First Abu Dhabi Bank · ADX:FAB
First Abu Dhabi Bank — Q1 2023 Earnings Presentation
26 slides from First Abu Dhabi Bank's earnings presentation, Apr 27, 2023
Slide 1: Q1'23 Earnings Presentation
Q1’23 EARNINGS PRESENTATION 27 April 2023
Slide 2: Disclaimer
Disclaimer • Comparative figures have been reclassified where appropriate to conform to the presentation and accounting policies adopted in the consolidated financial statements • Integration of Bank Audi Egypt into FABMisr was completed in Q4’22. FABMisr is grouped under Head Office on an interim b
Slide 3: Q1'23 Key Performance Highlights
Q1’23 Key Performance Highlights Key Financial Highlights ❑ Strong start to 2023 Net profit 3.9 ▲ AED Bn 70% 60% YoY1 QoQ • Group Revenue +51% YoY1 and +14% QoQ driven by sustained momentum across all business segments, enhanced income generation across products and geographies • Q1’23 NPAT at AED 3
Slide 4: Good progress against our strategic priorities in Q1'23
Good progress against our strategic priorities in Q1’23 ✓ Strong deal pipeline execution and commercial momentum across several areas ✓ Strength in fee-based business, enhanced cross-sell, driving further income growth and diversification 1 STIMULATE ✓ Offering innovative solutions to our clients, l
Slide 5: High double-digit earnings growth driven by sustained business activity
High double-digit earnings growth driven by sustained business activity, benefits from higher interest rates, and enhanced income generation across a diversified franchise Q1’23 Summary P&L Net profit bridge YoY (AED Mn) in AED Mn Q1’23 QoQ% YoY%1 +70% YoY1 Excluding Magnati-related capital gains in
Slide 6: Sustained business momentum across business segments and product lines
Sustained business momentum with solid operating performance across business segments and product lines Operating income bridge (AED Mn) Net interest income bridge (AED Mn) Non-interest income bridge (AED Mn) +51% YoY YoY ↑41% YoY ↑74% +787 6,730 +736 +20 +341 4,427 +447 2,303 +672 +35 3,135 +372 +5
Slide 7: Solid balance sheet fundamentals supported by strong liquidity and loan growth
Solid balance sheet fundamentals supported by a strong liquidity position and healthy loan growth Loans (net) increased 3% Ytd (AED 13Bn) driven by sustained demand from our core clients across the corporate Asset Mix - Dec’22 +7%QoQ Asset Mix - Mar’23 & private sectors, and growth in trade finance
Slide 8: Increase in NII driven by growth in business volumes and higher interest rates
Increase in NII driven by growth in business volumes and higher interest rates Net interest income (AED Bn) • Increase in NII by 5% qoq and 41% yoy was driven by growth in Performing loan yields (%) business volumes and margin improvements from effective balance Quarterly YTD QoQ ↑5%, YoY ↑41% sheet
Slide 9: Strength in fee-based businesses drives non-interest income growth
Strength in fee-based businesses, significantly higher FX gains and a healthy sales & trading performance, drive non-interest income growth Fees & commissions, net (AED Mn) Non-interest income Q1’23 Q4’22 QoQ% Q1’22 YoY% Loan-related Trade-related Other (In AED Mn) QoQ ↑15%, YoY ↑1% Non-interest inc
Slide 10: C/I ratio improvement reflects revenue growth and cost discipline
C/I ratio improvement reflects revenue growth and cost discipline amidst continued investments to support business growth Operating expenses trend (AED Mn) and C/I ratio (%) Opex drivers YoY (AED Mn) C/I ratio1 33.2 31.2 33.4 28.7 25.1 +11% YoY QoQ ↓16%, YoY ↑11% +55 1,688 +30 2,000 +88 1,688 1,515
Slide 11: Healthy asset quality metrics with stable NPL ratio
Healthy asset quality metrics with stable NPL ratio, adequate provision buffers Impairment charges, net (AED Mn) & CoR1 (%) NPLs2 and ECLs3 (%) Net impairment charges CoR (L&A) (bps) Provision Coverage (%) NPL Ratio (%) NPLs (AED Bn) Provisions (AED Bn) 86 102 100 103 98 101 60 62 42 52 3.8 3.6 3.9
Slide 12: Strong capital generation and RWA discipline
Strong capital generation and RWA discipline CET11 ratio progression RoRWA4 (%ytd) and RWAs (AED Bn) 2.0 2.8 1.6 1.8 1.7 Cash DPS: 52 fils 595 583 584 572 568 AED 5.75Bn 6% 5% 6% +69bps +9bps -21bps 9% 10% 8% 6% 6% 7% 7% 1.00% • RWA • Adverse 13.0% 13.1% optimisation movement in 13.2% 85% 85% 86% 87
Slide 13: Wrap-up and financial guidance
Wrap-up and financial guidance ▪ Q1’23 performance represents strong start to the year 2023e financial guidance Q1’23 actual ▪ The Group operates on solid balance sheet Loan growth Mid single-digit +3% ytd fundamentals ▪ We delivered good progress against our growth Cost of Risk < 80bps 62bps (CoR)
