National Development Bank Plc · CSELK:NDB.N0000

National Development Bank — H1 2021 Earnings Presentation

24 slides from National Development Bank's earnings presentation, Aug 10, 2021

  1. Slide 1: Investor Webinar H1 2021

    Investor Webinar H1 2021 National Development Bank PLC NDB.N0000 10 August 2021 10.30 am Colombo – Sri Lanka National Long Term Rating: A+(lka) Stable Outlook by Fitch Ratings Lanka Limited

  2. Slide 2: Forward Looking Statements

    FORWARD LOOKING STATEMENTS This document has been prepared by National Development Bank PLC [“NDB”, “Bank” or the “Group”] solely for use at its presentation to potential & current investors. By accepting this document, you agree to maintain absolute confidentiality regarding the information disclos

  3. Slide 3: Corporate Participants

    Corporate Participants PRESENTED BY Dimantha Seneviratne Director/ Group Chief Executive Officer Panelists Sanjaya Perera – Senior Vice President – Personal Banking, Marketing & Customer Experience Deepal Akuratiyagama – Chief Operating Officer Suvendrini Muthukumarana – Vice President – Finance Nir

  4. Slide 4: Agenda

    AGENDA PART I - CORPORATE PROFILE PART II – OPERATING ENVIRONMENT PART III – FINANCIAL PERFORMANCE – H1 2021 PART IV – OTHER STRATEGIC FOCUS AREAS PART V – WAY FORWARD PART VI – Q&A

  5. Slide 5: Part I - Corporate Profile

    PART I - CORPORATE PROFILE PART II – OPERATING ENVIRONMENT PART III – FINANCIAL PERFORMANCE – H1 2021 PART IV – OTHER STRATEGIC FOCUS AREAS PART V – WAY FORWARD PART VI – Q&A

  6. Slide 6: Part I - Corporate Profile

    PART I - CORPORATE PROFILE Our Vision The driving force for a financially empowered Sri Lanka Our Values Integrity Creativity Excellence Sincerity Accountability Dependability Our Legacy Over 40 years of service to the nation Our Team Over 3,000 NDBers across the NDB Group Our Profile Credit rating

  7. Slide 7: Part II - Operating Environment

    PART I - CORPORATE PROFILE PART II – OPERATING ENVIRONMENT PART III – FINANCIAL PERFORMANCE – H1 2021 PART IV – OTHER STRATEGIC FOCUS AREAS PART V – WAY FORWARD PART VI – Q&A

  8. Slide 8: Part II - Operating Environment

    PART II – OPERATING ENVIRONMENT Context to operating landscape that prevailed through the review period • Rising threat of the COVID-19 pandemic, with the onset of the third wave of the pandemic • Month-long travel restrictions imposed to curb the pandemic spread affecting business momentum • Q1 202

  9. Slide 9: Part III - Financial Performance H1 2021

    PART I - CORPORATE PROFILE PART II – OPERATING ENVIRONMENT PART III – FINANCIAL PERFORMANCE – H1 2021 PART IV – OTHER STRATEGIC FOCUS AREAS PART V – WAY FORWARD PART VI – Q&A

  10. Slide 10: Profitability - Performance Overview

    PART III – PERFORMANCE OVERVIEW YTD growth rates YoY growth rates Enhanced KPIs Profitability KPIs Financial position - Total assets growth by - Post tax profitability up - ROE 13.81% 6% to LKR 664 Bn by 32% to LKR 3.9 Bn [2020:13.13%] - Gross loans growth by - Profits before all taxes -Pre-tax ROA

  11. Slide 11: Income Statement Analysis - Fund Based Income

    PART III – INCOME STATEMENT ANALYSIS - FUND BASED INCOME LKR Mn H1 2021 H1 2020 Variance % Interest Income 25,461 27,255 (1,794) (7) Interest Expense 15,119 18,432 (3,313) (18) Net Interest Income 10,342 8,824 1,519 17 Trend in Market Rates and Bank NIM 11.45 10.00  NIM of 3.23% (2020: 3.07%) 8.78

  12. Slide 12: Income Statement - Non-Fund Based Income

    PART III – INCOME STATEMENT – NON-FUND BASED INCOME LKR Mn H1 2021 H1 2020 Variance % Net fee and commission income 2,580 1,739 841 48 Other non-fund based income 2,432 2,297 135 6 Total non-fund based income 5,012 4,036 976 24 Composition of Total Operating Income  Net fee and commission income dr

  13. Slide 13: Income Statement - Impairment Charges

    PART III – INCOME STATEMENT – IMPAIRMENT CHARGES LKR Mn H1 2021 H1 2020 Variance % Total impairment charges 4,152 3,176 976 31 Impairment and NPLs  Provision charges continued to increase in line with Impairment Coverage*  the growth in the loan book  provisions made at both collective and indivi

