Ammb Holdings Bhd. · MYX:AMBANK

Ammb Holdings Bhd — H1 2021 Earnings Presentation

48 slides from Ammb Holdings Bhd's earnings presentation, Nov 30, 2020

  1. Slide 1: H1FY2021 Results Investor Presentation

    H1FY2021 RESULTS INVESTOR PRESENTATION 30 NOVEMBER 2020

  2. Slide 2: GCEO Presentation

    GCEO PRESENTATION Dato’ Sulaiman Mohd Tahir 3 H1FY21 Financial Snapshot 4 Outlook for 2020 5 Repayment Assistance 8 Loans by Stages 9 Capital Position 10 FY21 Agenda

  3. Slide 3: H1FY21 Financial snapshot

    Financial Snapshot H1FY21 Financial snapshot H1FY21 Financials Sustained revenue and PBP growth Top up RM205m macro provisions in Q2FY21 2,247 • Underlying income up 7% YoY, excluding net modification loss of Income  5% H1FY20: 2,133 RM35m 1,062 Expenses  1% • Cost well-contained H1FY20: 1,055 1,1

  4. Slide 4: Outlook for 2020

    Market Outlook Outlook for 2020 Malaysia GDP Growth Inflation Export growth USD/MYR outlook -5.3% to -5.7% -0.9% to -1.1% -3.5% 4.10 to 4.12 Banking sector Liquidity & Loans growth Asset Quality OPR capital positions 4.0% to 5.0% Weaker 1.75% Resilient 4 H1FY2021 Results – Investor Presentation

  5. Slide 5: Repayment assistance – Overview and Retail portfolio

    Repayment Assistance Repayment assistance – Overview and Retail portfolio Overview Repayment assistance by type of borrowers BNM’s Loan Moratorium Repayment assistance Repayment assistance Corporates (ended on 30 Sep 2020) (To-date @ 13 Nov 2020) 3.6 bil 31% Retail 4.9 bil Total assistance: 42% ~RM6

  6. Slide 6: Repayment assistance – SME

    Repayment Assistance Repayment assistance – SME1 Repayment assistance by internal risk grade Repayment assistance Repayment assistance Impaired 1% RM3.2bil loans outstanding (14% of RM22.5bil of total SME1 loans) Very Marginal ~ Strong ~ Substandard Strong 26% 26% Risk Grades Moderate ~ Satisfactory

  7. Slide 7: Repayment assistance – Corporates portfolios

    Repayment Assistance Repayment assistance – Corporates portfolios Repayment assistance by internal risk grade Repayment assistance Repayment assistance Impaired 2% 161 customers Marginal ~ RM3.6bil loans outstanding Substandard (13% of RM28.5bil of total Corporate loans) 12% Satisfactory ~ Moderate

  8. Slide 8: Loans by stages

    Loans Loans by stages Loans by ECL Stages (RM’ bil) Breakdown by Business Segments (%) BNM 6-month loan moratorium Stage 1 Stage 2 Stage 3 Stage 1 WB 100.8 102.0 104.5 107.2 107.4 110.6 BB 88% 2% 2% 2% 2% 2% 2% 11% 11% 11% 11% 12% 12% 86% RB 85% Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 Q2FY21 Stage 2 87%

  9. Slide 9: Capital position

    Capital Capital position • FHC CET1 of 13.5% • Regulatory reserve released • Loss absorption capacity of RM7.0bil, stress test performed • Deferred interim dividends as additional prudence Loss Absorption Capacity (LAC) Pillar 1 Capital Conservation Buffer CET 1 13.5% 6.5% Cumulative LAC of RM7.0bil

  10. Slide 10: FY21 Agenda

    FY21 Agenda FY21 Agenda • Economic uncertainties amid resurgence of COVID-19 H2FY21 OUTLOOK • Fixed income trading gain tapering off • Emergence of credit risk and debt rehabilitation support • Repayment assistance for targeted customers ENGAGE AND SUPPORT • COVID-19 related financing schemes • Staf

