Bank Of Queensland Limited · ASX:BOQ
Bank Of Queensland — Debt Investor Presentation (October 2022)
33 slides from Bank Of Queensland's debt investor presentation, Oct 24, 2022
Slide 1: Bank of Queensland Capital Notes 3 Offer
24 October 2022 For personal use only Bank of Queensland Capital Notes 3 Offer 24 October 2022 The Capital Notes 3 are not traditional fixed income securities. They can be Converted to Ordinary Shares (including at times when the risk of Ordinary Shares losing some or all of their value is relativel
Slide 2: Important information and disclaimer
For personal use only Important information and disclaimer Important Notice The information in this Presentation is for general information only. To the extent that certain statements contained in this Presentation may This presentation (Presentation) has been prepared by Bank of Queensland Limited
Slide 3: Contents
For personal use only Contents Offer summary 5 FY22 results summary 9 Key features of Capital Notes 3 18 Key risks associated with terms of Capital Notes 3 28 Key dates and Key contacts 31 BANK OF QUEENSLAND LIMITED CAPITAL NOTES 3 OFFER 3 This Investor Presentation is intended only for use by Insti
Slide 4: Acknowledgement of Traditional Custodians
For personal use only BOQ Group is proud to acknowledge the Traditional Custodians of the land on which we gather today and pay our respects to their Elders past and present. We extend that respect to Aboriginal and Torres Strait Islander peoples here today Artwork proudly created for Bank of Queens
Slide 5: Offer Summary
For personal use only OFFER SUMMARY 24 OCTOBER 2022 Bank of Queensland Capital Notes 3 Offer BANK OF QUEENSLAND LIMITED CAPITAL NOTES 3 OFFER 5 This Investor Presentation is intended only for use by Institutional Investors and Syndicate Brokers. Advisers should not use it in advising Retail Investor
Slide 6: Offer
Capital Notes 3 Offer Issuer • Bank of Queensland Limited (BOQ) For personal use only • Fully paid, unsecured, non-cumulative, perpetual, subordinated, convertible notes (Capital Notes 3) Offer • Capital Notes 3 are not deposit liabilities or protected accounts Offer Size • $300 million, with the ab
Slide 7: Offer structure and Target Market
Offer structure and Capital Notes 3 Target Market For personal use only • Institutional Offer made to certain Institutional Investors; and Offer structure • Broker Firm Offer made to eligible Australian resident clients of Syndicate Brokers who are either a (i) Wholesale Investor or (ii) Retail Inve
Slide 8: Summary of events that may affect Capital Notes 3
Summary of events that may affect Capital Notes 3 For personal use only Scheduled Scheduled Optional Conversion / Mandatory Issue Date Redemption / Resale Dates Conversion Date Potentially perpetual 14 November 15 December 15 March 15 June 16 June 2022 2028 2029 2029 2031 Approximately 6 6 Months 2
Slide 9: FY22 Results Summary
For personal use only FY22 RESULTS SUMMARY 24 OCTOBER 2022 Bank of Queensland Capital Notes 3 Offer BANK OF QUEENSLAND LIMITED CAPITAL NOTES 3 OFFER 9 This Investor Presentation is intended only for use by Institutional Investors and Syndicate Brokers. Advisers should not use it in advising Retail I
Slide 10: FY22 results overview
FY22 results overview For personal use only 1. Reported statutory NPAT up 15% to $426m1. Cash earnings declined 5%1 to $508m, given the prior year loan impairment benefit, with underlying profit up 1% › Income up by 1% impacted by ME GLAs decline prior to ownership and NIM pressure, recovering in se
Slide 11: FY22 results
FY22 results Higher underlying profit driven by disciplined lending growth and cost management For personal use only Key financial results ($m) FY22 FY22 v FY21 Total income 1,682 1% Operating expenses (937) 0% Underlying profit 745 1% Loan impairment expense (13) Large Cash profit before tax 732 (5
Slide 12: Net interest margin
Net interest margin Underlying 2H22 NIM up 4bps from funding cash rate benefits, partially offset by continued impact of For personal use only competition Summary Net interest margin – FY21 to FY22 (%) › NIM recovery in 2H22 with funding cost and replicating portfolio benefits (0.34%) 0.03% (0.03%)
Slide 13: Transformation investment
Transformation investment Ongoing investment to deliver transformation roadmap For personal use only Investment spend ($m) Summary › Overall investment increased primarily due to integration costs in the period 331 › Material capital investment in FY22 focused on new cloud digital retail banking pla
Slide 14: Executing on the ME integration
Executing on the ME integration Integration program well progressed and clear pathway to a single retail digital core banking platform For personal use only Integration benefits flowing Synergy and integration cost profile FY21 FY22 FY23 FY24+ › Synergies accelerated and increased from original expe
Slide 15: Funding & liquidity
Funding & liquidity Increasing deposit portfolio supporting business growth For personal use only Summary Funding mix ($bn)1 91.5 › Deposit to loan ratio broadly stable at 74% 83.5 19.4 › Growth in transaction accounts of 19% 17.7 50.8 9.3 11.6 › Cash rate increases driving growth in term deposits a
Slide 16: Capital
Capital Investing in growth and transformation For personal use only Summary CET1 (%) – FY21 to FY22 › CET1 remains above the target range, at 9.57% for 2H22 1.14% (0.51%) › Solid quality growth generating earnings (0.68%) › Continued investment in transforming the business (0.19%) 0.09% (0.08%) › I
Slide 17: Building a sustainable business
