3. UAE economy
3
UAE Real GDP growth [%]GCC countries comparison 2014 FC
Moderate outlook driven by:
> Growth in non-oil economy,
> Oil reserves,
> UAE’s position as an unparalleled economic
hub in the region,
> Dubai established as a trade and logistics
hub,
> Tourism on the rise and stabilizing real estate
UAE is the 2nd largest economy in the GCC, with low
dependency on oil at 33%
1
4
4
2
9
31
Population [mn]Nominal GDP [USD bn]
Bahrain34
Oman81
Kuwait179
Qatar212
UAE416
Saudi Arabia778
9%
Others
25%
Manufacturing
9%
Construction
Trade
12%
Real Estate
12%
Oil
33%
UAE Real GDP composition 2013 [%]
Source: IMF October 2014; UAE National Bureau of Statistics
UAE market outlook
3.5
5.24.43.9
1.7
-4.8
3.2 4.3
2014
FC
201320122011201020092008 2015
FC
Real GDP growthInflation
12.3
1.6
0.9 0.9 0.7
2.2 2.5
1.1
4. Non-oil growth in Dubai and Abu Dhabi is driving overall GDP
growth
4
UAE economy
Dubai Real GDP growth [%]
4.64.4
3.33.5
-2.7
3.2 3.1
201320122011201020092008 1H
2014
5.25.6
9.3
6.5
-4.9
6.4 5.8
201320122011201020092008 1Q
2014
Abu Dhabi Real GDP growth [%] …driven by resilient non oil growth
4.04.34.4
6.5
Trans.
& Comm.
UtilitiesHotelsMnfg
…driven by key sectors
-0.3
11.7
6.87.5
12.7
7.47.76.9
3.2
3.8
6.7
6.1
-13.9
4.9
20092008 20112010 2012 2013 1Q
2014
Non oil Real GDP growthOil Real GDP growth
Dubai 1H 2014 Real GDP YoY growth by sectors
Source: Dubai Statistics Centre, Statistics Centre of Abu Dhabi, Abu Dhabi government of Economic Development
5. 5
Country
Bahrain3)
Kuwait
Oman3)
Qatar
Saudi
Arabia
UAE
8
-1
10
13
11
10
Total assets 20141)
[USD billion]
Assets/GDP2)
[%]
UAE is the largest banking sector in the Arab world by assets
1) Excludes foreign assets
2) Nominal GDP
3) Assets data as of November 2014
Source: Central Banks; IMF
50
65
188
276
569
632
CAGR, 11-14
[%]
152
82
130
105
80
146
UAE banking sector
Dec-2014
# of banks:
> National: 23
> Foreign: 26
# of branches:
> National: 869
> Foreign: 86
Gross credit: USD 380
billion
> Domestic: USD 353 billion
> Foreign: USD 27 billion
Deposits: USD 387 billion
> Resident: USD 345 billion
> Non-resident: USD 42 billion
UAE economy
6. Several sectors such as non-oil trade flows
witnessed strong growth over the last five years.
UAE non-oil trade flows [AED billion]
Non-oil growth is gaining momentum as
demonstrated by an increase in business activity
HSBC PMI index
6Source: HSBC, Federal Customs Authority, Hotel and Airport authorities of UAE, DP World; 1) As of Oct 2014
UAE economy – Microeconomic outlook
Additionally the hospitality sector, especially in
Dubai, is one of the major growth drivers …
Hotel guests [million] Air passengers [million]
… along with the logistic sector, which has been
growing continuously over the last three years.