Slide 14: Appendix
Appendix Q1'23 Earnings Presentation 14
Slide 15: A well-diversified, high quality loan book
A well-diversified, high quality loan book Figures in AED Bn Gross loans trend Gross loans by counterparty QoQ ↑3%, YoY ↑9%, 479.7 494.0 Trade-related 16% 16% 477.9 484.5 479.7 494.0 Personal/ Retail 452.7 Corporate/ Private 52% 52% Banks 1% 3% Public Sector 34.2 30.1 36.4 33.6 43.2 19% 17% Governme
Slide 16: Healthy asset quality and adequate provision buffers
Healthy asset quality and adequate provision buffers NPLs1 by segment NPLs1 by sector (%) (AED Bn) Corporate (IB + CCB) Retail (CB + GPB) 5.3% 5.5% 5.5% 5.3% 5.4% Real Estate & Construction, 45% NPL ratio 3.4% 3.1% 3.0% 3.6% 3.5% Manufacturing, 3% 17.0 16.8 16.3 18.5 18.5 Energy, 5% AED 18.5Bn 24% 2
Slide 17: High-quality and diversified investment portfolio
High-quality and diversified investment portfolio Investments by type Investments by ratings Mar’23 Dec’22 Mar’23 Mar’23 Dec’22 AED 209.2Bn AAA 24% 24% Mar’23 FVTPL - Debt 17% 14% AED 209.2Bn AA 26% 23% Dec’22 FVTPL - Equity & Funds 2% 2% AED 205.7Bn A 25% 26% Amortised Cost (Debt Inv) 2% 2% BBB 7%
Slide 18: Strong deposit inflows in Q1'23 underline franchise strength
Strong deposit inflows in Q1’23 underline franchise strength and superior credit ratings Customer deposits trend Customer deposits by counterparty QoQ ↑11%, YoY ↑30% 700.6 780.5 Total Customer Deposits CASA Certificates of deposits 5% 4% 780.5 14% 13% 745.8 700.6 Personal/retail sector 600.1 648.1 3
Slide 19: Leading issuer in the MENA region
Leading issuer in the MENA region Liability mix Medium-term wholesale funding Customer Term Borrowings & Sub Issuances1 Maturities1 (AED Mn) Deposits, Debt, 6% 73% Others, 9% 18,631 USD AED 1,073.2Bn 17,274 Mar’23 Due to Banks & 16,152 14,498 CNH Repos, 9% 13,268 10,648 11,059 GBP Commercial Paper,
Slide 20: Diversified franchise by business segment and geography
Diversified franchise by business segment and geography Breakdown by Business Breakdown by Geography Investment Banking Corporate & Commercial Banking Consumer Banking Global Private Banking UAE International Head Office3 Operating Income Profit after taxes Operating Income Profit after taxes Q1’23
Slide 21: Business segments overview – IB & CCB
Business segments overview – IB & CCB Investment Banking (IB) Key highlights AED Mn Q1’23 QoQ% YoY% • Outstanding performance across all product lines, with Quarterly operating income trend (AED Bn) Loans & Deposits (AED Bn) Operating Income 2,656 (6) 49 revenue +49% yoy to AED 2.7Bn driven by 33% g
Slide 22: Business segments overview – CB & GPB
Business segments overview – CB & GPB Consumer Banking (CB) Key highlights AED Mn Q1’23 QoQ% YoY% • Customer deposits grew 10% ytd and 21% yoy, led by Quarterly operating income trend (AED Bn) Loans & Deposits (AED Bn) AED 5Bn growth in CASA deposits, buoyed by recent Operating Income 803 (4) (10) L
Slide 23: International – financial overview
International – financial overview International (AED Mn) Q1’23 QoQ% YoY% Key highlights Quarterly operating income trend (AED Bn) Operating Income 1,546 (10) 55 • FAB’s international franchise is a competitive QoQ ↓10%, YoY ↑55% differentiator and a key contributor to Group liquidity Costs (404) (1
Slide 24: Q1'23 financial highlights – Group financials
Q1’23 financial highlights – Group financials Income Statement - Summary (AED Mn) Q1’23 Q4’22 QoQ % Q1’22 YoY % Net interest Income 4,427 4,209 5 3,135 41 Non- interest Income 2,303 1,703 35 1,323 74 Operating Income 6,730 5,911 14 4,458 51 Gain on sale of stake in subsidiary - - na 2,805 na Total I
Slide 25: Q1'23 financial highlights – Segmental
Q1’23 financial highlights – Segmental Q1’23 AED Mn Q1’23 Q4'22 QoQ % Q1’22 YoY % Contr% Operating income 6,730 5,911 14 4,458 51 100% Investment banking (IB) 2,656 2,819 (6) 1,784 49 39% Corporate & Commercial banking (CCB) 1,683 1,516 11 1,012 66 25% Consumer banking (CB) 803 835 (4) 897 (10) 12%
Slide 26: For more information, please visit www.bankfab.com
For more information, please visit www.bankfab.com or contact FAB Investor Relations team at ir@bankfab.com You can also download FAB’s Investor Relations App from App Store /Google Play to access latest corporate updates Scan to download this presentation Click on the image to access latest reports