Maybank CLSA Investor Forum Presentation in Hong Kong

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Malayan Banking Berhad. Maybank CLSA Investor Forum Presentation in Hong Kong

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Maybank CLSA Investor Forum Presentation in Hong Kong

  1. 1. MALAYAN BANKING BERHAD CLSA Investor Forum, Hong Kong 13-17 September 2010
  2. 2. Overview: Maybank Group Operating Environment: Economy and Banking Sector Strategy: St t The new House of Maybank 1
  3. 3. Progress since 3 major acquisitions in 2008 18 Mar 08 26 Mar 08 5 May 08 Announces A Announces A Announces A acquisition of acquisition of 20 Aug 10 acquisition of An Bin Bank BII Announces MCB Bank FY10 Maybank Foreign Shareholding 10.00  21 Apr 10 24% results ce (RM) 30 Sep 08 29 April BII completes 25 Aug 09 rights issue of Completes Maybank 9.00  acquisition of completes Announces Rp1.4 trillion 22% FY09 ybank Share Pric BII rights issue of results 8.00  RM6 billion 20% (%) 7.00  18% 6.00  Share Price 16% May 5.00  14% 4.00  Foreign Shareholding 12% 3.00  10% Jan 08 Apr 08 Jul 08 Oct 08 Jan 09 Apr 09 Jul 09 Oct 09 Jan 10 Apr 10 Jul 10 Price Foreign Shareholding ■ Followed through on the 3 major acquisitions  Followed through on the 3 major acquisitions ■ Implemented LEAP30 Performance  Implemented LEAP30 Performance totaling RM11.2 billion Improvement Programme ■ Raised RM9.1 billion debt and capital securities ■ Built up BII ■ Completed largest ever rights issue of RM6 billion ■ Rebounded strongly with RM3.8 billion  ■ “Bit the bullet” in FY2009 with RM2.0 billion  PATAMI in FY2010 impairment charges 2
  4. 4. Maybank: In a position of strength ■ Total Assets :  RM 337 billion (USD 105 b) (As at 30 June 2010) Largest financial service  ■ Total Equity :  RM 29 billion (USD 9.0 b) provider in Malaysia  ■ Total Net Profit :  RM 3.8 billion (USD 1.2 b)  ■ Market Cap. :  RM 60.0 billion (USD 18.8 b) (1 Sep 10) ■ No 1 bank in Malaysia, Largest Islamic bank by assets No 1 bank in Malaysia Largest Islamic bank by assets Leadership position ■ No 4 in South East Asia ■ No 118 The Banker’s Top 1000 world banks ranking ■ 384 branches, 2,800 ATMs Largest banking  Largest banking 9 million customers. network in Malaysia ■ No.1 Internet banking with 55% market share ■ 7 ASEAN countries An Emerging An Emerging ■ 5 International Financial Centres ■ Over 1,750 branches and offices in 14 countries, Regional Leader serving 16 million customers. Leading market position  ■ Diversified across all financial products and services  in most sectors ■ Among the top 3 in most key business sectors Strong shareholder  ■ 56% owned by PNB and its funds, 12% by EPF support and credit  ■ S&P : A‐ ■ Moody’s: A3 i ratings ■ Fitch : A‐ ■ RAM: AAA 3
  5. 5. Domestic Market: Leading market position in most sectors Network N k Consumer C Deposits D i Cards C d Islamic Il i Investment  Insurance &  Banking Asset Mgmt Growth (YoY) 33% 36% 33% 28% 27% 21% 19% 15% 15% 16% 13% 8% 7% 7% 8% 4% 2% ‐9% 2% # #  n.a. na ‐1% Not applicable bt Markets Branch  Equity Brokerage eceivables ed General Billings Financing Card Base  ATM et banking HP Loans d Deposits Savings Deposits Merchant Sales Deposits Life/Family Asset Under Management CASA M&A Mortgage s Premium mer Loans* d Deposits Equity & Rights Offerings  C Re Fixed Demand Interne Deb Consum Combined Gross Combine Combined L 55% Market Share A C 29% 28% 29% 24% 22% 23% 24% 19% 17% 17% 19% 16% 13% 16% 15% 14% 15% dustry  12% 13% 13% 14% osition 10% 7% 1 1 1 2 3 3 1 na na na n.a. n.a. n.a. 1 1 1 2 1 1 4 5 2 4 1 1 1 3 Ind Po All data as at  June 2010, except for Insurance & Asset Mgt (Mar  10) * Consumer loans excludes SME  # percentage points increase in market share 4
