Slide 1: Q2 2023 Results Presentation
Q2 2023 Results Presentation Riyad Bank Presenters: Mr. Tareq Al Sadhan, CEO Mr. Abdullah Al Oraini, CFO Dr. Naif Al Ghaith, Chief Economist Ms. Najla Al Mutairi, Head of IR Host: Mr. Faisal Potrik, Head of Research – Riyad Capital General Business
Slide 2: Bank Overview
Riyad Bank is the third largest bank in Saudi Arabia Riyad Bank presence China Soon To be the most innovative & trusted 6,549 Employees London financial solutions 31% Female employees 1 Branch Singapore 1 Rep Office partner Q2 2023 Key Metrics Assets Operating Income Cost / income Ratio Houston 1 Ag
Slide 3: Recent changes in the macro and regional environment warranted a review of the strategy for 2025
Recent changes in the macro and regional environment warranted a review of the strategy for 2025 Rapid increase interest rates impacting credit off- take Continued focus on internal Higher liquidity costs capabilities to leapfrog in the market competition Global Economy ESG becoming Mortgage market
Slide 4: Our aspirations remain unchanged: Become the best bank in KSA
But our aspirations remain unchanged: Become the best bank in KSA Become the Best Bank in KSA Strategic Pillars Most Most Bank of choice Most innovative & profitable efficient digitally enabled Global Economy Sustainable profit Highest return on Best bank for Most innovative and Definition and Focus
Slide 5: Vision 2030 initiatives
Vision 2030 initiatives RiyadBankisfullycommittedtothesuccessoftheNationalAgenda The initiatives contribute to 96 KPIs of the Saudi vision 2030 FinancialSupport Program 100% Future initiatives Financial Support Massar Business Developing Execution Tools InitiativeforNCPP Program 90%
Slide 6: ESG Highlights
From philanthropy to sustainability – ESG Highlights As of Q2-2023 Embedding corporate responsibility and sustainability into the Bank’s strategy World Day to Combat Al-Hajj intuitive “We Desertification 750 M 214 Hours care” Updated guidelines to Bukra Ambassadors As part of our social ISO/DIS 3730
Slide 7: Economic environment
Economic environment 6 General Business
Slide 8: Global Growth has been Surprisingly Resilient
Global Growth has been Surprisingly Resilient Global growth is projected to fall from 3.4% in 2022 to 2.1% in 2023, below the historical average (2000–19) of 3.8%. In 2024, global output is forecasted to rise to 2.4%, according to a recent projections by the World Bank US and the EU 2023 real GDP pr
Slide 9: Non-oil Economy Continues to Show Strong Growth
Non-oil Economy Continues to Show Strong Growth The real economy grew by 3.8% YoY in the first quarter of 2023, driven by 5.4% increase in non-oil activities while oil activities rose by 1.4%. Government activities increased by 4.9%, the highest since 2018. Real GDP rose by 3.8% YoY in the first qua
Slide 10: Moderate Price Pressures Remain on Strong Demand
Moderate Price Pressures Remain on Strong Demand Headline inflation remains elevated and was driven mainly by an increase in housing rents which increased by 9.1% from a year earlier. However, improved supply chains have helped cool output prices for goods. CPI Inflation eased to 2.7% YoY in June fr
Slide 11: Financial results overview
Financial results overview 10 General Business
Slide 12: H1 2023 Key highlights
H1 2023 Key highlights H1 2023 Vs. H1 2022 +8.7% +9.8% +5.3% +14.7% +1.9% Balance Sheet Total assets Loan and Investments, net Customer Demand & other advances, net deposits deposits +26.5% +36.8% -0.7% +26.2% Credit related impairment increased by 153.2% . Income Statement Net income Cost of Ri
Slide 13: Financial highlights – Balance sheet
Financial highlights – Balance sheet Stable balance sheet performance SAR (mn) Q2 2023 Q1 2023 QoQ % Change Q2 2022 YoY % Change Total Assets Growth Drivers (SARbn) Cash and balances with SAMA and 59,313 63,644 -6.8% 56,293 +5.4% +8.1% financial institutions Investments, net 56,388 54,695 +3.1% 53,5
