Malayan Banking Bhd. · MYX:MAYBANK

Malayan Banking Bhd — H1 2019 Earnings Presentation

47 slides from Malayan Banking Bhd's earnings presentation, Aug 29, 2019

  1. Slide 1: Investor Presentation: Financial Results 2Q FY2019 and 1H FY2019

    Humanising Financial Services Investor Presentation Financial Results 2Q FY2019 and 1H FY2019 ended 30 June 2019 29 Aug 2019 www.maybank.com 0

  2. Slide 2: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 4 Prospects & Outlook 16 Appendix: 1. Financial Performance 19 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 1 Financial Results: 2Q FY2019 and 1H FY2019 ended 30 Jun

  3. Slide 3: Maybank Group 1H FY2019 Overview

    Maybank Group 1H FY2019 Overview Improved net operating income of RM11.75 billion supported by loans growth and higher net fee based income 1 1H FY2019 • 1H FY2019 net operating income growth of 1.0% YoY mitigated by slightly higher Net Profit of overheads and net impairment losses, resulting in net

  4. Slide 4: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 4 Prospects & Outlook 16 Appendix: 1. Financial Performance 19 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 3 Financial Results: 2Q FY2019 and 1H FY2019 ended 30 Jun

  5. Slide 5: P&L Summary: 1H FY2019

    P&L Summary: 1H FY2019 Net operating income supported by YoY growth in net fund and net fee based income More 1H 1H 2Q 1Q 2Q details RM million YoY QoQ YoY on FY2019 FY2018 FY2019 FY2019 FY2018 s.21 Net fund based income * 8,473.7 8,393.1 1.0% 4,166.8 4,306.9 (3.3)% 4,155.2 0.3% s.7/ 8/21 Net fee ba

  6. Slide 6: Net Fund Based Income: 1H FY2019 (1/2)

    Net Fund Based Income: 1H FY2019 (1/2) Targeted balance sheet growth across home markets in line with Group’s risk posture Group Malaysia Singapore Indonesia Gross Loans (YoY) Community Financial Services Global Banking  +4.6%  +4.2%  +2.3%  +6.1% 302.9 SGD billion 139.2 IDR trillion 290.5 RM bi

  7. Slide 7: Net Fund Based Income: 1H FY2019 (2/2)

    Net Fund Based Income: 1H FY2019 (2/2) NIM compressed 9 bps YTD ann. on lower Malaysia loan yield from OPR cut and higher deposit cost in overseas markets Net Interest Margin (%) QoQ Trend 2.38 2.30 2.30 5 Year Trend 2.27 2.19 2Q '18 3Q '18 4Q '18 1Q '19 2Q '19 2.36 2.33 2.31 2.27 2.24 FY2015 FY2016

  8. Slide 8: Net Fee Based Income: 1H FY2019

    Net Fee Based Income: 1H FY2019 YoY growth driven by higher insurance net fee income but mitigated by unrealised losses on financial liabilities 1H 1H RM million YoY FY2018 FY2019 Commission, service charges and fees 1,693 1,579  (6.7)% Investment & trading income 85 645  >100% Unrealised gain/ (l

  9. Slide 9: Net Fee Based Income: 2Q FY2019

    Net Fee Based Income: 2Q FY2019 Stronger investment and trading income QoQ improved net fee based income 2Q 1Q 2Q RM million QoQ YoY FY2019 FY2019 FY2018 Commission, service charges and fees 805 773  4.2% 857  (6.0)% Investment & trading income 438 206  >100% (24)  (>100)% Unrealised gain/ (loss

  10. Slide 10: Overheads: 1H FY2019

    Overheads: 1H FY2019 Stable overheads trend QoQ; low growth YoY mainly led by personnel and marketing costs 1H 1H 2Q 1Q 2Q RM million YoY QoQ YoY FY2019 FY2018 FY2019 FY2019 FY2018 Personnel Costs 3,343.6 3,141.3 6.4% 1,656.6 1,686.9 (1.8)% 1,550.7 6.8% Establishment Costs 890.1 873.4 1.9% 448.7 441