UAE container volumes [TEU million]
UAE air freight [million tonnes]
485
603
737
909
175
495
163
Imports
Exports
Re-exports
2013
1,458
374
2012
1,234
334
2011
928
114
211
2010
754
83
186
1H’14
204
794
95
CAGR
’10-’13
23.3%
28.1%
26.1%
Increasing rate of growth
50 – no change on previous month
58
57
58
59
56
58
5656
58
56
53
56
40
45
50
55
60
65
Increasing rate of contraction
5.8
11.0
10.0
9.1
8.3
2.82.42.11.8
2013201220112010 1H’14
2.81)
70
66
58
5147
20
17151211
2013201220112010 2014
Abu DhabiDubai
2.3 2.2 2.3 2.4 2.4
2013
3.1
0.7
2012
2.9
0.6
2011
2.7
0.5
2010
2.7
0.4
2014
3.2
0.8
Abu DhabiDubai
13.913.613.313.011.6
2013201220112010 1H’14
5958
61
5858585857585857 58
Oct-14
Nov-14
Dec-14
Jan-15
Sep-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14
Jul-14
Aug-14
7. 7Source: JLL, UAE Central Bank, HSBC
UAE economy – Microeconomic outlook
Rents are stabilizing in Dubai and Abu Dhabi…
… supported by continuous increase in employment
levels
HSBC Employment index [#]
Rate of increase in Dubai property prices is slowing
reflecting stabilization
Mashreq Property Price Index [%]Dubai Q4 ‘14 Abu Dhabi Q4 ‘14
Residential Office Retail Hotel
Increasing rate of growth
50 – no change on previous month
53
58 58 58
59
58
5657
56565656
40
45
50
55
60
Personal loans to residents [AED]
318
280
261252247
20142013201220112010
+14%
+7%
Consumer borrowing has been rising…
Rent
falling
Rent
bottoming
out
Rent
growth
slowing
Rent
growth
acceler-
ating
Rent
falling
Rent
bottoming
out
Rent
growth
slowing
Rent
growth
acceler-
ating
-5
0
5
10
15
20
25
30
Jan-15Nov-14Sep-14Jul-14May-14Mar-14Jan-14Nov-13
Cum MPPI inc (%)Avg MPPI inc (%)
535353
56
525353
54
55
535353
Oct-14
Nov-14
Dec-14
Jan-15
Sep-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14
Jul-14
Aug-14
Increasing rate of contraction
9. Mashreqbank heritage
Diversified business
case
> Universal bank offering a comprehensive suite of products and services to
individuals and corporates across all lines of business
> Most diversified revenue streams with fee and other income contributing
~50% of total income
Strong management
team
> Combination of long serving senior executives with international
management expertise delivering a robust growth model
> Led by Abdul Aziz Abdulla Al-Ghurair, Chief Executive Officer for 24 years
Private sector
ownership
> Oldest regional bank based out of UAE
> Combines the entrepreneurial spirit of Dubai with enduring trade banking
relationships across the region
> Publicly traded since inception; Listed on the DFM on creation of local
stock exchange
Strong and
supportive
ownership structure
> Al-Ghurair Group, the main shareholders of the bank, are a leading
conglomerate in the UAE with numerous business interests
> Featured in the Forbes billionaire list for the past 10 years
> Mashreqbank is the flagship business for the family for nearly 50 years
Heritage
> Established in 1967 by the Al-Ghurair Group
> 48 years in UAE banking and financial services market
Strong regional
presence
> Well positioned to finance regional trade flows
> Regional bank with 43 branch network in the UAE and 20 branches /
offices in MENA, Asia, Europe and United States
9
Mashreqbank is one of UAE's leading financial institutions
10. Ownership – Al-Ghurair flagship brand
> Al-Ghurair families holds the majority stake in
Mashreqbank (approximately 87%) and are
the founders of the Bank
> Al-Ghurair family has a strong commitment to
the continued growth and financial solidity of
Mashreqbank
> Al-Ghurair family is one of the oldest and
wealthiest families in the UAE
● Featured in Forbes billionaire list for the
past 10 years,
● Business interests include shopping malls,
real estate, cement manufacturing, food
industries, Masafi (mineral) water,
contracting, trading, retailing, shipping,
printing & packaging, aluminium extrusion,
building materials, oil refinery,
manufacturing, steel and canning
> Mashreqbank’s shares are listed and traded
on the Dubai Financial Market
Key shareholders
10
Mashreqbank heritage
Stable and supportive ownership structure
13%
5%
12%
31%
39%
> One of the most prominent businessmen and
industrialists in the UAE
> Former Chairman of the UAE Banks Association
Mr. Abdulla Bin Ahmad Al-Ghurair
Chairman & President
> Chairman of UAE Banks Federation
> Vice Chairman of the higher board of DIFC
> Chairman of Masafi, Oman Insurance
> Board Member of Emirates Foundation
> Former Speaker of the Federal National Council
H.E. Abdul Aziz Abdulla Al-Ghurair
Chief Executive Officer & Director
Other shareholders
Other Al-Ghurair owned
Masar Investments
(Abdul Aziz Al-Ghurair)
Abdulla Ahmed
Al-Ghurair Inv. Co.
Saif Al-Ghurair Inv. Co.
Mashreqbank’s Leadership
11. Strong distribution network in the UAE with 22 branches in
Dubai
11
Mashreqbank heritage
Umm Al Quwain
> 1 branch
Abu Dhabi
> 10 branches
Ajman
> 1 branch
Ras Al Khaimah
> 1 branch
Fujairah
> 1 branch
Sharjah
> 7 branches
Dubai
> 22 branches
Alternate Channels
> 43 branches (out of which Mashreq Gold
has presence in 29 branches and SME
Banking has presence in 21 branches) and 4
Retail Customer Service Centers in UAE
serving ~500K customers
> ATMs and CCDMs increased coverage to 233
units in UAE
> 21,000 POS machines spread over 12,200
merchants in the UAE. 2nd Largest Merchant
acquirer in the UAE with over 35% market
share
> Internet Banking through Mashreq Online
(Retail incl. Brokerage), Mashreq Business
online (Corporate), Mashreq-FI online
(Correspondent Banking); 203,300 registered
retail customers online banking
> Mobile banking services: Snapp
registration has grown up 34% YoY, and
financial transactions has grown by 37%.
