Metropolitan Bank & Trust Co. · PSE:MBT
Metropolitan Bank & Trust — Q1 2024 Earnings Presentation
40 slides from Metropolitan Bank & Trust's earnings presentation, May 2, 2024
Slide 1: 1Q 2024 Analysts' Briefing
1Q 2024 Analysts’ Briefing 2 May, 2024
Slide 2: 1Q24 Earnings Call
1Q24 Earnings Call 2024 Metropolitan Bank & Trust Company 2 This document is for internal use only and may contain privileged, proprietary or otherwise private information. It must not be released to other parties in whatever form without prior consent to the authors.
Slide 3: Macroeconomic and Industry Developments
MACROECONOMIC AND INDUSTRY DEVELOPMENTS
Slide 4: Macro-economic backdrop
Macro-economic backdrop Inflation Policy rate GDP 2020 2021 2022 2023 Mar-24 2020 2021 2022 2023 2020 2021 2022 2023 2.4% 3.9% 5.8% 6.0% 3.7% -9.5% 5.7% 7.6% 5.5% 2.0% 2.0% 5.5% 6.5% • CPI pick-up in March from 3.4% in February • 4Q23 GDP settled at 5.5% with stronger • Monetary Board kept RRP stead
Slide 5: Banking Industry
Banking Industry 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% 9% 12% 10% 8% 9% 9% 7% 9% 10% 8% 9% 7% 8% 15% 4% 6% 10% 7% 5% 14% 12% 9% 7% 9% 9% 7% 7% 5% 6%
Slide 6: Financial Performance 1Q 2024
FINANCIAL PERFORMANCE 1Q 2024
Slide 7: 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 Net Income YoY 9.3 9.3 9.3 9.3 10.5 10.4 10.9 10.5 12.0 +14% 35.0 0.5 0.4 0.7 2.1 0.9 7.5 6.0 5.9 -2% 1.5 5.9 2.3 1.1 5.9 6.0 25.0 5.8 5.9 6.0 27.7 2
Slide 8: 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 Quarterly NIM Interest from Investments Other Interest Expense Other Interest Income 48.0 4.05% 4.03% 4.00% 3.97% Higher accrual 3
Slide 9: Loan portfolio profile
Loan portfolio profile Healthy commercial and consumer growth Loan portfolio mix near pre-pandemic level Pbn Consumer Corporate & Commercial Consumer Corporate & Commercial 1,567 1,593 1,470 +12% YoY 1,421 1,436 +2% QoQ 1,228 1,248 1,144 +11% YoY 78% 78% 1,122 1,125 79% 78% 78% 78% +2% QoQ 299 311 3
Slide 10: Institutional segment profile
Institutional segment profile Top and mid-sized corporates leading loan demand Preference for term loans Pbn SME Corporate & Middle Market Long term Short term 1,400 1,228 1,248 +11% YoY 1,200 1,122 1,125 1,144 +2% QoQ 1,000 37% 35% 35% 31% 38% -8% YoY 800 1,112 1,133 +12% YoY 600 1,011 1,018 1,035
Slide 11: Consumer segment profile
Consumer segment profile Gross credit card receivables and auto leading retail build up Credit card share still expanding Pbn Others Auto Housing Credit Card & Others* 350 339 345 326 +15% YoY 311 299 +2% QoQ 300 146 150 +26% YoY 40% 41% 42% 43% 44% 138 128 +3% QoQ 250 120 200 150 93 92 Flat YoY 31%
Slide 12: Deposit profile
Deposit profile Managed deposit growth CASA ratio eases as rates stay elevated Pbn TDs CASA CASA TDs 37% 38% 38% 41% 40% 41% 2,500 2,347 2,383 2,375 +5% YoY 2,263 2,253 Flat QoQ 63% 62% 62% 59% 60% 59% 2,000 4Q19 1Q23 2Q23 3Q23 4Q23 1Q24 1,390 1,439 1,392 1,500 1,406 1,401 -1% YoY -3% QoQ CASA depos
Slide 13: 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% 15.4% 15.1% 7.6% 16.0% 7.4% 7.4% Credit Cards 14.3% 7.3% 6.7% 7.5% 14.0% 6.5% 5.4% 5.7% 5.6%
Slide 14: Non-interest income drivers
Non-interest income drivers Overall weakness as trading income down from high base Fee Income eases Pbn Others Asset sales Pbn Fee income Trust income Leasing Service Fees & Trust 7.0 YoY Trading & FX gains 6.0 5.0 4.4 4.3 4.5 4.5 4.2 -6% YoY 0.3 0.3 0.3 10.0 4.0 0.3 0.3 -17% 9.0 3.0 8.1 8.0 8.0 2.0
Slide 15: Operating expense breakdown
