Rizal Commercial Banking Corporation · PSE:RCB
Rizal Commercial Banking — 9M 2021 Earnings Presentation
37 slides from Rizal Commercial Banking's earnings presentation, 2021
Slide 1: RCBC 9M 2021 Investor Presentation
RCBC 9M 2021 INVESTOR PRESENTATION
Slide 2: Disclaimer
Disclaimer ANY INVESTMENT DECISION TO PURCHASE SECURITIES IN THE CONTEXT OF A PROPOSED OFFERING, IF ANY, SHOULD BE MADE ON THE BASIS OF THE FINAL TERMS AND CONDITIONS OF THE SECURITIES AND THE INFORMATION CONTAINED IN THE OFFERING CIRCULAR PUBLISHED IN RELATION TO SUCH AN OFFERING AND NOT ON THE BAS
Slide 3: Contents
Contents 1 Economic Overview Signs of economic recovery 2 RCBC 9M 2021 Review Sustained core business growth 3 General Information Investment information and ownership 4 Appendix Other financial information 3
Slide 4: Economic Overview
Economic Overview 4
Slide 5: Philippines seen to recover in 2021-22
Philippines seen to recover in 2021-22 3Q 2021 GDP resulted to +7.1% growth, better than market expectations Philippine economy to go back to pre-COVID levels by 2022 (presidential election year); however, further lockdowns could delay this to 2023 2021 FORECAST GDP growth rate But other industries
Slide 6: Data shows improvement from severe GDP numbers in 2020
Data shows improvement from severe GDP numbers in 2020 Philippine GDP growth continued to pick-up from worst levels USD/PhP exchange rate PSEi relatively better compared remained strong to the lows recorded in March 2020 7,331.65 as of Nov „21 50.68 Mar „20 50.17 5,321.23 as of Nov Mar „20 „21 6
Slide 7: The Bank expects recovery in 2022
The Bank expects recovery in 2022 2022 2021 2020 Economic Indicators Forecast Forecast Actual GDP Growth 6.5%-7.0% 4.0%-5.0% (9.5%) USD/PhP (Year-End) 50.00-51.00 49.50-50.50 48.02 USD/PhP (Average) 50.00-51.25 49.25-49.50 49.62 Inflation (Average) 3.3%-3.8% 4.3%-4.5% 2.6% BSP Policy Rate 2.25%-2.50
Slide 8: RCBC's 9M 2021 Review
RCBC’s 9M 2021 Review 8
Slide 9: Business momentum continued to accelerate with strong double-digit growth in loans and deposits
Business momentum continued to accelerate with strong double-digit growth in loans and deposits Key Financial Metrics (As of YTD Sep 2021) 26.0B 5.3B 507B 627B 110B 15.1% Revenues1 Net Income Loans2 Deposits Capital CAR +13% +33% +14% +26% +10% Profitability Growth Resilience Core income expanded dr
Slide 10: RCBC's profit soared 33% in 9M 2021
RCBC’s profit soared 33% in 9M 2021 *Amounts in PhP Millions, except % and ratios [2] Loans and Receivables net of Allowances and Interbank Loans [1] Excluding trading and FX gains 10
Slide 11: Business momentum accelerated driven by core income
Business momentum accelerated driven by core income Healthy return on equity sustained as core Higher volume of loan and treasury assets, coupled with income expanded, tempered by lower trading lower funding costs, propelled net interest income higher and FX gains 8% 7 6.7% 6.5% 6.8% 8% 5.8% 5.5% 21
Slide 12: Stronger balance sheet with growth in risk assets and diversified funding portfolio
Stronger balance sheet with growth in risk assets and diversified funding portfolio Customer Loans Investment Securities 13% 2.9x 513 194 452 457 88 66 3Q 2020 4Q 2020 3Q 2021 3Q 2020 4Q 2020 3Q 2021 Deposits Capital 26% 10% 627 497 536 101 110 99 3Q 2020 4Q 2020 3Q 2021 3Q 2020 4Q 2020 3Q 2021 *Amo
Slide 13: 13% customer loan expansion better than industry
13% customer loan expansion better than industry Corporate and SME segments grew as the Loan growth continued to outperform industry and peers Bank supported working capital requirements and project finance transactions 13% 513 10% 452 29% 3% 3% 30% 4% Sep 2020 Sep 2021 18% Industry2 RCBC 17% 18% SM
Slide 14: 26% deposit jump outpaced industry average
26% deposit jump outpaced industry average Higher CASA and Time deposits supported Solid double-digit growth in deposits better than industry RCBC’s asset build-up strategy and peers 26% 627 17% 10% 9% 497 273 22% Sep 2020 Sep 2021 223 Industry1 RCBC CASA deposits hit record high as the Bank enhance
