Financial Performance · for Islamic Banking Window of the Year’ & ‘Silver Award for Islamic...
Transcript of Financial Performance · for Islamic Banking Window of the Year’ & ‘Silver Award for Islamic...
Financial Performance
9 M 2018
2
Net Operating Income - Bank
Interest Income
Interest Expenses
NII
Net Fee Income
Trading Gain/Loss
Net Gain from Financial
Investments
Other Operating Income
9 M 2018
(Rs Bn)
9 M 2017
(Rs Bn) Growth
%
78.4
(44.2)
34.2
6.8
(1.2)
0.2
3.4
71.5
(41.9)
29.6
6.1
(2.8)
0.2
2.8
9.6%
5.5%
15.5%
10.8%
55.3%
7.0%
23.3%
3
Expenses & Profits - Bank
Impairment
Net Operating Income
Operating Expenses
VAT & NBT
PBT
Income Tax
PAT
9 M 2018
(Rs Bn)
9 M 2017
(Rs Bn) Growth
%
(3.6)
39.8
(16.0)
(4.5)
19.3
(6.2)
13.1
(2.3)
33.7
(14.6)
(3.7)
15.4
(4.5)
10.9
57.3%
18.2%
10.0%
21.0%
25.4%
37.0%
20.6%
4
Net Operating Income - Group
Interest Income
Interest Expenses
NII
Net Fee Income
Trading Gain/Loss
Net Gain from Financial
Investments
Net Insurance Premium
9 M 2018
(Rs Bn)
9 M 2017
(Rs Bn) Growth
%
84.7
(46.0)
38.7
7.3
(1.3)
0.3
5.5
77.1
(43.2)
33.9
6.7
(2.7)
0.2
4.6
9.8%
6.4%
14.1%
9.3%
54.1%
35.5%
17.9%
Other Operating Income 3.6 2.5 42.1%
5
Expenses & Profits - Group
Impairment
Net Operating Income
Operating Expenses
VAT & NBT
PBT
Income Tax
PAT
9 M 2018
(Rs Bn)
9 M 2017
(Rs Bn) Growth
%
(4.2)
49.9
(23.7)
(4.8)
21.5
(4.5)
14.5
(2.9)
42.3
(21.6)
(4.0)
16.8
(3.2)
11.8
43.6%
17.9%
9.7%
19.4%
28.1%
41.1%
22.7%
Profit Attributable to
Shareholders 13.9 11.3 22.7%
6
Financial Performance – Bank
Rs Bn
+15.5% +10.8%
+1021.4% +57.3%
+10.0%
+29.8%
+20.6%
7
10.9
13.1
4.6
0.7
2.2 1.3
1.5
2.4
-
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
PAT 09M 17 NII Net FeeIncome
Other Income Impairment Opex Taxes PAT 09M 18
Financial Performance – Group
Rs Bn
+14.1% +9.3%
+73.0% +43.6% +9.7%
+31.3%
+21.8% +22.7%
8
11.3
13.9
4.8
0.6
3.5 1.3
2.1
2.8
0.1
-
5.0
10.0
15.0
20.0
25.0
PAS 09M 17 NII Net FeeIncome
OtherIncome
Impairment Opex Taxes MinorityInterest
PAS 09M 18
Profitable Balance Sheet Growth
Group & Bank balance sheets above a
Trillion
09 month loan growth of 12.3%, Deposits up 10.7%
Bank lending book surpasses Rs 700 Bn in 3Q
9
-
200
400
600
800
1,000
2014 2015 2016 2017 09M17
09M18
Asset Growth
Bank
Group
CAGR
Bank 18.6%
Group 19.1%
YoY
Bank & Group
8.6%
Rs Bn
-
100
200
300
400
500
600
700
800
2014 2015 2016 2017 09M17
09M18
Loans & Deposits
Advances
Deposits
Rs Bn
CAGR
Loans 17.3%
Deposits 18.7%
YoY
Loans 14.8%
Deposits 10.9%
Profitable Balance Sheet Growth
Bank NIM up by 25 bps during quarter, Group by 23 bps
Exposure to higher yielding segments
Bank 16.0% YoY
Group 14.8% YoY
Bank 5.31%
Group 5.74%
10
64%
36%
LKR Deposit Mix
Other
CASA
44%
56%
Lending Mix
Large Corporates
Retail & MSME
3.0%
3.5%
4.0%
4.5%
5.0%
5.5%
6.0%
Q32017
Q42017
Q12018
Q22018
Q32018
NIM Growth
Bank
Group
5
7
9
11
13
15
Q32017
Q42017
Q12018
Q22018
Q32018
NII Growth (Rs Bn)
Bank
Group
Fee Income
Leadership in card merchant acquiring business with 45% of market share
Strong growth in core sources of Credit Cards and Trade Finance
Fees contribute 16% of total operating income
Rs Bn
11
18%
31% 22%
11%
11% 7%
Sources of Fees
Loans
Cards
Trade and remittances
Deposits
Guarantees
Others -
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
2014 2015 2016 2017 09M17
09M18
Fee Income Growth
Bank
Group
YoY
Bank 10.8%
Group 9.3%
CAGR
Bank 19.4%
Group 21.1%
Operational Excellence
100% of retail applications processed centrally
Centralized Disbursements
Central Security Repository
Paperless Office Systems
Group Cost to Income improves nearly
400 bps YoY to 43.9%
Bank’s Cost to Income better by 360 bps YoY to 36.9%
12
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
