Saudi National Bank · TADAWUL:1180
Saudi National Bank — Q1 2021 Earnings Presentation
34 slides from Saudi National Bank's earnings presentation, Jul 29, 2021
Slide 1: 1Q 2021 Results
Earnings Presentation 1Q 2021 Results Saudi National Bank sagsuull Lait clint sgailon
Slide 2: Disclaimer
The Saudi National Bank (SNB) prepared this presentation on a proprietary basis as general background information about the activities of SNB. The information contained herein is given in summary form and for discussion purposes only. Some of the information that is relied upon by SNB is obtained fr
Slide 3: 1Q 2021 Results Earnings Call
1Q 2021 Results Earnings Call 1 SNB Merger Update 2 NCB Group Stand-Alone 1Q 2021 Performance 3 Q&A SNB Investor Relations | 1Q 2021 Earnings Presentation 3
Slide 4: Merger Update
Merger Update SNB Investor Relations | 1Q 2021 Earnings Presentation 4
Slide 5: Seizing a unique consolidation opportunity
Seizing a unique consolidation opportunity 1 Forming a new Saudi banking champion and regional powerhouse 2 Prudent governance framework and new operating model with focus on Wholesale and Retail Banking 3 Greater client and product focus to position the Bank for sustainable growth 4 Balanced income
Slide 6: NCB and Samba merged through a statutory merger process
NCB and Samba merged through a statutory merger process Overview of completed merger process Post-merger shareholding structure All assets and liabilities of Samba were transferred to NCB in exchange for 0.739 NCB share for every Samba share held by Samba Shareholders. Pro-forma shareholding structu
Slide 7: Merger benefits shareholders and delivers on strategic goals
Merger benefits shareholders and delivers on strategic goals On track to deliver New Saudi banking ~SAR 800mn cost champion and regional synergies powerhouse Revenue Synergies Well-diversified assessment Financial Strategic franchise and robust ongoing Rationale Rational balance sheet to pursue acce
Slide 8: Forming a new Saudi banking champion & regional powerhouse
Forming a new Saudi banking champion & regional powerhouse The clear #1 Saudi Bank by Total Assets FY 2020 Total Assets (SARbn) 0 200 400 600 800 1,000 SNB 896 #1 KSA bank with ~30% market share and SAR 896 bn total assets NCB 599 The merger brings together two highly complementary banks Al Rajhi
Slide 9: Leading the KSA market across all key financial metrics
Leading the KSA market across all key financial metrics FY 2020 #1 Total Assets #1 Financing & Advances #1 Customers' Deposits #1 Operating income #1 Net income after Zakat & tax 0 200 400 600 800 1,000 0 200 400 600 800 1,000 0 5 10 15 20 25 30 35 40 0 200 400 600 800 1,000 (10) (5) 0 5 10 15 20 SN
Slide 10: Well-balanced income model and well-diversified loan and deposit mix for SNB
Well-balanced income model and well-diversified loan and deposit mix for SNB Operating Income by Segment Financing and Advances, Net Customers' Deposits FY2020 FY2020 FY2020 SAR 21.5bn SAR 9.4bn SAR 30.9bn SAR 346.6bn SAR 156.0bn SAR 502.6bn 50% SAR 416.4bn SAR 207.7bn SAR 624.1bn 1 50% 0.9 24% 45%
Slide 11: New Bank focused on Retail and Wholesale
New Bank focused on Retail and Wholesale Retail Banking Wholesale Banking International SNB Capital Consumer & Business Corporate Banking Banking Türkiye Finans Katılım Bankası, TFKB Samba Capital will be Institutional Banking* (Subsidiary, Turkey) merging with NCB Capital to consolidate their Asset
Slide 12: Integration governance in place with work streams across all areas