Snapp has been equipped with unique
features such as : Mobile 2 Mobile transfers,
Cardless cash withdrawals, My money
manager and Forex alerts
> Fully integrated electronic platform for
transaction banking (GTS)
> State of the art Polaris System
(mashreqMATRIX) to provide online services
to corporate customers
> 24 x 7 Direct Banking Call Centre
12. Regional and international banking presence with 18% of
revenues from outside of UAE
12
International
branches
Financial Institution
branches
New York
London
Representative
Offices
Hong KongIndia
Bangladesh
Nepal
Pakistan
Egypt
Kuwait
Bahrain
Qatar
Mashreqbank heritage
14. 14
Structure and Leadership
Board of Directors
Chief Executive Officer
Corporate Banking
Group (CBG)
[24% of revenue]
Retail Banking
Group (RBG)
[28% of revenue]
Treasury & Capital
Markets (TCM)
[10% of revenue]
International
Banking Group (IBG)
[18% of revenue]
Corporate Affairs
(CA)
Audit , Fraud &
Compliance Group
(AFCG)
Risk
Management (RM)
Operations &
Technology (O&T)
Mashreqbank organization chart
15. 15
Structure and Leadership
> Large Corporate
> Emerging Corporate
> Contracting Finance
> Abu Dhabi Division
> Strategic Relationships
Mashreqbank is a universal bank that covers significant lines
of business with a full product and channel suite
Corporate Banking Group (CBG)
Offers wholesale banking
> Credit Products Group
> Medium Enterprises
> Global Transaction
Services
> Corporate Finance
> Islamic Banking products
> Personal Banking
> SME
> Mashreq Gold
> Private Banking
> Payments
> Islamic banking products
Retail Banking Group
(RBG)
Offers personal banking
> Distribution
> Alternate Channels
> Direct Sales
> Direct Banking Centre
> Marketing & Customer
Experience
> FX and Investments
> Rates & Structured
Solutions
> Mashreq Capital
> Islamic banking products
Treasury & Capital Markets
(TCM)
Offers treasury and investment products
> Equity Derivatives &
Institutional Sales
> Mashreq Securities
> Islamic Banking –
Product House
> Wholesale and investment banking
> Treasury and investment products
> Personal banking
> Financial Institutions globally
> Islamic banking products
International Banking Group
(IBG)
Offers banking services outside UAE
16. 16
Mashreqbank - Key subsidiaries
Mashreqbank Psc
Oman Insurance Company (63.65%)
> Largest insurance company in the UAE
> Provides full range of Insurance Products & Services
> Equity: AED 2,000 mn
> 2014 profit: AED 229 mn
Mashreq Al Islami Finance (99.8%)
> Islamic Finance Company
> Provides full range of Islamic Products & Services
> Equity: AED 604 mn
> 2014 profit: AED 51 mn
Mashreq Capital (100%)
> Registered in DIFC for Brokerage, Asset Management
and Fund Management services
> 3rd largest asset management in UAE with USD 800
mn in asset under management
> Funds rated highest in the market
> Equity: AED 49 mn
> 2014 profit: AED 24 mn
Mashreq Securities (99.98%)
> Securities brokerage Company registered at Dubai
Financial Market
> 3rd largest brokerage in UAE
> Equity: AED 161 mn
> 2014 Profit AED 65 mn
17. Corporate Banking (CBG) business
17
CBG Revenues [AED million]
CBG Assets [AED million]
Business highlights
> Corporate Banking Group comprises of corporate and
commercial banking customers in the UAE
> Major products offered include trade finance,
contracting finance, project finance, corporate advisory
and cash management
> 2014 saw strong performance in the areas of Corporate
Finance, Real Estate and Investment Services
> Successfully closed >13 multibank deals establishing
the best DCM platform amongst local / regional banks
● “Best Loan House in UAE” award from EMEA
Finance for the second year in a row
● #1 ranking for Thomson Reuters Middle East
2014 Book Runner Loan League Table
> Global Transaction Services (GTS) received many
important accolades in 2014
● EMEA Finance – Best Cash management Services
in the Middle East
● The Banker Middle East - Best Corporate Account
Product
● Celent Model Bank Awards – Cash Management
and Trade
29,617
26,026
21,922
+14%
+19%
201420132012
Structure and Leadership
1,429
1,288
1,127
+11%
14%
201420132012
18. Retail Banking (RBG) business
18
RBG Revenues [AED million]
RBG Assets [AED million]
Business highlights
> Retail Banking Group includes products and services
offered to individuals and small businesses in the UAE
> Products offered include current / savings / fixed
deposits, investment products, personal loans, auto
loans, mortgages, small business loans, credit cards
with unique loyalty programs, bank assurance, private
banking and wealth management
> Advances growth was led by Credit Cards, Mortgages,
Secured assets and Business Loans
> Fee income grew by 78% YoY led by significant
