Slide 1: Emirates NBD Investor Presentation
Emirates NBD Investor Presentation May 2017
Slide 2: Important Information
2 Important Information Disclaimer The material in this presentation is general background information about the activities of Emirates NBD Bank PJSC (Emirates NBD), current at the date of this presentation, and believed by Emirates NBD to be accurate and true. It is information given in summary for
Slide 3: UAE Economic Update
3 Operating Environment UAE Economic Update Highlights Real GDP growth forecasts • We expect growth to improve to 3.4% in 2017 as higher oil prices 2014 2015 2016E 2017F 2018F contribute to improved consumer and business sentiment and S. Arabia 3.6 3.4 1.4 1.8 2.5 facilitate higher slightly higher g
Slide 4: Dubai Economic Update (1/3)
4 Operating Environment Dubai Economic Update (1/3) Highlights Composition of Dubai GDP • The Emirates NBD Dubai Economy Tracker Index rose to 57.7 in Dubai GDP by Sector (%) - Q3 2016 April from 56.6 in March, signaling the fastest rate of growth since Other Trade February 2015. Output and new orde
Slide 5: Dubai Economic Update (2/3)
5 Operating Environment Dubai Economic Update (2/3) Highlights Dubai Airports passenger traffic • Passenger traffic at the Dubai International Airport (DXB) rose to 25 700 22.5 million in Q1 2017, up by 7.4% y/y. 650 20 600 • Passenger traffic is expected to exceed 89 million at DXB by the 550 end o
Slide 6: Dubai Economic Update (3/3)
6 Operating Environment Dubai Economic Update (3/3) Highlights Dubai residential yield • Dubai real estate prices eased at a slower rate in Apr-17 compared 8.4 5.4 to Apr-16, with apartment and villa prices down 4.0% y/y and 11.3% 5.2 y/y respectively. Low-priced segments fared better than the luxur
Slide 7: UAE Banking Market Update
7 Operating Environment UAE Banking Market Update Highlights Bank deposit and loan growth • Money supply (M2) accelerated to 4.4% y/y in March from 4.2% y/y Bank Loans (% y/y) Bank deposits (% y/y) AD ratio (RHS) in February 2017. 18% 110% 16% 105% • Bank deposits rose AED 20.6bn in the first three
Slide 8: Emirates NBD at a glance
8 Operating Environment Emirates NBD at a glance A leading bank in the region Largest branch network in the UAE Ras al-Khaimah (5) • Market share in the UAE (as at 31 March 2017) Dubai 101 Abu Dhabi 26 - Assets 17.1%; Loans 20.0%; Deposits 19.9% Sharjah 18 Umm al-Quwain (2) Other Emirates 12 Fujaira
Slide 9: Emirates NBD is the regional leader in digital innovation
9 Operating Environment Emirates NBD is the regional leader in digital innovation 2012 2015 Introduced Direct Remit to Introduced New Pakistan Remit to ENBD Pay Dynamic IVR Pak in just 60 secs NFC based mobile contactless payment service Introduced Inaugurated Started Direct Remit to FutureLab multi
Slide 10: Emirates NBD is one of the largest banks in the GCC
10 Operating Environment Emirates NBD is one of the largest banks in the GCC x% 2016 vs. 2015 Operating Income Net Profit * Loans Total Deposits USD Bn, 2016 USD Bn, 2016 USD Bn, 2016 USD Bn, 2016 Emirates NBD Profile 6.3 45% 3.4 10% 143 34% 139 28% 4.9 6% 7% 2.5 3% 79 85 8% Financial & Operating Pe
Slide 11: Profit and Balance Sheet Growth in Recent Years
11 Operating Environment Profit and Balance Sheet Growth in Recent Years Revenues and Costs (AED Bn) Profits (AED Bn) Revenues Costs Pre-Provision Operating Profits Net Profits +10% +11% +7% +30% 7.1 14.4 15.2 14.7 4.9 10.1 10.5 7.2 Emirates NBD Profile 4.7 9.9 4.2 4.4 11.9 3.8 10.2 7.7 5.1 6.5 11.1
Slide 12: Emirates NBD delivered a solid set of results in Q1-17
12 Operating Environment Emirates NBD delivered a solid set of results in Q1-17 amid a challenging environment Q1 2017 at a glance 2017 Macro themes Q1 2017 vs. Regional Global 2017 guidance • Resilience of UAE • Emirates NBD’s Emirates NBD Profile Profitability Net profit AED 1.87 Bn economy balanc
Slide 13: Q1-17 Financial Results Highlights
13 Operating Environment Q1-17 Financial Results Highlights Highlights Key Performance Indicators Better / Better / • Net profit of AED 1,873 Mn for Q1-17 increased 1% AED Mn Q1-17 Q1-16 Q4-16 (Worse) (Worse) q-o-q and 4% y-o-y Net interest income 2,486 2,555 (3%) 2,460 1% Emirates NBD Profile • Net
Slide 14: Net Interest Income
14 Operating Environment Net Interest Income Highlights Net Interest Margin (%) • NIMs improved 4 bps q-o-q as rate rises flowed into loan yields and 2.95 2.91 2.90 funding pressures receded but tightened by 29 bps y-o-y on higher 2.83 2.85 2.83 2.80 2.85 funding costs 2.78 2.90 • Loan yields improv
Slide 15: Non-Interest Income
15 Operating Environment Non-Interest Income Highlights Composition of Non Interest Income (AED Mn) • Core gross fee income increased 27% q-o-q and 7% Better / Better / AED Mn Q1-17 Q1-16 Q4-16 y-o-y on account of higher income from forex and (Worse) (Worse) rates Emirates NBD Profile Core gross fee
Slide 16: Operating Costs and Efficiency
