CIMB Group Holdings Bhd · MYX:CIMB
CIMB Group Holdings Bhd — Merger or Acquisition (June 2008)
31 slides from CIMB Group Holdings Bhd's merger presentation, Jun 22, 2008
Slide 1: Acquisition of BankThai Public Company Limited
ANALYST PRESENTATION ACQUISITION OF BANKTHAI PUBLIC COMPANY LIMITED Dato’ Sri Nazir Razak Group CEO/Managing Director Kuala Lumpur 22 June 2008
Slide 2: Agenda
Agenda The Deal Introducing BankThai Strategic Rationale Transaction Financials Timeline & Approvals Closing Remarks 2
Slide 3: The Deal
The Deal By CIMBGROUP
Slide 4: The Deal
The Deal Acquisition of FIDF’s 42.13% equity interest in BankThai • THB 2.10 per share • Cash consideration of THB5,905 million (RM577 million) • Valued at 2.91x 31 March 2008 book MGO for remaining 57.87% of BankThai Cash consideration of THB8,112 million (RM790 million) Total consideration
Slide 5: Introducing BankThai
Introducing BankThai By CIMBGROUP
Slide 6: BankThai
BankThai omeLloan (2-3 | mw Youlau 1-2-3 Suuauns 1\S6nsasiaop re 84 ow Wuwrinsnu Iuw noounsweiWouu..ASnD, ba) CIMBGROUP
Slide 7: Overview of BankThai
Overview of BankThai Background & Overview Key Financial Information (Group wide) Formed in August 1998, following the consolidation of 14 (Unit: RM mil*) 2006 2007 1Q08 financial institutions1 after the Thai financial crisis in 1997 Total Assets 21,947.0 20,569.7 21,633.3 Number of shares = 6,6
Slide 8: Loans & Assets Composition as at FY07
Loans & Assets Composition as at FY07 Loans (%) LOANS THB mil % 2.4% Corporate 58,420 58.9 23.6% SME 14,504 14.6 Retail 23,246 23.4 Others 3,038 3.1 59.3% Total Loans 99,208 100.0 14.7% Net Loans 88,087 42.8 Interbank & Money 8,742 4.3 Corporate SME Retail Others Market Items Investments 76,957 37.4
Slide 9: Corporate Structure… A Thai Universal Bank
Corporate Structure… A Thai Universal Bank FIDF TPG Consortium Others 42.13% 42.00% 15.87% Consolidated Associates Subsidiaries 100.00% Sathorn Asset Manage non-performing assets of 30.00% Millea Life Insurance Management BankThai (Thailand) Security brokerage and financial advisory - 100.00% 20.00%
Slide 10: Board and Management
Board and Management Management led by President & CEO; Khun Phirasilp Subhapholsiri who has been in the bank since inception Management team made up of senior corporate bankers with experience in international banks TPG came in 2007, started to assert greater influence since April 2007 TPG’
Slide 11: Branch Network
Branch Network North 9 branches Northeast 8 branches Central 41 branches Bangkok 75 branches South 147 branches throughout 13 branches Thailand…76 in Bangkok and greater Bangkok 11
Slide 12: Comparison with Other Banks
Comparison with Other Banks Total Assets, Gross Loans & Deposits (THB mil) 1,800,000 Market share: Total Assets = 1.3%; Gross Loans = 1.6%; Total Deposits = 0.7% 1,600,000 1,400,000 9th LARGEST LOCAL BANK 1,200,000 10th LARGEST BANK 1,000,000 800,000 600,000 400,000 200,000 0 BBL KTB SCB KBANK BAY T
Slide 13: Key Financials
Key Financials Total Assets, Gross Loans & Deposits Non-Performing Loans (“NPL”s), NPL & Coverage Ratio 300,000 49,932 50,000 400.0% 269,838 256,870 Coverage Ratio 250,000 45,000 344.9% 231,868 350.0% 219,470 205,697 196,290 194,447 40,000 200,000 184,516 181,219 300.0% 166,029 THB mil 35,000 138,46
Slide 14: Potential of Existing BankThai
Potential of Existing BankThai Full range of licenses including securities, leasing, life and non-life Universal insurance, fund management, custodian services, etc. Banking Platform Good brand recognition Established and sizable distribution platform Loan business currently concentrated on
Slide 15: Strategic Rationale
Strategic Rationale ba) CIMBGROUP
Slide 16: Final Piece of the “SEA UB Jigsaw”
