Slide 1: Performance Highlights – 9M'2017
Performance Highlights – 9M’ 2017 | Investor Relations Conference Call October 23rd, 2017 Speakers: Mr. Aameer Karachiwalla - Chief Financial Officer Mr. Arif Saifie, CFA - Financial Controller and Head of Investor Relations “Best Bank for Corporate Finance and Capital Market Development” UBL Perfor
Slide 2: Table of Contents
Table of Contents PAGE Key Highlights 3 Execution and Delivery 7 Key Ratios 24 Quarterly Trend Analysis 26 UBL Performance Overview – 9M’17
Slide 3: Key Performance Highlights
Key Performance Highlights Standalone Results Profit before tax closes at Rs. 31.4 bln (9M’16: Rs. 35.6 bln) Profit after tax closes at Rs. 19.1 bln (9M’16: Rs. 21.3 bln) Return on equity (RoE) of 21.3% in 9M’17 (9M’16: 25.9%) Average balance sheet expansion of 15% in 9M’17 vs 9M’16 Deposi
Slide 4: Strong growth in balance sheet maintains NII despite repricing impact
Strong growth in balance sheet maintains NII despite repricing impact Net interest income 2% lower than 9M’16, closes at Rs. 42.2 bln Overall cost of deposits reduced to close at 2.6% in 9M’17 (9M’16: 2.7%) Domestic cost of deposits at 2.75% in 9M’17 (9M’16: 2.88%) International cost of deposi
Slide 5: Recoveries within domestic book, prudent classification within International
Recoveries within domestic book, prudent classification within International Net provision charge of Rs. 0.12 bln in 9M’17 vs Rs. 1.40 bln in 9M’16 Strong cash recoveries within domestic operations Overall NPLs closed at Rs. 47.5 bln at Sep’17 (Dec’16: Rs. 44.6 bln) Asset quality at 7.8% at Se
Slide 6: 22% growth in balance sheet size over Dec'16
22% growth in balance sheet size over Dec’16 Growth in core deposits drives balance sheet expansion The Bank’s domestic deposits closed at Rs. 1.01 trillion at Sep’17 end (Dec’16: Rs. 946 billion) Domestic current account portfolio grew by 12% over Dec’16, with average current account growing by
Slide 7: Execution and Delivery
Execution and Delivery UBL Performance Overview – 9M’17 7
Slide 8: Consistent earnings performance throughout the years
Consistent earnings performance throughout the years Trends - KSE 100 Index and UBL’s share price Equity and Book Values 300 Max 9M'17:Rs. 275.38 30 Sep’17: Rs. 190.17 55.00 Rs in bln Cons . Equity Sep’17 - Rs. 166 bln 280 20 Oct'17: Rs. 193.69 Cons . Book value Sep’17 - Rs. 136 per s hare 50.00 260
Slide 9: Income Statement - Standalone
Income Statement - Standalone Rs in bln Rs in bln 9M'17 9M'16 Var % Q3'17 Q2'17 Var % Interest Earned 78.2 73.4 6.5% 28.5 25.8 10.4% Interest Expensed (36.0) (30.4) -18.5% (14.3) (11.5) -24.5% Net Interest Income 42.2 43.0 -1.9% 14.2 14.3 -0.9% Non Interest Income 16.1 18.4 -12.5% 3.8 6.1 -37.9% Tot
Slide 10: Balance Sheet - Standalone
Balance Sheet - Standalone Rs in bln Sep'17 Dec'16 Var % Advances 567 510 11.1% Investments 1,090 807 35.2% Lendings to Financial Institutions 41 34 19.7% Others 224 227 -1.0% Total Assets 1,922 1,578 21.9% Deposits 1,254 1,180 6.3% Borrowings 470 202 133.2% Others 46 44 4.3% Total Liabilities 1,770
Slide 11: Income Statement - Consolidated
Income Statement - Consolidated Rs in bln Rs in bln 9M'17 9M'16 Var % Q3'17 Q2'17 Var % Interest Earned 80.6 75.9 6.2% 29.3 26.6 10.1% Interest Expensed (37.2) (31.5) -18.3% (14.8) (11.9) -23.9% Net Interest Income 43.4 44.4 -2.3% 14.6 14.7 -1.1% Non Interest Income 18.3 20.4 -10.4% 4.7 6.4 -26.6% T
Slide 12: Balance Sheet - Consolidated
