Emirates NBD Bank (P.J.S.C) · DFM:EMIRATESNBD
Emirates NBD Bank (P.J.S.C) — Emirates NBD — Investor Presentation (June 2011)
34 slides from Emirates NBD Bank (P.J.S.C)'s investor presentation, June 2011
Slide 1: Emirates NBD Investor Presentation
Emirates NBD Investor Presentation May / June 2011 1
Slide 2: Important Information
Important Information Disclaimer The material in this presentation is general background information about Emirates NBD's activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to
Slide 3: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy and Outlook 3
Slide 4: UAE Economic Update
UAE Economic Update Highlights Real GDP Growth Forecasts The IMF recently upgraded its 2011 forecast for UAE GDP growth to 3.3%, 2008 2009 2010 2011 from 3.2%. We see growth registering 4.0% this year. UAE 7.4% (3.0%) 2.5% 4.0% Local growth is benefiting from the price of, and the demand for, hy
Slide 5: Dubai Economic Update
Dubai Economic Update Highlights Dubai 2008 GDP breakdown Dubai is the 3rd largest centre for re-exports in the world which itself UAE GDP by Emirate (2008) Dubai GDP by Sector (2008) represents 44% of GDP. 100% = USD 254b 100% = USD 82b Dubai is a strategically located international trading hub
Slide 6: UAE Banking Market Update
UAE Banking Market Update Highlights UAE Banking Sector Growth (USD billion) UAE Banking sector is the largest by assets in the GCC; sector is dominated by 23 453 local banks which account for more than 75% of banking assets; 28 foreign banks 403 425 account for the remainder 333 UAE loan growth
Slide 7: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy and Outlook 7
Slide 8: Summary
Summary Largest financial institution (by asset size) in the GCC Flagship bank for Dubai and the UAE Governments 56% owned by Dubai government Consistently profitable; despite significant headwinds during the last two years Fully fledged, diversified financial services offering Ever increasing prese
Slide 9: Emirates NBD at a Glance
Emirates NBD at a Glance Largest Bank in UAE Largest Branch Network in the UAE No.1 Market share in UAE (at end 2010): Ras al-Khaimah (3) Dubai 98 – Assets c.18%; Loans c.19% Abu Dhabi 20 Umm al-Quwain (2) – Deposits c.19% Sharjah 13 Fujairah (2) Other Emirates 9 Ajman (2) Retail market shares (
Slide 10: Emirates NBD is the Largest Bank in the UAE and GCC by Assets
Emirates NBD is the Largest Bank in the UAE and GCC by Assets As at 31 March 2011 UAE Ranking by Assets (USD billion) UAE Ranking by Equity (USD billion) UAE Ranking by Profits (USD million) (1) Emirates NBD 81.8 Emirates NBD 7.6 Emirates NBD 385 NBAD 63.6 NBAD 6.6 NBAD 252 ADCB 49.2 FGB 6.5 FGB 239
Slide 11: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy and Outlook 11
Slide 12: Profit and Balance Sheet Growth in Recent Years
Profit and Balance Sheet Growth in Recent Years Revenues and Costs (USD million) Net Profits (USD million) Revenue Costs -6% +20% +14% 2,939 2,647 967 1,074 914 1,002 2,300 831 910 1,935 740 815 491 637 1,291 696 615 302 385 235 220 2006 2007 2008 2009 2010 Q1 2006 2007 2008 2009 2010 Q1 2006 2007 2
Slide 13: Financial Highlights
Financial Highlights 2010 and Q1 2011 2010 Financial Results Highlights Key Performance Indicators Net profit of USD 637 million; -30% from USD 910 million in 2009 Income Statement Q1 2011 Q1 2010 Change 2010 2009 Change USD million (%) (%) Total income of USD 2,647 million; -10% from USD 2,939
Slide 14: Net Interest Income
Net Interest Income Highlights Net Interest Margin Trends (%) NIM of 2.52% in 2010; declined by 29 bps from 2.81% in 2009: 3.01 o Negative mix impact of deployment of increased liquidity in lower yielding Qtrly NIM interbank and cash-equivalent assets 2.85 2.76 o Increase in deposit funding costs
Slide 15: Non Interest Income
Non Interest Income Highlights Composition of Non Interest Income (USD million) 2010 non-interest income declined by 13% from 2009, impacted by: USD million Q1 Q1 Change 2010 2009 Change 2011 2010 (%) (%) o USD 58m write-downs of investment properties Core gross fee income 181 161 +12% 909 936 -3%
Slide 16: Operating Costs and Efficiency
Operating Costs and Efficiency Highlights Cost to Income Ratio Trends Costs declined by 14% to USD 831 billion in 2010 due to management focus on cost optimisation and operating efficiency; the cost to income ratio Cost to income ratio (YTD) improved by 1.5% from 32.9% in 2009 to 31.3% in 2010 38.