Slide 15: Diverse and stable fee-based revenue
Diverse and stable fee-based revenue Fee income boosted by investment banking Sources of fees remain diversified, with increasing fees and retail transactions related to share from digital transactions payments and loans 4% 3% 10% 1% 4%3% 9% 8% 42% 44% 14% 10% 4.2 3.6 3.8 3.7 3.4 23% 25% Sep 2021 Se
Slide 16: Uptick in NPLs within expectations
Uptick in NPLs within expectations NPL ratio remained elevated driven by the Recognized additional provision for impairment losses in increase in consumer NPLs 9M 2021 even with the significant build-up of reserves in 2020 30.0 3.8% 4.0% 46% 7.2 3.3% 3.5% 25.0 3.9 2.9% 3.0% 9M 2020 9M 2021 20.0 2.5%
Slide 17: Consolidated key financial indicators
Consolidated key financial indicators Sep 2021 Sep 2020 Change PROFITABILITY Return on Equity 6.8% 6.2% 0.6% Return on Assets 0.9% 0.7% 0.1% Net Interest Margin 4.1% 4.4% (0.3%) COST EFFICIENCY Cost-to-Income Ratio 63.0% 55.8% 7.2% ASSET QUALITY Net NPL Ratio 3.3% 3.8% (0.5%) NPL Coverage Ratio 64.1
Slide 18: Championed Sustainable Finance
Championed Sustainable Finance RCBC is the first Philippine universal bank to issue About 11% (PhP 62B) of the Bank’s loan portfolio is green and sustainable financing instruments under eligible under Sustainable financing. global standards. This remains higher than the 8% coal exposure. USD 1.1B RC
Slide 19: Wide distribution network across the Philippines
Wide distribution network across the Philippines RCBC’s Branch Distribution by Region Sep 2021 CAR I: Ilocos 3 13 5 II: Cagayan Valley Region III: Central 36 IV-A: Calabarzon Luzon NCR: Metro Manila 171 70 6 V: Bicol Region IV-B: Mimaropa Branches and Extension Offices1 434 VIII: VI: 6 Eastern Weste
Slide 20: RCBC Online Retail made even more powerful
RCBC Online Retail made even more powerful RCBC continued to introduce industry-leading digital 124% solutions with the addition of features such as online UITF portfolio management. Increase in mobile banking transaction value 101% QR Payments Wide selection of Billers Growth in InstaPay transactio
Slide 21: Promoted inclusive digital finance
Promoted inclusive digital finance Through Diskartech and ATM Go, the Bank offers vital 48% financial and banking services needed by unbanked and underserved communities. Average monthly growth in Diskartech‟s transaction value 4.6M Financial Inclusion Super App First finance app in Taglish Diskarte
Slide 22: RCBC is the Best Digital Bank
RCBC is the BEST DIGITAL BANK IN THE PH FOR TWO YEARS IN A ROW 2020 Asiamoney 2021 International Business 2021 Business Tabloid, 2021 Alpha Southeast Asia Best Bank Awards Magazine A London-based publication Best Financial Institution Awards 2020 Alpha Southeast Asia 2020 Asiamoney Best Financial In
Slide 23: Also recognized for its strong franchise
ALSO RECOGNIZED FOR ITS STRONG FRANCHISE in Retail Banking, Corporate Banking, SME Banking, and more 23
Slide 24: General Information
General Information 24
Slide 25: Investment Information
Investment Information Equity Profile Dividend History1 Credit Rating Dividends Pay-out Particulars 3Q 2021 Year per share ratio Ticker RCB 2021 0.49 18.51% Long Term Deposit Baa2 Issued shares 2,037.48M 2020 0.56 20.00% Senior Unsecured Baa2 Stock Price 18.50 2019 0.45 17.02% Bank Financial Strengt
Slide 26: Yuchengco Group of Companies
Yuchengco Group of Companies RCBC is a member of the Yuchengco Group of Companies (YGC), one of the premier business conglomerates in the Philippines. The Group is engaged in a wide range of financial and non-financial services. The synergies among these companies allow customers to access a wide ra
Slide 27: Ownership Structure
Ownership Structure Cathay Life Insurance, founded in 1962, is Taiwan‟s largest insurance company. It is owned by Cathay Financial Holding, one of the largest financial holding companies in Taiwan. 22.18% Pan Malayan Management and IFC is the largest global development 5.29% 50.07% Investment Corp.
