First Abu Dhabi Bank · ADX:FAB
First Abu Dhabi Bank — Q4 2019 Earnings Presentation
25 slides from First Abu Dhabi Bank's earnings presentation, Jan 27, 2020
Slide 1: Q4/FY’19 Earnings Presentation
Q4/FY’19 Earnings Presentation 27 January 2020
Slide 2: Disclaimer
Disclaimer Comparative figures have been reclassified where appropriate to conform to the presentation and accounting policies adopted in the consolidated financial statements. The information contained herein has been prepared by First Abu Dhabi Bank P.J.S.C (“FAB”). FAB relies on information obtai
Slide 3: Q4/FY’19 performance key highlights
Q4 /FY’19 performance key highlights Solid financial performance in a year of growth and transformation • FY’19 NPAT +4% yoy, in line with guidance • Revenue +4% yoy, underpinned by solid underlying performance of our core businesses Continuing to maximise shareholder returns • Proposed FY’19 DPS of
Slide 4: We met NPAT guidance…
We met NPAT guidance… FY’19 financial guidance FY’19 actual • Strong Govt/GRE-led growth and good momentum in PBG; sequential growth Loan High single digit +16% yoy primarily driven by a large short term facility GROWTH • Solid underlying performance of our core businesses in a challenging market; R
Slide 5: …through revenue growth, cost and risk discipline
…through revenue growth, cost and risk discipline Net profit bridge (AED Mn) & RoRWA (%) 2.46% +10 bps 2.56% RoRWA RoRWA • NPAT growth was driven by the 12,520 solid underlying performance +803 (170) (6) of our core businesses in a (117) 12,011 challenging environment marked by a reversal in the int
Slide 6: Strong capital generation, robust payout
Strong capital generation, robust payout CET11 ratio progression yoy • Enhanced CET1 yoy on the back of higher vs. >13% CET1 Guidance retained earnings and RWA discipline pre-dividend (-1.5% yoy vs. 10% asset growth) +0.06% 15.2% • Proposed FY’19 cash dividend of 74 fils / 14.0% Proposed 1.7% share,
Slide 7: Making significant progress against our strategic priorities
Making significant progress against our strategic priorities Disciplined Efficiency & Leadership & Growth Transformation Strength • Market share gains across key • Invested in key areas to accelerate • Key enabler to Abu Dhabi’s economic segments in UAE; outperformed transformation and enable agilit
Slide 8: Significantly improved customer experience, digital capabilities, and culture in our first year as ‘One Bank’
Significantly improved customer experience, digital capabilities, and culture in our first year as ‘One Bank’ • >50% increase in mobile registrations and engagement yoy • Consistent improvement in NPS scores throughout 2019 • Successful migration of key services to mobile; 4x increase in digital tra
Slide 9: Strong balance sheet growth
Strong balance sheet growth Loans and advances, net (AED Bn) QoQ↑8%, YoY↑16% 377.8 407.9 353.0 359.0 366.0 0.2 • Loans and advances (net) were up 16% yoy (+55Bn) primarily 0.8 0.1 driven by CIB, while PBG showed positive momentum in the 1.2 1.0 97.7 95.4 first year post system integration 94.7 94.9
Slide 10: NII and margin trends
NII and margin trends Net interest income (AED Mn) QoQ↓9%, YoY↓7% YoY↓2% Quarterly YTD 13,030 12,775 3,275 3,301 3,329 3,114 3,031 Net interest margin (%) 2.36 2.25 2.19 2.11 2.21 2.16 2.21 2.17 1.89 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 FY'18 FY'19 loan yields (%) Performing 4.91 5.04 4.84 Key highlights 4
Slide 11: Continued strength in non-interest income
Continued strength in non-interest income Non-interest income (AED Mn) Net F&C income Net FX & Investment inc Other income QoQ↑18%, YoY↑33% YoY↑16% Key drivers 7,474 2,050 6,416 Fees & commissions were 7% lower yoy mainly due to lower trade-related fees, partly offset by strong 1,828 1,852 1,744 3,1
Slide 12: Cost leadership despite ongoing transformation
Cost leadership despite ongoing transformation Opex drivers yoy (AED Mn) • xxx • Operating expenses were up 3% yoy, reflecting cost 5,499 discipline amidst investments to grow our +49 +127 international franchise, enhance digital capabilities, 5,329 and create future efficiencies (221) +216 • FY’19
