Malayan Banking Bhd. · MYX:MAYBANK

Malayan Banking Bhd — 9M FY2020 Earnings Presentation

49 slides from Malayan Banking Bhd's earnings presentation, Nov 27, 2020

  1. Slide 1: Investor Presentation: Financial Results 3Q and 9M FY2020

    Investor Presentation Financial Results Third Quarter and Nine Months FY2020 ended 30 September 2020 27 November 2020 www.maybank.com 0

  2. Slide 2: Table of Contents

    Table of Contents Executive Summary 2 3Q & 9M FY2020 Financial Performance 6 Prospects & Outlook 19 Appendix: 1. Financial Performance 22 2. Community Financial Services 33 3. Global Banking 36 4. Maybank Singapore 39 5. Maybank Indonesia 42 6. Other Segments 45 1

  3. Slide 3: Maybank Group 3Q & 9M FY2020 Overview

    Maybank Group 3Q & 9M FY2020 Overview 3Q FY2020 vs 2Q FY2020 Performance 9M FY2020 YoY Performance Income up 7.6%: Income up 1.1%:  As NIM rebounds 9 bps QoQ on lagged re-pricing of  On higher realised securities disposal gains under deposit cost following earlier rate cuts and absence of investme

  4. Slide 4: Continued Commitment in Supporting Customers Through the COVID-19 Pandemic

    Continued Commitment in Supporting Customers Through the COVID-19 Pandemic Maybank Group’s Loans Under Repayment Assistance, Relief or R&R Programmes for Three Home Markets Malaysia as at as at Continued Repayment Assistance by Maybank, post moratorium % of Outstanding Loan Balance^ • ~89% of retail

  5. Slide 5: Digital Platforms Continue to Boost Consumer Spend and Support SMEs

    Digital Platforms Continue to Boost Consumer Spend and Support SMEs Sama-Sama Lokal RSME Loan STP • Sama-Sama Lokal selected as part • Application to Approval within 10 minutes of PENJANA – Maybank is the only • Available 24/7 on Maybank2u & Maybank2uBiz bank selected for this initiative. • Disburse

  6. Slide 6: Table of Contents

    Table of Contents Executive Summary 2 3Q & 9M FY2020 Financial Performance 6 Prospects & Outlook 19 Appendix: 1. Financial Performance 22 2. Community Financial Services 33 3. Global Banking 36 4. Maybank Singapore 39 5. Maybank Indonesia 42 6. Other Segments 45 5

  7. Slide 7: P&L Summary: 9M FY2020

    P&L Summary: 9M FY2020 Strong net fee based income and reduction in overhead expenses resulted in PPOP growth of 4.6% YoY More 9M 9M 3Q 2Q 3Q details RM million YoY QoQ YoY on FY2020 FY2019 FY2020 FY2020 FY2019 s.24 Net fund based income * 12,313.0 12,995.9 (5.3)% 4,128.3 3,840.3 7.5% 4,522.2 (8.7)%

  8. Slide 8: Net Fund Based Income: 9M FY2020 YoY Trends (1/2)

    Net Fund Based Income: 9M FY2020 YoY Trends (1/2) CASA growth momentum continues across the Group, while loans growth in Malaysia supported by franchise strength Group Malaysia Singapore Indonesia Gross Loans (YoY) Community Financial Services Global Banking  (0.6)%  +5.2%  (7.8)%  (15.8)% 324.2

  9. Slide 9: Net Fund Based Income: 9M FY2020 (2/2)

    Net Fund Based Income: 9M FY2020 (2/2) NIM compression of 19 bps for YTD 9M FY2020 with net mod loss impact, while QoQ NIM rebounded by 9 bps Net Interest Margin (%) QoQ Trend 2.32 2.29 2.23 5 Year Trend 2.05 1.96 3Q '19 4Q '19 1Q '20 2Q '20 3Q '20 2.36 Rate cuts in 9M’2020:  125bps OPR cut 2.33 

  10. Slide 10: Net Fee Based Income: 9M FY2020 (YoY)

    Net Fee Based Income: 9M FY2020 (YoY) Growth driven by realised securities disposal gains and MTM derivatives revaluation gains 9M 9M RM million YoY FY2019 FY2020 Commission, service charges and fees 2,460 2,285  (7.2)% Investment & trading income 1,478 1,959  32.5% Unrealised gain/ (losses) on fi

