Slide 1: Interim Results 2005
Interim Results 2005 8 August 2005 Leading the way in Asia, Africa and the Middle East
Slide 2: Leading the way in Asia, Africa and the Middle East
Leading the way in Asia, Africa and the Middle East Bryan Sanderson Chairman
Slide 3: Performance highlights
Performance highlights Income US$3,236m 19% Profit before tax US$1,333m 20% Normalised EPS 75.2c 32% Dividend (per share) 18.94c 11%
Slide 4: Global trends
Global trends GDP growth % 2004 2005F* 2006F* China 9.5 9.2 8.0 India 8.5 6.9 7.0 South Korea 4.6 3.8 4.0 Hong Kong 8.1 4.0 4.0 Singapore 8.4 3.5 3.8 Malaysia 7.0 5.8 5.0 UAE 8.0 8.0 3.0 Nigeria 6.1 7.0 4.9 Indonesia 5.1 5.5 5.7 South Africa 3.7 4.3 3.8 *Standard Chartered forecasts
Slide 5: Strategic approach
Strategic approach Strategy fundamentally organically led Disciplined approach towards acquisitions Delivers shareholder value Optimal trade-off against organic opportunities Access to market, product or client segment
Slide 6: Governance
Governance Good governance re-enforces good performance through: Clear accountabilities Robust controls Right behaviours Integrity of governance throughout network
Slide 7: Summary
Summary Performance track record Achieving strategic goals Governance and processes
Slide 8: Leading the way in Asia, Africa and the Middle East
Leading the way in Asia, Africa and the Middle East Peter Sands Group Finance Director
Slide 9: Group results
Group results (including KFB) US$m H1 2004 H2 2004 H1 2005 Income 2,725 2,657 3,236 Expenses (1,410) (1,439) (1,708) Operating profit before provisions 1,315 1,218 1,528 Loan impairment (139) (75) (194) Fixed asset impairment (69) 1 (1) Operating profit before tax 1,107 1,144 1,333 Profit attributab
Slide 10: Performance highlights
Performance highlights (including KFB) Normalised metrics H1 2004 H2 2004 H1 2005 Cost income ratio 54.0% 54.0% 52.6% Return on ordinary shareholders equity 18.0% 18.6% 18.4% Earnings per share 57.1c 67.5c 75.2c
Slide 11: Group results (excluding KFB and one-offs)
Group results (excluding KFB and one-offs) US$m H1 2004 H2 2004 H1 2005 YOY % Income 2,615 2,659 2,978 14 Expenses (1,392) (1,434) (1,562) 12 Operating profit before provisions 1,223 1,225 1,416 16 Loan impairment (139) (75) (166) 19 Fixed asset impairment (2) 1 (1) 50 Operating profit before tax 1,
Slide 12: Results by geography
Results by geography (excluding KFB and one-offs) Operating profit before tax US$m H1 2004 H2 2004 H1 2005 YOY % Hong Kong 283 320 360 27 Singapore 129 123 104 -19 Malaysia 63 61 70 11 Other APR 139 128 262 88 India 132 86 137 4 UAE 83 87 91 10 Other MESA 97 110 124 28 Africa 103 109 30 -71 Americas
Slide 13: Consumer Banking results
Consumer Banking results (excluding KFB) US$m H1 2004 H2 2004 H1 2005 YOY % Income 1,335 1,365 1,525 14 Expenses (679) (721) (771) 14 Operating profit before provisions 656 644 754 15 Loan impairment (137) (105) (164) 20 Operating profit before tax 519 539 590 14
Slide 14: Consumer Banking income
Consumer Banking income (excluding KFB) US$m H1 2004 H2 2004 H1 2005 YOY % Hong Kong 489 465 483 -1 Singapore 168 162 163 -3 Malaysia 88 87 101 15 Other APR 180 220 304 69 India 124 134 143 15 UAE 59 65 74 25 Other MESA 81 91 103 27 Africa 107 111 124 16 Americas, UK & Group 39 30 30 -23 Total 1,335
Slide 15: Consumer Banking expense growth
Consumer Banking expense growth (excluding KFB) Incremental cost US$m YOY YOY % Hong Kong 0 0 Singapore 3 5 Components of expense growth % Malaysia 1 2 8 Investment for future Other APR 55 49 growth India 16 23 1 Regulatory/Control 24 5 BAU/Volume UAE 6 14 Other MESA 9 20 Africa 7 8 UK/Americas (5)
Slide 16: Consumer Banking loan impairment
Consumer Banking loan impairment (excluding KFB) US$m H1 2004 H2 2004 H1 2005 YOY % Specific provisions (137) (134) (147) 7 General provision release 29 Specific portfolio provision (17) Total (137) (105) (164) 20 Customer assets (US$bn) 32.7 35.5 36.9 13
Slide 17: Wholesale Banking results