growth in Investments, Insurance and FX revenues
> Mashreq Internet Banking base recorded growth of
36% with historical growth in remittance of 92%
> Launched Mashreq Property Mart and SMEXchange to
serve relevant customers
> 7th largest Merchant acquirer in Middle East & Africa
with 21,000 POS machines spread over 12,200
merchants in the UAE
> Key innovations in 2014 include Tap n Go - UAE’s
first NFC-sticker solution, Payport - EMV compliant
mPOS solution, World’s first overseas online and
mobile top-up service
> Key awards include Best Regional Retail Bank by
Banker ME Industry Awards and Best Retail Bank
2014 by Global Banking & Finance Review Awards
14,061
11,899
8,390
+18%
+42%
201420132012
Structure and Leadership
1,286
1,096
1,626
+26%
17%
201420132012
19. Treasury and Capital Markets (TCM) business
19
TCM Revenues [AED million]
TCM Assets [AED million]
Business highlights
> Treasury and Capital markets business consists of
customer flow business and proprietary business
> Customer flow business includes transactions for FX,
derivatives, hedging, investment products, equities and
regional asset management undertaken on behalf of
customers
> Proprietary business includes trading and investing
activity undertaken on behalf of the Group
> 2014 witnessed robust growth in revenues supported
by a strong product suite and a 24 hour dealing room
> Brokerage business grew robustly driven by the growth
in equity capital markets
> Retail franchise grew in key products such as
brokerage and structured products
> Best in Class Asset Management:
● AED 5.0 bn in assets under management
● ~114% growth in income in 2014
● Makaseb Arab Tiger Fund won the ‘Best Equity
Fund’ in both 1-yr and 3-yr performance
categories for 2014
● Makaseb Income Fund won the ‘Best Fixed
Income Fund Award’ in both 1-yr and 3-yr
performance categories for 2014
13,69813,320
15,080
+3%-12%
201420132012
Structure and Leadership
453
334
599
+32%
36%
201420132012
20. 1,059
827
639
+28%
29%
201420132012
International Banking (IBG) business
20
IBG Revenues [AED million]
IBG Assets [AED million]
Business highlights
> International banking business consists of retail
and corporate business in Qatar, Egypt, Bahrain
and Kuwait and Financial Institutions business
in other locations including trade services,
reimbursements – arranging debt capital
market transactions, undertaking and financing,
export bill collections and risk participations
> In 2014, Hong Kong saw the upgrade of the
banking license to the status of a Tier 1 full-
fledged bank and launch of the new CORE
banking system
> Transaction Electronic Robust Mandate System
(TERMS) was implemented in Qatar, while
becoming IBN compliant
> Key awards 2014
● “Best Commercial Bank in Qatar” - World
Finance Magazine
● “Best Corporate Bank in Qatar” - Global
Banking & Finance Review
● “Best Bank Middle East” - IAIR Milan
Awards
28,548
15,75914,759
+81%
+7%
201420132012
Structure and Leadership
21. Islamic Banking (ISB) business
21
ISB Revenues [AED million]
ISB Assets [AED million]
Business highlights
> Mashreq Al Islamic is the Islamic Banking arm
of Mashreq (Mashreq Al Islami Finance
Company PJSC and Islamic Banking Division,
Mashreqbank PSC) and offers a wide range of
Shari’ah compliant products and services
> Amongst the top ten Islamic institutions in the
UAE based on market share as per MEED
> Products offered include Ijara home finance,
Mudarabah deposit and savings, Musharaka
finance, Murabaha commodity finance, Ijara
equipment finance, sukuk underwriting,
Musharaka LC, Murabaha LC, TR Murabaha,
Kafala, Wakala deposit, Reserve Murabaha
deposit and sukuk advisory
> Offerings for the retail customer include credit
card, home & auto finance and SME financing
> Key awards:
● “Best Islamic Window” in 2014, 2013,
2011 & 2010 by Islamic Business &
Finance
● “Most Innovative Islamic Banking
Solution Provider” by Global Banking &
Finance Review
6,5746,684
5,892
-2%+13%
201420132012
Structure and Leadership
259
180
311
+20%
44%
201420132012
22. Insurance business (Oman Insurance Company)
22
Gross written premium [AED million]
Net profit [AED million]
Business highlights
> Mashreqbank owns 63.65% of Oman
Insurance Company
> Oman Insurance Company (OIC) is the largest
insurance company in the UAE and the fourth
largest in the Middle East & North Africa
> Products offered include life, medical, motor,
marine cargo and hull, aviation, property, fire
and general accidents, engineering, energy,
liabilities and personal lines insurance
> Largest distribution network in the UAE; OIC
has 11 branches, with operations across all
Emirates in the UAE, the Sultanate of Oman,
Qatar and Turkey. In addition, OIC owns a
medical third-party administration company in
