Ncba Group Plc · NSEKE:NCBA
Ncba — Q1 2025 Earnings Presentation
45 slides from Ncba's earnings presentation, May 2025
Slide 1: Q1 2025 Investor Pack
PG Q1 2025 Investor Pack May 2025
Slide 2: Contents
PG 2 CONTENTS WHO WE ARE < OPERATING ENVIRONMENT < UPDATE ON STRATEGY < FINANCIAL PERFORMANCE Q1 2025<
Slide 3: Q1 2025 Key Messages
PG 3 Q1 2025 KEY MESSAGES 1 2 3 Solid fundamentals across Well controlled risks We have delivered on our our business long term strategic ambitions Delivered a resilient ROAE of 19.4% & We are delivering a better-quality Expanded our retail banking footprint, maintained strong capitalization l
Slide 4: Contents
PG 4 CONTENTS WHO WE ARE < OPERATING ENVIRONMENT < UPDATE ON STRATEGY < FINANCIAL PERFORMANCE Q1 2025<
Slide 5: Our Group Structure
PG 5 WHO WE ARE Our Group Structure : We have expanded beyond our banking roots to providing non- banking services to our customers NCBA GROUP PLC BANKING SUBSIDIARIES NON-BANKING SUBSIDIARIES NCBA NCBA NCBA NCBA NCBA NCBA NCBA BANK BANK BANK BANK INSURANCE NCBA LOOP DFS BANCASSURANCE INVESTMENT KEN
Slide 6: The NCBA Way
PG 6 WHO WE ARE Welcome to the bank that says Go For It, Welcome to the bank that banks on your ambition, Welcome to NCBA The NCBA Way Our Purpose Our Values • Driven To be the Financial • Open Partner that Inspires • Responsive your Growth • Trusted Who We Are and What Guides us Our Customer Promis
Slide 7: Our footprint demonstrates a diversified group across the region
PG 7 WHO WE ARE Our footprint demonstrates a diversified group and a unique financial services partner across the region UGANDA Banking Business 5 Branches Customers • 7.9K Core Bank KES 116Bn KES 496Bn KES 317Bn • 13.5Mn Digital Capital Deposits Lending ~USD 897Mn ~USD 4Bn ~USD 2Bn 3,761 Staff KES
Slide 8: Notable awards and recognitions
PG 8 WHO WE ARE We have received several notable awards, including recent recognitions for diversity & inclusion, SME financier of the year, excellence in customer experience and sustainability 2025 Diversity and 2025 Diversity and 2024 Financial International Kenya Bankers Inclusion Awards & Inclus
Slide 9: Led by an exceptional team
PG 9 WHO WE ARE We are led by an exceptional team which has demonstrated resilience and agility in responding to market dynamics and pursuing growth with an average tenure of 10yrs with the Group
Slide 10: Contents
PG 10 CONTENTS WHO WE ARE < OPERATING ENVIRONMENT < UPDATE ON STRATEGY < FINANCIAL PERFORMANCE Q1 2025 <
Slide 11: Global economic growth expected to decline in 2025
PG 11 OUR OPERATING ENVIRONMENT Global economic growth is expected to decline to 2.8% in 2025 from 3.2% in 2024 due to the impacts of US led tariff interventions on global trade Global growth lower across all the Global inflation is projected to fall to Uncertainty in US monetary policy rate 1 main
Slide 12: Divergent outlook across the region
PG 12 OUR OPERATING ENVIRONMENT Divergent outlook across the region; subdued growth in Kenya and Rwanda with Uganda showing growth momentum, with marked currency depreciation in Tanzania KENYA UGANDA RWANDA TANZANIA • Economic activity subdued across most • Business conditions remain favorable. • Ou
Slide 13: Contents
PG CONTENTS WHO WE ARE < OPERATING ENVIRONMENT < UPDATE ON STRATEGY < FINANCIAL PERFORMANCE Q1 2025 <
Slide 14: Our strategy continues to deliver with Group ROAE at 19.4%
PG 14 OUR STRATEGY Amidst mixed economic conditions; our strategy continues to deliver with our Group ROAE registering at 19.4% Our Measures of Success Key Outcomes Q1 24 Q1 25 Become a Distinguished Brand Core Retail 397 Known For Customer Experience 328 PAT (KES) Customer Count (‘000) Scale Retail
Slide 15: Brand investments driving market consideration
PG 15 OUR STRATEGY Our investments in the NCBA brand is driving market consideration; we also invested in the rebranding of our latest subsidiary NCBA IG. These efforts boosted customer acquisition Enablers Our Brand Health Brand Consideration* Brand Power Index + 5 Brand Assets NCBA Johari Awards 4
Slide 16: Two-thirds of new branches are now profitable
PG 16 OUR STRATEGY Two-thirds of new branches are now profitable, driving customer acquisition & asset growth. Our next priority is to strengthen these relationships to unlock even greater shared value Our increasing footprint continues to support our core bank … with 30 new branches opened , 20 of
Slide 17: Corporate banking: NIM improvements and transactional volume
