Oversea-chinese Banking Corporation Limited · SGX:O39
Oversea-chinese Banking — Q3 2006 Earnings Presentation
29 slides from Oversea-chinese Banking's earnings presentation, Nov 14, 2006
Slide 1: Third Quarter 2006 Results Presentation
Third Quarter 2006 Results Presentation 14 November 2006
Slide 2: Agenda
Agenda • Results Overview • Performance Trends • Results of Key Subsidiaries • Conclusion 2
Slide 3: Results at a Glance - Quarterly
Results at a Glance - Quarterly 3Q06 3Q05 YoY 2Q06 QoQ S$m S$m +/(-)% S$m +/(-)% Net Interest Income 473 413 15 435 9 Non-Interest Income 357 321 11 845 (58) - Fee Income 155 131 19 141 10 Total Income 831 735 13 1,280 (35) Operating Expenses (333) (298) 12 (349) (5) Operating Profit 498 437 14 931
Slide 4: Results at a Glance – Year to Date
Results at a Glance – Year to Date 9M06 9M05 YoY S$m S$m +/(-)% Net Interest Income 1,303 1,183 10 Non-Interest Income 1,550 925 68 - Fee Income 437 379 15 Total Income 2,854 2,108 35 Operating Expenses (989) (832) 19 Operating Profit 1,865 1,276 46 Amortisation of Intangibles (32) (30) 8 Allowances
Slide 5: Results Adjusted to Exclude Divestment Gains
Results Adjusted to Exclude Divestment Gains 9M06* 9M05 YoY Nine Months S$m S$m +/(-)% Total Income 2,338 2,108 11 of which: Non-Interest Income 1,035 925 12 Operating Profit 1,349 1,276 6 Net Profit 1,011 957 6 3Q06 2Q06* QoQ Quarterly S$m S$m +/(-)% Total Income 831 764 9 of which: Non-Interest In
Slide 6: Key Financial Ratios – Excluding Divestment Gains
Key Financial Ratios – Excluding Divestment Gains 9M06 9M05 3Q06 2Q06 3Q05 % % % % % Net Interest Margin 1.98 1.81 2.06 2.00 1.83 Non-Interest Income/ 44.3 43.9 43.0 43.1 43.7 Total Income Cost-to-Income Ratio 42.3 39.5 40.0 45.6 40.5 Loans-to-Deposits Ratio 82.6 87.4 82.6 81.7 87.4 NPL Ratio 3.3 4.
Slide 7: Agenda
Agenda • Results Overview • Performance Trends • Results of Key Subsidiaries • Conclusion 7
Slide 8: Net Interest Income and Margins Improving Steadily
Net Interest Income and Margins Improving Steadily 2.06% 1.98% 2.00% Net 1.91% 1.90% 1.89% 1.84% interest 1.78% 1.82% 1.83% margin 1,597 1,518 1,303 473 435 407 413 414 395 Net 363 interest income (S$m) 2004 2005 9M06 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 8
Slide 9: Average Yield and Cost of Funds Analysis
Average Yield and Cost of Funds Analysis Interest Interest Rate Ave Bal Third Quarter 2006 Inc / Exp Ave Rate YoY QoQ S$bn S$m % bps bps Customer loans 56.5 821 5.76 +117 +22 Placements with Banks 18.3 200 4.34 +139 -15 Securities/ Others 16.4 173 4.20 +65 +28 Interest Earning Assets 91.1 1,194 5.20
Slide 10: Higher Insurance and Fee Income Boost 3Q Non-Interest Income
Higher Insurance and Fee Income Boost 3Q Non-Interest Income Non- 46.3% 46.8% 46.8% interest 44.7% 44.3% 43.7% 43.1% 43.0% 41.8% income/ 39.1% Total income 1,550 1,289 845 516 1,108 Non- 132 interest 1,035 516 975 income (S$m) 364 357 321 348 312 291 329 2004 2005 9M06 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06