50.0%
55.0%
60.0%
2014 2015 2016 2017 09M 18
Cost to Income
Bank
Group
-
1.0
2.0
3.0
4.0
5.0
6.0
-
10.0
20.0
30.0
40.0
50.0
60.0
70.0
2014 2015 2016 2017 09M 18
Efficiency
Profit/Branch Profit/Staff (RHS)
Rs Mn Rs Mn
Risk and Compliance
Specialization via Centralized Credit Underwriting
Centralized Collection System
Cyber & Information Security, Data Loss
Prevention/Data Classification
Gross NPA slid from Dec 2017 with collections
across industry coming under pressure from
sluggish growth & volatile weather
13
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
2014 2015 2016 2017 09M 18
Gross NPA
3.10%
0.0%
1.0%
2.0%
3.0%
4.0%
Quarterly Gross NPA
9% 11%
6%
18%
18%
10%
9%
12% 7%
Diversified Loan Book
Agriculture
Manufacturing
Tourism
Construction & Infrastructure
Trade
Financial Services
Health Care & Support Services
Consumption
Others
Risk and Compliance
Healthy Balance between sound capitalization & growth
Total Tier I Capital at 13.02%, 427 bps higher than Basel III Minimum
Total Capital Ratio at 15.62%, 275 bps better than Basel requirement
Higher
minimum of
8.75% owing
to BASEL III
14
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
2014 2015 2016 2017 09M 18
Total Tier I Capital
HNB Reg Min
Surge in FY 17 due to Rights
correcting on loan growth
-
20
40
60
80
100
120
140
0.0%
5.0%
10.0%
15.0%
20.0%
2014 2015 2016 2017 09M 18
Total Capital
Capital (RHS) Total Capital Ratio Reg Min
Rs Bn
Profitability
Bank ROA up 16 bps YoY to 1.76%.
Group by 19 bps to 1.84%.
Higher capital and resulting lower leverage
impacts ROE marginally; Reported at
15.57%
Group ROE up 23 bps YoY to 14.62%.
15
1.00%
1.20%
1.40%
1.60%
1.80%
2.00%
2014 2015 2016 2017 09M 18
ROA
Bank Group
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
2014 2015 2016 2017 09M 18
ROE
Bank Group
DuPont Analysis – Bank
ROE
15.57% (16.12%)
ROA
1.76% (1.60%)
NII
4.58% (4.36%)
Other income
1.23% (0.93%)
Impairment
0.48% (0.34%)
Operating Costs
2.15% (2.14%)
Taxation
1.43% (1.21%)
Leverage Multiplier
8.85x (10.06x)
09M 2018
09M 2017
16
DuPont Analysis – Group
ROE
14.62% (14.39%)
ROA
1.84% (1.65%)
NII
4.92% (4.74%)
Other income
1.97% (1.60%)
Impairment
0.53% (0.41%)
Operating Costs
3.02% (3.03%)
Taxation
1.50% (1.26%)
Leverage Multiplier
8.28x (9.09x)
09M 2018
09M 2017
17
Shareholder Return – 12 Months to Nov 2 2018
EPS (Rs) 37.67
BVPS (Rs) 266.39
PBV (X) 0.83
PE (X) 5.84
DPS (Rs) 8.50
Dividend Yield (%) 3.9 (N) & 5.2 (X)
Voting 09M TSR(%) (8.2)
Non Voting 09M TSR
(%)
(11.5)
ASPI (%) (8.0)
18
0
50
100
150
200
250
300
11/2
/2017
12/2
/2017
1/2
/2018
2/2
/2018
3/2
/2018
4/2
/2018
5/2
/2018
6/2
/2018
7/2
/2018
8/2
/2018
9/2
/2018
10/2
/2018
11/2
/2018
12 Month share Prices (Rs)
Voting
Non Voting
Awards & Accolades 2018
• 'No. 1 Bank in Sri Lanka’ in Banker Global Top
1000 ranking
• ‘Best Retail Bank in Sri Lanka’ for the 10th time by
The Asian Banker
• ‘Best SME Bank’ & ‘Best Digital Bank’ in Sri
Lanka by Asiamoney
• ‘Best Cash Management Bank’ in Sri Lanka by
Asian Banker, Asiamoney and Euromoney
• Gold Award Banking Category & Overall Runner
Up - ACCA Sri Lanka Sustainability Reporting
Awards
• ‘Islamic Finance Entity of the Year’, ‘Gold Award
for Islamic Banking Window of the Year’ &
‘Silver Award for Islamic Finance Deal of the
Year’ – Sri Lanka Islamic Banking & Finance
Industry Awards
• ‘Silver Award for Investor Relations from CFA Sri
Lanka
• Best Private Sector Organization for Promoting
Women in the Workplace – Top 50 Professional &
Career Women Awards 2018
19
Thank you
Investor Relations Team
Hatton National Bank PLC
Level 16, HNB Towers
479, T B Jayah Mawatha
Colombo 10
Sri Lanka
Email : [email protected]
Tel : +94 112 661555/1177
20