  11. Slide 11: Asset Quality

    Asset Quality Annualised net credit charge off rate of 38 bps with Group GIL ratio of 2.62% Allowances for losses on loans Group Gross Impaired Loans (GIL) Ratio Composition Loan loss coverage incl. Regulatory Reserve Jun Mar Dec Sep Jun Loan loss coverage GIL Ratio Components 2019 2019 2018 2018 20

  12. Slide 12: Asset Quality by Line of Business

    Asset Quality by Line of Business Mostly stable AQ trends with some uptick in RSME and BB in Indonesia and CB in Malaysia Consumer Mortgage Auto Finance Credit Cards 2.63% 2.73% 2.88% 2.59% 2.61% 1.42% 1.36% 1.34% 1.97% 1.33% 1.27% 1.83% 1.84% 1.86% 1.66% 1.78% 1.53% 0.92% 0.93% 1.41% 1.30% 0.85% 0.

  13. Slide 13: Liquidity Management: June 2019

    Liquidity Management: 30 June 2019 Well-diversified funding sources with stable Group liquidity risk indicators Funding Breakdown Borrowings and Liquidity Risk Indicators Capital Instruments by Currency LDR LTF LTFE LCR 144.9% 130.5% 132.4% 134.2% 145.4% FI Deposits, 6% HKD, 9% Equity, 11% IDR, CNY,

  14. Slide 14: Strong Capital Position: June 2019

    Strong Capital Position: 30 June 2019 Total capital ratio of 17.98% and CET1 capital ratio of 14.23%, after proposed full cash interim dividend payout Before proposed After proposed dividend full cash dividend 19.02% 18.71% Jan 2019 17.98% Regulatory Requirements Group Onwards 15.98% 15.87% 15.14% M

  15. Slide 15: Dividend: 1H FY2019

    Dividend: 1H FY2019 Single-tier interim cash dividend of 25 sen per share Dividend (sen), Payout Ratio (%) and Cash Component (%) 79.9% 78.5% 78.1% 78.5% 77.3% Dividend 76.5% 74.9% 74.7% 76.3% 74.9% Payout Ratio 71.9% 100% 67% 53% Cash Component 27% 13% 11% 12% 20% 25% 19% 27% of Total Dividend 65.0

  16. Slide 16: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 4 Prospects & Outlook 16 Appendix: 1. Financial Performance 19 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 15Financial Results: 2Q FY2019 and 1H FY2019 ended 30 Jun

  17. Slide 17: Market Outlook

    Market Outlook FY2019 Industry outlook for our home markets Key Indicators Industry Outlook • Growth supported by recovery in the mining • GDP: 4.4% (2019F) vs 4.7% (2018) and agriculture sectors as well as stimulus to • System loan: 4.7% (2019F) vs 5.6% (2018) domestic demand from rate cut and the

  18. Slide 18: Maybank Performance Outlook

    Maybank Performance Outlook Group guidance for FY2019 1 Income Growth  Expand revenue streams through cross business collaborations  Measured balance sheet expansion in line with economic growth of home markets and Group’s conservative risk posture  Group ROE guidance of 10.0% to 10.5%, on slower

  19. Slide 19: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 4 Prospects & Outlook 16 Appendix: 1. Financial Performance 19 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 18Financial Results: 2Q FY2019 and 1H FY2019 ended 30 Jun

  20. Slide 20: International & Malaysia Portfolio Mix 1H FY2019

    International & Malaysia Portfolio Mix 1H FY2019 Net Operating Income Profit Before Tax Gross loans* 1H FY2019 (Jan 19 – Jun 19) Overseas: 7.0% Overseas: 4.6% Overseas: 8.5% 6.8% 37.7% 12.2% 14.4% 3.0% 41.9% 7.7% RM11.75 RM5.10 RM525.6 18.5% billion billion billion 25.7% 58.1% 62.3% 85.6% Malaysia S

