank — Non-Deal Roadshow (March 2009) on 6ix