Malayan Banking Bhd. · MYX:MAYBANK

Malayan Banking Bhd — H1 2020 Earnings Presentation

47 slides from Malayan Banking Bhd's earnings presentation, Aug 27, 2020

  1. Slide 1: Investor Presentation: Financial Results 2Q and 1H FY2020

    Investor Presentation Financial Results Second Quarter and First Half FY2020 ended 30 June 2020 27 August 2020 www.maybank.com 0

  2. Slide 2: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 8 Appendix: 1. Financial Performance 20 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 1 Financial Results: 2Q FY2020 and 1H FY2020 ended 30 June 2020

  3. Slide 3: 2Q FY2020 Overview on Macro-Environment and Maybank's Performance

    2Q FY2020 Overview on Macro-Environment and Maybank’s Performance COVID-19 Pandemic Containment Efforts Impact to Maybank Group’s Second Quarter FY2020 Results WHO declares Covid-19 a pandemic on 11 March. Income: Countries close borders and implement  NIM compresses on more rate cuts & net impact

  4. Slide 4: Continued Commitment in Supporting Customers Through the COVID-19 Pandemic

    Continued Commitment in Supporting Customers Through the COVID-19 Pandemic Maybank Group’s Loans Under Moratorium, Relief or R&R Programmes for Three Home Markets Malaysia Continued Repayment Assistance by Maybank, post moratorium % of Outstanding Loan Balance^ as at 14 Aug • With automatic moratori

  5. Slide 5: Leveraging Digital Platforms to Support Transactions During COVID-19 Pandemic

    Leveraging Digital Platforms to Support Transactions During COVID-19 Pandemic New / Enhanced Digital Initiatives • Online application of Repayment Assistance Package (Malaysia) • Opening of business accounts via Maybank2u (Malaysia). 57% of all SME deposit accounts opened in Jun’20 were through STP

  6. Slide 6: Maybank Performance Outlook

    Maybank Performance Outlook Group guidance for remainder of FY2020 • NIM compression guidance widened to 20 bps for FY2020, incorporating latest rate cuts in 2H’2020 and net mod loss impact of RM314 million. • To maintain good quality deposits in local currencies, with strong CASA growth in home mar

  7. Slide 7: Market Outlook

    Market Outlook 2020 industry outlook for our home markets Key Indicators Outlook • The economy is expected to shrink, reflecting the • GDP: -5.4% (2020F) vs 4.3% (2019) impact of the COVID-19 pandemic, domestic • System loan: 2.0% (2020F) vs 3.9% (2019) Movement Control Order (MCO) and drop in crude

  8. Slide 8: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 8 Appendix: 1. Financial Performance 20 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 7 Financial Results: 2Q FY2020 and 1H FY2020 ended 30 June 2020

  9. Slide 9: Maybank Group 1H FY2020 Overview

    Maybank Group 1H FY2020 Overview Stronger net fee based income performance drove Group’s 5.3% YoY revenue growth 1 • Net operating income grew by 5.3% YoY to RM12.37 billion as net fee based income increased by 27.8%, mitigated by lower net fund based income of 3.4% 1H FY2020 • Pre-provisioning oper

  10. Slide 10: P&L Summary: 1H FY2020

    P&L Summary: 1H FY2020 PPOP growth of 9.9% YoY driven by strong net fee based income and flat overhead expenses More 1H 1H 2Q 1Q 2Q details RM million YoY QoQ YoY on FY2020 FY2019 FY2020 FY2020 FY2019 s.22 Net fund based income * 8,184.7 8,473.7 (3.4)% 3,840.3 4,344.5 (11.6)% 4,166.8 (7.8)% s.12/ 13

  11. Slide 11: Net Fund Based Income: 1H FY2020 YoY Trends (1/2)

    Net Fund Based Income: 1H FY2020 YoY Trends (1/2) Continued CASA growth Group-wide with reduction in costlier funds; while Malaysia loan growth in line with industry Group Malaysia Singapore Indonesia Gross Loans (YoY) Community Financial Services Global Banking  (1.0)%  +4.4%  (9.1)%  (14.2)% 3