  6. 6. Number 1 Bank Domestically … Total Assets (RM bn): 30 June 2010 Net Loans (RM bn): 30 June 2010 MAYBANK Maybank 337 MAYBANK Maybank 206 CIMB 256 CIMB 152 Public… 219 Public Bank 145 RHB Cap 120 RHB Cap 73 AMMB 97 AMMB 65 HL Bank 85 HL Bank 38 EON Cap 49 EON Cap 34 Affin 43 Affin 25 Alliance 33 Alliance 21 D Deposits (RM b ) 30 J it bn): June 2010 M k t C it li ti (RM b ) 1 S 2010 Market Capitalisation bn): Sep MAYBANK MAYBANK Maybank 60.0 Maybank 237 CIMB 57.2 CIMB 193 Public Bank 42.9 Public Bank 175 AMMB 17.5 RHB Cap 88 RHB Cap 14.7 HL Bank 70 AMMB HL Bank 14.0 68 EON Cap 37 EON Cap 4.8 Affin 31 Alliance 4.8 Alliance 23 Affin 4.6 5
  7. 7. And Among the Top Ten in the Region T t l A t (USD b ) 30 J 2010 Total Assets (USD bn): 30 June 2010 N tL dD it (USD b ) 30 J 2010 Net Loans and Deposits (USD bn): 30 June 2010 SBI * 198 SBI * 336 252 DBS 204 DBS 107 136 OCBC OC C 157 UOB 77 93 UOB OCBC 69 141 83 Maybank 66 ICICI 113 76 No.5 Net Loans ICICI 52 Maybank 108 No.6 54 Net Deposits CIMB 49 CIMB 82 62 Public… 46 Public Bank 70 56 * As at 31 Mar 10    RHB Cap 2328 RHB Cap 38 PATAMI (USD bn): (12 mths to June 2010) PATAMI (USD bn): (12 mths to June 2010) Market Capitalisation (USD bn): 1 Sep 2010 Capitalisation (USD bn): 1 Sep 2010 SBI 3.0 SBI 38 UOB 1.8 ICICI 24 OCBC 1.6 DBS 24 Maybank 1.2 No.4 UOB 22 ICICI 1.1 CIMB 1.1 OCBC 21 DBS 1.0 Maybank 19 No.6 Public Bank 0.9 09 CIMB 18 RHB Cap 0.4 Public Bank 14 Based on exchange rate as at 1 Sept 2010  6 * As at 31 March 2010
  8. 8. Overview: Maybank Group Operating Environment: Economy and Banking Sector Strategy: St t The new House of Maybank 7
  9. 9. Malaysia: Economic Rebound GDP to rebound with 7.5% growth in 2010; 6.1% in 2011 %g ; % Inflation expected to rise to 2.0% in 2010 (2009: 0.6%) p ( ) 150 Quarterly GDP and annual growth rate 12 CPI and components (% YoY) 140 9 6 130 3 120 0 110 (3) 100 (6) 90 (9) 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 RMb (LHS) % YoY (RHS) % QoQ (RHS) gg p yy Ringgit to expected to rise to RM3.10‐3.15 by year end After July 8 hike to 2.75%, interest rate is not  expected to rise in the next 9‐12 months 3.90 Ringgit Malaysia per USD 4.0 25bp hikes  Overnight Policy Rate: Bank Negara Malaysia 3.80 3.5 in Mar, May  3.70 3.0 and July 10 3.60 3.50 2.5 3.40 2.0 3.30 3.20 1.5 3.10 1.0 Overnight Policy Rate Overnight Policy Rate: Bank Negara Malaysia 3.00 0.5 ‐05 ‐05 ‐06 ‐06 ‐06 ‐07 ‐07 ‐07 ‐08 ‐08 ‐08 ‐09 ‐09 ‐09 ‐10 ‐10 Aug-04 Dec-04 Aug-05 Dec-05 Aug-06 Dec-06 Aug-07 Dec-07 Aug-08 Dec-08 Aug-09 Dec-09 Aug-10 Apr-04 Apr-05 Apr-06 Apr-07 Apr-08 Apr-09 Apr-10 01‐Jul‐ 01‐Nov‐ 01‐Mar‐ 01‐Jul‐ 01‐Nov‐ 01‐Mar‐ 01‐Jul‐ 01‐Nov‐ 01‐Mar‐ 01‐Jul‐ 01‐Nov‐ 01‐Mar‐ 01‐Jul‐ 01‐Nov‐ 01‐Mar‐ 01‐Jul‐ 8
