Slide 1: Q2 2012 Results Presentation
Emirates NBD Q2 2012 Results Presentation June 23, 2012 1 1
Slide 2: Important Information
Important Information Disclaimer The material in this presentation is general background information about Emirates NBD's activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to
Slide 3: Q2 2012 Financial Results Highlights
Q2 2012 Financial Results Highlights Highlights Key Performance Indicators Net profit of AED 647 million, +1% vs. Q1 AED million Q2 2012 Q2 2011 Change Q1 2012 Change 2012 and -13% vs. Q2 2011 (%) (%) Net interest income down 8% q-o-q and 5% Net interest income 1,639 1,731 -5% 1,777 -8% y-o-y to
Slide 4: Net Interest Income
Net Interest Income Highlights Net Interest Margin (%) NIM declined by 35 bps from 2.63% in Q1 3.01% 2012 to 2.28% in Q2 2012 resulting in an 8% 2.96% 2.81% 2.79%2.85% 2.85% q-o-q drop in net interest income to AED 1,639 million 2.59% 2.58% 2.56% 2.63% 2.76%2.81% 2.52% 2.53% Q2 2012 NIM reductio
Slide 5: Funding and Liquidity
Funding and Liquidity Highlights Loan to Deposit Ratios (%) Headline LTD ratio of 100% at Q2 2012 Headline LTD Ratio % The LTD ratio is being managed to the target 126% 127% range of c.95%-100% 118% 118% Liquid assets (excl. Investments) of AED 48.8 111% billion as at 30 June 2012 (16% of tota
Slide 6: Loan and Deposit Trends
Loan and Deposit Trends Highlights Trend in Gross Loans by Type (AED billion) Signs of modest pickup in new underwriting -4%* +5%* from H2 2011: 221 223 218 216 218 +2% 211 209 209 8 – Annualised decline in gross loans of 4% from 173 174 205 204 204 8 9 172 167 Q4 2009 to Q2 2011 166 168 – Annuali
Slide 7: Non Interest Income
Non Interest Income Highlights Composition of Non Interest Income (AED million) Non-interest income declined by 5% q-o-q AED million Q2 2012 Q2 2011 Change Q1 2012 Change and improved 2% y-o-y; impacted by non-core (%) (%) items: Core gross fee income 748 592 +26% 740 +1% – Lower investment securi
Slide 8: Operating Costs and Efficiency
Operating Costs and Efficiency Highlights Cost to Income Ratio (%) Costs improved by AED 48 million or 5% Cost to income ratio (YTD) q-o-q to AED 894 million in Q2 2012 resulting from: – AED 42 million reduction in staff costs 35.7% – AED 13 million reduction in other costs 35.3% 35.1% 35.4% 34.9%
Slide 9: Credit Quality
Credit Quality Highlights Impaired Loan & Coverage Ratios (%) • Q2 2012 impairment charge of AED 955 83% 102% 71% 72% 70% million driven mainly by specific provisions of AED 744 million and AED 467 million made in 41% 43% 45% 46% relation to the corporate and Islamic financing portfolios respectivel
Slide 10: Capital Adequacy
Capital Adequacy Highlights Capital Ratios - Basel II (AED billion) CAR improved 0.4% q-o-q to 19.5% and T1 18.7% 19.8% 20.5% 19.1% 19.5% improved 0.3% q-o-q to 12.8% resulting from an 11.9% 12.6% 13.0% 12.5% 12.8% increase in Tier 1 capital by AED 0.6 billion in Q2 2012 due to net profit generati
Slide 11: Divisional Performance: Wholesale Banking and Consumer Banking & Wealth Management
Divisional Performance Balance Sheet Trends Revenue Trends AED billion AED million Key focus during Q2 2012 was on continued strategy re- alignment to ensure enhanced future customer service -11% Wholesale Banking +3% quality and share of wallet, increased cross-sell of Treasury 162.0 163.6 167.1
Slide 12: Divisional Performance: Emirates Islamic Bank and Global Markets & Treasury
Divisional Performance Revenue Trends Global Markets & Treasury AED million Revenue declined 21% q-o-q but improved 9% y-o-y to +9% AED 196 million in Q2 2012 Treasury sales recorded a good performance during Q2 247 2012 as the low interest rate scenario encouraged some 196 -21% 180 clients to l
Slide 13: Strategic Imperatives
Strategic Imperatives 2012 Objectives Evidence of Success in H1 2012 1 Maintain headline LTD ratio within 95% - Headline LTD ratio of 98% in Q1 2012 and 100% 100% target range in Q2 2012 from 105% in Q4 2011 Continue to focus on liabilities growth Strong CASA growth of 11% or AED 8.8 billion
Slide 14: Strategic Imperatives
Strategic Imperatives 2012 Objectives Evidence of Success in H1 2012 2 Revenue growth CWM fee income up 30% in H1 2012 vs. H1 2011 – Increase cross-sell and bolster fee based Developed a strategic plan and roadmap for the business within the Consumer Banking and wholesale bank to transform int
Slide 15: Strategic Imperatives
Strategic Imperatives 2012 Objectives Evidence of Success in H1 2012 3 Continue to upgrade and enhance IT Lean transformation in second wave with focus platforms – undertake implementation of the on IT portfolio rationalisation to focus on IT lean transformation initiative which was developments
Slide 16: Strategic Imperatives
Strategic Imperatives 2012 Objectives Evidence of Success in H1 2012 3 Exploit domestic opportunities Optimised distribution set-up – Continue to enhance domestic – Further optimised branch set-up (elimination of distribution network through selecting, and duplication) implementing the most opti
Slide 17: Outlook
Outlook During H1 2012 the UAE economy continued to display resiliency and modest growth with oil output rising 4.1% and modest private sector expansion Continued strength and growth witnessed in Dubai’s traditional trade, logistics, tourism and retail sales sectors and signs of green shoots in
Slide 18: Summary
Summary Net profit growth of 1% q-o-q to AED 647 million Top-line trends impacted by margin compression, but core fee income generation continued to improve with 4% growth q-o-q Operating expenses improved 5% q-o-q and will be managed to a longer term cost income ratio target of 33%-34% NPL formatio
Slide 19: Investor Relations
Investor Relations PO Box 777 Emirates NBD Head Office, 4th Floor Dubai, UAE Tel: +971 4 201 2606 Email: IR@emiratesnbd.com Ben Franz-Marwick Head, Investor Relations Tel: +971 4 201 2604 Email: bernhardf@emiratesnbd.com Shagorika Cairae Senior Analyst, Investor Relations Tel: +971 4 201 2620 Email: