Malayan Banking Bhd. · MYX:MAYBANK

Malayan Banking Bhd — 31st CITIC CLSA Investors' Forum, Hong Kong 2024

42 slides from Malayan Banking Bhd's conference presentation, Sep 9, 2024

  1. Slide 1: Investor Presentation

    Disclaimer: The contents of this document/information remain the intellectual property of Maybank and no part of this is to be reproduced or transmitted in any form or by any means, including electronically, photocopying, recording or in any information storage and retrieval system without the permi

  2. Slide 2: Table of Contents

    Table of Contents Maybank Investment Case Highlights 2 M25+ Corporate Strategy Updates 3–7 Sustainability Update 8 Financial Performance 10 – 18 Appendix: Supporting 1H FY2024 Financial Performance Updates 20 - 35 Malaysia’s Outlook and Growth Drivers 36 - 40

  3. Slide 3: Maybank Investment Case Highlights

    Maybank Investment Case Highlights A Truly Global Leadership Sustainability Leader Leading Superior dividend Regional Bank In Islamic Banking In ASEAN Digital Bank payouts and yields Strong regional footprint 5th Largest Islamic Bank Established white paper Preferred digital bank in Consistent track

  4. Slide 4: M25+: Propelling Us From Good to Great

    M25+: Propelling Us From Good to Great Our Purpose: We are a values-driven platform, powered by a bionic workforce that Humanises Financial Services Group Strategic Thrusts ST1 Intensify Customer-centricity ST2 Accelerate Digitalisation and Technology Modernisation ST3 Strengthen Maybank’s Position

  5. Slide 5: 1H FY2024: M25+ Continues To Make Good Progress Across All Customer Segments

    1H FY2024: M25+ Continues To Make Good Progress Across All Customer Segments Focus Area: Progress (as at Jun’24): • Expand 15.10 12.85 14.35 13.10 12.78 Increase in loans originated via Home2u (YTD homeownership 10.44 >100% Jun’23: RM8.7 bil vs YTD Jun’24: RM20.5 bil) ecosystem through 2.91 11.90 To

  6. Slide 6: 1H FY2024: M25+ Continues To Make Good Progress Across All Sectors in Home Markets

    1H FY2024: M25+ Continues To Make Good Progress Across All Sectors in Home Markets Focus Area: Progress (1H’23 vs 1H’24): SP13 Rise in wealth AUM (x-deposits) from RM62.6 bil to RM71.6 bil driven by an 14% expanded customer base from 1.17 mil to 1.22 mil customers Group Wealth • Powered by wealth ma

  7. Slide 7: 1H FY2024: M25+ Progress Through Agile Ways of Working and Hyper-Personalisation

    1H FY2024: M25+ Continues To Make Good Progress Through Agile Ways of Working Adoption and Hyper-Personalisation Initiatives Focus Area: Progress (2Q’23 vs 2Q’24): SP1 • Set-up focused squad team MY mid-market growth Supercharge with credit, coverage and Growth in total deals pipeline from RM6.6 bil

  8. Slide 8: FY2024: Focused Growth with Strategic Cost Prioritisation and Asset Quality Management

    FY2024: Focused Growth with Strategic Cost Prioritisation and Diligent Asset Quality Management to Meet M25+ Targets Key Areas to Drive Income Growth Our Targets Wealth Management including Group CFS Non-Retail, focusing on Islamic Wealth across home markets Small and Medium Enterprises (SMEs) Finan

  9. Slide 9: Exceeded FY2025 Sustainable Finance Target; Continue Decarbonisation Leadership

    Exceeded FY2025 Sustainable Finance Target; Continue to Demonstrate Leadership in Decarbonisation Journey Regionally Advancing Our Commitments Sustainable Finance 1H’24 Achievement: RM14.76 bil Released transition pathway First Malaysian bank to Launched Financed Emissions FY2024 Target: RM34.2 bil