Building a sustainable business Supporting the transition towards decarbonisation, supporting our communities and enriching our people For personal use only Environmental commitments Supporting our communities Enriching people Supporting our customers to transition – Supporting regional areas – grow
Slide 18: Key Features of Capital Notes 3
For personal use only KEY FEATURES OF CAPITAL NOTES 3 24 OCTOBER 2022 Bank of Queensland Capital Notes 3 Offer BANK OF QUEENSLAND LIMITED CAPITAL NOTES 3 OFFER 18 This Investor Presentation is intended only for use by Institutional Investors and Syndicate Brokers. Advisers should not use it in advis
Slide 19: Key terms: Offer summary
Key terms: Offer summary For personal use only Issuer › Bank of Queensland Limited (BOQ) Offer › Fully paid, unsecured, non-cumulative, perpetual, subordinated, convertible notes (Capital Notes 3) Offer Size › $300 million, with the ability to raise more or less Face Value › $100 per Capital Note 3
Slide 20: Key terms: Distributions
Key terms: Distributions For personal use only › Floating rate, quarterly, discretionary, non-cumulative payments subject to Payment Conditions › Distributions are expected to be fully franked1 Distributions • if any Distribution payment is not fully franked, the Distribution will be increased to ad
Slide 21: Ranking of Capital Notes 3 in a Winding Up
Ranking of Capital Notes 3 in a Winding Up Ranking of Capital Notes 3 in a Winding Up if they have not Converted For personal use only Type Illustrative Examples Liabilities in Australia in relation to protected accounts (generally savings Higher Preferred and secured debt accounts and term deposits
Slide 22: Optional Conversion, Redemption or Resale
Optional Conversion, Redemption or Resale For personal use only › Subject to prior written approval by APRA, BOQ may elect to: Conversion, • Convert, Redeem or Resell all or some Capital Notes 3 on 15 December 2028, 15 March 2029, or 15 June 2029 Redemption or Resale • Convert, Redeem or Resell all
Slide 23: Mandatory conversion
Mandatory conversion For personal use only Scheduled mandatory conversion Mandatory conversion conditions › On 16 June 2031, subject to satisfaction of the Mandatory Conversion Conditions, BOQ must Convert all (but not some) Capital Notes 3 unless previously 16 May – 13 June 2031 16 June 2031 Conver
Slide 24: Loss Absorption Conversion
Loss Absorption Conversion For personal use only Loss Absorption Event › A Loss Absorption Event is each of a Common Equity Capital Trigger Event or a Non-Viability Trigger Event Common Equity › A Common Equity Capital Trigger Event will occur when the Common Equity Tier 1 Capital Ratio as determine
Slide 25: What happens following a Loss Absorption Event
What happens following a Loss Absorption Event For personal use only 5-Business Days Step 1 Step 2 Step 3 A Loss Absorption Ordinary Shares (a) Ordinary Shares can be issued Event occurs issued to Holders Notes Convert to Ordinary Shares as required1 Conversion Face Value Maximum Face Value = Conver
Slide 26: BOQ Capital Position and Loss Absorption Trigger
BOQ Capital Position and Loss Absorption Trigger For personal use only BOQ Capital Position › Capital position of 9.57% ‘unquestionably strong’ › BOQ intend to operate with CET1 above the target range of 9.0-9.5%1 › BOQ Common Equity Tier 1 Capital Ratio is well above the Common Equity Capital Trigg
Slide 27: Comparison of investment in BOQ
Comparison of investment in BOQ For personal use only Standard Term Deposit Capital Notes 2 Capital Notes 3 Ordinary Shares Issuer • BOQ • BOQ • BOQ • BOQ Legal Form • Bank Deposit • Unsecured, subordinated debt • Unsecured, subordinated debt • Ordinary share Maturity • Up to five years • Perpetual
Slide 28: Key Risks Associated with Terms of Capital Notes 3
For personal use only KEY RISKS ASSOCIATED WITH TERMS OF CAPITAL NOTES 3 24 OCTOBER 2022 Bank of Queensland Capital Notes 3 Offer BANK OF QUEENSLAND LIMITED CAPITAL NOTES 3 OFFER 28 This Investor Presentation is intended only for use by Institutional Investors and Syndicate Brokers. Advisers should
Slide 29: Key risks associated with terms of Capital Notes 3
Key risks associated with terms of Capital Notes 3 For personal use only Capital Notes 3 are not deposit › Capital Notes 3 are not deposit liabilities of BOQ, are not protected accounts for the purposes of the Banking Act or any other accounts liabilities or protected accounts with BOQ and are not g
Slide 30: Key risks associated with terms of Capital Notes 3 (con't)
Key risks associated with terms of Capital Notes 3 (con’t) For personal use only It is not certain whether and when › Capital Notes 3 are perpetual and may not be Converted, Redeemed or Resold at all, in which case they may remain on issue Capital Notes 3 may be indefinitely and you may not receive
Slide 31: Key Dates and Key Contacts
For personal use only KEY DATES AND KEY CONTACTS 24 OCTOBER 2022 Bank of Queensland Capital Notes 3 Offer BANK OF QUEENSLAND LIMITED CAPITAL NOTES 3 OFFER 31 This Investor Presentation is intended only for use by Institutional Investors and Syndicate Brokers. Advisers should not use it in advising R
Slide 32: Key dates
Key dates1 For personal use only Key date for the Offer Date Lodgement of the original Prospectus with ASIC 24 October 2022 Bookbuild On or before 31 October 2022 Announcement of the Margin 31 October 2022 Lodgement of replacement Prospectus with ASIC 1 November 2022 Opening Date of the Offer 1 Nove
Slide 33: Key contacts
Key contacts For personal use only Issuer Joint Lead Managers Tim Ledingham, Group Treasurer Tariq Holdich Bank of Queensland Limited ANZ Securities +61 7 3212 3342 +61 2 8037 0622 Steven Wright Morgans +61 7 3334 4941 Stefan Visser National Australia Bank +61 2 7226 8389 Arranger and Joint Lead Man
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