Metropolitan Bank & Trust Co. · PSE:MBT
Metropolitan Bank & Trust — H1 2020 Earnings Presentation
27 slides from Metropolitan Bank & Trust's earnings presentation, Aug 4, 2020
Slide 1: Company Presentation 1H 2020
PRIVATE AND PROPRIETARY Company Presentation 1H 2020 Based on latest financial statements submitted to the Philippine SEC, PSE and BSP As of 30 June 2020 © Metropolitan Bank & Trust Company | Investor Relations | 4 August 2020 | 1H 2020 MBT Company Presentation This material was produced by Metroban
Slide 2: Earnings Call Panelists
PRIVATE AND PROPRIETARY Earnings Call Panelists 4 August 2020 Fabian S. Dee President Toto A. Tansingco Mylene A. Caparas Treasurer and Head, Institutional Banking Head, Financial Markets Jette C. Gamboa © Metropolitan Bank & Trust Company | Investor Relations | 4 August 2020 | 1H 2020 MBT Company P
Slide 3: Macroeconomic View
PRIVATE AND PROPRIETARY MACROECONOMIC VIEW © Metropolitan Bank & Trust Company | Investor Relations | 4 August 2020 | 1H 2020 MBT Company Presentation 3 This material was produced by Metrobank for information purposes only and is intended to be used in presentations by the Bank at investor meetings
Slide 4: Global COVID-19 Recession in 2020
PRIVATE AND PROPRIETARY Global COVID-19 Recession in 2020 Global Recession in 2020, Rebound in 2021 Philippines has space for fiscal stimulus Brent Oil prices still below previous years’ levels Philippine Peso strength/US Dollar under pressure © Metropolitan Bank & Trust Company | Investor Relations
Slide 5: Loose Monetary & Quantitative Easing
PRIVATE AND PROPRIETARY Loose Monetary & Quantitative Easing RRR cuts to support liquidity Deep policy rate cuts to record-low level 20% 20% 20% 20% 4.75% 4.50% 18% 18% 4.00% 4.00% 4.00% 3.50% 14% 12% 3.00% 2.25% 2013 2014 2015 2016 2017 2018 2019 4M20 2013 2014 2015 2016 2017 2018 2019 1H20 Support
Slide 6: Banking Industry
PRIVATE AND PROPRIETARY Banking Industry Loan growth had a strong start this year Deposit growth and M3 growth sustained in early months but this may be tempered by economic uncertainty but can slow down depending on overall market liquidity Loan growth Deposit growth 20% 19% 34% 16% 17% 16% 14% 11%
Slide 7: PH Big Banks: Adequately Capitalized
PRIVATE AND PROPRIETARY PH Big 3 Banks: Adequately Capitalized The country’s largest banks have substantial capitalization, way above the minimum threshold set by the BSP. 31 December 2009 30 June 2020 CAR Tier 1 CAR CET1 20.0 16.0 18.7 14.7 16.5 14.3 16.0 15.6 13.0 14.1 13.8 12.6 12.2 12.7 Min. CET
Slide 8: GDP Forecasts
PRIVATE AND PROPRIETARY Metrobank Economic Research Forecasts As of 31 July 2020 2019A 2020F 2021F GDP 6.0% -3.6% to -5.2% 7% to 8% Inflation 2.5% 2.5% 2.5% BSP RRP rate 4.0% 2.25% 2.50% RRR 14% 10% USDPHP Trend 50.7 50.1 49.2 With downward bias DBCC* -2.7% 7.6% ADB -3.8% 6.5% GDP Forecasts DISCLAIM
Slide 9: Financial Performance 1H 2020
PRIVATE AND PROPRIETARY FINANCIAL PERFORMANCE 1H 2020 © Metropolitan Bank & Trust Company | Investor Relations | 4 August 2020 | 1H 2020 MBT Company Presentation 9 This material was produced by Metrobank for information purposes only and is intended to be used in presentations by the Bank at investo
Slide 10: Performance Highlights
PRIVATE AND PROPRIETARY Performance Highlights Solid core business growth but moderated by continued provisioning and reserves build-up Net Income Operating Income Resilient core business; early build up of reserves Net interest income Non-interest income • Solid 22% NII growth, driven by lower fund
Slide 11: Net Interest Income
PRIVATE AND PROPRIETARY Net Interest Income NII expansion driven by strong CASA take up amid improved liquidity, leading to reduced funding cost Net Interest Income NIMs* consistently above industry +22% YoY MBT UKB 44.5 +41bps 4.24% YoY 36.5 23.1 3.83% Q2 18.4 Q1 3.58%* 3.38% 21.4 18.1 1H 2019 1H 2
Slide 12: Asset Mix
PRIVATE AND PROPRIETARY Asset Mix Prudent asset growth, and well-balanced asset mix with loans comprising the biggest share Total Assets Total Assets Breakdown Loans* Securities Other Financial Assets Other Assets +2% YoY 3% 3% 3% 2,451 15% 16% 18% 2,278 71 2,321 72 72 380 331 415 21% 21% 22% 516 47
Slide 13: Loan Portfolio
PRIVATE AND PROPRIETARY Loan Portfolio Contraction in loan portfolio reflective of the slowdown across industries Net Loans Net Loan-Deposit Ratio 86% 87% 1,484 -5% YoY 78% 1,398 1,333 1H 2019 FY 2019 1H 2020 1H 2019 FY 2019 1H 2020 Gross Loan Breakdown By Segment FY 2019 Loan Portfolio by Industry
Slide 14: Consumer Loans