  10. 10. Malaysia: Banking Industry – strong fundamentals ■ Loans growth of 11.9% YoY (July 10) driven by household  g ( y ) y Total Loans grew 11.9% YoY for Jul 2010 Total Loans grew 11 9% YoY for Jul 2010 sector. 860 18% ■ Competition expected to stiffen with issuance of more  16% commercial banking licenses to foreign banks, branch  810 14% expansion of existing foreign banks and further  760 consolidation of domestic banks. consolidation of domestic banks 12% ■ Net interest margin to remain relatively stable as  710 10% improvement from interest rate hikes offset by competitive  8% 660 Total Loans pressure for loans pricing. Total Loans YoY Growth 6% ■ Growing prominence of Islamic Banking through asset  610 Household YoY Growth 4% growth and greater products and services. Business YoY Growth ■ Improving asset quality with gross NPL at 3.55% 560 2% Oct-07 Oct-08 Oct-09 Jan-07 Apr-07 Jul-07 Jan-08 Apr-08 Jul-08 Jan-09 Apr-09 Jul-09 Jan-10 Apr-10 Jul-10 ■ Stable Tier I capital (13.1%) and Risk Weighted Capital Ratio  (15.0%) but possible higher capital adequacy requirement  pursuant to introduction of Basel III. pursuant to introduction of Basel III. RMm Gross NPL RM29.9b, Gross NPL ratio: 3.55% 16 Capital Adequacy remains strong 60,000 9.0% 15 15.0% Gross NPL (LHS) Gross NPL ratio (RHS) 14 50,000 8.0% 13 13.1% 40,000 7.0% 12 11 30,000 6.0% 10 9 20,000 5.0% Risk Weighted Capital Ratio 8 10,000 4.0% 7 Core Capital Ratio 6 0 3.0% Apr-07 Apr-08 Apr-09 Apr-10 Oct-07 Oct-08 Oct-09 Jul-07 Jul-08 Jul-09 Jan-07 Jan-08 Jan-09 Jan-10 Apr-07 Jul-07 Apr-08 Jul-08 Apr-09 Jul-09 Apr-10 Jul-10 Jan-07 Oct-07 Jan-08 Oct-08 Jan-09 Oct-09 Jan-10 9
  11. 11. Singapore: Conducive Environment ■ Singapore expected to rebound in 2010 with GDP growth Singapore expected to rebound in 2010 with GDP growth  Real GDP growth of 13‐15% in 2010;  4‐6% in 2011 g ; of between 13.0‐15.0% and 4.0 – 6.0% in 2011. 80 20 ■ Inflation is likely to range between 2.5 – 3.5% in 2010 75 15 ■ Unemployment rate projected at 2.0 – 2.5% in 2010 70 10 ■ Loan growth recovery gaining traction, driven by housing  g yg g , y g 65 5 loans and a pickup in corporate loans, particularly to the  60 0 General Commerce Sector.  Loans growth in 2009 of 3.4%  expected to improve to 7‐9% in 2010. 55 (5) ■ Net interest margin (NIM) to narrow further in 2H10 due  50 (10) to prolonged low interest‐rate environment and greater  to prolonged low interest‐rate environment and greater 0P 0P 08 08 08 08 09 09 09 09 10 10 1Q0 2Q0 3Q0 4Q0 1Q0 2Q0 3Q0 4Q0 1Q1 2Q1 3Q10 4Q10 competition for loans and deposits. Average NIM expected  Real GDP (S$B) % YoY Growth (RHS) at 1.8% to 2.1% in 2010, before rising to between 1.9% to  2.2% in 2011. Total Loans expected to grow 7‐9% in 2010 3‐month SIBOR to range between 0.5‐0.6% in 2H10 40% 0.70 30% 0.65 20% 0.60 0 60 10% 0.55 0% 0.50 -10% Sep 09 Nov 09 Dec 09 Aug 10 Sep 10 Oct 09 Jan 10 Feb 10 Mar 10 Apr 10 May 10 Jun 10 Jul 10 Axis Title Total Loans Business Loans Consumer Loans 3-Month SIBOR 10
  12. 12. Indonesia: Continued Growth Real GDP Growth: picking up p g p ■ We expect 2010 GDP growth to reach 6.05%, higher  580,000 8 than the growth of 4.53% in 2009. 7 560,000 ■ Inflation rate for 2010 is expected to range between  6 540,000 6% to 6.2% from around 12% a year ago while the BI  5 Rate is expected to remain at 6.5% in order to keep  Rate is expected to remain at 6 5% in order to keep 520,000 520 000 4 the economy’s growth momentum 500,000 ■ USD/IDR is expected to hover around the 9,000 level  3 480,000 as capital inflow lends support for currency stability. 