  11. Slide 11: GCFO Presentation

    GCFO PRESENTATION Jamie Ling 12 - 26 Financial Overview

  12. Slide 12: Q2FY21 Financial overview

    Financial Overview Q2FY21 Financial overview 1 Capital • Adequate loss absorption capacity • CET1 strengthened further to 13.5% (+105 bps YTD) • RM382mil of macro overlay provision • Fully released regulatory reserve of RM387.5mil, while maintaining LLC at ~100% 2 Liquidity & Funding • Highly liquid

  13. Slide 13: H1FY21 Performance summary – P&L

    Financial Overview H1FY21 Performance summary – P&L P&L Q2FY21 Q1FY21 QoQ Change H1FY21 H1FY20 YoY Change (RM’ mil) Total Income 1,155 1,092  6% 2,247 2,133  5% Expenses 524 539  3% 1,062 1,055  1% PBP 631 554  14% 1,185 1,079  10% Net Impairment 333 50  >100% 382 77  >100% PATMI 237 365  3

  14. Slide 14: H1FY21 Performance summary – balance sheet

    Financial Overview H1FY21 Performance summary – balance sheet Balance Sheet Q2FY21 Q1FY21 QoQ Change H1FY21 FY20 YTD Change (RM’ bil) Gross Loans 110.6 107.4  3% 110.6 107.2  3% GIL 1.57% 1.66%  9bps 1.57% 1.73%  16bps LLC 99.9% 97.0%1  290bps 99.9% 93.4%1  650bps Customer Deposits 114.8 114.3

  15. Slide 15: Unpacking the normalised items

    Underlying Unpacking the normalised items Normalised P&L (RM’ mil) H1FY21 H1FY20 YoY Change Q2FY21 Q1FY21 QoQ Change Income - Reported 2,247 2,133  5% 1,155 1,092  6% Net modification (loss)/ unwinding (35) - - 23 (58) Income - Underlying 2,282 2,133  7% 1,132 1,150  2% Expenses - Reported 1,062

  16. Slide 16: Resilient income growth

    Income Resilient income growth Business Segments Q2FY21 Q1FY21 QoQ Change H1FY21 H1FY20 YoY Change (RM’ mil) Wholesale Banking 398 407  2% 805 636  27% Investment Banking 91 75  22% 166 139  20% Retail Banking 401 342  17% 743 727  2% Business Banking 93 80  16% 173 177  2% Group Funding & O

  17. Slide 17: Maintained positive operating leverage

    PBP & PATMI Maintained positive operating leverage Business Segments Q2FY21 Q1FY21 QoQ Change H1FY21 H1FY20 YoY Change (RM’ mil) Wholesale Banking 329 342  4% 671 492  36% Investment Banking 46 32  44% 78 48  61% Retail Banking 185 130  42% 315 301  5% Business Banking 58 47  26% 105 104  2%

  18. Slide 18: P&L walk

    Group P&L P&L walk NIM NoII % CTI Effective Tax Rate H1FY21 1.76% 39.8% 47.3% 15.8% H1FY20 1.89% 36.8% 49.4% 21.5% YoY Growth  3%  14%  5%  1%  10% >100%  20%  41%  14%  2%  15% 109 40 35 8 711 25% 89 2 602 19% 306 75% 81% Net Interest Non-Interest Total RM’ mil Net mod loss Expenses PBP

  19. Slide 19: NIM improved as loans & deposits repriced and mod loss unwound

    NIM NIM improved as loans & deposits repriced and mod loss unwound Net Interest Margin (NIM) Movement (QoQ) YoY NIM H1FY21: Reported: 1.76% ( 13bps) Divisions Funding + Deposits Underlying: 1.80% ( 9bps) H1FY20: 1.89% bps Underlying: Reported: 5.3  12bps 6.4  33bps 11.3 7.0 2.0 14.9 1.2 10.2 2.6

  20. Slide 20: Strong trading and investment income

    NoII Strong trading and investment income YoY Growth  29%  67%  25%  32%  22%  4%  10%  >100%  97%  14% Q1FY21: 478.5 Q2FY21: 414.9 19 30 14 14 28 75 18 1 893 25 785 Corporate & Investment Group Group Treasury Wealth Business General Life RM’ mil Transaction Banking & Other Retail Funding

