Access Holdings Plc · NSENG:ACCESSCORP
Access — FY2022 Earnings Presentation
43 slides from Access's earnings presentation, April 2023
Slide 1: Access Holdings Full Year 2022 Financial and Operating Results Presentation
Access Holdings Full Year 2022 Financial and Operating Results Presentation April 2023
Slide 2: Outline
Outline ❖ Macroeconomic and regulatory update ❖ Strategic update ❖ Financial and operating results ❖ Access Banking Group- Capital & Liquidity Management ❖ Forward Looking Guidance 2
Slide 3: Caution regarding forward-looking statements
Caution regarding forward-looking statements The information presented herein is based on sources which The information should not be interpreted as advice to customers on the purchase or sale of specific Access Holdings Plc. “ the Holding Company” regards as financial instruments. Access Holdings P
Slide 4: A leading global financial institution
A leading global financial institution Our Mission Our Values To build and sustain one global platform, open for anyone to join ❖ Excellence where people can be connected to exceptional opportunities. “Putting in exceptional effort for exceptional results” ❖ Curiosity Our Vision “Never stop question
Slide 5: Macroeconomic & Regulatory update
Macroeconomic & Regulatory update 5
Slide 6: 2022 Global Operating Environment
2022 Global Operating Environment Many economies in Sub-Saharan Africa experienced significant Global Outlook headwinds • Global economy on a tight rope – ongoing global banking crisis (Silicon Valley Bank, Signature Bank, Credit Suisse with a possible trickledown effect on emerging economies includ
Slide 7: Highlights of the Nigerian Domestic Economy in 2022
Highlights of the Nigerian Domestic Economy in 2022 Like other EMDEs*, Nigeria was not immune from the impact of the Russia-Ukraine crisis as inflation especially food and energy prices rose. CBN raised interest rates multiple times to slow down accelerating inflation High inflation due to higher fo
Slide 8: 2022 highlights of the regulatory landscape (Nigeria)
2022 highlights of the regulatory landscape (Nigeria) Pensions Banking • Redesign of the E-Naira by the CBN to control the • Due to the opening of the transfer window, the money supply and aid security agencies in tackling illicit competition in the industry has grown significantly as financial flow
Slide 9: 2022 highlights of the regulatory landscape (African Subsidiaries)
2022 highlights of the regulatory landscape (African Subsidiaries) Ghana: Botswana: • Government of Ghana officially announced in December • The Financial Intelligence Agency(FIA) has advised that 2022 of plans to restructure its debt, on local Botswana will undergo a mutual evaluation by the Financ
Slide 10: Strategic update
Strategic update xO) access Corporation
Slide 11: Access Corporation's Global network and scale
Access Corporation’s Global network and scale Large customer base Growing users on our digital channels Listings 2,894+ ATMs 18.5mn unique 53,164+ POS (Primary equity listing) mobile app and internet banking ($400m Tier II bond) ($300m Senior bond) users B3 12.5mn + USSD B- 633 Branches 200k+ 85% us
Slide 12: A conscious & deliberate ESG strategy at the heart of our business
A conscious & deliberate ESG strategy continues to be at the heart of our business Environment Social Governance $50mn Championed the Coalition Against COVID-19 Launched the Pioneered Reg S Step-Up Green Notes due (CACOVID) implementation sustainability 2027 in the international capital 20,500+ chil
Slide 13: Success across ambition and vision over the past five years (2018-2022)
Access has registered successes across its ambition and vision over the past five years (2018 - 2022) Strategic enablers Access Bank has worked Success Highlights towards its vision By focusing on 6 key strategic priorities Retail banking growth & Retail banking growth and wholesale wholesale bank c
Slide 14: Reorganized to capture new opportunities by transitioning to a HoldCo structure
