Security Bank Corp. (philippines) · PSE:SECB
Security Bank Corp. (philippines) — Security Bank — H1 2014 Earnings Presentation
25 slides from Security Bank Corp. (philippines)'s earnings presentation, August 2014
Slide 1: Investor Presentation H1 2014 Results
Investor Presentation H1 2014 Results
Slide 2: Table of Contents
Table of Contents Our Company 3 Market Data 4 Banking Industry 5 Profitability 6 Cost Efficiency 8 Net Interest Margin 9 Fee-Based Income 10 Balance Sheet 11 Loan Portfolio 12 Deposit Portfolio 13 Asset Quality 14 Capital Strength 15 Dividends 16 Medium-Term Focus 17 Annex History 19 Key Financials
Slide 3: Our Company
Our Company Corporate Banking Total SECB SBS Corporate & Investment Investment Banking Branches* 253 214 39 Banking Equities Brokerage ATMs* 444 393 51 Transaction Banking Commercial Middle Commercial Financing LUZON Market Banking Small Business Lending 48 Branches | 23% 10 Branches | 2
Slide 4: Market Data
Market Data Shareholders(2) Security Bank Corporation Dy Group Company Identifiers 42% Bloomberg SECB.PM Reuters SECB PS Others 51.6% Stock Price as of Aug 04, 2014 128.50 52 week range (L-H) 105.10-144.30 Social Security Market Cap (PhP mm) 77,464 System 6.4% Market Cap (US$ mm) 1,773 PhP114 M / US
Slide 5: Banking Industry
SECB has roughly 4% market share in total assets, loans & deposits in 36-bank universal/commercial bank industry in the Banking Industry Philippines. SECB is driven by profitability first and foremost & will pursue aggressive build-up in market share if it improves profitability & shareholder value.
Slide 6: Profitability
Profitability Revenues (PhP Bn) Return on Equity (%) 15 14.0 40 12.9 1.8 13% 12.3 34.6 1.1 9% 11.7 1.7 14% 2.4 [H1‘-13: 5.3, 30 10 20% 4.1 29% +59%] 2.2 18% 24.6 5.6 43% 8.4 22.0 7.9 1.7 20.9 15% 0.9 11% 19.2 [H1‘-13: 8.9] 6.6 1.2 16% 20 17.2 22% 0.7 9% 1.7 20% 1.5 12.9 5 0.2 3% 7.5 8.1 58% 8.4 68%
Slide 7: Profitability
Profitability Return on Assets (%) Assets-to-Equity 6 12 10.2 Peer 5 4.9 10 Average(1): 9.2 8.6 8.2 8.5 4 8 3.5 7.2 7.0 3.3 6.8 3 6 Peer Average(1): 1.2 2.2 2 1.9 1.8 4 1.75 1 2 0 0 '08 '09 '10 '11 '12 '13 H1-'14 '08 '09 '10 '11 '12 '13 H1-'14 [H1-’13: 1.3] [H1-’13: 7.6] Note: (1) Source: 17-Q discl
Slide 8: Cost Efficiency
Cost Efficiency (1) Cost-to-Income Ratio (%) Operating Expense (PhP Mn) 60 7,000 6,752 54.8 50.9 5,972 50 49.5 [H1‘-13: 6,000 63.2] 36% 44.4 42.6 5,000 4,710 38% 40 37.0 36.9 4,346 [H1‘-13: 3,342; +12%] 4,000 3,911 7% 34% 3,735 30 3,364 32% 7% 9% 30% 36% 3,000 23% 6% 8% 7% 14% 7% 8% 20 8% 8% 14% 7%
Slide 9: Net Interest Margin
Net Interest Margin Asset Yields vs. Funding Cost (%) (1) (2) Net Interest Margin (%) (2) 10 5 4.5 4.4 4.0 3.9 4.1 4.1 8 3.9 7.1 4 7.0 3.6 3.5 3.5 3.5 3.5 3.5 3.4 6.0 5.9 6 6.6 6.4 3 5.1 5.7 4.4 5.4 4.2 5.1 4 3.4 4.4 2 3.0 4.2 2.3 2.1 3.0 1.8 1.6 2 2.5 1.2 1 2.1 2.0 1.8 1.3 1.0 0 0 '08 '09 '10 '11 '
Slide 10: Fee-Based Income
Fee-Based Income Diversified Fee Income (1) Service Charges, Fees and Commissions (PhP Mn) Miscellaneous, 1,561 1,600 6% Deposit, Asset 15% 92 Mgt./Trust, 1,440 12% 181 1,280 1,255 68 193 1,120 1,035 132 [H1-’13: 837; 964 39 +1%] 960 229 60 869 892 120 218 Advisory, 851 63 34 41 12% 104 36 800 63 79
Slide 11: Balance Sheet: Asset & Funding Structure
Balance Sheet: Asset & Funding Structure Total Assets (PhP Bn) Total Liabilities and Capital (PhP Bn) 400 385 400 385 348 348 350 350 97 25% 300 101 29% 300 259 259 218 57% 250 250 206 67% 215 115 30% 215 76 30% 200 82 24% 200 166 49 23% 166 142 55% 146 146 138 138 119 12 3% 150 63 24% 150 55% 56 33
Slide 12: Loan Portfolio
Loan Portfolio Total Loans (PhP Bn) By Industry(1) 180 173 165 6% (1) Manufacturing Others 5% 15% 23% 150 38% 40% Wholesale/ 120 119 Retail Trade 7% 21% 92 38% 90 2% 70 75 Financial 67 3% 4% 38% 5% Intermediation 60 29% 33% 38% 54% 13% 57% 57% 30 60% 66% 64% 58% Real Estate 0 10% Utilities '08 '09 '