Slide 11: Quarterly Record in Fee Income
Quarterly Record in Fee Income Fee 18.9% 18.5% 18.7% 18.6% 18.7% income/ 17.6% 18.0% 18.1% 17.8% Total income 16.5% 507 464 437 155 140 141 126 131 128 122 Fee income (S$m) 2004 2005 9M06 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 Excluding divestment gains 11
Slide 12: Expenses up 12% YoY in 3Q06
Expenses up 12% YoY in 3Q06 45.6% Cost-to- 42.3% 41.5% 40.5% 40.5% 40.1% Income 39.6% 39.6% Ratio 37.3% 1,145 40.0% 988 989 278 349 333 226 259 312 308 298 223 283 252 93 89 Operating 216 81 77 201 67 71 Expenses (S$m) 57 76 64 56 61 66 61 51 634 546 529 160 165 165 170 179 179 143 2004 2005 9M06 1Q
Slide 13: Core Operating Profit at a Quarterly High
Core Operating Profit at a Quarterly High 1,865 Operating Profit 1,742 before allowances 1,637 (S$m) 931 132 516 1,505 1,349 516 498 466 424 415 437 435 416 2004 2005 9M06 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 Gains from divestment of non-core assets 13
Slide 14: Allowances Remain Low as Loan Recoveries Continue
Allowances Remain Low as Loan Recoveries Continue Allowances for 77 loans and other assets (S$m) 24 12 12 3 (2) (9) (7) (5) (23) 2004 2005 9M06 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 14
Slide 15: Core Net Profit Up 21% QoQ
Core Net Profit Up 21% QoQ 12.1% 11.6% 12.3% 11.4% 11.2% 10.8% 10.4% 10.3% 10.6% 10.7% ROE (%) 1,493 795 1,298 1,148 482 97 1,051 482 Net Profit 1,011 (S$m) 379 355 341 298 304 318 314 0 2004 2005 9M06 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 Gains from divestment of non-core assets Excluding divestment g
Slide 16: Earnings Contribution by Segments
Earnings Contribution by Segments Net Profit by Business Segment PBT by Geography Other Asia Insurance Pacific & Others Others 3% 1% 15% Other ASEAN 3% Treasury Consumer Banking 12% 26% Malaysia 26% Singapore Business 67% Banking 47% 9M06 Net Profit After Tax: S$1,011m 9M06 Profit before Tax: S$1,33
Slide 17: Loans Growth of 4% YoY, 2% QoQ
Loans Growth of 4% YoY, 2% QoQ Loans (S$bn) 59.4 57.0 57.2 58.1 56.5 56.6 53.6 9.6 10.3 9.2 9.1 9.2 8.8 7.6 9.8 9.7 9.6 9.8 10.1 9.2 8.8 37.1 38.2 38.1 38.3 38.1 38.6 38.9 Mar-05 Jun-05 Sep-05 Dec-05 Mar-06 Jun-06 Sep-06 Singapore Malaysia International 17
Slide 18: Loans-to-Deposits Ratio
Loans-to-Deposits Ratio 87.4% 90.0% 86.1% 85.6% 86.0% 84.6% 81.7% 82.6% Loans-to-deposits 85.7% 83.3% 83.7% 84.4% 80.0% 83.2% 81.2% 80.0% 68.7 69.6 63.6 62.8 64.1 64.5 59.7 70.0% 9.5 9.2 8.2 8.6 9.1 9.0 7.0 10.6 10.8 11.2 11.4 11.4 11.0 11.0 60.0% Deposits 45.4 46.7 (S$bn) 38.9 40.4 40.4 40.5 41.1 5
Slide 19: NPL Ratio Improved Further to 3.3%
NPL Ratio Improved Further to 3.3% NPL Ratio 4.8% 4.3% 4.2% 4.1% 4.1% 3.6% 2,705 3.3% 2,592 2,467 2,392 224 2,346 286 267 269 2,096 NPLs 258 1,966 (S$m) 886 290 821 745 262 708 701 683 673 1,596 1,485 1,454 1,416 1,387 1,123 1,031 Mar-05 Jun-05 Sep-05 Dec-05 Mar-06 Jun-06 Sep-06 Singapore Malaysia I