2 ■ Loan growth is expected to reach 20% with the Loan growth is expected to reach 20% with the  460,000 Real GDP (IDR bn) - LHS Real GDP Grow th (% y-y) 1 consumer segment driving growth. 440,000 0 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 ■ NPL is expected to remain at 3.7% Bank s Bank’s loan growth: trending upwards Bank Indonesia policy rate on hold at 6.5% 45.00% 14 % 40.00% 12 35.00% 10 30.00% 8 25.00% 6.50 6 50 20.00% 6 6.22 15.00% 4 10.00% 2 5.00% Inflation y-y BI Rate 0.00% 0 00% 0 Mei Mei Mar Mar Okt Okt Nov Jul Nov Jun Feb Jun Jul Dec Apr Jan Feb Des Jun Jan Sep Apr Sep 31-Jul-07 31-Jan-08 31-Jul-08 31-Jan-09 31-Jul-09 31-Jan-10 31-Jul-10 Ags Ags 2009 2010 11
  13. 13. Overview: Maybank Group Operating Environment: Economy and Banking Sector Strategy: St t The new House of Maybank 12
  14. 14. Financial Performance: FY2010 ■ Record PATAMI for FY10 of RM3,818 million due to improved  contribution across all key business segments. ■ Quarterly PATAMI remained above RM900 million level. ■ Group loans grew 10.3% YoY with domestic loans growth of 11%. ■ A t Q lit Asset Quality continued to improve with Net NPL ratio declining to  ti dt i ith N t NPL ti d li i t 1.22% from 1.36% the preceding quarter and 1.64% a year ago. ■ Crossed regional milestone with total assets of RM336 billion  (more than USD100 billion). ■ Capitalisation remains strong with CAR* at 14.9% for the Bank and  14.6% for the Group.  14 6% for the Group ■ Normalised ROE of 13.6% exceeds our Headline KPI.  * Assuming full reinvestment of electable portion under the Dividend Reinvestment Plan Assuming full reinvestment of electable portion under the Dividend Reinvestment Plan 13
  15. 15. Reframing our Vision, Mission and Strategic Objectives By 2015 B 2015 Our Vision To be a Regional Financial Services Leader Our Mission Humanising Financial Services from the Heart of ASEAN 1.  Undisputed No. 1 Retail Financial Services provider in  Strategic Objectives Malaysia by 2015 2.  2 Leading ASEAN wholesale bank eventually expanding to  di S h l l b k ll di Middle East, China & India 3.  Domestic Insurance Champion and emerging regional player 4.  Truly regional organisation, with ~40% of pre‐tax profit  derived from international operations by 2015 5.  Largest Islamic bank in ASEAN  5 L t I l i b k i ASEAN 14
  16. 16. New Group Organisation Structure to support aspirations Maybank Group CEO + Support  (CFO, CRO,GHC, Legal, Compliance, Communications) (CFO CRO GHC L l C li C i ti ) Community  Global Wholesale  Insurance &  E ISLAMIC  Financial  Banking Takaful INSPIRED N Services A Leveraging  Regaining  Being the  B shared  domestic  National  L distribution,  leadership and  Insurance  Insurance E Customer  aggressively  Champion and  M INTERNATIONAL  Segment driven,  pursuing ASEAN  Living the  E EXPANSION Community  market expansion  ETIQA way N Bank by humanising T client interaction Enterprise Transformation Services 15
