First Abu Dhabi Bank · ADX:FAB

First Abu Dhabi Bank — Merger or Acquisition (November 2016)

32 slides from First Abu Dhabi Bank's merger presentation, November 2016

  1. Slide 1: Creating a UAE Champion and the region's International Bank

    Creating a UAE Champion and the region’s International Bank - A transformational merger of equals - November 2016

  2. Slide 2: Disclaimer

    Disclaimer This presentation has been prepared solely for use at the presentation to investors (the Investors) made on 3 July 2016. By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations. This presentation i

  3. Slide 3: Agenda

    Agenda Page 1 Key transaction highlights 2 2 Compelling strategic rationale 5 3 Integration 16 4 Corporate governance and leadership 18 5 Financial highlights and key next steps 20 6 Merger update 25 2

  4. Slide 4: Overview of the transaction and key terms

    Overview of the transaction and key terms  Exchange ratio of 1.254 NBAD shares for every one FGB share Exchange  NBAD will issue total of 5,643 million new shares to FGB shareholders ratio  Exchange ratio implies a discount to FGB's shareholders of 3.9% vs. previous trading day1 and 12.2% vs. 3 m

  5. Slide 5: Transaction structure

    Transaction structure Merger process Post merger structure FGB NBAD shareholders shareholders shareholders shareholders 52.0% 48.0% FGB assets and liabilities vest in NBAD Combined entity (NBAD) Post-merger shareholding structure Transaction structure will be a statutory Free float 63.1% ADIC merger

  6. Slide 6: Agenda

    Agenda Page 1 Key transaction highlights 2 2 Compelling strategic rationale 5 3 Integration 16 4 Corporate governance and leadership 18 5 Financial highlights and key next steps 20 6 Merger update 25 5

  7. Slide 7: Compelling strategic rationale

    Compelling strategic rationale …to benefit all Transformational transaction – a merger of equals… stakeholders Creates No. 1 bank in the UAE, internationally connected for A its target clients Customers Combination of the best in class consumer and wholesale B businesses and strong growth potential

  8. Slide 8: Clear leader in the region

    A Clear leader in the region Banking sector assets (US$bn) National champion(1) Total assets (US$bn) Equity (US$bn) Market cap (US$bn)(2) 175 #1 24.5 #1 29.1 #2 674 UAE 113 13.6 12.6 589 15.3 121 21.3 KSA 308 151 16.3 32.3 Qatar 190 35 3.7 4.4 Bahrain 188 82 9.5 11.1 Kuwait 80 33 3.7 2.5 Oman Source

  9. Slide 9: International network in key growth markets

    A International network in key growth markets Unique business Positioned in key financial markets: …through offices and model to drive UAE's Hong Kong, Singapore, Geneva, branches in 19 countries international ambitions London, Washington D.C…  Wholesale banking and wealth management are primary dr

  10. Slide 10: Strongly positioned vs. international peer group

    A Strongly positioned vs. international peer group Market cap (US$bn)(1) Cost / income ratio RoAE DBS 30 FGB + NBAD 30% #1 Standard 16% Bank FGB + NBAD 29 #2 Maybank 46% 14% #2 Standard 25 DBS 46% Maybank 11% Chartered Maybank 20 CIMB 59% DBS 11% Standard Standard (2) 14 59% CIMB 8% Bank Bank Standa

  11. Slide 11: Best UAE consumer business

    B Best UAE consumer business Ranking vs. UAE peers Our value proposition will be Consumer loans, AEDbn significantly enhanced 96 #1  Significant and scalable market positions across 59 #1 the UAE stimulating growth ENBD 57 #2  Scale enables best in class technological investment to: ADIB 47 #3 ‒ D

  12. Slide 12: Positioned to capture the significant and growing Wealth opportunity

    Positioned to capture the significant and growing Wealth B opportunity Sizable and growing wealth in the region and beyond Strong foundations in place Outstanding business opportunities Strong penetration in Arab world Access new high growth HNWI segments e.g. Significant existing AUM and network no

  13. Slide 13: Leading wholesale business – Global connectivity for regional clients

    Leading wholesale business – Global connectivity for B regional clients Customer focused business around UAE-linked global clients #1 Deep relationships League Tables Our Core Clients Region's No. 1 UAE Bonds wholesale bank with Loans international reach Systems & Platform Sukuk Combining "best of b

  14. Slide 14: Fit for the changing regulatory landscape

    C Fit for the changing regulatory landscape Combined bank better positioned than peers to meet increasing regulatory demands  Sound capital position from the outset, with diversified business mix and funding profile  Scale enables adequate investment in compliance and controls  Enhanced profitabi

  15. Slide 15: Shareholder value creation through synergies

    D Shareholder value creation through synergies Substantial cost saving opportunities - benefit of around AED500m per year  Consolidating common business / enablement functions  Systems integration Cost benefit represents  Premises reduction 8% of combined  Closure of overlapping branches cost ba

  16. Slide 16: Leveraging capital and liquidity to pursue growth

    E Leveraging capital and liquidity to pursue growth Larger capital base and underwriting capacity Strong and diverse liquidity and underwriting capacity Capital base effectively doubles CET1 capital(1) (AEDbn) 63(2) 1% 30% 35 28 LDR: 94% AED545bn 69% FGB NBAD FGB + NBAD Wholesale Customer deposits O

  17. Slide 17: Agenda

    Agenda Page 1 Key transaction highlights 2 2 Compelling strategic rationale 5 3 Integration 16 4 Corporate governance and leadership 18 5 Financial highlights and key next steps 20 6 Merger update 25 16

