Wema Bank Plc · NSENG:WEMABANK
Wema Bank — FY2014 Earnings Presentation
28 slides from Wema Bank's earnings presentation, 2015
Slide 1: Financial Year 2014 Result: Facts and Figures
FINANCIAL YEAR 2014 RESULT Facts and Figures
Slide 2: Cautionary Note Regarding Forward Looking Statements
Cautionary Note Regarding Forward Looking Statements • This presentation contains or incorporates by reference “forward-looking statements” regarding the belief or current expectations of Wema Bank Plc, the Directors and other members of its senior management about the Bank’s businesses and the tran
Slide 3: Agenda
section page 1 Overview of the Bank 4 2 Financial Highlights 10 3 Outlook 24 3
Slide 4: The Bank at a Glance
The Bank at a Glance Wema Bank Plc Listed on the Nigerian Incorporated in Nigeria in 1945 Stock Exchange in February 1991 Authorized capital of N20billion divided into 40 billion ordinary shares Diverse Shareholder Fully paid up share capital is N19,287,233,041 divided into 38,574,466,082 ordinary B
Slide 5: The Bank has been Transformed
The Bank has been Transformed The turnaround plan which commenced in 2009 has been implemented …Together to greater heights …People banking on People 2009 2010 - 2012 2014 Negative Capital position Threshold Capital Sufficient Capital (N45billion) N44billion in Shareholders’ funds Distressed bank Re
Slide 6: A New WEMA has Evolved
A New WEMA has Evolved 2015 Improved Corporate Governance Sufficient Capital Target Market – (N44billion in Shareholders’ Retail & SME funds) Modern Processes Fully capitalized (CAR of 22%) Improved Capital Position (18% Cutting-edge CBA 1.5% of Market Share CAR) Executed Retail Strategy N44 billion
Slide 7: Updates on 2014 Commitments
Updates on 2014 Commitments MOTIVE TASK Growing Business Consistent Deposit growth during the year (Customer Deposit growth of 17%) Increasing lending to productive sectors (Year-on-year Loan growth >30%) Growing top line earnings by gradual portfolio shift from money market investments
Slide 8: Section Page: Financial Highlights
Section Page 1 Overview of the Bank 4 2 Financial Highlights 10 3 Outlook 24 8
Slide 9: Financial Highlights
Financial Highlights 2014 FY 2013 FY PBT ₦3.1bn ₦1.9bn Financial PAT ₦2.1bn ₦1.5bn Highlights Capital Adequacy Ratio 18% 27% EPS (Adjusted) 6k 8k Deposits ₦258.96bn ₦217.73bn Loan book (Net) ₦149.29bn ₦98.63bn Revenue Generation Interest Income ₦35.5bn ₦28.5bn Non Interest Income ₦6.7bn ₦7.1bn Cost
Slide 10: Statements of P&L and other Comprehensive Income and the Financial Position
Statements of P&L and other Comprehensive Income and the Financial Position In millions of Nigerian Naira 2014 2013 In millions of Nigerian Naira 2014 2013 Assets Interest income 35,453 28,542 Cash and cash equivalents 52,130 31,314 Interest expense (16,901) (16,018) Restricted deposits with CBN 70,
Slide 11: Earnings & Profitability Trends
Earnings & Profitability Trends Annualized Gross Earnings Cost to Income Ratio 45 40 151.34 35 142.56 129.88 30 ₦'million 25 95.15 20 87.72 15 10 5 - 2010 2011 2012 2013 2014 2010 2011 2012 2013 2014 • Gross earnings increased by 19.90% between 2013 and 2014 • PBT - ₦3.1billion in 2014 compared to ₦
Slide 12: Improved revenue base in 2014
Improved revenue base in 2014 Interest Income Interest Income 25 20 ₦'million 15 10 Non-Interest Income 5 Non Interest Income 2014 2013 0 Retail fees & commissions 2,101 2,168 Cash and Loans and Investment equivalents advances securities Corporate fees & commission 2,506 2,048 Other fees and charges
Slide 13: Continuous efforts in cost-reduction strategies
Continuous efforts in cost-reduction strategies... Interest Expenses INTEREST EXPENSES (N'000) 20,000 15,000 10,000 Interest Expenses increased by 5.52% between 5,000 FY2013 and FY2014. 0 2014 2013 Total Operating Expenses Deposits from banks Deposits from customers Other borrowed funds OPERATING EX
Slide 14: Liabilities Structure
Liabilities Structure Liabilities LIABILITIES STRUCTURE 2014 2013 300 ₦'billion ₦'billion Deposits from banks 3.2 3.4 250 Deposits from customers 259.0 217.7 Deriv. financial liabilities 0.4 - 200 Current tax liabilities 0.3 0.4 150 Other liabilities 17.1 10.1 Other borrowed funds 58.4 57.6 100 Obli
