Malayan Banking Bhd. · MYX:MAYBANK

Malayan Banking Bhd — FY2023 Earnings Presentation

52 slides from Malayan Banking Bhd's earnings presentation, Feb 28, 2024

  1. Slide 1: Investor Presentation: Financial Results FY2023

    Disclaimer: The contents of this document/information remain the intellectual property of Maybank and no part of this is to be reproduced or transmitted in any form or by any means, including electronically, photocopying, recording or in any information storage and retrieval system without the permi

  2. Slide 2: Table of Contents

    Table of Contents Executive Summary 2-10 FY2023 Financial Performance 12-18 Appendix: 1. Group Performance 20-40 2. Business/Country Performance 42-50

  3. Slide 3: FY2023: Net Profit Rises to RM9.35 billion from RM7.96 billion A Year Ago

    FY2023: Net Profit Rises to RM9.35 billion from RM7.96 billion A Year Ago Supported by income growth from gains in treasury and markets as well as core fees and lower provisioning FY2023 vs FY2022* Net Operating Net Interest Cost Cost-to- Net Credit Net Return on Income Margin Increased income Ratio

  4. Slide 4: FY2023: Good Momentum on Loans Growth; Stable Asset Quality

    FY2023: Good Momentum on Loans Growth; Stable Asset Quality Total assets exceed RM1 trillion supported Stable liquidity position, CASA ratio Healthy LLC as GIL continued by strong loans growth of 9.2% still above pre-pandemic levels to trend lower QoQ 31 Dec 2023 vs 31 Dec 2022 As at 31 Dec 2023 As

  5. Slide 5: FY2023: Rewarding Shareholders with Strong Returns; Solid Capital Levels

    FY2023: Rewarding Shareholders with Strong Returns; Solid Capital Levels Highest total dividend declared post Robust capital position pandemic at 60 sen per share 91.2% As at 31 Dec 2023 As at 31 Dec 2023 87.8% 84.5% 84.6% Dividend 77.4% Payout Ratio 100% 63% 88% 100% Cash Component 34% of Total Div

  6. Slide 6: FY2023: Exceeded Sustainability Targets and Globally Recognised for Efforts

    FY2023: Exceeded Sustainability Targets and Globally Recognised for Efforts While Making Inroads Towards Net Zero Pathway Key Recognitions and Sustainability Highlights in 2023 Sustainable Finance Only Malaysian company to be included in TIME’s Developed Group Human Rights Policy, outlining our Worl

  7. Slide 7: FY2023 M25+ Progress: Good Traction from Focused Segmentation and Ecosystem Play

    FY2023 M25+ Progress: Good Traction from Focused Segmentation and Ecosystem Play SP3 – Expanding Consumer’s Ecosystem Others, 3% Tech-for-Tech, 10% Current Total M25+ Committed • Expanded homeownership ecosystem by embedding Home2u Mortgage platform into partner’s ecosystem. Enabled Home2u Investmen

  8. Slide 8: FY2023 M25+ Progress: Good Traction (cont'd)

    FY2023 M25+ Progress: Good Traction from Focused Segmentation and Ecosystem Play (cont’d) SP5 & 7 –Building Global Islamic Finance Leadership through SP4 – Scaling Up SMEs Across Markets IWM and Halal Ecosystem • SME Re-segmentation in SG (from April 2023) & IDN (from June • Strong traction from Isl

  9. Slide 9: FY2023 M25+ Progress: Intensified Customer-Centricity Via Digitalisation

    FY2023 M25+ Progress: Intensified Customer-Centricity Via Digitalisation and Agile Ways of Working SP6 – Leading Digital Insurer SP11 & SP12 – Driving Hyper-Personalised Solutions • Improved convenience for motor insurance vehicle renewal: Shortened • Enable cross-selling through targeted customer h

