Suncorp Group Limited · ASX:SUN
Suncorp — Corporate Update (November 2008)
14 slides from Suncorp's corporate update, Nov 24, 2008
Slide 1: Banking Market Update including APS 330 disclosures
For personal use only Suncorp-Metway Ltd Banking Market Update including APS 330 disclosures 24 November 2008
Slide 2: Responding to a challenging environment
Responding to a challenging environment External Environment Response For personal use only Term credit markets progressively 1. Adjust pricing to reflect increased funding costs and risk close and funding costs increase • Progressive repricing of business customer’s margins reflecting broader marke
Slide 3: Lending growth moderating in line with macro trends
Lending growth moderating in line with macro trends Assets, $m For personal use only Retail lending Business lending growth growth 30,000 2.1% 1.0% 2.4% 25,000 Growth due to 20,000 continued drawdowns on existing facilities 15,000 10,000 4.5% 0.4% 1.0% 5,000 1.0% (1.3%) (2.7%) (6.1%) 0 Housing Loans
Slide 4: Updated 2008/09 bank guidance
Updated 2008/09 bank guidance Revenue Expenses For personal use only • Higher average balance • Tight cost constraint sheet vs pcp • Align resourcing to volumes • Repricing business assets • Business process • Favourable cash to bills outsourcing spread • Bank integration Gross loans, advances and o
Slide 5: Portfolio overview
Portfolio overview Summary Well diversified by industry… For personal use only Financial • Well diversified Hospitality services Other 4% 3% commercial Other and industrial 5% • Geographic bias to QLD 7% Agribusiness • 60% of lending supports 7% Residential mortgage lending 45% residential exposures
Slide 6: Portfolio credit review
Portfolio credit review • Comprehensive review of the loan portfolio commenced in April 2008 For personal use only • High calibre team appointed with experience in relevant sectors • Focused on asset risk, servicing risk and likelihood of future repayments • Processes and lending practices were also
Slide 7: Conservative treatment of impaired assets
Conservative treatment of impaired assets Raptis • No exposure to Southport Central developments For personal use only • Subsidiary of MFS Sun Leisure • Security held is retail buildings • Provision raised due to expected valuation reductions SEQ property developer • Private company Gross impaired a
Slide 8: Provisions and write-offs
Provisions and write-offs Sept 08 Total Provisions (including GRCL)/Risk For personal use only Weighted assets 1.40% 1.3% Collective provision 32 1.20% 1.1% 1.00% 0.9% Specific provision 31 0.84% 0.8% 0.8% 0.80% 0.7% Actual write-offs 11 0.60% 0.40% Bad debt charge 73 0.20% 0.00% Suncorp Major 1 Maj
Slide 9: Funding update – a new environment
Funding update – a new environment For personal use only Australian Enables Suncorp and other banks to compete for offshore Government funding with other government guaranteed issuers and to Guarantee improve access to the term domestic market Deposit Guarantee Provides confidence in all deposit tak
Slide 10: Strengthened capital position
Strengthened capital position For personal use only 30 Jun 2008 30 Sep 2008 Target Bank Capital Adequacy Ratio 10.44% 11.36% 10.0%-10.5% Tier 1 Capital 8.04% 8.99% 9.5 12.00% 9 11.34% 11.36% 10.84% 11.00% 10.44% 8.5 9.86% 10.00% 8 8.99% 9.00% 8.70% 8.05% 8.04% 7.5 7.69% 8.00% 7 7.00% 6.5 6.00% Sunco
Slide 11: Storm update
For personal use only Storm update Event Month Cost ($m) New Zealand storm July 15* Ipswich hail storm September 30 Gold Coast/Byron storm October 6 South East Queensland storm November 150+ 13,000+ claims * AUD 11
Slide 12: Upgraded bank guidance for 2008/09
For personal use only Upgraded bank guidance for 2008/09 Banking Previous forecast Upgraded forecast Lending growth* 8-10% 5% Expense growth n/a flat PBT before bad debts ‘high single digits’ ‘high teens’ Bad debt expense n/a 35 – 40 bps of gross loans, advances and other receivables *Gross loans, a
Slide 13: For personal use only
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Slide 14: Disclaimer
Disclaimer For personal use only This report contains general information which is current as at 24 November 2008. It is not a recommendation or advice in relation to Suncorp-Metway Limited or any product or service offered by the Suncorp Group. This report should be read in conjunction with all oth