  21. Slide 21: Managing costs tightly

    Expenses Managing costs tightly Business Segments Q2FY21 Q1FY21 QoQ Change H1FY21 H1FY20 YoY Change (RM’ mil) Wholesale Banking 69 66  5% 134 144  7% Investment Banking 45 43  5% 88 90  2% Retail Banking 216 212  2% 428 425  1% Business Banking 34 33  3% 68 73  7% Group Funding & Others 71 6

  22. Slide 22: Loans growth driven by Retail and Business Banking

    Loans Loans growth driven by Retail and Business Banking Gross Loans Movement (RM’ bil) Breakdown by rate sensitivity: Breakdown by concept: Breakdown by customers type: ROA1: RoTA1: Fixed rate – 21% Islamic – 31% Retail – 56% 0.81% 0.83% Variable rate –79% Conventional – 69% Non-retail – 44% YTD Gr

  23. Slide 23: Credit quality

    Asset Quality Credit quality Net Impairment (YoY Movement) Gross Impaired Loans, GIL and LLC Ratios Retail Wholesale Loan Loss Coverage 1 RM’ mil Q1FY21: 49.9 Business GIL Ratio Q2FY21: 332.5 114.0% 345.2 79.7% 100.5% 93.4% 105.8% 99.9% 214.8 1.86% 1.70% 1.59% 1.73% 1.77% 1.57% RM’ mil 11.6 1,853 1,

  24. Slide 24: Maintaining vigilance over asset quality

    Asset Quality Maintaining vigilance over asset quality Impaired Loans by Sector Loans by Internal Risk Grade Sep’20 Mar’20 Strong ~ Very Strong Satisfactory ~ Moderate Marginal ~ Substandard Impaired Sector Composition YTD Growth 3% 2% RM’ mil RM’mil RM’ bil Agriculture 83 5% 85  1% Mining and quar

  25. Slide 25: Stable customer deposits, CASA trending higher

    Deposits Stable customer deposits, CASA trending higher Deposits (RM’ bil) CASA (RM’ bil) and CASA Composition (%) Customer Deposits Trend YTD Growth Industry CASA Trend YTD Growth Industry H1FY21 114.8  2%  4%1 H1FY21 34.1  18%  12%1 FY20 113.0  6%  2%2 FY20 28.8  16%  10%2 FY19 106.9  12%

  26. Slide 26: Sound capital and liquidity positions

    Capital Sound capital and liquidity positions RWA/Total Assets Capital Adequacy Ratios3 RM’ bil Total Assets RWA/Total Assets Peers 1 CET 1 Tier 1 Total CAR 2 72.2% 72.2% FHC 65.0% 2 64.4% 2 66.5% 2 16.6% 16.3% 15.8% 15.4% 59.5% 59.3% 58.4% 58.5% 57.9% 12.5% 13.6% 5 12.4% 5 13.5% 5 169.2 11.6% 11.1%

  27. Slide 27: Thank you

    THANK YOU

  28. Slide 28: Yearly performance

    H1FY21 Results Yearly performance PATMI (RM’ mil) & ROE (%) Total Income (RM’ mil) and Non-interest Income (%) PATMI ROE (%) PATMI: ROE: Total Income Total Income Non-interest Income % CAGR FY17-FY20:  0.4% CAGR FY17-FY20:  0.4% CAGR FY17-FY20:  3.9% YoY Growth  15.3% YoY Growth  1.6% YoY Growt

  29. Slide 29: Non-interest income and PATMI mix

    NoII & PATMI Non-interest income and PATMI mix Non-interest Income by Lines of Business (YoY) PATMI by Lines of Business (YoY)  29% Corporate Banking 7%  39%  >100% Group Retail Funding & Banking Group Others 36% Insurance Treasury &  67% -44% 38% Wholesale Markets  17% Banking 21% Insurance 28

