Metropolitan Bank & Trust Co. · PSE:MBT
Metropolitan Bank & Trust — Investor Presentation (August 2024)
36 slides from Metropolitan Bank & Trust's investor presentation, Aug 2, 2024
Slide 1: Company Presentation
<& Metrobank BA vourre in good hands Company Presentation
Slide 2: Macroeconomic and Industry Developments
MACROECONOMIC AND INDUSTRY DEVELOPMENTS
Slide 3: Recent macroeconomic developments
Recent macroeconomic developments Inflation Policy rate GDP 2020 2021 2022 2023 Jun-24 2020 2021 2022 2023 1Q24 2020 2021 2022 2023 2.4% 3.9% 5.8% 6.0% 3.7% -9.5% 5.7% 7.6% 5.5% 5.7% 2.0% 2.0% 5.5% 6.5% • CPI moderated in June from 3.9% in May driven • 1Q24 GDP rose by 5.7% YoY. While faster than •
Slide 4: Banking industry trends
Banking industry trends Loan growth recovers up as NPL ratio picks up CASA growth remains subdued; system still liquid Loan growth Deposit growth CASA growth 17% 18% 14% 18% 20% 15% 9% 9% 11% 11% 11% 11% 9% 7% 8% 11% 12% 10% 8% 9% 9% 7% 9% 10% 8% 9% 7% 9% 15% 4% 6% 10% 7% 5% 14% 12% 9% 7% 9% 9% 7% 7
Slide 5: Financial Performance 1H 2024
FINANCIAL PERFORMANCE 1H 2024
Slide 6: Sustaining solid earnings growth
Sustaining solid earnings growth Net Interest Income Fees and Other Non-Interest Income Trading & FX gains Operating expenses Provisions Taxes and NCI 120.0 Net Income Net Income 100.0 YoY YoY 20.9 23.6 +13% 10.4 10.9 10.5 12.0 11.6 +11% 80.0 35.0 0.5 0.4 0.7 +11% 3.1 12.4 0.9 6.0 5.9 6.5 60.0 +4% 5
Slide 7: Net interest income drivers
Net interest income drivers Asset expansion sustaining build-up in interest income Margins easing slightly Pbn Interest from Loans Interest expense from Deposits Pbn NII NIM Interest from Investments Other Interest Expense Other Interest Income 80.0 +14% YoY +15% YoY 70.0 80.0 4.50% +2% QoQ 60.0 3.9
Slide 8: Loan portfolio profile
Loan portfolio profile Strong commercial and consumer growth Sustaining Loan growth double-digit gaining momentum loan growth Pbn Consumer Corporate & Commercial Loan Growth YoY 1,650 +15% YoY 1,567 1,593 +4% QoQ 1,457 1,436 1,297 1,279 20% 14% 15% 1,296 +15% YoY 15% 12% 1,228 1,248 1,164 1,125 +4%
Slide 9: Institutional and commercial loans breakdown
Institutional and commercial loans breakdown Top and mid-sized corporates leading loan demand Gross credit card receivables and auto leading retail build up Pbn SME Corporate & Middle Market Pbn Others Auto Housing Credit Card & Others* 1,400 1,296 +15% YoY 354 +14% YoY 1,248 339 345 1,228 +4% QoQ 3
Slide 10: Deposit profile
Deposit profile Managed deposit growth CASA ratio eases as rates stay elevated Pbn TDs CASA CASA TDs +8% YoY 37% 27% 24% 33% 38% 40% 41% 42% 2,500 2,383 2,375 2,430 +2% QoQ 2,221 2,253 63% 73% 76% 67% 62% 60% 59% 58% 2,000 1,930 1,797 +1% YoY 1,714 2019 2020 2021 2022 1H23 2023 1Q24 1H24 1,439 1,392
Slide 11: Margin drivers
Margin drivers Asset yields stable and funding costs stabilizing Yields steady across most segment Quarterly NIM Loan yield Asset yield Investment securities yield 18.0% Funding cost Deposit cost 16.0% 16.1% 16.0% 15.4% 15.1% 15.2% 7.5% Credit Cards 7.5% 7.2% 7.3% 7.2% 7.3% 14.0% 6.5% 5.4% 5.7% 5.6%
Slide 12: Non-interest income drivers
Non-interest income drivers Recovery in fee income mitigating weakness in trading income Breakdown of NoII excluding trading income Pbn Others Asset sales Leasing Service Fees & Trust Trading & FX gains Others, +18% YoY Credit Cards, 17.0 10.0 +7% YoY 16.0 14.9 18% 15.0 YoY YoY 12. 8.0 31% 14.0 8.0
Slide 13: Operating expense breakdown
Operating expense breakdown Managed opex growth Cost-to-income ratio inching up Pbn Other Expenses Technology Premises Taxes and licenses Compensation and fringe benefits 25.0 45.0 55.0% 53.9% 53.3% YoY YoY 51.8% 52.3% 52.0% 40.0 36.4 50.9% 51.3% 35.0 33.7 +8% 20.0 18.3 18.0 18.4 +10% 50.0% 17.6 16.
