Slide 1: Kina Securities Ltd Half year results – 30 June 2016
Kina Securities Ltd Half year results – 30 June 2016 August 2016
Slide 2: Important notice and disclaimer
Important notice and disclaimer You must read this notice before reading or making any use of this document or any information contained in this document. By accepting this document, you agree to the following terms and conditions, including any modifications to them. Confidentiality: This Presentat
Slide 3: Kina achieves solid earnings growth
Kina achieves solid earnings growth • Statutory profit of PGK20.5 million for the six months to June, compared with Statutory Profit After Tax PGK4.5 million in the prior corresponding (PGK Mln) half 20.5 • Loan growth of 17% from December 2015, taking total lending to PGK437 million • Net interest
Slide 4: Corporate Highlights
Corporate Highlights • Maybank amalgamation completed • Management team strengthened • Cost management initiatives being implemented • Correspondent banking arrangements being negotiated for USD • Key Fund Administration customer (NSL) retained for 3 years • NSL Fund Management extended 4
Slide 5: Kina Bank - Lending gaining momentum
Kina Bank - Lending gaining momentum Kina Lending Book Lending breakdown (PGK Mln) 2016 h/y 480 growth Term/Business 437 annualised 55% = 34% 374 Overdrafts 16% 196 202 Housing 6% 23% Esiloan/ other 2013 2014 2015 Jun'16 Jul-16 5
Slide 6: Large low cost deposit base
Large low cost deposit base Kina Deposits Deposit profile (PGK Mln) (% of total) Deposits = 685 At Call 636 147% of 55% loans +12 months 13% 252 225 6 months 6% 1-3 months 26% 2013 2014 2015 Jun-16 Deposits reduced by a single major maturity 6
Slide 7: Income growing steadily
Income growing steadily Interest and non-interest income (PGK Mln) 31.2 30.5 26.2 16.7 17.1 9.7 Jun-15 Dec-15 Jun-16 Net Interest Income Non-interest Income 7
Slide 8: Other Income rising
Other Income rising Foreign Exchange Wealth Management (PGK Mln) (PGK Mln) 12.9 10.9 8.9 7.9 7.8 0.0 Jun-15 Dec-15 Jun-16 Jun-15 Dec-15 Jun-16 8
Slide 9: Funds Under Management growing
Funds Under Management growing (PGK Mln) PGK5.8 billion 6000 5,856 5,437 5500 5,338 5000 4,823 4,571 4500 4000 4,140 3500 3000 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 9
Slide 10: Funds Under Administration growing
Funds Under Administration growing Member numbers Funds Under Administration (000) (PGK Mln) 5200 166 165 5171 164 5152 163 163 162 5099 5091 5083 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 10
Slide 11: Expenses reflect investment phase
Expenses reflect investment phase 14.4 14.6 Cost to Income ratio of 48% Jun-15 Dec-15 Jun-16 9 9.2 8.2 6.4 5.9 5.4 4.1 3.3 3.1 1.1 0 0 0 Staff costs Admin IPO related Maybank Other Expenses costs acquisition costs 11
Slide 12: Strong capital adequacy, low bad debts
Strong capital adequacy, low bad debts % % of Capital 31* Adequacy 33* PGK Gross 27.5 millions Loans 24.9 23.3 Loan impairment expense 2.5 0.6 11.2 12* 10.5 9.9 11* Gross non-performing loans 6.0 1.3 Leverage Total provision* 13.6 3.0 2012 2013 2014 2015 Jun-16 *Includes the fair value adjustment on
Slide 13: Management team strengthened
Management team strengthened CEO Syd Yates Risk Finance and Banking Wealth Management Treasury Shared Services Danny Robinson Deepak Gupta Michael Van Chetan Chopra Dorssen Personal Business Terry Hall Don Hallam 13
Slide 14: Synergies from the Maybank acquisition
Synergies from the Maybank acquisition PROGRESS INVESTMENT Reallocating investment portfolio into assets with PORTFOLIO higher returns and longer maturities OPTIMISATION1 COST OF FUNDING Reduction in cost of funding due to enhanced scale OPTIMISATION1 and capital position Expense synergies from the
Slide 15: Delivering Shareholder Value
…Delivering Shareholder Value 15
Slide 16: PNG – 2.2% growth forecast in 2016
PNG – 2.2% growth forecast in 2016 Economic Growth 2002-2016 16
Slide 17: Positive outlook maintained
Positive outlook maintained 2016 guidance • Net interest margin 8-10% • Cost to income ratio 45-50% • Lending market share growth • Deposit / loan ratio > 150% • Conservative provisions • Strong capital position • Strong EPS growth 17
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