Emirates Nbd Bank (p.j.s.c) · DFM:EMIRATESNBD
Emirates Nbd Bank (p.j.s.c) — Emirates NBD — Q3 2013 Earnings Presentation
42 slides from Emirates Nbd Bank (p.j.s.c)'s earnings presentation, December 2013
Slide 1: Emirates NBD Investor Presentation
Emirates NBD Investor Presentation November/December 2013 1
Slide 2: Important Information
Important Information Disclaimer The material in this presentation is general background information about Emirates NBD's activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to
Slide 3: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix 3
Slide 4: UAE Economic Update
UAE Economic Update Highlights Real GDP Growth Forecasts • The UAE’s real GDP growth reached 4.4% in 2012 according to latest data 2013 2014 from the National Bureau of Statistics 2008 2009 2010 2011 2012 F F • The main driver of growth last year was the oil sector, which expanded UAE 3.2% (2.4%) 1.
Slide 5: UAE Economic Update (cont)
UAE Economic Update (cont) Highlights Trends in CDS spreads • Total bank loan growth (net of provisions) reached 6.4% y-o-y in 510 Dubai (lhs) Abu Dhabi (rhs) 160 July; while this is still well below regional peers, the data shows a 150 460 steady improvement, particularly in the retail and personal
Slide 6: Dubai Economic Update
Dubai Economic Update Highlights Dubai: Real GDP growth • Dubai’s real GDP growth was 4% in 2012; the main driver of growth was manufacturing, which expanded 13% y-o-y, and contributed 2% to 6.0% 4.9% the headline growth figure 5.0% 4.0% 4.3% 4.0% 3.2% 3.2% • Dubai’s 2013 GDP growth is forecasted at
Slide 7: Dubai Economic Update (cont)
Dubai Economic Update (cont) Highlights Dubai’s Strategic Location • Dubai is the 3rd largest centre for re-exports in the world which itself represents almost 50% of GDP • Dubai is a strategically located international trading hub with some of the world’s best air and sea ports serving over 205 des
Slide 8: Dubai Economic Update (cont)
Dubai Economic Update (cont) Highlights Dubai Property Prices (in AED) • Dubai property prices continued its upward trend in 2013 1700 Mid range villa Mid range apartment • After dropping an average of 31% in 2009 compared to 1500 Price per sq ft (In AED) 2008 (-36% for villas and -27% for apartment
Slide 9: UAE Banking Market Update
UAE Banking Market Update Highlights UAE Banking Sector Growth (AED billion) • UAE Banking sector is the largest by assets in the GCC; Banking Assets Nominal GDP sector is dominated by 23 local banks which account for 2,500 Loans & Advances Deposits 45% more than 75% of banking assets; 28 foreign ba
Slide 10: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix 10
Slide 11: Summary
Summary • One of the largest financial institutions (by asset size) in the GCC Size • Flagship bank for Dubai Government Flagship • 56% owned by Dubai Government Ownership • Consistently profitable; despite significant headwinds during the global financial crisis Profitable • Fully fledged, diversif
Slide 12: Emirates NBD at a glance
Emirates NBD at a glance A leading bank in UAE Largest Branch Network in the UAE • Market share in UAE (at 30 Sep 2013): Dubai 100 Ras al-Khaimah (3) – Assets c.18%; Loans c.20.3% Abu Dhabi 26 Umm al-Quwain (2) – Deposits c.18.2% Sharjah 14 Fujairah (3) Other 10 Ajman (2) • Retail market shares (est
Slide 13: Emirates NBD is the Largest Bank in the UAE and one of the largest in the GCC by Assets
Emirates NBD is the Largest Bank in the UAE and one of the largest in the GCC by Assets as at 30 Sep 2013 UAE Ranking by Assets (AED UAE Ranking by Shareholder’s UAE Ranking by Profits (AED billion) Equity (AED billion) million) NBAD 345 Emirates NBD 41 NBAD 3,656 Emirates NBD 332 NBAD 33 FGB 3,402
Slide 14: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix 14
Slide 15: Profit and Balance Sheet Growth in Recent Years
