Emirates Nbd Bank (p.j.s.c) · DFM:EMIRATESNBD
Emirates Nbd Bank (p.j.s.c) — Emirates NBD — Non-Deal Roadshow (June 2009)
42 slides from Emirates Nbd Bank (p.j.s.c)'s roadshow presentation, June 2009
Slide 1: Emirates NBD UAE Institutional Investor Update
Emirates NBD UAE Institutional Investor Update Rick Pudner Chief Executive Officer Sanjay Uppal Chief Financial Officer June 2009
Slide 2: Forward Looking Statements
Forward Looking Statements It is possible that this presentation could or may contain forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only
Slide 3: UAE Economic Update
UAE Economic Update Comments Real GDP Growth Forecasts* UAE was hit by external shocks including weaker oil 2008 2009 2010 prices, a credit squeeze, and declining world trade UAE 7.4% 0.5% 3.0% UAE’s accumulated surpluses over recent years UK 0.7% -3.5% -0.3% enable it to engage in powerful coun
Slide 4: UAE Banking Market Update
UAE Banking Market Update Comments UAE Banking Sector Growth UAE L&R growth has outstripped deposit growth in recent years Banking Assets AED billion 1,480 UAE Banking system liquidity tightened in 3Q 2008 due to Nominal GDP AED billion Deposits AED billion outflow of c. AED184b of speculative c
Slide 5: 2008 Financial Results
2008 Financial Results Group Performance Comments Key Performance Indicators Full Year 2008 Net Profit down 7% from 2007 Year to Variance AED m 31 Dec 2008 vs. 2007* Cash dividend of 20% and stock dividend of 10% Q4-2008 Net Profit of AED 14m (AED 1.2b in Q4-2007) Net Interest Income 5,834 +43
Slide 6: 1Q 2009 Financial Results
1Q 2009 Financial Results Group Performance Comments Key Performance Indicators Quarter Variance 1Q 2009 Net Profit of AED 1,259m AED m ended vs. 1Q 2008 up 5% from 1Q 2008 of AED 1,196m 31 March up significantly from Q4 2008 Net Profit of AED 14m 2009 Net Interest Income 1,928 +40% Relative
Slide 7: Net Interest Margins and Cost to Income Ratio
1Q 2009 Financial Results Net Interest Margins and Cost to Income Ratio Net Interest Margins Net interest margin (NIM) increased from 2.37% in 4Q 2008 (2.01% in FY 2008) to 2.76% in 1Q 2009 Increase in NIM primarily driven by re-pricing of loans & NIM for the quarter 2.76 and the benefit of proa
Slide 8: Credit Quality
Credit Quality Comments Loan Portfolio by Sector – Q1 2009 Loan portfolio is balanced and well secured Transport & Others Emirates NBD’s credit quality remains healthy across the Manufacturing communication 6% Sovereign Bank’s corporate and retail portfolios 5% 2% 21% Construction Moderate inc
Slide 9: Asset Quality: Real Estate Exposure
Asset Quality Real Estate Exposure Exposures to Real Estate & Construction Sector is 14% and 5% of the WB portfolio respectively Emirates NBD is very selective in financing real estate sector. Extent of finance is generally limited to: Wholesale Bank 70% of construction cost excluding land or
Slide 10: Investments & Trading Securities
Investments & Trading Securities Comments 1Q 2009 MTM Impact Write-downs and impairments reflected a market-wide AED million P&L impact Cumulative Total changes in downturn in 2008. Balance Income Impairm. FV Relative stabilisation of equity and bond markets in first (28) (109) (128) Investment
Slide 11: Investments & Trading Securities (cont'd)
Investments & Trading Securities (cont’d) Composition by Type: Q1 2009* Composition by Category: Q1 2009* Trading Held to securities Government Other Trading Maturity 4% bonds 3% 12% Securities 8% 4% Fair Value Hybrid through instruments P&L 1% 13% Equity 20% Corporate bonds 55% Available for Sale 8
Slide 12: Profit and Balance Sheet growth in recent years
Q1 2009 Financial Results Profit and Balance Sheet growth in recent years Revenues, AED billion Net Profits, AED billion +11% +33% 8.4 7.1 4.0 3.7 4.8 +20% 3.0 +5% 6.2 5.6 3.1 2.5 3.5 2.1 2.6 1. 3 1. 5 2.2 1. 2 1. 2 0.9 0.9 2006 2007* 2008 1Q09 2006 2007* 2008 1Q09 R e v e nue s Net Prof it Assets &
Slide 13: Divisional Performance
Divisional Performance Growth with revenues up 37% in FY08 versus FY 2007 AED b AED m Wholesale Banking Revenue grew 29% from Q108 Loans grew 23% year-on-year and 4% from Q408 +37% 3,648 Deposits grew 10% year-on-year and 15% from Q408 158 165 128 +29% Wholesale banking had another success