  11. Slide 11: Net Fee Based Income: 3Q FY2020 (QoQ)

    Net Fee Based Income: 3Q FY2020 (QoQ) QoQ improvement seen in core fees and investment disposal gains 3Q 2Q 3Q RM million QoQ YoY FY2020 FY2020 FY2019 Commission, service charges and fees 771 693  11.2% 882  (12.5)% Investment & trading income 711 479  48.3% 834  (14.7)% Unrealised gain/ (losses

  12. Slide 12: Overheads: 9M FY2020 (YoY)

    Overheads: 9M FY2020 (YoY) Continued cost containment efforts yield CIR of 45.3% and positive JAWs of 3.9% for 9M FY2020 9M 9M 3Q 2Q 3Q RM million YoY QoQ YoY FY2020 FY2019 FY2020 FY2020 FY2019 Personnel Costs 4,952.5 5,023.6 (1.4)% 1,581.5 1,644.0 (3.8)% 1,680.0 (5.9)% Establishment Costs 1,399.0 1

  13. Slide 13: Asset Quality (1/2)

    Asset Quality (1/2) Provisioning increased on top-ups for existing impaired accounts and additional overlays from 1H’20 Allowances for losses on loans 106.8% 9M FY2020 ECL includes: 99.2% 90.8% 89.5% • ~RM580 million additional 89.1% Loan loss coverage provisioning on MEV incl. Regulatory adjustment

  14. Slide 14: Asset Quality (2/2)

    Asset Quality (2/2) GIL for Group and by Home Markets trending down on slower formation of newly impaired loans and write-offs Group Gross Impaired Loans (GIL) Ratio Composition GIL Ratio Components Sep 2020 Jun 2020 Mar 2020 Dec 2019 Sep 2019 Non Performing Loans (NPL) 1.93% 2.03% 2.20% 2.20% 2.12%

  15. Slide 15: Asset Quality by Line of Business in Home Markets

    Asset Quality by Line of Business in Home Markets Consumer lines records QoQ improvement across the markets, with slight uptick seen in some business lines Consumer Mortgage Auto Finance Credit Cards MBI GIL normalised to 3.12% 3.11% include IFRS 9 impact 7.98% 7.16% 5.39% 2.38% 4.70% 1.71% 1.77% 1.

  16. Slide 16: Exposure to Oil & Gas and Real Estate Sectors: September 2020

    Exposure to Oil & Gas and Real Estate Sectors: 30 September 2020 Reduction in O&G exposure size Group Exposure to Direct & Indirect Oil & Gas Borrowers Real Estate Exposure to Non-Retail Malaysian Borrowers Maybank Group Malaysia Singapore Indonesia Others 2.57% 1.71% 0.62% 0.07% 0.17% High Rise Not

  17. Slide 17: Strong Liquidity & Capital Positions: September 2020

    Strong Liquidity & Capital Positions: 30 September 2020 Strong LCR of 146.6%, while Group CET1 capital ratio at 15.28% (assuming 85% reinvestment rate) After proposed dividend, Liquidity Risk Indicators Before proposed dividend assuming 85% reinvestment rate 19.39% 18.95% 18.89% LDR LTF LTFE LCR Gro

  18. Slide 18: Dividend: 9M FY2020

    Dividend: 9M FY2020 Single-tier interim dividend of 13.5 sen per share, fully electable under the Dividend Reinvestment Plan Dividend (sen), Payout Ratio (%) and Cash Component (%) 79.9% 87.8% Dividend 76.5% 74.9% 74.7% 71.9% 78.5% 76.3% 78.1% 78.5% 77.3% Payout Ratio 30.7% 53% 100% 27% 13% 11% 12%

  19. Slide 19: Table of Contents

    Table of Contents Executive Summary 2 3Q & 9M FY2020 Financial Performance 6 Prospects & Outlook 19 Appendix: 1. Financial Performance 22 2. Community Financial Services 33 3. Global Banking 36 4. Maybank Singapore 39 5. Maybank Indonesia 42 6. Other Segments 45 18

  20. Slide 20: Maybank Performance Outlook

    Maybank Performance Outlook Group guidance for remainder of FY2020 • NIM compression guidance of 20 bps for FY2020, incorporating 2Q net mod loss impact and on assumption of no further rate cuts across home markets. • To maintain good quality deposits in local currencies, with strong CASA growth in

