Dah Sing Financial Holdings Limited · HKEX:440
Dah Sing Financial — H1 2016 Earnings Presentation
23 slides from Dah Sing Financial's earnings presentation, 2016
Slide 1: Dah Sing Group 2016 Interim Results
Dah Sing Group 2016 Interim Results Dah Sing Group
Slide 2: Performance highlights
Performance highlights Growth in net interest income led by better NIM and higher average interest earning asset balances Weaker y-o-y performance in non-interest income due mainly to difficult market conditions in 1H 2016, in contrast with an exceptionally strong market in 1H 2015 Higher cred
Slide 3: Financial Highlights
Financial Highlights Dah Sing Group
Slide 4: Dah Sing Banking Group (2356)
Dah Sing Banking Group (2356) HK$’ million 1H16 1H15 Change Net interest income 1,769 1,594 +11% Net fee and commission income 399 522 -24% Net trading income and other income 97 210 -54% Total operating income 2,265 2,325 -3% Operating expenses (1,117) (1,088) +3% Operating profit before impairment
Slide 5: Dah Sing Financial Holdings (0440)
Dah Sing Financial Holdings (0440) HK$’ million 1H16 1H15 Change Net interest income 1,947 1,743 +12% Net fee and commission income 352 482 -27% Net trading income and other income 633 148 +328% Net insurance premium and change in value of inforce 1,189 900 +32% Total operating income 4,121 3,273 +2
Slide 6: Dah Sing Banking Group
Dah Sing Banking Group Dah Sing Group
Slide 7: Key return indicators
Key return indicators 14% 12.4% 12% 10% 9.7% 8% 6% 4% 2% 1.4% 1.1% 0% 1H15 1H16 Return on average total assets (annualized) Return on average shareholders' funds (annualized) Dah Sing Group 7
Slide 8: Capital adequacy and loan to deposit ratio
Capital adequacy and loan to deposit ratio Capital adequacy ratio Loan to deposit ratio (excl. trade bills but incl. CDs) 16.7% 16.7% 16.2% 15% 4.3% 4.5% 4.5% 70% 10% 72.6% 70.9% 60% 69.8% 11.7% 12.2% 12.4% 5% 0% 50% 30 Jun 15 31 Dec 15 30 Jun 16 30 Jun 15 31 Dec 15 30 Jun 16 CET1/Tier 1 Tier 2 Dah
Slide 9: Gross advances to customers and trade bills
Gross advances to customers and trade bills 130,000 Loans for use outside 120,000 115.1 bn 116.1 bn 117.4 bn HK 110,000 25% 100,000 25% 25% Trade finance and trade bills 90,000 80,000 11% 12% 12% HK$ million 70,000 Credit card advances 11% 12% 12% and other loans to 60,000 individuals 50,000 17% 16%
Slide 10: Improving net interest margin
Improving net interest margin 2.00% 1.94% 1.90% 1.90% 1.83% 1.80% 1.76% 1.70% 1.60% 1.50% 1.40% 1.30% 2015 average 1H15 2H15 1H16 Dah Sing Group 10
Slide 11: Income from core businesses
Income from core businesses 2,600 2,400 2,325 2,265 2,262 2,200 210 9% 131 6% 97 4% Net trading income and 2,000 other operating 388 17% 399 18% 1,800 522 22% income 1,600 HK$ million 1,400 Net fee and 1,200 commission income 1,000 1,594 69% 1,743 77% 1,769 78% 800 600 Net interest 400 income 200 0
Slide 12: Credit quality
Credit quality 30 Jun 15 31 Dec 15 30 Jun 16 0.0% Overdue and rescheduled 0.5% assets ratio 0.51% 0.64% 0.75% 0.86% 1.0% Impaired loan 1.03% ratio 1.20% 1.5% Dah Sing Group 12
Slide 13: Commercial banking
Commercial banking Higher net interest income and improved NIM Better deposit franchise and funding mix Growth in commercial loans compensated for a reduction in the cross-border trade bills business resulting in flat loan book Lower non-interest income due to unfavorable market conditions
Slide 14: Personal banking
Personal banking Higher net interest income with modest growth in residential mortgages and unsecured personal loans Lower average funding cost with effective deposit cost management Improved bancassurance business performance, but overall fee and commission income was much softer than in 1H15
Slide 15: Treasury
Treasury Moderate segmental profit growth of 3% Net interest income growth by about 30% Conservative liquidity management; average Liquidity Maintenance Ratio of around 40% was well above statutory requirement Prudent treasury portfolio with high average credit rating and relatively short du
Slide 16: Overseas banking
Overseas banking Macau: Improving net interest income but soft non-interest income Slow loan growth due to softening domestic loan demand Consistently benign credit quality PRC: Tighter credit risk control leading to better credit performance in our Mainland business despite uncertain market
Slide 17: Dah Sing Financial Holdings
Dah Sing Financial Holdings Dah Sing Group
Slide 18: New exclusive bancassurance partnership
New exclusive bancassurance partnership Dah Sing Financial ~75% Holdings Limited (Stock code: 0440) Entities subject to 100% the Disposal Dah Sing Banking Group Limited (Stock code: 2356) Hong Kong Distribution DSLA Agreement DSB MLIC DSIS Macau Distribution Agreement BCM Dah Sing Group 18
Slide 19: Insurance Group – financial highlights
Insurance Group – financial highlights HK$’ million 1H16 1H15 Change Net premium income 941 932 +1% Investment income 734 103 +613% Increase in value of in-force 253 (27) --- Other income 14 10 +40% Total income 1,942 1,018 +91% Claims (427) (460) -7% Commission and other expenses (232) (234) -1% Tr
Slide 20: Investment portfolio and net worth of insurance group
Investment portfolio and net worth of insurance group 16 15.10 13.41 13.83 14 12 Size of 10 investment HK$ billion portfolio 8 6 4.23 4.41 4.54 Net worth (including VoIF) 4 2 0 30 Jun 15 31 Dec 15 30 Jun 16 Dah Sing Group 20
Slide 21: Key return indicators
Key return indicators 12% 11.1% 10% 8.7% 8% 6% 4% 2% 1.1% 0.8% 0% 1H15 1H16 Return on average total assets (annualized) Return on average shareholders' funds (annualized) Dah Sing Group 21
Slide 22: Conclusions
Conclusions Dah Sing Group
Slide 23: Conclusions
Conclusions Pre-provision earnings down modestly, mainly due to weaker fee income with much softer market conditions in contrast with the exceptionally strong market in 1H 2015 Lower profit attributable to shareholders overall, with higher but manageable credit cost Overall performance broadly
Dah Sing Financial Holdings — H1 2016 Earnings Presentation on 6ix