Saudi National Bank · TADAWUL:1180
Saudi National Bank — Q1 2022 Earnings Presentation
29 slides from Saudi National Bank's earnings presentation, May 12, 2022
Slide 1: 1Q 2022 Earnings Presentation
1Q 2022 Earnings Presentation Saudi National Bank Riyadh | 12 May 2022 SNB | 1Q 2022 | Earnings Presentation
Slide 2: Disclaimer
Disclaimer The Saudi National Bank (SNB) prepared this presentation on a proprietary basis as general background information about the activities of SNB. The information contained herein is given in summary form and for discussion purposes only. Some of the information that is relied upon by SNB is
Slide 3: Pro-forma financial statements
Pro-forma financial statements The pro-forma financial information consists of the unaudited pro-forma condensed consolidated statement of financial position of NCB and Samba (together referred to as ‘‘the Group’ or “SNB”’) as at March 31, 2022 and comparative period, as if the merger has taken plac
Slide 4: 1Q 2022 Performance Highlights
1Q 2022 Performance Highlights Record net income from solid financing growth, margin expansion and lower operating and risk costs, whilst maintaining strong and stable funding Balance sheet expansion… …from solid growth in financing… …as Wholesale financing resumed …and with continued Retail ROA gro
Slide 5: 1Q 2022 Performance Highlights (Continued)
1Q 2022 Performance Highlights (Continued) Synergy realization on track and continued progress on digital convergence Unlocking merger benefits… …with 60% of total targeted cost synergies achieved to date. 1 Realized 1,200 1 Revised Target 720 800 1 of Total Targeted Cost Synergies 720 Original Targ
Slide 6: Balance Sheet Summary
Balance Sheet Summary 1% balance sheet expansion from financing growth, funded mainly from deposits Total Assets (SARbn) Total Assets Movement YTD (SARbn) 914.1 921.6 +1% 85.4 83.9 914.1 1.5 17.0 921.6 495.9 512.9 (9.7) (1.4) 240.5 242.1 92.3 82.6 -10% +1% +3% -2% 4Q 21 1Q 22 4Q 21 Cash & interbank
Slide 7: Financing and Advances
Financing and Advances Strong financing growth in Retail and Wholesale Financing & Advances, Net (SARbn) Financing & Advances, Net Movement YTD (SARbn) 495.9 512.9 2.0 2.0 +3% 16.1 16.4 216.7 223.9 495.9 7.8 1.7 4.3 2.9 0.3 512.9 Retail Wholesale SAR +9.5bn (+4%) SAR +7.2bn (+3%) 261.1 270.6 +7% +1%
Slide 8: Investments
Investments Investments up 1% from Saudi Government Debt Securities and funds & equity Investments (SARbn) Investments Movement YTD (SARbn) 240.5 242.1 20.5 22.2 +1% 58.6 53.8 240.5 1.8 1.4 242.1 (1.7) 161.5 166.2 +1% -2% +7% 1 4Q 21 1Q 22 4Q 21 SGDS Other fixed inc ome Funds & equity 1Q 22 Fixed ra
Slide 9: Deposits
Deposits Healthy CASA growth leading to further funding mix optimization Customers' Deposits (SARbn) Customers' Deposits Movement YTD (SARbn) 586.9 605.0 +3% 21.1 19.0 108.9 Domestic International 110.8 SAR +18.2bn (+3%) SAR -0.2bn (-1%) 586.9 22.6 0.5 605.0 455.1 477.0 (4.4) (0.7) +5% -4% -7% +4% 4
Slide 10: Income Statement Summary
Income Statement Summary Pro-forma net income after Zakat and Tax rose 7% YoY from higher NSCI, lower operating and risk costs; +32% on a reported basis Net Income After Zakat and Income Tax Attributed to Equity Holders Movement YoY (SARmn) +32% +7% 397 292 202 4,548 4,502 392 839 4,247 -127 -230 -1
Slide 11: NSCI & Margin
NSCI & Margin NSCI growth of 7% from higher average earning assets and margin expansion Net Special Commission Income Movement YoY (SARmn) +46% +7% 185 70 238 22 5,883 202 6,085 1,308 5,486 28 4,178 -146 Financing Mix & Yield SAR +67mn +6% -9% +195% +5% +107% -4% 1Q 21 SAMBA 1Q 21 Retail Wholesale O
Slide 12: Fee & Other Income
Fee & Other Income Fee and other income decreased 25% YoY from lower investment-related income Fee and Other Income Movement YoY (SARmn) +28% -25% 1,092 2,633 2 27 114 1,980 1,980 1,541 -797 +0% +7% -50% -39% 1Q 21 SAMBA 1Q 21 Banking FX Inv-related Other 1Q 22 1Q 22 1Q 21 services REPORTED PRO-FORM
Slide 13: Operating Expenses
Operating Expenses 15% improvement in operating expenses driven by realized synergy savings and cost optimization efforts Operating Expenses Movement YoY (SARmn) +55% -15% 1,007 2,569 22 230 19 2,425 2,177 1,562 -101 -42 -271 -8% -24% +8% -30% 1Q 21 SAM BA 1Q 21 Employee- Rent & Deprecia tion & G&A
