Emirates NBD Bank (P.J.S.C) · DFM:EMIRATESNBD
Emirates NBD Bank (P.J.S.C) — Emirates NBD — Investor Presentation (June 2010)
34 slides from Emirates NBD Bank (P.J.S.C)'s investor presentation, June 2010
Slide 1: Emirates NBD Investor Presentation
Emirates NBD Investor Presentation June 2010 1
Slide 2: Important Information
Important Information Disclaimer The material in this presentation is general background information about Emirates NBD's activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to
Slide 3: Investment Highlights
Investment Highlights Emirates NBD is the largest bank in the UAE and the GCC Diversified Business Model with Fully Fledged Financial Services Leading Banking Offering Strong Asset and Group in the UAE Profit Growth over and the GCC the Past 5 Years Solid 56% Dubai Capitalization Government Tier 1 =
Slide 4: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy and Outlook 4
Slide 5: UAE Economic Update
UAE Economic Update Highlights Real GDP Growth Forecasts (1) UAE was impacted by external shocks including weaker oil prices, a 2008 2009 2010 2011 credit squeeze, and declining world trade UAE 7.4% 0.0% 2.5% 4.5% UK 0.7% (4.5%) 0.5% 2.0% Now these channels are improving, with oil prices firmer,
Slide 6: Dubai Economic Update
Dubai Economic Update Highlights Dubai 2008 GDP breakdown Dubai is the 3rd largest centre for re-exports in the world which itself UAE GDP by Emirate (2008) represents 44% of GDP 100% = USD 254b Dubai GDP by Sector (2008) Oil has played a progressively diminishing role in Dubai’s economy as 100%
Slide 7: UAE Banking Market Update
UAE Banking Market Update Highlights UAE Banking Sector Growth (USD billion) UAE loan growth has outstripped deposit growth in recent years UAE Banking system liquidity tightened in 2008 due to outflow of 425 403 c. USD 50b of speculative capital and the Global credit/liquidity crisis following
Slide 8: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy and Outlook 8
Slide 9: Summary
Summary Largest financial institution (by asset size) in the GCC and the UAE Flagship bank for Dubai and the UAE Governments 56% owned by Dubai government Consistently profitable; the No.1 bank in the UAE by income and net profits Fully fledged, diversified financial services offering Ever increasin
Slide 10: Emirates NBD at a Glance
Emirates NBD at a Glance Largest Bank in UAE Largest Branch Network in the UAE No.1 Market share in UAE: Ras al-Khaimah (4) Dubai 91 – Assets c.18%; Loans c.21% Abu Dhabi 18 Umm al-Quwain (2) – Deposits c.18% Sharjah 12 Fujairah (3) Other Emirates 12 Ajman (3) No. 1 Retail market shares (estimat
Slide 11: Emirates NBD is the Largest Bank in the UAE and GCC by Assets
Emirates NBD is the Largest Bank in the UAE and GCC by Assets UAE Ranking by Assets (USD billion) UAE Ranking by Equity (USD billion) UAE Ranking by Profits (2) (USD million) (1) Emirates NBD 76.7 Emirates NBD 7.0 Emirates NBD 910 NBAD 53.6 First Gulf Bank 6.2 First Gulf Bank 901 ADCB 43.6 NBAD 5.6
Slide 12: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy and Outlook 12
Slide 13: Profit and Balance Sheet Growth in Recent Years
Profit and Balance Sheet Growth in Recent Years Revenues (USD billion)(1) Net Profits (USD billion)(1) +4% +20% 2.9 1.1 1.0 0.9 2.3 0.8 1.9 2.2 0.6 1.3 0.3 0.3 0.7 0.7 2006 2007 2008 2009 1Q 10 2006 2007 2008 2009 1Q 10 Assets and Loans (USD billion) Deposits and Equity (USD billion) Assets Loans De
Slide 14: Q1 2010 and 2009 Financial Results
Q1 2010 and 2009 Financial Results Q1 2010 Financial Results Highlights Key Performance Indicators Operating profit before impairment allowances of USD 460m; -1% from USD USD million Q1 Q1 Change 2009 2008 Change 463m in Q1 2009; +4% from USD 442m in Q4 2009 2010 2009 (%) (%) Net interest income 4
Slide 15: Income
Income Net Interest Margin Trends (%) Q1 2010 NIM of 2.58%; -27bps from 2.85% in Q4 2009: 3.01 – Loan spreads declined due to rising Eibor rates and mix impact of Qtrly NIM (AIEA) 2.85 2.76 declining retail loan balances 2.65 2.60 2.58 – Continued pressure on liability spreads given shortage of me
Slide 16: Operating Costs and Efficiency
Operating Costs and Efficiency Highlights Cost to Income Ratio Trends(1) The headline cost to income ratio rose by 0.6% from 33.3% in 2009 to Cost:income ratio 33.9% in 1Q 2010 Core cost:income ratio The core cost to income ratio rose by 1.6% from 35.1% in 2009 to 36.7% in 1Q 2010 Operating co
Slide 17: Asset Quality
Asset Quality Loans & Receivables and Islamic Financing Highlights Loan Portfolio by Type – Q1 2010(1) Credit quality remains satisfactory across the Bank’s corporate and 100% = USD 59.5b retail portfolios Increase in delinquencies and NPLs is within expectations Retail NPL ratio, excluding im
Slide 18: Asset Quality
