National Bank Of Kuwait K.s.c. · KSE:NBK
National Bank Of Kuwait K.s.c — National Bank of Kuwait — Investor Presentation (October 2010)
31 slides from National Bank Of Kuwait K.s.c's investor presentation, October 2010
Slide 1: National Bank of Kuwait Investor Presentation
National Bank of Kuwait Investor Presentation October 2010
Slide 2: Agenda
National Bank of Kuwait NBK Group overview Financial summary and review Strategy overview • Kuwait operations • Regional and International operations • Islamic Banking (Boubyan) • Investment Banking (NBK Capital) Appendix 1
Slide 3: NBK Group overview
National Bank of Kuwait NBK Group overview 2
Slide 4: NBK Group Overview: A player in its own league
NBK Group A player in its own league Overview First private bank Established in 1952 by the leading merchant families in the country to become the first private in the GCC indigenous bank in Kuwait and the GCC. Largest and most Assets of over USD 43 billion and a market share in excess of 30 % in al
Slide 5: Regional and international presence
NBK Group Regional and international presence Overview unrivaled by any other MENA bank MENA Location Year Branches Status Kuwait 1952 71 Head quarters Regional expansion Bahrain is at the core 1987of NBK’s 2 Branch Lebanon diversification 1996 strategy 10 Subsidiary Iraq (CBI) 2004 15 Subsidiary Qa
Slide 6: Highest regional ratings and top award recognition
NBK Group Highest regional ratings and top award Overview recognition FitchRatings Bank Financial Strength Rating C+ Individual Strength Rating B Counterparty Credit Rating: Deposit Rating: F i C Foreign Currency R Rating: ti Long Term A+ Long Term Aa2 Long Term AA- Short Term A-1 Short Term P-1 Sho
Slide 7: A safe-haven with an outstanding track record of profitability
NBK Group A safe-haven with an outstanding track Overview record of profitability Net profits (USD million) 954 925 883 890 All Kuwaiti banks profits 1H2010 717 524 350 366 370 423 44.7% 55.3% *2010 net profits are based on 9M2010 profits annualized NBK Other banks 1.96% 1.95% 215% NPLs/Gross Loans
Slide 8: A clear strategy focused on diversification
NBK Group A clear strategy focused on Overview diversification Maintain excellence and leadership in the Kuwaiti market DEFEND AND GROW Leverage solid financial position to expand market share DOMESTIC LEADERSHIP M i t i discipline Maintain di i li ini managing i risks i k and d costs t Leverage fun
Slide 9: Financial summary and review
National Bank of Kuwait Financial summary and review 8
Slide 10: Key Performance extracts
NBK Group Key Performance extracts Financial Review Strong financial results Well controlled risks and high asset quality 925 27% 15% 890 1,217 Trading and Mftg 16% 1,180 789 Well diversified Const and RE 17% 709 940 p assets exposure 8% Banks and OFI 27% 892 (Dec 09) Retail 15% Government 8% 17% 17
Slide 11: Scale transformation
NBK Group Scale transformation Financial Review Large asset base, sound financial strength and strong capitalization lend resilience to NBK’s activities and allows harnessing ongoing expansion opportunities Assets (USD billions) Loans and Advances (USD billions) Customer Deposits (USD billions) 45.4
Slide 12: Solid and diversified earnings
NBK Group Financial Review Solid and diversified earnings Operating Income (USD millions) Net Interest Margin 1,773 1,808 3.3% 3.3% 3.1% 1 416 1,416 1,315 2008 2009 9M 2009 9M 2010 2008 2009 9M 2010 9M 2010 Operating Income breakdown 9M 2010 Operating p g Income by y Business Line Corporate 36% Net
Slide 13: Quality loan portfolio
NBK Group Quality loan portfolio Financial Review Net Loan Portfolio (USD billions) Net Loans to Total Assets (%) 60.6 62.2 27.5 27.3 Dec 09 Sep 10 Dec 09 Sep 10 Loan Exposures (Sep 10) Non-Performing Loans (% of Gross Loans) Personal Manufacturig Dec 09 1.76% 28% 7% Sep-10 1.61% Telecom & Retail &
Slide 14: Market positioning strengthens in times of crisis
NBK Group Market positioning strengthens in times Financial Review of crisis NPLs/Gross Loans (%) NPLs coverage ratio (%) 11.1 240 208 183 6.4 166 151 144 3.3 88 2.8 65 2.0 1.9 1.8 1.2 2006 2007 2008 2009 2006 2007** 2008 2009 NBK Sector NBK Sector NPL provisions/Loans (%) NBK share of sector profit
Slide 15: Strategy overview: Kuwait Operations
National Bank of Kuwait St t Strategy overview i • Kuwait Operations 14
Slide 16: Budget remains in surplus 10/11F
Budget remains in surplus Kuwait Operations Total planned spending increases of 33% in the 2010/11 budget (+66% in capital spending) should boost domestic demand and provide good stimulus. Government Revenues and Spending (KD’bn) Planned demand impacting expenditure* (KD billion) 24 20 16 12 8 4 0 1