Wholesale Banking results (excluding KFB) US$m H1 2004 H2 2004 H1 2005 YOY % Income 1,280 1,294 1,453 14 Expenses (713) (713) (791) 11 Operating profit before provisions 567 581 662 17 Loan impairment (2) 30 (2) Fixed asset impairment (2) 1 (1) Operating profit before tax 563 612 659 17
Slide 18: Wholesale Banking income growth
Wholesale Banking income growth (excluding KFB) Customer income growth Income growth by segment by product % US$m H1 2004 H1 2005 Multinational 14 Trade and Lending 433 412 Large Local Global Markets 618 725 9 Corporates Cash Management Local & Custody 229 316 16 Corporates Total 1,280 1,453 Financi
Slide 19: Wholesale Banking results by geography
Wholesale Banking results by geography (excluding KFB) Operating profit before tax US$m H1 2004 H2 2004 H1 2005 YOY % Hong Kong 50 92 106 112 Singapore 40 33 20 -50 Malaysia 28 21 32 14 Other APR 103 67 184 79 India 89 51 107 20 UAE 53 53 56 6 Other MESA 65 73 80 23 Africa 92 104 9 -90 Americas, UK
Slide 20: Wholesale Banking expense growth
Wholesale Banking expense growth (excluding KFB) US$m +78 791 713 +11% Components of expense growth % 5 Investment for future growth 2 Regulatory/Control 4 BAU/Volume 11 H1 2004 H1 2005
Slide 21: Wholesale Banking loan impairment
Wholesale Banking loan impairment (excluding KFB) US$m H1 2004 H2 2004 H1 2005 Specific provisions (72) (85) (102) Recoveries 70 89 112 Net (2) 4 10 General provision release — 26 — Specific portfolio provision — — (12) Total (2) 30 (2) Customer assets (US$bn) 31.4 37.0 38.7
Slide 22: KFB results since 15 April
KFB results since 15 April Cards and Loans 77 Trade and Lending 25 Wealth Management 53 Global Markets 32 Mortgages 67 Cash & Custody 3 Other 2 Consumer Wholesale US$m Banking Banking Total Income 198 60 258 Expenses (117) (29) (146) Loan impairment (29) 1 (28) Operating profit before tax 52 32 84
Slide 23: KFB balance sheet
KFB balance sheet Customer assets US$m Other CB assets 9% Consumer Wholesale SME Banking Banking Total 14% Net NPLs 419 35 454 As % of Wholesale customer 18% assets 1.56 0.59 1.39 Mortgages Cards 57% 2% Total : US$33bn at 30 June, 2005
Slide 24: Risk management
Risk management (including KFB) Net NPL US$m LMA Underlying 1500 1383 KFB 1250 Net NPL as % of 1000 904 assets ex LMA 779 1.2% 750 0.9% 500 0.7% 250 0 H1 04 H2 04 H1 05 Wholesale Banking 82% 86% 88% cover ratio (%)
Slide 25: Capital management
Capital management (including KFB) % 16 Total 15.6 Total 15.0 14 Total 13.0 12 10 8 6 9.2 8.6 4 7.3 2 0 H1 2004 H2 2004 H1 2005 Tier 1 Tier 2
Slide 26: Delivery and investment
Delivery and investment Consistent performance delivery Delivering acquisition benefits Investing for growth
Slide 27: Leading the way - Mervyn Davies, Group Chief Executive
Leading the way in Asia, Africa and the Middle East Mervyn Davies Group Chief Executive
Slide 28: Our performance
Our performance US$m 1,400 1,333 75 1,200 1,107 1,144 Operating profit before tax Normalised EPS (cents) 1,000 879 820 800 628 730 634 628 559 50 600 461 400 200 25 H1 00 H2 00 H1 01 H2 01 H1 02 H2 02 H1 03 H2 03 H1 04* H2 04* H1 05† *2004 reported on an IFRS basis excluding IAS 32/39, †2005 reporte
Slide 29: 2005 priorities
2005 priorities Expand Consumer Banking customer segments and products Continue Wholesale Banking transformation Integrate Korea First Bank and deliver growth Accelerate growth in India and China Deliver further technology benefits Embed Outserve into our culture
Slide 30: Our markets
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Slide 32: Our products
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Slide 33: Our service
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Slide 34: Our people
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Slide 35: Our investments
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Slide 36: Korea First Bank
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Slide 37: Korea First Bank
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Slide 39: Korea First Bank products
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Slide 40: Outlook
Outlook Growing markets Strong businesses Investments performing well