Iraq and has over 30 bank partners in the
region
> The company is rated ‘A-’ Positive Outlook by
Standard & Poor’s and ‘A Excellent’ Stable
Outlook by AM Best, supported by leading
multinational reinsurers such as Swiss Re, XL
Re and ACE Tempest Re
Structure and Leadership
3,249
2,920
2,443
+11%
20%
201420132012
229247
223
-7%11%
201420132012
23. Profile of Senior Management
23
Structure and Leadership
Abdul-Aziz Abdullah Al-Ghurair
Chief Executive Officer
• A Graduate of California Polytechnic State University, Mr.
Abdul-Aziz Al-Ghurair joined Mashreqbank , then Bank of
Oman, in 1977
• He worked in different Divisions and through rigorous
training in various assignments, Mr. Al-Ghurair climbed to
his current position as of March 1991
Ali Raza Khan
Head of Corporate Affairs
• Mr. Ali Raza Khan is a Member of the Institute of
Chartered Accountants of India (1978)
• Joined Mashreqbank in 1980; As Head of Corporate
Affairs, he is responsible for Finance, HR and
Administrative functions in the bank
John Iossifidis
Head of Corporate Banking Group
• Mr. John Iossifidis is an MBA and B.Ec (Acctg.) from
Monash University
• Joined Mashreqbank in 2009 after a successful career at
Standard Chartered Bank and ANZ
Farhad Dhun Irani
Head of Retail Banking Group
• Mr. Farhad Dhun Irani has an MBA from University of
Bombay
• Joined Mashreqbank in 2011 from PayPal in Asia
• Prior to this, he was Global Head, Credit Card and Personal
Loans at Standard Chartered Bank
Nabeel Waheed Shaikh
Head of Treasury & Capital Markets and Acting Head of
International Banking
• Mr. Nabeel Waheed Shaikh has a BSc from Syracuse
University, New York
• Joined Mashreqbank in 1996, from Bank of America,
Pakistan where he spent over 15 years and held various
positions including Head of Corporate Banking
• Mr. Paracha has a BSc from the University of Leeds. He
completed a General Management Program from HBS
• Joined Mashreqbank in 1995 from Deutsche Bank AG in
Pakistan
• Overall banking experience of approximately 20 years,
covering corporate banking, internal audit and compliance
Nasser A. Paracha
Head of Audit, Fraud & Compliance Group
Jose K Joseph
Head of Risk Management
• Mr. Jose Joseph is a Commerce Graduate and an MBA in
Finance from XLRI, India
• He joined Mashreqbank in October 2013
• Prior to joining Mashreqbank he spent over 28 years with
Citibank
Sandeep Chouhan
Head of Operations Division and Mindscape
• Mr. Chouhan has a Masters in Technology, Management &
Systems from IIT, Delhi, India
• Joined Mashreqbank in March 2015 from CBQ, Qatar
• Prior to this, he was CIO with Barclays and Morgan Stanley
25. Strategic Objectives
25
Strategy
Vision
“To provide
our
customers
the most
rewarding
banking
relation-
ships”
Mission
Being the
primary bank
to our
customers
Being the
employer
of choice
Being
relationship
based
Delivering
superior
service
Drive nationalization
6
Become primary bank
1
Strengthen Mashreqbank brand
2
Innovation as differentiator
3
Grow New-to-Bank
4
Ensure revenue and portfolio quality
5
Strategic Objectives
26. Strategy
Drive operational
efficiencies
> Leverage existing infrastructure to drive growth and returns
> Significantly improve efficiencies across the bank to bring cost/income
ratio in line with market
Strengthen risk
management and
asset quality
> Reduce charge-to-loans ratio in line with pre-crisis levels, through
continued focus on portfolio and asset quality
> Selective portfolio / asset sales as part of an ongoing portfolio balancing
strategy
Grow international
contribution
> Support franchise client needs internationally and international client
needs in our franchise by providing solutions to corporate clients across
network
> Provide cross border accessibility to clients, such as offshore booking
location for private and gold customers and non-resident proposition
across the network
> Maintain momentum in our core South Asia FI market and build scale in
Qatar, Egypt and Africa
Accelerate domestic
growth
> Win new customers and increase customer penetration through a
differentiated customer centric, service oriented approach and focus on
continued product innovation
> Leverage balance sheet strength and liquidity position to grow market
share
> Capitalize on leadership position in fee-generating businesses
Optimize balance
sheet
> Optimize liability mix to lower cost of funds and enhance margins
> Increase leverage and deploy liquid assets into higher yielding
opportunities
26
Business Objectives
27. Business segments outlook
Diversified earnings base with strong growth potential
27
Loans portfolio split as of December 2014
0.2%
2.5%
4.9%
5.1%
6.8%
9.9%
10.4%
12.9%
22.2%
25.2%
Other
Financial institutions
Transport & Comm.
