Al Rajhi Bank · TADAWUL:1120

Al Rajhi Bank — Q4 2017 Earnings Presentation

29 slides from Al Rajhi Bank's earnings presentation, Apr 4, 2018

  1. Slide 1: Investor Relations Presentation Q4 2017

    Investor Relations Presentation Q4 2017

  2. Slide 2: Table of Content

    Table of Content 1 KSA Fact Sheet 3 16 Al Rajhi’s NPS Score 18 2 Saudi Arabia 2030 Vision 4 17 Al Rajhi’s Market Shares Trends 19 3 Al Rajhi at a Glance 5 18 Operating Income & Net Income by Segments 20 4 Presence & Business Segments 6 19 Loans, Deposits, & Revenues Compositions 21 5 Al Rajhi Bank S

  3. Slide 3: KSA Fact Sheet

    KSA Fact Sheet Saudi Arabia holds 49% of the Saudi population one-fith of the world’s of 20.4 million is under proven oil reserves the age of 25, with a young It is the world’s largest producer population entering the workforce and exporter of petroleum for the first time The Kingdom is a member of th

  4. Slide 4: Saudi Arabia 2030 Vision

    Saudi Arabia 2030 Vision A Vibrant Society A Thriving Economy An Ambitious Nation • Increase Umrah capacity from • Lower unemployment from • Rise in Global Competitive- • Increase non-oil government 8 to 30M 11.6% to 7% ness Index from 25 to top 10 revenue from SAR 163B to 1T • Double the number of

  5. Slide 5: Al Rajhi at a Glance

    Al Rajhi at a Glance The Largest Customer Base in KSA 9 million The Largest Network in the Middle East 577 Branches 4,794 ATMs 74,612 POS 4 of every 10 transactions in KSA 70 million+ Transactions processed per month #1 Bank for Remittance in the region 21 million+ Remittances Liquid and Low cost of

  6. Slide 6: Presence & Business Segments

    Presence & Business Segments Kuwait Segments Contributions Jordan (7) (٢) To The Operating Income Corporate Treasury 15% 8% Investment 3% Retail Saudi Arabia Malaysia 74% (Number of Branches) (577) (١8) Retail Banking • Personal Finance Corporate • Transactional Banking Treasury • Treasury services

  7. Slide 7: Al Rajhi's Strengths

    Al Rajhi’s Strengths The highest Non-Commission Bearing ROA% above the market Deposits % of Total Deposits within the market 2.67% 94.2% 1.97% 60.4% Al Rajhi Competition* Al Rajhi Competition* Net Commission Margin well above the market ROE% above the market 4.16% 16.94% 3.07% 13.10% Al Rajhi Compet

  8. Slide 8: Al Rajhi Position within the main Saudi Banks

    Al Rajhi Position within the main Saudi Banks (As at September‘17) SAR Bn Assets SAR Bn Loans ١ ١ ٢ ٢ ٣ ٤٤٥ ٣ ٤ ٢٥٧ ٥ ٥ ٤ ٣٣٨ ٢٣٣ ١٤٢ ٢٢٩ ٢١٨ ٢٠٢ ١٢١ ١٢٩ SAR Bn Current Accounts SAR Bn Retail Loans ١ ١ ٢ ٢ ٢٤٨ ٣ ٥ 164 ٣ ٤ ٤ ٢٣٢ 89 ٥ ١٠٠ ٧٤ ٨٣ 41 19 12 8

  9. Slide 9: Al Rajhi's Market Shares

    Al Rajhi’s Market Shares Current Personal Mortgages Assets* Deposit* Accounts* Loans* Loans* 15.3% 16.4% 23.9% 39.7% 24.6% 84.7% 60.3% 83.6% 76.1% 75.4% Auto Loans* Corporate Loans* Branches ATMs POSs 47.6% 52.4% 7.6% 75.1% 73.4% 73.8% 92.4% 24.9% 26.6% 26.2% AL Rajhi Competition * Q3 2017 9

  10. Slide 10: Recent International Recognition

    Recent International Recognition Global Awards Regional Awards Best Bank in Saudi Arabia - Best Bank in GCC - Fastest Growing Bank in KSA - Most Innovative Bank in KSA Best Financial Institution in Saudi Arabia Largest Bank in the world in terms of Sharia Assets - Strongest Islamic Retail Bank in th