16 Operating Environment Operating Costs and Efficiency Highlights Cost to Income Ratio (%) • In Q1-17, costs improved by 7% q-o-q and 11% y-o- 33.7 34.5 y, helped by a containment in staff costs, following 32.6 cost control measures implemented in 2016 Emirates NBD Profile 32.0 33.1 • Cost-to-Incom
Slide 17: Credit Quality
17 Operating Environment Credit Quality Highlights Impaired Loan & Coverage Ratios (%) 118.5 120.8 120.1 122.5 • NPL ratio improved to 6.3% 111.5 113.5 99.6 • Impaired loans improved to AED 20.1 Bn during the quarter helped by AED 364 Mn of write backs & recoveries in Q1-17 76.1 66.2 Emirates NBD Pr
Slide 18: Capital Adequacy
18 Operating Environment Capital Adequacy Highlights Capitalisation • In Q1-17, Tier 1 ratio decreased by 0.9% to 17.8% and CAR 20.5 21.2 20.3 20.5 20.2 decreased by 1.0% to 20.2% due to: 17.6 17.9 17.8 - Annual dividend payment exceeding Q1-17 retained profit 18.0 18.7 - Marginal increase in credit
Slide 19: Funding and Liquidity
19 Operating Environment Funding and Liquidity Highlights Advances to Deposit (AD) Ratio (%) • AD ratio of 92.5% comfortably within 90-100% management target 118.5 range and demonstrates healthy liquidity position • Liquid assets* of AED 62.6 Bn as at Q1-17 (15.7% of total liabilities) • Debt & Suku
Slide 20: Loan and Deposit Trends
20 Operating Environment Loan and Deposit Trends Highlights Trend in Gross Loans by Type (AED Bn) +6% • Gross loans grew 2% since end 2016 with good growth in Corporate lending 320 +2% 310 314 315 303 • Corporate lending grew 2% since end 2016 due to 294 Emirates NBD Profile 279 285 growth in real e
Slide 21: Loan Composition
21 Operating Environment Loan Composition Total Gross Loans (AED 320 bn) Corporate Loans (AED 100 bn) Treasury/Other Cont. Corporate Trans. & com. Retail 7% 100 3% 35 (31%) RE (11%) 0 Trade 33% Emirates NBD Profile (0%) 15% 8% 52 Manuf. 1% 133 (16%) 4% Islamic* Others** (42%) 4% Per. - Corp. 24% Sov
Slide 22: Divisional Performance: Retail Banking & Wealth Management
22 Operating Environment Divisional Performance • RBWM revenues increased 3% q-o-q and 10% y-o-y Balance Sheet Trends Revenue Trends • In Q1-17, fee income grew 5% y-o-y and accounted for AED Bn +5% AED Mn Wealth Management 37% of total RBWM revenue +2% +3% Retail Banking & Emirates NBD Profile • Lo
Slide 23: Divisional Performance (cont'd): Wholesale Banking
23 Divisional Performance (cont’d) Operating Environment • Wholesale Banking revenues increased 13% q-o-q and 4% Balance Sheet Trends Revenue Trends y-o-y AED Bn -3% AED Mn • Loans grew 2% from end 2016 due to growth in real Wholesale Banking +2% +13% estate, trade and FI sectors Emirates NBD Profil
Slide 24: Emirates NBD's core strategy building blocks
24 Emirates NBD’s core strategy is focused on the following building blocks Operating Environment Key Deliver an excellent customer Emirates NBD Profile Objective experience (with digital being the focus) Financial & Operating Performance Strategic Run an Drive Levers Drive core efficient geographic
Slide 25: Highlights of strategic achievements in 2016
25 Operating Environment Highlights of strategic achievements in 2016 2016 Strategic Priorities Key Achievements • Extend servicing of products through online, • Won Best Bank in the Middle East, Best Bank in the UAE and Best Digital 1 mobile, social channels Bank in the Middle East at the Euromoney
Slide 26: Strategic priorities for 2017
26 Operating Environment Strategic priorities for 2017 Pillars of our strategy Key focus areas 1 Deliver an excellent • Continue to deliver superior customer experience via investing into new digital channels, products, and capabilities customer experience (with digital being the • Reinforce ENBD’s
Slide 27: 2016 & 2017 Selected Awards
27 Operating Environment 2016 & 2017 Selected Awards Emirates NBD Profile ‘Smart Financial Services ‘Best equity house in the ‘Best Retail Bank in UAE’ and ‘Top banking brand in the ‘Auto Loan Product of the Excellence Award’ Middle East’ UAE’ Year in Asia Pacific’ Financial & Operating Performance
Slide 28: Large Deals Concluded in Q1 2017 (1/2)
28 Operating Environment Large Deals Concluded in Q1 2017 (1/2) T.C. ZIRAAT BANKASI .A.S. AKBANK T.A.S. Damac Ezdan Holding Warba Bank USD 278,000,000 AND EUR USD 404,500,000 AND EUR USD 125 million USD 500 million USD 250 million 706,500,000 738,270,000 Emirates NBD Profile DUAL CURRENCY TERM DUAL
Slide 29: Large Deals Concluded in Q1 2017 (2/2)
29 Operating Environment Large Deals Concluded in Q1 2017 (2/2) Al Baraka Bank Investment Corporation of Africa Finance Corporation Adani Ports PT. Pan Brothers TBK Dubai USD 200 million USD 150 million USD 500 million USD 1000 million USD 200 million Emirates NBD Profile Joint Solicitation Agent So
Slide 30: Investor Relations
Investor Relations PO Box 777 Emirates NBD Head Office, 4th Floor Dubai, UAE Tel: +971 4 201 2606 Email: |IR@emiratesnbd.com (4 Emirates NBD