Slide 14: Provisions trend
Provisions trend Easing credit costs on better asset quality NPL cover remains substantial Est. Credit Cost (bps) 350 293 350 300 300 250 250 200 200 150 67 91 150 59 49 59 100 58 56 100 14 12 50 50 - 184% 180% - 175% 172% 174% Pbn Cumulative Total Allowance Provisions for Credit 163% 163% 163% 60.0
Slide 15: Asset quality indicators
Asset quality indicators Stable NPL level NPL/Past Due ratios well below industry level Past Due ratio Industry Past Due Pbn Past Due NPL 4.5% 4.6% 4.4% 4.3% 5.0% 4.0% 60.0 3.8% 4.5% 4.0% 50.0 50.0 2.7% 3.5% 3.0% 2.5% 39 3.0% 2.8% 2.0% 36 40.0 35 1.9% 2.2% 2.1% 2.2% 2.1% 1.5% 32 34 40.0 1.0% 32 32 0
Slide 16: Asset quality indicators
Asset quality indicators Restructured loans remain low Combined NPLs and Restructured loans well below industry NPLs MBT Restructured loans ratio Industry Restructured Loans Ratio Industry NPL Ratio MBT Combined NPL + Restructured Loans as Ratio to Gross Loans 8.0% 4.5% 4.1% 3.1% 7.0% 4.0% 3.6% 6.0%
Slide 17: Asset quality indicators per segment
Asset quality indicators per segment Commercial NPL ratio remains stable Consumer NPL ratio easing NPL ratio NPL ratio Industry Consumer NPL ratio 16.0% 9.3% 1.6% 1.6% 1.7% 1.6% 9.3% 35 1.0% 1.4% 1.4% 14.0% 12.0% 0.0% 30 6.5% 6.3% 5.8% 10.0% 25 -5.0% 8.0% 4.1% 20 15 -10.0% 6.0% 5.3% 4.2% 10 2.3% 4.0
Slide 18: Consumer asset quality trend
Consumer asset quality trend Auto NPLs easing Mortgage NPLs also on a declining trend Slight increase in credit card NPL ratio NPL ratio Industry NPL ratio Industry NPL ratio Industry 14.0% 9.4% 8.9% 12.0% 9.2% 15.0% 10.7% 15% 12.0% 7.5% 7.6% 8.4% 10.0% 6.9% 6.9% 7.5% 10.0% 6.3% 6.0% 8.0% 6.8% 10% 5
Slide 19: Other asset quality indicators
Other asset quality indicators Real and other properties acquired (ROPA) steady Total non-performing assets (NPA) remains low Pbn ROPA Ratio to Gross Loans Pbn NPA NPA Ratio 15.0 0.8% 0.8% 0.9% 1.7% 1.5% 50 2.0% 0.7% 0.7% 0.7% 1.2% 1.3% 1.3% 1.2% 13.0 0.7% 0.7% 0.8% 1.2% 1.1% 1.5% 0.6% 45 0.7% 1.0%
Slide 20: Capital and liquidity
Capital and liquidity High capital ratios offers strong buffers against risks High Basel III Leverage Ratio, Liquidity Coverage Ratios BLR 15.0% CAR CET-1 10.9% 11.4% 11.0% 9.4% 9.7% 9.2% 9.0% 10.0% 8.3% 20.2% 20.1% 17.7% 17.9% 18.3% 16.8% 16.7% 21.0% 5.0% 17.5% Min. BLR 5% 19.3% 19.3% 17.5% 0.0% 14
Slide 21: Digital metrics on retail clients
Digital metrics on retail clients 2019 2020 2021 2022 2023 1H24 Digital penetration rate on a continuous upward trend, now at 39%, with 2.0M total digital users 575K 730K 920K 1.3M 1.5M 1.5M 39% 37% 34% 1H24 Active base up 4% YoY 30% 26% 23% Strong growth in mobile 19% app downloads +43% (2Q 2024 vs
Slide 22: Return on Equity – Trend
Return on Equity – Trend Return on Equity (ROE) Medium-term ROE drivers 12.51% 12.89% 13.27% Portfolio Growth 10.29% 9.47% 6.89% • Grow loans portfolio by 1.5x-2.0x Real GDP 4.36% • Increase consumer to 25-30% of total portfolio Improve Operational Efficiency 2019 2020 2021 2022 2023 1H23 1H24 • Low
Slide 23: Outlook – Positives and Challenges
Outlook – Positives and Challenges • Further recovery in discretionary spending and • A deterioration in macroeconomic indicators may resumption of corporate investment to support adversely affect consumer and business sentiment, consumer and commercial loan demand. affecting demand for retail and b
Slide 24: Summary
SUMMARY Solid performance was sustained owing to robust asset growth, stable margins, managed cost growth and healthy asset quality. Strong balance sheet and liquidity ratios enable Metrobank to continue supporting clients' needs as the economy grows. Expanding business base will support more invest
