Malayan Banking Bhd. · MYX:MAYBANK

Malayan Banking Bhd — Q1 FY2020 Earnings Presentation

48 slides from Malayan Banking Bhd's earnings presentation, May 21, 2020

  1. Slide 1: Investor Presentation: Financial Results 1Q FY2020

    Investor Presentation Financial Results First Quarter FY2020 ended 31 March 2020 21 May 2020 www.maybank.com 0

  2. Slide 2: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 10 Appendix: 1. Financial Performance 21 2. Community Financial Services 32 3. Global Banking 35 4. Maybank Singapore 38 5. Maybank Indonesia 41 6. Other Segments 44 1 Financial Results: 1Q FY2020 ended 31 March 2020

  3. Slide 3: Emphasis on Operational Resilience during COVID-19 pandemic

    Emphasis on Operational Resilience during COVID-19 pandemic • We began progressively rolling out Business Continuity Management (BCM) measures across our footprint and network Group-wide since January 2020, before the COVID-19 outbreak was declared a pandemic. • Our efforts are focused on maintainin

  4. Slide 4: Ensuring ALL stakeholders are supported during COVID-19 pandemic

    Ensuring ALL stakeholders are supported during COVID-19 pandemic Customers Employees Communities Retail/Consumer Non-Retail/Corporate • Launched #Maybank Pledge • RM18 million donated for campaign reiterating staff COVID-19 causes (RM17.5mil by • Repayment moratorium/deferral • Deferment or restruct

  5. Slide 5: Leveraging digital platforms to support transactions during COVID-19 pandemic

    Leveraging digital platforms to support transactions during COVID-19 pandemic New / Enhanced Digital Initiatives • Online application of moratorium and relief programmes (Malaysia & Singapore) • Opening of business accounts via Maybank2u (Malaysia). 37% of all business accounts opened in March’20 we

  6. Slide 6: Continued commitment in supporting customers through the COVID-19 pandemic

    Continued commitment in supporting customers through the COVID-19 pandemic Maybank Group’s Loans Under Moratorium, Relief or R&R Programmes for Three Home Markets Malaysia • Automatic six-month moratorium applied for consumer and SME loan/ % of Outstanding Loan Balance^ as at 8 May financing repayme

  7. Slide 7: Maybank Performance Outlook for FY2020 (1/2)

    Maybank Performance Outlook for FY2020 (1/2) 1 • 1Q FY2020 pre-provisioning operating profit of RM3.78 billion enabled us to absorb additional provisioning on forward looking assumptions based on weakening macro-economic variables (MEVs). • The full effects of rate cuts across key markets will show

  8. Slide 8: Maybank Performance Outlook for FY2020 (2/2)

    Maybank Performance Outlook for FY2020 (2/2) 4 • Stable Group LCR trend at 138.2% as at end-March 2020, well above regulatory requirements. • Net stable funding ratio as at end-Mar 2020 well above minimum requirement of 80% effective 1 July 2020. • Continue to maintain good quality deposits in local

  9. Slide 9: Market Outlook

    Market Outlook 2020 industry outlook for our home markets Key Indicators Outlook • The economy is expected to shrink, reflecting the • GDP: -3.3% (2020F) vs 4.3% (2019) impact of the COVID-19 pandemic, domestic • System loan: 2.0% (2020F) vs 3.9% (2019) Movement Control Order (MCO) and drop in crude

  10. Slide 10: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 10 Appendix: 1. Financial Performance 21 2. Community Financial Services 32 3. Global Banking 35 4. Maybank Singapore 38 5. Maybank Indonesia 41 6. Other Segments 44 9 Financial Results: 1Q FY2020 ended 31 March 2020

  11. Slide 11: Maybank Group 1Q FY2020 Overview

    Maybank Group 1Q FY2020 Overview Net operating income of RM6.72 billion supported by stronger net fee based income 1 • Net operating income grew by 14.7% YoY as net fee based income increased by 53.2% on stronger securities disposal gains and revaluation on derivatives 1Q FY2020 • Contained overhead