Slide 20: 97% Allowances Coverage
97% Allowances Coverage 94% 97% 87% 87% 88% 88% 84% Total Allowances / NPLs Specific Allowances / NPLs 49% 50% 48% 48% 48% 48% 46% Mar-05 Jun-05 Sep-05 Dec-05 Mar-06 Jun-06 Sep-06 20
Slide 21: Capital Position Remains Strong
Capital Position Remains Strong (%) Total CAR 17.7 17.3 17.9 16.6 17.0 14.7 15.8 4.4 4.2 4.1 3.9 Tier 2 CAR 4.1 2.9 4.0 13.3 13.2 13.1 13.7 12.9 12.5 Tier 1 CAR 10.7 (S$m) Mar-05 Jun-05 Sep-05 Dec-05 Mar-06 Jun-06 Sep-06 Tier-1 capital 9,138 7,853 9,008 9,302 9,268 9,881 9,575 Risk Weighted Assets 6
Slide 22: Agenda
Agenda • Results Overview • Performance Trends • Results of Key Subsidiaries • Conclusion 22
Slide 23: OCBC Malaysia: Quarterly Results
OCBC Malaysia: Quarterly Results 3Q06 3Q05 YoY 2Q06 QoQ Unaudited Results* RM m RM m +/(-)% RM m +/(-)% Net Interest Income 198 159 25 186 6 Islamic Banking Income 12 10 23 13 (7) Non Interest Income 63 73 (14) 65 (4) Total Income 273 241 13 264 3 Operating Expenses (113) (99) 14 (99) 14 Operating P
Slide 24: OCBC Malaysia: Year to Date Results
OCBC Malaysia: Year to Date Results 9M06 9M05 YoY Unaudited Results* RM m RM m +/(-)% Net Interest Income 551 457 20 Islamic Banking Income 37 30 23 Non Interest Income 201 192 5 Total Income 789 680 16 Operating Expenses (303) (270) 12 Operating Profit 486 410 19 Allowances (42) - >100 Tax (127) (1
Slide 25: OCBC Malaysia: Financial Ratios
OCBC Malaysia: Financial Ratios 9M06 9M05 3Q06 2Q06 3Q05 Unaudited Results* % % % % % Net Interest Margin 2.60 2.32 2.67 2.60 2.35 Non-Interest Income / 25.5 28.3 23.1 24.6 30.2 Total Income Cost-to-Income Ratio 38.4 39.7 41.4 37.5 41.0 RM Loans-to-Deposits Ratio 84 92 84 83 92 Gross NPL Ratio 5.8 6
Slide 26: GEH Contributed 20% of Group Net Profit
GEH Contributed 20% of Group Net Profit * GEH’s Contribution to 9M06^ 9M05 3Q06 2Q06^ 3Q05 OCBC’s Results S$m S$m S$m S$m S$m Total Income 450 384 160 149 127 Operating Expenses (84) (64) (26) (31) (24) Operating Profit 367 320 134 118 103 Amortisation of Intangibles (32) (30) (11) (11) (10) Tax (63
Slide 27: Bank NISP’s Nine Months Profit Doubled on Higher Revenues
Bank NISP’s Nine Months Profit Doubled on Higher Revenues 9M06 9M05 3Q06 2Q06 3Q05 Unaudited Results* RP bn RP bn RP bn RP bn RP bn Net Interest Income 638 528 228 210 175 Non-Interest Income 132 20 58 37 (41) Expenses (499) (400) (179) (162) (139) Operating Profit 271 148 108 85 (5) Allowances (26)
Slide 28: In Summary
In Summary • Operating trends improved steadily through the first nine months in all key geographical markets • Net interest income and fee income hit new highs in the third quarter; net interest margin at its highest in four years • Asset quality continues to strengthen, allowances remain low • Our
Slide 29: Third Quarter 2006 Results – Thank You
Third Quarter 2006 Results Thank You
Oversea-Chinese Banking — Q3 2006 Earnings Presentation on 6ix