Integration governance in place with work streams across all areas of the organizational structure Includes master planning, synergy management, overseeing of communications, Integration Management Office (IMO) branding, marketing, and culture change & management Retail Wholesale Capital Control and
Slide 13: Accelerated progress on all key work streams leading to moving Operational Day 1 sooner
Accelerated progress on all key work streams leading to moving Operational Day 1 sooner (from planned H2 2022 to YE 2021) Merger SNB Operational and Merger Signed SNB LD1 SNB Capital LD1 Announcement New Brand Launch Customer Day 1 Jun 2020 Oct 2020 Apr 2021 Jun 2021 Jul 2021 December 2021 Board,
Slide 14: NCB Group stand-alone 1Q 2021 Results
NCB Group stand-alone 1Q 2021 Results SNB Investor Relations | 1Q 2021 Earnings Presentation 14
Slide 15: Banking sector record quarterly Net Income in 1Q 2021
Banking sector record quarterly Net Income in 1Q 2021; Effective progress delivered on strategic priorities 1Q 2021 NCB Performance Operating Income (SAR bn) Net Income (SAR bn) Financing, net (SAR bn) Current Accounts (SAR bn) 5,773 +9% 3,408 +20% 347 357 +3% 319 331 +4% YoY YoY 4Q 20 1Q 21 4Q 20 1
Slide 16: NCB standalone delivered a record financial performance for 1Q 2021
NCB standalone delivered a record financial performance for 1Q 2021 with 20% net income growth and 18.5% ROE Total Assets Net Income after Zakat & ROA T1 Capital Ratio Cost to Income Ratio (SAR bn) tax (SAR mn) 31.9% 28.1% 2.3% +8 bps 599.6 +0% 20.0% +0.7% 3,408 +20% -379 bps YoY YTD YTD YoY YoY 1Q
Slide 17: Stable balance sheet as financing and investments growth offset lower SAMA balances
Stable balance sheet as financing and investments growth offset by lower balances with SAMA and other assets Movement in Assets (SARbn) Total Assets Composition (SARbn) 80% 1,000 +0% 70% 535 599 600 43 37 31 60% 900 50% 54 70 150 62 133 145 40% 800 30% 305 347 357 20% 4.8 700 599.4 10.0 599.6 10% 0%
Slide 18: Financing growth of 3% from strong mortgage growth
Financing growth of 3% from strong mortgage growth Movement in Financing (SARbn) Retail (SARbn) 400 350 174 189 159 300 +3% 250 130 138 200 140 150 3.0 100 12.1 356.7 50 0 120 346.7 1Q 20 2Q 20 3Q 20 4Q 20 1Q 21 (2.3) (1.4) (1.3) 100 Corporate (SARbn) 450 400 350 138 139 140 300 133 130 80 250 200 1
Slide 19: SAR 3.3bn Increase in investment grade securities
SAR 3.3bn Increase in investment grade securities; 84% of portfolio investment grade Movement in Investments (SARbn) Investments by Credit Grade (SARbn) 120 +3% Equity & others Saudi Government 8% securities 145 150 100 300 250 Non-investment 50% 200 1.4 149.7 150 3.5 0.1 100 144.9 50 grade 0 80 4Q
Slide 20: Funding mix improved due to higher CASA balances
Funding mix improved due to higher CASA balances Movement in Funding (SARbn) Total Liabilities Mix (SARbn) Debt Interbank 250 +0% 1% 1,000 14% 5… 5… 13.8 800 Other 600 599.4 2.3 1.4 0.4 0.3 4.0 599.6 400 200 4% 200 0 4Q 20 1Q 21 (12.7) (2.2) (2.7) (4.5) 150 Customers' deposits 81% International Depo
Slide 21: Strong net income growth, driven by operating income
Strong net income growth, driven by operating income; healthy ROE and ROA on profitable deployment of equity and assets Net Income after Zakat and Income Tax attributed to Equity Holders ROE (%) -1 bps 1 (SARmn) 0 0 18.5% 18.5% 2,000.00 0 +20.3% 0 0 0 1,800.00 0 116 0 0 70 20 3,408 0 1,600.00 446 1Q
Slide 22: Net special commission income grew 1% YoY
Net special commission income grew 1% YoY; NSCI margin decrease due to rate cuts in 1Q 2020 Movement in Net Special Commission Income (SARmn) & NSCI Margin (%) NSCI margin 0 0 3.7% 0 3.6% 3,000 3.73% +28 bps -61 bps -10 bps -28 bps +27 bps +6 bps -0 bps -14 bps 3.21% 0 3.5% 3.5% 3.2% 0 1.8% 0.8% 0 2
