Slide 1: Investor Relations Presentation
Investor Relations Presentation December 2016
Slide 2: Contents
Contents 1. QNB at a Glance 2. QNB Comparative Positioning – Qatar and MEA 3. Financial Highlights – as at 31 December 2016 4. Economic Overview Notes: All figures in US Dollars have been converted from Qatari Riyals based on the exchange rate of 1 US Dollar = 3.6405 Qatari Riyals In certain cases,
Slide 3: QNB at a Glance
QNB at a Glance
Slide 4: QNB at a Glance: Overview
QNB at a Glance: Overview Overview • Established in 1964 as the first Qatari owned Financials2 (in USD billion) bank • Owned (50%) by the Government of Qatar via 2016 2015 5yr CAGR the Qatar Investment Authority (QIA) Total Assets 197.7 147.9 19% • Largest bank in Qatar by market cap., assets, Loans
Slide 5: QNB's International Footprint
QNB's International Footprint Sub-Saharan Africa Middle East South Sudan: (1 Branch) Qatar: (66 Branches) Jordan: (1302 (+32) Branches, 34.5% stake Togo: (1,268 Branches1, 20.0% stake in in Housing Bank of Trade & Finance) Ecobank) UAE: (27 (+12) Branches, 40.0% stake Asia in CBI) Indonesia: (48 Bra
Slide 6: Rating Excerpts
Rating Excerpts “A+” “Our stable outlook on Qatar National Bank (QNB) reflects the bank’s resilient financial performance supported by its core franchise in Qatar as well as its expected extraordinary support from the Qatari Government” May 31st, 2016 “Aa3” “The standalone rating reflects: (1) consi
Slide 7: QNB Comparative Positioning – Qatar and MEA
QNB Comparative Positioning – Qatar and MEA
Slide 8: Top Domestic Banks – December 2016
Top 5 Domestic Banks – December 2016 QNB continues to excel in the domestic market Assets Loans 197.7 143.0 38.4 35.8 27.0 25.1 24.8 21.4 18.6 16.3 Deposits Net Profit 139.2 3.40 26.2 19.5 0.59 0.57 15.9 15.3 0.29 0.22 Note: All amounts are in USD billions 8 Source: Companies’ December 2016 Press Re
Slide 9: Top MEA Banks – December 2016
Top 5 MEA Banks – December 2016 QNB improved its position as the leading bank in the region Assets Loans 197.7 143.0 182.6 142.4 97.0 122.0 117.7 79.1 77.6 67.6 NBAD 1 NBAD 1 + FGB + FGB Deposits Net Profit 139.2 3.40 3.09 109.0 2.48 84.6 84.1 2.17 80.9 1.97 NBAD 1 NBAD 1 + FGB + FGB Note: All amoun
Slide 10: QNB is the leading MEA financial institution by brand value and market capitalisation
QNB is the leading financial institution in the MEA region with regards to brand value and market capitalisation Brand value and market capitalisation (USD Bn as at 31-Dec-16) Top MEA banking brands Top MEA banks by market capitalization 3.83 37.6 3.41 27.3 2.50 22.7 2.13 21.1 1.97 17.4 Source: Bran
Slide 11: Financial Highlights – as at December 2016
Financial Highlights – as at 31 December 2016
Slide 12: QNB continues to demonstrate sustainable profitable growth
QNB continues to demonstrate sustainable profitable growth Financial Highlights (as at 31 December 2016) Growth vs. December 2015 • Net interest margin (NIM)2: 2.89% • Cost to income ratio: 30.4% Profit1 • USD3.4 billion +10% • Earnings per share: USD 4.0 • ROAA : 1.97% • USD197.7 billion assets +34
Slide 13: QNB ALAHLI
QNB ALAHLI Highlights (as at 31 December 2016) Growth vs. December 2015 • Net interest margin (NIM)2: 5.28% • USD376.2 million +10% Profit1 • Cost to income ratio: 25.5% (EGP3,773 million) (+43%) • ROAA: 2.7% • USD10.6 billion assets -38% (EGP 191.8 billion) (+44%) • NPL (% of gross loans): 2.7% Ass
Slide 14: QNB FINANSBANK
QNB FINANSBANK Highlights (as at 31 December 2016) Growth vs. December 2015 • Net interest margin (NIM)2: 5.41% • USD370.2 million +31% Profit1 • Cost to income ratio: 50.1% (TRY1,119 million) (+45%) • ROAA: 1.2% • USD29.8 billion assets -2% (TRY105.3 billion) (+19%) • NPL (% of gross loans): 5.8% A
