First Abu Dhabi Bank · ADX:FAB
First Abu Dhabi Bank — Q3 2023 Earnings Presentation
27 slides from First Abu Dhabi Bank's earnings presentation, Oct 19, 2023
Slide 1: Q3/9M'23 Earnings Presentation
Strategic Pathway Partner Q3/9M’23 EARNINGS PRESENTATION 19 October 2023
Slide 2: Disclaimer
Disclaimer • Comparative figures have been reclassified where appropriate to conform to the presentation and accounting policies adopted in the consolidated financial statements • Integration of Bank Audi Egypt into FABMisr was completed in Q4’22. FABMisr is grouped under Head Office on an interim b
Slide 3: Record 9M'23 performance with Group Net Profit +58% yoy on an underlying basis
Record 9M’23 performance with Group Net Profit +58% yoy on an underlying basis Operating Income Net Profit KEY HIGHLIGHTS 9M’23 20.5 ▲ +38% YoY 9M’23 12.4 ▲ +58% AED Bn YoY Record profitability driven by strong business volumes, revenue expansion and continued cost and risk discipline AED Bn Q
Slide 4: Record 9M'23 NPAT driven by core revenue momentum
Record 9M’23 NPAT driven by core revenue momentum Net profit bridge (AED Mn) +58% YoY1 (+AED 4.5Bn) Operating Income 5,610Mn +2243 10,949 (521) (346) (203) 12,395 3,094 +3367 7,855 9M'22 NPAT Net interest income Non-interest income Operating Costs Impairment charges,net Taxes & Minority Interest 9M'
Slide 5: Q3'23 NPAT is the highest ever achieved on an underlying basis
Q3’23 NPAT is the highest ever achieved on an underlying basis Q3’23 Net profit bridge (AED Mn) Year on year Quarter on quarter +46% YoY +1% QoQ (+AED 1.3Bn) (+AED 44Mn) +536 +8 +70 +89 +135 +946 (205) (33) (75) (95) 4,255 4,211 4,255 2,923 Q3'22 NPAT Net interest Non-interest Operating Costs Impair
Slide 6: Broad-based and diversified revenue growth across all business lines
Broad-based and diversified revenue growth across all business lines 9M’23 operating income BS trends (AED Bn) Revenue breakdown by business Sep'23 Dec'22 14% Investment Banking Investment Banking 8.8 +45% YoY Loans 213 ↑4% 9M'23 AED 20.5Bn 25% 19% 4% Corporate & Commercial AED Bn 23% Banking Dep
Slide 7: Balance sheet fundamentals remain robust, underpinned by a very strong liquidity position
Balance sheet fundamentals remain robust, underpinned by a very strong liquidity position Loans (gross) increased 4% ytd (+AED 20Bn) driven by sustained demand from our core clients across the Asset Mix – Dec’22 +7% Ytd Asset Mix – Sep’23 corporate & private sectors, and growth in trade finance acti
Slide 8: Volume growth and rate hike benefits, support double-digit NII expansion
Volume growth and rate hike benefits, support double-digit NII expansion QoQ ↑8bps, YoY ↑28bps YoY ↑20bps Performing loan yields (%) Quarterly Ytd 1.76 1.81 1.74 1.73 1.67 1.56 6.12 6.28 5.72 Net interest 1.53 5.04 6.04 margin3 QoQ ↑3%, YoY ↑26% YoY ↑34% 4.19 5.72 5.92 3.47 3.89 13.4 Q3'22 Q4'22 Q1'
Slide 9: Strong NFI momentum reflects benefits from diversified franchise
Strong NFI momentum reflects benefits from diversified franchise Non-interest income trend (AED Mn) Non-interest income % of Group operating income Non-interest income 9M’23 YoY% Q3’23 QoQ% YoY% (In AED Mn) QoQ ↑0%, YoY ↑29% YoY ↑46% Fees & commissions, net 2,267 8% 718 -6% 15% 35% FX and
Slide 10: Outstanding operating efficiency amid ongoing investments to drive business growth
Outstanding operating efficiency amid ongoing investments to drive business growth Opex drivers YoY (AED Mn) Opex trend (AED Mn) and C/I ratio1 (%) 33.4 +11% YoY 28.7 25.9 25.1 25.3 30.9 25.4 QoQ ↑4%, YoY ↑13% YoY ↑11% +121 +112 +288 5,226 5,226 4,705 4,705 2,000 1,688 1,732 1,806 1,601 Q3
Slide 11: Asset quality metrics remained strong with adequate provision buffers
Asset quality metrics remained strong with adequate provision buffers Impairment charges, net (AED Mn) & CoR1 (%) NPLs2 and ECLs3 (%) Net impairment charges CoR (L&A) (bps) Provision Coverage (%) NPL Ratio (%) NPLs (AED Bn) Provisions (AED Bn) 103 98 101 103 97 86 60 62 57 3.9 55 52 52 3.9 3.8 3.7 3
Slide 12: Record profitability drives solid capital accretion year-to-date
Record profitability drives solid capital accretion year-to-date CET11 ratio progression CET1, Tier 1 and CAR trends (%) 17.2% 16.6% 16.1% 16.2% 16.1% +160bps Ytd 15.6% 15.5% 15.0% 15.1% 14.5% 14.2% 13.6% +73bps -9bps -4bps 13.1% 13.2% 14.2% 12.6% Cash DPS: 52 fils 1.0% 13.6% • RWA AED 5.75Bn optimi
Slide 13: Reiterating FY'23 financial guidance
Reiterating FY’23 financial guidance 2023e financial guidance 9M’23 actual • Cautiously optimistic in light of global uncertainties and the higher-for-longer interest rate environment Loan growth Mid single-digit +4% ytd • Recent economic developments further bolstering the region’s role as a strate