Construction
Manufacturing
Islamic finance
Services
Govt / Public sector
Trade
Personal
Strategy
> UAE Retail: Significant pick up in mortgage business and
continued growth in the UAE SME market, the second largest
market in the GCC; strong growth in cards, consumer loans
and wealth management
> UAE Corporate: Strong growth from trade, manufacturing,
tourism and logistics, driving overall UAE GDP in the coming
years leading to increased demand for credit & trade services
> International Banking: Robust regional trade flows and
lending opportunities in higher growth countries such as
Qatar and Egypt
> Insurance: As the largest insurance company in the UAE,
Mashreqbank’s Oman Insurance Company (OIC) subsidiary is
expected to capitalize and benefit greatly from this growth
Revenue split as of December 2014 Asset split as of December 2014
5.3%
8.4%
10.3%
18.1% 24.5%
27.8%
5.6%
Islamic
Insurance
Treasury & Capital markets
International Banking
Corporate
Retail
Others
7.2%
10.2%
13.4%
14.3%
54.8%
Other assets
Financial Investments
Interbank deposits & balances
Cash and balances with Central Bank
Loans & Advances
28. Innovation
Strategic advantage through innovation
28
Mashreqbank was the first bank in the UAE to:
> Introduce consumer loans
> Install ATM cash dispensers
> Issue debit/credit cards
> Introduce Point-of-Sale terminals
> Offer Visa Connectivity across the world
> Centralize foreign trade services
> Offer a direct banking centre
> Introduce a comprehensive corporate cash management solution offering (GTS)
> Introduce “Tap & Go”, mobile NFC sticker payment method
> Introduce “E cube retail branch” concept in distribution
> Launch UAE’s first fully EMV Chip & PIN compliant mobile POS solution
Strategy
30. 30
Financial track record
Net loans and advances [AED billion]
Net profit [AED million]
> Growth-led strategy with a focus on
portfolio quality, balance sheet
structure optimization, improved cost
efficiencies and higher infrastructure
utilization
> Significant expansion on the back
of buoyant macroeconomic
conditions
Growth & Expansion
> Prudent management focused on strengthening
the bank, de-risking and conserving capital
● Balance sheet de-risking and de-leveraging
● Strengthening capital and liquidity position
● Enhancing risk management functions
Crisis & Risk Management Accelerated Growth & Profitability
Solid performance over the past decade
2,401
1,806
1,312
8208031,000
1,6431,901
1,5711,739
751601505
20092008200720062005200420032002
+14%
20142013201220112010
58
50
413841
48
55
3529
22181513
+14%
2014201320122011201020092008200720062005200420032002
+33%
+15%
31. 31
Financial track record
Loans & Advances [AED billion] Customer deposits [AED billion]
Total Revenue [AED billion]
58.0
50.4
41.4
37.7
15%16%
2014201320122011
68.5
58.6
47.545.4
17%14%
2014201320122011
Net profit [AED billion]
Rapid improvement in performance over the last three years
1,886 2,103
2,393
2,720
21%
5,845
12%
4,837
2013
3,1252,445
20142012
1,982
4,084
2011
3,872
1,986
Fee and other income Net interest income1)
6.8% 10.3% 13.1% 15.7%ROE
1,806
1,312
820
2,401
48%
2013
33%
2012 20132011
1) NII component booked under net investment income as per IFRS, reclassified under NII
32. Strong capital adequacy, high liquidity, improved portfolio
quality and enhanced returns
32
Tier I Capital Ratio
Total Capital Ratio
Efficiency Ratio
Liquid Assets to Total Assets
Advances to Deposits
Financial track record
NPL Coverage Ratio
NPL to Gross Advances
ROA
Net Interest Margin
ROE
Capital adequacy
Liquidity
Asset quality
Performance
16.4%
18.1%
42.2%
26.5%
86.1%
31 Dec 2013
96.1%
5.1%
2.2%
2.9%
13.1%
49.5%
17.2%
19.3%1)
45.4%
27.4%
87.3%
31 Dec 2012
56.6%
9.4%
1.7%
2.6%
10.3%
51.5%Fee and other income to total income
15.3%
16.6%
37.8%
27.7%
84.8%
31 Dec 2014
120.4%
3.7%
2.5%