  10. Slide 10: Table of Contents

    Table of Contents Maybank Investment Case Highlights 2 M25+ Corporate Strategy Updates 3–7 Sustainability Update 8 Financial Performance 10 – 18 Appendix: Supporting 1H FY2024 Financial Performance Updates 20 - 35 Malaysia’s Outlook and Growth Drivers 36 - 40

  11. Slide 11: Strong Financial Performance in 1H FY2024

    Strong Financial Performance in 1H FY2024 Profitability Indicators Liquidity Indicators 2024 Guidance Return 10.9% 9.8% 9.6% 10.8% 11.0% 8.1% 11% Liquidity 141.0% 142.0% 136.4% 145.4% 142.1% 133.5% on equity Coverage Ratio Fee to 32.8% 34.5% Net Stable 107.9% 118.1% 122.0% 114.1% 29.2% 25.0% 22.0% 2

  12. Slide 12: Improving Asset Quality Trends on Strong Loan Loss Coverage; Resilient Capital Positions

    Improving Asset Quality Trends on Strong Loan Loss Coverage; Resilient Capital Positions Asset Quality Indicators Capital Ratios & Dividend Payout Post Dividend (Group level) 131.2% 124.9% 128.7% Loan Loss 106.3% 111.9% 77.3% CET 1 14.58% 14.73% 15.40% 14.78% 15.34% 14.70% Coverage Capital Ratio Loa

  13. Slide 13: Net Fund Based Income Grew to RM9.77 billion; Strong Loans Growth of 10.4%

    Net Fund Based Income Grew to RM9.77 billion from RM9.62 billion; Strong Loans Growth of 10.4% Net Fund Based Income Key Drivers  1.5% YoY  1.9%  2.2% 2Q’24 vs 1Q’24 2Q’24 vs 2Q’23 • Group loans grew 10.4% YoY led by: RM billion 9.62 9.77 o 10.6% in MY 4.83 4.84 4.93 o 12.5% in SG Volume growth o

  14. Slide 14: Higher NOII of RM5.15 billion Driven by Core Fees, Insurance and Trading Income

    Higher NOII of RM5.15 billion driven by Improved Core Fees, Insurance Performance and Investment and Trading Income Non-Interest Income Key Drivers  (11.9)%  (2.9)%  28.4% YoY 2Q’24 vs 1Q’24 2Q’24 vs 2Q’23 • Core fees increased by 16.5% YoY, driven by higher wealth fees, loan-related 5.15 fees, b

  15. Slide 15: Overall Group Insurance & Takaful PBT Rose 69.8%

    Overall Group Insurance & Takaful Profit Before Tax (PBT) Rose 69.8% Group Insurance & Takaful Key Drivers • 1HFY2024 PBT increased by 69.8% YoY, mainly driven by higher underwriting income from improved business growth in both Life and Family Takaful, and General Insurance and General Takaful PBT (

  16. Slide 16: Higher Cost on Personnel, IT and Revenue-Related Expenses

    Higher Cost on Personnel, IT and Revenue-Related Expenses CIR and Costs Key Drivers 46.8% 48.3% 48.9% 47.5% 48.6% • 1H FY2024 cost increase of 12.0% YoY mainly driven by: o 11.2% increase in personnel costs, which includes provisions  5.1%  12.0% YoY for collective agreements (CAs)  (1.7)% 2Q’24

  17. Slide 17: Healthy Liquidity Levels

    Healthy Liquidity Levels Liquidity Indicators Key Drivers LCR LDR NSFR Liquidity Position • Healthy Group liquidity indicators 140.7% 133.5% 127.2% 117.6% 118.4% • Group deposits grew 7.9% YoY led by Group CASA growth of 114.1% 9.8% 94.5% 92.3% 92.6% • By markets: o MY grew 9.2% (CASA: 10.3%) Group

  18. Slide 18: Improving Group GIL ratio; Management Overlay Maintained

    Improving Group GIL ratio; Management Overlay Maintained Loan ECL, NCC, and LLC Gross Impaired Loans (GIL) P&L ECL Jun 2023 Mar 2024 Jun 2024 (RM billion)  (18.5)%  (32.1)%  (7.9)% YoY 2Q’24 vs 1Q’24 2Q’24 vs 2Q’23 % RM billion % RM billion % RM billion Non Performing Loans 1.15% 6.98 1.07% 7.01