We have reorganized to capture new opportunities by transitioning to a HoldCo structure The HoldCo consist of 5 subsidiaries; 5 Strategic objectives 1 Value accretion Retail, Consumer Payment & Insurance Asset Agility and scale leverage 2 commercial, lending & switching brokerage management corporat
Slide 15: Access Corporation's footprint will grow significantly in the next strategic period
Access Corporation’s footprint will grow significantly in the next United Kingdom strategic period S&P: AA/A-1+ Moody’s: Aa3 Fitch: AA Nigeria Morocco France Existing markets Egypt Countries of Interest Malta Lebanon China France S&P: AA Moody’s: Aa2 Fitch: AA U.A.E India Niger Hong Kong Senegal Gam
Slide 16: Financial and operating results
Financial and operating results 16
Slide 17: FY'2022 – Resilient financial performance
FY’2022 – Resilient financial performance, 1st financial institution in Nigeria to cross gross revenues of N1trn ₦302.1b 58m+ 6,824 17 Market Cap Customers Employees Markets Gross Earnings Total Assets Shareholders’ Funds ₦1.388trn ₦15.0trn ₦1.2trn +42.8% y/y +27.9% y/y +17.3% y/y Cost to Income Rat
Slide 18: Record earnings, stronger balance sheet and improved efficiency
Access Corporation delivered record earnings, with a stronger balance sheet solid and improved efficiency ₦’million FY 2022 FY 2021 %∆ Gross Earnings 1,387,911 971,885 42.8 Net Interest Income 359,431 301,459 19.2 Sustainable Non-Interest Income 560,646 370,184 51.5 revenue across Operating Expenses
Slide 19: Key Income Statement Metrics
Key Income Statement Metrics – drivers of shareholder value creation Gross Revenue (in Billions) Profit After Tax (in Billions) Net Interest Margin 1,387.9 160.3 152.2 4.9% 4.3% 4.0% 971.9 106.0 764.7 FY'20 FY'21 FY'22 FY'20 FY'21 FY'22 FY'20 FY'21 FY'22 Cost to Income Ratio Return on Average Equity
Slide 20: Key Balance Sheet Metrics
Key Balance Sheet Metrics – challenging but strong growth across key lines Total Assets (in Billions) Customer Deposits (in Billions) Return on Average Assets 15,004 9,251 1.6% 11,732 1.3% 6,955 8,680 5,587 1.1% Dec'20 Dec'21 Dec'22 Dec'20 Dec'21 Dec'22 FY'20 FY'21 FY'22 Net Loans & Advances NPL Rat
Slide 21: Total Assets – increased margin pressure from higher CRR
Total Assets – increased margin pressure from higher CRR , downward impact on ROAE 2,141* • Access Bank restricted deposits with the CBN has grown at 1,466* 1,309* 15,004 a rate of 39% over the past 5 years. This is non-interest 2.1% 849* 1.3% 11,732 generating assets of ₦2.1trn, representing 14% of
Slide 22: Regulatory costs – material growth over the years
Regulatory costs – material growth over the years with significant profitability impact 17% 17% AMCON & NDIC - Regulatory costs • Access Banking Group has consistently paid the 16% 17% 75.0 highest regulatory fees out of all the five Tier 1 16% 16% 16% Banks since 2020.Regulatory fees CAGR 50.0 15%
Slide 23: Diversified growing franchise resilient during turbulent times
Diversified growing franchise that has proven resilient during turbulent times Gross Revenue (₦’bn) • Gross earnings grew c. 43% y/y to c. ₦1.39trn in the period (FY’21: ₦971.9bn), comprising c. 60% of interest income and 40% in non-interest CAGR % income. 1,387.9 +35% p.a. 27.0 • CAGR increase of +
Slide 24: Improved Net Interest Income from stronger loan growth
Improved Net Interest Income from stronger loan growth, higher securities yield, dampened by high Cash Reserve Ratio Interest Income 400 6.0% *+30% p.a. 4.9% 827.3 4.3% 300 359.4 601.7 4.0% 489.2 301.5 200 4.0% 263.0 2.0% 100 FY 2020 FY2021 FY2022 0 0.0% FY 2020 FY2021 FY2022 Interest Expense Net In
Slide 25: Continued focus on better balance sheet mix
Continued focus on better balance sheet mix Customer deposits increased by 33% y/y to ₦9.25trn in Customer Deposits (₦’bn) CAGR, % the period (Dec’21: ₦6.95trn), from the positive impact of our channel optimization strategy on customer acquisition Net Interest Margin (NIM) and deposit mobilization.
