Ammb Holdings Bhd. · MYX:AMBANK

Ammb Holdings Bhd — Q1 FY2021 Earnings Presentation

43 slides from Ammb Holdings Bhd's earnings presentation, Aug 26, 2020

  1. Slide 1: Q1FY2021 Results Investor Presentation

    Q1FY2021 RESULTS INVESTOR PRESENTATION 26 AUGUST 2020

  2. Slide 2: GCEO Presentation

    GCEO PRESENTATION Dato’ Sulaiman Mohd Tahir 3 Q1FY21 Financial Snapshot 4 Outlook for 2020 5 Loans by Stages

  3. Slide 3: Q1FY21 Financial snapshot

    Financial Snapshot Q1FY21 Financial snapshot Q1FY21 Financials Satisfactory performance in a tough operating environment 1,092 • Underlying income up 8% YoY, excluding net modification loss of Income  3% Q1FY20: 1,065 RM58m 539 Expenses  2% • Keeping a lid on expenses Q1FY20: 529 554 PBP  3% • Ma

  4. Slide 4: Outlook for 2020

    Market Outlook Outlook for 2020 Malaysia GDP Growth Inflation Export growth USD/MYR outlook -3.6% to -5.6% -0.6% to -1.5% -6.5% 4.25 – 4.27 Banking sector Liquidity & Loans growth Asset Quality OPR capital positions Flat to 2.0% Weaker 1.25% to 1.50% Resilient 4 Q1FY2021 Results – Investor Presentat

  5. Slide 5: Loans by stages

    Loans Loans by stages Loans by ECL Stages (RM’ bil) Breakdown by Business Segments (%) Stage 1 Stage 1 Stage 2 Stage 3 WB 89% 100.8 102.0 104.5 107.2 107.4 2% 2% 2% 2% 2% BB 85% 11% 11% 11% 11% 12% RB 85% Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 Stage 2 87% 87% 87% 87% 86% RB 14% 13% BB 9% WB Q1FY20 Q2FY2

  6. Slide 6: GCFO Presentation

    GCFO PRESENTATION Jamie Ling 7 - 22 Financial Overview

  7. Slide 7: Q1FY21 Financial overview

    Financial Overview Q1FY21 Financial overview 1 Capital • Well capitalised with proforma CET1 of 12.8% • Adequate loss absorption capacity (based on credit stress test ranges) • Regulatory reserve of RM382mil 2 Liquidity & Funding • Highly liquid (FHC LCR of 161%, LDR 94.0%) • NSFR for all banking en

  8. Slide 8: Q1FY21 Performance summary – P&L

    Financial Overview Q1FY21 Performance summary – P&L P&L Q1FY21 Q4FY20 QoQ Change Q1FY20 YoY Change (RM’ mil) Total Income 1,092 989  10% 1,065  3% Expenses 539 501  7% 529  2% PBP 554 488  13% 536  3% Net (Recovery) / 50 203  75% (32)  >100% Impairment PATMI 365 248  48% 391  7% Financial

  9. Slide 9: Q1FY21 Performance summary – balance sheet

    Financial Overview Q1FY21 Performance summary – balance sheet Balance Sheet Q1FY21 Q4FY20 YTD Change Q1FY20 YoY Change (RM’ bil) Gross Loans 107.4 107.2   100.8  7% GIL 1.66% 1.73%  7bps 1.66%  LLC1 97.0% 93.4%  360bps 111.5%  1450bps Customer Deposits 114.3 113.0  1% 102.8  11% CASA 30.6 2

  10. Slide 10: Unpacking the normalised items

    Underlying Unpacking the normalised items Normalised P&L (RM’ mil) Q1FY21 Q4FY20 QoQ Change Q1FY20 YoY Change Income - Reported 1,092 989  10% 1,065  3% Net modification loss (58) - - - - Income - Underlying 1,150 989  16% 1,065  8% Expenses - Reported 539 501  7% 529  2% Expenses – Underlying

  11. Slide 11: Movement control order impacted momentum

    Income Movement control order impacted momentum Business Segments Q1FY21 Q4FY20 QoQ Change Q1FY20 YoY Change (RM’ mil) Wholesale Banking 407 284  43% 303  35% Investment Banking 75 81  8% 70  7% Retail Banking 342 354  3% 358  4% Business Banking 80 96  16% 87  7% Group Funding & Others (41)

  12. Slide 12: Positive operating leverage

    PBP & PATMI Positive operating leverage Business Segments Q1FY21 Q4FY20 QoQ Change Q1FY20 YoY Change (RM’ mil) Wholesale Banking 342 202  70% 232  47% Investment Banking 32 33  2% 24  31% Retail Banking 130 129  1% 152  14% Business Banking 47 61  23% 51  9% Group Funding & Others (106) 56 