  10. Slide 10: 2024: Improved Economic Growth in Home Markets

    2024: Improved Economic Growth in Home Markets with Potential Interest Rate Reductions in Singapore and Indonesia Malaysia Singapore Indonesia 2023 2024 (f) YoY Trend 2023 2024 (f) YoY Trend 2023 2024 (f) YoY Trend GDP 3.7% 4.4%  GDP 1.1% 2.2%  GDP 5.0% 5.1%  System loan 5.3% 4.6%  System loan (

  11. Slide 11: FY2024: Focus on Revenue Uplift and AQ Preservation

    FY2024: Focus on Revenue Uplift and AQ Preservation; Drive Stronger M25+ Momentum Leveraging Targeted Investments • Focus on growth opportunities across Group CFS, Group GB and Group Insurance & Takaful within the ASEAN franchise: o Double down on mortgage, RSME and SME+ portfolios across universal

  12. Slide 12: Table of Contents

    Table of Contents Executive Summary 2-10 FY2023 Financial Performance 12-18 Appendix: 1. Group Performance 20-40 2. Business/Country Performance 42-50

  13. Slide 13: Strong Group Loans Growth of 9.2%; Net Fund Based Income Impacted by NIM Compression

    Strong Group Loans Growth of 9.2%; Net Fund Based Income Impacted by NIM Compression Arising From Higher Funding Cost NIM and Net Fund Based Income Key Drivers • Group loans grew 9.2% YoY led by: o 8.7% in SG: 4.0% in Auto Loan, 5.3% in Cards, 15.0% in Non-Retail and 16.0% in Corporate Banking NIM 2

  14. Slide 14: Higher NOII of RM8.06 billion on Better Treasury and Markets Income

    Higher NOII of RM8.06 billion on Better Treasury and Markets Income Non-Interest Income Key Drivers  9.1%  40.3%  38.3% YoY 4Q’23 vs 3Q’23 4Q’23 vs 4Q’22* • Core fees rose by 7.4% YoY on higher service charges and fees, commission and 8.06 underwriting fees: 1.94 2.11 0.05 0.04 5.83 0.22 1.50 0.0

  15. Slide 15: Group Insurance & Takaful Net Operating Income and Profit Before Tax Improved

    Overall Group Insurance & Takaful Net Operating Income and Profit Before Tax Improved Key Drivers Group Insurance & Takaful* • Insurance & takaful’s FY2023 NOI more than doubled to RM1.16 billion as: Net Operating Income (RM billion) o Life and Family Takaful NOI was RM0.55 billion on higher profit/

  16. Slide 16: Cost Increase on Higher Personnel, IT and Revenue-Related Expenses

    Cost Increase on Higher Personnel, IT and Revenue-Related Expenses CIR and Costs Key Drivers 48.8% 51.9% 48.9% 46.1% 45.2%  9.8%  15.3%  11.8% YoY 4Q’23 vs 3Q’23 4Q’23 vs 4Q’22* • Cost increase of 11.8% YoY due to: 13.39 o +10.9% increase in personnel costs, which includes the conclusion 3.62 3.3

  17. Slide 17: Healthy Liquidity Levels

    Healthy Liquidity Levels Liquidity Indicators Key Drivers LCR LDR NSFR • Group liquidity ratios remained healthy with NSFR and LCR 145.4% Liquidity Position levels above regulatory requirements 137.4% 142.1% 118.1% 116.8% 122.0% • Group gross deposits grew 9.0% YoY supported by: 91.7% o SG’s 13.5% i

  18. Slide 18: Improving Group GIL ratio; Management Overlay Maintained

    Improving Group GIL ratio; Management Overlay Maintained Loan ECL, NCC, and LLC Gross Impaired Loans (GIL) P&L ECL  +5.4%  +53.6%  (16.3)% YoY Dec 2022 Sep 2023 Dec 2023 (RM billion) 4Q’23 vs 3Q’23 4Q’23 vs 4Q’22 % RM billion % RM billion % RM billion Non Performing Loans 1.22% 7.14 1.06% 6.51 1.