  21. Slide 21: Segmental Performance of Businesses: 1H FY2019 (1/2)

    Segmental Performance of Businesses: 1H FY2019 (1/2) Net Operating Income 1H FY2018  +1.0% Group Global Banking  +0.4% 1H FY2019 1H FY2018: 4,588 1H FY2019: 4,608 11,635 11,750  (0.4)%  +3.4%  (26.0)%  +>100%  +48.1% 6,679 6,652 RM million 3,831 3,963 712 527 632 936 45 118 Total Group Commun

  22. Slide 22: Segmental Performance of Businesses: 1H FY2019 (2/2)

    Segmental Performance of Businesses: 1H FY2019 (2/2) Net Fund Based Income 1H FY2018  +1.0% Group Global Banking  (0.8)% 1H FY2019 1H FY2018: 2,716 1H FY2019: 2,695 8,393 8,474  (1.1)%  +0.8%  (25.8)%  +61.3%  +13.5% 5,098 5,043 RM million 2,540 2,559 171 8 559 635 127 5 Total Group Community

  23. Slide 23: Unaudited Income Statement for Insurance and Takaful Business

    Unaudited Income Statement for Insurance and Takaful Business 1H 1H 2Q 1Q 2Q RM million YoY QoQ YoY FY2019 FY2018 FY2019 FY2019 FY2018 Net interest income 634.3 559.0 13.5% 322.0 312.3 3.1% 280.8 14.7% Net earned premiums 3,250.4 3,001.4 8.3% 1,623.8 1,626.5 (0.2)% 1,490.0 9.0% Other operating incom

  24. Slide 24: Exposure to Oil & Gas and Real Estate Sectors: June 2019

    Exposure to Oil & Gas and Real Estate Sectors: 30 June 2019 Group Exposure to Direct & Indirect Oil & Gas Borrowers Real Estate Exposure to Non-Retail Malaysian Borrowers Maybank Group Malaysia Singapore Indonesia Others Others, 30.7% High Rise 3.08% 1.75% 0.99% 0.09% 0.25% Residential, 30.4% Note:

  25. Slide 25: Group Gross Loans Growth: June 2019

    Group Gross Loans Growth: 30 June 2019 % of 30 Jun 31 Mar 31 Dec YTD 30 Jun QoQ YoY Portfolio 2019 2019 2018 Ann. 2018 Group Gross Loans 525.6 516.9  1.7% 517.3  3.2% 502.4  4.6% Malaysia (RM billion) 58% 302.9 299.5  1.1% 299.2  2.4% 290.5  4.2% Community Financial Services (reported) 73% 222

  26. Slide 26: Malaysia Loans Growth: June 2019

    Malaysia Loans Growth: 30 June 2019 % of 30 Jun 31 Mar 31 Dec YTD 30 Jun RM billion QoQ YoY Portfolio 2019 2019 2018 Ann. 2018 Community Financial Services (reported) 73% 222.5 218.3  1.9% 216.0  6.1% 209.0  6.5% Community Financial Services (rebased)¹ 73% 222.5 218.3  1.9% 215.9  6.1% 209.0 

  27. Slide 27: Group Deposits Growth: June 2019

    Group Deposits Growth: 30 June 2019 % of 30 Jun 31 Mar 31 Dec YTD 30 Jun QoQ YoY Portfolio 2019 2019 2018 Ann. 2018 Group Gross Deposits 560.9 557.6  0.6% 556.3  1.7% 539.8  3.9% Malaysia (RM billion) 62% 351.2 343.9  2.1% 343.8  4.3% 335.8  4.6% Savings Deposits 13% 44.5 43.9  1.3% 42.8  7.