Slide 15: Increasing geographical diversification positively contributes to growth
Increasing geographical diversification positively contributes to growth Geographical Contribution (as at 31 December) Domestic International % Share of International as percentage of the total Net Profit1 Loans Deposits USD billion USD billion USD billion 3.40 143.0 139.2 3.09 2.87 108.6 106.7 98.2
Slide 16: Strong profitability growth
Strong profitability growth Income Statement Breakdown (USD billion as at 31 December) Net Profit1 Operating Income2 Net Interest Income % RoAE4 % Cost to Income Ratio % Net Interest Margin3 5 yrs: 10% 3.40 6.34 4.91 3.09 5 yrs: 18% 5 yrs: 18% 2.87 2.60 4.34 4.47 3.37 3.50 2.29 4.04 3.18 3.16 2.51 2
Slide 17: Good asset growth driven by lending activities mainly in QAR and USD
Good asset growth driven by lending activities mainly in QAR and USD Assets Analysis (as at 31 December) Total Assets Evolution 2016 Split of Assets (%) USD billion By Type By Currency 197.7 Cash and QAR 40.2 Balances with 6.0 5 yrs: 19% Central Banks USD 29.6 147.9 Due from 6.4 133.6 Banks TRY 8.2
Slide 18: Good loan growth
Good loan growth Loans Analysis (as at 31 December) Total Loans Evolution 2016 Split of Loans (%) USD billion By Geography By Sector 143.0 Qatar 68.5 Government 20.4 5 yrs: 22% Turkey 13.2 Government 25.2 106.7 Agencies 92.9 Egypt 3.8 Services/ 85.3 23.4 Commerce 68.7 Europe 5.3 Real Estate 12.5 Oth
Slide 19: High quality lending portfolio is highlighted by low NPL ratios
High quality lending portfolio is highlighted by low NPL ratios Asset Quality Analysis (as at December unless stated) Non Performing Loans (NPL) by Segment • QNB has continued to x Total NPL’s increase its provisions in USD million response to the global 1,532 1,530 2,600 economic situation 1,188 1,
Slide 20: High quality investment portfolio with 85% of securities rated AA or Sovereign
High quality investment portfolio with 85% of securities rated AA or Sovereign Investments Analysis (USD million as at 31 December 2016) Available-for-Sale Investment Securities Held to Maturity Financial Investments Quoted Fixed rate Unquoted Floating rate State of Qatar 4,061 State of Qatar 5,223
Slide 21: Robust growth in customer deposits and funding
Robust growth in customer deposits and funding Funding Analysis (as at 31 December) Total Customer Deposits Evolution 2016 Split of Deposits (%) USD billion By Sector By Type 139.2 Government 4.3 Time 76.9 Deposits 5 yrs: 20% 108.6 Government 17.9 98.2 Agencies Saving 91.8 2.5 Accounts 74.0 Corporat
Slide 22: Solid liquidity profile
Solid liquidity profile Liquidity Analysis (as at 31 December) Loans to Deposits Ratio Evolution 2016 Sources of Liquidity % % of total liabilities 98.3% 102.7% 92.7% 93.0% 94.6% Due to Banks 9.5 Customer Deposits 78.1 Debt 4.4 Securities 2012 2013 2014 2015 2016 Other 3.7 Borrowings Liquid Assets1
Slide 23: Sources of Institutional Funding
Sources of Institutional Funding EMTN and Certificate of Deposits EMTN1 Certificate of Deposits Set-Up • November 2011 in Reg S format • Issued by QNB London Branch and regulated by Set-Up the FCA and the PRA Current • Programme limit USD17.5 billion and outstanding Values is USD11.1 billion Establi
Slide 24: Strong capital adequacy ratio maintained above QCB and Basel III requirements
Strong capital adequacy ratio maintained above both QCB and Basel III requirements Capital Analysis (as at 31 December) Total Equity1 Evolution Basel III Capital Adequacy Ratio USD billion x Gearing2 % 18.4 16.0 16.3 16.0 14.1 14.1 (QCB) 2014 2015 2016 2015 2016 9.5 9.2 10.7 • Capital adequacy ratio
