Metropolitan Bank & Trust Co. · PSE:MBT
Metropolitan Bank & Trust — Q3 2022 Earnings Presentation
42 slides from Metropolitan Bank & Trust's earnings presentation, November 2022
Slide 1: 3Q 2022 Company Presentation
3Q 2022 COMPANY PRESENTATION
Slide 2: Internal use notice
2022 Metropolitan Bank & Trust Company This document is for internal use only and may contain privileged, proprietary or otherwise private information. It must not be released to other parties in whatever form without prior consent to the authors.
Slide 3: Macroeconomic View
MACROECONOMIC VIEW > Metrobank aa You're in good hands
Slide 4: Macro-economic backdrop
Macro-economic backdrop GDP Inflation Policy rate 2020 2021 1Q22 2Q22 2020 2021 10M22 Oct-22 2020 2021 Sep-22 -9.5% 5.7% 8.2% 7.4% 2.4% 3.9% 5.4% 7.7% 2.0% 2.0% 4.25% • Increase in food and utilities prices pushed • Reopening driving the economic rebound October inflation to 7.7% from 6.9% in • BSP
Slide 5: Metrobank Economic Research Forecasts
Metrobank Economic Research Forecasts As of November 2022 2021A 2022F 2023F GDP 5.7% 6.8% 6 – 7% (2018=100) (DBCC1: 6.5-7.5%) (DBCC1: 6.5-8%) (IMF: 6.5%) (IMF: ~5%) Inflation 3.9% 5.8% 4 – 6% (2018=100) (DBCC1: 4.5-5.5%) (DBCC1: 2.5-4.5%) (BSP, 5.6%2) (BSP, 4.1%2) BSP RRP rate 2.0% 5.50% 5.75 – 6.25
Slide 6: Banking Industry: Loan recovery amid improving NPLs
Banking Industry: Loan recovery amid improving NPLs Recovery in loan growth continues, asset quality improves Easing deposit and CASA growth Loan growth Deposit growth CASA growth 18% 17% 18% 14% 20% 15% 15% 15% 14% 12% 9% 9% 10% 15% 10% 8% 9% 9% 4% 6% 7% 7% 2% 10% 14% 12% -1.2% 5% 0% 9% 7% 9% 8% 8%
Slide 7: Financial Performance 9M 2022
FINANCIAL PERFORMANCE 9M 2022
Slide 8: Improving NII, better fees, stable opex, lower provisions
Improving NII, better fees, stable opex, lower provisions Net Interest Income Fees and Other Non-Interest Income Trading & FX gains Operating expenses Provisions for credit losses Taxes and NCI YoY YoY Net 110.0 Net Income 16.1 23.4 +45% Income 4.4 6.0 8.0 7.6 7.8 +77% 35.0 90.0 2.5 -43% 4.3 17.7 2.
Slide 9: Improving net interest income and NIM
Improving net interest income and NIM Interest income building up Margins on an uptrend Pbn Interest from Loans Interest expense from Deposits Pbn NII Quarterly NIM Interest from Investments Other Interest Expense Other Interest Income 4.00% 31.0 27.0 3.7% Higher accrual 3.4% 3.4% 3.4% 26.0 +72% YoY
Slide 10: Loan book expanding, driven by corporate demand
Loan book expanding, driven by corporate demand Strong commercial demand driving loan growth Positive loan momentum sustained Pbn Consumer Corporate & Commercial MBT Gross Loans growth 12% 1,372 +12% YoY 1,322 9% 1,279 1,263 +4% QoQ 1,220 5% 1,049 1,092 +15% YoY 950 1,011 996 -1% +4% QoQ -4% -13% -1
Slide 11: Corporate segment driving loan demand
Corporate segment driving loan demand Corporate continues to lead growth Loans by remaining maturity (Parent only) Pbn SME Corporate & Middle Market Long term Short term 1,200 1,092 +15% YoY 1,049 1,011 996 +4 QoQ 1,000 950 800 51% 57% 53% +14% YoY +18% YoY 600 937 981 833 897 887 +5% QoQ 400 +7% Yo