  28. Slide 28: Continued RWA Optimisation

    Continued RWA Optimisation Group Gross Loans Total Group RWA  +4.6% YoY  +1.6% YoY  +3.2% YTD Ann. 525.6  +8.0% YTD Ann. 517.3 502.4 383.3 389.5 374.6  +1.6% 42.1 41.3 41.8 20.4 21.2  +33.4% Operational RWA 17.5 RM billion RM billion  +7.4% Market RWA 320.9 327.0 315.3 Credit RWA Jun 18 Dec 1

  29. Slide 29: LDR and CASA Ratio

    LDR and CASA Ratio Group LDR CASA CASA (without IA) Malaysia 92.8% 94.4% 92.7% 92.4% 93.4% 87.8% 89.5% 87.9% 88.0% 87.2% 35.1% 35.1% 35.9% 34.9% 34.5% 37.3% 37.9% 38.7% 37.5% 37.5% 33.2% 33.2% 33.6% 32.4% 32.6% 34.3% 34.9% 34.9% 34.0% 33.8% Jun 18 Sep 18 Dec 18 Mar 19 Jun 19 Jun 18 Sep 18 Dec 18 Mar

  30. Slide 30: Key Operating Ratios

    Key Operating Ratios 1H 1H 2Q 1Q 2Q % YoY QoQ YoY FY2019 FY2018 FY2019 FY2019 FY2018 Return on Equity 9.8 10.8 (1.0)% 10.2 9.7 0.5% 11.1 (0.9)% Net Interest Margin 2.24 2.33 (9) bps 2.19 2.30 (11) bps 2.27 (8) bps Fee to Income Ratio 27.9 27.9 0.0% 29.3 26.5 2.8% 28.6 0.7% Loans-to-Deposit Ratio 1 9

  31. Slide 31: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 4 Prospects & Outlook 16 Appendix: 1. Financial Performance 19 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 30Financial Results: 2Q FY2019 and 1H FY2019 ended 30 Jun

  32. Slide 32: Community Financial Services: Overview of Market Share for Malaysia

    Community Financial Services: Overview of Market Share for Malaysia Jun-19 Market Market share Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 vs position Mar-19 Loans Total consumer (Household) 17.6% 17.7% 17.7% 17.8% 17.5% 2 Auto (Purchase of transport vehicles) 27.1% 27.3% 27.7% 28.0% 28.3% 2 Total mortgage *

  33. Slide 33: Community Financial Services: Overview of Malaysia Portfolio

    Community Financial Services: Overview of Malaysia Portfolio Total CFS loans on an upward trend of 6.5% YoY and 6.1% Total CFS deposits decreased by 3.3% YoY, due to reduction YTD annualised. in high cost deposits, mitigated by CASA growth of 2.7%  (3.3)% YoY  +6.5% YoY  (1.5)% YTD Ann.  +6.1% Y

  34. Slide 34: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 4 Prospects & Outlook 16 Appendix: 1. Financial Performance 19 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 33Financial Results: 2Q FY2019 and 1H FY2019 ended 30 Jun

  35. Slide 35: Global Banking: Overview of Malaysia Corporate Banking and Group Securities Portfolio

    Global Banking: Overview of Malaysia Corporate Banking and Group Securities Portfolio Total Corporate Banking loans in Malaysia decreased 1.3% Group Securities Portfolio¹ grew 13.1% YoY YoY to RM80.5 billion RM billion  +13.1% YoY 45.7 Term Loan 45.1  +6.0% YoY 43.2 194.9 186.5 179.0 178.0 8.4 172

  36. Slide 36: Global Banking: Overview of Group Investment Banking Portfolio

    Global Banking: Overview of Group Investment Banking Portfolio 1H FY2019 Total Income Breakdown by Country 1H FY2019 Fee-based Income for Malaysia Hong Kong Others Arranger Fees 5% 5% 27% Underwriting & Philippines Placement Fees 2% 11% Indonesia 5% Malaysia Advisory Fees Thailand 45% RM526.6 10% 14

  37. Slide 37: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 4 Prospects & Outlook 16 Appendix: 1. Financial Performance 19 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 36Financial Results: 2Q FY2019 and 1H FY2019 ended 30 Jun

  38. Slide 38: Maybank Singapore: P&L Summary

    Maybank Singapore: P&L Summary SGD million 1H FY2019 1H FY2018 YoY Net fund based income 383.01 371.08 3.2% Net fee based income 161.76 201.39 (19.7%) Net income 544.76 572.47 (4.8%) Overhead expenses (233.99) (211.48) 10.6% Operating profit 310.77 360.99 (13.9%) Profit before taxation 17.15 176.63