Slide 17: Credit Quality
Credit Quality Loans & Receivables and Islamic Financing Highlights Loan Portfolio by Type – Q1 2011(1) The impaired loans ratio increased in line with expectations by 0.4% in 100% = USD 55.7b Q1 2011 to 10.4% Full required provision for Dubai World made in Q3 2010; pro-actively provided for a p
Slide 18: Credit Quality
Credit Quality Retail and Corporate Loans & Receivables Corporate & Sovereign Lending Portfolio By Sector(1) Corporate Credit Quality Real Estate & Contracting 100% = USD 44.7b • Impaired loan ratio 9.4% at Q1 2011 vs. 9.2% at Q4 2010 and • Exposures to Real Estate and Contracting Sector are 1.0% at
Slide 19: Capital Adequacy
Capital Adequacy Highlights Capital Ratios - Basel II (USD billion) Q1 2011 Capital adequacy remained stable at very strong levels of CAR 20.1% and T1 12.7% 18.7% 20.1% 20.1% Total capital increased by USD 130 million in Q1 2011 as net profit 11.9% 12.8% 12.7% 10.5% generation partly offset by d
Slide 20: Funding and Liquidity
Funding and Liquidity Highlights Loan to Deposit Ratios (%) Liquidity continued to improve with headline LTD ratio of 92% at Q1 2011 Headline LTD Ratio % Target headline LTD ratio of 95%-100% for 2011 129% Adjusted LTD Ratio % 126% 127% 122% Liquid assets of USD 18.0 billion as at 31 March 201
Slide 21: Associates and Joint Ventures
Associates and Joint Ventures Composition of Balances Highlights Composition of Associates & Joint Ventures (USD million) Significant de-risking of investment in Union Properties (UP) since 2009: Income Statement Q1 Q1 Change 2010 2009 Change USD million 2011 2010 (%) (%) o UP investment reduced b
Slide 22: Network International
Network International Strategic Partnership with Abraaj Capital Transaction Summary & Strategic Rational Financial Impact on Emirates NBD On 22 December 2010, Network International (NI) entered into a In 2010, the assets and liabilities were disclosed as assets held for strategic partnership wit
Slide 23: Divisional Performance: Wholesale Banking and Wealth Management
Divisional Performance USD billion USD million Key focus during the period was on balance sheet optimisation, -7% continued proactive management of credit quality, building non- 46.6 43.9 43.7 Wholesale Banking 301 291 risk based and fee generating businesses 279 Revenue declined 7% year-on-year
Slide 24: Global Markets & Treasury; Emirates Islamic Bank
Divisional Performance Revenue declined by 47% in Q1 2011 to USD 40 million driven USD million mainly by lower sales and trading income and lower gains on Global Markets & Treasury principal investments 75 -47% Trading business revenue was impacted by the regional 58 geopolitical tensions, finan
Slide 25: Contents
Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy and Outlook 25
Slide 26: Two years on from the crisis, the Bank is better positioned for the future
Two years on from the crisis, the Bank is better positioned for the future Capital Ratios – Basel II Loan to Deposit Ratios Liquid Assets 20.1% 7.3% 20.4% Stronger 10.5% 9.7% 11.1% capital base 2.0% 129.0% 109.0% -9.5% 12.8% 99.0% 88.0% and liquidity 8.5% 2008 2010 Net Liquid Assets Ratio (%) 2008 2
Slide 27: Emirates NBD's strong brand, culture and franchise
Emirates NBD’s strong brand, culture and franchise 27
Slide 28: Strategic Imperatives are Evolving
Strategic Imperatives are Evolving Gradual Shift in Focus from Strengthening the Bank to Growth Acceleration 2008 2009 2010 2011 2012 Crisis Growth Manage Strengthening the Bank Acceleration ment 1. Optimise Balance Sheet 1. Optimise Balance Sheet • Capitalisation • Capital allocation • Liquidity •
Slide 29: Strategic Imperatives for 2011
Strategic Imperatives for 2011 Objectives Increase lending activities in identified pockets of growth, e.g. SME lending, cards, … Optimise Balance Sheet Further diversifying funding sources with a focus on reducing cost of funding and Capital allocation Review all Group companies (subsidiaries
Slide 30: Outlook
Outlook Conditions in the local economy have continued to improve in Q1 2011: o Economic signals offer evidence of take-off in non-oil economy, particularly in trade, logistics and hospitality o Oil prices hold strong above USD 100 per barrel Regional unrest temporarily took a toll on local mark
Slide 31: Summary
Summary Strong financial performance in Q1 2011 driven by gain on the Network International transaction, partly offset by continued pro-active de-risking of the balance sheet and acceleration of investment in growth opportunities Top-line trends encouraging with recent pickup in q-o-q net interest i
Slide 32: Appendix
APPENDIX Emirates NBD
Slide 33: 2011 Awards
2011 Awards March 2011 – “Best bank in the UAE” for the year 2011 by Global Finance February 2011 – Emirates NBD Capital named “Best investment bank in the UAE” by Global Finance February 2011 – “Human Resources Development in Banking and Financial sector” Award for 2010 at the Sharjah Career Fair 2
Slide 34: Investor Relations
Investor Relations PO Box 777 Emirates NBD Head Office, 4th Floor Dubai, UAE Tel: +971 4 201 2606 Email: [email protected] Ben Franz-Marwick Head, Investor Relations Tel: +971 4 201 2604 Email: [email protected] 34