  19. Slide 19: Robust Capital Positions

    Robust Capital Positions Capital Ratios Key Drivers After proposed dividend • Capital ratios remain robust with Group CET1 capital ratio at 14.70% and Group total capital ratio at 18.02%, well above regulatory 18.56% 18.02% requirements Group 16.00% 15.33% • Credit RWA growths of 7.5% YoY and 6.1% Y

  20. Slide 20: Table of Contents

    Table of Contents Maybank Investment Case Highlights 2 M25+ Corporate Strategy Updates 3–7 Sustainability Update 8 Financial Performance 10 – 18 Appendix: Supporting 1H FY2024 Financial Performance Updates 20 - 35 Malaysia’s Outlook and Growth Drivers 36 - 40

  21. Slide 21: P&L Summary: 1H FY2024

    P&L Summary: 1H FY2024 1H 1H 2Q 1Q 2Q RM million YoY QoQ YoY FY2024 FY2023 FY2024 FY2024 FY2023 Net fund based income * 9,770.7 9,622.2 1.5% 4,930.9 4,839.8 1.9% 4,825.5 2.2% Non-interest income * 5,150.6 4,011.9 28.4% 2,413.0 2,737.5 (11.9)% 2,484.3 (2.9)% Net operating income 14,921.2 13,634.1 9.4

  22. Slide 22: Segmental Performance of Businesses: 1H FY2024 (1/2)

    Segmental Performance of Businesses: 1H FY2024 (1/2) Net Operating Income Group Global Banking  +12.1% 1H FY2023 1H FY2024  +9.4% 1H FY2023: 4,560 1H FY2024: 5,113 14,921 13,634  +10.2%  +9.0%  +35.8%  (6.4)%  +59.6% 8,063 8,887 RM million 3,944 4,299 564 766 593 947 52 49 Total Group Communi

  23. Slide 23: Segmental Performance of Businesses: 1H FY2024 (2/2)

    Segmental Performance of Businesses: 1H FY2024 (2/2) Net Fund Based Income 1H FY2023 1H FY2024 Group Global Banking  (7.5)% 1H FY2023: 2,697 1H FY2024: 2,494  +1.5%  +7.7% 9,622 9,771  (9.0)%  +14.1%  +1.6%  +2.9% RM million 6,763 6,278 2,526 2,299 168 192 2 2 839 864 Total Group Community Gr

  24. Slide 24: Group Non-Interest Income: 1H FY2024

    Group Non-Interest Income: 1H FY2024 1H 1H 2Q 1Q 2Q NOII (RM million) YoY QoQ YoY FY2024 FY2023 FY2024 FY2024 FY2023 Commission, service charges and fees 2,173 1,866  16.5% 1,087 1,086  0.1% 940  15.7% Commission 784 687  14.1% 399 385  3.8% 346  15.3% Service charges and fees 1,082 906  19.4

  25. Slide 25: International & Malaysia Portfolio Mix 1H FY2024

    International & Malaysia Portfolio Mix 1H FY2024 Net Operating Income Profit Before Tax Group Loans* 0.3% 5.4% 7.1% 1H FY2024 6.1% (Jan 24 – Jun 24) 8.7% 5.4% 25.1% Overseas: RM14.92 Overseas: RM6.89 Overseas: RM668.8 35.4% 20.6% billion 39.7% 27.2% 30.8% billion billion 60.3% 64.6% 69.2% Malaysia S

  26. Slide 26: Group Loans Growth: 30 June 2024

    Group Loans Growth: 30 June 2024 % of 30 Jun 31 Mar 31 Dec 30 Jun QoQ YTD Ann. YoY Portfolio 2024 2024 2023 2023 Group Loans 668.8 657.8  1.7% 640.8  8.8% 605.8  10.4% Malaysia (RM billion) 60% 401.9 393.6  2.1% 387.2  7.6% 363.3  10.6% Community Financial Services 77% 310.6 303.8  2.2% 298.3

