Public Bank Bhd · MYX:PBBANK
Public Bank Bhd — 3Q 2007 Earnings Presentation
29 slides from Public Bank Bhd's earnings presentation, September 2007
Slide 1: Group Unaudited Financial Results for the Period Ended 30 Sept 2007
Group Unaudited Financial Results for the Period Ended 30 Sept 2007
Slide 2: 24% Growth in Pre-Tax Profit to RM2.18 billion
24% Growth in Pre-Tax Profit to RM2.18 billion RM million Sen 2500 65 2,182.4 60 2000 1,767.1 55 1,510.2 1,544.0 50 1500 1,281.6 45 1,066.4 46.0 40 1000 38.7 35 500 32.6 30 25 0 20 Sep 05 Sep 06 Sep 07 PBT PAT EPS 2
Slide 3: Quarterly Net Profit
Quarterly Net Profit RM million 550 500 450 445 476 524 544 400 436 7% 10% 4% 2% 350 300 'Sep 06 'Dec 06 'Mar 07 'Jun 07 'Sep 07 3
Slide 4: Financial Performance – Net profit up 20% to RM1.5b
Financial Performance – Net profit up 20% to RM1.5b 3Q07 2Q07 % YTD Sep 07 YTD Sep 06 % RM mil RM mil q-o-q RM mil RM mil y-o-y Net Interest Income 825.8 783.8 5 2,372.2 2,118.8 12 Islamic Banking Income 126.2 119.3 6 351.0 316.0 11 Other Operating Income 361.1 349.4 3 999.8 708.6 41 Other Operating
Slide 5: Quarterly Growth vs Preceding Quarter
Quarterly Growth vs Preceding Quarter 3Q07 2Q07 1Q07 4Q06 % q-o-q q-o-q q-o-q q-o-q Net Interest Income (include 5 4 1 2 IB income) Other Operating Income 3 21 9 8 Other Operating Expenses (1) 10 4 5 Operating Profit 8 7 2 2 Loan Loss Allowances 24 3 (18) (17) Pre-Tax Profit 6 8 4 7 Net Profit 4 10
Slide 6: Key Financial Ratios
Key Financial Ratios % % Sep 2007 Sep 2006 y-o-y 3Q07 2Q07 q-o-q Cost Income Ratio (%) 33.2 32.6 2 32.2 34.0 (5) Return on Assets (%) 1.9 1.9 0 1.9 1.8 3 Net Return on Equity* (%) 24.4 21.0 16 25.2 24.6 2 Overheads / Avg. Assets (%) 1.1 1.1 (3) 1.0 1.1 (3) Net Interest Margin on 3.2 3.4 (5) 3.2 3.1
Slide 7: Net Interest Margin
Net Interest Margin 4.0% 3.7 3.6 3.5 3.4 3.4 3.5% 3.2 3.2 3.0% 3.3 2.5% 3.0 2.9 2.8 2.6 2.0% 2.4 2.4 Dec-04 Jun-05 Dec-05 Jun-06 Dec-06 Jun-07 Sep-07 Net Int Margin Net Int Margin (excl. funds from NIDs and MMDs Issued) Net interest income and financing income grew by RM288 m or 12% due to : • str
Slide 8: PBT of Major Group Companies
PBT of Major Group Companies Variance (excluding dividend from subsidiaries) Sep 2007 Sep 2006 RM mil % RM mil RM mil Public Bank 1,742.9 1,422.6 320.3 23 Overseas Operations 278.1 240.7 37.4 16 Public Mutual 115.1 67.1 48.0 72 Public Investment Bank 57.3 21.6 35.7 165 Public Bank (L) 21.2 10.0 11.2
Slide 9: Profit Contribution By Segments
Profit Contribution By Segments Sep 2007 Sep 2006 Variance RM mil % RM mil % % Retail Operations 1,688.5 73 1,327.2 72 27 Treasury & Capital Market 311.6 14 383.7 21 (19) Operations Fund Management 115.1 5 67.1 4 72 Investment Banking 92.9 4 23.5 1 295 Corporate Lending 84.2 4 27.2 2 210 Others 11.2
Slide 10: Fund Management Business