PRIVATE AND PROPRIETARY Consumer Loans Limited demand in auto loans and mortgage during the lockdown, offset by resilient credit card receivables Consumer Loans Breakdown Consumer Loans By Segment Auto Housing Credit Card & Others +2% YoY 334 347 340 23% 26% 27% 91 +19% YoY 78 93 32% 32% 32% 108 110
Slide 15: Asset Quality
PRIVATE AND PROPRIETARY Asset Quality Mindful of the risks ahead, the Bank is proactively beefing up provisions even as NPL formation remains relatively benign NPLs1 amount NPL Ratio2 better than industry MBT UKB 2.09% 21.0 19.3 21.1 +1% 1.50% 1.60% 1.60% 1.56% YoY 1.30% 1H 2019 FY 2019 1H 2020 1H 2
Slide 16: Investment Securities
PRIVATE AND PROPRIETARY Investment Securities Actively managed securities portfolio strategically positioned to take advantage of ever-changing financial market conditions Investment Securities Investment Securities Breakdown FVTPL FVOCI HTC +5% YoY 7% 516 502 477 49% 37 55% 252 264 82% 410 39% 32%
Slide 17: Liabilities Mix
PRIVATE AND PROPRIETARY Liabilities Mix With a strong deposit franchise, funding is sourced primarily from traditional deposits led by low-cost CASA Total Liabilities Total Liabilities Breakdown Deposits Bills payable & SSURA Bonds payable Others +1% YoY 5% 5% 5% 2% 4% 5% 2,132 5% 11% 1,973 99 1,990
Slide 18: Deposit Profile
PRIVATE AND PROPRIETARY Deposit Profile Deposits have increased as customers prefer to stay liquid; strong CASA growth and low interest rates driving down funding cost Total Deposits Estimated Funding Cost* Cost of Funds Cost of Deposits As of 1H20, BSP cut: +5% YoY • 175bps in policy rates 2.3% • 2
Slide 19: Non-Interest Income
PRIVATE AND PROPRIETARY Non-Interest Income Despite market volatility, favorable interest rate environment helped healthy trading operations offset the weakness in service fees Service Fees and Trust Non-Interest Income Breakdown -13% YoY Service Fees & Trust Trading & FX gains Others 7.1 6.2 +55% Y
Slide 20: OPEX and Efficiency Ratios
PRIVATE AND PROPRIETARY OPEX and Efficiency Ratios Revenue growth has consistently outpaced cost growth, leading to improved cost-income ratio Operating Expenses Breakdown Cost-Income Ratio Manpower Taxes & licenses Depreciation Occupancy & equipment 56% 55% Others +7% YoY 45% 29.6 27.8 8.6 8.1 1H 2
Slide 21: Customer Touchpoints
PRIVATE AND PROPRIETARY Customer Touchpoints Slow down on opening of physical branches, and active push for e-channels to drive efficiencies and reduce the cost-to-serve. 22% Clients enrolled in e-channels as of Q2 2020 21% 31% mobile app downloads +176% Q2 2019 vs. Q2 2020 69% 79% Q2 2019 Q2 2020 C
Slide 22: Capital and Liquidity Ratios
PRIVATE AND PROPRIETARY Capital and Liquidity Ratios The Bank is highly liquid and well-capitalized, with capital and liquidity ratios comfortably above the regulatory threshold Total Equity Annual Cash Dividends Paid 323 4.5 310 297 4.0 1H 2019 FY 2019 1H 2020 1H 2019 1H 2020 Capital Ratios Basel I
Slide 23: Recent Developments
PRIVATE AND PROPRIETARY Recent Developments Approval of Merger Debt Issuance P10.5 billion bonds From the P100-Billion Bond Programme 24 June 2020 Debt Issuance Effective 03 January 2020 USD500 Million Medium-Term Note BSP approval From the USD2-Billion MTN Programme P25 billion LTNCDs 16 July 2020
Slide 24: Summary
PRIVATE AND PROPRIETARY SUMMARY Adverse effects of the unprecedented COVID-19 pandemic became more pronounced in the second quarter as economic activities ground to a halt during the quarantine. The Bank’s underlying business remains healthy - resilient NII growth, robust gains from the treasury bus
Slide 25: Financial Summary
PRIVATE AND PROPRIETARY Financial Summary In PHP billion Balance Sheet 1H 2019 1H 2020 YoY Income Statement 1H 2019 1H 2020 YoY Total Assets 2,278 2,321 +2% Net Interest Income 36.5 44.5 +22% Loans and Receivables, Net 1,398 1,333 -5% Total Deposits 1,624 1,701 +5% Non Interest Income 13.7 21.2 +55%
Slide 26: For more information, please visit our website
PRIVATE AND PROPRIETARY For more information, please visit our website: For your comments and queries contact us via: investor.relations@metrobank.com.ph Tel: (632) 8857 5348 DISCLAIMER: This material was produced by Metrobank Investor Relations Department for information purposes only and is intend
Slide 27: 27 This material was produced by Metrobank for information purposes only and is intended
PRIVATE AND PROPRIETARY by © Metropolitan Bank & Trust Company | Investor Relations | 4 August 2020 | 1H 2020 MBT Company Presentation 27 This material was produced by Metrobank for information purposes only and is intended to be used in presentations by the Bank at investor meetings and does not co
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