Profit and Balance Sheet Growth in Recent Years Revenues and Costs (AED billion) Profits (AED billion) Revenues Costs Pre-Provision Operating Profits Net Profits 3.3 10.8 3.6 3.7 7.1 0.1 9.7 9.9 10.2 3.5 6.6 6.3 6.5 2.5 2.5 8.7 3.1 2.9 1.5 5.7 2.3 0.9 1.0 1.5 0.2 2.6 2.6 2.2 2.5 2.5 +13% 1.0 +7% 1.4
Slide 16: Q3 2013 YTD Financial Results Highlights
Q3 2013 YTD Financial Results Highlights Highlights Key Performance Indicators • YTD Net interest income rose 15% helped Q3 13 Q3 12 Better/ Better/ by increased volumes in higher yielding AED million Q3 13 Q2 13 YTD YTD (Worse) (Worse) retail products, declining EIBOR, cheaper bank borrowings, more
Slide 17: Net Interest Income
Net Interest Income Highlights Net Interest Margin (%) • NIM improved by 35bps to 2.83% in Q3 2013 from 2.48% in 2.96 Qtrly NIM Q2 2013 due to a 17bps increase in loan spreads and an 2.85 2.83 YTD NIM 18bps increase in Treasury spreads 2.69 • Loan spreads improved as retail volumes increased for thi
Slide 18: Non Interest Income
Non Interest Income Highlights Composition of Non Interest Income • Q3 2013 YTD Non interest income increased by 9% from a million AED Q3 13 Q3 12 % Q3 13 Q2 13 % same period last year YTD YTD – Higher core fee income by 8% Core gross fee – Higher property income of AED 272 million relative to 2,485
Slide 19: Operating costs and Efficiency
Operating costs and Efficiency Highlights Cost to Income Ratio Trends • Costs increased by AED 209 million or +8% y-o-y to AED a CI Ratio (YTD) 2,920 million in Q3 2013 YTD resulting from: 41.1 CI Ratio – Increase of AED 217 million in staff costs – AED 120 million in BNPPE acquisition and operating
Slide 20: Credit Quality
Credit Quality Highlights Impaired Loan & Coverage Ratios (%) • The impaired loans ratio increased by 0.2% q-o-q to 14.1% 72.3 69.8 73.0 74.1 76.5 • Net impaired loans increased by AED 1.2 billion mainly due to a 52.7 54.8 47.8 49.4 51.4 AED 1.1.billion increase in impaired loans in the Islamic corp
Slide 21: Credit Quality
Credit Quality Composition of Gross Loan Portfolio Corporate and Retail Lending Portfolio By Type (AED 256 bn) By Econ Sector (AED 256 bn) Corporate & Sovereign Loans Retail Loans (AED 24 bn) Trans Others (AED 195 bn) Retail .& Cont. 4% 3% Trans. & Cont. Overdr 9% com. Manuf. Trade Manuf. Trade com.
Slide 22: Capital Adequacy
Capital Adequacy Highlights Capitalisation • CAR and T1 improved by 0.5% and 0.4% q-o-q to 19.0% 44.5 19.9 20.6 19.7 and 14.9% respectively resulting from: 18.5 19.0 – increase in Tier 1 capital through profit generation 13.8 13.5 14.5 14.9 – Ongoing issuance of Tier 2 private placements 13.2 45.0 4
Slide 23: Funding and Liquidity
Funding and Liquidity Highlights Loan to Deposit (LTD) Ratio (%) • Headline LTD ratio of 102.5% at Q3 2013 • The LTD ratio is being managed within a target range of 107.0 95%-105% 105.1 • Liquid assets* of AED 33.7 billion as at 30 September 2013 102.0 102.5 (11.6% of total liabilities) 99.9 100.6 9
Slide 24: Loan and Deposit Trends
Loan and Deposit Trends Highlights Trend in Gross Loans by Type (AED billion) • Signs of modest pickup in new +2% underwriting across all business segments 250 254 with 8% growth in gross loans from the 235 238 +8% start of 2013 and 2% growth over the 216 205 179 181 189 191 quarter • Consumer lendi
Slide 25: Acquisition of BNP Paribas Egypt
Acquisition of BNP Paribas Egypt Highlights Financial Impact Upon Acquisition (AED million) • On 9 June 2013, Emirates NBD acquired a AED million 95.2% stake in BNP Paribas Egypt Book value of assets 1,128 • Acquisition of the remaining 4.8% shares Fair value adjustments 118 were completed in Septem
Slide 26: Acquisition of BNP Paribas Egypt
Acquisition of BNP Paribas Egypt Business Overview Business Overview Financial Highlights • Full service commercial banking platform: AED million Dec 2011 Dec 2012 – Corporate Banking: focused on large corporate and Net interest income 290 322 MNCs; serves c.3,000 clients Non-interest income 191 143
Slide 27: Associates and Joint Ventures