Balance Sheet - Consolidated Rs in bln Sep'17 Dec'16 Var % Advances 600 538 11.6% Investments 1,122 838 33.9% Lendings to Financial Institutions 42 35 18.8% Others 255 250 1.8% Total Assets 2,020 1,662 21.5% Deposits 1,329 1,246 6.7% Borrowings 476 206 131.3% Others 48 46 3.2% Total Liabilities 1,85
Slide 13: Deposits performance - Focus remains on growing low cost deposits
Deposits performance - Focus remains on growing low cost deposits Deposits - Bank Sep'17 Dec'16 PE CoF % PE CoF % Domestic deposits - Rs in bln 1,009 2.7% 946 2.9% International deposits - Rs in bln 244 2.2% 234 2.0% Total Bank - Rs in bln 1,254 2.6% 1,180 2.7% International - USD in mln 2,319 2.2%
Slide 14: Advances portfolio up 11% over Dec'16
Advances portfolio up 11% over Dec’16 Net Advances Rs in bln Sep'17 Dec'16 Var % Corporate Bank 283 236 20% Commodity 51 53 -4% Commercial 28 28 2% Consumer 11 9 14% Others 20 15 33% Total Domestic 393 342 15% International 173 168 3% Bank 567 510 11% International USD mln 1,643 1,608 2% Dec'16 236
Slide 15: International Advances - Corporate advances remains the largest component
International Advances - Corporate advances remains the largest component By Geography By Business - UAE Bahrain, Qatar, 12% Yemen, 0% 14% NewYork, 3% EPZ, 0% Corporate, 66% Others, 30% UAE, 71% Consumer, 4% Personal Others, 2% loan, 2% Abu Dhabi, 25% Sharjah, 3% Dubai, 72% Baitna, 96% UBL Performan
Slide 16: Concentration of Advances as at September 30, 2017 - Standalone
Concentration of Advances as at September 30, 2017 - Standalone 2% 11% 33% 11% 1% 1% 3% 8% 7% 2% 21% Chemical & Pharma Agribusiness Textile Cement Sugar Autos & Transport Financial Electronics Power & Energy Individuals Others UBL Performance Overview – 9M’17 16
Slide 17: Diversified investment portfolio with strong market risk management
Diversified investment portfolio with strong market risk management Portfolio concentrated in long terms treasury bonds Investments’ yields Total 1,090 11.1% Rs in bln 38 2 45 37 18 10.4% Total 807 10.4% 43 5 36 8.9% 29 548 16 7.9% 2013 2014 2015 2016 9M'17 571 Non Funded revenue streams continue to
Slide 18: Our international outreach - serving in 4 continents under the single UBL brand
Our international outreach - serving in 4 continents under the single “UBL” brand ASSOCIATED COMPANIES 3 OVERSEAS BRANCHES 18 PAKISTAN BRANCHES 1,347 SUBSIDIARIES 4 Asset mix by region - 2016 Domestic Operations 76.4% International Operations 23.6% Middle East 17.5% USA 0.7% Europe 5.0% Africa 0.3%
Slide 19: UBL Innovation and Awards
UBL Innovation and Awards UBL “Firsts” – Initiatives to stay ahead of the market Market recognition and awards First Commercial Bank in Pakistan to launch Branchless Awarded “Innovation Award” at the Mastercard Innovation Forum for Banking (UBL OMNI) ‘Launch of UBL MasterPass QR’ Declared the
Slide 20: Review of Non Interest Income & Administrative Expenses
Review of Non Interest Income & Administrative Expenses UBL Performance Overview – 9M’17 20
Slide 21: Non Fund Income Standalone Results
Non Fund Income Standalone Results Rs in mln 9M'17 9M'16 Var % Fee, commission and brokerage income 8,763 9,145 -4% Dividend income 1,544 2,027 -24% Income from dealing in foreign currencies 1,323 1,394 -5% Gain / (loss) on sale of securities 3,824 5,156 -26% Other income 661 696 -5% Total Non Fund
Slide 22: Fees and Commissions performance Standalone Results
Fees and Commissions performance Standalone Results Rs in mln 9M'17 9M'16 Var % Commission on trade 1,399 1,526 -8% Commission on consumer loan 568 547 4% Commission on remittance / uniremote 1,284 1,629 -21% Corporate service chgs/finance fee/FIG inc. 1,106 1,376 -20% General banking service charge
