Abu Dhabi Commercial Bank · ADX:ADCB
Abu Dhabi Commercial Bank — FY2024 Earnings Presentation
33 slides from Abu Dhabi Commercial Bank's earnings presentation, January 2025
Slide 1: Fourth quarter and full year 2024 Earnings Presentation
ABU DHABI COMMERCIAL BANK PJSC adcb.com/ir Fourth quarter and full year 2024 Earnings presentation January 2025 Fourth Quarter and Full Year 2024 Earnings Presentation
Slide 2: Disclaimer
Disclaimer This presentation is not an offer or solicitation of an offer to buy or sell securities. It is solely for use as an investor presentation and is provided as information only. This presentation does not contain all of the information that is material to an investor. By reading the presenta
Slide 3: Table of contents
Table of contents 1. ADCB 5-year journey 4 2. Financial highlights 7 3. Digital & ESG highlights 23 4. Operating environment 26 5. Summary 28 6. Appendix 30 Fourth Quarter and Full Year 2024 Earnings Presentation
Slide 4: 1. ADCB 5-year journey
1. ADCB 5-year journey Fourth Quarter and Full Year 2024 Earnings Presentation
Slide 5: ADCB 5-year journey: key financial metrics
ADCB 5-YEAR JOURNEY ADCB 5-year journey: key financial metrics Balance sheet of AED 653 bn, reflecting robust growth in loans & deposits AED 10 bn milestone reached one year ahead of internal target Robust capital ratios (AED bn) 7.3% 9.9% 11.7% 13.6% 15.3% 16.61% 15.97% 15.77% 16.22% 16.13% 411 440
Slide 6: ADCB 5-year journey: key non-financial metrics
ADCB 5-YEAR JOURNEY ADCB 5-year journey: key non-financial metrics Record level of digitally onboarded retail customers Service excellence – NPS scores (2) 83% 83% 76% 78% 69% 52 66 69 73 77 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 Accelerated digital transformation strategy resulting in in
Slide 7: 2. Financial highlights
2. Financial highlights Fourth Quarter and Full Year 2024 Earnings Presentation
Slide 8: FY'24 profit before tax exceeds AED 10 bn milestone driven by strong broad-based growth
FINANCIAL HIGHLIGHTS FY’24 profit before tax exceeds AED 10 bn milestone driven by strong broad-based growth supported by a vibrant UAE economy Key highlights FY’24 key highlights • ADCB surpassed AED 10 bn profit before tax internal target, • Customer deposits increased 16% YoY (AED 58 bn) to Diver
Slide 9: The Bank has delivered on its key FY'24 guidance metrics and embarked on a new strategy
FINANCIAL HIGHLIGHTS The Bank has delivered on its key FY’24 guidance metrics and embarked on a new strategy FY’24 actual vs. guidance FY’24 guidance FY’24 actual Loan growth 16%–17% 16% Net interest income growth c.8% 7% NIM c.2.55% 2.58% Cost of risk(1) <55 bps 58 bps ROATE 14%–15% 15.2% CET1 rati
Slide 10: Ambitious targets set by the new five-year strategy
FINANCIAL HIGHLIGHTS: 5-YEAR STRATEGY & GUIDANCE Ambitious targets set by the new five-year strategy New strategy ADCB has announced a new five-year strategy establishing a clear roadmap for the accelerated growth of core businesses to create significant value for shareholders. The Bank’s guidance f
Slide 11: FY'24 profit before tax up 26% and ROATE of 15.2%
FINANCIAL HIGHLIGHTS FY’24 profit before tax up 26% and ROATE of 15.2%, at the upper- end of guidance, driven by double-digit growth in operating profit Income statement (AED mn) FY’24 FY’23 ∆YoY Strong FY’24 financial performance (AED bn) Total net interest income(1) 13,226 12,374 7% Profit before
Slide 12: 14 consecutive quarters of growth; Q4'24 profit before tax up 15% YoY