  17. 17. Priorities for FY2011 1. Grow market share of individual and non‐retail deposits Grow market share of individual and non retail deposits  Community Financial  domestically and leverage on shared distribution synergies Services 2. Re‐align SME market segment focus 3. Ramp up universal wholesale banking model growth Global Wholesale Banking in core ASEAN markets 4. Strengthen transaction banking franchise 5. Grow investment banking capabilities and deals b k bl dd l Insurance & Takaful 6. Gain leadership in domestic insurance business International 7. Grow assets, strengthen deposits base and expand branch network in Indonesia Islamic Banking l k 8. Grow Islamic banking assets and deposits Corporate / Enterprise  9. Improve business process and upgrade IT systems Transformation Services Transformation Services 10. Implement FRS 139 and refine Basel II use. 10 I l t FRS 139 d fi B l II 16
  18. 18. Bank Internasional Indonesia (BII) Gross Loans: Composition (Rp trillion) and growth  (+36%) ■ By 2015, to become among Top 5 banks by assets &  17.1  14.4  (+37%) returns, with initiatives in 5 main areas: 12.6  15.9  13.0  1. Leading banker for transportation industry 11.6  9.6  11.3  2. USD Payment Bank USD Payment Bank 8.5  ( (+33%)) 3. SME/Commercial: No. 1 in Supply Chain Financing 2.4  2.1  2.5  0.3  0.4  (+4%) 0.5  4. Corporate: No. 1 in Structured Trade Financing &  Resource Based Industry Jun 09 Dec 09 Jun 10 (+67%) Corporate SMEC(+33%) Consumer 5. No. 1 in Credit Card Sya a Syariah Subs d a es Subsidiaries Other initiatives ■ Strengthen infrastructure in IT and with branch  Net Interest Margin  expansion, from 294 branches to increase to 450 by  6.85% 6.15% 6.41% 6.62% end Jun 2012. 6.10% 5.91% 5 91% 5.90% 5 90% ■ Operate Islamic banking through Maybank Indocorp. 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 ■ BII, as one of the top 2 banks with dedicated 2  wheelers subsidiaries, is to improve WOM Finance’s  Asset Quality sales, asset quality and profitability as a top  sales, asset quality and profitability as a top 4.74% 4 74% motorcycle financing provider. 3.46% 3.49% 3.20% 2.79% 2.88% 2.39% ■ Leverage on subsidiaries to cross sell. 2.79% 2.00% 1.85% 1.90% 1.92% 1.87% ■ Maintain and strengthen service differentiation. 1.56% ■ Build on synergy opportunities with Maybank. Dec‐08 Mar‐09 Jun‐09 Sep‐09 Dec‐09 Mar‐10 Jun‐10 Gross NPL Net NPL 17
  19. 19. Prospects and KPIs ■ Recovering regional economies to spur demand with loans growth of 12% in Malaysia, 24% at BII  Headline KPIs and 5% in Singapore.  ■ International  contribution is expected to increase te at o a co t but o s e pected to c ease Return on Equity Return on Equity 14% mainly from 2 key home markets of Singapore and  Indonesia and leveraging on Global Wholesale  Loans and Debt Securities  12%  Banking platform.  Growth ■ Islamic Banking is identified  as key differentiator  g y Other targets Other targets with target financing growth of 25%. Loans Growth ■ Margins expected to be stable. • Malaysia 12% ■ The  reframed vision and mission supported by  new organisation structure is expected to drive  i ti t t i t dt d i • Singapore 5% growth.  • BII 24% ■ Investment in people, technology and processes to  realise vision and strategic objectives, with efforts  Net Interest Margin Stable to reduce costs through synergies and centre of  to reduce costs through synergies and centre of Dividend Payout Ratio 40%‐60% excellence. Note: Loans growth for Singapore and BII are in  ■ Dividend Reinvestment Plan in place to ensure  local currency robust capital adequacy. 18
  20. 20. Financial Performance: FY ending 30 June 2010 Business Review i i Country Review: Singapore and Indonesia Singapore and Indonesia Appendix 19
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