Operating expense breakdown Moderating opex growth Improving cost-to-income ratio Pbn Others Occupancy & equipment Depreciation Taxes & licenses 25.0 Manpower 60.0% YoY 53.9% 55.0% 20.0 18.3 51.6% 52.0% 50.9% 51.3% 17.6 18.0 +7% 16.9 16.8 50.0% +10% 15.0 45.0% 7.0 7.8 7.4 6.7 6.8 40.0% 10.0 2.9 3.0
Slide 16: 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 67 59 49 59 100 58 56 100 14 50 50 189% 184% 187% 180% 174% - - Pbn Cumulative Total Allowance Provisions for Credit 60.0 60.0 50.4 50.0
Slide 17: 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 4.1% 4.1% 4.2% 4.3% 5.0% 4.0% 4.5% 4.0% 60.0 3.5% 50.0 3.0% 2.5% 50.0 2.0% 2.3% 2.3% 2.1% 2.1% 2.2% 1.5% 35 40.0 33 1.0% 32 31 32 40.0 0.5% 0.0% 30.0 30.0 1Q23 2Q
Slide 18: 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% 3.5% 2.6% 7.0% 2.5% 3.0% 2.4% 3.5%
Slide 19: Asset quality indicators per segment
Asset quality indicators per segment Commercial NPL ratio continue to ease Consumer NPL ratio stable NPLs NPL ratio NPL ratio Industry Consumer NPL ratio 10.0% 6.4% 6.3% 6.0% 5.8% 9.0% 8.0% 35 1.6% 1.6% 1.5% 1.4% 1.4% 7.0% 6.0% 5.0% 2.7% 0.0% 2.6% 2.6% 2.7% 2.6% 30 4.0% 3.0% 2.0% 25 1.0% -5.0% 0.0%
Slide 20: Consumer asset quality trend
Consumer asset quality trend Auto NPLs largely steady Mortgage NPLs on a declining trend Recent credit card NPL pick-up stabilizing NPLs NPL ratio Industry NPLs NPL ratio Industry NPLs NPL ratio Industry 20 14.0% 20 15.0% 20 18 15% 12.0% 18 18 16 7.5% 7.6% 7.1% 6.9% 10.0% 16 16 14 7.9% 7.5% 10.0% 7.
Slide 21: Other asset quality indicators
Other asset quality indicators Real and other properties acquired (ROPA) still steady Total non-performing assets (NPA) remains low Pbn ROPA Ratio to Gross Loans Pbn NPA NPA Ratio 15.0 0.7% 0.7% 0.7% 0.8% 1.2% 1.3% 1.2% 1.2% 1.2% 0.7% 50 1.5% 0.7% 0.7% 13.0 45 1.0% 0.6% 11.0 40 0.5% 0.5% 9.0 35 0.0%
Slide 22: Capital and liquidity
Capital and liquidity High capital ratios offers strong buffers against risks High Basel III Leverage Ratio, Liquidity Coverage Ratios CAR CET-1 BLR LCR 21.00% 17.6% 17.9% 18.4% 18.3% 16.8% 21.0% 16.8% 17.1% 17.6% 17.4% 16.0% 350% 15.0% 270% 17.50% 17.5% 300% 245% 238% 243% 249% 14.0% 14.00% 10.0% 9
Slide 23: Digital metrics on retail clients
Digital metrics on retail clients 2019 2020 2021 2022 2023 1Q24 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% 36% 34% 33% 1Q24 Active base up 10% YoY 30% 26% 23% Strong growth in mobile 19% app downloads (1Q 202
Slide 24: Return on Equity – Trend
Return on Equity – Trend Return on Equity (ROE) Medium-term ROE drivers 12.51% 13.13% 13.67% Portfolio Growth 9.47% 10.29% • Grow loans portfolio by 1.5x-2.0x Real GDP 6.89% 4.36% • Increase consumer to 25-30% of total portfolio Improve Operational Efficiency 2019 2020 2021 2022 2023 1Q23 1Q24 • Low
Slide 25: Outlook – Positives and Challenges
Outlook – Positives and Challenges • Healthy discretionary spending and resumption of • Macro risks could affect demand recovery and asset investments to support loan demand. quality: o Global - geopolitical issues; global financial • Higher revenue base to support rising IT spend and instability ca
Slide 26: Summary
SUMMARY Sustained solid performance supported by asset growth, stable margins, better efficiencies and improving asset quality. Strong balance sheet and liquidity ratios continue to ensure Metrobank’s ability to support client needs as the economy expands. Expanding revenue base will support increas
Slide 27: Financial Summary
Financial Summary In PHP billion Income 1Q 1Q FY FY Balance Sheet 1Q 2023 1Q 2024 YoY YoY YoY Statement 2023 2024 2022 2023 Total Assets 2,879 3,186 11% Net Interest 24.9 28.7 15% 85.5 105.0 23% Loans and Receivables, Gross 1,421 1,593 12% Income Non Interest Total Deposits 2,263 2,375 5% 8.1 6.6 -1