Slide 13: Healthy asset quality
Healthy asset quality Impairment charges, net (AED Mn) & CoR1 NPLs and Provisions(AED Bn) Net impairment charges CoR (L&A) (bps) NPLs Provision Coverage (%) Provisions NPL Ratio (%) 50 49 50 48 48 48 38 1,726 1,843 467 469 499 110 106 111 109 428 407 93 3.15 3.27 3.09 3.23 3.06 Q4'18 Q1'19 Q2'19 Q3'
Slide 14: 2020 outlook
2020 outlook In the current environment,… … our strategy execution will be focused on: • Global backdrop impacted by persistent • Maintaining cost and risk discipline market uncertainties • Strengthening our leading position in the • Lower interest rate environment UAE by growing market share in cho
Slide 15: 2020 financial guidance
2020 financial guidance 2020 financial guidance metrics • Govt/GRE-led growth in the UAE, continued Broadly flat* yoy Loan growth *high single-digit excluding large positive momentum in PBG short-term facility in Q4’19 GROWTH • Softer revenue environment due to rate cuts • Business growth, continued
Slide 16: Wrapping up
Wrapping up Solid financial performance in the first year of growth and transformation Market-leading franchise, diversified business profile, strong fundamentals and superior credit ratings We are making significant progress against our strategic priorities both in the UAE and key strategic markets
Slide 17: Appendix
Jol nubod iy onc’ FAB First Abu Dhabi Bank Appendix
Slide 18: Segmental performance (by business)
Segmental performance (by business) Corporate & Investment Banking (CIB) of Group 55% Revenue In AED Mn FY’19 YoY % • CIB Revenue up 11% yoy driven by strong performances across: Revenues 11,233 11 › Global Markets (+33%), on the back of higher returns from investment and ALM Operating expenses (2,0
Slide 19: Segmental performance (by geography)
Segmental performance (by geography) UAE 86% of Group In AED Mn FY’19 YoY % Revenue Revenues 17,353 4 • Revenue and profitability from UAE continue to improve • Revenues grew 4% yoy, contributing 86% to Group revenue, while operating Operating expenses (4,385) ↔ expenses were flat you on the back of
Slide 20: Asset & loan mix
Asset & loan mix Asset Mix Gross loans by counterparty (AED Bn) Dec’19 AED 822.0Bn 8% 421.7 Banking Sector Cash & CB Balances 366.8 21% 16% 6% Personal/Retail 9% DFB and Reverse 8% Repos 17% Sector 14% 25% 20% Dec’18 Loans and Advances Corporate/Private AED 5% Sector 743.9Bn 5% 46% Investments 51% P
Slide 21: Investments breakdown
Investments breakdown Investments by type Investments by ratings A BBB HFT - Debt 9% 13% HFT - Equity & 30% Funds BB & below 2% 12% AFS - Debt AED 134.7Bn Held to Maturity AED 134.7Bn Dec'19 (Debt) Dec'19 81% 4% Unrated - Debt 5% AFS - Equity & Funds Equity & Funds AA 2% 0.5% 30% AAA 12% Investments
Slide 22: Customer deposits
Customer deposits Customer deposits (AED Bn) Customer deposits by account type (AED Bn) Notice and time deposits Current Accounts 2 Total Customer Deposits CASA Saving Accounts Certificates of deposits 519.2 Margin Accounts 465.2 432.8 462.2 476.8 465.2 519.2 1% 1% 6% 6% 3% 2% 32% 32% 58% 60% 35% 37
Slide 23: Liability mix and funding profile
Liability mix and funding profile Liability Mix Medium-term wholesale funding (AED Bn) Term MTNs Borrowings Medium Term Notes 48.5 & Sub Debt Sukuks 8% Subordinated debt 0.4 Others 6% Sukuks 7.2 AED 713.9Bn 4.7 Due to 16.1 Dec'19 10.6 Banks & Repos Subordinated debt 0.4 7.7 2.5 10% 6.9 1.3 2.5 3.5 C
Slide 24: Q4/FY’19 Financial Highlights
Q4/FY’19 Financial Highlights P&L summary In AED Mn Q4’19 Q3’19 QoQ% Q4’18 YoY% FY’19 FY’18 YoY% Revenue 5,081 5,073 0 4,810 6 20,249 19,446 4 Operating expenses (1,415) (1,405) 1 (1,355) 4 (5,499) (5,329) 3 Impairment charges (499) (469) 6 (428) 17 (1,843) (1,726) 7 Net profit (after minority inter
Slide 25: THANK YOU!
THANK YOU! For more information, please visit www.bankfab.com or contact FAB Investor Relations team at ir@bankfab.com You can also download FAB’s Investor Relations App from App Store /Google Play to access latest corporate updates, FAB pro forma financial information and FGB/NBAD archives. Scan to