Alinma Bank · TADAWUL:1150
Alinma Bank — Q2 2023 Earnings Presentation
29 slides from Alinma Bank's earnings presentation, Jul 27, 2023
Slide 1: Earnings Presentation 2Q 2023
Earnings Presentation 2Q 2023 Earnings Call 27 July 2023 digital. fast. convenient.
Slide 2: Table of Contents
Table of Contents 1 Alinma Overview 2 Financial Performance Highlights 3 Strategy Update 4 1H 2023 Financial Performance 5 Outlook & Guidance 2Q 2023 EARNINGS PRESENTATION 2/29
Slide 3: Alinma Overview
Alinma Overview 2Q 2023 digital. fast. convenient.
Slide 4: Alinma Overview
Alinma Overview Alinma is the youngest bank in KSA 18.7m 631K 98.4% Monthly Average Users Smartphone Daily Average Users Digital Transactions (Number of Smart Phone Users Logins) Retail Digital Snapshot #2 in KSA #4 in KSA #6 in KSA 3.80% NIMs 14.1% ROE 1.9% ROA (1Q 2023) (1Q 2023) (1Q 2023) 6.1% 6.
Slide 5: Financial Performance Highlights
Financial Performance Highlights 2Q 2023 digital. fast. convenient.
Slide 6: Financial Performance Highlights
Financial Performance Highlights Solid operating income growth translated into 25% growth of net income in 1H 2023 and 16.0% ROE Balance Sheet Income Statement Credit Quality, Capital and Liquidity Increase in financing of 10% YTD from growth in Operating income growth of 23% mainly from NPL a
Slide 7: Strategy Update
Strategy Update 2Q 2023 digital. fast. convenient.
Slide 8: Strategic Positioning
Strategic Positioning Alinma Bank's strategic positioning cascades down into each business strategy Be recognized and celebrated as the fastest and Excellence most convenient bank in KSA Shariah Compliance Bank wide Be the #1 in Net Promoter Score (NPS) across KSA Banks Digital Corporate Be the #1 E
Slide 9: Strategic Ambitions
Strategic Ambitions Driving changes across the businesses and bank-wide > Bank-wide Retail Corporate Treasury Build Digital Factory to scale > Build digitally-savvy affluent Become core bank for large, Become core partner for customer experience and and HNW customer franchise mid-corporate and proje
Slide 10: Strategy Update: 2Q 2023 Initiatives Completed to Date
Strategy Update 2Q 2023 Initiatives Completed to Date Bank-wide 24/28 Retail 13/18 Corporate 9/19 Treasury 12/12 Launched Youth App for friends and Implemented digital execution Lunched bundle with Saudi Fintech Expanded derivatives customer family for credit cards (33%) and Technology Company to pr
Slide 11: Strategy Update: 2023 Initiatives In-Progress
Strategy Update 2023 Initiatives In-Progress Bank-wide 4/28 Retail 5/18 Corporate 10/19 Treasury 0/12 Expanding the digital factory for the Designing exclusive private Implementation of Corporate Enhance offering of structured transformation banking experience program Loan Origination System deposit
Slide 12: 1H 2023 Financial Performance
1H 2023 Financial Performance 2Q 2023 digital. fast. convenient.