Slide 14: Assets & lending
Assets & lending Loan growth mainly driven by Commercial and Mortgage loans Mortgage Loans, Gross (SARbn) Loans & Advances, Net Growth Drivers (SARbn) +8.7% 14.8% 0 0 7 14 0 263 58 60 62 242 54 56 51 Q4-22 Overdrafts Credit Consumer Commercial Others Q2-23 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Cards L
Slide 15: Liabilities and funding
Liabilities and funding Stable funding profile Customer Deposits Growth Drivers (SARbn) Q2 2023 Total Liabilities Mix (SARbn) +13.3% 24 7 272 3% 5% 10% 240 1 0 SAR 332 Bn Q4-22 Demand Savings Time Others Q2-23 82% Total Customer Deposits by Type (SARbn) Financial highlights +13.3% 272 Due to Banks &
Slide 16: Financial highlights – Income statement
Financial highlights – Income statement Net income growth mainly due to higher operating income SAR (mn) H1 2023 H1 2022 YoY % Change Q2 2023 Q1 2023 QoQ % Change Net Income before Zakat Growth Drivers by Segment (SARmn) Net special commission income 6,197 4,529 +36.8% 3,109 3,088 +0.7% +25.6% Fee a
Slide 17: Income trends
Income trends Income growth supported by stable balance sheet growth Total Operating Income Growth Drivers by Segment (SARmn) Total Operating Income, Net (SARmn) +26.2% 1,260 7,989 6,332 727 +22.4% (90) 4,036 (240) 3,742 3,952 3,525 3,102 3,230 H1-22 Retail Corporate Treasury & Riyad Capital H1-23 I
Slide 18: Expenses trends
Expenses trends Improved cost efficiency despite Banks’ investment in its Transformation Program Operating Expenses (SARmn) Operating Expenses Growth Drivers by Type (SARmn) +16.0% +14.2% 1,174 1,162 1,234 1,064 1,138 57 90 2,396 1,034 155 2,098 (4) Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 H1-22 Employee
Slide 19: Credit quality
Credit quality Stable asset quality trends with solid NPL coverage ratio Impairment Charge for Credit Losses, Net (SARmn) Cost of Risk (YTD %) +60.3% 0.92% 581 0.83% 484 378 0.44% 302 0.39% 0.37% 204 0.26% 148 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q1-22 H1-22 9M-22 FY-22 Q1-23 H1-23 Annualized YTD Imp
Slide 20: Capitalization
Capitalization Capitalization well above regulatory minima and continues to support growth Capitalization (SARbn) Capital Ratios (%) +1.5% 65 65 66 22 21.1% 20.7% 20.7% 50 50 51 21 19.2% 19.5% 20 19.1% 6 6 6 9 9 9 19 18.1% 17.8% Q4-22 Q1-23 Q2-23 18 17.8% 16.3% 17 16.4% 16.0% Common equity tier 1 ca
Slide 21: Liquidity
Liquidity Liquidity continues to be at comfortable levels HQLA and Liquidity Coverage (SARbn/%) Loans to Deposit Ratios (%) 182% 187% 181% 172% 165% 157% 10,40 102.4% 72 100.9% 101.0% 60 10,20101.0% 54 56 56 51 10,00 97.9% 9,80 96.7% 9,60 97.7% 97.4% 96.2% 9,40 94.9% 94.7% 9,20 93.6% Q1-22 Q2-22 Q3-
Slide 22: Guidance
Guidance 21 General Business
Slide 23: FY 2023 Guidance
FY 2023 Guidance Guidance Metric FY 2022 Guidance H1 2023 Guidance (Revision) SAR 242 Bn SAR 263 Bn Loans, Net High Single to Low Double Digit High Single to Low Double Digit (+11.5% YoY) (+9.8% YoY) NSCI Margin (%) 3.11% +40 bps – +60bps 3.69% +40 bps – +60bps Cost to Income (%) 32.4% Below 33% 30.
Slide 24: Q&A
RS oO eee oreoes * + &A ° ° seoeen woreees General Business
Slide 25: Appendix
Appendix 24 General Business
Slide 26: Riyad Bank contact
Riyad Bank contact Contact the investor relations for more information: Najla K. Al Mutairi Head of Investor Relations Annual 2022 Report Telephone: +966 11 401 3030 Ext. 2448 E-mail: najla.almutairi@riyadbank.com Address: Riyadh - Al Shuhada District Eastern ring road Granada Oasis -Tower (A1) P.O
Slide 27: Disclaimer
Disclaimer This presentation has been prepared by Riyad Bank solely for informational purposes. The presentation may contain forward looking statements, which reflect Riyad Bank's beliefs or current expectations and assumptions regarding the future of the business, future plans and strategies, proje