I&m Group Plc · NSEKE:IMH
I&m — H1 2022 Earnings Presentation
40 slides from I&m's earnings presentation, Sep 1, 2022
Slide 1: HY 2022 Results Investor Presentation
HY 2022 RESULTS INVESTOR PRESENTATION OUR BRAND PROMISE We Are On Your Side Our Core Values INTEGRITY TRUST RESPECT INNOVATION COURAGE Classification: Public
Slide 2: Group footprint across Kenya, Rwanda, Tanzania, Mauritius, Uganda
KENYA RWANDA TANZANIA MAURITIUS UGANDA I&M Bank Ltd I&M Bank (Rwanda) PLC I&M Bank (T) Ltd Bank One Limited I&M Bank (Uganda) Ltd ✓ 227,000+ customers ✓ 70,700+ customers ✓ 24,600+ customers ✓ 30,700+ customers ✓ 42,000+ Customers ✓ 39 Branches ✓ 18 Branches ✓ 8 Branches ✓ 7 Branches ✓ 11 Branches ✓
Slide 3: June 2022 Key Highlights
June 2022 Key Highlights ✓ Launch of Mastercard offering and the new Customer Value Proposition (CVP) driving our digital business. ✓ 75% of the Groups transactions were executed through digital channels with 68% digitally active customers. ✓ 21% YoY growth in operating income driven by positive per
Slide 4: Group Strategy iMara 2.0 Update
c We Are On Your Side Group Strategy iMara 2.0 Update 4 Classification: Public
Slide 5: iMara 2.0 three-year strategy: pillars and initiatives
iMara 2.0 We are in year 2 of the Group’s 3-year strategy Aspiration Eastern Africa’s Leading Financial Partner for Growth 1. Driving Business Growth 2. Building a Resilient Organisation 3. Optimising the operating model Strategic Pillars And initiatives Customer Experience Cultural Transformation S
Slide 6: iMara 2.0 aspiration and key focus areas
iMara 2.0 Our 3-year strategic aspiration & key focus areas are in motion… Aspiration Target Key Focus Areas Customer Base Growth Ecosystem Banking +21% Segment Expansion Return On Equity MSME and Retail Business Omni Channel Implementation (‘On the Go’) +20Bn Leading to full digital distribution ca
Slide 7: Regional Expansion: contribution from regional banking subsidiaries
Regional Expansion 19% Contribution from regional banking subsidiaries Pillar 1: Driving Business Growth (5%) PBT Total Assets (3%) 3% (7%) 2% 5% (6%) (7%) 4% 7% (10%) 10% (12%) 13% KES KES 7.2Bn 440Bn (74%) 77% 73% (74%) KENYA RWANDA UGANDA TANZANIA MAURITIUS KENYA RWANDA TANZANIA UGANDA Balance: N
Slide 8: Revenue Diversification: steady growth in all income lines
Revenue Diversification Steady growth in all our income lines Pillar 1: Driving Business Growth Operating Income (KES Bn) 5,058 • Newly launched initiatives are showing a 3,944 4,213 strong start with ~KES 1Bn in revenues. 10,521 8,866 6,919 • KES 706Mn revenue generated from digital business transa
Slide 9: Creating value for stakeholders through digital channels
Creating value for our stakeholders through digital channels Pillar 1: Driving Business Growth 75% Branch vs digital channels transactions of I&M Group’s transactions were (26%) executed digitally as at June 2022 25% Branch Digital Channels Value of Digital Transactions in KES Mn (74%) 75% % Digital
Slide 10: Extending retail lending through digital platforms
Extending retail lending through our digital platforms Pillar 1: Driving Business Growth Unsecured Personal loans – KES Mn Unsecured Mobile Loans - TZS Mn 1,028 1,994 79% 135% 575 409% 850 92% 442 113 Dec-21 Mar-22 Jun-22 Dec-21 Mar-22 Jun-22 Launched in October 2021 Launched in September 2021 Offer
Slide 11: Growth in offering to small enterprises in Kenya and Rwanda
Revenue Diversification Growth trajectory in offering to small enterprises in Kenya and Rwanda Pillar 1: Driving Business Growth No of Small Enterprise Customers - Kenya Initiatives in Kenya: 8,786 • Launch of supply chain financing with current loan 8,012 uptake at ~KES 73M (average ticket size of
Slide 12: Consistent growth in performance metrics
Revenue Diversification Consistent growth in our performance metrics Pillar 1: Driving Business Growth Operating Income (KES Bn) Total Loans and Advances Total Deposits (KES Bn) (KES Bn) 313 15.6 231 204 277 12.8 252 +22% 184 +13% +13% 11.1 +11% +10% +15% Jun-20 Jun-21 Jun-22 Jun-20 Jun-21 Jun-22 Ju
Slide 13: Growth in CASA driving down cost of funds
Growth in CASA steadily driving down cost of funds and improving liquidity Pillar 2: Building a Resilient Organisation Customer Deposit Mix Customer Deposits by Segments 22% Increase in CASA Personal 9% 70% 63% 60% driven by Business (12%) Premium relaunched CVPs 15% (14%) 41% (45%) & digital channe
