United Overseas Bank Limited · SGX:U11
United Overseas Bank — H1 2016 Earnings Presentation
31 slides from United Overseas Bank's earnings presentation, Jul 28, 2016
Slide 1: UOB Group First Half 2016 Financial Highlights
UOB Group First Half 2016 Financial Highlights Lee Wai Fai Group Chief Financial Officer 28 July 2016 Disclaimer : This material that follows is a presentation of general background information about the Bank’s activities current at the date of the presentation. It is information given in summary fo
Slide 2: 1H16 NPAT of $1.57 billion, up 0.2% YoY
1H16 NPAT of $1.57 billion, up 0.2% YoY 1H16 1H15 +/(-) $m $m % Net interest income 2,485 2,414 3.0 p Fee and commission income 907 919 (1.2) q Other non-interest income 600 550 9.2 p Total income 3,993 3,882 2.8 p Less: Total expenses 1,821 1,729 5.3 p Operating profit 2,172 2,153 0.8 p Less: Speci
Slide 3: 2Q16 NPAT of $801 million, up 5% QoQ
2Q16 NPAT of $801 million, up 5% QoQ 2Q16 2Q15 +/(-) 1Q16 +/(-) $m $m % $m % Net interest income 1,211 1,213 (0.2) q 1,275 (5.0) q Fee and commission income 475 465 2.0 p 433 9.6 p Other non-interest income 338 248 36.2 p 262 29.3 p Total income 2,024 1,927 5.0 p 1,969 2.8 p Less: Total expenses 927
Slide 4: NII Rose 3% YoY supported by Loan Growth
NII Rose 3% YoY supported by Loan Growth Net Interest Income (NII) and Margin 2.12% 2.26% 2.29% 2.06% 2.26% 2.27% 2.34% 2.36% 2.23% 1.72% 1.71% 1.77% 1.73% 1.77% 1.77% 1.79% 1.78% 1.68% 0.76% 0.82% 0.50% 0.28% 0.50% 0.46% 0.40% 0.30% 0.25% 4,926 4,558 391 4,120 620 537 1,213 1,235 1,277 1,275 1,211
Slide 5: Stable Fee Income and Stronger Trading Income
Stable Fee Income and Stronger Trading Income Non-Interest Income (Non-NII) and Non-NII Ratio 38.7% 38.9% 38.8% 37.8% 40.8% 38.6% 40.2% 37.0% 35.3% 25.8% 23.5% 23.4% 22.7% 24.2% 23.3% 23.1% 22.0% 23.4% 3,122 2,900 284 2,600 334 325 954 817 850 544 803 813 55 714 60 695 83 1,507 92 60 310 263 256 143
Slide 6: Continued Investment in IT Capabilities
Continued Investment in IT Capabilities Operating Expenses and Expense / Income Ratio 44.7% 45.6% 43.1% 46.3% 45.8% 45.5% 45.4% 43.4% 43.1% 42.2% 43.4% 45.5% 44.3% 42.3% 3,597 ^ 3,146 ^ 2,898 1,533 964 927 1,321 877 904 ^ ^ 894 1,186 1,821 442 405 359 376 389 794 2,064 1,712 1,825 517 528 522 506 52
Slide 7: Total Credit Costs Stable at 32bps
Total Credit Costs Stable at 32bps Allowances on Loans 30bp 32bp 32bp 32bp 32bp 32bp 32bp 32bp 32bp 24bp 19bp 31bp 12bp 25bp 23bp 8bp 22bp 11bp 392 253 238 160 133 115 121 136 56 2013 2014 2015 1H16 2Q15 3Q15 4Q15 1Q16 2Q16 Specific Allowances on Loans ($m) Specific Allowances on Loans/Average Gross
Slide 8: Performance by Business Segment
Performance by Business Segment 1H16 1H16 1H15 +/(-) -9% 6% Segment Operating Profit $m $m % 41% Group Retail (GR) 883 750 17.7 Group Wholesale Banking (GWB) 1,352 1,264 7.0 62% Global Markets (GM) 131 109 20.2 Others (194) 30 (>100.0) 1H15 5% Total 2,172 2,153 0.8 1% 35% 59% GR GWB GM Others 8
Slide 9: Regional Operating Profit Rose 4% YoY in Constant Currency Terms
Regional Operating Profit Rose 4% YoY in Constant Currency Terms 1H16 At 8% 6% constant 4% FX rate 7% Operating 1H16 1H15 +/(-) +/(-) Profit $m $m % % 61% 14% Singapore 1,319 1,300 1.5 1.5 1H15 Regional: 671 677 (0.8) 3.6 Malaysia 302 307 (1.7) 7.1 8% 9% Thailand 148 133 11.9 18.1 2% Indonesia 83 49
Slide 10: Loans increased to $212b, up 6% YoY and 2% QoQ in Constant Currency Terms