Slide 25: Financial Summary
Financial Summary In PHP billion Income 2Q 2Q 1H 1H Balance Sheet 1H 2023 1H 2024 YoY YoY YoY Statement 2023 2024 2023 2024 Total Assets 2,864 3,280 15% Net Interest 25.7 29.3 14% 50.6 58.0 15% Loans and Receivables, Gross 1,436 1,650 15% Income Non Interest Total Deposits 2,253 2,430 8% 6.8 5.4 -20
Slide 26: Additional Information
@ Metrobank A voure in good hands
Slide 27: Metropolitan Bank & Trust Company (Metrobank)
Metropolitan Bank & Trust Company (Metrobank) Overview Financial Data (PHP bn) 1H 2024 DIVERSIFIED Total Assets 3,280 61 YEARS OF MULTI-AWARDED FINANCIAL CONGLOMERATE TRADING INFORMATION MBT PM | MBT.PS Ticker Loans and Receivables, Gross Total Deposits 1,650 2,430 SERVICE EXCELLENCE USD 5.2 Bn Mark
Slide 28: Ownership and Investment Information
Ownership and Investment Information CORPORATE STRUCTURE MARKET DATA Trading information Ticker: GTCAP PM / GTCAP.PS Market cap: USD2.0 Bn Ty Family Ticker (Bloomberg | Reuters) MBT PM | MBT.PS & Other Free Related float Par value (PHP) 20.00 Parties Outstanding shares 4,497,415,555 37.2% 14.7% 48.0
Slide 29: Extensive Domestic and Overseas Coverage
Extensive Domestic and Overseas Coverage Total Group 19,000+ employee base Note: Includes Parent + Major Subs of the Bank Domestic Branch and ATM Networks Overseas Network Coverage 952 30 branches Branches, subsidiaries, offices 2,324 ATMs 100+ Remittance tie-ups 150+ Remittance agents 2024 Metropol
Slide 30: Debt Issuances
Debt Issuances Unissued 2024 28.0 Bond Issuance 0.5 2022 76.3 USD22 Billion USD1 billion PHP2001 Medium-Term 2021 42.5 Billion Bond 1.0 Note 5-Y and 10-Y USD Notes Programme Programme Listed March 2024 2020 0.5 5-Y: 5.375% 19.0 23.7 10Y: 5.50% 2019 interest rate p.a. 2018 1The Board of Directors of
Slide 31: PHP Bonds LTNCD
Outstanding Debt Issuances & Investment Grade Credit Ratings Debt Issuance Details Debt Maturity Profile (PHP Bn) Baa2 May-24 Stable Issue Coupon Maturity Amount Type • High capitalization, with a proven history Date Rate Date (PHP Bn) of shareholder support 2024 36.15 Jul-17 3.875% Jul-24 3.75 • Ro
Slide 32: Loan Portfolio Breakdown
Loan Portfolio Breakdown MBT Loan Portfolio By Industry Philippine Banks Loan Portfolio By Industry 14% 13% 15% 16% 14% 13% 14% 13% 12% 12% 12% 12% 12% 11% 11% 17% 10% 11% 10% 11% 11% 10% 10% 10% 10% 13% 13% 11% 12% 10% 15% 13% 18% 19% 20% 21% 20% 20% 20% 20% 20% 19% 19% 19% 22% 22% 19% Trade 19% Ma
Slide 33: Currency Breakdown
Currency Breakdown LOAN PORTFOLIO DEPOSITS Foreign Foreign Currency, Currency, 23% 18% Philippine Peso, 82% Philippine Peso, 77% 2024 Metropolitan Bank & Trust Company 34This document is for internal use only and may contain privileged, proprietary or otherwise private information. It must not be re
Slide 34: Recent Awards and Recognition
Recent Awards and Recognition Best Bank for Best Domestic Strongest Bank Best Bank of the Year Best Bank for Ultra- Corporate Private Bank in the Philippines in the Philippines Domestic Bank in High-Net-Worth* Responsibility in in the Philippines, the Philippines the Philippines Best Bank for Ultra-
Slide 35: For more information, please visit our website
For more information, please visit our website: Latest Annual Reports 2023 2022 2021 Financial Reports SEC 17-A SEC 17-Q BSP SOC Investor Relations https://metrobank.com.ph/about-us/investor-relations-program Annual Corporate Governance Report For your comments and queries contact us via: https://me
Slide 36: Metrobank
S Metrobank You're in good hands THE BANKER ‘THE ASIAN BANKER’ THE STRONGEST BANK BIN THE PHILIPPINES 2023 t by balance shee
Metropolitan Bank & Trust Company — Investor Presentation (August 2024) on 6ix