Slide 14: Strong liquidity and capital positions across subsidiaries
The Group maintains strong liquidity and capital positions across all subsidiaries Pillar 2: Building a Resilient Organisation Liquidity Ratio Capital Adequacy Ratios 56.0% 20.6% 19.3% 19.2% 44.4% 17.8% 40.3% 39.3% 16.1% 30.5% 14.5% 14.5% 14.5% 15.0% 12.5% 20.0% 20.0% 20.0% 20.0% 20.0% Kenya Tanzani
Slide 15: Well diversified loans and advances portfolio
Well diversified loans and advances portfolio….. Pillar 2: Building a Resilient Organisation Loans & Advances by Segment Sectoral Distribution of Loans & Advances 1% Mining and Quarrying 1% Personal Premium 6% 1% 5% Energy and Water 1% 4% Financial Services 3% 5% Business Agriculture 4% 20% 5% Touri
Slide 16: Improved asset quality, supported by strong deposit base
…Leading to improved asset quality, supported by strong deposit base Pillar 2: Building a Resilient Organisation Loan to Deposit Ratio Cost of Risk 74% 74% 1.2% 1.1% Jun-21 Jun-22 Jun-21 Jun-22 Coverage Ratio Net NPA 3.7% 63% 2.3% 59% Jun-21 Jun-22 Jun-21 Jun-22 Classification: Public
Slide 17: Group Synergies drive up revenues while keeping costs steady
…Group Synergies drive up revenues while keeping costs steady Pillar 2: Optimising the Operating Model Cross border business development initiative Cost to Income Ratio 48% 47% 45% $1.6M (KES 192M) Jun-20 Jun-21 Jun-22 Revenue earned through cross border business development initiatives Savings from
Slide 18: Group Financial Highlights
c We Are On Your Side Group Financial Highlights 18 Classification: Public
Slide 19: June 2022: business showing strong growth momentum
June 2022 Our Business showing strong growth momentum Profit Before Tax (KES) Net Interest Income (KES) Digitally Active Customers 7,181m 10,529m 68% +22% +19% Net Loans & Advances (KES) Customer Deposits (KES) Transactions from Digital Channels 231bn 313bn 75% +13% +13% Cost/Income Ratio Return on
Slide 20: Subsidiary Performance Highlights
c We Are On Your Side Subsidiary Performance Highlights 20 Classification: Public
Slide 21: Kenya Economic Review
Kenya Economic Review Kenya GDP Growth (%) Macro-economic Outlook 7.2% ▪ GDP expected to slowdown to 5.5% in 2022 and 5.2% in 2023; 5.5% 5.20% 5.0% ▪ Economic performance was strong in Q1 2022 at 6.8%, however external shocks are starting to impact the economy; ▪ Inflation remains a key concern glob
Slide 22: Kenya: growth trajectory in line with strategic initiatives (P&L)
Kenya Growth trajectory in line with strategic initiatives P&L (KES Mn) Operating Income Loan loss Provision Profit Before Tax 1,273 1,250 5,525 11,045 +14% -2% 4,340 +27% 9,720 Jun-21 Jun-22 Jun-21 Jun-22 Jun-21 Jun-22 ✓ Increase in profitability driven by income growth and cost containment – cost
Slide 23: Kenya: growth trajectory (balance sheet)
Kenya Growth trajectory in line with strategic initiatives Balance Sheet (KES Mn) Net Loans & Advances Customer Deposits Total Assets 176,094 319,449 234,348 +13% +12% +10% 282,176 157,299 212,554 Jun-21 Jun-22 Jun-21 Jun-22 Jun-21 Jun-22 ✓ Growth in total assets supported by both increase in Loan a
Slide 24: Tanzania Economic Review
Tanzania Economic Review Tanzania GDP Growth (%) Macro-economic Outlook 7.0% ▪ GDP growth is predicted to increase by 4.5%-5.5% in 2022 and average of 6% over the 4.9% 5.2% medium term on the back of recovering exports and domestic demand. 4.8% 4.8% ▪ Inflation rate increased to 4.4% in June 2022 (f
Slide 25: Tanzania: consistent performance amidst cautious optimism (P&L)
Tanzania Consistent performance amidst cautious optimism P&L (KES Mn) Operating Income Loan Loss Provisions Profit Before Tax 928 +24% +427% 70 0% 168 749 167 13 Jun-21 Jun-22 Jun-21 Jun-22 Jun-21 Jun-22 Key Ratios Jun-21 Jun-22 ✓ Operating income growth supported by increased lending and Government
Slide 26: Tanzania: consistent performance (balance sheet)
Tanzania Consistent performance amidst cautious optimism Balance Sheet (KES Mn) Total Assets Net Loans & Advances Customer Deposits 23,344 30,988 +18% +17% 19,583 +25% 18,689 26,226 16,667 Jun-21 Jun-22 Jun-21 Jun-22 Jun-21 Jun-22 ✓ Asset growth supported by both the lending book and investment port
Slide 27: Rwanda Economic Review