  11. Slide 11: Our Values

    ‫ﻧﻌﻴﺶ ﻘﻴﻤﻨﺎ‬ Our Values Living the Values Integrity & Transparency Innovativeness Openness and highest standards of Nurturing imagination and fostering corporate & personal ethics creativity Passion to Serve Our Customers Meritocracy A strong commitment to anticipate and Defining, differentiating and

  12. Slide 12: Al Rajhi's Social Responsibility

    Al Rajhi’s Social Responsibility • 101 programs conducted 21 cities 5753 volunteering hours Participation clocked Vs. 1650 hours in 2016 CSR Strategic • People In Need, Volunteering, Focus Financial Literacy and Interna- tional Days • To enhance the staff participa- Direction tion in volunteering by

  13. Slide 13: Al Rajhi's Stock Performance

    Al Rajhi’s Stock Performance Al Rajhi is the largest constituent in MSCI GCC Index Stock Performance - Jan 31, 2018 Float Adj Country Mkt Cap Index Closing Price (SAR) 74.48 TOP 10 CONSTITUENTS (USD Billions) Wt. (%) Sector AL RAJHI BANKING & INV SA 24.21 9.44 Financials Book Value (SAR) 34.31 SAUDI

  14. Slide 14: Al Rajhi 2020 Strategy

    Al Rajhi 2020 Strategy A B C D E Become Accelerate Growth Employer of Choice Customer Focus Digital Leadership Execution Excellence Grow Mortgage, Engaged Update value Smartly World-class private sector, workforce propositions expand channels compliance affluent, ladies & & formats Key initiatives 20

  15. Slide 15: Sustainable Growth in Our Financial Position

    Sustainable Growth in Our Financial Position Assets Loans Deposits SAR Bn. SAR Bn. SAR Bn. 340 343 225 234 CAGR CAGR CAGR 5.1 % 316 6.3 % 210 4.3 % 273 273 258 308 206 256 280 187 232 267 172 221 2016 2017 2016 2017 2016 2017 2015 2015 2015 2012 2013 2014 2012 2013 2014 2012 2013 2014 Sustainable gr

  16. Slide 16: The Financial Performance

    The Financial Performance Income & Operating Costs Net Income SAR Mn. SAR Mn. 9,121 Income Cost 8,126 7,885 27.0% 29.3% 33.1% 33.9% 32.6% 32.9% 7,438 7,130 15,905 6,836 ١٣,٩٨3 ١٣,٨٤5 ١٣,٦٦7 ١٣,٧٤6 15,341 5,007 5,237 ٣,٧٧9 ٤,٠٥7 ٤,٥١9 ٤,٦٥8 2015 2016 2017 2013 2014 2012 201٣ 201٤ 201٥ 2016 2017 2012

  17. Slide 17: Key Non-Financial KPIs

    Key Non-Financial KPIs 2017 2016 Actual Actual Net Promoter Score (NPS) Top 2 Top 3 % Complains / Active Customers 1.7 3.2 First Time Resolution (FTR) 91% 88% Manual to Digital 51:49 56:44 % Online Transactions 20% 15% Digital Subscribers (in millions) 2.34 1.87 17

  18. Slide 18: Al Rajhi Bank has significantly improved its NPS score

    Al Rajhi Bank has significantly improved its NPS score NPS 14 21 34 55% 50% 60% 4% 21% 14% 41% 29% 26% 2015 2016 2017 Base 3,554 4,587 31,058 Detractors Passives Promoters 0 1 2 3 4 5 6 7 8 9 10 18

  19. Slide 19: Al Rajhi's Market Shares Trends

    Al Rajhi’s Market Shares Trends Current Personal Mortgages Assets Deposit Accounts Loans Loans 15.3% 15.3% 16.3% 16.4% 23.7% 23.9% 40.4% 39.7% 21.6% 24.6% 14.5% 15.5% 23.2% 40.6% 20.6% 2015 2016 Q3 '17 2015 2016 Q3 '17 2015 2016 Q3 '17 2015 2016 Q3 '17 2015 2016 Q3 '17 Auto Loans Corporate Loans Bra