Slide 12: Consumer loans driven by credit cards
Consumer loans driven by credit cards Consumer Loans Breakdown Consumer Loans By Product Pbn Others Auto Housing Credit Card* 273 280 +4% YoY 270 269 267 +3% QoQ 32% 34% 35% 37% 38% 87 92 100 107 +22% YoY 93 +7% QoQ 36% 36% 36% -5% YoY 35% 33% 98 98 96 94 -1% QoQ 94 -5% YoY 30% 28% 28% 28% 27% 80 76
Slide 13: Encouraging trends in big-ticket consumer loans production
Encouraging trends in big-ticket consumer loans production New car loans production accelerates New home loans on an uptrend +105% YoY +43% YoY New car loans New home loans 130% 110% 105% 90% 68% 50% 43% 34% 70% 51% 40% 21% 50% 30% 30% 25% 20% 10% 10% 3% 0% -10% -4% -10% -30% -9% -20% 3Q21 4Q21 1Q22
Slide 14: CASA generation sustained
CASA generation sustained CASA continues to pick up CASA ratio eases but still above pre-pandemic level Pbn TDs CASA CASA TDs +11% YoY 25% 24% 29% 28% 29% 2,042 2,061 2,049 -1% QoQ 1,930 1,851 75% 76% 71% 72% 71% 3Q21 4Q21 1Q22 2Q22 3Q22 +5% YoY 1,443 1,479 1,458 -1% QoQ 1,387 1,463 CASA Deposits pe
Slide 15: Improving margins
Improving margins Better asset yields offsetting uptick in funding costs Stable to improving yields across segments 18.0% Quarterly NIM Loan yield 15.5% Asset yield Investment securities yield 16.0% 15.0% 14.3% 14.3% 14.1% Funding cost Deposit cost 14.0% 6.50% 5.7% Credit Cards 5.5% 5.6% 5.50% 5.1%
Slide 16: Rising fee income supporting non-interest income
Rising fee income supporting non-interest income Healthy fee income growth Consumer driving fee-based income Pbn Others Gain On Asset Sales Pbn Fee income Trust income Leasing Service Fees & Trust YoY 7.0 Trading & FX gains 14.0 12.3 +12% 6.0 YoY 25.0 12.0 10.9 1.2 -6% YoY 5.0 4.1 4.2 +12% 10.0 1.2
Slide 17: Costs kept under control
Costs kept under control Steady opex levels Improving cost-to-income ratio Pbn Occupancy & equipment Depreciation Taxes & licenses Manpower 25.0 65.0% YoY 50.0 60.0% 59.0% 59.0% 44.4 44.5 0% YoY 54.5% 20.0 55.0% 54.1% 53.8% 0% 40.0 15.1 15.0 14.9 14.6 15.1 50.0% 19.1 19.0 0% 15.0 45.0% +1% 30.0 6.3
Slide 18: Lower provisions, ample cover maintained
Lower provisions, ample cover maintained Credit costs continue to ease Hefty provision cover Est. Credit Cost (bps) 120 98 100 80 58 64 55 56 60 40 191% 196% 20 175% 179% - Pbn Cumulative Total Allowance Provisions for Credit 172% 70.0 14.0 60.0 50.0 49 48 48 49 49 12.0 10.0 40.0 8.0 30.0 6.0 20.0 4
Slide 19: Asset quality better than industry
Asset quality better than industry NPL and Past Due loans NPL and Past Due ratios much lower than industry Past Due ratio Industry Past Due Pbn Past Due NPL 5.2% 4.8% 6.0% 4.6% 60.0 4.2% 4.2% 5.0% 4.0% 50.0 3.0% 50.0 3.0% 2.8% 3.0% 2.0% 36 36 37 2.5% 2.5% 35 40.0 1.0% 32 40.0 0.0% 30.0 30.0 3Q21 4Q2
Slide 20: Asset quality better than industry
Asset quality better than industry Restructured loans level off Combined NPLs/Restructured still below Industry NPL Ratio Ratio to Gross Loans Industry Restructured Loans Ratio Industry NPL Ratio MBT Combined NPL + Restructured Loans as Ratio to Gross Loans 4.5% 3.1% 3.1% 3.0% 4.0% 2.9% 2.7% 4.6% 3.
