Slide 1: Kina Securities Ltd Half Year Results – 30 June 2017
For personal use only Kina Securities Ltd Full year results – December 2016 February 2017 Kina Securities Ltd Half Year Results – 30 June 2017 24th August 2017
Slide 2: Important notice and disclaimer
Important notice and disclaimer For personal use only You must read this notice before reading or making any use of this document or any information contained in this document. By accepting this document, you agree to the following terms and conditions, including any modifications to them. Confident
Slide 3: Corporate Highlights
Corporate Highlights
Slide 4: For personal use only
CIMB appointed Transaction as USD accounts Correspondent increased by 10% For personal use only Bank Loan growth – up 13% from 2H 16 Opened new Vision City outlet Loan market share growth - from 3.7% (1H 16) to 5.6% Trade finance Realignment agreement of deposit based with ADB to from high cost to f
Slide 5: Financial highlights – H1 2017
Financial highlights – H1 2017 For personal use only Statutory NPAT (PGK$m) Underlying Profit (PGK$m) 20.50 20.48 20.5 20.5 10 5.00 5 3.00 H2 2015 H1 2016 H2 2016 H1 2017 H2 2015 H1 2016 H2 2016 H1 2017 Dividend per share 10.2 10.0 8.5 5.0 4.09 3.95 3.40 2.00 H2 2015 H1 2016 H2 2016 H1 2017 Dividend
Slide 6: Financial ratios
Financial ratios For personal use only Net interest margin Loans to deposit ratio 71% 9.3% 69% 8.7% 7.3% 63% H1 2016 H2 2016 H1 2017 H1 2016 H2 2016 H1 2017 Return on Equity (Annualised) (%) Cost to income ratio% 67.8% 16.2% 15.8% Excludes one off 47.5% K7M lease * 48.3% 8.00% termination payment H1
Slide 7: Profitability
Profitability For personal use only 61,700 55,275 49,055 39,029 41,202 * 8,869 34,798 4,459 PGK'000 1,328 2,531 8,725 256 20,499 20,477 33,242 29,800 25,817 3,026 H1 2016 H2 2016 H1 2017 Revenue NPAT Opex Impairment Expense Tax *Does not include K7m loan termination expense 7
Slide 8: Non-interest income
Non-interest income For personal use only Non-interest income excluding FX Income 20.0 18.0 16.0 5.3 14.0 12.0 5.7 5.3 PGKm 10.0 5.0 8.0 6.0 3.5 3.7 4.0 4.0 2.4 2.0 4.1 3.8 2.0 - H1 2016 H2 2016 H1 2017 Other Income Acquisition related income Bank Fees and commissions Fund Administration Investment
Slide 9: Foreign exchange income
Foreign exchange income For personal use only 12.9 7.6 PGKm 1.9 H1 2016 H2 2016 H1 2017 H1 2017 reflects the K10m shortfall compared to H1 2016 due to lack of USD correspondent bank H2 2016 represents a three month shortfall compared to H1 2016 due to closure of USD correspondent bank 9
Slide 10: Expense management
Expense management For personal use only 16.1 14.6 13.8 8.8 PGKm 8.2 6.0 4.7 4.8 3.3 3.5 2.7 2.5 2.3 1.3 0.0 Admin Staff Occupancy Other Operating expenses Impairment expense H1 2016 H2 2016 H1 2017 Expense excludes one off lease termination of PGK 7m 10
Slide 11: Loan book growing
Loan book growing For personal use only 800 6.0% 5.6 698 700 4.8% 28 5.0% 618 600 27 113 105 13 3.7% 4.0% 500 451 13 24 PGKm 400 3.0% 102 15 300 479 412 2.0% 200 241 1.0% 100 6% 69 61 64 0 0.0% H1 2016 H2 2016 H1 2017 Overdraft Term Loans Asset Financing Housing Loan Esi loan Market Share {RHS} Figu
Slide 12: Funding and liquidity profile
Funding and liquidity profile For personal use only H1 2016 H1 2017 > 6 months > 6 months 121 281 PGK $m On Call PGKm On Call 377 3 months 350 71 2 months 3 months 30 71 1 month 2 months 1 month 62 140 96 *Reducing reliance on on-call money 12
Slide 13: Asset quality management
Asset quality management For personal use only % of Gross Loans 4.9% 3.0% 2.7% 2.3% 1.9% 1.8% 1.8% 1.3% 1.1% 0.6% 0.5% 0.5% 0.4% 0.3% 0.0% H1 2016 H2 2016 H1 2017 Loan impairment expense 60 day arrears 90 day arrears Gross non-performing loans Total provision 13
Slide 14: Capital adequacy
Capital adequacy For personal use only Total Risk Based Capital (%) Leverage ratio 38% 17.78% 30% 28% 8.50% 8.23% 12% 6% H1 2016 H2 2016 H1 2017 H1 2016 H2 2016 H1 2017 Total risk Based capital (T1+T2) Leverage Ratio BPNG Minimum leverage ratio BPNG Minimum Total risk based capital 14
Slide 15: Funds Under Administration (FUA) and Funds Under Management (FUM)
Funds Under Administration (FUA) and Funds Under Management (FUM) For personal use only 10 9.5 9 8 7 6.9 6.2 6 5.4 PGKB 5.6 4.8 5 4.8 4 4.4 3 2 1 0 H1 2014 H1 2015 H1 2016 H1 2017 FUM FUA • FUA boosted by Nasfund transaction (Nasfund onboarded at 1/7/2017) • FUM maintains year-on-year growth 15
Slide 16: For personal use only
For personal use only
Slide 17: Our strategy for growth
For personal use only Our strategy for growth. We will deliver shareholder value and proactively move to lift market share by: at the centre of everything we do 17 together it’s possible kina
Slide 18: For personal use only
For personal use only
Slide 19: PNG – GDP Growth (% per year)
PNG – GDP Growth (% per year) For personal use only Per cent 14.0% 13.3% 12% 12.0% 10.0% 8.1% 8.0% 6.0% 5% 4.0% 2.8% 2.5% 2% 2.0% 0.0% 2012 2013 2014 2015 2016 2017 2018 Source: Asian Development Bank 19
Slide 20: PNG – economic outlook
PNG – economic outlook For personal use only The PNG economy is projected to grow at 2.5% in 2017 and by 2.8% in 2018 (Asian Development Bank) Prices for PNG’s key mineral exports are still trending at low levels, but better than in 2016 FX conditions slightly improving 2017 national elections impac
Slide 21: For personal use only
For personal use only
Slide 22: Operational priorities
Operational priorities For personal use only Kina remains focused on delivering its key operational priorities for 2017. These include: Continued growth of the low cost deposit base. Leveraging our relationships Completing our technology with key superannuation funds transformation including expandi
Slide 23: Financial priorities
Financial priorities For personal use only Net interest margin 7- 9% Cost to income ratio < 50% Loans to deposit ratio < 70% Strong capital position Conservative provisions Good EPS growth 233
Slide 24: The end
For personal use only The end