National Bank Of Kuwait K.s.c. · KSE:NBK

National Bank Of Kuwait K.s.c — National Bank of Kuwait — Q1 2017 Earnings Presentation

29 slides from National Bank Of Kuwait K.s.c's earnings presentation, May 2017

  1. Slide 1: National Bank of Kuwait Investor Presentation

    National Bank of Kuwait Investor Presentation May 2017

  2. Slide 2: Disclaimer

    Disclaimer THE INFORMATION SET OUT IN THIS PRESENTATION AND PROVIDED IN THE DISCUSSION SUBSEQUENT THERETO DOES NOT CONSTITUTE AN OFFER OR SOLICITATION OF AN OFFER TO BUY OR SELL SECURITIES. IT IS SOLELY FOR USE AT AN INVESTOR PRESENTATION AND IS PROVIDED AS INFORMATION ONLY. THIS PRESENTATION DOES N

  3. Slide 3: Contents

    Contents Section 1 Overview of NBK Section 2 Overview of Operating Environment Section 3 Strategy and Business Overview Section 4 Financial Performance (Historical) Section 5 Performance Overview 1Q 2017 Section 6 Appendix 2

  4. Slide 4: NBK at a Glance

    NBK at a Glance Snapshot Financial Snapshot  National Bank of Kuwait S.A.K.P. (“NBK” or the “Bank”) was USD million 2014 2015 2016 established in 1952 as the first local bank and the first shareholding 71,482 77,433 79,423 Total Assets company in Kuwait and as the first indigenous bank in the GCC.

  5. Slide 5: Key Strengths

    Key Strengths High Credit Ratings and among the Largest Banking Group in Kuwait with Top Brand Values Regionally Dominant Market Position  NBK has one of the highest credit ratings in the MENA  As at 31 December 2016, the Bank was the largest region. bank in Kuwait in terms of total assets, loans

  6. Slide 6: Rating Excerpts

    Rating Excerpts “ The standalone baseline credit assessment (BCA) of a3, reflects the bank's (1) dominant position in its domestic market, underpinning its resilient core profitability and growth prospects; and (2) robust financial fundamentals including consistently strong asset quality, as well as

  7. Slide 7: Contents

    Contents Section 1 Overview of NBK Section 2 Overview of Operating Environment Section 3 Strategy and Business Overview Section 4 Financial Performance (Historical) Section 5 Performance Overview 1Q 2017 Section 6 Appendix 6

  8. Slide 8: Overview of Kuwait

    Overview of Kuwait Snapshot Current account remains in surplus Current account balance (USD bn, lhs) Current account balance (% GDP, rhs)  The State of Kuwait (“Kuwait” or the “Sovereign”) is a sovereign 80 45.3 56.0 43.6 40.9 state on the coast of the Arabian Gulf, covering a total area of 60 42.0

  9. Slide 9: Overview of Kuwait (Continued)

    Overview of Kuwait (Continued) Recent Developments Investment Investments (KWD bn, lhs) Investments (% Non-oil GDP, rhs)  Economic growth is seen improving despite the drop in oil prices, 15 40 37.9 as project awards pick up. Fiscal and external buffers give Kuwait 37.3 36.0 32.6 37 GDP ample capac

  10. Slide 10: Overview of the Kuwaiti Banking Sector

    Overview of the Kuwaiti Banking Sector Snapshot Overview of Basel III Implementation in Kuwait  The Kuwaiti banking sector comprises 23 banks, including 11 domestic  In June 2014, the Central Bank of Kuwait announced the implementation banks (five conventional, five Shariah-compliant and one speci

  11. Slide 11: The Dominant Kuwaiti Franchise

    The Dominant Kuwaiti Franchise NBK is the leading banking group in Kuwait with a market leading position across its business segments Total Assets (USD million) Customer Deposits (USD million) National Bank of Kuwait 79,423 National Bank of Kuwait 41,372 Kuwait Finance House 54,141 Kuwait Finance Ho

  12. Slide 12: Contents

    Contents Section 1 Overview of NBK Section 2 Overview of Operating Environment Section 3 Strategy and Business Overview Section 4 Financial Performance (Historical) Section 5 Performance Overview 1Q 2017 Section 6 Appendix 11

  13. Slide 13: NBK's Strategy

    NBK’s Strategy The Group’s strategy, which is based on two main pillars, focuses on defending and growing its leadership position in Kuwait whilst also diversifying its business  The Bank aims to (i) remain the primary banker for the leading local companies whilst continuing to be active in the  C

  14. Slide 14: Kuwait Operations

    Kuwait Operations NBK is a universal bank and the industry leader in all key business segments in Kuwait with an average market share of 30% Overview and strategy Corporate Banking Consumer Banking Private Banking  Remain the primary banker for most of the local  Maintain undisputed leadership in

  15. Slide 15: International Operations

    International Operations International Operations  NBK’s international operations currently contributed to circa 30% of its bottom line with Established or Branches Legal structure the Bank aspiring to increase this contribution. acquired  The Bank generally aims to maintain a majority stake in it

  16. Slide 16: Boubyan Bank (58.4% owned subsidiary)

    Boubyan Bank (58.4% owned subsidiary) Market share of Total Assets(%) Key Highlights  Islamic banking has been gaining strong grounds in the Kuwaiti market in recent years, representing close to 40% of assets and deposits at year-end 2016.  After a series of gradual share acquisitions since 2009,