  19. Slide 19: Robust Capital Positions

    Robust Capital Positions Capital Ratios Key Drivers After proposed dividend • Capital ratios remain robust with Group CET1 capital ratio at 15.34% and Group total capital ratio at 18.56%, well above regulatory requirements 18.20% 18.56% • Credit RWA growth of 2.9% QoQ below loans growth of 3.9% ensu

  20. Slide 20: Table of Contents

    Table of Contents Executive Summary 2-10 FY2023 Financial Performance 12-18 Appendix: 1. Group Performance 20-40 2. Business/Country Performance 42-50

  21. Slide 21: P&L Summary: FY2023

    P&L Summary: FY2023 4Q FY2022 4Q 3Q 2Q 1Q RM million FY2023 YoY QoQ FY2022 YoY (Restated) FY2023 FY2023 FY2023 FY2023 (Restated) Net fund based income * 19,301.9 20,666.5 (6.6)% 4,865.3 4,814.3 1.1% 4,825.5 4,796.7 5,306.7 (8.3)% Non-interest income * 8,059.3 5,825.8 38.3% 2,111.6 1,935.8 9.1% 2,484

  22. Slide 22: Segmental Performance of Businesses: FY2023 (1/2)

    Segmental Performance of Businesses: FY2023 (1/2) Net Operating Income Group Global Banking  (6.1)% FY2022* FY2023  +3.3% FY2022: 9,997 FY2023: 9,391 26,492 27,361  +8.3%  (7.4)%  +3.3%  (1.7)%  +>100% 15,621 16,912 RM million 8,698 8,055 1,195 1,235 103 102 505 1,163 Total Group Community Gr

  23. Slide 23: Segmental Performance of Businesses: FY2023 (2/2)

    Segmental Performance of Businesses: FY2023 (2/2) Net Fund Based Income  (6.6)% Group Global Banking  (9.6)% FY2022* FY2023 20,666 19,302 FY2022: 5,998 FY2023: 5,422  +7.4% 12,956  (11.2)%  +16.7%  +62.1%  +15.9% 12,064 RM million 5,671 5,038 379 5 1,483 1,719 325 3 Total Group Community Grou

  24. Slide 24: Group Non-Interest Income: FY2023

    Group Non-Interest Income: FY2023 4Q FY2022 4Q 3Q 2Q 1Q NOII (RM million) FY2023 YoY QoQ FY2022 YoY (Restated) FY2023 FY2023 FY2023 FY2023 (Restated) Commission, service charges and fees 4,044 3,766  7.4% 1,110 1,069  3.8% 940 926 911  21.9% Commission 1,401 1,369  2.3% 358 355  0.8% 346 341 34

  25. Slide 25: International & Malaysia Portfolio Mix FY2023

    International & Malaysia Portfolio Mix FY2023 Net Operating Income Profit Before Tax Gross Loans * 4.8% FY2023 6.2% 7.4% (Jan 23 – Dec 23) 6.2% 5.5% 10.1% 18.5% Overseas: RM27.4 Overseas: RM12.5 Overseas: RM640.8 17.6% 26.7% 33.9% billion 29.5% billion 39.6% billion 60.4% 66.1% 70.5% Malaysia Singap

  26. Slide 26: Group Gross Loans Growth: 31 December 2023

    Group Gross Loans Growth: 31 December 2023 % of 31 Dec 2022 31 Dec 2023 30 Sep 2023 QoQ 30 Jun 2023 31 Mar 2023 YoY Portfolio (Restated) Group Gross Loans 640.8 617.0  3.9% 605.8 591.7 586.9  9.2% Malaysia (RM billion) 60% 387.2 370.7  4.5% 363.3 363.7 362.9  6.7% Community Financial Services 77

  27. Slide 27: Malaysia Loans Growth: 31 December 2023

    Malaysia Loans Growth: 31 December 2023 31 Dec 2022 RM billion % of Portfolio 31 Dec 2023 30 Sep 2023 QoQ 30 Jun 2023 31 Mar 2023 YoY (Restated) Community Financial Services (reported) 77% 298.3 289.8  2.9% 283.5 279.7 278.4  7.2% Community Financial Services (rebased)¹ 77% 298.3 289.8  2.9% 283.

