Hong Leong Bank Bhd · MYX:HLBANK
Hong Leong Bank Bhd — Q3 FY2023 Earnings Presentation
21 slides from Hong Leong Bank Bhd's earnings presentation, 2023
Slide 1: Confidentiality notice
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Slide 2: HLB 9MFY23 ended 31 March 2023
1 HLB 9MFY23 ended 31 March 2023 2
Slide 3: Key Financial Highlights
Key Financial Highlights Resilient performance supported by sustained loan/financing growth momentum Total Income Opex & CIR Operating Profit • Healthy topline growth underpinned by • Tightly managed cost, delivering a • Healthy profitability amid a challenging expansion in loan/financing base and r
Slide 4: Management Guidance
Management Guidance Management guidance remains on track Target FY2023 7%- ~10 ~2.14% ≤38% ~0.60% >12.0% >30% 7.5% bps Gross Net Cost-to- Gross Net Credit Return on Loan Interest Income Impaired CASA Mix Cost Equity Growth Margin Ratio Loan Ratio ~7% ~2.00% Achieved 9MFY23 P P P P P P 7.2% 2.03% 3
Slide 5: Profit & Loss
Profit & Loss Solid performance driven by non-interest income growth and robust associates contribution Profit After Tax 229 135 RM’mil 4 279 32 2,954 108 2,382 PAT 9MFY22 Net Interest Non Interest Opex Loan & Other Associates Tax PAT 9MFY23 Income Income Impairment Contribution Allowances RM’mil 9M
Slide 6: Net Interest Income & NIM
Net Interest Income & NIM Prudent asset/liability management amid intense deposit competition and SRR compliance Seeing some stabilisation in the cost of deposits since late February and the most recent OPR increase will help to stabilise NIM% 2.15% 2.10% 2.18% 2.09% 2.16% 2.03% 13 bps 1.82% y-o-y 3
Slide 7: Non-Interest Income
Non-Interest Income Healthy contribution from higher card fees, trade finance activities, trading and FX income 21.0% 919 15.6% 77 RM’mil 640 Credit Card 9MFY22 9MFY23 390 10.1% 46 RM143 mil RM158 mil Related Fees 138 Wealth Fee income: 9MFY22 9MFY23 455 452 of which Management RM150 mil RM130 mil 1
Slide 8: Operating Expense
Operating Expense Prudently managed spending with CIR maintained at 37.6% Operating Expenses Domestic Admin & 35.5% 35.3% CIR general 13% Personnel cost 53% Marketing 9% 37.5% 37.6% 9MFY23 1,646 RM’mil 1,538 222 174 117 151 Establishment 390 404 25% Opex remains stable q-o-q 857 868 518 560 541 546
Slide 9: Loans/Financing
Loans/Financing Growth trajectory maintained, led by expansion in key loan/financing portfolio 7,944 1,383 2,311 (+3.2%) (+22.0%) 7.2% (+7.3%) RM’mil 174,228 y-o-y 162,494 Total Loans 9MFY22 Retail Business & Corporate International Operations Total Loans 9MFY23 Domestic Residential 9MFY22 9MFY23 9M
Slide 10: Asset Quality
Asset Quality Solid asset quality coupled with sufficient loan impairment coverage Gross Impaired Loans/Financing (GIL) Loan/Financing Impairment Coverage (LIC) 1.80% 1.74% 1.62% 317% 1.54% 1.43% 282% 267% 247% 0.78% 0.61% 212% 212% 0.46% 0.49% 0.52% 197% 188% RM'mil 142% 118% 113% 1,071 99% 98% 96%
Slide 11: Asset Quality
Asset Quality Healthy indicators with no major stress any particular portfolio Malaysia Overseas 0.51% 0.54% 0.48% 0.22% 0.12% 0.12% 806 876 707 28 11 14 FY21 FY22 9MFY23 FY21 FY22 9MFY23 Group Residential Properties Transport Vehicles SME 0.43% 0.35% 0.38% 0.33% 1.25% 0.20% 0.22% 1.10% 1.11% 376 34
Slide 12: Deposit
Deposit Growth supported by solid expansion in business deposits CASA Fixed Deposits 6.6% 9MFY22 9MFY23 4.1% 9MFY22 9MFY23 20.6% RM63.0 bil RM60.4 bil RM92.3 bil RM111.2 bil y-o-y RM'mil 197,292 202,956 CASA Ratio 29.8% 190,426 183,290 173,493 Individuals Business Enterprises 9MFY22 9MFY23 9MFY22 9M
Slide 13: Liquidity & Capital
Liquidity & Capital Healthy liquidity and capital positions Loan-to-Deposit Ratio (LDR) Capital Adequacy^ 16.7% 88.6% 87.6% 87.0% 86.4% 86.1% 16.1% 16.1% 16.0% 15.4% 14.5% 14.0% 14.0% 13.9% 13.3% 84.4% 83.5% 83.9% 83.5% 84.0% 13.4% 12.7% 12.9% 13.0% 12.9% FY2019 FY2020 FY2021 FY2022 9MFY23 Industry
Slide 14: Shareholder Value
Shareholder Value Sustainable returns on solid fundamentals Return on Equity & Return on Assets Net Assets & Earnings Per Share 161 140 144 116 12.3% 10.9% 10.6% 10.1% 16.1 15.1 14.8 14.4 1.50% 1.34% 1.30% 1.25% FY2021 FY2022 9MFY22 9MFY23 FY2021 FY2022 9MFY22 9MFY23 ROE ROA NAV/share (RM) EPS (sen)
Slide 15: Performance of Associated Company: Bank of Chengdu Co., Ltd.
Performance of Associated Company: Bank of Chengdu Co., Ltd. Financial Highlights for Q1 ended 31 March 2023 (unaudited) Robust ROE 17.8% Operating Income Profit After Tax RMB'mil 5,305 4,836 10% RMB'mil 2,527 2,151 18% Solid Cost-to-income Ratio 23.3% Q1FY22 Q1FY23 Q1FY22 Q1FY23 Gross Loan GIL rati
Slide 16: HLB 9MFY23 ended 31 March 2023
2 HLB 9MFY23 ended 31 March 2023 16
Slide 17: Closing Remarks
Closing Remarks Resilient performance amid ongoing macroeconomic headwinds, backed by sustained loan/financing growth momentum, solid asset quality and robust contribution from our associates ▪ Sustained topline performance supported by loan/financing growth momentum and higher non-interest income;
Slide 18: HLB 9MFY23 ended 31 March 2023
3 HLB 9MFY23 ended 31 March 2023 18
Slide 19: Group Performance
Group Performance Change Change Change RM’mil 9MFY22 9MFY23 Q3FY23 (YoY) (YoY) (QoQ) Net interest income 3,459 3,463 0.1% 1,033 -11.1% -13.8% Non-interest income 640 919 43.7% 363 95.8% 26.1% Total income 4,099 4,382 6.9% 1,396 3.6% -6.1% Operating expenses (1,538) (1,646) 7.0% -559 7.9% 2.4% Operat
Slide 20: HLISB - Key financial highlights
HLISB - Key financial highlights Total Net Income Opex & CIR Profit after Tax and Zakat • Improved performance driven by robust • Tightly managed opex with commendable CIR • Consequently, profitability remained healthy financing expansion and lower financing supported by solid business fundamentals
Slide 21: Thank You / Disclaimer
Disclaimer This presentation has been prepared by Hong Leong Bank (“HLB”) for selected recipients for information purposes only and the information contained herein has been obtained from sources believed to be reliable. The information contained herein is believed to be correct as of the date of th
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