Asset Quality Retail and Corporate Loans & Receivables Corporate & Sovereign Lending Portfolio By Sector(1) Corporate Credit Quality Real Estate & Contracting 100% = USD 47.5b • Portfolio credit quality remains satisfactory, despite challenging • Exposures to Real Estate and Contracting Sector are U
Slide 19: Asset Quality
Asset Quality Investments & Trading Securities Highlights MTM Impact The recovery of equity and bond markets in Q1 2010 resulted in positive P&L impact Cum. Total USD million changes net impact of mark to markets and impairments on investment securities Balance Income Impairm. in FV Underlying q
Slide 20: Capital Adequacy
Capital Adequacy Highlights Capital Ratios - Basel I (USD billion) Capital adequacy ratio at 21.9% in Q1 2010 vs. 20.8% in Q4 2009 T1 T2 T1 % CAR % 21.9% Tier 1 ratio increased from 13.3% in Q1 2009 to 13.9% in Q1 2010 as 16.2% 19.0% 19.9% 20.8% 13.3% 13.9% profit generation for the period excee
Slide 21: Funding and Liquidity
Funding and Liquidity Highlights Loan to Deposit Ratios (%) Liquidity in the UAE banking system improved in 2009 primarily due to Headline LTD Ratio % 129% initiatives taken by the UAE Ministry of Finance and UAE Central Bank Adjusted LTD Ratio % 126% 127% 122% Funding remains stable and deposit
Slide 22: Divisional Performance
Divisional Performance USD billion USD million 46.9 46.4 Corporate Banking recorded a successful quarter 301 Corporate Banking +16% Key focus during the period was on balance sheet optimisation, continued proactive management of credit quality, building non-risk based and fee generating business
Slide 23: Divisional Performance (cont'd)
Divisional Performance (cont’d) USD million Revenues in Q1 2010 were USD 75m compared with USD 174m Global Markets & 174 in Q1 2009, the decline being primarily due to contraction in the -57% Treasury spreads generated from interbank funding in Q1 2010 compared to Q1 2009 75 The Trading business
Slide 24: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy and Outlook 24
Slide 25: Strategic Imperatives for 2010
Strategic Imperatives for 2010 Objectives Evidence of success in Q1 2010 Prudent lending growth CAR strengthened to 21.9% from 20.8% at Focus on funding end-2009 – Leverage distribution network Tier 1 increased to 13.9% from 13.3% at end-2009 Optimise – Maintain & develop wholesale sources o
Slide 26: Outlook
Outlook UAE GDP is expected to recover modestly to c.2.5% in 2010 and c.4.5% in 2011 Lower inflation, stable USD and property market declines have enhanced Dubai’s cost- competitiveness Q1 2010 has witnessed early signs of stability, increased economic activity and improved consumer sentiment
Slide 27: Summary
Summary Robust financial performance with steady income and strong operating profit generation Significantly improved liquidity metrics and strong capital ratios due to success of balance sheet optimisation initiatives and continued proactive support from federal and local Government Credit qu
Slide 28: Appendix A: Merger Update
APPENDIX A Merger Update 28
Slide 29: Merger Update
Merger Update Integration completed successfully Mobile and Legal Emirates NBD’s Treasury Online Banking integration Large Corporate operations integrated; New Core completed; EBI First AGM for Unit (LCU) is integrated in enhanced Banking system and NBD Emirates NBD inaugurated single premises funct
Slide 30: Merger Update: Organisation Structure and Brands
Merger Update Emirates NBD Organisation Structure and Brands Associate companies Emirates NBD Asset Management Emirates Islamic Bank (99.8%) Union Properties Group (47.6%) Emirates NBD Securities (Brokerage) Emirates NBD Capital Emirates Money (Consumer Finance) Network International National Genera
Slide 31: Merger Update: Synergies
Merger Update Synergies exceed 2009 full year target by 33% and already exceed 2010 cost and one-off synergies a year ahead of plan Target Synergies Key Drivers of Synergies USD 94m of recurring annual synergies by the third year post merger, Revenue synergies for 2008 and 2009: plus USD 7m of o
Slide 32: Appendix B: Awards
APPENDIX B Awards 32
Slide 33: 2010 Awards
2010 Awards March 2010- 2010 Financial Sector Technology (FST London) award for “Systems Integration Project of the Year” February 2010- The number one banking brand in the Middle East Award by The Banker (April 2010) -Banker Middle East - Products Award for Best Personal Loan February 2010- Best Lo
Slide 34: Investor Relations
Investor Relations PO Box 777 Emirates NBD Head Office, 4th Floor Dubai, UAE Tel: +971 4 201 2606 Email: IR@emiratesnbd.com Ben Franz-Marwick Head, Investor Relations Tel: +971 4 201 2604 Email: bernhardf@emiratesnbd.com Chaden Boustany Investor Relations Analyst Tel: +971 4 201 2628 Email: ChadenB@