3.2%
15.7%
46.5%
1) Ministry of Finance debt repaid in 2012
33. 33
Financial track record
Operating leverage
Liquidity
2014
28%
2013
27%
2012
27%
2011
31%
2014
85%
2013
86%
2012
87%
2011
83%
Loan to Deposits
Funding as of 31 December 2014
77.0%
Customer deposits
Other Loans
8.5%
Med. Term FRN
4.5%
Others
0.7%
9.2%
Due to Banks
Well-funded balance sheet …
Liquid Assets to Total Assets
34. 34
Financial track record
Risk weighted assets
Capital adequacy [%]
Tier 1 and Tier 2 capital
2013
18.1%
16.4%
2012
19.3%
17.2%
2014
15.3% 16.6%
Total Capital ratio
Tier I Capital ratio
88,975
77,821
20132012 2014
106,628
13,388 14,578 16,277
2013
16,146
1,568
17,726
2014
1,450
2012
15,043
1,655
Tier 2 capitalTier 1 capital
…along with stable adequacy
35. 35
Financial track record
Total loans [AED bn]
Total revenue1) [AED bn]
Total assets [AED bn]
Total deposits [AED bn]
90
18.1%
106
+9.8%
DXB AUH
1,566 569 998
1,427 530 897
Peer group1) Mashreqbank
58
50
+15.1%+8.7%
DXB AUH
989 377 612
910 347 563
Peer group1) Mashreqbank
68
59
+16.9%+9.4%
DXB AUH
1,070 407 663
978 373 605
Peer group1) Mashreqbank
+20.8%
5.8
4.8
+13.7%
DXB AUH
61.3 26.0 35.3
53.9 21.6 32.3
Peer group2) Mashreqbank
1) Peer group includes 9 banks: ENBD, NBAD, ADCB, FGB, CBD, UNB, ADIB, DIB and RAK
Dec ‘13
7.3% 11.2% 8.6% 8.7%
9.3% 9.5% 20.3% 9.3%
Dec ‘14
Dec ‘13
Dec ‘14
Dec ‘13
Dec ‘14
Dec ‘13
Dec ‘14
Source: Banks’ financial statements
Market outperformance in 2014 – Growing faster than all
peers
36. 36
Financial track record - FY ’14 [AED billion]
Bank
NBAD
UNB
Total assets
RAK
ADIB
DIB
Mashreq
363
124
212
204
47
112
93
106
35
376
Total loans (net) Total deposits
Growth vs
Dec’13
CBD
18%
7%
8%
11%
7%
16%
9%
6%
5%
16%
64
73
246
74
140
32
141
194
24
58 15%
7%
18%
7%
11%
6%
32%
3%
6%
11%
67
85
258
32
243
141
126
92
25
68 17%
4%
12%
9%
2%
15%
17%
8%
4%
7%
Growth vs
Dec’13
Growth vs
Dec’13
Market position in UAE
DubaibasedbanksAbuDhabibasedbanks
ENBD
First Gulf
ADCB
37. Market position in UAE – 2nd in Dubai, Top 5 in the UAE
37
Bank Revenue – FY’14 [AED bn]
YoY
growth
10.4
14.7
3.6
3.5
4.6
2.2
5.8
5.6
9.2
7.5
21%
9%
17%
3%
10%
11%
32%
20%
10%
13%
Bank Net profit – FY’14 [AED mn]
1,455
1,201
1,750
2,003
4,050
5,579
5,656
5,139
2,661
2,401 33%
YoY
growth
21%
15%
20%
18%
18%
65%
58%
19%
2%
NBAD
UNB
RAK
ADIB
DIB
Mashreq
CBD
Financial track record - FY ’14 [AED billion]
DubaibasedbanksAbuDhabibasedbanks
NBAD
UNB
RAK
ADIB
DIB
Mashreq
CBD
ENBD
First Gulf
ADCB
First Gulf
ADCB
ENBD
39. 39
Trading history
Feb-14 Feb-15
1) Based on price as of February 26,2015; EPS and Book value as of December 2014
Source: DFM
Mashreqbank’s trading price – LTM [February 2014 – February 2015]
Trading performance over the last 1 year
Key multiples – Mashreqbank1)
FY 2014 P/E 10.2x
Current P/B 1.5x
June 2014: UAE included
in MSCI Emerging
Markets Index
0
50
100
150128
3,931
0
2,000
4,000
6,000
Mashreq
DFM General Index
12 month performance
Mashreqbank 18%
DFM GI (8%)
41. 41
>No of shares in issue: 169 million
>Market cap at February 26, 2015: AED 21.6 billion
>Free float: 13%
>Foreign ownership limit: 49%
Rating Agency Long term Short term
Baa2 P-2
BBB+ A-2
A F1
A- A1
Credit rating
43. 43
Corporate Governance
Mashreqbank is regulated by the UAE Central Bank and
follows international banking standards
Supervisory Authority
> Mashreqbank’s home supervisory authority is the UAE Central Bank which is
responsible for licensing, monitoring and supervising banks, finance companies
and exchange companies in the UAE
> Internationally, Mashreqbank comes under the purview of respective country
regulators such as the Federal Reserve and NY-SBD in the USA and Prudential
Regulation Authority & Financial Conduct Authority in the UK
Basel II and III
> Banks are expected to follow the Standardized
Approach for both credit and operational risks.