PG 17 OUR STRATEGY With subdued macro conditions, our corporate banking faced headwinds. Still, we're gaining ground with NIM improvements and boosting transactional volume by deepening relationships & increasing uptake on our varied corporate banking solutions Enablers Corporate Loans (KES Bns) Cor
Slide 18: Higher income growth in asset finance
PG 18 OUR STRATEGY We are seeing higher income growth in asset finance; leveraging on our strategic partnerships & being first to market with innovative solutions Enablers Market Share (%) Total Income (KES M) 15 Sec 1,740 Conditional Approval (1st to Market) 37% 36% 37% 20 29% Scheme Onboarded 883
Slide 19: Strong adoption of mobile banking app in Kenya
PG 19 OUR STRATEGY Capitalizing on our digital banking heritage we have witnessed strong adoption on our mobile banking app in Kenya resulting in increasing active users and a growing on app loan book… 4.2 159 145 114 Digital Loans 1.9 Mobile App Value 1.2 304 123 Active 58 (KES B) 0.7 Customers ('0
Slide 20: KES 307B in digital loans disbursed in Q1-25
PG 20 OUR STRATEGY …and in Q1-25 we disbursed KES 307B in digital loans collaborating with our partners. We witnessed strong growth from majority of our mobile savings & lending solutions across the region Evolution of digital disbursements (KES Bns) Group Fuliza (KE) M-Shwari (KE) LOOP B2C (KE) 271
Slide 21: First bank in Africa to launch Sustainable Development Impact Disclosure
PG 21 OUR STRATEGY We became the first bank in Africa to launch its Sustainable Development Impact Disclosure, a new approach to sustainability reporting under the Impact Disclosure Guidance released in 2024 62K+ More trees Planted in Q1 25 1. Minimize Our Direct Impact On the Climate and Amplify
Slide 22: Boosting productivity with a stable team
PG 22 OUR STRATEGY With a stable team of colleagues, we are boosting productivity at the same time being recognized as a great place to work Employee turnover remains relatively stable, with headcount increasing Talent Recruitment to support organizational growth… Head count Staff Retention 91.5% 96
Slide 23: Five priority areas to embed customer obsession
PG 23 OUR STRATEGY We have identified five priority areas to drive our key transformational goal this year of embedding customer obsession Transformational To Embed Customer Obsession Goal 1 2 3 4 5 Be the primary Embed a Culture Reclaim Corporate Foster a Customer partner for SME Embed Digital at t
Slide 24: Contents
24 22 CONTENTS WHO WE ARE < OPERATING ENVIRONMENT < UPDATE ON STRATEGY < FINANCIAL PERFORMANCE Q1 2025 <
Slide 25: NCBA Group Financial Performance
PG 25 NCBA GROUP FINANCIAL PERFORMANCE Our diversified business model continues to demonstrate growth and resilience, with our digital business leading the charge delivering a 15% profit growth in Q1 2025 Amount in KES Millions (PBT) Amount in KES Millions (PBT) Core Banking Subsidiaries Digital Ban
Slide 26: 22% of top line from outside the Kenya bank
PG 26 NCBA GROUP FINANCIAL PERFORMANCE Our focus on enhancing the contribution from subsidiaries has demonstrated success with our Group deriving 22% of top line outside of our Kenya bank REVENUE % CONTRIBUTION EFFICIENCY RETURNS* TOTAL INCOME COST TO INCOME RATIO RETURN ON AVERAGE EQUITY NCBAK KES
Slide 27: Strong fundamentals with a resilient asset base
PG 27 NCBA GROUP FINANCIAL PERFORMANCE Our Group continues to demonstrate strong fundamentals with a resilient asset base which is delivering stability in our earnings Amounts in KES Bns Balance Sheet Income Statement ROAA Gross Loans NPL ratio Total NFI/Total Total Assets Customer Deposits LDR PBT
Slide 28: Regional business performance
PG 28 NCBA GROUP FINANCIAL PERFORMANCE Our regional Business performance has followed a sustainable growth trajectory, establishing a strong foundation as a future growth engine Regional Revenue (KES M) % Share to Group Regional PBT (KES B) % Share to Group 16.5% 14.6% 12.0% 12.7% 12.1% 10.8% 1,125
Slide 29: AI credit scoring improving digital credit metrics
PG 29 NCBA GROUP FINANCIAL PERFORMANCE By leveraging AI capabilities in credit scoring, we have significantly improved our digital credit metrics and delivering strong PBT outcomes. This advancement positions us to achieve scalable growth in the future Total Disbursements (KES Mns) Digital Banking P
Slide 30: Funding mix driving CASA ratios and protecting margins
PG 30 NCBA GROUP FINANCIAL PERFORMANCE We continue to ensure our funding mix delivers strong bottom- line outcomes driving our CASA ratios and protecting margins Amounts in KES Bns Drive towards a more optimal & better priced funding mix ….this increased our CASA ratio to 53% and is also reflective
Slide 31: Protecting the bottom line by reducing deposit costs