  12. Slide 12: P&L Summary: 1Q FY2020

    P&L Summary: 1Q FY2020 PPOP improves 23.9% YoY on higher revenue and contained overheads growth More 1Q 1Q 4Q details on RM million YoY QoQ FY2020 FY2019 FY2019 s.23 Net fund based income * 4,344.5 4,306.9 0.9% 4,518.9 (3.9)% s.14/ 23 Net fee based income * 2,379.7 1,553.1 53.2% 1,974.0 20.5% s.21/

  13. Slide 13: Net Fund Based Income: 1Q FY2020 YoY Trends (1/2)

    Net Fund Based Income: 1Q FY2020 YoY Trends (1/2) Selective Group balance sheet expansion in line with risk and liquidity management Group Malaysia Singapore Indonesia Gross Loans (YoY) Community Financial Services Global Banking  +0.3%  +5.0%  (5.6)%  (8.8)% 299.4 314.3 SGD billion IDR trillion

  14. Slide 14: Net Fund Based Income: 1Q FY2020 (2/2)

    Net Fund Based Income: 1Q FY2020 (2/2) NIM compression on rate cuts in home markets Net Interest Margin (%) QoQ Trend 5 Year Trend 2.32 2.30 2.29 2.23 2.19 1Q '19 2Q '19 3Q '19 4Q '19 1Q '20 2.36 2.33 2.27 2.27 2.23 FY2016 FY2017 FY2018 FY2019 1Q FY2020 13

  15. Slide 15: Net Fee Based Income: 1Q FY2020

    Net Fee Based Income: 1Q FY2020 Improvement driven by stronger realised gains on securities disposal and MTM derivatives revaluation gains 1Q 4Q 1Q RM million QoQ YoY FY2020 FY2019 FY2019 Commission, service charges and fees 820 910  (9.9)% 773  6.0% Investment & trading income 769 207  >100% 206

  16. Slide 16: Overheads: 1Q FY2020

    Overheads: 1Q FY2020 Low cost growth YoY on reduced marketing expenses, with CIR at 43.7% and positive JAWs position of 9.9% 1Q 1Q 4Q RM million YoY QoQ FY2020 FY2019 FY2019 Personnel Costs 1,727.0 1,686.9 2.4% 1,601.5 7.8% Establishment Costs 458.0 441.3 3.8% 534.9 (14.4)% Marketing Expenses 108.7

  17. Slide 17: Asset Quality

    Asset Quality Higher loan loss coverage of 81.5%, despite stable QoQ GIL ratio Allowances for losses on loans Group Gross Impaired Loans (GIL) Ratio Composition Loan loss coverage incl. Regulatory Reserve Mar Dec Sep Jun Mar GIL Ratio Components Loan loss coverage 2020 2019 2019 2019 2019 Allowances

  18. Slide 18: Asset Quality by Line of Business in Home Markets

    Asset Quality by Line of Business in Home Markets Uptick in March reporting for Indonesia mainly from full adoption of IFRS effective 2020 Consumer Mortgage Auto Finance Credit Cards MBI GIL normalised to include IFRS 9 impact. 5.39% 1.33% 1.97% 1.77% 1.88% 4.62% 4.82% 4.65% 4.70% 1.27% 1.66% 1.71%

  19. Slide 19: Exposure to Oil & Gas and Real Estate Sectors: 31 March 2020

    Exposure to Oil & Gas and Real Estate Sectors: 31 March 2020 Stable QoQ exposure size for both sectors Group Exposure to Direct & Indirect Oil & Gas Borrowers Real Estate Exposure to Non-Retail Malaysian Borrowers Maybank Group Malaysia Singapore Indonesia Others 2.73% 1.78% 0.69% 0.07% 0.19% Others

  20. Slide 20: Strong Liquidity & Capital Positions: 31 March 2020

    Strong Liquidity & Capital Positions: 31 March 2020 Stable LCR at 138%, while CET1 capital ratio at 14.79% (post second interim dividend for FY2019) Liquidity Risk Indicators Before proposed After proposed dividend full cash dividend 19.39% 19.67% LDR LTF LTFE LCR 18.50% Group 16.49% 16.73% 15.56% 1

  21. Slide 21: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 10 Appendix: 1. Financial Performance 21 2. Community Financial Services 32 3. Global Banking 35 4. Maybank Singapore 38 5. Maybank Indonesia 41 6. Other Segments 44 20Financial Results: 1Q FY2020 ended 31 March 2020