  12. Slide 12: Net Fund Based Income: 1H FY2020 (2/2)

    Net Fund Based Income: 1H FY2020 (2/2) NIM compresses 18 bps on drastic rate cuts in 1H’2020 and net impact from Day-One modification loss Net Interest Margin (%) QoQ Trend 2.32 2.29 2.19 2.23 5 Year Trend 1.95 2Q '19 3Q '19 4Q '19 1Q '20 2Q '20 2.36 Rate cuts in 1H’2020:  100 bps OPR cut 2.33  3-

  13. Slide 13: Net Fee Based Income: 1H FY2020 (YoY)

    Net Fee Based Income: 1H FY2020 (YoY) Growth driven by realised securities disposal gains and MTM derivatives revaluation gains 1H 1H RM million YoY FY2019 FY2020 Commission, service charges and fees 1,579 1,513  (4.1)% Investment & trading income 645 1,248  93.7% Unrealised gain/ (losses) on fina

  14. Slide 14: Net Fee Based Income: 2Q FY2020 (QoQ)

    Net Fee Based Income: 2Q FY2020 (QoQ) Weaker QoQ fee based income on lower core fees and investment income as well as MTM losses on derivatives 2Q 1Q 2Q RM million QoQ YoY FY2020 FY2020 FY2019 Commission, service charges and fees 693 820  (15.5)% 805  (13.9)% Investment & trading income 479 769 

  15. Slide 15: Overheads: 1H FY2020 (YoY)

    Overheads: 1H FY2020 (YoY) Cost discipline results in flat overheads YoY with CIR of 45.6% and positive JAWs of 5.0% 1H 1H 2Q 1Q 2Q RM million YoY QoQ YoY FY2020 FY2019 FY2020 FY2020 FY2019 Personnel Costs 3,371.0 3,343.6 0.8% 1,644.0 1,727.0 (4.8)% 1,656.6 (0.8)% Establishment Costs 916.4 890.0 3.0

  16. Slide 16: Asset Quality

    Asset Quality Increased provisioning on management overlay while GIL reduces on higher account write-offs Allowances for losses on loans Group Gross Impaired Loans (GIL) Ratio Composition Loan loss coverage incl. Regulatory Reserve Jun Mar Dec Sep Jun GIL Ratio Components Loan loss coverage 2020 202

  17. Slide 17: Asset Quality by Line of Business in Home Markets

    Asset Quality by Line of Business in Home Markets QoQ uptick in Indonesia’s CFS line of businesses as loan outstanding balances contract Consumer Mortgage Auto Finance Credit Cards MBI GIL normalised to 7.98% 3.12% include IFRS 9 impact 5.39% 2.38% 1.88% 4.82% 4.70% 1.27% 1.66% 1.71% 1.77% 4.65% 2.4

  18. Slide 18: Exposure to Oil & Gas and Real Estate Sectors: 30 June 2020

    Exposure to Oil & Gas and Real Estate Sectors: 30 June 2020 Stable QoQ exposure size Group Exposure to Direct & Indirect Oil & Gas Borrowers Real Estate Exposure to Non-Retail Malaysian Borrowers Maybank Group Malaysia Singapore Indonesia Others 2.82% 1.86% 0.68% 0.08% 0.20% High Rise Others, Reside

  19. Slide 19: Strong Liquidity & Capital Positions: 30 June 2020

    Strong Liquidity & Capital Positions: 30 June 2020 Stable LCR at 140.5%, while Group CET1 capital ratio remains strong at 15.43% Liquidity Risk Indicators Capital Positions 19.39% 19.04% LDR LTF LTFE LCR Group 16.49% 16.18% 145.4% 141.5% 141.0% 138.2% 140.5% 15.73% 15.43% Dec 19 Jun 20 95.2% 93.4% 9

  20. Slide 20: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 8 Appendix: 1. Financial Performance 20 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 19Financial Results: 2Q FY2020 and 1H FY2020 ended 30 June 2020