  21. Slide 21: Market Outlook

    Market Outlook 2020 industry outlook for our home markets Key Indicators Outlook • The economy is expected to shrink, reflecting the • GDP: -5.4% (2020F) vs 4.3% (2019) impact of the COVID-19 pandemic, domestic • System loan: 2.5% (2020F) vs 3.9% (2019) Movement Control Order (MCO) and drop in crude

  22. Slide 22: Table of Contents

    Table of Contents Executive Summary 2 3Q & 9M FY2020 Financial Performance 6 Prospects & Outlook 19 Appendix: 1. Financial Performance 22 2. Community Financial Services 33 3. Global Banking 36 4. Maybank Singapore 39 5. Maybank Indonesia 42 6. Other Segments 45 21

  23. Slide 23: International & Malaysia Portfolio Mix 9M FY2020

    International & Malaysia Portfolio Mix 9M FY2020 Net Operating Income Profit Before Tax Gross Loans* 9M FY2020 (Jan 20 – Sep 20) Overseas: 6.5% Overseas: 4.2% Overseas: 7.9% 8.3% 34.4% 11.2% 13.3% 0.8% 37.4% 6.0% RM18.45 RM6.66 RM521.8 16.7% billion 23.5% billion billion 65.6% 62.6% 86.7% Malaysia S

  24. Slide 24: Segmental Performance of Businesses: 9M FY2020 (1/2)

    Segmental Performance of Businesses: 9M FY2020 (1/2) Net Operating Income 9M FY2019  +1.1% Group Global Banking  +6.7% 9M FY2020 9M FY2019: 7,284 9M FY2020: 7,775 18,248 18,451  (5.8)%  +5.0%  +26.6%  (34.7)%  (2.4)% 10,187 9,594 RM million 6,339 6,659 814 1,031 1,361 1,328 130 85 Total Group

  25. Slide 25: Segmental Performance of Businesses: 9M FY2020 (2/2)

    Segmental Performance of Businesses: 9M FY2020 (2/2) Net Fund Based Income 9M FY2019  (5.3)% Group Global Banking  +1.0% 9M FY2020 9M FY2019: 4,173 9M FY2020: 4,216 12,996 12,313  (4.2)%  +1.8%  (9.7)%  (82.8)%  (2.1)% 7,701 7,379 RM million 3,964 4,035 962 942 198 179 11 2 Total Group Commun

  26. Slide 26: Unaudited Income Statement for Insurance and Takaful Business

    Unaudited Income Statement for Insurance and Takaful Business 9M 9M 3Q 2Q 3Q RM million YoY QoQ YoY FY2020 FY2019 FY2020 FY2020 FY2019 Net interest income 942.1 961.8 (2.0)% 310.7 315.9 (1.6)% 327.4 (5.1)% Net earned premiums 6,676.1 4,999.5 33.5% 2,990.3 1,740.9 71.8% 1,749.1 71.0% Other operating

  27. Slide 27: Group Gross Loans Growth: September 2020

    Group Gross Loans Growth: 30 September 2020 % of 30 Sep 30 Jun 31 Mar 31 Dec YTD 30 Sep QoQ YoY Portfolio 2020 2020 2020 2019 Ann. 2019 Group Gross Loans 521.8 520.2  0.3% 518.4 523.5  (0.4)% 525.0  (0.6)% Malaysia (RM billion) 62% 324.2 316.1  2.5% 314.3 314.1  4.3% 308.0  5.2% Community Fina

  28. Slide 28: Malaysia Loans Growth: September 2020

    Malaysia Loans Growth: 30 September 2020 % of 30 Sep 30 Jun 31 Mar 31 Dec YTD 30 Sep RM billion QoQ YoY Portfolio 2020 2020 2020 2019 Ann. 2019 Community Financial Services (reported) 75% 243.2 234.6  3.7% 231.7 231.3  6.8% 226.1  7.5% Community Financial Services (rebased)¹ 75% 243.2 234.6  3.7

  29. Slide 29: Group Deposits Growth: September 2020

    Group Deposits Growth: 30 September 2020 % of 30 Sep 30 Jun 31 Mar 31 Dec YTD 30 Sep QoQ YoY Portfolio 2020 2020 2020 2019 Ann. 2019 Group Gross Deposits 593.2 573.3  3.5% 543.8 565.3  6.6% 566.2  4.8% Malaysia (RM billion) 62% 367.8 355.4  3.5% 336.7 351.5  6.2% 356.1  3.3% Savings Deposits 1