  22. Slide 22: International & Malaysia Portfolio Mix 1Q FY2020

    International & Malaysia Portfolio Mix 1Q FY2020 Net Operating Income Profit Before Tax¹ Gross loans* 1Q FY2020 (Jan 20 – Mar 20) Overseas: 6.1% Overseas: 8.8% Overseas: 8.4% 31.6% 10.4% 25.3% 10.4% 39.0% 6.5% 6.1% RM2.80 RM518.4 15.1% RM6.72 billion billion 24.1% billion 61.0% 68.4% 74.7% Malaysia

  23. Slide 23: Segmental Performance of Businesses: 1Q FY2020 (1/2)

    Segmental Performance of Businesses: 1Q FY2020 (1/2) Net Operating Income 1Q FY2019 Group Global Banking  +20.8% 1Q FY2020  +14.7% 1Q FY2019: 2,257 1Q FY2020: 2,727 6,724 5,860  +2.2%  +23.1%  +13.7%  (36.0)%  (37.2)% RM million 3,372 3,447 2,401 1,951 262 298 45 478 300 29 Total Group Commun

  24. Slide 24: Segmental Performance of Businesses: 1Q FY2020 (2/2)

    Segmental Performance of Businesses: 1Q FY2020 (2/2) Net Fund Based Income 1Q FY2019 1Q FY2020 Group Global Banking  +4.1%  +0.9% 1Q FY2019: 1,326 1Q FY2020: 1,380 4,307 4,344  +0.9%  4.9%  (8.3)%  (>100)%  +1.0% 2,581 2,603 RM million 1,260 1,321 65 312 315 60 2 (1) Total Group Community Gro

  25. Slide 25: Unaudited Income Statement for Insurance and Takaful Business

    Unaudited Income Statement for Insurance and Takaful Business RM million 1Q FY2020 1Q FY2019 YoY 4Q FY2019 QoQ Net interest income 315.4 312.3 1.0% 324.4 (2.8)% Net earned premiums 1,944.9 1,626.5 19.6% 1,761.2 10.4% Other operating income (794.7) 501.4 (>100)% (46.4) >100% Total operating income 1,

  26. Slide 26: Group Gross Loans Growth: 31 March 2020

    Group Gross Loans Growth: 31 March 2020 % of 31 Mar 31 Dec YTD 31 Mar QoQ YoY Portfolio 2020 2019 Annualised 2019 Group Gross Loans 518.4 523.5  (1.0)%  (3.9)% 516.9  0.3% Malaysia (RM billion) 61% 314.3 314.1  0.1%  0.3% 299.4  5.0% Community Financial Services (reported) 74% 231.7 231.3  0.

  27. Slide 27: Malaysia Loans Growth: 31 March 2020

    Malaysia Loans Growth: 31 March 2020 % of 31 Mar 31 Dec YTD 31 Mar RM billion QoQ YoY Portfolio 2020 2019 Annualised 2019 Community Financial Services (reported) 74% 231.7 231.3  0.2%  0.8% 218.1  6.2% Community Financial Services (rebased)¹ 74% 231.7 231.0  0.3%  1.2% 218.1  6.2% Consumer 60%

  28. Slide 28: Group Deposits Growth: 31 March 2020

    Group Deposits Growth: 31 March 2020 % of 31 Mar 31 Dec YTD 31 Mar QoQ YoY Portfolio 2020 2019 Annualised 2019 Group Gross Deposits 543.8 565.3  (3.8)%  (15.2)% 557.6  (2.5)% Malaysia (RM billion) 62% 336.7 351.5  (4.2)%  (16.8)% 343.9  (2.1)% Savings Deposits 14% 48.8 45.0  8.4%  33.6% 43.9

  29. Slide 29: LDR and CASA Ratio

    LDR and CASA Ratio Group LDR CASA CASA (without IA) Malaysia 93.4% 92.5% 95.2% 93.9% 92.4% 92.4% 87.6% 90.0% 86.9% 87.1% 38.4% 34.5% 34.9% 34.6% 35.5% 43.6% 37.5% 37.5% 37.5% 38.7% 35.1% 32.4% 32.6% 32.5% 33.2% 38.2% 34.0% 33.8% 34.0% 34.9% Mar 19 Jun 19 Sep 19 Dec 19 Mar 20 Mar 19 Jun 19 Sep 19 Dec