  21. Slide 21: International & Malaysia Portfolio Mix 1H FY2020

    International & Malaysia Portfolio Mix 1H FY2020 Net Operating Income Profit Before Tax¹ Gross Loans* 1H FY2020 (Jan 20 – Jun 20) Overseas: 6.6% Overseas: 8.6% Overseas: 8.2% 35.2% 11.7% 19.2% 10.6% 38.8% 6.9% RM12.37 RM4.05 RM520.2 16.9% billion billion 23.7% billion 61.2% 64.8% 80.8% Malaysia Sing

  22. Slide 22: Segmental Performance of Businesses: 1H FY2020 (1/2)

    Segmental Performance of Businesses: 1H FY2020 (1/2) Net Operating Income 1H FY2019  +5.3% Group Global Banking  +15.0% 1H FY2020 1H FY2019: 4,533 1H FY2020: 5,212 11,750 12,373  (4.8)%  +15.9%  +17.5%  (40.7)%  (8.1)% 6,645 6,326 RM million 3,919 4,542 527 618 936 860 87 52 Total Group Commu

  23. Slide 23: Segmental Performance of Businesses: 1H FY2020 (2/2)

    Segmental Performance of Businesses: 1H FY2020 (2/2) Net Fund Based Income 1H FY2019  (3.4)% Group Global Banking  +2.8% 1H FY2020 1H FY2019: 2,689 1H FY2020: 2,765 8,474 8,185  (3.2)%  +3.5%  (8.9)%  (45.1)%  (0.5)% 5,043 4,879 RM million 2,559 2,648 635 632 127 116 2 1 Total Group Community

  24. Slide 24: Unaudited Income Statement for Insurance and Takaful Business

    Unaudited Income Statement for Insurance and Takaful Business 1H 1H 2Q 1Q 2Q RM million YoY QoQ YoY FY2020 FY2019 FY2020 FY2020 FY2019 Net interest income 631.3 634.3 (0.5)% 315.9 315.4 0.2% 322.0 (1.9)% Net earned premiums 3,685.8 3,250.4 13.4% 1,740.9 1,944.9 (10.5)% 1,623.8 7.2% Other operating i

  25. Slide 25: Group Gross Loans Growth: 30 June 2020

    Group Gross Loans Growth: 30 June 2020 % of 30 Jun 31 Mar 31 Dec YTD 30 Jun QoQ YoY Portfolio 2020 2020 2019 Ann. 2019 Group Gross Loans 520.2 518.4  0.3% 523.5  (1.3)% 525.6  (1.0)% Malaysia (RM billion) 61% 316.1 314.3  0.6% 314.1  1.3% 302.9  4.4% Community Financial Services (reported) 74%

  26. Slide 26: Malaysia Loans Growth: 30 June 2020

    Malaysia Loans Growth: 30 June 2020 % of 30 Jun 31 Mar 31 Dec YTD 30 Jun RM billion QoQ YoY Portfolio 2020 2020 2019 Ann. 2019 Community Financial Services (reported) 74% 234.6 231.7  1.2% 231.3  2.9% 222.2  5.6% Community Financial Services (rebased)¹ 74% 234.6 231.7  1.2% 231.0  3.1% 222.2 

  27. Slide 27: Group Deposits Growth: 30 June 2020

    Group Deposits Growth: 30 June 2020 % of 30 Jun 31 Mar 31 Dec YTD 30 Jun QoQ YoY Portfolio 2020 2020 2019 Ann. 2019 Group Gross Deposits 573.3 543.8  5.4% 565.3  2.9% 560.9  2.2% Malaysia (RM billion) 62% 355.4 336.7  5.6% 351.5  2.2% 351.2  1.2% Savings Deposits 15% 54.5 48.8  11.6% 45.0  4

  28. Slide 28: LDR and CASA Ratio

    LDR and CASA Ratio Group LDR CASA CASA (without IA) Malaysia 93.4% 92.5% 95.2% 93.9% 92.4% 90.6% 90.0% 89.4% 86.9% 87.1% 40.2% 38.4% 34.9% 34.6% 35.5% 44.3% 43.6% 37.5% 37.5% 38.7% 37.3% 35.1% 32.6% 32.5% 33.2% 38.2% 39.7% 33.8% 34.0% 34.9% Jun 19 Sep 19 Dec 19 Mar 20 Jun 20 Jun 19 Sep 19 Dec 19 Mar

