Oversea-chinese Banking Corporation Limited · SGX:O39
Oversea-chinese Banking — Q1 2022 Earnings Presentation
25 slides from Oversea-chinese Banking's earnings presentation, Apr 29, 2022
Slide 1: First Quarter 2022 Results Highlights
First Quarter 2022 Results Highlights 29 April 2022 OCBC Financial Results Disclaimer: This presentation should be read as an overview of OCBC’s current business activities and operating environment which may contain statements relating to OCBC’s growth strategy and future business aspirations. Thes
Slide 2: Agenda
Agenda Financial Highlights Group Net Profit Group Performance Trends Note: - Certain comparative figures have been restated to conform with the current period’s presentation. - Amounts less than S$0.5m are shown as “0”; - “nm” denotes not meaningful; - “na” denotes not applicable; - Figures may not
Slide 3: Financial Highlights
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Slide 4: Robust 1Q22 Performance
Performance review Robust 1Q22 Performance ■ Group net profit up 39% QoQ with ROE higher at Total Income -9% +4% 10.6% S$2.64b YoY QoQ ■ QoQ income growth driven by higher net interest Group Net Profit Operating Expenses +5% -7% income, trading income and S$1.20b YoY QoQ life insurance profit S$1.36
Slide 5: 1Q22 Financial Highlights
Performance review 1Q22 Financial Highlights Banking Wealth Management ■ Banking operations net Net Profit (S$m) NII and Fee Income (S$m) WM Income (S$m) 1/ WM AUM (S$b) profit rose 50% QoQ, 42% 35% 34% supported by higher +4% unchanged +1% operating profit and sharp +50% -26% unchanged -2% drop in
Slide 6: Diversified Franchise Across Business and Geography
Performance review Diversified Franchise Across Business and Geography Operating Profit by Business Operating Profit by Geography Others Others Insurance 3% Global 7% Wholesale Singapore 18% Banking Greater China 3% 7% 21% 1Q22 1Q22 4Q21 24% 4Q21 23% 47% 42% 43% 42% 14% 19% 10% 15% 8% 18% Global Tre
Slide 7: Strong Balance Sheet Fundamentals
Balance sheet Strong Balance Sheet Fundamentals Loans-to-Deposits Ratio (%) Funding ■ Robust funding, liquidity and capital positions to Composition as at Mar 22 support growth 12% Customer deposits ■ Well-diversified funding mix 4% 3% Bank deposits with customer deposits 84.7 83.6 83.3 S$431b 81% D
Slide 8: Group Net Profit
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Slide 9: 1Q22 Group Net Profit
Net Profit 1Q22 Group Net Profit YoY Movement YoY -10% Positive on net profit 1Q22 (S$m) Negative on net profit QoQ +39% YoY ■ Higher NII led by loan growth, while Non-II lower against strong 1Q21 1Q21 Net Interest Non-interest Operating Associates Total Amortisation, 1Q22 Net Profit Income (NII) In
Slide 10: Group Performance
Group performance Group Performance 1Q22 1Q21 YoY 4Q21 QoQ OCBC Group S$m S$m +/(-)% S$m +/(-)% Net interest income 1,503 1,441 4 1,492 1 Non-interest income 1,140 1,473 (23) 1,058 8 Total income 2,643 2,914 (9) 2,550 4 Operating expenses (1,205) (1,149) 5 (1,289) (7) Operating profit 1,438 1,765 (1
Slide 11: Banking Operations Performance
Banking Ops performance Banking Operations Performance 1Q22 1Q21 YoY 4Q21 QoQ Banking Operations S$m S$m +/(-)% S$m +/(-)% Net interest income 1,478 1,417 4 1,467 1 Non-interest income 826 931 (11) 733 13 Total income 2,304 2,347 (2) 2,200 5 Operating expenses (1,129) (1,077) 5 (1,198) (6) Operating
Slide 12: Group Performance Trends
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Slide 13: Net Interest Income
Net interest income [xx]% YoY Net Interest Income 1Q22 YoY +4% 1.56% 1.58% 1.55% 1.52% 1.52% 1Q22 Net Interest Margin QoQ +1% 1,503 1,492 1,461 1,461 ■ NII up QoQ from asset 1,441 growth and margin expansion Net interest income (S$m) ■ NIM increased 3bps QoQ from improved loan yields which outpaced