  13. Slide 13: P&L walk

    Group P&L P&L walk NIM NoII CTI GIL Effective Tax Rate Q1FY21 1.59% 43.8% 49.3% 1.66% 20.1% Q1FY20 1.87% 37.1% 49.7% 1.66% 24.0% YoY Growth    21%  3%  2%  3% >100%  11%  25%  7%  8%  7% 83 2 58 10 35 3 22% 20% 82 391 365 78% 80% Net Interest Non-Interest Total Impairment / RM’ mil Net m

  14. Slide 14: NIM compression from OPR reductions and net mod loss impact

    NIM NIM compression from OPR reductions and net mod loss impact Net Interest Margin (NIM) Movement (QoQ) Assets Funding + Deposits bps NIM movement: QoQ :  36bps 11.9 0.6 YoY :  28bps 1.2 2.9 8.6 0.5 17.1 4.0 14.9 195 174 159 Q4FY20 Wholesale Retail Business Others Asset volume Interbank / Deposit

  15. Slide 15: Strong fixed income trading gains

    NoII Strong fixed income trading gains YoY Growth  39%  >100%  11%  6%  26%  12%  14%  99%  >100%  21% 11 6 1 21 84 2 10 10 18 479 395 Corporate & Investment Group Group Treasury Wealth Business General Life RM’ mil Transaction Banking & Other Retail Funding & NoII & Markets Mgmt Banking I

  16. Slide 16: Continuing cost efficiency drive

    Expenses Continuing cost efficiency drive Business Segments Q1FY21 Q4FY20 QoQ Change Q1FY20 YoY Change (RM’ mil) Wholesale Banking 66 83  21% 70  7% Investment Banking 43 49  12% 45  6% Retail Banking 212 225  6% 206  3% Business Banking 33 35  5% 35  5% Group Funding & Others 65 29  >100%

  17. Slide 17: Stable loan balances

    Loans Stable loan balances Gross Loans Movement (RM’ bil) Breakdown by rate sensitivity: Breakdown by concept: Breakdown by customers type: ROA1: RoTA1: Fixed rate – 22% Islamic – 30% Retail – 55% 0.97% 0.99% Variable rate –78% Conventional – 70% Non-retail – 45% Ex. Auto : YTD Growth  5%  1%  1%

  18. Slide 18: Exercising credit vigilance amid loan moratorium

    Asset Quality Exercising credit vigilance amid loan moratorium Net Impairment (YoY Movement) Gross Impaired Loans, GIL and LLC Ratios Retail Wholesale Loan Loss Coverage 1 RM’ mil Business GIL Ratio 100.5% 114.0% 147.5 93.4% 97.0% 79.7% 1.86% 1.70% 1.59% 1.73% 1.66% 10.3 13.8 RM’ mil 1,853 1,780 74.

  19. Slide 19: Monitoring early alert exposures

    Asset Quality Monitoring early alert exposures Impaired Loans by Sector Loans by Internal Risk Grade Jun’20 Mar’20 Strong ~ Very Strong Satisfactory ~ Moderate Marginal ~ Substandard Impaired Sector Composition YTD Growth 2% RM’ mil RM’mil Agriculture 85 5% 85   RM’ bil Mining and quarrying 53 3%

  20. Slide 20: Highly liquid, CASA mix higher

    Deposits Highly liquid, CASA mix higher Deposits (RM’ bil) CASA (RM’ bil) and CASA Composition (%) Customer Deposits Trend YTD Growth Industry CASA Trend YTD Growth Industry Q1FY21 114.3  1%  3%1 Q1FY21 30.6  6%  7%1 FY20 113.0  6%  2%2 FY20 28.8  16%  10%2 FY19 106.9  12%  5%2 FY19 24.9 

  21. Slide 21: Strong capital and liquidity positions

    Capital Strong capital and liquidity positions RWA/Total Assets Capital Adequacy Ratios3 RM’ bil Total Assets RWA/Total Assets Peers 1 CET 1 Tier 1 Total CAR 2 72.2% 72.2% FHC 65.0% 2 64.4% 2 66.8% 2 16.3% 15.8% 15.9% 15.4% 59.5% 59.3% 58.4% 58.5% 12.5% 13.6% 57.9% 11.9% 5 12.4% 5 12.5% 5 158.8 169.