Slide 23: Fee and other income increased from improved investment-related revenue
Fee and other income increased from improved investment- related revenue and brokerage income Fee and Other Income Movement (SARmn) Fee from banking services (SARmn) * 1,400 2,000 1,200 682 621 572 525 1,000 1,800 800 480 +39% 600 400 1,600 200 374 1,594 0 1Q 20 2Q 20 3Q 20 4Q 20 1Q 21 1,400 75 Inte
Slide 24: 4% reduction in operating expenses; cost-to-income ratio below 30%
4% reduction in operating expenses; further improvements to cost-to-income ratio reaching below 30% Operating Expenses Movement (SARmn) Cost to Income Ratio (YTD %) 0 1,400 -4% 1,200 0 1,692 4 6 32.0% 1,622 31.9% 201 1,000 183 30.9% 0 (42) International 800 (39) 30.3% 0 30.9% 31.0% 600 30.0% 28.1% 2
Slide 25: Retail CoR improvement; increased Corporate impairments
Retail CoR improvement on portfolio quality & collections; Proactive risk assessment contributed to increased Corporate impairments Movement in Impairments (SARmn) Group 0.8% 0 0.6% 0.7% 0.6% 0.4% 0 800 -16% 0 0 1Q 20 1H 20 9M 20 FY 20 1Q 21 700 Retail 0 600 336 3 0.3% 0.3% 0.2% 0 0 0.0% 500 415 0 -
Slide 26: Credit quality remained stable; Provision coverage improved 5%
Credit quality remained stable; Provision coverage improved 5% on enhanced International portfolio coverage Movement in NPLs (SARmn) Group 140% 0 200% 0 141% 143% 143% 145% 180% 0 160% 0 140% 9,000 0 120% +1% 0 1.7% 1.8% 1.7% 1.7% 1.7% 100% 8,000 6,128 31 116 6,163 Retail 280% 0 7,000 0.5% 244% 300%
Slide 27: Capital position comfortably above regulatory minima
Capital position comfortably above regulatory minima; strong liquidity profile maintained Capital Ratios (%) NSFR Ratio (%) 2 582 0 21.1% 2 482 20.3% 120.0% 121.2% 122.7% 121.7% 2 117.1% 0 382 1 282 0 1 19.1% 18.9% 182 20.0% 1 0 82 1 19.3% 1 (18) 0 18.1% 1Q 20 2Q 20 3Q 20 4Q 20 1Q 21 16.8% 0 17.9% 1
Slide 28: Q&A Session
Q&A Session SNB Investor Relations | 1Q 2021 Earnings Presentation 28
Slide 29: Additional Information
Additional Information SNB Investor Relations | 1Q 2021 Earnings Presentation 29
Slide 30: SNB welcomes your feedback and inquiries
SNB welcomes your feedback and inquiries Contact Us More Information The Saudi National Bank Tower, Unit No. 778 Visit: http://www.alahli.com/en-us/Investor_Relation King Abdullah Financial District to access SNB’s current and previous Investor Publications including: 3208, Al Aqeeq District, King F
Slide 31: SNB Investor Relations | 1Q 2021 Earnings Presentation
SNB Investor Relations | 1Q 2021 Earnings Presentation 31
Slide 32: Merged bank governance model
Merged bank governance model Board committees Shareholder meetings GCEO-led management committees (GAM – EGAM) Other non-GCEO management committees Board of Directors Compensation, Nomination Executive Committee EXCO Audit Committee Risk Committee & Governance Committee Managing Director and Group C
Slide 33: Board of Directors
Chairman Vice Chairman MD & Group CEO Ammar Al Khudairy Yazeed Al Humied Saeed Al Ghamdi Board Member Board Member Board Member Rashid Sharif Ibrahim Al Mojel Abdulrahman Alodan Board Member Board Member Board Member Sheila Alrowaili Saud Al Juhani Ziad Tunsi Board Member Board Member Abdullah Alrow
Slide 34: Executive management
MD & Group CEO CEO Wholesale Bank CEO Retail Bank Saeed Al Ghamdi Talal Al Khereji Majed Al Ghamdi Advisor to Group Chief Group Chief Group Chief Human MD & GCEO Financial Officer Risk Officer Resources Officer Mohammed Al Shaikh Ahmad Al Dhabi Naif Al Bashir Mutlaq Al Anezi Group Chief Digital Grou