Meezan Bank Limited. · PSX:MEBL
Meezan Bank — Q1 2023 Earnings Presentation
39 slides from Meezan Bank's earnings presentation, March 2023
Slide 1: Q1 2023 Results
Q1 2023 Results x ERX eS a) 3 aa wad yY iF: Sen 4Q x Laer Y > = — ion als Meezan Bank € The Premier Islamic Bank \} |
Slide 2: Index
Index S.No Table of Content Slide # 1 Islamic Finance Industry 3-6 2 Company Overview 7-27 3 Our Digital Footprint 28-32 4 Investment Opportunity & Strategic Priorities 33-34 5 Appendix 35-40 2
Slide 3: Islamic Finance Industry
Islamic Finance Industry 3
Slide 4: Pakistan Islamic Banking Industry
Pakistan Islamic Banking Industry Islamic banking assets reached Rs 7.2 Trillion by the end of 2022 : SBP According to Fitch Ratings (US-based credit rating agency), Islamic finance industry in Pakistan is expected to continue its growth trajectory over the medium term, driven by strong government p
Slide 5: Key Performance Indicators - Deposits
Key Performance Indicators - Deposits Rs in Bn MEEZAN SHARE OF IBI Bank's Growth in Comparison with Islamic Banking Industry 6,0 00 44% The Pie Grows Bigger and Bigger 40% Every Year 5,0 00 36% 32% 4,0 00 31% 32% 28% 3,0 00 24% 20% 2,0 00 16% 37% 12% 1,0 00 8% 0 4% 2017 2018 2019 2020 2021 2022 Meez
Slide 6: Islamic Banking vs Total Banking Industry of Pakistan
Islamic Banking vs Total Banking Industry of Pakistan 22% 20.2% Deposits Meezan Share Assets Meezan Share Meezan Bank: Rs. 1.66 Trn Meezan Bank: Rs. 2.6 Trn Total: 7.1% Total: 7.2% Islamic Banks: Rs. 5.2 Trn Islamic Banks: Rs. 7.2 Trn IB: 32.1% IB: 35.7% Conventional Banks: Rs. 18.3 Trn Conventional
Slide 7: Company Overview
Company Overview 7
Slide 8: Meezan Bank Current Standing
Meezan Bank Current Standing Founded with the Vision to ‘establish Islamic banking as banking of first choice…’, the Bank commenced operations in 1997 as Al Meezan Investment Bank Limited. It converted to Meezan Bank Limited, a full-fledged Islamic commercial bank in 2002, when the State Bank of Pak
Slide 9: Awards and Recognitions
Awards and Recognitions —{n LUI PAKISTAN BANKING AWARDS ‘THE INSTITUTE OF BANKERS PAKISTAN IFFSA ae Gl HAS? GLOBAL ISLAMIC FINANCE AWARDS Ny CFASociety Tye astAN BANKER’ TheBanker KS Pakistan —_ sme ninarenisemcrrornrinacar sects comuwy a ) PAKISTAN = WN 8 soe STOCK EXCHANGE a LIMITED %, mAssets & +
Slide 10: Performance Overview – Mar 2023 Headlines
Performance Overview – Mar 2023 Headlines 68% 5% vs Dec Basic Earnings Per Share YoY Rs.15.4 billion Rs.2.7 Plus trillion Rs.8.62 per share 8% vs Dec ADR Return on Equity Rs. 1.79 trillion 59% 50% Plus 10 vs Dec 7 vs Dec New Branches New Cities Distribution to Shareholders 972 324 30% Cash 10
Slide 11: Performance Overview – Mar 2023 Headlines
Performance Overview – Mar 2023 Headlines Q1 2023 Q1 2022 Growth Profit After Tax Rs 15.4 billion Rs 9.2 billion 68% Gross Financings Rs 1.05 Trillion Rs 759 billion 38% Deposits Rs 1.79 Trillion Rs 1.46 Trillion 23% Gross ADR 59% 52% 13% CASA Mix 88% 82% 6% Return on Equity 52.6% 42.3% 10% CAR 18.8
Slide 12: 68% Growth in PAT- Despite Higher Tax Charge of 43%
68% Growth in PAT- Despite Higher Tax Charge of 43% (Unconsolidated) Rs in mn Profit & Loss Account Q1 2023 Q1 2022 Growth % Q4 2022 Growth % Average Policy Rate 17.71% 9.75% 82% 15.39% 15% Return on financings, investments and placements 81,953 38,111 115% 78,242 5% Return on deposits and other due
Slide 13: Key Performance Indicators - Profitability
Key Performance Indicators - Profitability Rs in bn Full Year Profit After Tax 2011 - 2023 45.0 Last three years average growth in PAT 44% (2019 – 2022) US $159 mn 28.4 22.2 US $100 mn 15.2 6.3 9.0 3.5 4.0 4.6 5.0 5.6 15.4 3.4 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Mar-23 Actual