  28. Slide 28: Singapore Loans Growth: 31 December 2023

    Singapore Loans Growth: 31 December 2023 SGD billion % of Portfolio 31 Dec 2023 30 Sep 2023 QoQ 30 Jun 2023 31 Mar 2023 31 Dec 2022 YoY Community Financial Services 53% 25.1 25.1  (0.0)% 24.7 24.3 24.6  1.8% Consumer 37% 17.3 17.6  (1.5)% 17.5 17.6 17.9  (3.2)% Housing Loan 26% 12.0 12.4  (2.2)

  29. Slide 29: Indonesia Loans Growth: 31 December 2023

    Indonesia Loans Growth: 31 December 2023 (Based on MBI’s reporting) IDR trillion % of Portfolio 31 Dec 2023 30 Sep 2023 QoQ 30 Jun 2023 31 Mar 2023 31 Dec 2022 YoY Community Financial Services 64% 74.3 71.7  3.6% 69.4 67.9 67.2  10.6% CFS Retail 38% 43.5 42.8  1.7% 41.5 40.1 39.0  11.5% Auto Loa

  30. Slide 30: Group Deposits Growth: 31 December 2023

    Group Deposits Growth: 31 December 2023 31 Dec 2022 % of Portfolio 31 Dec 2023 30 Sep 2023 QoQ 30 Jun 2023 31 Mar 2023 YoY (Restated) Group Gross Deposits 696.8 661.8  5.3% 654.8 651.3 639.4  9.0% Total CASA 257.3 255.2  0.8% 246.5 254.5 261.7  (1.7)% Total Fixed Deposits 321.0 325.8  (1.5)% 32

  31. Slide 31: LDR and CASA Ratio

    LDR and CASA Ratio Malaysia Group LDR CASA CASA (without IA) NSFR LCR 145.4% 145.8% 140.7% 142.1% 137.4% 118.1% 118.1% 117.6% 122.0% 88.5% 89.9% 91.7% 90.0% 116.8% 87.6% 91.6% 90.7% 92.3% 93.0% 91.7% 45.1% 44.1% 43.8% 45.4% 42.7% 40.9% 39.1% 37.7% 38.6% 36.9% 37.8% 35.6% 34.2% 35.3% 33.7% 41.7% 38.7

  32. Slide 32: RWA Optimisation and Funding Management

    RWA Optimisation and Funding Management Group Gross Loans & Group RWA Funding Breakdown Operational RWA Market RWA Credit RWA Gross Loans Borrowings and Capital Instruments by Currency 640.8 FI Deposits, 5% 617.0 586.9 Equity, 10% RM, 440.9* 408.6 428.5* 31% SGD, 3% 50.3 Repo, 4% IDR, 6% 49.7 47.1 2

  33. Slide 33: Minimal Residual Exposure to Loans Under Relief; Manageable AQ Trends

    Minimal Residual Exposure to Loans Under Relief; Manageable AQ Trends % of Loans Under Repayment Assistance, Relief and R&R Programmes Against Respective Total Home Market Loans Malaysia Indonesia % of Outstanding Loan Balance^ 31/10/23 31/01/24 % of Outstanding Loan Balance^ 31/10//23 31/01//23 Mor

  34. Slide 34: Asset Quality

    Asset Quality Allowances for losses on loans GIL Ratio Composition P&L ECL 4Q FY2022 1Q 2Q 3Q 4Q Dec Mar Jun Sep Dec FY2022 FY2023 (RM million) (Restated) FY2023 FY2023 FY2023 FY2023 2022 2023 2023 2023 2023 Stage 1, net (212) (87) (73) (66) 59 (101) (167) Non Performing Loans 1.22% 1.25% 1.15% 1.06

