30 slides from Emirates Nbd Bank (p.j.s.c)'s earnings presentation, November 2016
Slide 1: Emirates NBD Investor Presentation
Emirates NBD Investor Presentation November 2016
Slide 2: Important Information
2 Important Information Disclaimer The material in this presentation is general background information about the activities of Emirates NBD Bank PJSC (Emirates NBD), current at the date of this presentation, and believed by Emirates NBD to be accurate and true. It is information given in summary for
Slide 3: UAE Economic Update
Operating Environment 3 UAE Economic Update Highlights Real GDP growth forecasts • UAE economy grew 3.8% in 2015. Non oil sector growth 2013 2014 2015 2016F 2017F slowed to 3.3% last year from 5.3% in 2014. S. Arabia 2.7 3.4 3.4 1.4 1.8 UAE 4.6 3.1 3.8 3.0 3.4 • Oil output in the UAE rose 1.7% y/y i
Slide 4: Dubai Economic Update (1/3)
Operating Environment 4 Dubai Economic Update (1/3) Highlights Dubai: Real GDP growth • Dubai’s economy expanded 4.1% y/y in 2015, up from 6.0 5.2 3.5% in 2014. Wholesale & retail trade remains the largest 5.0 4.6 sector in the economy, and expanded 4.0% in 2015. 4.0 4.2 3.9 Hospitality (restaurant
Slide 5: Dubai Economic Update (2/3)
Operating Environment 5 Dubai Economic Update (2/3) Highlights Dubai Airports passenger traffic • Passenger traffic at the Dubai International Airport (DXB) rose 45 mn people thousand tons 1800 to 55.9 million in Jan-Aug 2016, up by 7.0% y/y. 40 1700 1600 • Passenger traffic is expected to exceed 85
Slide 6: Dubai Economic Update (3/3)
Operating Environment 6 Dubai Economic Update (3/3) Highlights Business licenses issued* • Dubai residential real estate prices have eased further in 160 12 September 2016, although the rate of decline has slowed business licences % y/y since the beginning of 2016. 10 Thousands 140 • Rents have decl
Slide 7: UAE Banking Market Update
Operating Environment 7 UAE Banking Market Update Highlights Bank deposit and loan growth • M2 growth increased by 3.6% y/y/ in September 2016. Bank Loans (% y/y) Bank deposits (% y/y) AD ratio (RHS) 18% 110% M3 (M2 +Govt. deposits) also increased by 3.5% y/y for the 16% same month. 14% 105% 12% 100
Slide 8: Emirates NBD at a glance
8 Emirates NBD at a glance Operating Environment #1 bank in the UAE Largest branch network in the UAE • Market share in the UAE (as at 30 September 2016) Dubai 101 Ras al-Khaimah (5) - Assets 17.5%; Loans 20.0%; Deposits 20.7% Abu Dhabi 25 Sharjah 18 Umm al-Quwain (2) Other Emirates 11 Fujairah (2)
Slide 9: Emirates NBD is the largest bank in the UAE
9 Emirates NBD is the largest bank in the UAE Operating Environment x% 9M -16 vs. 9M -15 x% Q3-16 vs. Q4-15 Operating Income Net Profit Loans Total Deposits AED Mn, 9M-16 AED Mn, 9M-16 AED Bn, Q3-16 AED Bn, Q3-16 Emirates NBD Profile 11,285 1% 5,382 8% 289 7% EMIRATES 312 8% 8,094 1% 6% 205 (0%) NBA
Slide 10: Emirates NBD is among top banks in the GCC
10 Emirates NBD is among top 3 banks in the GCC by Operating Income, Net Profit, Operating Environment Loans and Deposits in 2015 x% 2015 vs. 2014 Operating Income Net Profit Loans Total Deposits USD Bn, 2015 USD Bn, 2015 USD Bn, 2015 USD Bn, 2015 Emirates NBD Profile 4.6 8% 3.1 8% 109 15% 109 10% 4
Slide 11: Profit and Balance Sheet Growth in Recent Years
