Absa Group Limited · JSE:ABG
Absa — Barclays Africa Group — Non-Deal Roadshow (May 2017)
20 slides from Absa's roadshow presentation, May 2017
Slide 1: South African Fixed Income Investor Roadshow for BAGL
Barclays Africa Group Limited (“BAGL”) South African Fixed Income Investor Roadshow for BAGL 0 | BAGL South Africa Fixed Income Investor Roadshow | May 2017 May 2017
Slide 2: Contents
Contents 1 Introduction to BAGL 2 Credit Rating 3 Additional Tier 1 Overview 4 Appendix 1 | BAGL South Africa Fixed Income Investor Roadshow | May 2017
Slide 3: 1. Introduction to BAGL
1. Introduction to BAGL
Slide 4: BAGL Group Structure
BAGL Group Structure Headline Earnings per Geographical Segment Other public Barclays Plc shareholders 2016 50.1% 49.9% 18% BARCLAYS AFRICA GROUP LTD BBB (Botswana) 67.8% Absa Bank Limited 100% 82% BBG (Ghana) 100% Absa Financial Services Limited 100% BBK (Kenya) 68.5% BBM (Mozambique) 98.1% South A
Slide 5: BAGL Fast Facts
BAGL Fast Facts RoE & RoA Performance Pre-Provision Profit (Rbn) 22% 1.5% 35 1.5% 20% 30 RoE RoA (RHS) 1.4% 1.4% 25 18% 1.3% 1.3% 20 16% 1.2% 32.4 15 29.5 1.2% 26.0 27.3 14% 16.7% 17.0% 16.6% 1.1% 10 15.5% 12% 1.1% 5 1.0% 10% 1.0% 0 FY13 FY14 FY15 FY16 FY13 FY14 FY15 FY16 Non-Performing Loans Divide
Slide 6: Liquidity Management
Liquidity Management Liquid Assets BAGL Liquid Assets and Reserves Position (Rbn) • BAGL is fully compliant with regulatory liquidity requirements for 2016. • The liquidity risk position remained healthy and within key limits and 33.2 metrics. The average liquid assets for the year increased from R1
Slide 7: BAGL Group Capital Composition – December 2016
BAGL Group Capital Composition – December 2016 Absa Bank Absa Bank Entity (As at Dec-16) BAGL 2 Residual 2016 Entity Targets BAGL 2 Limited Limited Total Assets R1.101bn R918bn R183bn CET1 – Regulatory 1 6.88% 6.88% minimum Headline Earnings R14.980bn R9.778bn R5.202bn CET1 – Internal target 9.5% -
Slide 8: The Barclays separation will result in a short term capital benefit
The Barclays separation will result in a short term capital benefit Update on Barclays PLC sell-down and separation Since 1 March 2016, when Barclays PLC announced its intention to reduce its shareholding in BAGL to achieve accounting and regulatory deconsolidation, we have worked jointly to ensure
Slide 9: 2. Credit Rating
2. Credit Rating
Slide 10: South African Sovereign Credit Rating
South African Sovereign Credit Rating History of South Africa’s Long Term Foreign Currency Ratings South African 5-year CDS A A2 A- A3 BBB+ Baa1 BBB Baa2 ___________________________ BBB- Baa3 BB+ Ba1 BB Ba2 Source: Bloomberg BB- Ba3 B+ B1 B B2 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09
Slide 11: South African Big Four Bank Credit Ratings
South African Big Four Bank Credit Ratings Comparable Senior Credit Ratings Global LT Foreign Currency Group: Baa3 * Baa2 * Bank: Baa2 * Bank: Baa2 * Bank: Baa2 * Bank: Baa2 * Global LT Local Currency Nat’l LT National Scale Bank: Aa1.za Bank: Aaa.za Bank: Aa1.za Bank: Aa1.za Group: BB- (Neg) Global
Slide 12: 3. Additional Tier I Instrument Overview
3. Additional Tier I Instrument Overview
Slide 13: Additional Tier I - Salient Features
Additional Tier I - Salient Features Salient Features Additional Tier I • Senior to equity only Ranking • Subordinated to depositors, general creditors and other subordinated debt of the bank (Tier 2) Maturity • Perpetual with no step-ups or other incentives to redeem • After 5 years, at the option
Slide 14: Previous Price Points
Previous Price Points Previous pricing points for PerpNC5 AT1 vs, 10NC5 Tier II floating rate notes Spreads (bps) 750 700 700 650 625 600 550 565 500 450 435 425 425 425 425 425 400 415 400 400 400 400 400 400 385 380 378 350 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-
Slide 15: BAGL/ABSA Debt Maturity Profile
BAGL/ABSA Debt Maturity Profile Rmn 10,000 2017 Forecasted issuance activity: 8,000 R4-6bn in total of BAGL Basel III-compliant Tier II and Additional Tier 1 capital 6,000 4,000 2,000 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 Absa Senior Absa Tier 2 BAGL Senior BAGL Tier 2 ___________
Slide 16: 4. Appendix
4. Appendix
Slide 17: S&P Mapping Scale And Methodology
S&P Mapping Scale And Methodology On 3 April 2017 Standard and Poor’s (S&P) downgraded the South African Global-scale long term National-scale long-term Sovereign. S&P do not rate financial institutions above the foreign currency rating rating rating of the sovereign, and accordingly lowered the nat
Slide 18: Quick Links
Quick Links • Liquidity Coverage Ratio (Jan 2013) - http://www.bis.org/publ/bcbs238.htm • Net Stable Funding Ratio (Oct 2014) - http://www.bis.org/bcbs/publ/d295.htm Basel / FSB / • TLAC - http://www.financialstabilityboard.org/wp-content/uploads/TLAC-Condoc-6-Nov-2014-FINAL.pdf EBA • MREL - https:/
Slide 19: Contacts
Contacts Barclays Africa Syndicate Deon Raju – BAGL Treasurer Matt Duggan – Head, Principal Tel no. 011- 895 7107 / [email protected] Tel no. 011- 895 7864 / [email protected] Rolf van den Heever – Head, CME & Balance Sheet Management Trishalia Naidoo – Principal Tel no. 011- 895 6381
Slide 20: Disclaimer
Disclaimer Certain statements (words such as ‘anticipates’, ‘estimates’, ‘expects’, ‘projects’, ‘believes’, ‘intends’, ‘plans’, ‘may’, ‘will’ and ‘should’ and similar expressions in this document are forward looking. These relate to, among other things, the plans, objectives, goals, strategies, futu