Fund Management Business RM billion % # 30.00 36.4 40 33.5 24.54 27.9 28.9 27.6 30 26.3 20.00 16.19 12.08 20 9.88 * 10.00 8.23 8.39 5.80 10 4.10 2.36 3.07 2.06 1.10 0.00 0 2002 2003 2004 2005 2006 ' Sep 07 Gross New Sales Net Asset Value Market Share (%) # as at August 2007 * 9 months 10
Slide 11: Other Operating Income
Other Operating Income Sep 2007 Sep 2006 % 3Q07 2Q07 % RM mil RM mil y-o-y RM mil RM mil q-o-q Fee Income 723.5 489.9 48 258.4 242.5 7 Non Fee Income 276.3 218.7 26 102.7 106.9 (4) Total 999.8 708.6 41 361.1 349.4 3 Included in fee income are: Fund Management Income Sep 2007 Sep 2006 % 3Q07 2Q07 % R
Slide 12: Other Operating Expenses
Other Operating Expenses Sep 2007 Sep 2006 % 3Q07 2Q07 % RM mil RM mil y-o-y RM mil RM mil q-o-q Personnel Costs 702.5 598.1 17 238.5 249.6 (4) Establishment Costs 234.6 216.3 8 78.3 78.8 (1) Marketing Expenses 194.4 97.4 100 71.7 59.4 21 Administration 104.0 113.8 (9) 33.9 37.7 (10) Expenses Total
Slide 13: Loan Loss Allowances
Loan Loss Allowances RM million 308.6 0.8% 300.0 261.4 0.72% 201.9 221.3 200.0 150.8 0.4% 0.39% 0.35% 0.34% 100.0 * 0.22% 0.0 0.0% 2003 2004 2005 2006 Sep 2007 Credit Charge Credit Charge off % * annualised 13
Slide 14: Summary of Balance Sheet
Summary of Balance Sheet Sep 2007 Dec 2006 Variance RM bil RM bil RM bil % Total Assets 165.6 147.8 17.8 12.1 Gross Loans and Advances: - excluding Islamic financing sold to Cagamas 96.2 84.4 11.8 14.0 - including Islamic financing sold to Cagamas 96.4 84.4 12.0 14.3 Domestic Gross Loans and Advance
Slide 15: Loan Growth, Loan Mix & Asset Quality
LOAN GROWTH, LOAN MIX & ASSET QUALITY
Slide 16: Annualised Loans Growth of 19%
Annualised Loans Growth of 19% Sep 2007 (%) (Annualised) PBB - excluding Islamic financing sold to Cagamas (14.0% in 9 months) 18.7 - including Islamic financing sold to Cagamas (14.3% in 9 months) 19.0 Industry Average* 11.5 *extrapolated based on 8 months loan growth in 2007 Market Share: Sep 2007
Slide 17: Loans Approved
Loans Approved RM billion 32 27.7 28 24 20.0 20 16 12 8.6 7.1 6.3 5.2 8 5.3 4.2 3.0 4 1.4 0 Total Vehicle SMEs Housing Corporate 2007 2006 Vehicle financing - RM0.8 b or 13% increase SMEs loans - RM3.3 b or 62% increase Housing loans - RM1.0 b or 24% increase Corporate loans - RM1.6 b or 114% increa
Slide 18: Loan by Purpose
Loan by Purpose Sep 2007 % of total Dec 2006 % of total Growth RM bil loans RM bil loans (%) Purchase of Landed 43.0 45 37.3 44 15 Properties - Residential 25.6 27 23.0 27 11 - Non-residential 17.4 18 14.3 17 22 Purchase of Transport 25.5 27 23.3 28 9 Vehicles Working Capital 16.2 17 13.5 16 20 Pers
Slide 19: Fixed Rate & Floating Rate Loans
Fixed Rate & Floating Rate Loans RM3.2b RM36.4b 3% 59% 38% RM56.8b Fixed Rate Floating Rate Initial fixed rate, thereafter floating rate Interest rate Impact: 1% hike in interest rate would result in a RM129m increase in the Group’s net interest income. Duration : Modified duration is 1.6 years.
