Rizal Commercial Banking Corporation · PSE:RCB
Rizal Commercial Banking — 1H 2020 Earnings Presentation
34 slides from Rizal Commercial Banking's earnings presentation, 2020
Slide 1: Investor Presentation 1H 2020
Investor Presentation 1H 2020
Slide 2: Disclaimer
DISCLAIMER ANY INVESTMENT DECISION TO PURCHASE SECURITIES IN THE CONTEXT OF A PROPOSED OFFERING, IF ANY, SHOULD BE MADE ON THE BASIS OF THE FINAL TERMS AND CONDITIONS OF THE SECURITIES AND THE INFORMATION CONTAINED IN THE OFFERING CIRCULAR PUBLISHED IN RELATION TO SUCH AN OFFERING AND NOT ON THE BAS
Slide 3: Table of Contents
Table of Contents 1 Introducing RCBC 2 Economic Overview 3 Financial Overview 4 Strategic Initiatives 5 Recognition 6 Appendix - Financial Information 3
Slide 4: 1. Introducing RCBC
Investor Presentation 1H 2020 1. Introducing RCBC 4
Slide 5: RCBC is a leading financial services provider in the Philippines
RCBC is a leading financial services provider in the Philippines Incorporated in 1960, RCBC is the 8th largest private domestic bank in the Philippines by assets, with a market capitalization of Php32.82bn (USD0.66bn)1 and share price of Php16.962 . Member of the Yuchengco Group of Companies (YGC).
Slide 6: Investment Information
Investment Information Dividends Particulars 2Q 2020 Year Pay-out ratio per share Long Term Baa2 Ticker RCB 2020 0.56 20.00% Deposit Long Term Issued shares 1,935.63mn 2019 0.45 17.02% IDR - Stock Price 16.96 2018 0.62 20.02% Senior Baa2 Php 32.82bn Unsecured Market Cap 0.55 16.53% ( USD0.66bn ) 201
Slide 7: Yuchengco Group of Companies
Yuchengco Group of Companies • RCBC is a member of the Yuchengco Group of Companies (YGC), one of the premier business conglomerates in the Philippines. • The group is engaged in a wide range of financial and non-financial services. The synergies among these companies allow customers to access a wid
Slide 8: Ownership Structure
Ownership Structure Cathay Life Insurance 23.35% Pan Malayan Management and Investment Corp. (PMMIC) & Affiliates of the Yuchengco Group of Companies (YGC) International Finance Corporation 52.74% 5.57% Public Float 18.33% Note: The 23.90% public ownership, as disclosed in the Public Ownership Repor
Slide 9: Comprehensive and Diversified Business Platform
Comprehensive and Diversified Business Platform RCBC Forex Brokers RCBC Capital Rizal Micro Bank RCBC Leasing RCBC Intl Finance Corporation Corporation Microfinance Thrift Leasing Hong Kong Financing Foreign Exchange Investment Bank Bank Company Company Broker RCBC Securities RCBC Bankard RCBC Renta
Slide 10: Key Milestones
Key Milestones 1960-1970s 1980-1990s 2000s 2010s September 1960 1985 2000 2011 RCBC was Continental Illinois Bank Expanded its credit card Formed alliances with IFC and CVC Capital Partners incorporated and sold its shareholding to UFJ business with the purchase Formed Bancassurance partne
Slide 11: RCBC has a broad, nationwide branch network
RCBC has a broad, nationwide branch network Branch distribution by Region December 2019 CAR I: Ilocos 3 16 8 II: Cagayan Valley Region III: Central 41 IV-A: Calabarzon Luzon NCR: Metro Manila 200 84 7 V: Bicol Region IV-B: Mimaropa VIII: VI: 6 Eastern Western Visayas 6 Visayas 26 30 VII: Central Vis
Slide 12: 2. Economic Overview
Investor Presentation 1H 2020 2. Economic Overview 12
Slide 13: The Philippines enters a recession
The Philippines enters a recession 2Q 2020 GDP contracted by -16.5%, biggest decline since records started in the early 1980s FORECAST Philippine GDP growth rate • Philippine growth constrained in view of the stringent quarantine measures to contain the COVID-19 outbreak. -5% to -7% From usual +6 to
Slide 14: 3. Financial Overview
Investor Presentation 1H 2020 3. Financial Overview 14
Slide 15: RCBC Net Income Up by 17%, increases provisions to Php5 Bn
RCBC Net Income Up by 17%, increases provisions to Php5 Bn Amounts in PHP Millions 1H20 1H19 Change % Change SELECT INCOME STATEMENT DATA Net Interest Income 12,794 10,624 2,170 20.4% Non-Interest Income 8,063 6,129 1,935 31.6% Operating Expenses 11,011 10,507 503 4.8% Provision for Probable Losses
Slide 16: Historical Financial Performance
Historical Financial Performance Amounts in PHP Billions OPERATING EFFICIENCY PROFITABILITY 30 76.1% 70.9% 73.2% 60.7% 100% 52.8% 80% 7 7.4% 8% 60% 6.4% 6.7% 6.5% 40% 20 5.8% 20% 6% 0% 6 -20% 10 19.4 21.8 17.4 17.8 -40% 4% 11.0 -60% -80% 5 0 -100% 2% 2016 2017 2018 2019 1H20 4 Operating Expenses Cos
Slide 17: Consolidated Income Statement
Consolidated Income Statement Amounts in PHP Millions 1H20 1H19 Change % Change Interest Income 19,055 18,731 324 1.7% Interest Expense 6,261 8,107 (1,846) -22.8% Net Interest Income 12,794 10,624 2,170 20.4% Other Income 8,063 6,129 1,935 31.6% Trading Gains and Forex 5,904 3,274 2,630 80.3% Trust
Slide 18: Income growth driven by trading gains and loan book expansion