Rwanda Economic Review Macro-economic Outlook Rwanda GDP Growth (%) 10.2% ▪ GDP growth is predicted to increase by 6% in 2022, impacted by global events and an 9.5% average around 6% over the medium term on the back of recovering exports and 7.40% 6.4% domestic demand. ▪ Inflation rate increased to
Slide 28: Rwanda: strong performance supported by business growth (P&L)
Rwanda Strong performance supported by consistent business growth P&L (KES Mn) Operating Income Loan Loss Provisions Profit Before Tax 2,200 198 730 +24% +37% +29% 1,772 145 564 Jun-21 Jun-22 Jun-21 Jun-22 Jun-21 Jun-22 ✓ Growth in operating income supported by significant growth in the MSME portfol
Slide 29: Rwanda: strong performance (balance sheet)
Rwanda Strong performance supported by consistent business growth Balance Sheet (KES Mn) Total Assets Customer Deposits Net Loans & Advances 27,333 34,610 +24% 57,225 +21% +27% 22,560 46,092 27,249 Jun-21 Jun-22 Jun-21 Jun-22 Jun-21 Jun-22 ✓ Asset growth primarily driven by growth in the loan book a
Slide 30: Uganda Economic Review
Uganda Economic Review Uganda GDP Growth (%) Macro-economic Outlook 7.7% • The economy is projected to grow in the range of 2.5% to 3% in 2022, and between 5.1% 5.0% -6.0% in 2023 partly reflecting the effects of higher costs of production 3.4% 3.7% • GDP grew by 4.3% y/y in the 1H22, buoyed by the
Slide 31: Uganda: continued focus on integration (P&L)
Uganda Continued focus on integration to gear business for growth opportunities P&L (KES Mn) Operating Income (Provisions)/ Recoveries Profit Before Tax 217 286 931 -11% +194% +492% 832 (232) (73) Jun-21 Jun-22 Jun-21 Jun-22 Jun-21 Jun-22 ✓ I&M Uganda became part of the Group from Q2 2021. Key Ratio
Slide 32: Uganda: continued focus on integration (balance sheet)
Uganda Continued focus on integration to gear business for growth opportunities Balance Sheet (KES Mn) Customer Deposits Total Assets Net Loans and advances 7,120 20,728 25,434 +16% +16% +15% 18,102 21,856 6,158 Jun-21 Jun-22 Jun-21 Jun-22 Jun-21 Jun-22 ✓ Growth in Loan and Advances portfolio suppor
Slide 33: Mauritius Economic Review
Mauritius Economic Review Macro economic update Mauritius GDP Growth (%) 6.1% 5.60% • GDP is expected to grow atleast 6.1% in 2022; Most sectors have picked up since the 3.9% 3.0% pandemic; • Inflation dropped marginally in June 2022 to 9.6% (10.7% in May 2022); Country has taken several social meas
Slide 34: Mauritius: business stabilization after 2021 restructuring (P&L)
Mauritius Business stabilization on the back of balance sheet restructuring in 2021 P&L (KES Mn) Operating Income Recoveries Profit Before Tax 109 718 1,791 -8% -61% -34% 1,640 471 43 Jun-21 Jun-22 Jun-21 Jun-22 Jun-21 Jun-22 Key Ratios Jun-21 Jun-22 ✓ Dampened economic activity, lower transaction v
Slide 35: Mauritius: business stabilization (balance sheet)
Mauritius Business stabilization on the back of balance sheet restructuring in 2021 Balance Sheet (KES Mn) Total Assets Net Loans & Advances Customer Deposits 54,302 117,948 98,361 116,509 -1% -4% 51,898 -3% 94,967 Jun-21 Jun-22 Jun-21 Jun-22 Jun-21 Jun-22 ✓ Marginal decline in Balance sheet as a re
Slide 36: Group Outlook
c We Are On Your Side Group Outlook 36 Classification: Public
Slide 37: Group Outlook: navigating growth amidst global uncertainty
Group Outlook Navigating business growth amidst continued global economic and geopolitical uncertainty; Entrench the financial services in the customer’s operations while making it I&M Group’s focus as convenient as possible for them to do business. is on delivering Target NPS score +75% sustainable
Slide 38: Summary Highlights: strong and consistent financial performance in HY 2022
Summary Highlights Strong and consistent financial performance in HY 2022 Profit Before Tax Customer Deposits Net Loans & Advances Return on Kshs Kshs Kshs Equity 7.2 bn 313bn 231bn 14% +22% +13% +13% +1% (Absolute) Classification: Public
Slide 39: Disclaimer
Disclaimer The contents herein have been presented in good faith. The information, statements and opinions set out in this presentation and subsequent discussion do not constitute a public offer for the purposes of any applicable law or an offer to sell or solicitation of any offer to purchase any s
Slide 40: Thank You
c We Are On Your Side Thank You I&M GROUP PLC 1 PARK AVENUE 1ST PARKLANDS P.O. BOX 30238 – 00100 TEL: +254 (0)20 3221000 Investor-Relations@imgroup-plc.com 40 Classification: Public