  35. Slide 35: Asset Quality by Line of Business in Home Markets

    Asset Quality by Line of Business in Home Markets Consumer GIL Ratios Mortgage Auto Finance Credit Cards 0.99% 1.02% 5.58% 5.41% 5.30% 0.88% 0.82% 5.25% 5.05% 1.61% 0.69% 1.49% 1.32% 0.51% 1.22% 1.09% 0.44% 0.47% 1.29% 0.52% 0.51% 0.52% 0.32% 0.36% 1.21% 1.24% 1.17% 0.51% 0.51% 1.02% 0.58% 0.64% 0.6

  36. Slide 36: Specific Asset Exposures as at 31 December 2023

    Specific Asset Exposures as at 31 December 2023 Oil & Gas Loan and Fixed Income Securities Exposures Real Estate Loan Exposure to Non-Retail Borrowers to Non-Retail Malaysian Borrowers Country Exposure Borrowers’ Status 22.6% High Rise Residential RM29.2 billion 15.1% Landed Residential Malaysia 2.1

  37. Slide 37: Dividend: FY2023

    Dividend: FY2023 Full cash second interim dividend of 31 sen per share, bringing total dividend to 60.0 sen per share for FY2023 Dividend Policy 40% - 60% 79.9% 78.5% 78.1% 78.5% 87.8% 91.2% 84.5% 84.6% 77.4% Dividend 76.5% 74.9% 74.7% 71.9% 76.3% 77.3% Payout Ratio 100% 88% 100% 67% 53% 63% 27% 20%

  38. Slide 38: Overall Business and Financial Impact From Basel III Reform

    Overall Business and Financial Impact From Basel III Reform Implementation Approach and Impact: Business Perspective • May have impact on pricing and business product strategies, especially arising • Basel III Reform encompasses changes to credit, market, from capital floor requirement, CVA and Mark

  39. Slide 39: Overall Business and Financial Impact from the Adoption of MFRS 17

    Overall Business and Financial Impact from the Adoption of MFRS 17 Business Perspective Maybank is in compliance with MFRS 17 requirements for • Not expected to have a notable impact on pricing and product strategies 12M FY2023 reporting. As Etiqa has opted to use the various approaches to transitio

  40. Slide 40: Income Statement for Insurance and Takaful Business

    Income Statement for Insurance and Takaful Business 4Q FY2022 RM million FY2023 YoY 4Q FY2023 3Q FY2023 2Q FY2023 1Q FY2023 QoQ FY2022 YoY (Restated) (Restated) Net interest income 1,718.7 1,482.9 15.9% 436.4 442.8 428.7 410.7 (1.4)% 405.1 7.7% Insurance/takaful service result 318.2 (77.3) (>100)% 2

  41. Slide 41: Key Operating Ratios

    Key Operating Ratios 4Q FY2022 4Q 3Q 2Q 1Q % FY2023 YoY QoQ FY2022 YoY (Restated) FY2023 FY2023 FY2023 FY2023 (Restated) 3 Return on Equity 10.8 9.6 1.2% 11.0 10.9 0.1% 11.1 10.8 10.5 0.5% 3 Net Interest Margin (bps) 2.12 2.39 (27) bps 2.06 2.10 (4) bps 2.14 2.19 2.39 (33) bps Fee to Income Ratio 29

  42. Slide 42: Table of Contents

    Table of Contents Executive Summary 2-10 FY2023 Financial Performance 12-18 Appendix: 1. Group Performance 20-40 2. Business/Country Performance 42-50

  43. Slide 43: Market Share Overview for Community Financial Services Malaysia

    Market Share Overview for Community Financial Services Malaysia Market share Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Loans Total consumer 18.7% 18.7% 18.6% 18.7% 18.9% Auto (Retail Hire Purchase) 30.4% 30.2% 30.2% 30.1% 30.1% Total mortgage * 14.8% 14.8% 14.9% 15.1% 15.3% Credit cards ** 21.1% 21.0% 21.2