Operating Environment 11 Profit and Balance Sheet Growth in Recent Years Revenues and Costs (AED Bn) Profits (AED Bn) Revenues Costs Pre-Provision Operating Profits Net Profits +11% +7% +14% 14.4 15.1 4.7 10.1 10.5 7.2 Emirates NBD Profile 4.4 +30% 4.2 11.9 3.6 3.9 11.3 +1% 3.6 3.8 1.3 3.7 2.7 -3% +
Slide 12: Emirates NBD delivered a solid set of results in Q3-16 amid a challenging environment
12 Emirates NBD delivered a solid set of results in Q3-16 amid a challenging Operating Environment environment Q3 2016 YTD at a glance 2016 Macro themes Q3 2016 vs. Regional Global YTD revised 2016 guidance • Resilience of UAE • Recovering US Emirates NBD Profile Profitability Net profit AED 5.4 Bn
Slide 13: Q3-16 YTD Financial Results
Operating Environment 13 Q3-16 YTD Financial Results Highlights Key Performance Indicators • Net profit of AED 5,382 million for Q3-16 YTD improved Better / AED Mn Q3-16 YTD Q3-15 YTD 8% y-o-y (Worse) Net interest income 7,651 7,572 1% • Net interest income improved 1% y-o-y as loan growth Emirates
Slide 14: Q3-16 Financial Results Highlights
Operating Environment 14 Q3-16 Financial Results Highlights Highlights Key Performance Indicators • Net profit of AED 1,664 million for Q3-16 declined 1% Better / Better / AED Mn Q3-16 Q3-15 Q2-16 y-o-y and 13% q-o-q (Worse) (Worse) Net interest income 2,551 2,591 (2%) 2,544 0% • Net interest income
Slide 15: Net Interest Income
Operating Environment 15 Net Interest Income Highlights Net Interest Margin (%) 2.95 • NIMs declined to 2.54% in 2016 YTD and to 2.44% in Q3-16 2.91 2.90 • Loan spreads declined as loan margins across a range of 2.83 2.83 2.85 products did not keep pace with rising EIBOR rates 2.80 2.76 2.75 2.78 Em
Slide 16: Non-Interest Income
Operating Environment 16 Non-Interest Income Highlights Composition of Non Interest Income (AED Mn) • Non-interest income grew 1% y-o-y due to higher core Better / AED Mn Q3-16 YTD Q3-15 YTD fee income (Worse) • Core fee income improved 2% y-o-y driven by growth in Core gross fee income 3,811 3,630
Slide 17: Operating Costs and Efficiency
Operating Environment 17 Operating Costs and Efficiency Highlights Cost to Income Ratio (%) • In Q3-16, costs improved by 1% q-o-q, helped 33.3 33.7 by a further reduction in staff costs, following 32.6 cost control measures implemented earlier in 32.0 Emirates NBD Profile 2016. 32.7 31.3 31.0 • Cos
Slide 18: Credit Quality
Operating Environment 18 Credit Quality Highlights Impaired Loan & Coverage Ratios (%) 118.5 120.8 • NPL ratio improved to 6.4% 111.5 113.5 99.6 • Impaired loans improved to AED 20.1 Bn helped by AED 2,129 Mn of write backs & recoveries in Q3-16 YTD 76.1 Emirates NBD Profile 66.2 59.8 57.5 • Q3-16 Y
Slide 19: Capital Adequacy
Operating Environment 19 Capital Adequacy Highlights Capitalisation 20.9 20.7 20.3 20.5 20.5 • In Q3-16, Tier 1 ratio increased by 0.1% to 18.0% and CAR remained at 20.5%. 18.0 18.0 17.6 17.9 18.0 • Increase in Tier 1 capital from retained earnings more than Emirates NBD Profile 50.9 50.2 51.8 53.5
Slide 20: Funding and Liquidity
Operating Environment 20 Funding and Liquidity Highlights Advances to Deposit (AD) Ratio (%) • AD ratio of 92.8% within 90-100% management target range 118.5 • Liquid assets* of AED 53.9 Bn as at Q3-16 YTD (13.7% of total liabilities) Emirates NBD Profile • Debt & Sukuk term funding represent 12% of