Loans increased to $212b, up 6% YoY and 2% QoQ in Constant Currency Terms Jun-16 Jun-16 Jun-15 +/(-) Mar-16 +/(-) 9% Gross Loans $b $b % $b % 12% Singapore 119.9 115.0 4.2 117.8 1.8 5% 56% Regional: 72.8 71.1 2.4 72.4 0.6 6% Malaysia 25.4 25.3 0.3 25.5 (0.4) 12% Thailand 11.6 11.0 5.8 11.4 2.3 Jun-1
Slide 11: Deposits decreased by 2%, on constant currency terms
Deposits decreased by 2%, on constant currency terms, through proactive liquidity management Jun-16 5% Customer Jun-16 Jun-15 +/(-) Mar-16 +/(-) 5% Deposits $b $b % $b % 3% 5% Singapore 177.1 163.5 8.3 177.4 (0.2) 11% Regional: 58.3 57.5 1.4 61.7 (5.6) 71% Malaysia 26.8 27.2 (1.6) 27.0 (0.8) Thailan
Slide 12: Stable Liquidity Position
Stable Liquidity Position Customer Loans and Deposits; LDR and LCR 84.7% 84.0% 82.3% 81.6% 80.7% 244.6 254.8 248.2 241.5 240.5 198.8 199.6 203.6 205.6 208.4 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Loan/Deposit Ratio (LDR) (%) Customer Deposits ($b) Loan/Deposit Ratio (LDR) (%) SGD LDR (%) 91.9 88.4 91.7
Slide 13: NPL Ratio remains stable
NPL Ratio remains stable NPL ($m) 2,504 2,551 2,882 2,841 3,056 NPL Ratio 1.2% 1.3% 1.4% 1.4% 1.4% 206 344 176 401 351 218 158 564 377 149 166 569 564 264 335 372 249 250 451 289 238 386 401 378 423 1,395 1,046 1,116 1,067 931 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Singapore Malaysia Thailand Indonesia
Slide 14: Movements in Non-Performing Assets
Movements in Non-Performing Assets 2Q16 1Q16 2Q15 $m $m $m NPA at start of period 3,016 3,066 2,692 New NPA 802 344 372 Upgrades, recoveries and translations (548) (235) (263) Write-offs (106) (159) (96) NPA at end of period 3,164 3,016 2,705 14
Slide 15: Exposure to China
Exposure to China Total = SGD19.4b Bank exposure in China or 6.0% of total assets 99% with <1 year tenor Around 75% accounted for by top 5 domestic banks and policy banks Bank, Trade exposures mostly with bank counterparties, SGD10.7b representing around half of bank exposure Debt, Non-bank ex
Slide 16: Exposure to Commodities
Exposure to Commodities Oil and gas As of Traders/ Other commodity Upstream Total 30 June 16 downstream segments industries industries Total SGD4.9b SGD9.1b SGD8.8b SGD22.8b exposure1 Outstanding SGD4.0b SGD5.3b SGD6.6b SGD15.9b loans 4% of total loans 7.5% of total loans Total exposure, including
Slide 17: Exposure to Europe
Exposure to Europe As of As a % of total Non-bank Bank Debt securities Total 30 Jun 2016 assets Europe SGD3.4b SGD3.1b SGD1.2b SGD7.7b 2.4% of which UK SGD2.6b SGD0.8b SGD0.2b SGD3.6b 1.1% Minimal direct impact from Brexit Bulk of UK non-bank exposure is secured and denominated in GBP Consumer m
Slide 18: Strong Loan Allowances Coverage
Strong Loan Allowances Coverage Total Loan Allowances 3,609 3,640 3,760 3,783 3,837 ($m) 340.5% 345.4% 315.7% 325.3% 332.5% 144.1% 142.7% 130.5% 133.2% 125.6% 773 751 770 747 712 2,862 2,928 2,987 3,032 3,067 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 General Allowances ($m) Total Allowances/Total NPL (%) S
Slide 19: Capital Ratios Remained Strong
Capital Ratios Remained Strong Capital Adequacy Ratios (CAR) 16.8% 16.4% 15.6% 16.0% 15.9% 2.8% 2.8% 2.6% 3.2% 2.7% Total CAR Tier 2 CAR Tier I CAR 14.0% 13.6% 13.2% 13.0% 12.8% Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 CET1 Capital ($b) 25 25 26 26 26 Tier 1 Capital ($b) 25 25 26 26 27 Total Capital ($b)
Slide 20: Interim Dividend
Interim Dividend 20 5 5 35 50 50 35 35 20 20 2013 2014 2015 1H16 Net dividend per ordinary share (¢) Interim Final Special UOB 80th Anniversary 1H13 1H14 1H15 1H16 Payout amount ($m) 315 320 561 563 Payout ratio (%) 21 20 36 36 20
Slide 21: Singapore – Summarised Income Statement