  22. Slide 22: Thank You

    Thank You

  23. Slide 23: Yearly performance

    Q1FY21 Results Yearly performance PATMI (RM’ mil) & ROE (%) Total Income (RM’ mil) and Non-interest Income (%) PATMI: ROE: Total Income Total Income Non-interest Income % PATMI ROE (%) CAGR FY17-FY20:  0.4% CAGR FY17-FY20:  0.4% CAGR FY17-FY20:  3.9% YoY Growth  6.7% YoY Growth  1.1% YoY Growth

  24. Slide 24: Non-interest income and PATMI mix

    NoII & PATMI Non-interest income and PATMI mix Non-interest Income by Lines of Business (YoY) PATMI by Lines of Business (YoY)  39% Corporate Banking 6%  >100%  1% Group Retail Funding1 & Banking Others 20% Group -25%  >100% Wholesale Treasury &  19% Insurance Market  13% Banking 41% 26% Insur

  25. Slide 25: Impairments

    Asset Quality Impairments Net Impairment / (Writebacks) and GIL Ratio Total impairments by category (RM’ mil) Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 QoQ Change YoY Change ECL Stage 1 & 2 / CP – Non defaulted1 (128) (38) (29) 116 31  73%  >100% ECL Stage 3 / CP – Defaulted 163 182 132 116 89  23%  45

  26. Slide 26: Loans by sector vs industry

    Loans Loans by sector vs industry AmBank Group (RM’ bil) Loans Composition 2% 3% 12% 1% 4% 7% 3% 6% 7% 2% 53% ≈ 100% YTD Growth  7%  16%  3%  17%  5%  1%  1%  3%  1% ≈  1%  4% ≈ Jun-20 107.4 56.8 2.7 4.5 7.7 2.7 6.1 7.7 2.9 13.3 0.8 2.2 0.1 Wholesale, Finance, Mining & Electricity, Tran

  27. Slide 27: Divisional Performance

    Divisional Performance

  28. Slide 28: Wholesale Banking

    Wholesale Banking Wholesale Banking Total Income (YoY Movement) and Total Assets by Line of Business PAT Trend (RM’ mil) QoQ Growth:  67% YoY Growth:  4% Total Income RM407 mil 269 259  18% 188 165 161 Transaction Banking 16% Wholesale Transaction Banking  14% Banking Coverage 7% 28% Q1FY20 Q2FY

  29. Slide 29: Wholesale Banking

    Wholesale Banking Wholesale Banking Income Statement YoY Growth  17%  79%  35%  7%  47%  95%  2%  3%  4% Net Interest Non-Interest RM' mil Total Income Expenses PBP Impairment PBT Tax PAT Income Income Q1FY21 257 150 407 66 342 (5) 347 78 269 Q1FY20 219 84 303 70 232 (106) 339 80 259 Q1FY21

  30. Slide 30: Investment Banking

    Investment Banking Investment Banking League Table Market Share of Value and Volume Traded on Bursa (KLSE)1 Market Share1 As At Trading Value Trading Volume Rank2 30 Jun 2020(%) 3.8% DCM (Overall MYR Bonds) 12.2% 4 3.6% 3.6% 3.5% 3.4% Islamic Sukuk 16.1% 3 5.5% 5.0% Unit Trust 8.1% 5 4.9% 4.8% 4.

  31. Slide 31: Investment Banking

    Investment Banking Investment Banking Income Statement YoY Growth  11%  11%  7%  6%  31%  >100%  35%  32%  36% Net Interest Non-Interest RM' mil Total Income Expenses PBP Impairment PBT Tax PAT Income Income Q1FY21 11 64 75 43 32 (1) 34 7 27 Q1FY20 12 58 70 45 24 (0) 25 5 19 Q1FY21 PAT Q1FY

  32. Slide 32: Retail Banking

    Retail Banking Retail Banking Total Income (YoY Movement) and Loans by Line of Business PAT Trend (RM’ mil) QoQ Growth:  8% Total Income YoY Growth:  1% RM342 mil  29% Retail SME  6%  6% 11% Auto 92 15% 86 Wealth 6% Others Retail 6% 71 SME 71 Cards 7% Auto 21% 66 4% Mortgage 12%  16% Total loa

  33. Slide 33: Cards in circulation

    Retail Banking Retail Banking Wealth Sales (RM’ mil) Merchant Volume QoQ Growth:  3% Merchant volume (RM'mil) QoQ Growth:  29% YoY Growth:  36% YoY Growth:  24% Merchants in force ('000) QoQ Growth: ≈ YoY Growth:  4% 37 36 36 35 35 958 990 2,553 2,594 883 2,473 817 2,323 798 1,646 Q1FY20 Q2FY20