  39. Slide 39: Maybank Singapore: Overview of Loans and Deposits Portfolio

    Maybank Singapore: Overview of Loans and Deposits Portfolio Diversified Loan Portfolio Consumer deposits’ composition rose to 53% of total deposits % of 30 Jun 31 Dec YTD 30 Jun SGD Billion YoY  (3.0)% YoY Portfolio 2019 2018 Ann. 2018 CFS 54% 22.9 22.6 2.7% 22.5 1.6% 47.0 46.2 45.6 Consumer - Cons

  40. Slide 40: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 4 Prospects & Outlook 16 Appendix: 1. Financial Performance 19 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 39Financial Results: 2Q FY2019 and 1H FY2019 ended 30 Jun

  41. Slide 41: Maybank Indonesia: P&L Summary

    Maybank Indonesia: P&L Summary 1H 1H 2Q 1Q IDR billion YoY QoQ FY2019 FY2018 FY2019 FY2019 Net Fund Based income 4,024 3,932 2.4% 1,987 2,037 (2.4)% Net Fee Based income 1,167 1,022 14.1% 652 515 26.6% Net income 5,191 4,954 4.8% 2,639 2,552 3.4% Overhead expenses (3,183) (2,988) 6.5% (1,598) (1,585

  42. Slide 42: Maybank Indonesia: Financial Ratios and Loans Portfolio Breakdown

    Maybank Indonesia: Financial Ratios and Loans Portfolio Breakdown Key Operating Ratios Loans Portfolio Breakdown Key Operating Ratio Jun-19 Dec-18 Jun-18 YoY % of 30 Jun 31 Mar 30 Jun IDR Trillion QoQ YoY Portfolio 2019 2019 2018 Profitability & Efficiency CFS 72% 97.6 100.0 (2.3)% 97.0 0.7% Return

  43. Slide 43: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 4 Prospects & Outlook 16 Appendix: 1. Financial Performance 19 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 42Financial Results: 2Q FY2019 and 1H FY2019 ended 30 Jun

  44. Slide 44: Islamic Banking: Performance Overview

    Islamic Banking: Performance Overview Group Islamic Banking Financial Performance Maybank Islamic: Total Gross Financing grew to RM183.7 billion RM million 1H FY2019 1H FY2018 YoY Jun-18 Jun-19 Total Income 2,521.0 2,797.6 (9.9)% 12% 50.3 10% Profit Before Tax 1,671.8 1,184.5 41.1% 7% 45.0 40.9 

  45. Slide 45: Islamic Banking: Market Share

    Islamic Banking: Market Share Maybank Islamic Market Share Market Share by Product (Malaysia) 31.1% 30.9% 31.0% 31.0% 30.7% Key Products Jun 19 Jun 18 Automobile Financing 46.5% 44.1% 28.8% 28.8% 28.4% 28.3% Home 26.3% 26.1% 27.8% Term financing 28.3% 28.0% Jun 18 Sep 18 Dec 18 Mar 19 Jun 19 Financi

  46. Slide 46: Insurance and Takaful: Performance Overview

    Insurance and Takaful: Performance Overview Net Adjusted Premium/ Contribution Life / Family (New Business) Market Share (Malaysia) Single Premium  (6.3)% 20.1% 22.1% 21.9% 18.6% Regular Premium  8.5% No. 4 in Credit Premium  (3.0)% 1H FY2019 14.9% 14.8% 13.9% 16.5% Life/Family (New Business) Gro

  47. Slide 47: Malayan Banking Berhad contact details and disclaimer

    Humanising Financial Services MALAYAN BANKING BERHAD 14th Floor, Menara Maybank 100, Jalan Tun Perak 50050 Kuala Lumpur, Malaysia Tel : (6)03-2070 8833 www.maybank.com Disclaimer. This presentation has been prepared by Malayan Banking Berhad (the “Company”) for information purposes only and does not

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