Slide 1: Emirates NBD 2010 Results Presentation
Emirates NBD 2010 Results Presentation February 10, 2011 1
Slide 2: Important Information
Important Information Disclaimer The material in this presentation is general background information about Emirates NBD's activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to
Slide 3: Financial Highlights
Financial Highlights Total income for 2010 of AED 9.7 billion; -10% from 2009 Net interest income down 8% to AED 6.8 billion in 2010 given NIM impact of improved funding profile Core non-interest income trends stable compared to 2009 2010 operating costs down 14% to AED 3.1 billion from 2009
Slide 4: 2010 Financial Results
2010 Financial Results 2010 Financial Results Highlights Key Performance Indicators Total income of AED 9,721m; -10% from AED 10,794m in 2009 AED million 2010 2009 Change Q4 Q4 Change (%) 2010 2009 (%) Income includes write-downs of investment properties of AED 214m Net interest income 6,795 7,4
Slide 5: Income
Income Net Interest Margin Trends (%) Q4 2010 NIM of 2.41%; -10bps from 2.51% in Q3 2010: 3.01 – Negative mix impact of declining loan balances and rising customer Qtrly NIM 2.85 2.76 deposits with deployment of increased liquidity in lower yielding 2.65 2.60 2.59 2.54 2.51 assets 2.41 2010 NIM
Slide 6: Operating Costs and Efficiency
Operating Costs and Efficiency Highlights Cost to Income Ratio Trends The cost to income ratio improved by 1.5% from 32.9% in 2009 to 31.4% in 2010 Cost to income ratio (YTD) Operating costs declined by 14% to AED 3,053 million in 2010: 37.6 38.5 37.4 – 11% improvement in staff costs driven prim
Slide 7: Credit Quality
Credit Quality Loans & Receivables and Islamic Financing Highlights Loan Portfolio by Type – 2010(1) The Bank continues to pro-actively manage credit quality 100% = AED 205.4b Impaired loans as a percentage of gross loans increased to 10.0% in Q4 2010 from 8.1% in Q3 2010 and 2.6% in Q4 2009 Ret
Slide 8: Capital Adequacy
Capital Adequacy Highlights Capital Ratios - Basel II (AED billion) Capital adequacy ratio at 20.1% at end-2010 vs. 18.7% at end-2009 20.1% 18.7% Tier 1 ratio increased from 11.9% at end-2009 to 12.8% at end-2010 11.9% 12.8% 10.5% as profit generation for the period exceeded the FY 2009 dividend
Slide 9: Funding and Liquidity
Funding and Liquidity Highlights Loan to Deposit Ratios (%) Liquidity continues to improve and deposit mobilisation initiatives Headline LTD Ratio % proved successful; headline LTD ratio 99% at end-2010 Adjusted LTD Ratio % 129% Liquidity backstop facilities of AED 39.3b unused; net liquid asset
Slide 10: Divisional Performance
Divisional Performance AED billion AED million Key focus during the period was on balance sheet optimisation, -9% continued proactive management of credit quality, building non-risk 172.4 161.1 4,835 Corporate Banking based and fee generating businesses 4,400 Revenue declined 9% year-on-year due
Slide 11: Divisional Performance (cont'd)
Divisional Performance (cont’d) AED million Revenue increased by 19% in 2010 to AED 701m driven +19% Global Markets & primarily by growth in trading revenues partly offset by a 701 contraction in the spreads generated from interbank funding and 590 Treasury the mix impact of increased net liquid a
Slide 12: Two years on from the crisis, the Bank is better positioned for the future
Two years on from the crisis, the Bank is better positioned for the future Capital Ratios – Basel II Loan to Deposit Ratios Liquid Assets 20.1% 7.3% 20.4% Stronger 10.5% 9.7% 11.1% capital base 2.0% 129.0% 109.0% -9.5% 12.8% 99.0% 88.0% and liquidity 8.5% 2008 2010 Net Liquid Assets Ratio (%) 2008 2
Slide 13: Emirates NBD's strong brand, culture and franchise
Emirates NBD’s strong brand, culture and franchise 13
Slide 14: Summary of major achievements in 2010
Summary of major achievements in 2010 Achievements Proactive Liquidity Management by the Group has resulted in significant improvement of CAR strengthened to liquidity, manifested through strong increase in customer deposit base both in Wholesale as 20.1% from 18.7% at well as Consumer Banking e
Slide 15: Summary of major achievements in 2010
Summary of major achievements in 2010 Achievements Stress Testing – The Group advanced its comprehensive multi-period Stress Testing framework, which supports Underlying credit senior management in identifying and managing risks in the portfolio in order to ensure adequate metrics within capital
Slide 16: Strategic Imperatives are Evolving
Strategic Imperatives are Evolving Gradual Shift in Focus from Strengthening the Bank to Growth Acceleration 2008 2009 2010 2011 2012 Crisis Growth Manage Strengthening the Bank Acceleration ment 1. Optimise Balance Sheet 1. Optimise Balance Sheet • Capitalisation • Capital allocation • Liquidity •
Slide 17: Strategic Imperatives for 2011
Strategic Imperatives for 2011 Objectives Increase lending activities in identified pockets of growth, e.g. SME lending, cards, … Optimise Balance Sheet Further diversifying funding sources with a focus on reducing cost of funding and Capital allocation Review all Group companies (subsidiaries
Slide 18: Network International: Strategic Partnership with Abraaj Capital
Network International Strategic Partnership with Abraaj Capital Transaction Summary & Strategic Rational Financial Impact on Emirates NBD On 22 December 2010, Network International (NI) entered into a In 2010, the assets and liabilities are disclosed as assets held for strategic partnership with
Slide 19: Outlook
Outlook While economic activity remained relatively subdued in 2010, the satisfactory agreement on Dubai World restructuring and confidence and core economic sectors in Dubai continue to show signs of recovery Dubai remains well-positioned: Due to its strategic location and advanced infrastruc
Slide 20: Summary
Summary Robust financial performance despite significant impairments on credit portfolio and associate investments Cost rationalisation initiatives proving successful evidenced by reductions in absolute levels of expenses and in the cost to income ratio Significantly improved liquidity metrics
Slide 21: Investor Relations
Investor Relations PO Box 777 Emirates NBD Head Office, 4th Floor Dubai, UAE Tel: +971 4 201 2606 Email: IR@emiratesnbd.com Ben Franz-Marwick Head, Investor Relations Tel: +971 4 201 2604 Email: bernhardf@emiratesnbd.com Emilie Froger Investor Relations Coordinator Tel: +971 4 201 2606 Email: Emilie