FINANCIAL HIGHLIGHTS 14 consecutive quarters of growth; Q4’24 profit before tax up 15% YoY and ROATE of 16.6% Income statement (AED mn) Q4’24 Q3’24 Q4’23 ∆QoQ ∆YoY Q4’24 profit before tax (AED bn) Total net interest income(1) 3,505 3,144 3,413 11% 3% 2.884 +15% YoY +8% QoQ 14 quarters of consecutive
Slide 13: Steady FY'24 risk adjusted NIM, Q4'24 NIM up 17 bps QoQ
FINANCIAL HIGHLIGHTS Steady FY’24 risk adjusted NIM, while Q4’24 NIM increased 17 bps QoQ on lower benchmark rates and inflow of CASA deposits Net interest income (AED mn) Asset yield (%)(1)(2) Key highlights FY’23 FY’24 • The Bank continued to target high-quality, low-risk credit +3% +7% counterpar
Slide 14: Well diversified growth with FY'24 non-interest income up 39%
FINANCIAL HIGHLIGHTS Well diversified growth with FY’24 non- interest income up 39%, representing 32% of total operating income vs 27% in FY’23 Non-interest income (AED mn) Q4’24 Q3’24 Q4’23 ΔQoQ ΔYoY FY’24 FY’23 ΔYoY Key highlights (17%) 25% 3,101 27% • FY’24 net fees and commission income up 27% p
Slide 15: FY'24 cost to income ratio improved 130 bps
FINANCIAL HIGHLIGHTS FY’24 cost to income ratio improved 130 bps driven by enhanced efficiencies and disciplined cost management Operating expenses (AED mn) Cost to income ratio Key highlights • FY’24 cost to income ratio improved by 130 bps YoY driven by disciplined cost management and strong opera
Slide 16: Strong market position driving significant balance sheet growth
FINANCIAL HIGHLIGHTS Strong market position driving significant balance sheet growth, with assets surpassing AED 650 billion milestone Balance sheet (AED mn) Dec’24 Sep’24 Dec’23 ΔQoQ ΔYoY CET1 ratio CAR 12.56% 16.13% Post Total assets 652,814 638,754 567,194 2% 15% Post 16.68% proposed proposed div
Slide 17: Loan growth of 16% YoY, with GREs accounting for 42% of gross loan growth
FINANCIAL HIGHLIGHTS Loan growth of 16% YoY, with GREs accounting for 42% of gross loan growth in FY’24 Net loans(1) (AED bn) Gross loans by geography(1) (AED bn) Key highlights • Well-balanced growth across diverse sectors, including 354 360 344 351 government & public sector, financial institution
Slide 18: Highly rated portfolio of investment securities increased 11% YoY to AED 143 bn
FINANCIAL HIGHLIGHTS Highly rated portfolio of investment securities increased 11% YoY to AED 143 bn, with 99% being invested in bonds Investment securities (AED mn) Investment securities: AED 142,989 mn(2) Key highlights Domestic 33% Government 66% • Investment securities increased 11% YoY +11% Oth
Slide 19: Strong franchise driving 16% growth in customer deposits in FY'24
FINANCIAL HIGHLIGHTS Strong franchise driving 16% growth in customer deposits in FY’24, with significant AED 16.45 bn inflow of CASA deposits in Q4’24 Liability mix Customer deposits (AED bn) CASA split by business (AED bn) Customer deposits 73% 421 407 Total Contribution to Borrowings 15% 363 237 2
Slide 20: Strong capital position supported by earnings growth and efficient capital deployment
FINANCIAL HIGHLIGHTS Strong capital position supported by earnings growth and efficient capital deployment Capital adequacy ratio walkthrough (%)(1) 2.19 0.50 16.22 16.13 1.13 (1.00) (0.38) (0.94) (0.12) (0.34) 1.54 2.23 2.03 12.86 12.56 31-Dec-23 FY’24 net profit Proposed dividend Impact of changes
Slide 21: Improved asset quality metrics with NPL ratio at lowest level over five years
FINANCIAL HIGHLIGHTS Improved asset quality metrics with NPL ratio at lowest level over the last five years Cost of risk Non-performing loans(1) (AED mn) POCI assets (AED mn) and NPL ratio and NPL ratio including POCI FY’23 FY’24 3.73% 3.45% 3.04% 4.20% 3.69% 3.28% Impairment charge: AED 3,477 mn Im