Slide 14: Non-interest Income
Non-interest income Non-interest Income YoY -23% 1Q22 QoQ +8% 50.6% % of Group Income 43.2% 42.9% 41.5% 43.1% ■ Non-interest income lower 1,473 YoY due to exceptionally strong market environment in 1Q21 470 1,140 1,111 1,099 Non-interest Income (S$m) 1,058 ■ QoQ increase driven by a 68 254 330 rise
Slide 15: Net Fees & Commissions
Non-interest income Net Fees & Commissions YoY -11% 1Q22 QoQ -1% 585 563 569 ■ 1Q22 fee income down 68 528 522 from last year’s high 69 67 23 23 69 34 68 108 27 27 ■ Fees declined marginally Net Fees & Commissions (S$m) 117 124 QoQ due to lower credit 65 129 117 card, loan and trade- Others 2/ 58 55
Slide 16: Trading Income
Non-interest income Trading Income YoY -29% 1Q22 QoQ +48% ■ Trading income up QoQ driven by higher customer and non-customer flow 316 Trading Income (S$m) treasury income 80 Non-Customer Flow 225 212 Customer Flow 32 38 83 152 236 174 193 170 165 (13) (87) 1Q21 2Q21 3Q21 4Q21 1Q22 16
Slide 17: Operating Expenses
Operating Expenses Operating Expenses YoY +5% 50.5% 1Q22 44.3% 46.4% 45.6% QoQ -7% 39.4% Cost-to-income 1,289 ■ 1Q22 expenses higher 1,188 1,205 1,149 1,138 YoY mainly due to 280 increased staff costs 206 187 192 190 216 233 216 ■ Against the previous 206 213 quarter, costs fell largely Operating Ex
Slide 18: Allowances
Allowances Allowances YoY -73% 1Q22 QoQ -86% Credit costs (bps) 1/ 41 22 30 21 6 Total 50 21 18 24 ■ Credit costs eased to 6bps Impaired 4 from improving credit environment 317 Allowances (S$m) Allowances for 232 non-impaired assets 163 (ECL stage 1 and 2) 161 387 101 9 Allowances for impaired asset
Slide 19: Total Cumulative Allowances
Allowances Total Cumulative Allowances YoY -18% Mar 22 118% QoQ unchanged Total NPA coverage 104% 97% 90% 91% 4,763 ■ Total cumulative allowances largely 4,236 4,127 874 3,904 3,905 unchanged QoQ in line 444 444 with low net allowances 444 444 charge Cumulative allowances (S$m) 1,914 Regulatory Loss
Slide 20: Asset Quality
Asset quality Asset Quality YoY +7% Mar 22 1.5% 1.5% 1.5% 1.5% QoQ -1% 1.4% NPL ratio ■ Overall asset quality 4,243 4,338 4,307 remained healthy 4,027 4,082 123 118 95 89 91 403 372 378 ■ Total NPAs down slightly 476 517 243 Non-performing Assets (S$m) 586 604 QoQ, partly due to 324 332 recoveries a
Slide 21: Asset Quality
Asset quality Asset Quality S$m 1Q21 4Q21 1Q22 At start of period 4,005 4,243 4,338 ■ New NPA formation lower QoQ New NPAs Corporate/ Commercial Banking and Others 144 808 161 Consumer Banking/ Private Banking 231 249 135 375 1,057 296 Net recoveries/ upgrades Corporate/ Commercial Banking and Other
Slide 22: Customer Loans
Loans Customer Loans YoY +8% +9% in constant ccy terms Mar 22 QoQ +1% 285 290 294 +2% in constant ccy terms 271 275 Loans by Geography (S$b) 49 53 56 48 48 Rest of the world 67 70 73 74 74 ■ QoQ loan growth driven by Greater China 19 18 19 19 19 Singapore, UK, Australia 27 28 28 28 27 Indonesia and
Slide 23: Customer Deposits
Deposits Customer Deposits YoY +10% 85.6% 84.7% 84.5% 83.6% 83.3% Mar 22 Group LDR QoQ +2% 79.3% 77.8% 78.3% SGD LDR 76.7% 76.6% ■ Ample liquidity to support 68.8% 68.0% loan growth 67.0% 66.5% USD LDR 65.8% ■ Customer deposits rose YoY led by higher CASA 342 348 333 deposits 316 317 34 33 29 36 Cus
Slide 24: Capital
Capital Capital YoY -0.3ppt Mar 22 QoQ -0.3ppt 15.5 16.1 15.5 15.5 15.2 ■ Strong capital position with CET1 CAR (%) CET1 ratio at 15.2% to support strategic growth initiatives Mar 21 Jun 21 Sep 21 Dec 21 Mar 22 ■ Higher RWA YoY in line with loan growth CET1 Capital (S$b) RWA (S$b) 231 35.3 35.0 34.8
Slide 25: Thank You
First Quarter 2022 Results Highlights Thank You
Oversea-Chinese Banking — Q1 2022 Earnings Presentation on 6ix