Singapore – Summarised Income Statement 1H16 1H15 +/(-) 2Q16 1Q16 +/(-) $m $m % $m $m % Net interest income 1,361 1,322 2.9 648 713 (9.1) Fee and commission income 541 543 (0.3) 286 256 11.7 Other non-interest income 420 357 17.8 248 173 43.5 Total income 2,323 2,222 4.5 1,182 1,141 3.5 Less: Total
Slide 22: Singapore – Key Financial Indicators
Singapore – Key Financial Indicators 1H16 1H15 +/(-) 2Q16 1Q16 +/(-) % % % pt % % % pt Net interest margin 1.32 1.40 (0.08) 1.24 1.40 (0.16) Non-NII/Total income 41.4 40.5 0.9 45.1 37.5 7.6 Expense/Total income 43.2 41.5 1.7 43.3 43.1 0.2 Customer loans (net) - $b 134.0 128.9 4.0% 134.0 131.9 1.6% C
Slide 23: Malaysia – Summarised Income Statement
Malaysia – Summarised Income Statement 1H16 1H15 +/(-) 2Q16 1Q16 +/(-) RM'm RM'm % RM'm RM'm % Net interest income 995 978 1.7 485 510 (4.9) Fee and commission income 299 285 4.9 163 136 19.9 Other non-interest income 154 110 40.0 66 88 (25.0) Total income 1,448 1,373 5.5 714 734 (2.7) Less: Total e
Slide 24: Malaysia – Key Financial Indicators
Malaysia – Key Financial Indicators 1H16 1H15 +/(-) 2Q16 1Q16 +/(-) % % % pt % % % pt Net interest margin 2.27 2.28 (0.01) 2.20 2.35 (0.15) Non-NII/Total income 31.3 28.8 2.5 32.1 30.5 1.6 Expense/Total income 38.6 39.5 (0.9) 41.5 35.8 5.7 Customer loans (net) - RM'b 74.2 71.3 4.1% 74.2 73.4 1.2% Cu
Slide 25: Thailand – Summarised Income Statement
Thailand – Summarised Income Statement 1H16 1H15 +/(-) 2Q16 1Q16 +/(-) THB'm THB'm % THB'm THB'm % Net interest income 7,051 6,433 9.6 3,572 3,479 2.7 Fee and commission income 2,746 2,836 (3.2) 1,398 1,348 3.7 Other non-interest income 398 109 >100.0 306 92 >100.0 Total income 10,195 9,378 8.7 5,27
Slide 26: Thailand – Key Financial Indicators
Thailand – Key Financial Indicators 1H16 1H15 +/(-) 2Q16 1Q16 +/(-) % % % pt % % % pt Net interest margin 3.56 3.43 0.13 3.54 3.59 (0.05) Non-NII/Total income 30.8 31.4 (0.6) 32.3 29.3 3.0 Expense/Total income 62.4 65.4 (3.0) 61.5 63.4 (1.9) Customer loans (net) - THB'b 292.7 266.5 9.8% 292.7 287.5
Slide 27: Indonesia – Summarised Income Statement
Indonesia – Summarised Income Statement 1H16 1H15 +/(-) 2Q16 1Q16 +/(-) IDR'b IDR'b % IDR'b IDR'b % Net interest income 1,609 1,307 23.1 844 765 10.3 Fee and commission income 383 355 7.9 205 178 15.2 Other non-interest income 276 176 56.8 138 138 - Total income 2,268 1,838 23.4 1,187 1,081 9.8 Less
Slide 28: Indonesia – Key Financial Indicators
Indonesia – Key Financial Indicators 1H16 1H15 +/(-) 2Q16 1Q16 +/(-) % % % pt % % % pt Net interest margin 4.47 3.83 0.64 4.71 4.22 0.49 Non-NII/Total income 29.1 28.9 0.2 28.9 29.2 (0.3) Expense/Total income 64.4 74.5 (10.1) 63.6 65.3 (1.7) Customer loans (net) - IDR't 59.6 54.0 10.4% 59.6 57.0 4.6
Slide 29: Greater China – Summarised Income Statement
Greater China – Summarised Income Statement 1H16 1H15 +/(-) 2Q16 1Q16 +/(-) $m $m % $m $m % Net interest income 185 193 (4.3) 91 94 (2.4) Fee and commission income 53 56 (4.9) 25 29 (14.0) Other non-interest income 67 92 (26.8) 35 32 7.0 Total income 305 341 (10.5) 151 155 (2.6) Less: Total expenses
Slide 30: Greater China – Key Financial Indicators
Greater China – Key Financial Indicators 1H16 1H15 +/(-) 2Q16 1Q16 +/(-) % % % pt % % % pt Net interest margin 1.11 1.25 (0.14) 1.09 1.13 (0.04) Non-NII/Total income 39.4 43.3 (3.9) 39.4 39.5 (0.1) Expense/Total income 54.8 44.8 10.0 54.4 55.1 (0.7) Customer loans (net) - $b 18.8 17.7 6.0% 18.8 18.4
Slide 31: Thank you
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