  17. Slide 17: Contents

    Contents Section 1 Overview of NBK Section 2 Overview of Operating Environment Section 3 Strategy and Business Overview Section 4 Financial Performance (Historical) Section 5 Performance Overview 1Q 2017 Section 6 Appendix 16

  18. Slide 18: Operating Performance & Profitability

    Operating Performance & Profitability Resilient Profitability (USD mn) Stable Returns (%) Net Operating Income Net Profit Return on Average Assets Return on Average Equity 10.5% 10.5% 10.2% 2,391 2,446 2,169 926 969 859 1.3% 1.2% 1.2% 2014 2015 2016 2014 2015 2016 Operating Income Composition (USD m

  19. Slide 19: Balance Sheet Parameters

    Balance Sheet Parameters Assets & Loans and Advances (USD mn) Breakdown of Assets by Type (As at 31 December 2016) Loans, advances & Islamic financing Total Assets Goodwill and Other other intangible 3% Cash and short 77,433 79,423 assets term funds 71,482 2% 11% CBK Bonds and Investment Kuwait Tbil

  20. Slide 20: Funding and Liquidity Positions

    Funding and Liquidity Positions Customer Deposits (USD mn) Strong Liquidity Position (USD mn) Liquid Assets Liquid Asset Ratio 38.8% 38.6% 37.1% 36,947 39,571 41,372 27,707 28,735 30,650 2014 2015 2016 2014 2015 2016 (Total Liabilities) Funding Mix (USD mn) Overview of Investment Securities1 – USD 1

  21. Slide 21: Capitalization and Asset Quality

    Capitalization and Asset Quality Total Equity1 Breakdown (USD mn) Capital Adequacy (%) Share capital Statutory reserves Tier 1 Ratio Capital Adequacy Ratio Regulatory CAR Retained Earnings Other Reserves & Treasury Shares 9,465 8,706 9,043 17.7% 2,875 16.8% 2,929 3,004 15.7% 14.5% 14.7% 3,817 3,340

  22. Slide 22: Contents

    Contents Section 1 Overview of NBK Section 2 Overview of Operating Environment Section 3 Strategy and Business Overview Section 4 Financial Performance (Historical) Section 5 Performance Overview 1Q 2017 Section 6 Appendix 21

  23. Slide 23: 1Q 2017 Key Performance Extracts

    1Q 2017 Key Performance Extracts Interest Margins (%) Income Statement Key Highlights (USDmn) Net Interest Margin USD million 1Q 2016 1Q 2017 2.55% Net Interest Inc. & net inc. from Islamic financing 448 484 2.39% Fees and Commissions 110 110 Net Operating Income 588 641 Total Operating Expenses 192

  24. Slide 24: 1Q 2017 Key Performance Extracts (Continued)

    1Q 2017 Key Performance Extracts (Continued) Net Loan Portfolio (USD bn) Loans to Assets (USD bn) Net Loans Net loan growth YoY (%) Total Assets Loans/Assets 9.6% 56.2% 56.6% 55.0% 3.6% 0.4% 44.5 44.7 46.1 81.0 79.4 81.4 Mar-16 Dec-16 Mar-17 Mar-16 Dec-16 Mar-17 Loan exposure by sector (%) Non-Perfo

  25. Slide 25: Contents

    Contents Section 1 Overview of NBK Section 2 Overview of Operating Environment Section 3 Strategy and Business Overview Section 4 Financial Performance (Historical) Section 5 Performance Overview 1Q 2017 Section 6 Appendix 24

  26. Slide 26: Kuwait Selected Mega Projects

    Kuwait Selected Mega Projects Project Sector Value (KD bn) Scope Status 29,000 residential units, schools and other Underway: Package 2 contract bids have been submitted. Package 1’s completion South Al Mutlaa City Housing 2.33 facilities date has been pushed to Sept 2020. New Refinery Project Under

  27. Slide 27: Consolidated Financials 1Q 2017 (USD million)

    Consolidated Financials 1Q 2017(USD million) Income Statement (USD million) 1Q-16 1Q-17 Balance sheet (USD million) 1Q-16 1Q-17 Interest Income 511 552 Cash and short term funds 14,144 8,876 Central Bank of Kuwait bonds 2,234 2,425 Interest Expense 138 153 Kuwait Government Treasury bonds 1,281 2,51

  28. Slide 28: Consolidated Statement Of Income (USD million)

    Consolidated Statement Of Income (USD million) USD million 2014 2015 2016 Interest Income 1,685 1,920 2,183 Interest Expense 374 458 622 Net Interest Income 1,311 1,462 1,561 Murabaha and other Islamic financing income 286 349 420 Distribution to depositors and Murabaha costs 56 72 111 Net Income fr

  29. Slide 29: Consolidated Statement Of Financial Position (USD million)

    Consolidated Statement Of Financial Position (USD million) USD million 2014 2015 2016 Cash and short term funds 10,277 11,424 8,817 Central Bank of Kuwait bonds 1,755 2,638 2,457 Kuwait Government treasury bonds 1,131 1,247 1,618 Deposits with banks 6,729 4,681 7,901 Loans, advances and Islamic fina

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