  30. Slide 30: Impairments

    Asset Quality Impairments Net Impairment / (Writebacks) and GIL Ratio Total impairments by category (RM’ mil) Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 Q2FY21 QoQ Change H1FY20 H1FY21 YoY Change ECL Stage 1 & 2 / CP – Non defaulted1 (128) (38) (29) 116 31 121  >100% (166) 151  >100% ECL Stage 3 / CP – De

  31. Slide 31: Loans by sector vs industry

    Loans Loans by sector vs industry AmBank Group (RM’ bil) Loans Composition 2% 3% 12% 1% 4% 7% 3% 6% 7% 1% 54% ≈ 100% YTD Growth  9%  10%  1%  36%  3%  2%  6%  2% ≈ ≈  5%  5%  3% Sep'20 110.6 59.1 2.7 4.7 7.9 3.8 6.1 2.7 13.3 1.2 8.2 0.9 - Wholesale, Finance, Mining & Electricity, Transp

  32. Slide 32: Divisional Performance

    Divisional Performance

  33. Slide 33: Wholesale Banking

    Wholesale Banking Wholesale Banking Total Income (YoY Movement) and Total Assets by Line of Business PAT Trend (RM’ mil) QoQ Growth:  46% YoY Growth:  2% Total Income RM805 mil H1FY20: 423 H1FY21: 415  14% 269 259 Transaction 188 164 161 Banking 146 16%  6% Wholesale Banking Transaction Wholesal

  34. Slide 34: Wholesale Banking

    Wholesale Banking Wholesale Banking Income Statement YoY Growth  27%  26%  27%  7%  36%  >100%  3%  6%  2% Net Interest Non-Interest RM' mil Total Income Expenses PBP Impairment PBT Tax PAT Income Income H1FY21 557 248 805 134 671 136 535 120 415 H1FY20 440 197 636 144 492 (59) 551 127 423

  35. Slide 35: Investment Banking

    Investment Banking Investment Banking League Table Market Share of Value and Volume Traded on Bursa (KLSE)1 Market Share1 As At Trading Value Trading Volume Rank2 30 Sep 2020(%) 3.8% DCM (Overall MYR Bonds) 11.3% 4 3.6% 3.6% 3.4% 3.3% Islamic Sukuk 14.1% 4 5.5% 5.0% Unit Trust 8.2% 5 4.9% 4.8% St

  36. Slide 36: Investment Banking

    Investment Banking Investment Banking Income Statement YoY Growth  5%  25%  20%  2%  61%  >100%  74%  70%  75% Net Interest Non-Interest RM' mil Total Income Expenses PBP Impairment PBT Tax PAT Income Income H1FY21 22 144 166 88 78 (5) 83 17 66 H1FY20 23 116 139 90 48 0 48 10 38 H1FY21 PAT

  37. Slide 37: Retail Banking

    Retail Banking Retail Banking Total Income (YoY Movement) and Loans by Line of Business PAT Trend (RM’ mil) QoQ Growth:  >100% Total Income YoY Growth:  39% RM743 mil  41%  32% Others  15% 1% Retail SME H1FY20: 156 H1FY21: 217 10% Auto 15%  32% Wealth Others 7% 146 Retail SME 7% Auto 7% Cards

  38. Slide 38: Retail Banking – Cards, wealth and disbursements

    Retail Banking Retail Banking Wealth Sales (RM’ mil) Merchant Volume QoQ Growth:  46% Merchant volume (RM'mil) QoQ Growth:  47% YoY Growth:  21% YoY Growth:  52% Merchants in force ('000) QoQ Growth:  1% YoY Growth:  3% H1FY20: 1,617 H1FY21: 2,458 37 36 36 35 35 35 1,459 H1FY20: 5,147 H1FY21:

  39. Slide 39: Retail Banking

    Retail Banking Retail Banking Income Statement YoY Growth  3%  4%  2%  1%  5%  70%  39%  41%  39% Net Interest Non-Interest RM' mil Total Income Expenses PBP Impairment PBT Tax PAT Income Income H1FY21 622 121 743 428 315 29 286 69 217 H1FY20 601 125 727 426 301 96 205 49 156 H1FY21 PAT H1F