Slide 14: FAB is leading at COP28 as the region's sustainable banking leader
FAB is leading at COP28 as the region's sustainable banking leader Strategic Pathway Partner of COP28 FAB’s 6-point COP28 agenda • Accelerating sustainable finance and advancing the UAE’s development as a green finance hub, • Supporting its clients and partners with the transition to net zero, FAB l
Slide 15: Appendix
Appendix doll abo Bo Fist Abu Dhabi Bank 15
Slide 16: A well-diversified, high quality loan book
A well-diversified, high quality loan book Gross loans trend Figures in AED Bn Gross loans by counterparty QoQ ↓1%, YoY ↑3%, Ytd ↑4% 480 500 Trade-related 16% 16% 484 480 494 504 500 Personal/ Retail Corporate/ Private 52% 52% Banks 1% 4% 38 43 50 48 Public Sector 34 19% 17% Government 12% 11% Sep'2
Slide 17: Healthy asset quality and adequate provision buffers
Healthy asset quality and adequate provision buffers Loans by stage ECL2 by stage (AED Bn) (AED Bn) AED 492.5Bn AED 18.6Bn (Gross loans net of IIS) as of Sep’23 as of Sep’23 Ratio % of gross loans Sep'23 Dec'22 (net of IIS)1 Sep'23 460.5 93.5% 1.9 Dec'22 Stage 1 Stage 1 441.6 1.7 12.8 2.6% 5.1 A
Slide 18: High-quality and diversified investment portfolio
High-quality and diversified investment portfolio Investments by type Investments by ratings Sep'23 Dec’22 Sep'23 Sep'23 Dec’22 AED 215Bn AAA 11% 24% Sep'23 FVTPL - Debt 18% 14% AED 215Bn AA 38% 23% Dec'22 FVTPL - Equity & Funds 2% 2% AED 205.7Bn A 25% 26% Amortised Cost (Debt Inv) 2% 2% BBB 6% 7% D
Slide 19: Customer deposits +12% ytd with continued growth in CASA balances
Customer deposits +12% ytd with continued growth in CASA balances Customer deposits trend Customer deposits by counterparty AED Bn AED Bn QoQ ↑5%, YoY ↑5%, Ytd ↑12% 701 785 Total Customer Deposits CASA Certificates of deposits 5% 4% 781 785 14% 15% 746 745 701 Personal/retail sector 36% 45% C
Slide 20: Leading issuer in the MENA region
Leading issuer in the MENA region Liability mix Medium-term wholesale funding Customer Term Borrowings & Sub Issuances1 Maturities1 (AED Mn) Deposits, Debt, 6% 74% Others, 10% 18,631 USD AED 1,066Bn 17,274 Sep'23 Due to Banks & 16,152 15,798 CNH Repos, 9% 13,268 12,595 10,648 11,059 GBP Commercial P
Slide 21: Diversified franchise by business segment and geography
Diversified franchise by business segment and geography Breakdown by Business Breakdown by Geography Investment Banking Corporate & Commercial Banking Consumer Banking Global Private Banking UAE International Head Office3 Operating Income Profit after taxes Operating Income Profit after taxes 9M'23
Slide 22: Business segments overview – IB & CCB
Business segments overview – IB & CCB Investment Banking (IB) AED Mn 9M’23 YoY% Key highlights Quarterly operating income trend (AED Bn) Loans & Deposits (AED Bn) Operating Income 8,779 45 • IB revenue grew 45% yoy to a record AED 8.8 billion Loans: QoQ ↓1%, Ytd ↑4% contributing 43% to the Gr
Slide 23: Business segments overview – CB & GPB
Business segments overview – CB & GPB Consumer Banking (CB) Key highlights AED Mn 9M’23 YoY% Quarterly operating income trend (AED Bn) Loans & Deposits (AED Bn) Operating Income 2,842 2 • CB revenue grew 2% yoy to AED 2.8 billion Loans: QoQ ↑3%, Ytd ↑6% QoQ ↓11%, YoY ↑3% YoY ↑2% Depo
Slide 24: International – financial overview
International – financial overview International (AED Mn) 9M’23 YoY% Key highlights Quarterly operating income trend (AED Bn) Operating Income 3,951 32 • Operating income from international operations grew QoQ ↑8% , YoY ↑25% YoY ↑32% 32% yoy to AED 4.0 billion, contributing 19% to the Group’
Slide 25: Q3/9M'23 financial highlights – Group financials
Q3/9M’23 financial highlights – Group financials Income Statement - Summary (AED Mn) Q3’23 Q2’23 QoQ % Q3’22 YoY % 9M’23 9M’22 YoY % Net interest Income 4,577 4,441 3 3,631 26 13,409 10,042 34 Non- interest Income 2,399 2,391 0 1,863 29 7,129 4,886 46 Operating Income 6,976 6,833 2 5,494 27
Slide 26: Q3/9M'23 financial highlights – Segmental
Q3/9M’23 financial highlights – Segmental 9M’23 AED Mn Q3’23 Q2’23 QoQ % Q3’22 YoY % 9M’23 9M’22 YoY % Contr% Operating income 6,976 6,833 2 5,494 27 20,538 14,929 38 100% Investment banking (IB) 3,191 2,933 9 2,243 42 8,779 6,050 45 43% Corporate & Commercial banking (CCB) 1,729 1,782 (3) 1,268
Slide 27: For more information, please visit www.bankfab.com or contact FAB Investor Relations
For more information, please visit www.bankfab.com or contact FAB Investor Relations team at ir@bankfab.com You can also download FAB’s Investor Relations App from App Store /Google Play to access latest corporate updates Scan to download this presentation Click on the image to access latest reports