  14. Slide 14: Income Statement - Operating Expenses

    PART III – INCOME STATEMENT – OPERATING EXPENSES Cost composition % LKR Mn H1 2021 H1 2020 % H1 2021 H1 2020 Personnel expenses 2,794 2,496 12 55 54 Depreciation & amortization 428 397 8 8 8 Other expenses 1,886 1,762 7 37 38 Total operating expenses 5,108 4,655 10 100 100 Cost to Income Ratio 49.0

  15. Slide 15: Income Statement - Taxation & Profitability

    PART III – INCOME STATEMENT – TAXATION & PROFITABILITY TAXATION - LKR Mn H1 2021 H1 2020 % VAT on Financial services 1,119 965 16 Income tax 1,048 1,093 (4) Total taxes 2,167 2,058 5  Effective tax rate of 36% - Compares with a regulatory effective tax rate of 39% - 42% (FY 2020: 49%) PROFITABILITY

  16. Slide 16: Balance Sheet Performance

    PART III – BALANCE SHEET PERFORMANCE LKR Bn H1 2021 FY 2020 H1 2020 YTD YTD % YoY YOY % LKR growth growth LKR growth growth Total assets 664 627 562 37 6 102 18 Investments 158 159 121 -0.5 -1 37 31 Gross loans 487 444 429 43 10 58 14 Total deposits 515 490 428 25 5 88 21 Borrowings 80 80 81 - - -1

  17. Slide 17: Capital & Liquidity Position

    PART III –CAPITAL & LIQUIDITY POSITION Bank Group BASEL III H1 2021 FY 2020 H1 2021 FY 2020 Common Equity Tier 1 Capital Ratio % [Minimum Requirement - 10.43 9.17 10.83 9.73 6.5%] Tier 1 Capital Ratio % [Minimum Requirement – 8.0%] 10.43 9.17 10.83 9.73 Total Capital Ratio % [Minimum Requirement – 1

  18. Slide 18: Investor Ratios

    PART III – INVESTOR RATIOS Bank Group H1 2021 FY 2020 H1 2021 FY 2020 Closing price per share [LKR] 80.20 78.10 - - EPS [LKR] [Annualized] 28.89 23.77 30.96 21.99 ROE [%] [Annualized] 13.81 13.13 13.91 11.20 ROA [%] [Pre-tax] [Annualized] 1.68 1.59 1.79 1.58 Book value per Share [LKR] 161.48 192.49

  19. Slide 19: Part IV - Other Strategic Focus Areas

    PART I - CORPORATE PROFILE PART II – OPERATING ENVIRONMENT PART III – FINANCIAL PERFORMANCE – H1 2021 PART IV – OTHER STRATEGIC FOCUS AREAS PART V – WAY FORWARD PART VI – Q&A

  20. Slide 20: Other Strategic Focus Areas

    PART IV – OTHER STRATEGIC FOCUS AREAS  Investments in technology and new upgrades to NEOS  CRIB Score and CRIB Report downloadable via NEOS App  First bank to commence the development of vKYC, using AI  Support to pandemic affected customers through a host of initiatives  Jayagamu Sri Lanka  M

  21. Slide 21: Part V - Way Forward

    PART I - CORPORATE PROFILE PART II – OPERATING ENVIRONMENT PART III – FINANCIAL PERFORMANCE H1 2021 PART IV – OTHER STRATEGIC FOCUS AREAS PART V – WAY FORWARD PART VI – Q&A

  22. Slide 22: Way Forward

    PART V – WAY FORWARD Mid-Tem Strategy guiding For customer solutions the NDB Group towards VOYAGE Digital and process “The Banking Group of 2025 Drive efficiencies Choice” Committed to support Through technology driven customers and COVID-19 Cost automations to support national economic Support Effi

  23. Slide 23: Part VI - Q&A

    PART I - CORPORATE PROFILE PART II – MACRO-OPERATING ENVIRONMENT PART III – NDB FINANCIAL PERFORMANCE – H1 2021 PART IV – OTHER STRATEGIC FOCUS AREAS PART V – WAY FORWARD PART VI – Q&A Please use the chat option in the MS Teams window to pose your questions to the GCEO and Panel. 23

  24. Slide 24: NDB Investor Relations

    Analysts Support  Clearly defined Quarterly Results Calendar released at the end of each quarter  Webinar transcripts hosted to the NDB NDB Investor Relations Corporate website/ IR page in playback video and written transcript forms  Dedicated communication channels made available for any queries

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