Slide 23: Administrative Expenses Standalone Results
Administrative Expenses Standalone Results Rs in mln 9M'17 9M'16 Var % Personnel Cost 10,571 9,322 -13% Rent taxes insurance etc. 3,388 3,057 -11% Outsourced service charges 3,433 3,586 4% including sales commission Advertisement and publicity 651 367 -78% Communications 938 846 -11% Depreciation /
Slide 24: Key Ratios
Key Ratios UBL Performance Overview – 9M’17 24
Slide 25: Key Financial Ratios Standalone Results
Key Financial Ratios Standalone Results 9M'17 9M'16 Q3'17 Q2'17 Return on Equity 21.3% 25.9% 19.0% 19.9% Return on Assets 1.5% 1.9% 1.2% 1.4% Non Fund Income to Gross Revenue 27.6% 30.0% 21.0% 29.8% Cost to Revenue Ratio 44.8% 38.5% 49.0% 43.2% Sep'17 Jun'17 Dec'16 Sep'16 Advances to Deposits Ratio
Slide 26: Quarterly Trend Analysis
Quarterly Trend Analysis Bank Level - Standalone UBL Performance Overview – 9M’17 26
Slide 27: Profit before tax
Profit before tax Rs in bln 13.5 +6% +7% 11.2 11.8 10.9 11.2 11.3 10.8 10.2 9.9 10.4 -29% 9.3 8.4 8.3 8.4 7.8 8.0 7.1 6.4 5.9 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 UBL Performance Overview – 9M’17 27
Slide 28: Profit after tax
Profit after tax Rs in bln 7.3 7.3 7.1 7.0 +13% 6.5 6.5 6.4 -17% 7.0 6.1 6.0 5.7 5.6 5.2 5.3 5.3 -10% 5.9 4.7 4.3 4.0 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 UBL Performance Overview – 9M’17 28
Slide 29: Deposits
Deposits Rs in bln -0% +6% +0% 1,256 1,254 1,180 1,183 1,142 1,147 1,051 1,070 992 994 945 895 847 858 866 828 752 773 703 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 UBL Performance Overview – 9M’17 29
Slide 30: Net Advances
Net Advances Rs in bln +0% 565 567 +13% 509 510 496 498 -2% 459 455 434 430 417 420 447 408 391 377 363 369 352 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 UBL Performance Overview – 9M’17 30
Slide 31: Revenue
Revenue Rs in bln 21.9 21.3 +2% 20.3 +4% 20.4 20.0 19.3 19.5 19.2 -12% 17.6 18.6 18.1 17.9 16.3 15.4 14.9 13.8 14.1 15.5 12.6 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 UBL Performance Overview – 9M’17 31
Slide 32: Net Interest Income
Net Interest Income Rs in bln 15.7 14.7 14.2 14.3 -1% 14.0 +4% 13.6 13.1 14.2 12.8 13.9 -2% 13.7 13.7 11.3 11.0 10.6 9.8 9.5 9.0 8.8 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 UBL Performance Overview – 9M’17 32
Slide 33: Non Funded Income
Non Funded Income Rs in bln 8.4 6.2 6.2 6.3 -3% +21% 6.1 5.6 4.9 5.1 5.0 4.8 4.8 4.8 4.8 4.6 5.2 -38% 4.5 3.9 4.5 3.8 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 UBL Performance Overview – 9M’17 33
Slide 34: Provisions
Provisions Rs in bln 2.0 1.3 0.9 0.9 0.8 0.7 0.5 0.6 -76% 0.8 0.3 0.3 0.2 0.2 0.1 -777% +207% -0.1 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 -0.1 -0.3 -0.3 -0.5 UBL Performance Overview – 9M’17 34
Slide 35: Administrative Expenses
Administrative Expenses Rs in bln -0% +3% 8.8 8.8 8.6 +3% 8.5 8.4 8.2 8.0 7.8 7.6 7.3 7.4 7.4 7.2 7.1 6.9 6.9 6.5 6.5 6.2 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 UBL Performance Overview – 9M’17 35
Slide 36: Important Information
Important Information The information contained herein reflects our latest business statement as at September 30, 2017. Except the historical information contained herein, statements in this Release which contain words or phrases such as ‘will’, ‘would’, ‘indicating’ expected to’ etc., and similar e
Slide 37: Thank You
Thank You UBL Performance Overview – 9M’17 37