Slide 28: Additional Information
@ Metrobank A voure in good hands
Slide 29: Metropolitan Bank & Trust Company (Metrobank)
Metropolitan Bank & Trust Company (Metrobank) Overview Financial Data (PHP bn) 1Q 2024 DIVERSIFIED Total Assets 3,186 60 YEARS OF MULTI-AWARDED FINANCIAL CONGLOMERATE TRADING INFORMATION MBT PM | MBT.PS Ticker Loans and Receivables, Gross Total Deposits 1,593 2,375 SERVICE EXCELLENCE USD 5.5 Bn Mark
Slide 30: 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 31: Extensive Domestic and Overseas Coverage
Extensive Domestic and Overseas Coverage Total Group 18,000+ employee base Note: Includes Parent + Major Subs of the Bank Domestic Branch and ATM Networks Overseas Network Coverage 952 30+ branches Branches, subsidiaries, offices 2,325 ATMs 110+ Remittance tie-ups 160+ Remittance agents 2024 Metropo
Slide 32: Sustainability Journey: Our Progress in 2023
Sustainability Journey: Our Progress in 2023 Enhancing the ESRM Framework: Improving our sustainability disclosures: We Weare guided are guided by ourby E&Sour E&S Risk Risk Appetite Appetite Statement (RAS) Statement (RAS) We are working towards being more transparent We are guided by our E&S Risk
Slide 33: Debt Issuances
Debt Issuances Unissued 2024 28.0 Bond Issuance 0.5 2022 76.3 USD2 Billion USD1 billion PHP200* 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. *Note: The Board of Directors of
Slide 34: Outstanding Debt Issuances & Investment Grade Credit Ratings
Outstanding Debt Issuances & Investment Grade Credit Ratings Debt Issuance Details Debt Maturity Profile (PHP Bn) Baa2 Jul-23 Stable Issue Coupon Maturity Amount • Robust capitalization, with a proven Type Date Rate Date (PHP Bn) history of support from shareholders 2024 36.15 • Strong funding and l
Slide 35: Loan Portfolio Breakdown
Loan Portfolio Breakdown MBT Loan Portfolio By Industry Philippine Banks Loan Portfolio By Industry 16% 14% 14% 13% 12% 12% 12% 12% 12% 11% 16% 10% 11% 10% 10% 10% 10% 10% 11% 10% 12% 12% 15% 18% 20% 20% 20% 20% 20% 20% 14% 15% 19% Trade 15% Manufacturing 9% 9% 9% 8% 8% 12% 12% 14% 9% 13% Real estat
Slide 36: Currency Breakdown
Currency Breakdown LOAN PORTFOLIO DEPOSITS Foreign Foreign Currency, Currency, 31% 19% Philippine Peso, 81% Philippine Peso, 69% 2024 Metropolitan Bank & Trust Company 36This document is for internal use only and may contain privileged, proprietary or otherwise private information. It must not be re
Slide 37: New Dividend Policy
New Dividend Policy 1. Growth prospects intact Sufficient buffer to meet healthy loan demand sustainably over the medium term Key information Regular Cash • Php3.00 2. Robust NPL risk buffers already in place Dividends • Semi-annual payout per share NPL cover continues to remain ample vs. risk of ri
Slide 38: Recent Awards and Recognition
Recent Awards and Recognition Most Strongest Bank Best Bank of the Year Best Domestic Recommended Domestic Bank in Best Bank for Ultra- in the Philippines in the Philippines Private Bank Retail Bank in the the Philippines High-Net-Worth in the Philippines Philippines 2023, 2022 2023, 2022, 2021 2023
Slide 39: 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 For your comments and queries contact us via: Annual Corporate Governance Report investor.r
Slide 40: Metrobank
S Metrobank You're in good hands THE BANKER ‘THE ASIAN BANKER’ THE STRONGEST BANK BIN THE PHILIPPINES 2023 t by balance shee
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