Income growth driven by trading gains and loan book expansion Amounts in PHP Millions Diversified and high quality 1H20 customer loan portfolio GROSS INCOME 0% Consumer 1H19 13% 30% 0% Corporate 446B 53% 31% 11% 8,063 393B 54% SME 32% 17% 15% 6,129 23% Trading and forex gains 12,794 10,624 20% 81% 5
Slide 19: Consolidated Balance Sheet
Consolidated Balance Sheet Amounts in PHP Millions 1H20 1H19 Change % Change Cash/Due from BSP & Other Banks 149,986 89,912 60,074 66.8% Investment Securities 52,348 144,105 (91,757) -63.7% Loans (net of Interbank) 441,470 385,052 56,418 14.7% Other Assets 74,948 54,767 20,181 36.8% TOTAL ASSETS 718
Slide 20: Consolidated Key Financial Indicators
Consolidated Key Financial Indicators Amounts in PHP Millions 1H20 1H19 Change PROFITABILITY Annualized ROE 7.4% 6.5% 0.9% Annualized ROA 0.9% 0.8% 0.0% Net Interest Margin 4.3% 3.8% 0.5% COST EFFICIENCY Cost-to-Income Ratio 52.8% 62.7% -9.9% ASSET QUALITY Net NPL Ratio 2.2% 2.1% 0.2% NPL Coverage R
Slide 21: 4. Strategic Initiatives
Investor Presentation 1H 2020 4. Strategic Initiatives 21
Slide 22: High proportion of low-cost deposits, to be boosted by cash management initiatives
High proportion of low-cost deposits, to be boosted by cash management initiatives • The Bank has a diversified depositor base, from 499 457 both the retail and corporate segments. 423 388 353 • Moving forward, the bank will continue to focus on 233 207 building its customer base by improving our sa
Slide 23: Well-diversified loan portfolio, driven by the consumer segment
Well-diversified loan portfolio, driven by the consumer segment Total Customer Loans In Php Billion 446 434 • The Bank will continue to forge strategic partnerships 389 1 1 with major car dealerships and real estate developers 353 1 30 30 to support consumer loan growth 306 1 22 106 16 101 1 90 • RC
Slide 24: Diverse and Stable fee-based revenue
Diverse and Stable fee-based revenue Fee Income In Php Million Fee Income Growth Strategy 3,759 4,178 3,490 3,417 3,601 Retail Banking: Build a large mass affluent client 1,748 base, including prepaid (MyWallet) and payroll customers, and increase no. of transactions such as payment (i.e. bills) and
Slide 25: RCBC is commencing its Digital Transformation
RCBC is commencing its Digital Transformation Transformation centered on creating delightful customer experiences Dedicated and world-class Data Science Provides clients with digital cash Continuous enhancements and team, enabling RCBC to leverage on management solutions for their various improvemen
Slide 26: RCBC Digital channels see record growth in transactions
RCBC Digital channels see record growth in transactions Mobile and Diskartech Internet Banking 187% 1 Million Digital banking enrollments Users just 38 days after launch 569% #1 Free finance app in the Send Cash transaction count Google Playstore PH1 RCBC ATM Go Cardless ATM Withdrawal Php 2.82B 134
Slide 27: The Bank is a leader in Green and Sustainable Finance
The Bank is a leader in Green and Sustainable Finance • RCBC is the first Philippine universal bank to issue ESG rating green and sustainable financing instruments under A global standards RCBC Sustainable Loan Portfolio RCBC Sustainability Bond 30 June 2020 Php8B ($160M) Socioeconomic Sustainable A
Slide 28: 5. Recognition
Investor Presentation 1H 2020 5. Recognition 28
Slide 29: Recognized by multiple award-giving bodies
Recognized by multiple award-giving bodies Best Commercial Bank in the Best SME Bank - 2018 Best Card Offering-Philippines - Syndicated Loan of the Philippines - 2017 Best for Credit Derivatives - 2016 2018 Year – RCBC Capital Best Practices award- Best Banking Group in the Best Market Coverage –201
Slide 30: 6. Appendix
Investor Presentation 1H 2020 6. Appendix
Slide 31: Consolidated Income Statement
Consolidated Income Statement Amounts in PHP Billions 2016 2017 2018 2019 1H20 Net Interest Income 15.71 18.02 20.49 22.37 12.79 Total Non Interest Income 7.11 7.10 6.01 13.49 8.06 Gross Income 22.82 25.12 26.50 35.86 20.86 Provision for Loan Losses 1.77 2.16 1.90 7.40 5.20 Income before Operating E
Slide 32: Consolidated Balance Sheet
Consolidated Balance Sheet Amounts in PHP Billions 2016 2017 2018 2019 1H20 Cash/Due from BSP/Due from Other Banks 107 93 94 123 150 Loans Arising From REPO 8 10 10 6 9 FVPL/FVTCI 24 13 30 60 41 Held to Maturity Investments 52 60 89 101 11 Interbank Loans and Receivables 1 0 10 19 39 Loans (net of I
Slide 33: Key Financial Ratios
Key Financial Ratios 2016 2017 2018 2019 1H20 Return on Average Capital Funds 6.4% 6.7% 5.8% 6.5% 7.4% Return on Average Assets 0.8% 0.8% 0.7% 0.8% 0.9% Net Interest Margin 4.1% 4.3% 4.0% 4.0% 4.3% Cost-to-Income Ratio 76.1% 70.9% 73.2% 60.7% 52.8% CASA to Total Deposits 58.1% 55.9% 54.4% 54.7% 53.3
Slide 34: Thank you.
RCBC Thank you.
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