  30. Slide 30: LDR and CASA Ratio

    LDR and CASA Ratio Group LDR CASA CASA (without IA) Malaysia 92.5% 95.2% 93.9% 92.4% 90.6% 90.0% 89.4% 88.7% 87.8% 87.1% 38.4% 40.2% 42.1% 34.6% 35.5% 44.3% 47.1% 43.6% 39.1% 37.5% 38.7% 37.3% 35.1% 32.5% 33.2% 39.7% 42.3% 38.2% 34.0% 34.9% Sep 19 Dec 19 Mar 20 Jun 20 Sep 20 Sep 19 Dec 19 Mar 20 Jun

  31. Slide 31: RWA Optimisation and Funding Management

    RWA Optimisation and Funding Management Group Gross Loans & Group RWA Funding Breakdown Borrowings and Capital Instruments Operational RWA Market RWA by Currency Credit RWA Gross Loans 525.0 523.5 521.8 384.5 380.4 384.6 FI Deposits, 4% Equity, 11% JPY, HKD, IDR, 6% 42.7 42.9 43.4 10% 9% SGD, 4% CNH

  32. Slide 32: Key Operating Ratios

    Key Operating Ratios 9M 9M 3Q 2Q 3Q % YoY QoQ YoY FY2020 FY2019 FY2020 FY2020 FY2019 Return on Equity 8.2 10.1 (1.9)% 9.7 4.7 5.0% 10.5 (0.8)% Net Interest Margin 2.08 2.27 (19) bps 2.05 1.96 9 bps 2.32 (27) bps Fee to Income Ratio 33.3 28.8 4.5% 32.1 32.0 0.1% 30.4 1.7% Loans-to-Deposit Ratio 1 87.

  33. Slide 33: Table of Contents

    Table of Contents Executive Summary 2 3Q & 9M FY2020 Financial Performance 6 Prospects & Outlook 19 Appendix: 1. Financial Performance 22 2. Community Financial Services 33 3. Global Banking 36 4. Maybank Singapore 39 5. Maybank Indonesia 42 6. Other Segments 45 32

  34. Slide 34: Community Financial Services: Overview of Market Share for Malaysia

    Community Financial Services: Overview of Market Share for Malaysia Market share Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Loans Total consumer (Household) 17.6% 17.7% 17.8% 17.9% 18.1% Auto (Hire Purchase + Block Discounting + Floor Stocking) 29.3% 29.6% 29.7% 30.3% 30.4% Total mortgage * 13.7% 14.0% 14.2

  35. Slide 35: Community Financial Services: Overview of Malaysia Portfolio

    Community Financial Services: Overview of Malaysia Portfolio Total CFS loans on an upward trend of 7.5% YoY and 6.8% Total CFS deposits increased by 9.8% YoY driven by CASA YTD Ann. growth of 23.6%  +9.8% YoY  +7.5% YoY  +6.8% YTD Ann.  +10.0% YTD Ann. 231.3 243.2 226.1 200.0 204.3 219.6 43.2 44

  36. Slide 36: Table of Contents

    Table of Contents Executive Summary 2 3Q & 9M FY2020 Financial Performance 6 Prospects & Outlook 19 Appendix: 1. Financial Performance 22 2. Community Financial Services 33 3. Global Banking 36 4. Maybank Singapore 39 5. Maybank Indonesia 42 6. Other Segments 45 35

  37. Slide 37: Global Banking: 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 1.1% Group Securities Portfolio¹ grew 5.8% YoY YoY to RM80.8 billion RM billion  +5.8% YoY 49.3 Term Loan 46.7  +9.4%YoY 214.1 204.1 45.1 202.4 7.3 192.8 189.5

  38. Slide 38: Global Banking: Overview of Group Investment Banking Portfolio

    Global Banking: Overview of Group Investment Banking Portfolio 9M FY2020 Total Income Breakdown by Country 9M FY2020 Fee-based Income for Malaysia Other Fee Arranger's HongKong Others Income Fees 3% 4% 13% 20% Advisory Fee 2% Thailand 12% Agency/Guarantee Underwriting & Fees Placements Fees Philippi

  39. Slide 39: Table of Contents

    Table of Contents Executive Summary 2 3Q & 9M FY2020 Financial Performance 6 Prospects & Outlook 19 Appendix: 1. Financial Performance 22 2. Community Financial Services 33 3. Global Banking 36 4. Maybank Singapore 39 5. Maybank Indonesia 42 6. Other Segments 45 38