  34. Slide 34: Retail Banking

    Retail Banking Retail Banking Income Statement YoY Growth  2%  15%  4%  3%  14%  38%  1%  2%  1% Net Interest Non-Interest RM' mil Total Income Expenses PBP Impairment PBT Tax PAT Income Income Q1FY21 291 51 342 212 130 36 94 23 71 Q1FY20 298 60 358 206 152 59 93 22 71 Q1FY21 PAT Q1FY20 PAT

  35. Slide 35: Distribution Channels

    Retail Banking Distribution Channels Regional Branches ATM CRM2 Offices Perlis 1 3 1 Kedah 6 19 6 Pulau Pinang 14 42 15 2 Perak 18 40 21 2 Selangor 36 177 41 2 Kuala Lumpur 23 79 25 3 Putrajaya 1 4 2 Negeri Sembilan 7 38 8 1 Melaka 6 26 8 1 Johor 21 69 30 1 Pahang 8 21 11 1 Population Density Tereng

  36. Slide 36: Business Banking

    Business Banking Business Banking Gross Loans (RM’ mil) PAT Trend (RM’ mil) QoQ Growth:  39% YTD Growth:  2% YoY Growth:  5% Non-trade Trade 11,248 11,420 10,850 10,069 10,425 2,640 2,647 2,585 2,462 2,527 8,264 8,607 8,774 7,607 7,898 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 Customer Deposits (RM’ mil

  37. Slide 37: Business Banking

    Business Banking Business Banking Income Statement YoY Growth  6%  12%  7%  5%  9%  51%  6%  10%  5% Net Interest Non-Interest RM' mil Total Income Expenses PBP Impairment PBT Tax PAT Income Income Q1FY21 62 18 80 33 47 7 40 9 30 Q1FY20 66 20 87 35 51 14 38 9 29 Q1FY21 PAT Q1FY20 PAT Positi

  38. Slide 38: Islamic Banking

    Islamic Banking Islamic Banking Income Statement YoY Growth  8%  3%  11%  4%  16%  16%  16% RM' mil Total Income Expenses PBP Impairment PBT Tax & Zakat PATZ Q1FY21 198 73 124 32 92 20 72 Q1FY20 216 75 140 31 109 24 85 Q1FY21 PATZ Q1FY20 PATZ Positive growth in Q1FY21 Contraction in Q1FY21 Ba

  39. Slide 39: General Insurance

    General Insurance General Insurance Loss Ratio and Combined Ratio PBT and PAT (RM’ mil) Loss Ratio Combined Ratio 97% 100% 92% 92% 93% 91% YoY PBT Growth:  14% YoY PAT Growth:  8% 282 63% 57% 58% 60% 56% 54% 260 242 FY17 FY18 FY19 FY20 Q1FY20 Q1FY21 192 Gross Premium Mix and Growth (RM’ mil) YoY G

  40. Slide 40: Insurance and Group Funding & Others

    Insurance & Others Insurance and Group Funding & Others Income Statement – Insurance (General, Life & Takaful) YoY Growth  16%  42%  4%  12%  4%  42%  4% RM'mil Total Income Expenses PBP Impairment PBT Tax PAT Q1FY21 229 120 109 2 107 11 96 Q1FY20 198 85 113 2 111 18 92 Income Statement – Gro

  41. Slide 41: Shareholding structure AMMB Holdings Berhad

    Corporate Structure Shareholding structure 23.8%1 AmCorp 13.0% EPF 10.6% PNB 9.1%2 Others 43.5% As at 30 June 2020 AMMB Holdings Berhad Retail Banking Wholesale Banking Islamic Banking General Insurance Life Assurance & Takaful 100% AMAB Holdings Sdn Bhd 100% AmBank (M) Berhad 51% AmGeneral Holdings

  42. Slide 42: Credit ratings, target price and recommendations

    Ratings & Target Price Credit ratings, target price and recommendations Credit Ratings Q1FY21 AMMB AmBank (M) AmBank Islamic AmInvestment Ratings RAM LT: AA2, ST: P1 LT: AA2, ST: P1 LT: AA2, ST: P1 LT: AA2, ST: P1 Outlook: Stable Outlook: Stable Outlook: Stable Outlook: Stable S&P LT: BBB+, ST: A-2

  43. Slide 43: Glossary & Disclaimer

    Glossary & Disclaimer Glossary & Disclaimer of warranty and limitation of liability Reported Performance Reported performance refers to the financial performance as reported in the audited financial statements and disclosed to the market Growth Definition QoQ/YTD growth refers to Q1FY21 vs Q4FY20 Yo

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