Slide 28: Comprehensive and Diversified Business Platform
Comprehensive and Diversified Business Platform RCBC RCBC RCBC Capital Rizal Forex Brokers RCBC Leasing International Corporation Micro Bank Corporation Finance1 RCBC Securities RCBC Investment RCBC Rental Corporation Ltd RCBC Bankard Services Corporation [1] RCBC International Finance is the Bank’s
Slide 29: Appendix
Appendix 29
Slide 30: 3Q 2021 net income up 15% from previous quarter
3Q 2021 net income up 15% from previous quarter *Amounts in PhP Millions, except % and ratios [2] Loans and Receivables net of Allowances and Interbank Loans [1] Excluding trading and FX gains; 9% growth including trading and FX gains 30
Slide 31: 3Q 2021 net income up 125% vs same quarter last year
3Q 2021 net income up 125% vs same quarter last year *Amounts in PhP Millions, except % and ratios [2] Loans and Receivables net of Allowances and Interbank Loans [1] Excluding trading and FX gains; 13% growth including trading and FX gains 31
Slide 32: Consolidated Income Statement
Consolidated Income Statement 9M 2021 9M 2020 Change % Change Interest Income 27,379 28,296 (917) (3.2%) Interest Expense 6,215 8,618 (2,403) (27.9%) Net Interest Income 21,164 19,678 1,486 7.5% Other Income 5,555 9,676 (4,122) (42.6%) Trading Gains and Forex 711 6,285 (5,574) (88.7%) Trust Fees 288
Slide 33: Consolidated Balance Sheet
Consolidated Balance Sheet Sep 2021 Sep 2020 Change % Change Cash/Due from BSP & Other Banks 107,949 118,150 (10,201) (8.6%) Investment Securities 194,237 66,132 128,105 193.7% Loans (net of Interbank) 506,709 445,226 61,482 13.8% Other Assets 64,072 101,495 (37,422) (36.9%) TOTAL ASSETS 872,967 731
Slide 34: Historical Consolidated Income Statement
Historical Consolidated Income Statement 2017 2018 2019 2020 9M 2021 Net Interest Income 18.0 20.5 22.4 26.3 21.2 Other Income 7.1 6.0 13.5 11.6 5.6 Gross Income 25.1 26.5 35.9 37.9 26.7 Impairment Losses 2.2 1.9 7.4 9.4 3.9 Income before Operating Expenses 23.0 24.6 28.5 28.5 22.8 Operating Expense
Slide 35: Historical Consolidated Balance Sheet
Historical Consolidated Balance Sheet 2017 2018 2019 2020 Sep 2021 Cash/Due from BSP/Due from Other Banks 93 94 123 148 108 Loans Arising From REPO 10 10 6 13 12 FVPL/FVTCI 13 30 60 45 55 Held to Maturity Investments 60 89 101 43 139 Interbank Loans and Receivables 0 10 19 43 19 Loans (net of Interb
Slide 36: For more information about RCBC, please contact Investor_Relations@rcbc.com
For more information about RCBC, please contact Investor_Relations@rcbc.com 36
Slide 37: RCBC 9M 2021
RCBC 9M 2021 INVESTOR PRESENTATION
Rizal Commercial Banking — 9M 2021 Earnings Presentation on 6ix