  29. Slide 29: RWA Optimisation and Funding Management

    RWA Optimisation and Funding Management Group Gross Loans & Group RWA Funding Breakdown Borrowings and Capital Instruments Operational RWA Market RWA by Currency Credit RWA Gross Loans 525.6 523.5 520.2 389.5 380.4 386.5 FI Deposits, 5% 42.1 43.3 Equity, 11% JPY, IDR, HKD, 6% 42.9 12% 8% SGD, 3% 20.

  30. Slide 30: Key Operating Ratios

    Key Operating Ratios 1H 1H 2Q 1Q 2Q % YoY QoQ YoY FY2020 FY2019 FY2020 FY2020 FY2019 Return on Equity 7.5 9.8 (2.3)% 4.7 10.6 (5.9)% 10.2 (5.5)% Net Interest Margin 2.09 2.24 (15) bps 1.95 2.23 (28) bps 2.19 (24) bps Fee to Income Ratio 33.8 27.9 5.9% 32.0 35.4 (3.4)% 29.3 2.7% Loans-to-Deposit Rati

  31. Slide 31: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 8 Appendix: 1. Financial Performance 20 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 30Financial Results: 2Q FY2020 and 1H FY2020 ended 30 June 2020

  32. Slide 32: Community Financial Services: Overview of Market Share for Malaysia

    Community Financial Services: Overview of Market Share for Malaysia Market share Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 Loans Total consumer (Household) 17.5% 17.6% 17.7% 17.8% 17.9% Auto (Hire Purchase + Block Discounting + Floor Stocking) 28.9% 29.3% 29.6% 29.7% 30.3% Total mortgage * 13.6% 13.7% 14.0

  33. Slide 33: Community Financial Services: Overview of Malaysia Portfolio

    Community Financial Services: Overview of Malaysia Portfolio Total CFS loans on an upward trend of 5.6% YoY and 2.9% Total CFS deposits increased by 7.5% YoY driven by CASA YTD Ann. growth of 18.9%  +7.5% YoY  +5.6% YoY  +9.5% YTD Ann.  +2.9% YTD Ann. 222.2 231.3 234.6 199.1 204.3 214.0 42.7 44.

  34. Slide 34: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 8 Appendix: 1. Financial Performance 20 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 33Financial Results: 2Q FY2020 and 1H FY2020 ended 30 June 2020

  35. Slide 35: Global Banking: Overview of Malaysia Corporate Banking and Group Securities Portfolio

    Global Banking: Overview of Malaysia Corporate Banking and Group Securities Portfolio Total Corporate Banking loans in Malaysia increased 0.7% Group Securities Portfolio¹ grew 4.7% YoY YoY to RM81.0 billion RM billion  +4.7% YoY 48.5 Term Loan 46.7  +6.3%YoY 204.1 45.7 194.9 202.4 192.8 189.5 5.9

  36. Slide 36: Global Banking: Overview of Group Investment Banking Portfolio

    Global Banking: Overview of Group Investment Banking Portfolio 1H FY2020 Total Income Breakdown by Country 1H FY2020 Fee-based Income for Malaysia Hong Kong Others Arranger Fees Underwriting & Placement 4% 5% Philippines 8% Fees 1% 2% Indonesia 4% Advisory Fees Malaysia 2% Thailand 42% 16% RM618.5 m

  37. Slide 37: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 8 Appendix: 1. Financial Performance 20 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 36Financial Results: 2Q FY2020 and 1H FY2020 ended 30 June 2020

  38. Slide 38: Maybank Singapore: P&L Summary

    Maybank Singapore: P&L Summary SGD million 1H FY2020 1H FY2019 YoY 2Q FY2020 1Q FY2020 QoQ Net fund based income 313.24 383.61 (18.3)% 142.84 170.40 (16.2)% Net fee based income 189.88 161.75 17.4% 85.48 104.40 (18.1)% Net income 503.12 545.36 (7.7)% 228.32 274.80 (16.9)% Overhead expenses (236.63)