  18. Slide 18: Key steps of integration

    Key steps of integration Phase Actions Timing  Merger committee to appoint specialised team and drive integration  Design end-to-end management process including full integration plan Pre-Closing  Agree on three year business plan, one year budget and confirm how synergies are delivered Up to 9 P

  19. Slide 19: Agenda

    Agenda Page 1 Key transaction highlights 2 2 Compelling strategic rationale 5 3 Integration 16 4 Corporate governance and leadership 18 5 Financial highlights and key next steps 20 6 Merger update 25 18

  20. Slide 20: Best in class strategic direction, oversight and governance

    Best in class strategic direction, oversight and governance H.H. Sheikh Tahnoon Bin Zayed Al Nahyan Chairman of the Board Board of Directors Sheikh Sheikh H.E. H.E. Mr. Mohamed Mr. Jassim H.E. Nasser Mr. Khalifa Mohammed Ahmed Mohammed Khaldoon Saif Al Mohammed Ahmed Sultan Al Bin Saif Bin Mohammed

  21. Slide 21: Agenda

    Agenda Page 1 Key transaction highlights 2 2 Compelling strategic rationale 5 3 Integration 16 4 Corporate governance and leadership 18 5 Financial highlights and key next steps 20 6 Merger update 25 20

  22. Slide 22: Improved key financial metrics

    Improved key financial metrics Tier 1 ratio 16.9% 15.1% 15.7% Capital Total capital ratio 18.2% 16.0% 16.9% Net loans / deposits ratio 108.3% 85.5% 94.0% Funding LCR 71.3% 100.6% 93.1% Profitability NIM 3.0% 1.9% 2.3% Cost / Income 20.1% 38.7% 30.0% RoAE 20.7% 14.9% 14.1% Total assets (AEDbn) 227 40

  23. Slide 23: Well balanced business profile

    Well balanced business profile Gross loans mix by counterparty Funding composition 7% 1% 22% 30% 45% AED364bn AED545bn 26% 69% Government Consumer Corporate Financial institutions Wholesale Customer deposits Other liabilities Deposit mix by geography Operating income by customer type(1) 15% 23% 5% 4

  24. Slide 24: Indicative timeline

    Indicative timeline Indicative Timetable Q3 2016  NBAD / FGB General Assembly Meeting 2016 Q3 2016  Filing of Special Resolutions Q3 2016  Creditor objection period 2017 Q1 2017  Expected effective merger date 23

  25. Slide 25: Transformational merger of equals

    Transformational merger of equals  Sophisticated wholesale business  Full service bank with with strong product leading consumer and industry expertise franchise  Underpinned by long-  Profitable, efficient and term strategic relations capital generative  Strong conservative  Strong entreprene

  26. Slide 26: Agenda

    Agenda Page 1 Key transaction highlights 2 2 Compelling strategic rationale 5 3 Integration 16 4 Corporate governance and leadership 18 5 Financial highlights and key next steps 20 6 Merger update 25 25

  27. Slide 27: Pre-Merger Timeline

    Pre-Merger Timeline 3rd July Effective Date of Merger FGB-NBAD merger announcement Q3'16 Oct'16 Nov – Dec'16 Q1'17 Creditor objection period Zulfiqar Ali Appointment of Senior Sulaiman, currently Leadership team COO of FGB, appointed as Chief Integration officer Dec 7th: General Assembly Meetings Ap

  28. Slide 28: Integration Governance Structure

    Integration Governance Structure MAIN RESPONSIBILITIES  Oversee Integration success INTEGRATION STEERING  Ensure realization of synergies and growth COMMITTEE (ISC)  Drive critical decisions related to the merger  Rigorously track and monitor Integration CHIEF INTEGRATION OFFICER (CIO) process 

  29. Slide 29: Clear leader in the region

    Clear leader in the region Banking sector assets (US$bn) National champion(1) Total assets (US$bn) Equity (US$bn) Market cap (US$bn)(2) 178 #2 25.1 #1 27.3 #2 694 UAE 121 14.5 11.8 600 14.1 117 22.5 KSA 328 196 17.8 35.3 Qatar 200 82 9.6 11.3 Kuwait 191 34 3.8 4.3 Bahrain 75 28 3.9 2.6 Oman Source:

  30. Slide 30: Well balanced business profile

    Well balanced business profile Gross loans mix by counterparty Funding composition 7% 3% 22% 29% 44% AED374bn AED563bn 27% 68% Government Consumer Corporate Financial institutions Wholesale Customer deposits Other liabilities Deposit mix by geography Operating income by customer type(1) 14% 25% 5% 4

  31. Slide 31: Income statement

    Q3 2016 update on key pro-forma financials Net interest income (AEDmn) 4,220 5,107 9,327 Income statement Total revenue (AEDmn) 7,182 8,094 15,275 Operating expenses (AEDmn) 1,428 3,017 4,445 Net profit (AEDmn) 4,536 3,967 8,503 Cost to income ratio 19.9% 37.3% 29.1% RoTE1 19.0% 13.8% 16.1% Total as

  32. Slide 32: Contact details

    Contact details Sofia El Boury Michael Miller Head of Investor Relations Head of Investor, Media and Public Relations +971 (0) 50 836 6031 +971 (0) 50 619 7116 sofia.elboury@fgb.ae michael.miller@nbad.com Further information: www.bankfortheUAE.com 31

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