Slide 21: NPLs remain manageable despite uptick
NPLs remain manageable despite uptick Commercial NPLs Consumer NPLs NPLs NPL ratio NPL ratio Industry Consumer NPL ratio 9.9% 16.0% 9.3% 9.0% 14.0% 8.1% 35 1.6% 1.6% 1.7% 1.5% 1.9% 12.0% 10.0% 8.0% 4.6% 0.0% 4.2% 30 6.0% 3.8% 3.3% Pbn 4.0% 2.8% 25 21 2.0% -5.0% 0.0% 25 17 20 15 17 16 20 Pbn -10.0% 1
Slide 22: Consumer NPLs well below industry levels
Consumer NPLs well below industry levels Auto Home Credit Cards NPLs NPL ratio Industry NPLs NPL ratio Industry NPLs NPL ratio Industry 20 12.7% 14.0% 9.4% 9.4% 12.0% 11.4% 20 9.6% 15.0% 8.6% 20 18 10.6% 15% 12.0% 18 18 16 14 10.0% 16 16 8.0% 6.5% 10.0% 8.0% 14 14 6.8% 5.8% 10% 12 5.0% 5.2% 12 5.1%
Slide 23: Other asset quality indicators remain stable
Other asset quality indicators remain stable Real and other properties acquired (ROPA) Non-Performing Assets (NPA) Pbn Pbn ROPA Ratio to Gross Loans NPA NPA Ratio 0.8% 0.8% 0.8% 0.8% 1.5% 15.0 0.9% 50 1.7% 0.8% 1.5% 1.4% 1.4% 13.0 0.8% 45 1.3% 1.5% 0.7% 1.3% 11.0 40 0.6% 1.1% 9.0 0.5% 35 0.9% 7.0 0.
Slide 24: Healthy capital and liquidity levels provide ample support
Healthy capital and liquidity levels provide ample support Capital Ratios above minimum thresholds High Basel III Leverage Ratio, Liquidity Coverage Ratio CAR CET-1 BLR LCR 20.1% 19.3% 18.5% 17.6% 17.6% 15.0% 350% 327% 17.2% 16.8% 16.3% 300% 284% 11.0% 249% 9.6% 9.5% 9.4%250% 232% 10.0% Min. CET1 20
Slide 25: Improving digital metrics on retail clients
Improving digital metrics on retail clients Digital penetration rate on a continuous upward trend, 2019 2020 2021 9M22 now at 31%, with 1.4M total digital users 575K 730K 920K 1.2M 31% 29% 28% 26% Active base with over 1M users – 86% active rate vs 81% pre-pandemic 23% 19% Continuous growth in mobil
Slide 26: Digital Initiatives to be launched in November 2022
Digital Initiatives to be launched in November 2022 New Digital Onboarding Platform New Metrobank App for Cards & PL • Digital Servicing for our new and existing • Providing customers a seamless and customers through the new mobile app straight-through experience when they apply for a credit card or
Slide 27: 2022 Outlook – Positives and Challenges
2022 Outlook – Positives and Challenges • Recovery in loans in line with economic growth • Prolonged inflationary pressures and forex volatility could temper business and consumer sentiment • Sustained NIM improvement on higher yields and may pose asset quality risks, stalling recovery prospects. •
Slide 28: Summary
SUMMARY Metrobank’s solid performance thus far is evident on all fronts: loan recovery, improving margins, healthy fee income, and stable operating costs. Manageable asset quality and high reserves easing provisioning needs. Digitization efforts support initiatives to improve productivity and effici
Slide 29: Financial Summary
Financial Summary In PHP billion Balance Sheet 9M 2021 9M 2022 YoY Income Statement 9M 2021 9M 2022 YoY 3Q 2021 3Q 2022 YoY Total Assets 2,429 2,733 +13% Net Interest Income 56.3 62.1 +10% 18.8 22.3 +18% Loans and Receivables, 1,220 1,372 +12% Gross Non Interest Income 19.5 20.1 +3% 5.5 4.9 -11% Tot
Slide 30: Additional Information
ADDITIONAL INFORMATION > Metrobank aa You're in good hands
Slide 31: Metropolitan Bank & Trust Company (Metrobank)
Metropolitan Bank & Trust Company (Metrobank) Overview Financial Data (PHP bn) 9M22 DIVERSIFIED Total Assets 2,733 60 YEARS OF MULTI-AWARDED FINANCIAL CONGLOMERATE TRADING INFORMATION MBT PM | MBT.PS Ticker Loans and Receivables, Gross Total Deposits 1,372 2,049 SERVICE EXCELLENCE USD 4.0 Bn Market
Slide 32: Ownership and Investment Information