Slide 13: Deposit Portfolio
Deposit Portfolio Total Deposits (PhP Bn) (1) By Segment (2) 218 Corporate 220 207 62% 200 Retail 180 38% 160 143 135 62% 140 134 65% 120 119 109 111 103 100 88 62% 80 69 58% 67 By Currency 60% 65 71 65% 63% 60 38% FCDU 40 83 73 35% 25% 50 42% 55 38% 20 38 37% 38 35% 44 40% 0 '08 '09 '10 '11 '12 '13
Slide 14: Asset Quality
Asset Quality NPL Ratio and NPL Cover (%) (1) NPA Ratio and NPA Cover (%) 10 188 194 200 10 319 315 350 179 179 296 297 285 155 155 300 8 8 256 259 141 150 250 6 6 200 100 150 4 4 3.10 2.30 100 2.00 50 2 1.50 1.30 2 1.30 1.25 0.92 0.98 1.08 0.94 50 0.70 0.52 0.57 0 0 0 0 ’08 '09 '10 '11 '12 '13 H1-'
Slide 15: Capital Strength
Capital Strength Total CAR (%) Major Philippine Banks’ Capitalization (%) (2) 25 48 25 Median Tier 1 CAR = 12.5% 44 21.8 Median Total CAR = 14.5% 20.3 41 20 18.5 18.4 20 37 36 19.0 18.2 16.3 15.5 16.1 16.2 31 15.4 15.4 15 14.0 15 14.0 14.5 13.8 15.4 15.1 14.8 13.0 14.7 14.5 25 24 11.7 13.2 13.2 13.1
Slide 16: Dividends
Dividends Dividend Per Share (PhP) (1) (3) Dividend Yield (%) (2) (3) 2.5 25% 9.0 8.0 20% 20% 8.0 2.0 20% 7.0 0.5 0.5 6.0 1.5 0.5 1.0 1.0 1.0 15% 5.0 4.0 1.0 10% 3.2 3.0 1.5 1.5 0.5 2.3 2.1 1.3 2.0 0.5 1.0 1.0 1.0 5% 1.5 1.6 1.3 0.5 1.0 0.0 0% 0.0 '08 '09 '10 '11 '12 '13 H1-'14 '08 '09 '10 '11 '12 '
Slide 17: Medium-Term Focus
Medium-Term Focus Sustain Leading Return on Shareholders’ Equity Grow the High-Margin Retail Banking Business Grow Our Core Strengths: Wholesale Banking and Financial Markets Expand Branch/Distribution Network: 260 branches in 2014 17
Slide 18: Annex
6 SECURITY BANK Annex
Slide 19: Security Bank
Security Bank Established on June 18, Granted a universal Corporation 1951 as Security Bank banking license by BSP in celebrated its and Trust Company April 1994, allowing it to 60th anniversary Re-branding & new corporate (SBTC). broaden the scope of its in June 2011. logo launched on Feb. 23, fina
Slide 20: Key Financials
Key Financials Net Income After Tax Total Resources 8,000 7,516 400 7,160 348 7,000 6,682 350 6,000 300 259 5,012 5,000 250 215 4,000 200 166 3,062 146 3,000 2,709 150 129 138 122 2,310 105 1,901 88 2,000 100 69 74 1,160 1,000 631 694 50 502 - - 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Slide 21: Business Proposition
Business Proposition 1 Core Franchise Strength 5 2 Strategy for Well Sustainable Capitalized, Stable Growth Liquidity 4 Proven & 3 Experienced Industry-Leading Management Asset Quality Team 21
Slide 22: 2012-2014 Initiatives
2012-2014 Initiatives › Acquisition closed – Feb. 1, 2012 Security Bank Savings › Balance sheet: assets - PhP 5bn; loans - PhP 3bn (Formerly Premiere Development Bank) › Purchase price - PhP 1.3bn, all cash; price-to-book – 1.7x › Branches: 38 all in Metro Manila & Luzon, 10 branches relocated to re
Slide 23: Foundation Building Initiatives 2013-2014
Foundation Building Initiatives 2013-2014 10 Service Quality 8 9 Cards Business Online Positioning Channels 5 Improved 6 7 TAT on SBC Rebranding Consumer Academy Loans 1 2 3 4 Sales Force Organization Branch SAs (Sales Associates) & Lean & Performance Expansion SPOCs (Single Point of Branch Contact)
Slide 24: Management Team
Management Team Alberto S. Villarosa President and Chief Executive Officer Over 30 years of experience and leadership in the industry, having worked for BPI, CityTrust and Citibank in key management positions. Rafael S. Algarra, Jr. Executive Vice President-Financial Markets Segment Executive Office
Slide 25: Track Record of Excellence
Track Record of Excellence 2014 2014 2014 2014 2013 Best Cash Management Solution (eSweep Card) - Among the Best Investor Best Investor Relations Philippines, Relations Companies - Company - Philippines, Excellence in Payment Best Managed Bank in the Best Service Provider / Philippines Best CEO (Inv