  40. Slide 40: Distribution Channels

    Retail Banking Distribution Channels Regional Branches ATM CRM2 Offices Perlis 1 3 1 Kedah 6 19 6 Pulau Pinang 14 42 15 2 Perak 18 40 21 2 Selangor 36 176 42 2 Kuala Lumpur 23 78 25 3 Putrajaya 1 4 2 Negeri Sembilan 7 39 8 1 Melaka 6 26 8 1 Johor 21 71 30 1 Pahang 8 21 11 1 Population Density Tereng

  41. Slide 41: Business Banking

    Business Banking Business Banking Gross Loans (RM’ mil) PAT Trend (RM’ mil) YTD Growth:  6% QoQ Growth:  42% YoY Growth:  53% Non-trade Trade 11,898 11,248 11,420 10,850 10,069 10,425 2,569 2,640 2,647 2,527 2,585 H1FY20: 48 H1FY21: 74 2,462 8,607 8,774 9,330 7,607 7,898 8,264 Q1FY20 Q2FY20 Q3FY2

  42. Slide 42: Business Banking

    Business Banking Business Banking Income Statement YoY Growth  1%  4%  2%  7%  2%  79%  54%  57%  53% Net Interest Non-Interest RM' mil Total Income Expenses PBP Impairment PBT Tax PAT Income Income H1FY21 132 41 173 68 105 8 97 23 74 H1FY20 134 42 177 73 104 41 63 15 48 H1FY21 PAT H1FY20 P

  43. Slide 43: Islamic Banking

    Islamic Banking Islamic Banking Income Statement YoY Growth  3%  2%  3%  >100%  50%  98%  37% RM' mil Total Income Expenses PBP Impairment PBT Tax & Zakat PATZ H1FY21 423 148 276 160 115 1 114 H1FY20 435 150 285 53 232 51 181 H1FY21 PATZ H1FY20 PATZ Positive growth in H1FY21 Contraction in H1

  44. Slide 44: General Insurance

    General Insurance General Insurance Loss Ratio and Combined Ratio PBT and PAT (RM’ mil) Loss Ratio Combined Ratio 97% 96% 92% 92% 93% 91% PBT PAT YoY PBT Growth:  7% YoY PAT Growth:  2% 282 63% 57% 58% 60% 57% 56% 260 242 FY17 FY18 FY19 FY20 H1FY20 H1FY21 192 187 Gross Premium Mix and Growth (RM’

  45. Slide 45: Insurance and Group Funding & Others

    Insurance & Others Insurance and Group Funding & Others Income Statement – Insurance (General, Life & Takaful) YoY Growth  12%  22%  2%  >100%  3%  26%  10% RM'mil Total Income Expenses PBP Impairment PBT Tax PAT H1FY21 401 208 193 (1) 193 27 166 H1FY20 359 171 188 0 188 37 151 Income Stateme

  46. Slide 46: Shareholding structure

    Corporate Structure Shareholding structure 23.8%1 AmCorp 13.0% EPF 10.9% PNB 9.1%2 Others 43.2% As at 30 September 2020 AMMB Holdings Berhad Retail Banking Wholesale Banking Islamic Banking General Insurance Life Assurance & Takaful 100% AMAB Holdings Sdn Bhd 100% AmBank (M) Berhad 51% AmGeneral Hol

  47. Slide 47: Credit ratings, target price and recommendations

    Ratings & Target Price Credit ratings, target price and recommendations Credit Ratings H1FY21 AMMB AmBank (M) AmBank Islamic AmInvestment Ratings RAM LT: AA2, ST: P1 LT: AA2, ST: P1 LT: AA2, ST: P1 LT: AA2, ST: P1 Outlook: Stable Outlook: Stable Outlook: Stable Outlook: Stable S&P LT: BBB+, ST: A-2

  48. Slide 48: Glossary & Disclaimer

    Glossary & Disclaimer Glossary & Disclaimer of warranty and limitation of liability Reported Performance Reported performance refers to the financial performance as reported in the audited financial statements and disclosed to the market Growth Definition QoQ growth refers to Q2FY21 vs Q1FY21 YoY gr

AMMB Holdings Berhad — H1 2021 Earnings Presentation on 6ix