Slide 14: Divisional Performance (cont'd)
Divisional Performance (cont’d) Volumes in customer transactions declined in 1Q 2009 in line AED m Global Markets & with slower economic activity and the market’s reduced -18% appetite for risk Treasury Nevertheless, revenues increased by 177% in 1Q 2009 590 295 666 compared to Q4 2008 due to ma
Slide 15: Capital Adequacy
Capital Adequacy Comments Capital Ratios Capital adequacy ratio at 16.2% in Q1 2009 AED b 60 16.2% 18% (Q4 2008: 11.4%) Tier 1 capital increased from 9.4% at Q4 2008 to 9.7% at 50 13.1% 15% 11.4% Q1 2009 as profit generation exceeded the payment of the 13% 40 10.5% 34.5 2008 full year dividend 9
Slide 16: Funding and Liquidity
Funding and Liquidity Comments Loan to Deposit Ratios Liquidity in the UAE Banking system has further improved AED b in 1Q 2009, helped by the various Government initiatives 140% 129% 126% 118% 119% 122% Formal deposit guarantee documentation expected soon 117% 120% Funding remains stable and
Slide 17: Merger Update
Merger Update Integration fully on track We have achieved major milestones during the last year Treasury team-up Mobile and Online Banking Successful Emirates NBD’s together in one premise, integrated; enhanced integration of 92 Large Corporate and are now working as functionalities and 13 ‘Go liv
Slide 18: Merger Update: Synergies
Merger Update Exceeded 2008 full year targets on all revenue, costs & one-off synergies Target Synergies Actual 2008 Synergies AED 346m of recurring annual synergies by the third year post Achieved synergies of AED 235m – ahead of 2008 full year merger, plus AED 26m of one-off synergies totallin
Slide 19: Strategic Imperatives
Strategic Imperatives Prudent lending growth • Support growth of important Group relationships in line with targeted asset/deposit ratios Optimise Focus on funding balance sheet • Renewed focus on key market segments • Leverage distribution network • Continue to maintain and develop wholesale source
Slide 20: Strategic Imperatives: Evidence of success
Strategic Imperatives Evidence of success in Q1 2009: • Capital Adequacy Ratio strengthened to 16.2% from 11.4% at the previous year-end due to conversion of AED 9.3bn of Ministry of Finance deposits to Tier II capital Optimise • Expect to exceed Tier 1 of 11% by end of 2nd quarter balance sheet • R
Slide 21: Outlook
Outlook In 2009 the external environment combined with liquidity tightening and weakening demand should bring GDP growth back towards 0.5% UAE’s accumulated surpluses over recent years enable it to engage in counter-cyclical policies, providing a powerful fiscal stimulus Monetary policy is als
Slide 22: Summary
Summary The UAE economy is expected to slow down but remains relatively well positioned The integration is fully on track and 2008 full year synergy targets were exceeded by 90% 2008 statutory net profit down 7% from 2007, which was significantly impacted by write- downs and impairments on inv
Slide 23: Appendix
Appendix
Slide 24: Contents
Contents Background on Emirates NBD Strategic Priorities Awards and Key Deals 23
Slide 25: Emirates NBD is the largest bank in the UAE and GCC by assets
Emirates NBD is the largest bank in the UAE and GCC by assets UAE ranking by Assets $b UAE ranking by Equity $b UAE ranking by Profits $m Emirates NBD 76.6 Emirates NBD 7.0* Emirates NBD 343 NBAD 43.9 First Gulf Bank 5.5 NBAD 210 ADCB 39.3 NBAD 5.0 First Gulf Bank 204 First Gulf Bank 29.8 ADCB 4.3 M
Slide 26: Emirates NBD Group Structure and Market Shares
Emirates NBD Group Structure and Market Shares Group Structure Group Entities Emirates NBD • Emirates Bank & National Bank of Dubai (Parent Company) are the primary companies of Emirates NBD group Banking Other Financial Brokerage Processing Associates • Provide services and products to Retail, Serv
Slide 27: Building a geographically diversified footprint
Building a geographically diversified footprint London, UK Tehran, Iran Branch (est. 1986) Representative Office (est. 2002) Cairo, Egypt Cards Processing Center - NPC (est. 2007) Mumbai, India Jersey Representative Office Channel Islands (est. 2000) • Branch (est. 1990) • Subsidiary Trust Co. (est.