  27. Slide 27: Malaysia Loans Growth: 30 June 2024

    Malaysia Loans Growth: 30 June 2024 RM billion % of Portfolio 30 Jun 2024 31 Mar 2024 QoQ 31 Dec 2023 YTD Ann. 30 Jun 2023 YoY Community Financial Services (reported) 77% 310.6 303.8  2.2% 298.3  8.2% 283.5  9.5% Community Financial Services (rebased)¹ 77% 310.6 303.8  2.2% 298.2  8.3% 283.5 

  28. Slide 28: Singapore Loans Growth: 30 June 2024

    Singapore Loans Growth: 30 June 2024 SGD billion % of Portfolio 30 Jun 2024 31 Mar 2024 QoQ 31 Dec 2023 YTD Ann. 30 Jun 2023 YoY Community Financial Services 53% 26.9 25.3  6.0% 25.1  14.4% 24.7  8.8% Consumer 37% 18.9 17.4  8.0% 17.3  18.4% 17.5  7.7% Housing Loan 26% 13.5 12.2  10.0% 12.0 

  29. Slide 29: Indonesia Loans Growth: 30 June 2024

    Indonesia Loans Growth: 30 June 2024 (Based on MBI’s reporting) % of IDR trillion 30 Jun 2024 31 Mar 2024 QoQ 31 Dec 2023 YTD Ann. 30 Jun 2023 YoY Portfolio Community Financial Services 62.9% 77.4 75.9  2.0% 74.3  8.4% 69.4  11.5% CFS Retail 35.7% 43.9 44.0  (0.1)% 43.5  2.1% 41.5  5.9% Auto L

  30. Slide 30: Group Deposits Growth: 30 June 2024

    Group Deposits Growth: 30 June 2024 % of Portfolio 30 Jun 2024 31 Mar 2024 QoQ 31 Dec 2023 YTD Ann. 30 Jun 2023 YoY Group Deposits 706.5 709.0  (0.4)% 696.8  2.8% 654.8  7.9% Total CASA 270.8 265.4  2.0% 257.3  10.4% 246.5  9.8% Total Fixed Deposits 327.7 328.0  (0.1)% 321.0  4.2% 328.2  (0

  31. Slide 31: LDR and CASA Ratio

    LDR and CASA Ratio Malaysia Group LDR CASA CASA (without IA) NSFR LCR 140.7% 137.4% 142.1% 133.5% 127.2% 117.6% 122.0% 116.8% 118.4% 114.1% 91.7% 90.0% 91.1% 89.9% 89.3% 92.3% 93.0% 91.7% 92.6% 94.5% 43.8% 45.4% 44.2% 38.6% 38.1% 42.7% 43.5% 37.7% 36.9% 37.3% 34.2% 35.3% 33.9% 34.7% 38.3% 40.2% 37.5

  32. Slide 32: RWA Optimisation and Funding Management

    RWA Optimisation and Funding Management Group Loans & Group RWA Funding Breakdown Operational RWA Market RWA Credit RWA Gross Loans Borrowings and Capital 668.8 Instruments by Currency 640.8 FI Deposits, 6% 605.8 458.3* Equity, 10% USD, 36% 440.9* 422.6* 52.0 50.3 Repo, 4% IDR, 5% 48.7 25.3 Borrowin

  33. Slide 33: Asset Quality

    Asset Quality Allowances for losses on loans GIL Ratio Composition P&L ECL 2Q 3Q 4Q 1Q 2Q 1H 1H Jun Sep Dec Mar Jun (RM million) FY2023 FY2023 FY2023 FY2024 FY2024 FY2023 FY2024 2023 2023 2023 2024 2024 Stage 1, net (73) (66) 59 72 (9) (160) 63 Non Performing Loans 1.15% 1.06% 1.00% 1.07% 1.01% (NPL