Slide 21: Loan and Deposit Trends
Operating Environment 21 Loan and Deposit Trends Highlights Trend in Gross Loans by Type (AED Bn) +7% • Gross loans grew 7% since end 2015 with good growth in Consumer and 313 +1% 303 310 Islamic lending 285 294 Emirates NBD Profile 272 279 265 267 271 221 225 226 215 • Islamic financing grew 11% si
Slide 22: Loan Composition
Operating Environment 22 Loan Composition Total Gross Loans (AED 313 bn) Corporate Loans (AED 98 bn) Treasury/Other Cont. Corporate Trans. & com. Retail 7% 98 4% 33 RE Emirates NBD Profile (11%) 0 (31%) 32% Trade 15% (0%) 8% 53 Manuf. 2% 129 (17%) 5% (41%) Islamic* Others** 22% 4% Per. - Corp. Finan
Slide 23: Divisional Performance
Operating Environment 23 Divisional Performance • RBWM revenues declined 1% q-o-q Balance Sheet Trends Revenue Trends • In Q3-16 YTD, fee income accounted for 37% of total AED Bn +18% AED Mn RBWM revenue, compared to 30% in 2013 -1% Wealth Management • Retail loans grew by 12% and deposits by 18% fr
Slide 24: Divisional Performance (cont'd)
24 Divisional Performance (cont’d) Operating Environment • Wholesale Banking revenues declined 9% q-o-q Balance Sheet Trends Revenue Trends • Loans grew 5% from end 2015 AED Bn -5% AED Mn • Deposits declined 5% from end 2015, reflecting +5% -9% Wholesale Banking continued efforts to reduce the avera
Slide 25: Emirates NBD's core strategy is focused on the following building blocks
25 Emirates NBD’s core strategy is focused on the following building blocks Operating Environment Key Deliver an excellent customer Emirates NBD Profile Objective experience Financial & Operating Performance Strategic Run an Drive Levers Drive core efficient geographic business organization expansio
Slide 26: Strategic priorities for 2016
26 Strategic priorities for 2016 Operating Environment Pillars of our strategy Key focus areas 1 • Extend servicing of products through online, mobile, social channels Deliver an excellent • Reinforce ENBD’s position as a digital innovator in the region via best-in-class online and mobile banking cu
Slide 27: 2015 & 2016 Selected Awards
27 2015 & 2016 Selected Awards Operating Environment ‘Commercial banking ‘Best Bank in the Middle East’ Capabilities in the UAE’ ‘Best Digital Bank in the ‘Innovative Technology – Emirates NBD Profile ‘Best Prepaid Program – ‘#1 Financial Services Brand Middle East’ Emirates Islamic’ Client Experien
Slide 28: Large Deals Concluded in Q3 2016 YTD (1/2)
28 Large Deals Concluded in Q3 2016 YTD (1/2) Operating Environment GOVERNMENT OF SRI STANBIC BANK UGANDA ATLANTIS THE PALM 2 DUBAI SILICON OASIS SEKERBANK LANKA LIMITED (DIFC) LTD AUTHORITY USD 18,000,000 AND EUR USD 700,000,000 USD 55,000,000 USD 50,000,000 & AED AED 1,000,000,000 99,500,000 2,938
Slide 29: Large Deals Concluded in Q3 2016 YTD (2/2)
29 Large Deals Concluded in Q3 2016 YTD (2/2) Operating Environment THE STANDARD BANK OF SHARJAH ISLAMIC BANK CFC STANBIC BANK TETRA HOSPITALITY T S GLOBAL HOLDINGS SOUTH AFRICA LIMITED LIMITED INVESTMENTS LLC PTE LIMITED USD 265,000,000 USD 1,000,000,000 USD 135,000,000 AED 2,482,000,000 USD 1,500,
Slide 30: Investor Relations
Investor Relations PO Box 777 Emirates NBD Head Office, 4th Floor Dubai, UAE Tel: +971 4 201 2606 Email: IR@emiratesnbd.com