Slide 20: Asset Quality
Asset Quality 3-months classification Sep 2007 Dec 2006 Gross NPL (RM mil) 1,516 1,578 Net NPL ratio (%) 1.3 1.6 Loan loss coverage (%) 111.8 99.9 GP ratio (%) 1.5 1.6 GP/Net NPL (%) 113.8 99.9 % 3 2 2.7 1 2.1 2.3 2.1 1.9 1.7 1.9 1.9 1.7 1.6 1.6 1.5 1.6 1.3 0 Dec'04 Jun'05 Dec'05 Jun'06 Dec'06 Jun '
Slide 21: NPL Ratio for Key Lending Sectors
NPL Ratio for Key Lending Sectors Key Lending Sectors Sep 2007 Gross NPL Dec 2006 Gross NPL RM mil % RM mil % Housing Loans 668 2.6 706 3.1 SME 314 1.7 318 1.8 Hire Purchase 243 1.0 248 1.1 21
Slide 22: Continued Growth in Core & Wholesale Deposits
CONTINUED GROWTH IN CORE & WHOLESALE DEPOSITS
Slide 23: Annualised Deposits Growth of 22.5%
Annualised Deposits Growth of 22.5% Sep 2007 (%) (Annualised) PBB (16.9% in 9 months) 22.5 Industry Average* 18.8 *extrapolated based on 8 months deposit growth in 2007 Market Share: Sep 2007 - 14.3% 2006 - 14.2% 2005 - 13.2% 2004 - 12.4% 23
Slide 24: Total Deposits Grew By 17%
Total Deposits Grew By 17% Sep 2007 Dec 2006 Growth RM bil RM bil RM bil (%) Demand Deposits 13.2 11.3 1.9 17 Savings Deposits 16.0 14.8 1.2 8 Fixed Deposits 63.0 53.4 9.6 18 Others 0.5 0.4 0.1 25 92.7 79.9 12.8 16 NIDs 17.7 31.9 (14.2) (45) Money Market Deposits 20.3 - 20.3 N/A Total 130.7 111.8 18
Slide 25: Capital Adequacy Ratio
Capital Adequacy Ratio Sep 2007 Dec 2006 Variance RM mil RM mil RM mil % - Equity Capital 6,374.7 6,176.2 198.5 3 - Hybrid Capital 1,124.9 1,089.9 35.0 3 Total Tier 1 Capital 7,499.6 7,266.1 233.5 3 - General Allowance 1,468.2 1,318.5 149.7 11 - Subordinated Notes 2,548.8 2,627.8 (79.0) (3) - Hybrid
Slide 26: Prospects for the 4th Quarter of 2007
Prospects for the 4th Quarter of 2007 To maintain earning growth momentum leveraging on: ¾ continued strong loans & deposits growth; ¾ continued growth in net interest income; ¾ stable NPL. To build on existing strengths (Strong brand, market positions, capital strength and asset quality). Loa
Slide 27: Prospects for the 4th Quarter of 2007 (cont.)
Prospects for the 4th Quarter of 2007 (cont.) Overseas Operations: Expansion of Branch Network Number of Branches as at May 06* Dec 06 Sep 07 Dec 07 Hong Kong/China: 53 56 65 71 Public Finance - Hong Kong 40 40 41 41 PB(HK) - Hong Kong 12 15 22 27 - China 1 1 2 3 Cambodia 5 5 8 10 Laos 1 1 1 3 * Dat
Slide 28: Overseas Operations: Loan Growth
Prospects for the 4th Quarter of 2007 (cont.) Overseas Operations: Loan Growth Variance Sep 2007 Dec 2006 Loan Growth HKD/USD HKD/USD HKD/USD % mil mil mil Public Bank (Hong Kong) (HKD) 15,038 10,226 4,812 47 Cambodian Public Bank (USD) 265 158 107 68 28
Slide 29: Thank you
Thank you