PG 31 NCBA GROUP FINANCIAL PERFORMANCE On the back of interest rate pressures, we focused on protecting our bottom line by deliberately reducing deposit costs ensuring margin protection A deliberate decision to protect our margins has led to visible … and delivering resilient net interest income per
Slide 32: Non-funded income streams
PG 32 NCBA GROUP FINANCIAL PERFORMANCE Our non funded income streams received a healthy boost from fees derived from varied solutions we offer our clients Y-o-Y deposits declined collectively due to subdued …we nonetheless continue see solid performance in fees derived macro conditions and tight mon
Slide 33: Credit outcomes show improved loan quality
PG 33 NCBA GROUP FINANCIAL PERFORMANCE Our credit outcomes continue to show improvement in loan quality albeit on the back of softness in lending y-o-y… We experienced softness in lending given mixed economic …however, we continue to deliver a better-quality loan book conditions… compared to similar
Slide 34: Adequate provisioning and coverage across loan buckets
PG 34 NCBA GROUP FINANCIAL PERFORMANCE …with adequate provisioning and coverage across loan classification buckets… Stage 1 Stage 2 Stage 3 Coverage 1.1 13.3% 56.7% 63.0% Ratio (%) 0.8 0.9 12.8% 12.6% 55.8% 274 38 244 40 242 33 39 37 35 Gross Loans & Advances (KES Bns) Q1 23 Q1 24 Q1 25 Q1 23 Q1 24
Slide 35: Strategic investments and cost to income ratio
PG 35 NCBA GROUP FINANCIAL PERFORMANCE We continue to make strategic investments, notably in our distribution network & digital platforms and these have put pressure on our near-term efficiency metrics. We are focused on a 45% CIR in the medium term OPEX Increased at a slower pace of 10% in Q1 25 as
Slide 36: Group remains well capitalized
PG 36 NCBA GROUP FINANCIAL PERFORMANCE The Group remains well capitalized providing ample room to invest for growth…. Total Capital/RWA across our Markets Minimum Requirements Buffer Q1 25 Q1 24 7.1% 21.6% 18.0% Group 14.5% 14.5% 6.3% 20.8% 17.5% NCBAK 14.5% 25.8% 40.3% 32.5% NCBAU * 14.5% 24.6% 20.
Slide 37: Desired return outcomes for a Tier 1 Bank
PG 37 NCBA GROUP FINANCIAL PERFORMANCE …and delivering the desired return outcomes for a Tier 1 Bank over the last 3 years We are delivering on post merger promises on ROE …while matching similar sized peers on ROA 21.9% 3.4% 21.4% 19.4% 3.0% 2.9% Q1 23 Q1 24 Q1 25 Q1 23 Q1 24 Q1 25
Slide 38: FY 2025 Guidance
PG 38 FY 2024 GUIDANCE We expect a continued and strong underlying growth trajectory across the following metrics Metric FY 25 Guidance Commentary • Create value for our shareholders and re-invest Return on Equity >22% internal capital generated to foster growth • Unlock more capital allocation to n
Slide 39: Contents
39 34 CONTENTS WHO WE ARE < OPERATING ENVIRONMENT < UPDATE ON STRATEGY < FINANCIAL PERFORMANCE Q1 2025 <
Slide 40: Q1 2025 Key Messages
PG 40 Q1 2025 KEY MESSAGES 1 2 3 Solid fundamentals across Well controlled risks We have delivered on our our business long term strategic ambitions Delivered a resilient ROAE of 19.4% & We are delivering a better-quality Expanded our retail banking footprint, maintained strong capitalization
Slide 41: Disclaimer
PG 41 Disclaimer: These results are provided for informational purposes only and should not be construed as an offer to buy or sell any securities or financial instruments. With regards to any market or other third-party data included in this release, NCBA Group Plc (“the Group”) can provide no assu
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Slide 43: Statement of Profit & Loss
PG 43 APPENDIX I Statement of Profit & Loss Amounts in KES Millions NCBA Bank Kenya NCBA Group Consolidated Q1 24 Q1 25 ∆% Q1 24 Q1 25 ∆% Interest Income 17,031 15,217 (11%) 19,105 17,173 (10%) Interest Expenses (9,976) (6,381) (36%) (10,837) (7,203) (34%) Net Interest Income 7,056 8,836 25% 8,268 9
Slide 44: Statement of Financial Position
PG 44 APPENDIX II Statement of Financial Position Amounts in KES Millions NCBA Bank Kenya NCBA Group Consolidated Q1 24 Q1 25 ∆% Q1 24 Q1 25 ∆% Assets Net Loans and Advances 282,693 254,883 (10%) 320,505 287,016 (10%) Investments 188,519 193,315 3% 212,570 222,262 5% Cash and Balances with Banks 93,
Slide 45: Our loan book is well diversified
PG 45 APPENDIX III Our loan book is well diversified across product, currency and industry Q1 2025 Loan Book Loan Book by Sector Loan Book by Segment Loan Book by Currency Manufacturing 23% Personal 21% Trade 15% SME 17% FCY, Transport 13% 28% Mortgate & Real Estate 8% Financial Services 8% Personal