Slide 25: Diversifying business mix will bolster sustainable growth
Diversifying business mix will bolster sustainable growth Business Mix Contribution (% share as at 31 December 2016) Lines of Business Net Profit1 Op. Income Loans Deposits 91 78 88 75 • Maintain dominant domestic Group market share Corporate • Grow international contribution • Nurture SME business
Slide 26: QNB Group Financials
QNB Group Financials Key data (as at 31 December 2016) QNB QNB incl. QNB ALAHLI QNB incl. QNB Finansbank % Contribution of QNB AA % Contribution of QNB Finansbank Financials Ratios Presence USD billion 3.40 198 21.3% 114% 28,215 108% 3.02 173 98% 164 17.5% 2.67 16.0% 143 139 119 125 115 124 15,763 9
Slide 27: Economic Overview
Economic Overview
Slide 28: Qatar oil and gas wealth per capita is the highest in the world
Qatar oil and gas wealth per capita is the highest in the world Oil and Gas Reserves Per Capita (2015) k barrels of oil equivalent (boe) Qatar 76.9 Kuwait 27.6 UAE 14.4 Venezuela 11.1 Saudi Arabia 10.4 Libya 9.2 Canada 5.2 Iran 4.8 Iraq 4.8 Russia 2.2 Kazakhstan 2.0 • Qatar is endowed with major oil
Slide 29: Infrastructure investment projects have driven diversification and non-hydrocarbon growth
Since 2011, large infrastructure investment projects have driven diversification and strong growth in the non-hydrocarbon sector • Text Qatar’s Diversification Strategy Real GDP Growth by Sector %, year-on-year Hydrocarbon Non-Hydrocarbon Total Government 15.0 Surplus 13.4 10.4 Investment 9.9 9.8 Di
Slide 30: Oil prices have fallen significantly since mid-2014, but recovered during 2016
Oil prices have fallen significantly since mid-2014, but they have recovered during 2016 • Text Brent Crude Oil Price USD per barrel (/b) 140 120 115.1 Comments 100 • In 2014, weak demand growth and increased production from the US and OPEC drove the sharp decline in oil prices 80 • Oil prices fell
Slide 31: We expect average oil prices in the range of USD55-60/b in 2017
We expect average oil prices to be in the range of USD55-60/b in 2017 Brent Crude Oil Price Forecast USD per barrel (/b) 80 Daily historical oil price 70 Comments 58 55 • The current oversupply in oil markets can be 60 45 eliminated in 2017 if agreed production cuts by OPEC are fully adhered to 50 A
Slide 32: Low breakeven oil prices, savings and moderate public debt place Qatar in a strong position
Low breakeven oil prices, accumulated savings and moderate public debt place Qatar in a strong position to withstand low oil prices Accumulated Current Account Fiscal Breakeven Oil Prices Public Debt (% GDP) Surpluses (bn USD, 2005-15) 0 200 400 0 20 40 60 Fiscal Breakeven Oil Price Oil Price 2005 1
Slide 33: Large investment spending on construction and transport will drive the economy
Large investment spending focused on construction and transport will be a key driver of the economy going forward Investment Spending by Sector (2015-18) Major Projects % shares shown Budget Project End (bn USD) Construction 45.5% Lusail Mixed-Use 45.0 2019 truction Cons- Development Transport 29.4%
Slide 34: Population growth and investment spending expected to accelerate real GDP growth
Population growth coupled with investment spending are expected to accelerate real GDP growth Population Growth Real GDP Growth by Sector Population (m) % change %, year-on-year Hydrocarbon Non-Hydrocarbon Total 10.6 10.0 3.0 2.8 9.3 8.2 2.6 2.4 7.9 6.9 7.0 2.2 6.5 7.1 2.0 1.8 6.1 1.7 1.7 4.1 3.8 3.
Slide 35: Disclaimer
Disclaimer By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations: • These materials contain statements about future events and expectations that are forward-looking statements. • These statements typically