Slide 13: Balance Sheet Trends
Balance Sheet Trends Balance sheet growth of 13% from increase in financing and investments Management Commentary Total Assets Movement YTD (SARbn) Growth in total assets of 13% YTD mainly driven by 10% financing growth +13% and 4% growth in investments and 81% growth in balances with SAMA and int
Slide 14: P&L Trends
P&L Trends Net income for 1H 2023 grew by 25% YoY due to 23% income growth Management Commentary Net Income Movement YoY (SARmn) Net income for 1H 2023 grew 25% YoY to SAR 2,195mn from 23% income +25% growth. 15% higher operating expenses YoY. 869 7 2Q 2023 net income improved 32% YoY driven by
Slide 15: Financing
Financing Increase in gross financing during 1H 2023 from 12% growth in retail financing, and 10% in corporate financing Financing, Gross (SARbn) Financing, Gross Composition (SARbn) +10% Corporate 13% Total Corporate 157.2 165.9 75% 143.7 150.5 135.1 SME 12% 102.2 107.9 113.2 117.0 124.2 165.9 Home
Slide 16: Deposits
Deposits Deposit growth of 23% driven by 6% CASA growth and 45% time deposits growth Customers' Deposits (SARbn) Customers' Deposits Movement YTD (SARbn) +23% +23% 177.9 159.9 28.0 4.7 177.9 132.0 145.2 130.4 145.2 87.2 84.7 82.5 92.4 86.4 75.2 90.7 45.6 62.7 38.0 QoQ 2Q 22 +1% 3Q 22 +10% 4Q 22 +10%
Slide 17: Income from Financing & Investments
Income from Financing & Investments Gross funded income grew 91% from 51% growth in investment income and 98% growth in financing income Funded Income, Gross (SARmn) Total Funded Income, Gross Movement YoY (SARmn) Management Commentary +92% +91% Gross funded income for 1H 2023 increased by 3,176 9
Slide 18: Fee and Other Income
Fee and Other Income Non-funded income for 1H 2023 increased by 1% YoY Non-Funded Income (SARmn) Non-Funded Income Movement YoY (SARmn) +11% +1% 577 125 40 519 480 1,015 1,022 402 445 192 222 146 95 136 (108) (50) 307 334 308 385 297 QoQ 2Q 22 -23% 3Q 22 +19% 4Q 22 -7% 1Q 23 +30% 2Q 23 Non-funded Fe
Slide 19: Operating Expenses
Operating Expenses 1H 2023 saw 15% growth in operating expenses YoY mainly from higher employee and G&A costs Operating Expenses (SARmn) Operating Expenses Movement YoY (SARmn) +13% +15% 750 758 747 93 18 88 1,504 663 710 1,306 318 319 307 284 305 70 74 73 80 1,504 69 310 334 358 367 359 Operating E
Slide 20: Impairments for Financing
Impairments for Financing Cost of risk for 1H 2023 increased by 10bps from 35% higher credit impairment charges YoY Impairments for Financing (SARmn) Impairments for Financing (SARmn) +31% +35% 436 663 337 326 489 248 273 2Q 22 3Q 22 4Q 22 1Q 23 2Q 23 1H 22 1H 23 QoQ +10% +60% -23% -3% Impairments A
Slide 21: NPL & NPL Coverage
NPL & NPL Coverage NPL ratio and NPL coverage decreased YoY Non-Performing Loans, Gross (SARbn) NPL Ratio (%) 3.00% +7% 2.50% 2.11% 1.90% 1.94% 1.89% 3.3 3.1 2.00% 1.67% 2.9 2.6 2.4 1.50% 2.6 2.5 1.00% 2.5 2.4 2.2 0.50% 0.2 0.2 0.5 0.7 0.6 0.00% QoQ 2Q 22 -7% 3Q 22 +22% 4Q 22 +13% 1Q 23 -5% 2Q 23 2Q
Slide 22: Capitalization & Liquidity
Capitalization & Liquidity Capital and liquidity ratios remained healthy while ROE saw an increase of 2.6ppts YoY Capitalization (%) Profitability (%) Management Commentary 25% 20% CAR has declined 3.6ppts YoY to 18.2% due to 21.8% increase in credit risk weighted assets. 20% 16.0% 18.2% 15% 13.4%
Slide 23: Outlook & Guidance
Outlook & Guidance 2Q 2023 digital. fast. convenient.
Slide 24: Guidance
Guidance Acceleration of strategic execution drives a promising outlook for 2023. Revised guidance for financing growth, NPM and CoR 2Q 2023A Drivers 2023G Balance Sheet Financing Growth +10% Strong Mid-Corp, SME & Retail growth from High teens YTD strategic initiatives; pick up in corporate financi
Slide 25: Q&A
Q&A 2Q 2023 digital. fast. convenient.
Slide 26: Appendix
Appendix 2Q 2023 digital. fast. convenient.
Slide 27: Sustainability
Sustainability Alinma Bank released its 2022 Sustainability Report The first step for the Alinma journey to complete disclosure and reporting for all material factors to give investors and other stakeholders the complete picture on sustainability credentials and progress. It has been prepared using
Slide 28: IR Contacts
IR Contacts Ahmed Sager Head of Investor Relations Mobile: +966-53-775-3352 Direct: +966-11-218-6364 Email: aosager@alinma.com Visit our new website here for more investor disclosures: Ibrahim Al Khudair • Financial statements Investor Relations Assistant Manager • Annual reports Mobile: +966-55-788
Slide 29: Disclaimer
Disclaimer This presentation is being provided to you for general information purposes only. The information contained in the presentation has been obtained from sources believed by Alinma Bank (“Alinma") to be up to date, correct and reliable, but Alinma does not make any representation or warranty