Slide 26: Operating expenses growth aligned with inflation & targeted growth
Operating expenses growth aligned with inflation & targeted growth activities • Overall Cost to Income ratio improved by c. 92bps y/y to Operating Expenses (₦’bn), CoR and CIR 57.9% (FY’21: 58.8%) as revenues grew, we doubled down on Operating Expense Cost of Risk Cost to Income cost containment str
Slide 27: Performance by Business Segments
Performance by Business Segments – broad base of profit generation Notes • Sizeable portion of Holding Company costs relates to professional fees incurred for the M&A transactions during the acquisition of the Pensions business, personnel costs and others • Impairment from Ghana domestic & Eurobonds
Slide 28: Access Banking Group – Capital & Liquidity Management
Access Banking Group – Capital & Liquidity Management 28
Slide 29: Commitment to balance sheet strength
…..underpinned by a commitment to balance sheet strength Funding sources (%) Equity 8% 6,291 Other Liabilities 6% Capital and Liquidity (₦’bn) Interest-Bearing 4,892 Borrowings 3,828 9% Dec’22: 50.7% Debt Securities 46.0% 39.5% Issued ₦15.1trn 2% Customer Deposits from Deposits 19.6% 24.5% 20.6% Fin
Slide 30: Access Banking Group – Asset Quality
Access Banking Group – Asset Quality 30
Slide 31: Healthy growth in loan book post pandemic lockdowns
………….healthy growth in loan book post pandemic lockdowns Loans & Advances to customers (₦’bn) Gross Loan Distribution by Sector CAGR, % 5,557 2% 2% 1% Sector Dec’22 Dec’21 +24% p.a. 456 3% General Commerce 12.2% 11.4% 4,446 Oil & Gas - Services 11.4% 14.4% 12% Finance and Insurance 10.7% 8.6% 3,611
Slide 32: Continued improvement in our Assets Quality
Continued improvement in our Assets Quality NPL Distribution by Sector NPL Ratio by Sector Dec’22 Dec’21 Manufacturing - Others 9.6% 13.0% 2% 1% 0% Sector Dec’22 Dec’21 Transportation and Storage 8.8% 9.7% 2% General Commerce 16.5% 17.1% Information and Comm. 8.0% 6.0% Manufacturing - Others 13.1% 1
Slide 33: Access Banking Group – Subsidiaries performance
Access Banking Group – Subsidiaries performance 33
Slide 34: African & International Subsidiaries' Performance
Key takeaways African & International Subsidiaries’ Performance African Subsidiaries PBT • Revenue: ₦206.6bn up 13%y/y (FY’21: Africa Subsidiaries ₦182.8bn) • Impairments: ₦63.2bn up 329% y/y (FY’21: 47.6 ₦14.7bn) • Deposits from customers: ₦1.1trn up 10% y/y 28.5 (FY’21: ₦1.0trn) • Ghana 28%, Botsw
Slide 35: Update on Ghana Sovereign debt situation
Key takeaways Update on Ghana Sovereign debt situation ❖ Impact of Ghana Eurobonds on Access • The Domestic Debt exchange closed on 10th of February. Final Banking Group results from the Ghana’s Ministry of Finance shows participation in the exchange was approximately 85% of eligible holders. • Acce
Slide 36: Subsidiaries' performance dampened by Ghana Sovereign Debt Restructure
Subsidiaries’ performance dampened by Ghana Sovereign Debt Restructure PBT (₦,bn) Subsidiary contribution to PBT : ₦19.1Bn • Subsidiaries’ contribution to the Banking Group’s performance stood at 11% (FY’21: 38%), with a PBT of ₦19.1bn • Access Bank UK and Ghana accounted for 59% of Africa subsidiar
Slide 37: Access Banking Group: Digital Lending
Access Banking Group: Digital Lending 37
Slide 38: Increased scale and velocity of our digital lending
Increased scale and velocity of our digital lending – unlocking strategic value Digital lending count, #,Thousand Digital lending value, ₦’million 32% p.a. -23% p.a. 167,896 3,997 145,860 3,153 2,384 96,919 FY 2020 FY 2021 FY 2022 FY 2020 FY 2021 FY 2022 Products Small Ticket Personal Loans ~₦167.9b
Slide 39: Drove transaction income through enhanced digital channels
Drove transaction income through enhanced digital channels transaction velocity Channels Count FY’22 (mn) Count FY’21 (mn) Count FY’20 (mn) YonY Growth Value ’22 (₦’bn) Value FY’21 (₦’bn) Value FY’20 (₦’bn) YonY Growth Debit/Credit Card 431 419 403 6% 5,974 4,038 3,966 15% POS 41 71 39 2% 1,267 1,68
Slide 40: Forward looking Guidance
Forward looking Guidance xO) access Corporation
Slide 41: Access Corporation: Financial Targets
Access Corporation: Financial Targets Key Takeaways 2023 Targets 2027 Targets Return on Average NIM is expected to be at least 6% in 18% 25-30% Equity 2027, this growth in NIM will be driven Return on Average >2% >2% PROFITABILITY by increased lending within the core Assets Yield on Asset >10% >10%
Slide 42: Conclusion
Conclusion Access Bank over the last twenty years has built a Access Corporation’s ambitions will be supported by 7 key strong financial institution through a disciplined enablers. These enablers will ensure Access executes approach to executing its strategy which has seamlessly, becoming a Top 5 fi
Slide 43: Investor Relations
Access Corporation Investor Relations Contact Information Webpage: https://theaccesscorporation.com/investor-relations/ E-Mail: Investor.Relations@theaccesscorporation.com ©Access Corporation 2022