Slide 17: Pick-up in project implementation could turn the tide in Kuwait
Pick-up in project implementation could Kuwait Operations turn the tide in Kuwait Kuwait recently adopted a four-year development plan that includes more than USD100 billion in new projects with half of that figure to be undertaken by the private sector (including PPP and BOT projects) The Th cu
Slide 18: Kuwait Operations: Focused business lines
Kuwait Operations Focused business lines NBK is a universal bank and the industry leader in all key business segments in Kuwait with a dominant Kuwaiti market share in excess of 30% in all business sectors Retail banking Overview and strategy Corporate Banking Retail Banking Private Banking NBK is
Slide 19: Strategy overview: Regional and international operations
National Bank of Kuwait St t Strategy overview i • Regional and international operations 18
Slide 20: Expansion focused on Middle East and North Africa
Regional and Int’l Expansion focused on Middle East and operations North Africa Expanding our regional footprint and distribution channels in MENA Growing corporate business by targeting int’l and regional co with MENA focus Growing retail banking business leveraging our success in Kuwait Grow
Slide 21: Egypt: A wholly-owned subsidiary in an underserved market (AWB)
Regional and Int’l Egypt: A wholly-owned subsidiary in an operations underserved market (AWB) Total assets (USD m) Successfully transforming banks we acquire 2,719 2 424 2,424 2,293 1,846 NBK acquired AWB in 2007, a medium sized bank with a main focus on SMEs Under NBK management, AWB has underg
Slide 22: Qatar: Establishing a key player in the fastest growing regional economy (IBQ)
Regional and Int’l Qatar: Establishing a key player in the operations fastest growing regional economy (IBQ) Successfully transforming banks we acquire Total assets (USD m) 6,159 6,303 Acquired stake and management control in 2004, NBK 2,960 currently owns 30% of IBQ 1,841 1,281 Transformed from
Slide 23: Other international and regional initiatives
Regional and Int’l Other international and regional operations initiatives Continuing to expand organically Continuing to expand organically Bahrain (1994) International locations a main differentiator Dubai (2008) Present in the Financial Harbor plus one branch in Alseef Opened in August 2008 m
Slide 24: Strategy overview: Islamic Banking (Boubyan)
National Bank of Kuwait St t Strategy overview i • Islamic Banking (Boubyan) 23
Slide 25: Islamic banking opens a new stream of growth for NBK
Islamic Banking Islamic banking opens a new stream of (Boubyan) growth for NBK Islamic banking has been gaining strong grounds in the Islamic banks assets market share Kuwaiti market in recent years, representing one third of assets and deposits as of June 2010 32.1 30 2 29.1% 0.5% 1% NBK comple
Slide 26: Strategy overview: Investment Banking (NBK Capital)
National Bank of Kuwait St t Strategy overview i • Investment Banking (NBK Capital) 25
Slide 27: Choice investment banking provider in Kuwait and the region – NBK Capital
Investment Choice investment banking provider in Banking Kuwait and the region g – NBK Capital p Focused on investment banking activities across the MENA region Dedicated offices in Kuwait, Dubai, Istanbul and Cairo with over 170 professionals Through g its p parent NBK,, NBK Capital p is able
Slide 28: Conclusion: Facing the future with confidence
Conclusion: Facing the future with confidence Financial Unrivaled Network Core Competencies Robustness and Coverage C Dominant market market- Resilient and proven Clear and consistent driven franchise across earnings power strategy formulation Kuwait and execution Depth of experience Diversified ear
Slide 29: Appendix
National Bank of Kuwait Appendix 28
Slide 30: Appendix Financials
Appendix Financials Consolidated Income Statement Historical Balance Sheet USD millions 9M 2009 9M 2010 % change USD millions Dec 2009 Sep2010 % change Net interest income $1,011 $946 (6%) Cash and short term funds $5,704 $3,636 (36%) CBK bonds 990 1 305 1,305 32% Fees and commissions 265 262 (1%) K
Slide 31: Appendix Ratios
Appendix Ratios Sep 2009 Dec 2009 Sep 2010 Performance measures Return on average assets 2.2% 2.2% 2.4% Return on average equity 17.0% 16.5% 16.4% Return on opening equity 18.7% 18.4% 17.6% Net interest margin 3.37% 3.27% 3.07% Other income/ total income 28.7% 27.3% 28.1% Cost income ratio 33.7% 34.
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