Slide 14: Key Ratios
Key Ratios ROE - % ROA - % 52.6% 2.4% 44.6% 2.0% 36.4% 1.7% 1.7% 34.6% 1.5% 30.7% 23.8% 1.0% 0.9% 0.9% 19.6% 19.3% 2016 2017 2018 2019 2020 2021 2022 Mar-23 2016 2017 2018 2019 2020 2021 2022 Mar-23 Income Efficiency Ratio - % Gross ADR - % 66.5% 64.3% 62.9% 61.0% 59.3% 57.1% 58.6% 54.3% 53.4% 55.2%
Slide 15: 28% Growth in Assets Since Mar 2022
28% Growth in Assets Since Mar 2022 - Led by Higher Financings & Investments (Unconsolidated) Rs in mn Balance Sheet Mar 2023 Mar 2022 Growth Dec 2022 Growth Islamic Financing and related assets - Gross 1,049,226 758,582 290,644 38% 1,018,102 31,124 3% Less: Provisions (24,757) (19,237) (5,520) (29%
Slide 16: Key Performance Indicators - Deposits
Key Performance Indicators - Deposits Rs in mn 1,791 Deposit Growth Since Inception 1,658 Market Share of Deposits 7.2% (Mar’23) 1,456 CAGR Since Inception 34% (Dec’22) 1,254 933 785 667 559 468 379 230 288 131 169 34 55 70 100 5 8 14 23 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20
Slide 17: Key Performance Indicators - Deposits
Key Performance Indicators - Deposits Mar 2023 Mar 2022 Growth Rs in bn Mix Rs in bn Mix Rs in bn % CA Deposits Grew by 37% CA 918 51% 672 46% 246 37% SA 650 37% 524 36% 126 24% CASA 1,568 88% 1,196 82% 372 31% TD 223 12% 260 18% (37) (14%) Total 1,791 100% 1,456 100% 335 23% Mar 2023 TD, 12% Mar 20
Slide 18: Key Performance Indicators - Financing
Key Performance Indicators - Financing Rs in Bn Gross Financing & Infection Ratio Strong NPL Coverage Ratio 166% 161% 1,049 30 180 % 3.0 % Mar 2023: Financing Market Share 8.7% 2.8% 139% 142% 160 % 2.5 % 25 133% 128% 133% 1,018 118% 25 140 % 2.1% 2.0 % 20 23 120 % 1.8% 1.9% 19 19 100 % 1.5% 777 1.5%
Slide 19: Key Performance Indicators – Investment
Key Performance Indicators – Investment Rs 1.3 Trillion Up by 38% Investment Mix Investments (Rs in Bn) Mar 2023 Mar 2022 Var. Rs 1.1 tn 85% GIS Rs 749 bn 81% GoP Ijarah Sukuk (GIS) 1,098 749 47% Rs 164 bn 13% PES Energy Sukuk & Other Govt. (PES) 164 152 8% Rs 152 bn 16% Others (Shares , Corp sukuk
Slide 20: Key Ratios
Key Ratios Capital Adequacy Ratio % CAR 17.8% 18.4% 18.9% 17.8% 16.6% 14.5% 6.4% 6.9% Excess 12.9% 12.9% 4.1% 6.3% 6.3% 2.6% Additional 2.3% 1.6% 0.5% 0.5% D-SIB 11.3% 11.9% 12.5% 11.5% 11.5% 11.5% 11.5% 10.7% Minimum Required 2016 2017 2018 2019 2020 2021 2022 Mar-23 Min Req. reduced to 11.5% durin
Slide 21: Branch Network Coverage Across Pakistan
Branch Network Coverage Across Pakistan 972 branches in 324 cities 03 As at March 31, 2023 Gilgit Baltistan 72 02 Sindh: 283 Branches KPK Punjab: 566 Branches 81 Baluchistan : 39 Branches 09 KPK: 72 Branches AJK Gilgit Baltistan: 03 Branches 08 AJK : 09 Branches 566 Punjab 627 39 Baluchistan 34 283
Slide 22: 23% Growth in Fee and Commission
23% Growth in Fee and Commission Rs in mn Fee, commission and other income Mar 2023 Mar 2022 Growth % Debit card related fees 1,684 1,213 39% Trade related fees & guarantee commissions 893 942 (5%) Branch banking fees 581 544 7% Investment banking fees 91 85 7% Home remittance fees 59 73 (19%) Cash
Slide 23: Trade Business Volume Contracted by 14%
Trade Business Volume Contracted by 14% Due to Ongoing Economic Conditions Rs in Bn Mar 2022 Mar 2023 302 225 Rs 459 billion 171 Rs 396 billion 157 Import Export Import Export 24
Slide 24: Al-Meezan Investment Management Ltd
Al-Meezan Investment Management Ltd (Meezan Bank’s subsidiary) Al Meezan Investment Management (AMIM) has a vision… to make Shariah Compliant Investing a first choice for investors. Having a diverse clientele base of over 192,000 investors, ranging from institutions and businesses to individuals and
Slide 25: Al-Meezan - Products