Slide 14: Financing Credit Impairments & Cost of Risk
Financing Credit Impairments & Cost of Risk Cost of Risk down 28bps to 30bps on lower Corporate impairments Net Impairment Charge for Financing and Advances Movement YoY (SARmn) Cost of Risk (%)1 0 0.58% 0 +11% 0 0.57% 0 0.30% -47% 0 311 0 0.24% 0 0 1Q 21 1Q 22 390 746 Group Group excluding int'l Ne
Slide 15: Credit Quality
Credit Quality Modest NPL growth and solid financing growth leading to NPL ratio improvement Credit Impaired Financing Movement YoY (SARbn) +1% 2.8 10.9 8.0 0.1 0.0 8.1 -0.1 +1% +18% +0% -14% NPLs Retail Corporate Int'l NPLs POCI Credit impaired financing 4Q 21 1Q 22 1Q 22 REPORTED REPORTED REPORTED
Slide 16: Credit Quality (Continued)
Credit Quality (Continued) NPL coverage ratios remain healthy and relatively stable quarter-on-quarter ECL Allowance by Stage (SARmn) Total Financing and Advances, Gross by Stage (SARbn) 10,901 11,230 504.2 521.3 8.0 8.1 18.1 18.8 5,749 5,893 478.0 494.4 2,813 3,017 2,339 2,320 4Q 21 1Q 22 4Q 21 1Q
Slide 17: Capitalization
Capitalization Improvement in capital position during the quarter from solid retained earnings generation Total Capital (SARbn) Total Capital Movement YoY (SARbn) +2% +2% 127.8 130.5 5.4 5.6 12.2 127.8 4.3 0.3 130.5 12.2 -1.9 110.2 112.7 4Q 21 1Q 22 4Q 21 Retained Earnings Other reserves Other 1Q 22
Slide 18: Liquidity
Liquidity Strong liquidity profile maintained Net Stable Funding Ratio (NSFR) (%) SAMA LTD Ratio (%) 1 30 120% 118% 800 .0 1 Regulatory 700 .0 1 ceiling 90% 25 661.4 1 634.9 600 .0 20 500 .0 1 74.5% 75.7% 1 15 400 .0 1 300 .0 10 1 200 .0 1 5 100 .0 1 0 0. 0 1 4Q 21 1Q 22 4Q 21 1Q 22 Availa ble stabl
Slide 19: Outlook and Guidance
Outlook and Guidance Positive guidance revisions for NSCI margin, CIR and Tier 1 CAR due to strong 1Q 2022 financial outcome and more aggressive rate hike outlook Macro-Economic Outlook1 SNB Financial Guidance 2022 Outlook FY 20212 Baseline 1Q 20222 2022 Guidance Oil Price USD 95 to 105 / bbl Financ
Slide 20: zZ s
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Slide 21: Additional Information
Additional Information Write to Us Access Our Investor Disclosures The Saudi National Bank Tower, Unit No. 778 Visit: http://www.alahli.com/en-us/Investor_Relation King Abdullah Financial District to access SNB’s current and previous Investor Publications including: 3208, Al Aqeeq District, King Fah
Slide 22: Appendix
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Slide 23: SNB Overview & Strategy Framework
SNB Overview & Strategy Framework 1Q 2022
Slide 24: SNB Overview
SNB Overview SNB is Saudi Arabia's largest Banking Group with a well-diversified business model, leading client offering, and international presence Our Purpose Our Presence Subsidiaries: Our Performance TFKB (Turkey) Saudi National Bank 316 branches, 556 ATMs Operating Income Net Inc. to equity hol
Slide 25: 2022 Strategy Framework
2022 Strategy Framework SNB will leverage its National Champion status and V2030 opportunities SNB’s group strategic focus areas for 2022: Grow financing & Unlock Maintain Accelerate Foster profitability merger benefits cost & risk discipline digital convergence human capital This translates to spec
Slide 26: PPA Summary
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Slide 27: Summary of fair value adjustments on Samba book value
Summary of fair value adjustments on Samba book value Samba’s adjusted net asset value amounted to SAR 42.8 billion versus the pre-PPA value of SAR 45.7 billion Application of PPA to the NCB-Samba merger PPA Fair Value Adjustments § SNB is required to align the book value of Samba’s assets and liabi
Slide 28: PPA accounting
PPA accounting The bank has completed the PPA exercise within 9 months within IFRS 3 requirements, resulting in final goodwill of SAR 34 billion Transaction perimeter and structure Summary of Changes in Goodwill (SARbn) Intangible assets primarily § On 11 October 2020 , NCB entered into a merger per
Slide 29: Allocation of Goodwill and Intangible assets
Allocation of Goodwill and Intangible assets Goodwill is subject to annual impairment testing and intangible assets are amortized through the income statement Goodwill and Intangibles (SARbn) +SAR 2.7bn 42.9 Intangible assets 40.2 Intangible Assets Breakdown (SARbn) § With the completion of PPA the