  30. Slide 30: RWA Optimisation and Funding Management

    RWA Optimisation and Funding Management Group Gross Loans & Group RWA Funding Breakdown Borrowings and Capital Instruments Operational RWA Market RWA by Currency Credit RWA Gross Loans 523.5 518.4 516.9 380.4 FI Deposits, 7% 374.5 375.3 Equity, 11% IDR, HKD, 7% 42.9 JPY, 8% SGD, 5% 41.8 43.6 13% CNY

  31. Slide 31: Key Operating Ratios

    Key Operating Ratios % 1Q FY2020 1Q FY2019 YoY 4Q FY2019 QoQ Return on Equity 4 10.6 9.7 0.9% 13.0 (2.4)% Net Interest Margin 4 (bps) 2.23 2.30 (7) bps 2.29 (6) bps Fee to Income Ratio 35.4 26.5 8.9% 30.4 5.0% Loans-to-Deposit Ratio 1 95.2 92.4 2.8% 92.4 2.8% Cost to Income Ratio 2 43.7 47.9 (4.2)%

  32. Slide 32: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 10 Appendix: 1. Financial Performance 21 2. Community Financial Services 32 3. Global Banking 35 4. Maybank Singapore 38 5. Maybank Indonesia 41 6. Other Segments 44 31Financial Results: 1Q FY2020 ended 31 March 2020

  33. Slide 33: Community Financial Services: Overview of Market Share for Malaysia

    Community Financial Services: Overview of Market Share for Malaysia Market share Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Loans Total consumer (Household) 17.8% 17.5% 17.6% 17.7% 17.8% Auto (Hire Purchase + Block Discounting + Floor Stocking) 28.7% 28.9% 29.3% 29.6% 29.7% Total mortgage * 13.6% 13.6% 13.7

  34. Slide 34: Community Financial Services: Overview of Malaysia Portfolio

    Community Financial Services: Overview of Malaysia Portfolio Total CFS loans on an upward trend of 6.2% YoY and 0.2% Total CFS deposits increased by 4.0% YoY driven by CASA QoQ. growth of 9.8%  +4.0% YoY  +6.2% YoY  +0.5% QoQ  +0.2% QoQ 218.1 231.3 231.7 197.4 204.3 205.3 41.3 44.4 43.8 RM billi

  35. Slide 35: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 10 Appendix: 1. Financial Performance 21 2. Community Financial Services 32 3. Global Banking 35 4. Maybank Singapore 38 5. Maybank Indonesia 41 6. Other Segments 44 34Financial Results: 1Q FY2020 ended 31 March 2020

  36. Slide 36: Global Banking: Overview of Malaysia Corporate Banking and Group Securities Portfolio

    Global Banking: Overview of Malaysia Corporate Banking and Group Securities Portfolio Total Corporate Banking loans in Malaysia increased 1.5% Group Securities Portfolio¹ grew 1.6% YoY YoY to RM82.4 billion RM billion  +1.6% YoY 48.2 Term Loan 46.7  +8.2%YoY 44.5 202.4 194.9 192.8 189.5 186.5 7.9

  37. Slide 37: Global Banking: Overview of Group Investment Banking Portfolio

    Global Banking: Overview of Group Investment Banking Portfolio 1Q FY2020 Total Income Breakdown by Country 1Q FY2020 Fee-based Income for Malaysia Hong Kong Others Arranger Fees Underwriting & 4% 5% 10% Placement Fees Philippines 1% 1% Indonesia Malaysia Advisory Fees 4% 35% 2% Thailand 17% RM298.0

  38. Slide 38: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 10 Appendix: 1. Financial Performance 21 2. Community Financial Services 32 3. Global Banking 35 4. Maybank Singapore 38 5. Maybank Indonesia 41 6. Other Segments 44 37Financial Results: 1Q FY2020 ended 31 March 2020

  39. Slide 39: Maybank Singapore: P&L Summary

    Maybank Singapore: P&L Summary 1Q 1Q 4Q SGD million YoY QoQ FY2020 FY2019 FY2019 Net fund based income 170.40 193.10 (11.8)% 184.26 (7.5%) Net fee based income 104.40 82.76 26.1% 95.74 9.0% Net income 274.80 275.86 (0.4)% 280.00 (1.9)% Overhead expenses (121.10) (112.60) 7.5% (103.66) 16.8% Operatin

