Saudi Investment Bank · TADAWUL:1030
Saudi Investment Bank — The Saudi Investment Bank — FY2023 Earnings Presentation
26 slides from Saudi Investment Bank's earnings presentation, Feb 14, 2024
Slide 1: Earnings Presentation FY 2023
Earnings Presentation FY 2023 14 February 2024 The Saudi Investment Bank – 4Q 2023 Earnings Presentation P. 1
Slide 2: Contents
Contents FY 2023 Performance Highlights 3 Strategy 4 Financial Performance 10 2024 Guidance 22 Appendix 25 The Saudi Investment Bank – 4Q 2023 Earnings Presentation P. 2
Slide 3: Growth momentum sustained in FY 2023 demonstrating solid progress
Growth momentum sustained in FY 2023 demonstrating solid progress Loans Deposits Loan growth of 17% YoY driven by corporate segment, while deposits grew 20% YoY on higher time +17% YoY +20% YoY deposits Double digit growth in operating income underpinned by 19% YoY growth in assets, and boosted by a
Slide 4: Strategy
Strategy The Saudi Investment Bank – 4Q 2023 Earnings Presentation P. 4
Slide 5: We aim to grow market share, increase fee income and improve efficiency to drive higher ROTE
We aim to grow market share, increase fee income and improve efficiency to drive higher ROTE Grow Market Share in Commercial Loans Grow Market Share in Retail Loans SAIB has already started to close the gap towards KSA Commercial KSA Market Share Retail KSA Market Share peers’ return on equity Retur
Slide 6: …with a strategy that is focused on growth opportunities in the KSA market
…with a strategy that is focused on growth opportunities in the KSA market Key Strategic Revisit segmentation and Redesign the operating Streamline and Priorities u coverage model Revamp value proposition automate key processes u Corporate Banking Public Institutions Accelerate Increase penetration
Slide 7: …supported by a comprehensive framework of initiatives across all core segments
…supported by a comprehensive framework of initiatives across all core segments Core Segments Key Strategic Priorities Corporate Banking Public Institutions Private Banking Consumer Banking Accelerate Increase penetration Accelerate Build differentiated value proposition profitable growth and grow D
Slide 8: Strategy execution across targeted near-term goals showing positive momentum in progress
Strategy execution across targeted near-term goals showing positive momentum in progress Corporate Banking Public Institutions Private Banking Personal Banking – Affluent focus • Build differentiated value prop to be • Increase penetration & grow deposits Strategic Goals • Continue accelerated growt
Slide 9: Venture studio is the immediate focus to drive SAIB's next wave of growth
Venture studio is the immediate focus to drive SAIB’s next wave of growth SAIB Venture Studio “SVS”: First product of the factory is 1 step away ...an in-house studio operating as a start-up or “venture” factory …to opportunistically leverage the KSA ecosystem without having to rely on it …aligning
Slide 10: Financial Performance FY 2023
Financial Performance FY 2023 The Saudi Investment Bank – 4Q 2023 Earnings Presentation P. 10
Slide 11: SAIB is focused on delivering strong results across key performance indicators
SAIB is focused on delivering strong results across key performance indicators FY 2023 DRIVERS LOANS & ADVANCES SAR 80.8bn +17% YoY Strong growth in Corporate (+23%) and Private Banking (+11%) loans Balance Sheet Strong growth in IBDs (+39%) mainly from public institutions, while NIBDs declined (-4%
Slide 12: Growth across assets, funded largely by increase in deposits
Growth across assets, funded largely by increase in deposits Total assets increased by 19% YoY as loans grew 17% and investments rose 15%, further supported by Loans & Advances (SARbn) Retail Corporate Other sizeable increases in SAMA and bank placements Total liabilities increased 22% YoY, mainly d
Slide 13: Loan growth continues to gain momentum driven by corporate lending
Loan growth continues to gain momentum driven by corporate lending 17% YTD growth in loans driven by 23% increase in corporate lending Active participation in syndicated loan market for infrastructure +1% Loans QoQ p projects, well supported by demand from other key sectors such as commerce, manufac