  40. Slide 40: Maybank Singapore: P&L Summary

    Maybank Singapore: P&L Summary SGD million 9M FY2020 9M FY2019 YoY 3Q FY2020 2Q FY2020 QoQ Net fund based income 429.63 576.88 (25.5)% 116.40 142.84 (18.5)% Net fee based income 290.31 280.54 3.5% 100.38 85.48 17.4% Net income 719.94 857.42 (16.0)% 216.78 228.32 (5.1)% Overhead expenses (348.25) (35

  41. Slide 41: Maybank Singapore: Overview of Loans and Deposits Portfolio

    Maybank Singapore: Overview of Loans and Deposits Portfolio Diversified Loan Portfolio Consumer deposits on par with business deposits % of 30 Sep 31 Dec YTD 30 Sep  +10.2% YoY SGD Billion YoY Portfolio 2020 2019 Ann. 2019 47.6 48.3 52.5 Consumer - Time Deposits CFS 57% 21.9 22.1 (1.4)% 22.7 (3.5%

  42. Slide 42: Table of Contents

    Table of Contents Executive Summary 2 3Q & 9M FY2020 Financial Performance 6 Prospects & Outlook 19 Appendix: 1. Financial Performance 22 2. Community Financial Services 33 3. Global Banking 36 4. Maybank Singapore 39 5. Maybank Indonesia 42 6. Other Segments 45 41

  43. Slide 43: Maybank Indonesia: P&L Summary

    Maybank Indonesia: P&L Summary 9M 9M 3Q 2Q IDR billion YoY QoQ FY2020 FY2019 FY2020 FY2020 Net Fund Based income 5,613 6,125 (8.4)% 1,677 1,912 (12.3)% Net Fee Based income 1,730 1,862 (7.1)% 546 586 (6.8)% Net income 7,343 7,988 (8.1)% 2,223 2,498 (11.0)% Overhead expenses (4,417) (4,856) (9.0)% (1

  44. Slide 44: Maybank Indonesia: Financial Ratios and Loans Portfolio Breakdown

    Maybank Indonesia: Financial Ratios and Loans Portfolio Breakdown Key Operating Ratios Loans Portfolio Breakdown % of 30 Sep 30 Jun 30 Sep Key Operating Ratio Sep-20 Dec-19 Sep-19 YoY IDR Trillion QoQ YoY Portfolio 2020 2020 2019 Profitability & Efficiency CFS 68% 73.9 79.9 (7.6)% 94.4 (21.8)% Retur

  45. Slide 45: Table of Contents

    Table of Contents Executive Summary 2 3Q & 9M FY2020 Financial Performance 6 Prospects & Outlook 19 Appendix: 1. Financial Performance 22 2. Community Financial Services 33 3. Global Banking 36 4. Maybank Singapore 39 5. Maybank Indonesia 42 6. Other Segments 45 44

  46. Slide 46: Islamic Banking: Performance Overview

    Islamic Banking: Performance Overview Group Islamic Banking Financial Performance Maybank Islamic: Total Gross Financing grew to RM203.6 billion RM million 9M FY2020 9M FY2019 YoY Sep-19 15% 59.7 Sep-20 Total Income 3,652.7 3,694.2 (1.1%) 51.9 7% 14% Profit Before Tax 1,690.5 2,473.8 (31.7%) 41.8

  47. Slide 47: Islamic Banking: Market Share

    Islamic Banking: Market Share Maybank Islamic Market Share Market Share by Product (Malaysia) 31.2% 31.1% 30.9% 30.7% 30.8% Key Products Sep 20 Sep 19 Automobile Financing 48.6% 47.1% 28.7% 28.9% 27.8% 27.6% 27.9% Home 26.9% 26.3% Term financing 28.0% 28.4% Sep 19 Dec 19 Mar 20 Jun 20 Sep 20 Financi

  48. Slide 48: Insurance and Takaful: Performance Overview

    Insurance and Takaful: Performance Overview Net Adjusted Premium/Contribution Life & Family (New Business) Market Share (Malaysia) Single Premium  311.1% 21.8% 21.4% 19.3% 19.1% Regular Premium  9.9% No. 4 in 14.2% 13.1% 16.7% 17.9% Life/Family Credit Premium  (29.6)% 9M FY20 (New Business) 14.5%

  49. Slide 49: Humanising Financial Services

    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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