Slide 15: Deposit by Type & Mix - 2013 & 2014
Deposit by Type & Mix - 2013 & 2014 Deposit Mix • Deposit liabilities continue 2014 2013 to grow year on year. Savings 12% Savings 15% • Initial impact of PSG CRR was a spike in effective Term cost of funds and decline Term Deposits in yields; however the Deposits 40% 44% gradual rebasing has Curren
Slide 16: Loans by Type & Category - 2013 & 2014
Loans by Type & Category - 2013 & 2014 LOANS & ADVANCES TO CUSTOMERS Declining NPLs 84.0% 160 140 120 billions 100 80 60 40 15.0% 14.0% 20 3.9% 2.49% - 2010 2011 2012 2013 2014 2010 2011 2012 2013 2014 Gross Loan by Type 2014 2013 2014 2013 ₦’million ₦’million Consumer Consumer Banking Banking 9% Co
Slide 17: Credit Portfolio Analysis
Credit Portfolio Analysis BREAKDOWN OF CREDIT PORTFOLIO NPL BREAKDOWN COMMERCIAL PROPERTY STEEL ROLLING TELECOMMUNIC 6% 6% ATIONS 7% ALUMINIUN SPECIALIZED AND ALLIED OTHERS CONSTRUCTN PRODUCTS 22% ACTIVITIES 13% 9% DOMESTIC POWER TRADE HOTEL AND GEN/ DOMESTIC 12% LEISURE REAL ESTATE TRADE POWER 4% C
Slide 18: Year on year improvement in Balance sheet trends
Year on year improvement in Balance sheet trends TOTAL ASSETS TOTAL DEPOSITS 450 300 400 350 250 300 200 250 150 200 150 100 100 billions 50 Billions 50 - 0 2010 2011 2012 2013 2014 2011 2012 2013 2014 EQUITY LOANS & ADVANCES 50 160 140 40 120 100 30 80 20 60 40 10 billions 20 billions - - 2010 2011
Slide 19: Managing Risk in Wema Bank
Managing Risk in Wema Bank The Bank has continued to improve its business despite the changing risk universe Challenging macroeconomic conditions • The Bank continues to stress test its portfolio for various economic scenarios and make necessary improvements in risk framework Tightening regulation •
Slide 20: Risk Management Metrics
Risk Management Metrics 2010 2011 2012 2013 2014 Gross Risk Assets (₦'billion) 70.60 70.10 83.70 102.70 152.70 NPL (₦'billion) 37.40 9.70 11.89 3.98 3.79 Provisions for Loan Loss (₦'billion) 32.00 10.00 9.10 3.98 3.79 NPL Ratio (%) 52.97 13.83 14.20 3.87 2.49 NPL Coverage Ratio (%) 85.56 103.09 76.5
Slide 21: Key Performance Metrics
Key Performance Metrics 2010 2011 2012 2013 2014 Net Interest Margin (%) 3.72 6.72 6.44 7.01 8.27 Cost of Funds (%) 3.12 3.07 5.42 5.87 5.21 Loan-to-Deposit Ratio (%) 31.80 40.81 42.31 47.02 57.65 Capital Adequacy Ratio (%) -13.89 -13.50 -16.00 27.00 18.22 Liquidity Ratio (%) 87.00 64.0 64.53 76.61
Slide 22: Section Page: Outlook
Section Page 1 Overview of the Bank 4 2 Financial Highlights 10 3 Outlook 24 22
Slide 23: Outlook for the Nigerian Economy in 2015
Outlook for the Nigerian Economy in 2015 Weakening Outcome of the Implementation Administration Exchange 2015 General of the Reform of the 2015 Rates Elections Agenda Budget Dampened Diversification Global of the Economy All- Declining Growth Forecasts Inclusive Oil Prices Growth Passage of the Comp
Slide 24: Wema Bank Growth Plan – Project LEAP
Wema Bank Growth Plan – “Project LEAP” The Bank is on track for executing the Project LEAP transformation plan (2013 – 2015). Overarching Goal To Efficiently Grow Market Share in Retail & SME Target Markets IMPROVING EFFICIENCY GROWING MARKET SHARE IMPROVE NETWORK SPREAD • Participate in high-yield
Slide 25: 2015 Expectations
2015 EXPECTATIONS Low cost • Improve growth in retail deposits to keep cost of funds low. funding • Leveraging mobile solutions and technology as our competitive edge • Improve cost‐to‐income ratio (75-80%) • Continue to drive retail deposits, technology, innovation to keep Efficiency costs low • Fi
Slide 26: Appendices
‘Sy Wema Bank Appendices ..People Banking on People
Slide 27: Experienced, Skilled and Diverse Board
Experienced, Skilled and Diverse Board • Two Independent Directors • Varied experience from Banking, Industry, Law and other relevant sectors • Implementing strong governance and risk controls 1 2 3 4 5 6 7 8 9 10 11 12 13 14 1. Adeyinka Asekun (Chairman) 6. Wole Akinleye (ED) 11. Tina Vukor-Quarshi
Slide 28: Draw a Purple Line today
Draw a Purple Line today and Experience the touch of Great Relationships.