Final Piece of the “SEA UB Jigsaw” Geographical Corporate & Investment Stock Islamic Commercial Banking Presence Banking Broking Banking Malaysia 9 9 9 9 Singapore 9 (restricted branches) 9 9 9 Indonesia 9 9 9 9 Thailand BankThai 9 9 BankThai “TO BE SOUTH EAST ASIA’S MOST VALUED Myanmar UNIVERSAL BA
Slide 17: A Unique Investment Opportunity…
A Unique Investment Opportunity… Rare chance for foreigner to own up to 100% of a local Thai bank • BankThai deemed a distressed bank • No new banking licenses since the Asian Financial Crisis • Only minority deals on the horizon…limited synergy and upside potential • Current foreign shareholding
Slide 18: Regionalisation of BankThai
Regionalisation of BankThai Full universal banking capabilities to build on… with Access to and share a regional intra-regional synergies universal banking platform Access to and share customer UK China base Hong Kong, Access to and share best Korea practices Bahrain Access to and share new
Slide 19: Potential Synergies from Integration
Potential Synergies from Integration Potential Transformation Initiatives by CIMB Group New Products HR paradigm shift Credit cards Facilitate cross- Islamic Banking border skills Structured Products transfer through New/ HR and Microfinancing Enhanced staff exchange / Talent Business mode
Slide 20: Transaction Financials
Transaction Financials By CIMBGROUP
Slide 21: Acquisition Cost – Scenarios
Acquisition Cost – 2 Scenarios Offer Price at THB 2.10 per share LEVEL OF ACCEPTANCE – GO 58.00% 100.00% Blended P/B Total consideration – Acquisition & GO (THB mil) 8,130 14,017 2.91x Recapitalisation (THB mil)1 3,074 5,300 Total Consideration after Recapitalisation (THB mil) 11,204 19,317 1.91x To
Slide 22: Capital Management Implications
Capital Management Implications The acquisition would be made under CIMB Bank CIMB Bank’s RWCR will be maintained at 12% At an acquisition of up to 58% stake, there are sufficient surplus funds within CIMBG to fund the acquisition For an acquisition of 100% stake, additional funds will be ra
Slide 23: Preliminary Forecasts
Preliminary Forecasts Worst Case Base Case Management Case1 THB mil 31/03/08 31/12/08 31/12/09 31/12/10 31/12/08 31/12/09 31/12/10 31/12/08 31/12/09 31/12/10 Balance Sheet Total Loans 86,899 97,747 111,731 129,573 98,163 112,007 129,640 105,000 131,000 162,000 Total Assets 216,333 210,724 218,440 23
Slide 24: Earnings Accretive to BCHB from 2009
Earnings Accretive to BCHB from 2009 LEVEL OF ACCEPTANCE – GO (%) 58% 100% THB mil 2008 2009 2010 2011 2012 2008 2009 2010 2011 2012 Expected earnings1 (1,936) 398 1,245 1,617 2,055 (3,338) 686 2,147 2,789 3,544 Cost of Funding (98) (392) (392) (392) (392) (261) (1,044) (1,044) (1,044) (1,044) Net e
Slide 25: Timeline & Approvals
Timeline & Approvals By CIMBGROUP
Slide 26: Timeline & Approvals Required
Timeline & Approvals Required Timeline 2008 June July August September October November December 20 June 2008 Completion of Closing of Signing of Share Acquisition & GO Period Purchase Launch of MGO Agreement Business planning process: • Recapitalisation of BankThai Rights • Quick wins and fixes Iss
Slide 27: Closing Remarks
Closing Remarks By CIMBGROUP
Slide 28: Final Remarks
Final Remarks Thailand is key missing link in our regionalisation strategy Enhances CIMB Group’s regional universal banking platform and franchise value A rare opportunity to acquire a controlling stake in a Thai Bank with full suite of universal banking capabilities at a fair price Value cr
Slide 29: Appendix
Appendix By CIMBGROUP
Slide 30: Substantial Clean Up Post TPG Entry…
Substantial Clean Up Post TPG Entry… THB mil 31 Dec 2006 31 Dec 2007 31 Mar 2008 Total assets 219,470 205,697 216,333 Total liabilities 215,186 204,986 211,458 Total Equity 4,284 711 4,875 TPG entered BankThai in April 2007 • Subscription price of THB4.17 per share for initial 32.9% stake • Subseq
Slide 31: Thank You
THANK YOU bs) CIMBGROUP
CIMB Group Holdings Berhad — Merger or Acquisition (June 2008) on 6ix