United Arab Bank · ADX:UAB
United Arab Bank — 9M 2023 Earnings Presentation
18 slides from United Arab Bank's earnings presentation, Oct 24, 2023
Slide 1: Growth momentum continues at UAB
Growth momentum continues at UAB 9M’23 Earnings presentation 24 October 2023
Slide 2: Growth momentum continues at UAB
Growth momentum continues at UAB Delivering growth in net profits quarter on quarter, … AED Mn • Execution of turnaround strategy progressing well 88 209 • Delivering growth in profitability and enhancing shareholder returns 66 53 55 • Capitalising on the favourable environment, whilst 119 maintaini
Slide 3: Higher profitability driven by increase in operating income, amid focus on quality of assets
Higher profitability driven by increase in operating income, amid focus on quality of assets Net profit growth driven by higher operating … while maintaining cost discipline and focus on Income statement highlights (AED Million) income across core business, … quality of assets 9M'23 ∆YoY% 3Q'23 ∆QoQ
Slide 4: Operating income growth driven by NII benefitting from higher interest rates and gain on sale of fixed assets
Operating income growth driven by NII benefitting from higher interest rates and gain on sale of fixed assets Operating income: both, NII and non-interest income, grew year-on-year in double-digits Higher interest rates and efficient management of funding costs lead to AED Mn higher NIM NII: +2% qoq
Slide 5: Higher expenses reflect business growth, albeit lower CI ratio on positive operating leverage
Higher expenses reflect business growth, albeit lower CI ratio on positive operating leverage Efficiently managing expenses, albeit investing across people, products and systems, in line with medium-term growth strategy CI Ratio (%) Delivering positive operating leverage (JAWS1) 63 52 53 47 +27% +49
Slide 6: Focus on quality of assets has resulted in significant improvement across metrics
Focus on quality of assets has resulted in significant improvement across metrics Continue to prudently manage risk and maintain focus on improving and preserving good asset quality Cost of risk and impairment charges stabilising .. … with decline in non-performing loans and enhanced coverage Covera
Slide 7: Solid financial position laying the foundation for continued growth
Solid financial position laying the foundation for continued growth Robust foundation with a solid capital position and adequate liquidity; business pipelines across the various Balance Sheet highlights (AED Billion) segments look healthy and are now beginning to convert, translating into robust top
Slide 8: Strengthened capital position through AT1 issuance and profit generation
Strengthened capital position through AT1 issuance and profit generation Strong organic capital generation & issuance of AT1 in Q1’23 strengthens capital Delivering enhanced returns to shareholders position RoSE% (Ytd) 17.8 +187bps -90bps 14.7 15.7 -41bps 13.9% 11.0 10.3 13.3% CET: +55bps RoA% (Ytd)
Slide 9: Well-positioned for the growth ahead
Summary Cautiously optimistic on the macroeconomic outlook: • positive GDP growth, further picking up pace in 20241 • expectations of ‘higher for longer’ interest rates and its potential impact on client demand and their creditworthiness Solid foundation: maintaining our focus on quality of assets,
Slide 10: Appendix
Appendix
Slide 11: Traditional and conservative mix of assets and liabilities
Traditional and conservative mix of assets and liabilities Assets primarily deployed across loans and high-quality investments … … funded by customer deposits as the major source AED Bn FY’22 9M’23 AED Bn FY’22 9M’23 Cash & balances with CB 1.2 1.4 Due to banks 3.3 2.8 2% 5% 9% 4% 4% 22% Due from ba
Slide 12: Loan book growth being managed prudently with focus on quality and client relationship
Loan book growth being managed prudently with focus on quality and client relationship Loan book growth being managed prudently; pipeline looks healthy across businesses Lending predominantly corporate led, with significant scope to expand into retail AED Bn AED Bn FY’22 9M’23 +2% qoq, -1% yoy, +1%
Slide 13: Quality investment portfolio mandated to meet liquidity requirements and enhance yield
Quality investment portfolio mandated to meet liquidity requirements and enhance yield Investments book primarily consist of debt instruments, majority marked-to-market AED Bn FY’22 9M’23 25% Debt - Amortised cost 0.8 1.2 21% Debt - FVOCI 3.1 3.5 79% 75% Equity - FVOCI 0.001 0.001 TOTAL INVESTMENTS
Slide 14: Strong growth in customer deposits driven by increase in CASA
Strong growth in customer deposits driven by increase in CASA Strong growth in customer deposits Healthy CASA deposits growth on the back of various initiatives +1% qoq, ↔ yoy, +1% ytd AED Bn CASA AED Bn +2% qoq, +19% yoy, +9% ytd CASA% 36% 35% 39% 36% 9.2 9.2 31% 8.6 8.3 8.4 3.1 3.3 3.3 2.8 2.9 9M'
Slide 15: Summary financials – Income statement and Balance sheet
Summary financials – Income statement and Balance sheet Income statement highlights (AED Million) 9M'23 9M'22 ∆YoY% 3Q'23 2Q'23 3Q'22 ∆QoQ% ∆YoY% Net Interest Income 295 224 31 102 100 83 2 23 Non-Interest Income 152 127 20 72 50 25 45 188 Total Income 447 351 27 174 150 108 16 61 Operating Expenses
Slide 16: Summary financials – Key ratios
Summary financials – Key ratios Key Ratios (%) 9M'23 9M'22 ∆YoY (bps) 3Q'23 2Q'23 3Q'22 ∆QoQ (bps) ∆YoY (bps) Net Interest Margin (NIM) 3.16 2.39 77 3.17 3.22 2.63 (5) 54 Cost-Income ratio 47.1 52.4 (528) 43.8 45.8 62.7 (205) (1,892) Cost of Risk (CoR) 0.41 0.76 (35) 0.49 0.83 0.11 (34) 38 Return on
Slide 17: Disclaimer
Disclaimer • Comparative figures have been reclassified where appropriate to conform to the presentation and accounting policies adopted in the financial statements • Please note that rounding differences may appear throughout the presentation • The information contained herein has been prepared by
Slide 18: United Arab Bank
UNITED ARAB BANK 1975 OOO0OG auabuae | @uabae | @ 800474