National Development Bank Plc · CSELK:NDB.N0000
National Development Bank — H1 2014 Earnings Presentation
24 slides from National Development Bank's earnings presentation, 2014
Slide 1: National Development Bank PLC Investor Update 1st Half 2014
National Development Bank PLC Investor Update 1st Half 2014
Slide 2: Disclaimer
Disclaimer This document has been prepared by National Development Bank (“NDB or the “Bank”) solely for use at its presentation to potential & current investors. By accepting this document, you agree to maintain absolute confidentiality regarding the information disclosed in this document The inform
Slide 3: Contents
Contents 1 Business Model and Strategy 2 1st Half Performance 3 Financial Position 4 Awards and Accolades © National Development Bank PLC Finance and Planning Division
Slide 4: Business Model and Strategy
1 Business Model and Strategy © National Development Bank PLC Finance and Planning Division
Slide 5: Business Model and Strategy
Business Model and Strategy Full –Fledged Financial Conglomerate Profitable Balance Sheet Growth Subsidiaries Operational Excellence Retail Banking Strong Sales Culture SME Higher Fee Income — Established by an Act of Parliament in 1979 and started commercial Banking operations after acquisition of
Slide 6: Integrated Services
Integrated Services An Opportunity to Cross Sell Wide Array of Products Infrastructure and Corporate Banking SME and Retail Treasury and ALM Bancaassuarance Capital Markets Project Finance Value Creation through Integrated Services To build up Asset book Universal banking Strengthening of Promoting
Slide 7: Network
Network Growing Distribution Network Province Branches Bank Partners Northern 4 Branch 79 Singer – Network 376; North Western 7 Northern RDB – 250 Province North Central 2 4 ATM Network 77 VISA Eastern 4 Internet Corporate - Northern Central Province Central 7 Banking & Retail 2 Western 39 Feet on S
Slide 8: 1st Half Performance
2 1st Half Performance © National Development Bank PLC Finance and Planning Division
Slide 9: 1st Half results - 2014: A Snapshot
1st Half results - 2014 A Snapshot Fitch Rating - AA- (Stable Outlook) Financial Highlights Key Financial Ratios YoY LKR Mn % YoY growth growth Operating Income 6.299 17% Return on Equity 16.24% 5.52% Profit for Shareholders 2,058 57% Return On Assets 1.82% 0.37% Earnings Per Share (LKR) 25.38 56% C
Slide 10: Superior Financial Performance - Group
1st Half results - 2014 Superior Financial Performance - Group YTD YTD LKR Mn YOY Growth 2013 2014 Net Interest Income 3,354 3,896 16% Other Income 2,023 2.402 19% Credit Loss Provision 122 220 80% Net Operating Income 5,254 6,079 16% Overheads 2,611 2,783 7% Profit Before Tax 2,643 3,296 25% Share
Slide 11: Operating Income Growth
Operating Income Growth Strategy Driven, Resilient Performance amidst slow industry performance Total Operating Income - QoQ/HoH LKR Bn 17% 3.1 6.3 2.9 5.4 2.3 4.6 2Q 12 2Q 13 2Q 14 1H 12 1H 13 1H 14 2014 recorded the highest Banking revenue in comparison to the corresponding quarters in 2012 and 20
Slide 12: Income Analysis
Income Analysis Further Analysis in to Operating Income Net Interest Income is challenged by low margins NII Performance LKR Mn NII Bank NIM Industry NIM Bank Banking industry interest margins came down to 3.2% from 4.2% as a result of the higher liquidity and the policy measures taken. 4.2% 4.1% 3.
Slide 13: Operating efficiency
Operating efficiency Focus on Cost Optimization Cost Optimization Initiatives in place Cost Vs Income (LKR Mn) 11,549 Income 9,187 Rationalization of Procurement process Cost Efficient allocation of resources with right people at the right time 6,299 Tracking and monitoring mechanism to ensure the i
Slide 14: Profitability
Profitability Consistently improving Profitability Profitability trend (LKR Bn) 6.0 25.0% 2014 1H ROE indicates the highest since 2010. PBT PAS ROE Sustainable Revenue and efficient operations boosted 5.0 profits during 2014. 5.1 4.8 20.0% 4.0 4.4 4.4 16.2% This exemplary results were achieved amids
Slide 15: Financial Position
3 Financial Position © National Development Bank PLC Finance and Planning Division
Slide 16: Balance Sheet composition
Balance Sheet composition Premeditated diversification of Uses and Sources of Funds Key Attributes 58% 66% Total assets mainly comprises of Loans to Customers and Investments in government securities which accounts Loans for 66% and 28% respectively. Deposits Investments Borrowings Customer Deposits
Slide 17: Loans and Advances
Loans and Advances A Well Diversified Portfolio Loans and Advances grew with Growth Contribution by segments during First Half 12% YTD FCY LCY 43% Project Financing CAGR 27% 38 39% 34 Retail and SME 28 120 18% 107 Corporate 23 91 19 73 14 Supports the development of Small and Medium Entrepreneurs 49
Slide 18: Asset quality
Asset quality Robust Risk Management Process Risk management practices NPL – NDB Vs Industry • Structured and Standardized credit approval Process 6.2% 5.4% 5.6% • Delegation of Authority 3.8% 3.7% • Internal Risk Ratings 2.5% 2.7% • A post sanction review and monitoring mechanism 1.9% 1.4% 1.3% • P
Slide 19: Funding
Funding Funding growth via Deposit Mobilization Deposit growth over Last 5 years (LKR Bn) Key Highlights FCY LCY 8% 30 21% of the total deposits are held in Foreign Currency YTD 30 27% 110 Low cost CASA base improved to 25.3% from 21.5% YoY 28 6 100 5 80 YTD Deposit growth is 8% impressive while the
Slide 20: Capital Adequacy
Capital Adequacy Well Capitalized Balance Sheet Capital Adequacy Trend 25.0% 20.7% 21.0% 20.3% 18.8% 19.1% 20.0% 17.8% 15.8% 15.2% 14.2% 13.8% 15.0% 10.0% 5.0% 0.0% 201 0 201 1 201 2 201 3 201 4 H1 Risk Weighted Assets Tier 1 Tier 1 & 2 200 180 15 160 15 17 140 12 12 120 2 10 100 3 80 10 154 3 137 6
Slide 21: Ahead of Competition
Ahead of Competition Gaining the Market Share Market share grew on YoY June 2013 June 2014 Total Assets 3.3% 3.8% Loans 3.8% 4.6% Deposits 3.0% 3.2% Better Financial Indicators over the industry Standards Key Performance Indicators Disciplined Execution of Strategy NDB Industry Key Financial Indicat
Slide 22: Awards and Accolades
5 Awards and Accolades © National Development Bank PLC Finance and Planning Division
Slide 23: Awards and Accolades
Awards and Accolades Gaining Global Recognition Domestic Retail Bank of the Year - Sri Lanka SME Bank of the Year - Sri Lanka Core Banking system initiative of the year - Sri Lanka Bronze award for Investor relations - CFA Sri Lanka Winner - Excellence in Core Banking Technology NDBIB was adjudged a
Slide 24: Thank You!
THANK YOU ! Visit our Web site : www.ndbbank.com Investor & Community Relations
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