Associates and Joint Ventures Highlights Composition of Associates and Joint Ventures • De-risking of investment in Union Properties Income Statement (UP) since 2009: Q3 13 Q3 12 AED million % Q3 13 Q2 13 % – During Q3 2013 YTD, ENBD disposed YTD YTD of 32.6% of UP shares in the market National Gene
Slide 28: Divisional Performance
Divisional Performance • Continued focus on re-alignment to ensure Balance Sheet Trends Revenue Trends enhanced future customer service quality and AED billion AED million share of wallet, increased cross-sell of Treasury +6% Wholesale Banking and Investment Banking products and increased -7% 186.8
Slide 29: Divisional Performance (cont)
Divisional Performance (cont) • Total income at AED 332 million in Q3 2013 YTD Revenue Trends Net Revenue Trends Global Markets & Treasury declined from AED 548 million in the same period AED million AED million last year -22% • Net interest income improved in Q3 2013 -22% compared to Q2 2013 due to
Slide 30: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix 30
Slide 31: Emirates NBD has a focused longer-term strategy built on core building blocks
Emirates NBD has a focused longer-term strategy built on 5 core building blocks 1 Deliver an excellent customer experience 3 4 5 Drive core Run an Drive business efficient geographic organization expansion 2 Build a high performing organization 31
Slide 32: 2013 Strategic Priorities
2013 Strategic Priorities 1 • Continuous Group wide Current Service Excellence Program, e.g. end to end process Deliver an excellent optimization to improve turn-around times , etc. customer • Further improvement of convenience and ease of access, e.g. through enhancement of mobile banking offering
Slide 33: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix
Slide 34: Outlook
Outlook • We have revised up the 2013 GDP forecast for the UAE to 4.4%, on the back of higher than expected oil output year-to-date, as well as strong expansion in the non-oil private sector. • We expect GDP to grow by a further 4.1% in 2014 • We retain our 2013 growth forecast of 3.9% for Dubai. Co
Slide 35: Summary
Summary • Pre-impairment operating profit improved 8% q-o-q and 16% year-to date Profitability compared to Q3 2012 YTD • Net profit of AED 2,584m YTD improved 34% compared to Q3 2012 YTD • Continued conservative provisioning with net impairment allowances up 11% Provisions year-to date to AED 3,400
Slide 36: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix
Slide 37: 2013 Awards
2013 Awards • Emirates NBD named UAE’s “Best Foreign Exchange Provider 2013” by Global Finance • Emirates NBD Asset Management named ‘UAE Asset Manager of the Year’ at MENA Fund Manager Awards 2013 • Emirates NBD Securities has been declared as “Winner of NASDAQ Dubai’s Retail Broker of the Month Aw
Slide 38: 2013 Awards (cont)
2013 Awards (cont) • Emirates NBD won bronze award for best sponsorship of Omega Dubai Desert Classic • Emirates NBD wins ‘Best Corporate Card Award’ for two consecutive years at the ‘Smart Card Awards Middle East – 2013’ • Emirates NBD wins Visa LEADER Award as ‘The Best Issuing Institution in MENA
Slide 39: Large Deals Concluded in 2013
Large Deals Concluded in 2013 March 2013 March 2013 June 2013 Apr 2013 USD 37,500,000 and USD 90,000,000 and USD 350,000,000 USD 230,500,000 and EUR 69,000,000 EUR 30,000,000 EUR 115,300,000 CLUB LOAN FACILITY DUAL CURRENCY TERM CLUB LOAN FACILITY SYNDICATED DUAL CURRENCY MURABAHA LOAN FACILITY Mand
Slide 40: Large Deals Concluded in 2013 (cont)
Large Deals Concluded in 2013 (cont) June 2013 June 2013 April 2013 Sep 2013 USD 426,000,000 AND USD 196,000,000 AND USD 300,000,000 EUR 175,500,000DUAL EUR 57,000,000 USD 700,000,000 CURRENCY MULTI SYNDICATED DUAL TERM LOAN FACILITY REVOLVING CREDIT TRANCHE SYNDICATED CURRENCY DUAL FACILITY MURABAH
Slide 41: Large Deals Concluded in 2013 (cont)
Large Deals Concluded in 2013 (cont)
Slide 42: Investor Relations
Investor Relations PO Box 777 Emirates NBD Head Office, 4th Floor Dubai, UAE Tel: +971 4 201 2606 Email: IR@emiratesnbd.com 42