  34. Slide 34: Asset Quality by Line of Business in Home Markets

    Asset Quality by Line of Business in Home Markets Consumer GIL Ratios Mortgage Auto Finance Credit Cards 0.99% 1.02% 0.92% 1.00% 5.41% 5.30% 0.82% 5.05% 4.99% 0.68% 4.84% 0.63% 1.32% 1.32% 0.51% 1.22% 1.09% 1.14% 0.44% 0.47% 0.52% 0.52% 0.58% 0.57% 1.24% 1.20% 0.51% 1.17% 1.02% 1.01% 0.65% 0.56% 0.6

  35. Slide 35: Dividend: 1H FY2024

    Dividend: 1H FY2024 Full cash single-tier interim dividend of 29 sen per share Dividend Policy Min 40% 79.9% 78.5% 78.1% 78.5% 87.8% 91.2% 84.5% 87.5%^ 77.4% Dividend 76.5% 74.9% 74.7% 71.9% 76.3% 77.3% 69.7% Payout Ratio 100% 88% 100% 100% 67% 53% 63% 27% 20% 25% 19% 27% 34% Cash Component of 13% 1

  36. Slide 36: Overall Business and Financial Impact From Basel III Reform

    Overall Business and Financial Impact From Basel III Reform Implementation Approach and Impact: Business Perspective • May have impact on pricing and business product strategies, especially arising • Basel III Reform encompasses changes to credit, market, from output floor requirement, CVA and Marke

  37. Slide 37: 2024: Stable Economic and Loans Growth Across Home Markets

    2024: Stable Economic and Loans Growth Across Home Markets Malaysia Singapore Indonesia 2024 Forecast (f) Previous (f) Current (f) (f) Change 2024 Forecast (f) Previous (f) Current (f) (f) Change 2024 Forecast (f) Previous (f) Current (f) (f) Change GDP 4.7% 5.2%  GDP 2.4% 3.0%  GDP 5.1% 5.1% - Sy

  38. Slide 38: Malaysia: Implementation of Key Government Plans, Strategies and Legislations

    Malaysia: Implementation of Key Government Plans, Strategies and Legislations Targeted fuel subsidy rationalisation (diesel – 10 Jun 2024), “e-invoice” (1 Jun 2024 - Pilot Programme; 1 Aug 2024 - Phase 1; 1 Jan 2025 - Phase 2; 1 July 2025 - Full Implementation) and Government Procurement Act (to be

  39. Slide 39: Malaysia: Positive Investment Growth Momentum and Outlook

    Malaysia: Positive Investment Growth Momentum and Outlook on Realisation of Robust Approved Investment Since 2021 Malaysia: Approved Private Investment (MYRb) Malaysia: Actual Private Investment (MYRb) 400 280 271 2021-2023 Avg MITI Targets MYR302b p.a. 5% Growth 260 252 254 350 246 (USD69b p.a.) 33

  40. Slide 40: Maybank As Malaysia's Largest Financial Services Provider is Primed to Support Investment Pipeline

    Maybank As Malaysia’s Largest Financial Services Provider is Primed to Support The Country’s Strong Investment Pipeline…  2023 was a record year for approved investments at RM329.5 bil (+23% YoY). FDIs accounted for 57% (or RM188.4 bil) and DDIs 43% (or RM141.1 bil).  Continued momentum into 1Q 20

  41. Slide 41: ...And Growth Opportunities Across Key States For Various Projects

    …And Growth Opportunities Across Key States For Various Projects Johor  Johor-Singapore Special Economic Zone (JSSEZ): Iskandar Malaysia and Pengerang regions proposed as the location for the JSSEZ  Johor also proposing an elevated Automated Rapid Transit system for southern Johor / Johor Bahru co

  42. Slide 42: Malayan Banking Berhad

    MALAYAN BANKING BERHAD 14th Floor, Menara Maybank 100, Jalan Tun Perak 50050 Kuala Lumpur, Malaysia Tel : (6)03-2070 8833 www.maybank.com Disclaimer. This presentation has been prepared by Malayan Banking Berhad (the “Company”) for information purposes only and does not purport to contain all the in

Malayan Banking Berhad (Maybank) — 31st CITIC CLSA Investors' Forum, Hong Kong 2024 on 6ix