Slide 22: Update on key subsidiaries: Al Hilal Bank and ADCB Egypt
FINANCIAL HIGHLIGHTS Update on key subsidiaries: Al Hilal Bank implements transformational growth strategy, while ADCB Egypt’s net profit doubles Egypt • Led by newly appointed Chief Executive • ADCB Egypt delivered a strong financial Officer Jamal Al Awadhi, Al Hilal Bank is performance capitalisin
Slide 23: 3. Digital & ESG highlights
3. Digital & ESG highlights Fourth Quarter and Full Year 2024 Earnings Presentation
Slide 24: Digital transformation driving customer growth and engagement
DIGITAL & ESG HIGHLIGHTS Digital transformation driving customer growth and engagement, while AI strategy and early ‘use cases’ support productivity gains Digital impact on businesses Digital transformation and AI initiatives Q4’24 digital highlights(1) • Digital channels accounted for 83% of the 74
Slide 25: ADCB included in FTSE4Good Index Series; MSCI ESG rating upgrade to 'AA'
DIGITAL & ESG HIGHLIGHTS ADCB included in FTSE4Good Index Series; MSCI ESG rating upgrade to ‘AA’ and ‘industry leader’ category • Added to the ‘FTSE4Good Index Series’ placing ADCB above the ADCB ranks one of the highest by MSCI and Sustainalytics Surpassed our interim sustainable finance target gl
Slide 26: 4. Operating environment
4. Operating environment Fourth Quarter and Full Year 2024 Earnings Presentation
Slide 27: Strong UAE macro economic fundamentals supporting positive business and consumer confidence
OPERATING ENVIRONMENT Strong UAE macro economic fundamentals supporting positive business and consumer confidence Global: Further interest rate cuts priced in by the US: Probability of a recession has diminished following UAE: Oil price at a comfortable level for the UAE; Output market, significant
Slide 28: 5. Summary
5. Summary Fourth Quarter and Full Year 2024 Earnings Presentation
Slide 29: Continued trajectory of accelerated growth
SUMMARY Continued trajectory of accelerated growth • Delivered on key FY’24 guidance metrics • New board endorsed strategy sets ambitious targets for the next 5 years • Focus on accelerated growth of core businesses, complemented by investment in high potential opportunities • Digital and AI represe
Slide 30: 6. Appendix
6. Appendix Fourth Quarter and Full Year 2024 Earnings Presentation
Slide 31: Balance sheet as at 31 December 2024
APPENDIX Balance sheet as at 31 December 2024 AED mn Dec’24 Dec’23 ΔYoY Cash and balances with Central banks, net 46,223 45,375 2% Deposits and balances due from banks, net 50,214 37,625 33% Financial assets at fair value through profit or loss 12,870 10,063 28% Derivative financial instruments 18,9
Slide 32: Income statement for full year ended 31 December 2024
APPENDIX Income statement for full year ended 31 December 2024 Quarterly trend Full-year trend AED mn Q4’24 Q4’23 ΔYoY FY’24 FY’23 ΔYoY Interest and income from Islamic financing 8,723 8,054 8% 33,734 28,251 19% Interest expense and profit distribution (5,218) (4,641) 12% (20,508) (15,877) 29% Net i
Slide 33: ADCB Investor Relations
ADCB Investor Relations Contact information Click to view our reports For more information, please visit adcb.com/ir 2023 Annual Report or contact ADCB Investor Relations at ir@adcb.com adcb.com/annualreport 2023 Corporate 2023 ESG Report Governance Report adcb.com/esgreport adcb.com/cgreport Fourth
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