  44. Slide 44: Leadership in Mobile & Internet Banking with strong growth in digital payments

    We maintained our leadership position in Mobile & Internet Banking with strong growth in digital payments As at Dec’ 23 As at Dec’ 23 As at end- Dec’ 23 in Malaysia SME Digital Financing approved loans since Mobile Banking Internet Banking RM3.88 bil its launch in Sep’20 3-month Active Users Market

  45. Slide 45: Overview: Group Wealth Management & Group Securities Portfolios

    Overview: Group Wealth Management & Group Securities Portfolios Group Wealth Management Group Securities Portfolio Total Financial Assets grew 10.9% YoY to RM469.2 billion contributed by Group Securities Portfolio¹ grew 15.1% YoY investments growth of 15.4% and loans growth of 9.2%  +15.1% YoY  +1

  46. Slide 46: Overview of Group Investment Banking Portfolio

    Overview of Group Investment Banking1 Portfolio FY2023 Total Income Breakdown by Country FY2023 Non-Interest Income for Malaysia Vietnam Hong Kong Others Others 8% 3% 0% 16% Arranger and Phillipines upfront fees 1% 18% Underwriting Indonesia commission Malaysia 7% 7% 39% Placement and RM286.6 RM1,22

  47. Slide 47: Islamic Banking: Performance Overview

    Islamic Banking: Performance Overview Group Islamic Banking Financial Performance Maybank Islamic: Total Gross Financing1 grew to RM266.6 billion +16.2% Dec 22 FY2022 Dec 23 RM million FY2023 YoY (Restated) +10.1% +0.9% Total Income 7,510.7 7,660.9 (2.0%) 50.3 86.1 74.1 +7.0% Profit Before Tax 3

  48. Slide 48: Islamic Banking: Market Share

    Islamic Banking: Market Share Maybank Islamic Market Share1 Market Share by Key Products (Malaysia)1 29.6% 30.0% 29.5% 29.4% 29.3% 47.2% 26.5% 27.3% Automobile Term Financing Home 27.8% Financing 27.1% Dec 23 Dec 23 Dec 23 26.7% 26.1% 26.0% Dec 22 Mar 23 Jun 23 Sep 23 Dec 23 Dec 22: 48.3% Dec 22: 25

  49. Slide 49: Insurance and Takaful: Performance Overview

    Insurance and Takaful: Performance Overview Net Adjusted Premium/Contribution Life & Family (New Business) Market Share (Malaysia) Single Premium  (54.9)% 19.2% 19.7% 18.7% 19.4% Regular Premium  12.7% Credit Premium  18.9% 18.0% 15.5% 17.6% 18.1% No. 3 10.9% 12.0% 12.2% 11.9% in Life/Family Grou

  50. Slide 50: Maybank Singapore: P&L Summary

    Maybank Singapore: P&L Summary FY2022 SGD million FY2023 YoY 4Q FY2023 3Q FY2023 QoQ (Restated) Net fund based income 753.59 807.60 (6.7)% 179.02 177.45 0.9% Non-interest income 370.44 406.81 (8.9)% 86.17 120.50 (28.5)% Net income 1,124.03 1,214.41 (7.4)% 265.19 297.95 (11.0)% Overhead expenses (540

  51. Slide 51: Maybank Indonesia: P&L Summary and Financial Ratios

    Maybank Indonesia: P&L Summary and Financial Ratios 4Q 3Q IDR billion FY2023 FY2022 YoY QoQ Key Operating Ratios Dec 23 Sep 23 Dec 22 YoY FY2023 FY2023 Net Fund Based income 7,234 6,978 3.7% 1,825 1,800 1.4% Profitability & Efficiency Non-Interest income 2,035 1,760 15.6% 604 336 79.9% ROA 1.41% 1.3

  52. Slide 52: Malayan Banking Berhad contact details

    MALAYAN BANKING BERHAD 14th Floor, Menara Maybank 100, Jalan Tun Perak 50050 Kuala Lumpur, Malaysia Tel : (6)03-2070 8833 www.maybank.com Disclaimer. This presentation has been prepared by Malayan Banking Berhad (the “Company”) for information purposes only and does not purport to contain all the in

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