Slide 28: Strong Credit Ratings
Strong Credit Ratings Current Ratings Moody's¹ • A1 / P-1 • A1 / P-1 S&P² • A / A-1 • A / A-1 Fitch³ • AA- • n/a Capital • AA- • AA- Intelligence 1 Moody’s Long-term rating / Short-term rating 2 S&P Credit ratings on negative ‘credit watch’ 3 EBI’ s Long term Issuer Default rating is AA-; NBD has no
Slide 29: Contents
Contents Background on Emirates NBD Strategic Priorities Awards and Key Deals 28
Slide 30: Optimise Balance Sheet Initiatives
Optimise Balance Sheet Initiatives 1 • Continue to monitor market conditions and investor demand through ongoing dialogue and non-deal specific investor road shows Maintain & develop • Innovative & opportunistic funding and capital initiatives (e.g. Tier 2 wholesale bond conversion, explore securiti
Slide 31: Optimise Balance Sheet Initiatives (cont'd)
Optimise Balance Sheet Initiatives (cont’d) 4 Launch • Build up team and proposition Private – Add relationship managers to drive liability sales Banking – Upgrade existing, qualified bank customers Optimise Balance Sheet – Expand model into neighboring countries 5 Affluent / • Revised value proposi
Slide 32: Drive Profitability Initiatives
Drive Profitability Initiatives 1 • Leverage the recent significant investment in technology and infrastructure to streamline processes and improve productivity – Finacle core banking system Streamline – Oracle Financials – ERP processes – Consolidation of data centres at Al Barsha & productivity –
Slide 33: Drive Profitability Initiatives (cont'd)
Drive Profitability Initiatives (cont’d) 3 Maximise • Product re-pricing across corporate and retail portfolios. product • Shift product mix; e.g. focus on affluent and private banking Drive Profitability yields and customers margins • Proactive balance sheet management to optimise funding costs 4 •
Slide 34: Enhance Risk Management Initiatives
Enhance Risk Management Initiatives 1 • Developed Risk Model Governance Framework, Risk Strategy and comprehensive MIS capability • Development of Basel II Standardized Approach capital calculator for Emirates NBD completed in line with UAE Central Bank • Developed Basel II compliant internal Rating
Slide 35: Enhance Risk Management Initiatives (cont'd)
Enhance Risk Management Initiatives (cont’d) 3 Corporate • Sectoral caps harmonized for all Emirates NBD corporate counterparties • Exposures to all economic sectors being carefully monitored • Prudence in renewing existing facilities • Intensified credit monitoring and controls Enhance risk managem
Slide 36: Contents
Contents Background on Emirates NBD Strategic Priorities Awards and Key Deals 35
Slide 37: 2008 and Q1 2009: Awards
2008 and Q1 2009 : Awards Emirates NBD was honored by H.H. Sheikh Mohamed Bin Rashid Al Maktoum, the Ruler of Dubai and Vice President & Prime Minister of the UAE, for its role in boosting investments and attracting businesses from around the world. Rick Pudner, Chief Executive Officer of Emirat
Slide 38: Large Deals Concluded 2008
…..Large Deals Concluded 2008 February 2008 March 2008 March 2008 March 2008 Emirates Aluminum DEER FIELDS TOWN SQUARE Limitless LLC PROJECT US$225,000,000 revolving multi- USD $ 1.2 Billion (Dual currency US$4,940 Million currency credit facility AED/USD) Project Finance Facility Syndicated Mudarab
Slide 39: Large Deals Concluded 2008 Cont'd
… Large Deals Concluded 2008 Cont’d… June 2008 June 2008 June 2008 July 2008 Dubai World Axiom Telecom LLC The Palm Vacation Club FZE Dubai Aerospace (A Subsidiary of IFA Hotels & Enterprise Limited Resorts KSCC) USD 5,000,000,000 USD 400,000,000 AED 367,300,000 Dual Currency (AED/USD) US$1,000 Mill
Slide 40: Large Deals Concluded 2008 Cont'd
… Large Deals Concluded 2008 Cont’d… August 2008 August 2008 September 2008 October 2008 Drydocks World LLC Commercial Real Estate ENOC Processing Company Investment Corporation of Company KSCC LLC Dubai AED 771 Million US$ 6,000 Million US$ 2,200 Million US$155 Million Islamic Financing Facility Sy
Slide 41: Large Deals Concluded 2009
… Large Deals Concluded 2009 February 2009 February 2009 February 2009 Saudi Bin Ladin Group Ltd Al Ghurair Centre LLC Borse Dubai Limited (Public Buildings & Airports Division) US$347 Million US$2,500 Million SR 3.15 Billion Syndicated Musharaka Syndicated Term Loan Syndicated Project Facility Faci
Slide 42: Contact Details
Contact Details: Ben Franz-Marwick Head, Investor Relations Tel: +971 4 201 2604 Email: bernhardf@emiratesbank.com