Slide 14: Investments grew 15% YoY driven by debt securities
Investments grew 15% YoY driven by debt securities 96% of investments were fixed rate debt securities as of FY 2023 61% of investments were accounted for at fair value through other comprehensive income and 38% at amortized cost High-grade investment portfolio with 58% of investment securities issue
Slide 15: Customer deposits increased 20% driven by IBDs
Customer deposits increased 20% driven by IBDs Deposits grew 20% YoY during FY 2023, mainly driven by increases in interest-bearing deposits IBDs rose 39% YoY from large inflows to time deposits amid higher +20% Deposits YoY p interest rate environment NIBDs declined by 4% YoY Corporate deposits dec
Slide 16: 17% growth in FY 2023 earnings propelled by NSCI and Fee growth, despite lower recoveries
17% growth in FY 2023 earnings propelled by NSCI and Fee growth, despite lower recoveries Net income increased 17% YoY in FY 2023 driven by strong growth of 21% in operating income, partially Total Operating Income Movement YoY (SARmn) offset by an increase of 15% in operating expenses and a rise in
Slide 17: NSCI growth of 20% YoY on 18% growth in earning assets and bps expansion in NIM
NSCI growth of 20% YoY on 18% growth in earning assets and 4bps expansion in NIM NSCI growth of 20% YoY was underpinned by 18% growth in NIM Average Earning Assets (SARbn) Consumer loans NIM Asset yield CoF average earnings assets, boosted further by a NIM expansion of 4 Corporate & other loans bps
Slide 18: Growth in fee and other income of 27% driven by foreign exchange and investment income
Growth in fee and other income of 27% driven by foreign exchange and investment income Fee & other income increased 85% YoY in Q4 2023, mainly driven Fee & Other Income Movement YoY (SARmn) by investment-related income reversing the previous year’s losses Foreign exchange income was well supported b
Slide 19: 15% increase in operating expenses continues to reflect implementation of strategic initiatives
15% increase in operating expenses continues to reflect implementation of strategic initiatives Operating expenses increased 15% YoY in FY 2023, mainly due to Operating Expenses (SARmn) increases in general & administration expenses and employee related costs as the bank continued to execute on its
Slide 20: Credit quality remained stable with NPL ratio at low levels
Credit quality remained stable with NPL ratio at low levels Total impairments of SAR 359mn for FY 2023, rising 87% YoY Impairments (SARmn) Cost of risk Impairment for loans mainly due to one-off recoveries in 2022 Other impairments Cost of risk at 0.47% in FY 2023 remained low 0.45% 0.43% 249 0.43%
Slide 21: Solid liquidity, funding and capital position with adequate buffers
Solid liquidity, funding and capital position with adequate buffers LCR declined by 24.0ppts during FY 2023 to 195.8%, while NSFR Liquidity Ratios Loans to Deposits Ratio SAMA LTD Headline LTD LCR NSFR eased 1.6ppts to 113.1% As of FY 2023, the SAMA regulatory LTD ratio was within required levels at
Slide 22: 2023 Results and 2024 Guidance
2023 Results and 2024 Guidance The Saudi Investment Bank – 4Q 2023 Earnings Presentation P. 22
Slide 23: 2023 Results against Guidance, and 2024 Outlook
2023 Results against Guidance, and 2024 Outlook 2023 GUIDANCE 2023 Actual 2024 GUIDANCE 2024 DRIVERS Balance Sheet LOANS & ADVANCES Mid to high teens +17% > 15.0% Strong growth in Corporate and Private Banking loans YoY NET INTEREST MARGIN 3.00% – 3.05% 2.98% Approx. 2.75% Continuing shift in deposi
Slide 24: Q&A
Q&A The Saudi Investment Bank – 4Q 2023 Earnings Presentation P. 24
Slide 25: Appendix
Appendix The Saudi Investment Bank – 4Q 2023 Earnings Presentation P. 25
Slide 26: SAIB Investor Relations
SAIB Investor Relations For more information, please visit www.saib.com.sa/en/investor-relations or contact SAIB Investor Relations at ir@saib.com.sa The Saudi Investment Bank – 4Q 2023 Earnings Presentation P. 26
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