Migration to Foundation Internal Ratings Based
Approach (“IRB”) for Credit Risk is expected
> Basel III is under implementation in line with the
Basel III schedule (by 2019)
Accounting Standard
> The Central Bank made it mandatory in 2000 for all
Banks to publish their Annual Financial Statement as
per International Financial Reporting Standards (IFRS)
Bank monitoring - liquidity
> Cash ratio requirements (1% on Time Deposits and
14% on Demand Savings and Call deposits)
> Maintenance of 1:1 ratio is mandatory, i.e. utilization
of funds should not exceed stable sources
> As per Basel III, liquidity coverage ratio (Jan 2015)
and net stable funding ratio (Jan 2018) is under
implementation; in the meantime Central Bank has
introduced ‘liquid assets ratio’, to be implemented
from June 2014 onwards
Credit Limit
> Lending limits fixed by the Central Bank in relation to
capital:
● Lending to large private borrowers: 25% (10% for
funded)
● Commercial entities of Federal Govts and UAE Local
Govts: 25% (15% for funded), 100% aggregate
● UAE Local Govts and non-Commercial entities: 25%
Individual, 100% aggregate
44. 44
Corporate Governance
Corporate Governance
Board Supervision
> The Bank’s Board consists of 7 Directors
> The Chairman and 5 Directors are Non-Executive Directors and only the CEO is an Executive Director
> 2 independent directors
> The Board of Directors meet at least once every quarter
> Management issues are raised at Board level where the bank’s senior management presents details
to the Board
Board Committees
> Audit Committee
> Remuneration Committee
Management Supervision
> The Leadership Forum (reporting to the CEO) is the Executive Management Committee of the Bank
which discusses and debates bank-wide issues, develops strategic plans for the Board’s approval and
takes decisions on pan-bank issues
46. 46
> Gallup Great Workplace Award
> Banker ME Industry Awards - Best Regional
Retail Bank
> Islamic Business & Finance Awards - Best
Islamic Window
> CSR Label – Dubai Chambers – 2014
> EMEA Finance ME Banking Awards
• Best Local Bank in the UAE
• Best Regional Investment Bank in the
ME
• Best Loan House in the UAE
> Banker Middle East Product Awards
• Best Call Centre
• Best Corporate Account
• Best Customer Service – Retail
• Best Fixed Income Fund
• Best Web/Mobile site
> Global Banking & Finance Review Awards
• Most Innovative Islamic Banking
Solution Provider
• Best Corporate Bank Qatar 2014
• Best Customer Service Bank Qatar
2014
• Best Retail Bank UAE 2014
• Most Innovative Banking Product
(Mashreq Max) UAE 2014
Accolades in 2014
> IAIR Banking Awards - Best Bank in UAE
• International Finance Magazine
• Best Internet Bank in UAE
• Best Online Bill Payment in UAE
> World Finance Banking Awards
• Best Investment Bank - UAE
• Best Commercial Bank – Qatar
> The ME Excellence Awards 2014
• Financial Market Trading
Automation and System
Excellence Award
> MasterCard Innovation Forum 2014
• Best Use of Innovative
Technology’ in the ME & Africa
> EMEA Finance – ME Banking Awards
• Best Cash Management in the ME
> Celent Awards
• Best Cash Management and Trade
award
> Gulf Business Industry Awards
• Innovator of the Year – H.E.
Abdulaziz Al Ghurair
> First Bank in UAE to achieve IIA
Conformance
> Asian Business Leadership Forum -
Business Excellence Award