Al-Meezan - Products 1. Mutual Funds 2. Savings Plan 3. Retirement Plans 4. Investment Plans 5. Monthly Income Plans 6. Capital Preservation Solutions 7. Separately Managed Accounts 8. Meezan Pakistan Exchange Traded Fund 26
Slide 26: Al-Meezan – Financial Performance
Al-Meezan – Financial Performance Mar Mar ∆% 2023 2022 ✓ Largest Asset Management Company in Pakistan ✓ Established track record of over 27 years 269 177 53% AUMs– Rs Bn ✓ One of the largest investor base of over 183,000* investors Funds –Incl. plans (No.) 35 30 17% ✓ Manages the largest open-end Sh
Slide 27: Our Digital Footprint
Our Digital Footprint 28
Slide 28: Key Highlights and Achievements
Key Highlights and Achievements Meezan Bank is leveraging the latest technologies to strategically expand its reach, bring in newer product innovations, digitize its customers journeys and offer newer and simpler payment solutions. The Bank enjoys digital leadership in the following areas: ▪ Highest
Slide 29: Digital Channels Statistics (1/3)
Digital Channels Statistics (1/3) No in 000’s 2.95 Millions Total Debit Cards POS & E-Commerce Transactions Digitization Percentage (OTC vs Digital Q1 - 2023 Channels) 2,985 2,813 93.1% 93.7% 93.0% 94.0% 92.0% 2,326 32%: 3.08 1,991 Mn 88% 91% 92% 90% 1,505 85% 1,305 83% 84% 83% 83% 1,175 9.70 Mn POS
Slide 30: Digital Channels Statistics (2/3)
Digital Channels Statistics (2/3) POS Acquiring - Spend & Transactions EPG - Spend & Transactions No. in Mn 3.55 1,40 0 3.7 5 1,342 138 137 137 137 .0 .7 .4 136 .1 136 136 136 .9 .6 .3 .0 135 .5 135 .8 Digital Bill Payments Transactions 135 134 .2 .9 134 .4 134 .7 134 133 .1 133 .8 133 .6 .3 133 132
Slide 31: Digital Channels Statistics (3/3)
Digital Channels Statistics (3/3) Values in Tn Values in Bn No. in Mn IB / MB Value Growth Card Base Spending Value Digital Transfer Transactions P2P 2.89 50 51.18 44 43.73 2.24 39 1.71 34 34.78 31 30.25 1.51 1.27 26.35 Q1 - 2022 Q2 - 2022 Q3 - 2022 Q4 - 2022 Q1 - 2023 Q1 - 2022 Q2 - 2022 Q3 - 2022
Slide 32: Meezan as an Investment Opportunity
BEST BANK OF PAKISTAN Meezan as an Investment Opportunity Meezan Bank The Premier Islamic Bank FO
Slide 33: Meezan as an Investment Opportunity
Meezan as an Investment Opportunity - The Best Performing Banking Stock - Highest ROE in the Banking Industry for the last 5 years averaging more than 30% - Highest Market Capitilisation among banks in Pakistan - Highest Price to Book ratio among other Pakistani Banks - The Youngest AAA rated Bank i
Slide 34: Appendix
Appendix 35
Slide 35: Last Six Years Performance
Last Six Years Performance 36
Slide 36: Unconsolidated Statement of Financial Position: 2016 - Mar 2023
Unconsolidated Statement of Financial Position: 2016 - Mar 2023 Rs in Bn Balance Sheet 2016 2017 2018 2019 2020 2021 2022 Mar 2023 Cash and Balances with Banks 68,058 69,452 73,277 107,566 155,689 186,921 131,419 186,294 Due from FIs 129,115 147,229 184,815 223,689 342,069 238,402 34,964 34,964 Inve
Slide 37: Unconsolidated Profit & Loss Statement: 2016 – Mar 2023
Unconsolidated Profit & Loss Statement: 2016 – Mar 2023 Rs in Bn P&L Statement 2016 2017 2018 2019 2020 2021 2022 Mar 2023 Policy rate 6.00% - 5.75% 5.75% 5.75% - 10.00% 10.00% - 13.25% 13.25% - 7.00% 7.00% - 9.75% 9.75% - 16.00% 16.00% - 20.00% Policy rate - Average 5.85% 5.75% 7.10% 11.99% 8.95% 7
Slide 38: Key Ratios: 2016 – Mar 2023
Key Ratios: 2016 – Mar 2023 Key Ratios - % 2016 2017 2018 2019 2020 2021 2022 Mar 2023 Policy rate 6.00% - 5.75% 5.75% 5.75% - 10.00% 10.00% - 13.25% 13.25% - 7.00% 7.00% - 9.75% 9.75% - 16.00% 16.00% - 20.00% Income Efficiency Ratio 62.9 59.3 55.2 45.7 39.7 42.1 34.3 33.3 Branches opened 20 30 59 1
Slide 39: Thank You
Thank You 40