Burgan Bank · KSE:BURG
Burgan Bank — FY2020 Earnings Presentation
14 slides from Burgan Bank's earnings presentation, February 2021
Slide 1: Burgan Bank Group Investor Presentation FY 2020 Financial Results
BURGAN BANK GROUP INVESTOR PRESENTATION FY 2020 FINANCIAL RESULTS FEBRUARY 2021
Slide 2: Table of Contents
TABLE OF CONTENTS Contents Page Key Focus Areas in FY’20 3 FY’20 Performance Highlights 4 Key P&L Metrics 5-6 Asset Quality 7 Key Balance Sheet & Liquidity Metrics 8-9 Capital Level 10 FY’20 Performance by Entities 11 Summary 12 2
Slide 3: Key Focus Areas in FY'20
KEY FOCUS AREAS IN FY’20 1 Swift Transition to “New Normal” 2 Digital Initiatives Fast-tracked 3 Finalizing Exit from Iraq 3
Slide 4: FY'20 Performance Highlights
FY’20 PERFORMANCE HIGHLIGHTS Resilient Top-line ▪ Net-Interest income impacted by rate cuts ▪ Non-interest income (excl one-offs) : +7% y-o-y Lower Operating Costs ▪ Expenses lower by KD 5mn y-o-y ▪ Reduction in non-critical expenses; continued investment in Digital Growth Led by Kuwait ▪ Loans: Kuw
Slide 5: Revenue & Operating Expenses
REVENUE & OPERATING EXPENSES Revenue & Margins(1) | KD mn, % Operating Exp. & Cost-to-Income Ratio(2) | KD mn, % 2.9% 2.7% 45.7% 42.1% 41.2% 2.3% 265 24 248 16 213 112 57 3 102 65 97 69 241 232 209 184 167 140 FY'18 FY'19 FY'20 FY'18 FY'19 FY'20 Normalized Revenue Net-Interest Income Normalized Non-
Slide 6: Operating Profit & Net Income
OPERATING PROFIT & NET INCOME Operating Profit | KD mn Net Income(1) & Dividend Payout Ratio (2) | KD mn, % 52.7% 154 146 44.1% 24 16 38.7% 116 3 83 85 16 129 130 24 112 34 69 3 58 30 FY'18 FY'19 FY'20 FY'18 FY'19 FY'20 Normalized Net Income One-offs^ Normalized Operating Profits One-offs^ Dividend
Slide 7: Asset Quality
ASSET QUALITY Provisions(1) | KD mn Cost of Credit (CoC)(2) | % 1.7% 76 1.4% 62 17 1.1% 49 19 4 1.1% 0.8% 59 44 45 0.5% FY'18 FY'19 FY'20 FY'18 FY'19 FY'20 Loan Provisions Precautionary Provision CoC - Kuwait CoC - Group NPLs (KD mn) & Coverage(3) (%) NPL Ratio (%) 339.1% 330.7% 222.9% 4.2% 132.5% 1
Slide 8: Assets & Loans
ASSETS & LOANS Total Assets(1) | KD mn Asset Composition – FY’20 | % 7,312 7,081 7,106 8% 7% 277 287 244 9% 2,124 1,876 1,839 15% 5,552 5,528 5,569 61% (2) Loans Cash Others Investments Due from Banks & OFIs FY'18 FY'19 FY'20 Kuwait International (ex BoB) BoB Consol Adj Customer Loans(1) | KD mn Cus
Slide 9: Deposits & Liquidity Metrics
DEPOSITS & LIQUIDITY METRICS Customer Deposits (1) | KD mn, % Deposits by Type – FY’20 | % 3,991 4,091 3,768 4% 198 1,141 1,113 1,183 31% 66% 2,850 2,979 2,387 CASA Time Other FY'18 FY'19 FY'20 Kuwait International (ex BoB) BoB^ Cost of Funds | % Regulatory Liquidity Metrics(2) | % 207.7% 175.5% 3.3
Slide 10: Capital Levels
CAPITAL LEVELS Regulatory Capital | KD mn, % 18.1% 2,500 17.4% 16.8% 16.0% 14.0% 11.9% 2,000 11.5% 11.5% 11.0% 10.5% 10.5% 1,500 8.0% 6.0% 1,143 1,001 1,033 329 1,000 170 175 1.0% 146 153 153 500 -4.0% 686 705 661 - -9.0% FY'18 FY'19 FY'20 5,759 6,134 6,306 CET1 AT1 Tier II CET 1 Ratio CAR Ratio Min
Slide 11: Performance Comparison (Kuwait vs. International Ops)
PERFORMANCE COMPARISON (KUWAIT VS. INTERNATIONAL OPS) BB KUWAIT(1) INTERNATIONAL OPS FY’20 FY’19 FY’18 FY’20 FY’19 FY’18 Revenues 125 176 165 104 102 115 Key P&L Items | KD mn Expenses 44 49 55 47 45 53 Provisions(2) 29 15 34 49 34 29 Net Income (3) 50 107 73 3 12 24 NIMs (4) 1.6% 2.1% 2.3% 4.3% 4.5
Slide 12: In Conclusion
IN CONCLUSION FY’20 results impacted largely by low rates environment in Kuwait, higher credit costs in Turkey & precautionary provisioning Looking ahead, Burgan will continue to accelerate its digital transformation plans and complete its exit from Iraq upon receipt of approvals 12
Slide 13: Thank You
Thank You =H ul Lo OL... 9 js Sms ‘79 BURGAN BANK
Slide 14: Disclaimers
DISCLAIMERS IMPORTANT NOTICE This presentation has been prepared by Burgan Bank K.P.S.C. and is subject to the applicable laws and regulations in the State of Kuwait. It is for information purposes only and it shall not be reproduced or redistributed to any other person without obtaining Burgan Bank