  39. Slide 39: Maybank Singapore: Overview of Loans and Deposits Portfolio

    Maybank Singapore: Overview of Loans and Deposits Portfolio Diversified Loan Portfolio Consumer deposits made up 54% of total deposits % of 30 Jun 31 Dec YTD 30 Jun  +7.0% YoY SGD Billion YoY Portfolio 2020 2019 Ann. 2019 45.6 48.3 48.8 Consumer - Time Deposits CFS 56% 21.8 22.1 (3.3)% 22.9 (4.8)%

  40. Slide 40: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 8 Appendix: 1. Financial Performance 20 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 39Financial Results: 2Q FY2020 and 1H FY2020 ended 30 June 2020

  41. Slide 41: Maybank Indonesia: P&L Summary

    Maybank Indonesia: P&L Summary 1H 1H 2Q 1Q IDR billion YoY QoQ FY2020 FY2019 FY2020 FY2020 Net Fund Based income 3,936 4,024 (2.2)% 1,912 2,024 (5.5)% Net Fee Based income 1,184 1,167 1.4% 586 598 (2.0)% Net income 5,119 5,191 (1.4)% 2,498 2,622 (4.7)% Overhead expenses (3,036) (3,183) (4.6)% (1,432

  42. Slide 42: Maybank Indonesia: Financial Ratios and Loans Portfolio Breakdown

    Maybank Indonesia: Financial Ratios and Loans Portfolio Breakdown Key Operating Ratios Loans Portfolio Breakdown % of 30 Jun 31 Mar 30 Jun Key Operating Ratio Jun-20 Dec-19 Jun-19 YoY IDR Trillion QoQ YoY Portfolio 2020 2020 2019 Profitability & Efficiency CFS 69% 79.9 87.7 (8.9)% 97.6 (18.1)% Retur

  43. Slide 43: Table of Contents

    Table of Contents Executive Summary 2 Results Overview 8 Appendix: 1. Financial Performance 20 2. Community Financial Services 31 3. Global Banking 34 4. Maybank Singapore 37 5. Maybank Indonesia 40 6. Other Segments 43 42Financial Results: 2Q FY2020 and 1H FY2020 ended 30 June 2020

  44. Slide 44: Islamic Banking: Performance Overview

    Islamic Banking: Performance Overview Group Islamic Banking Financial Performance Maybank Islamic: Total Gross Financing grew to RM196.5 billion RM million 1H FY2020 1H FY2019 YoY Jun-19 14% Jun-20 Total Income 2,303.0 2,395.8 (3.9)% 57.4 50.3 6% Profit Before Tax 758.3 1,602.3 (52.7)% 8% 40.9 43

  45. Slide 45: Islamic Banking: Market Share

    Islamic Banking: Market Share Maybank Islamic Market Share Market Share by Product (Malaysia) 31.0% 31.2% 31.1% 30.9% 30.7% Key Products Jun 20 Jun 19 Automobile Financing 48.6% 46.5% 28.7% 28.3% 27.8% 27.6% 27.9% Home 26.8% 26.3% Term financing 28.2% 28.3% Jun 19 Sep 19 Dec 19 Mar 20 Jun 20 Financi

  46. Slide 46: Insurance and Takaful: Performance Overview

    Insurance and Takaful: Performance Overview Net Adjusted Premium/Contribution Life & Family (New Business) Market Share (Malaysia) Single Premium  161.0% 22.1% 21.9% 18.6% 19.5% Regular Premium  4.7% No. 4 in 14.2% 13.0% 16.5% 17.2% Life/Family (29.6)% 1H FY2020  Credit Premium (New Business) 14.

  47. Slide 47: Humanising Financial Services

    Humanising Financial Services MALAYAN BANKING BERHAD 14th Floor, Menara Maybank 100, Jalan Tun Perak 50050 Kuala Lumpur, Malaysia Tel : (6)03-2070 8833 www.maybank.com Disclaimer. This presentation has been prepared by Malayan Banking Berhad (the “Company”) for information purposes only and does not

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