  40. Slide 40: Maybank Singapore: Overview of Loans and Deposits Portfolio

    Maybank Singapore: Overview of Loans and Deposits Portfolio Diversified Loan Portfolio Consumer deposits made up 55% of total deposits % of 31 Mar 31 Dec 31 Mar  +1.1% YoY SGD Billion QoQ YoY Portfolio 2020 2019 2019 46.7 48.3 47.2 Consumer - CFS 55% 21.9 22.1 (1.2)% 22.8 (4.2)% Time Deposits Consu

  41. Slide 41: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 10 Appendix: 1. Financial Performance 21 2. Community Financial Services 32 3. Global Banking 35 4. Maybank Singapore 38 5. Maybank Indonesia 41 6. Other Segments 44 40Financial Results: 1Q FY2020 ended 31 March 2020

  42. Slide 42: Maybank Indonesia: P&L Summary

    Maybank Indonesia: P&L Summary 1Q 1Q 4Q IDR billion YoY QoQ FY2020 FY2019 FY2019 Net Fund Based income 2,024 2,037 (0.6)% 2,043 (0.9)% Net Fee Based income 598 515 16.0% 725 (17.6)% Net income 2,622 2,552 2.7% 2,768 (5.3)% Overhead expenses (1,604) (1,585) 1.2% (1,541) 4.1% Personnel (658) (633) 3.9

  43. Slide 43: Maybank Indonesia: Financial Ratios and Loans Portfolio Breakdown

    Maybank Indonesia: Financial Ratios and Loans Portfolio Breakdown Key Operating Ratios Loans Portfolio Breakdown % of 31 Mar 31 Dec 31 Mar Key Operating Ratio Mar-20 Dec-19 Mar-19 YoY IDR Trillion QoQ YoY Portfolio 2020 2019 2019 Profitability & Efficiency CFS 71% 87.7 90.5 (3.1)% 100.0 (12.3)% Retu

  44. Slide 44: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 10 Appendix: 1. Financial Performance 21 2. Community Financial Services 32 3. Global Banking 35 4. Maybank Singapore 38 5. Maybank Indonesia 41 6. Other Segments 44 43Financial Results: 1Q FY2020 ended 31 March 2020

  45. Slide 45: Islamic Banking: Performance Overview

    Islamic Banking: Performance Overview Group Islamic Banking Financial Performance Maybank Islamic: Total Gross Financing grew to RM193.9 billion RM million 1Q FY2020 1Q FY2019 YoY Mar-19 15% Mar-20 Total Income 1,336.3 1,331.0 0.4% 56.1 5% 48.9 Profit Before Tax 990.1 896.6 10.4% 9% 40.0 42.0 4%

  46. Slide 46: Islamic Banking: Market Share

    Islamic Banking: Market Share Maybank Islamic Market Share Market Share by Product (Malaysia) 31.0% 31.0% 31.2% 31.1% 30.9% Key Products Mar 20 Mar 19 Automobile Financing 48.0% 45.8% 28.7% 28.3% 27.8% 27.8% 27.6% Home 26.8% 26.3% Term financing 28.2% 28.4% Mar 19 Jun 19 Sep 19 Dec 19 Mar 20 Financi

  47. Slide 47: Insurance and Takaful: Performance Overview

    Insurance and Takaful: Performance Overview Net Adjusted Premium/Contribution Life & Family (New Business) Market Share (Malaysia) Single Premium  >100% 21.6% 21.5% 20.3% 19.1% Regular Premium  11.2% No. 4 in 14.1% 13.1% 14.2% 16.7% Life/Family (12.3)% 1Q FY2020  Credit Premium (New Business) 15.

  48. Slide 48: Malayan Banking Berhad contact details and disclaimer

    Humanising Financial Services MALAYAN BANKING BERHAD 14th Floor, Menara Maybank 100, Jalan Tun Perak 50050 Kuala Lumpur, Malaysia Tel : (6)03-2070 8833 www.maybank.com Disclaimer. This presentation has been prepared by Malayan Banking Berhad (the “Company”) for information purposes only and does not

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