  20. Slide 20: Operating Income & Net Income by Business Segments

    Operating Income & Net Income by Business Segments SAR Mn Al Rajhi’s Operating Income 315 453 15,905 119 15,341 820 Operating Retail Corporate Treasury Investment Service Operating Income & Brokerage Income 2016 2017 Al Rajhi’s Net Income SAR Mn 783 394 9,121 95 8,126 701 Net Retail Corporate Treasu

  21. Slide 21: Loans, Deposits, & Revenues Compositions

    Loans, Deposits, & Revenues Compositions Loans Deposits Revenues Treasury Treasury 8% Corporate 4% Loans SME Corporate Corporate 28% Loans 6% 15% 2% Investment Other 3% 2% Retail Retail Loans Retail 74% 70% 88% 75.4% 21

  22. Slide 22: High NPL Coverage & Low NPL Ratio

    High NPL Coverage & Low NPL Ratio 360% 2.1% 314% 2.0o% 1.9% 310% 1.7% 1.57% 1.51% 260% 1.5% 231% 1.24% 1.3% 210% 1.26% 196% 1.1% 177% 0.9% 160% 144% 0.74% 0.7% 137% 110% 0.5% 2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 NPL Coverage % NPL % • Continuous improvement in bank’s assets qu

  23. Slide 23: Outstanding Key Profitability Ratios

    Outstanding Key Profitability Ratios ROA% ROE% The highest in the market* The 2nd highest in the market* 2.72% 19.84% 2.67% 16.94% 2.48% 17.01% 16.49% 2.33% 2.29% 16.11% 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 Net Commission Margin % Cost of Funds% The highest in the market* The lowest in t

  24. Slide 24: Capital Strengths & Risk Management

    Capital Strengths & Risk Management CAR (Tier I + II)% Loans/Deposits% (LDR%) 85.5% The highest in the market* 82.5% 21.98% 23.29% 81.5% 20.83% 80.7% 19.60% 19.59% 80.4% 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 Liquidity Coverage Ratio % (LCR%) Cost of Risks% (COR%) 1.28% 233% 1.15% 210% 18

  25. Slide 25: Al Rajhi is rated by all major Rating Agencies

    Al Rajhi is rated by all major Rating Agencies 2013 2014 2015 2016 2017 Moody’s A1 A1 A1 A1 A1 S&P A+ A+ A BBB+ BBB+ Fitch A+ A+ A+ A A- KSA Sovereign Aa3 Aa3 Aa3 A1 A1 Moody's KSA Sovereign AA- AA- A+ A- A-u S&P • Al Rajhi Bank’s strong financial position and credit profile is endorsed by major Rat

  26. Slide 26: Balance Sheet Summary

    Balance Sheet Summary SAR - Millions FY 2017 FY 2016 Growth % Due From Banks & Other Financial Institutions 10,710 26,579 -59.7% Investments 36,401 34,033 7.0% Financing, net 233,536 224,994 3.8% Total Assets 343,117 339,712 1.0% Due to Banks & Other Financial Institutions 5,523 8,917 -38.1% Total C

  27. Slide 27: Statement of Income Summary

    Statement of Income Summary SAR - Millions Income Statement 12M 2017 12M 2016 Variance % Net Yield Income 12,029 11,223 7.2% Fees from Banking Services 2,697 2,950 -8.6% Exchange & Other Income 1,178 1,168 0.8% Total Operating Income 15,905 15,341 3.7% Total Operating Expenses 5,237 5,007 4.6% Incom

  28. Slide 28: FY 2018 Guidance

    FY 2018 Guidance Key Financial Items FY 2017 Actual FY 2018 Expected Financing (net) – YoY% Growth 3.8% 5% to 7% NIM% 4.16% +10 to +20Bps Cost/Income % 32.9% Below 32.0% Cost of Risk % 0.66% 0.70% to 0.90% 28

  29. Slide 29: Disclaimer

    Disclaimer • AL RAJHI BANK HEREIN REFERRED TO AS ARB MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY REGARDING THIS DOCUMENT OR THE MATERIALS AND INFORMATION CONTAINED OR REFERRED TO ON EACH PAGE ASSOCIATED WITH THIS DOCUMENT. THE MATERIAL AND INFOR- MATION CONTAINED O

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