Ownership and Investment Information CORPORATE STRUCTURE MARKET DATA Trading information Ticker: GTCAP PM / GTCAP.PS Market cap: USD1.5 Bn Ty Family Ticker (Bloomberg | Reuters) MBT PM | MBT.PS & Other Free Related float Par value (PHP) 20.00 Parties Outstanding shares 4,497,415,555 37.2% 14.7% 48.1
Slide 33: Extensive Domestic and Overseas Coverage
Extensive Domestic and Overseas Coverage Total Group 16,000+ employee base Domestic Branch and ATM Networks Overseas Network Coverage 940+ 30+ branches Branches, subsidiaries, offices 2,300+ ATMs 140+ Remittance tie-ups 160+ Remittance agents 2022 Metropolitan Bank & Trust Company 33 This material w
Slide 34: Recent Awards and Recognition
Recent Awards and Recognition Best Corporate Bank; Most Helpful Bank in Best Local Currency Top Banking Bond Individuals Best Bank Best Domestic the Philippines; 10th in Strongest Bank Employer Asia Pacific During #1 in Trading, in the Philippines Private Bank in the Philippines #4 & #5 in Sales, in
Slide 35: Meaningful Sustainability
Meaningful Sustainability GOAL 8 Decent Work and Economic Growth – Equivalent to P195 billion. Supported 206 businesses engaged in large scale retail activities, holding companies and financial institutions needing access to financial capital, hotels and restaurants, and professional and technical s
Slide 36: Sustainability: Our Progress in 2021
Sustainability: Our Progress in 2021 Formalizing the governance structure Improving our disclosures: The Board, through the Executive Committee, does the oversight and Senior Management executes the sustainability framework. Our 2021 Sustainability Report The dedicated Sustainability Department, tog
Slide 37: Debt Issuances
Debt Issuances Unissued 2022 28.0 0.5 Bond Issuance 2021 76.3 USD2 Billion PHP23.7 billion PHP200* Medium-Term 42.5 Billion Bond 1.5Y Peso Notes 2020 Programme Note Programme Listed October 2022 2019 1.5 5.0% interest rate p.a. 19.0 23.7 2018 *Note: The Board of Directors of Metrobank approved to up
Slide 38: Outstanding Debt Issuances & Investment Grade Credit Ratings
Outstanding Debt Issuances & Investment Grade Credit Ratings Debt Issuance Details Debt Maturity Profile (PHP Bn) Baa2 Jul-22 Stable Issue Coupon Maturity Amount Type • Robust capitalization, with a proven Date Rate Date (PHP Bn) history of support from shareholders 2022 17.50 Sep-16 3.500% Sep-23 8
Slide 39: Loan Portfolio Breakdown
Loan Portfolio Breakdown MBT Loan Portfolio By Industry Philippine Banks Loan Portfolio By Industry 13% 13% 14% 15% 14% 12% 12% 12% 12% 12% 13% 11% 11% 10% 11% 11% 13% 13% 13% 13% 17% 21% 21% 21% 21% 20% 18% 17% 17% 16% Trade Manufacturing 12% 9% 9% 9% 9% 9% 13% 12% 12% 13% Real estate 7% 10% 10% 10
Slide 40: Currency Breakdown
Currency Breakdown LOAN PORTFOLIO DEPOSITS Foreign Foreign Currency, Currency, 17% 21% Philippine Philippine Peso, 83% Peso, 79% 2022 Metropolitan Bank & Trust Company 40 This material was produced by Metrobank for information purposes only and is intended to be used in presentations by the Bank at
Slide 41: For more information, please visit our website
For more information, please visit our website: Latest Annual Reports 2021 2020 2019 Financial Reports SEC 17-A SEC 17-Q BSP SOC Investor Relations https://metrobank.com.ph/about-us/investor-relations-program Annual Corporate Governance Report For your comments and queries contact us via: https://me
Slide 42: Metrobank
<< Metrobank EA Vourre in good hands ‘THE ASIAN BANKER’ ry Best Domestic Bank BANKQUALITY.COM STRONGEST BANK Inthe Phigiies oa ser 38 IN PHILIPPINES 2021 Asiamoney Best Bank Awards 2021 Pa Se RE by balance sheet
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