Meezan Bank Limited · • EPS –on enhanced share capital of Rs 11.7 bn - Rs 7.67 vs Rs 5.56 last...
Transcript of Meezan Bank Limited · • EPS –on enhanced share capital of Rs 11.7 bn - Rs 7.67 vs Rs 5.56 last...
Meezan Bank LimitedUnlocking the True Potential of Islamic Banking
ANALYST BRIEFING -
2018
2Meezan Bank: Performance At a Glance –Balance Sheet Grew by 19% in 2018
• Total Assets of the Bank increased to Rs 938 bn vs Rs 789 bn last year - a growth of 19% (Rs 149 bn)
• Bank’s Financing crossed half a trillion grew to Rs 513 bn vs Rs 420 bn last year – a growth of 22%;
• The growth in financings was in all segments i.e. Corporate:14%, SME/Comm:44% & Consumer :41%;
• ADR of the Bank – 65% vs 63% last year;
• NPL infection ratio dropped to 1.3% vs 1.5% in 2017 and banking industry average of 8%;
• NPL Coverage ratio increased to 139% vs 133% in 2017
• Investments and placements grew to Rs 309 bn vs 266 bn last year – a growth of 16%
• Bank’s Deposits grew to Rs 785 bn vs Rs 667 bn last year – a growth of 18% vs industry growth of 8%;
• Current account deposits grew by 23% YoY;
• Equity grew by 15% to Rs 40 bn vs Rs 35 bn in 2017.
3Meezan Bank: Performance At a Glance – Profit After Tax Grew by 42% in 2018
• PAT 2018: Rs 8.96 bn ($ 64.5 mn) vs Rs 6.31 bn ($ 45.5 mn) – a growth of 42% (Rs 2.6 bn);
• EPS – on enhanced share capital of Rs 11.7 bn - Rs 7.67 vs Rs 5.56 last year;
• Return on Average Equity – 23.77% vs 19.26% last year;
• Net spread : Rs 28 bn vs Rs 21 bn last year due to higher volume of earning assets & its re-pricing;
• Fee , commission and other income increased to Rs 5.6 bn vs Rs 4.4 bn in 2017– a growth of 26%;
• Trade Business Volume crossed Rs 1 Trillion vs Rs 710 bn – a growth of 43%;
• Admin expenses - Rs 19.7 bn (17% up from last year) mainly due to opening of 59 new branches;
• No of Branches: Opened 59 new branches reaching 660 vs 601 last year (181 cities vs 159 cities);
• Cost to income ratio: Improved by 4% to 55% vs 59% last year.
Meezan Bank: Deposit Increased by 18% in 2018 as against 8% growth in Banking Industry
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Rs in Bn
117,930
148,701
195,679
235,908
289,421
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50,000
100,000
150,000
200,000
250,000
300,000
350,000
CY14 CY15 CY16 CY17 CY18
Current Account Deposits
4 YR - CAGR 25%
67%
28%
2%1% 2%
Individuals - 67%
Private Sector - 28%
Government - 2%
NBFIs - 1%
Others - 2%
Deposit Composition
28% 28% 25% 25% 27%
41% 40% 40% 40% 36%
31% 32% 35% 35% 37%
0%
20%
40%
60%
80%
100%
CY14 CY15 CY16 CY17 CY18
Deposit Mix
Fixed Savings Current
Meezan Bank: Leading the Islamic Banking Industry with 35% share of deposit– 9M’2018
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• In an industry of Rs. 2.0 trillion deposits, Meezan Bank is at a leading position with 35% share of total deposits of Islamic Banking Industry
Rs in Bn
CY18 Industry data not available
30%
31%
32%
33%
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35%
36%
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1,500
2,000
2,500
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Bank's Growth in Comparison with Islamic
Banking Industry
Total Islamic Banking Deposits
Meezan Bank Deposits
Meezan Bank as % of Islamic deposits
Meezan Bank
35%
4 Other
Islamic Banks
27%
16 Islamic
Windows of
Conventional
Banks
38%
Share of Islamic Banking Industry
Meezan Bank: Financings crossed Half a Trillion – 22% Growth YoY
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110%
116%
118%
133% 139%
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120%
140%
160%
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Asset Quality
Provisions held Non Performing Loans NPL Coverage
3.8%
3.3%
2.1%
1.5%
1.3%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
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Non Performing Loans & Infection Ratio
Non Performing Loans Advances Infection Ratio
46 44
56 63 65
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ADR - %
68
19
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Financing Mix
Corporate
SME / Commercial
Consumer
Staff
Non - funded Income CY18 CY17 Growth %
Trade Business Volume Rs 1 Trillion Rs 710 Billion 43
Non Funded Income
Trade related fees & guarantee commissions 1,913 1,356 41
Branch banking fees 1,483 1,189 25
Debit card fees 1,123 809 39
Investment banking fees 233 304 (23)
Home remittance fees 151 100 52
Credit processing fees 123 85 44
Cash management fees 45 26 74
Others 499 542 (8)
5,569 4,412 26
Meezan Bank: Fee income Grew by 26% with Trade Business Volume over Rs 1 Trillion
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Rs in Bn
Profit & Loss Account 2018 2017 Growth %
Net spread earned 28,168 20,743 36%
Fee and commission and other income 5,569 4,412 26%
Foreign exchange income 1,318 1,211 9%
Dividend income and capital gain 575 2,001 (71%)
Operating income 35,630 28,367 26%
Administrative and other expenses (19,670) (16,832) 17%
Profit before tax and provisions 15,960 11,535 38%
Total Provisions (1,168) (1,283) (9%)
Profit before tax 14,792 10,252 44%
Taxation (5,830) (3,939) 48%
Profit after tax 8,962 6,313 42%
Earnings per share - on enhanced capital – Rs 7.67 5.56 38%
Number of branches 660 601 10%
8Meezan Bank: 2018 Results – 42% Growth in Profitability
Rs in Mn
Balance Sheet CY18 CY17 Growth %
Cash and Bank Balance 73,277 69,451 6
Due from FI under Bai Muajjal 184,815 147,229 26
Investments 123,743 119,238 4
Financings 512,565 420,029 22
Fixed and Intangible Assets 13,753 11,876 16
Other Assets 29,763 20,984 42
Total Assets 937,915 788,807 19
Bills Payable 23,751 17,175 38
Due to FIs 36,408 36,813 (1)
Deposits 785,477 667,181 18
Sub-ordinated Tier II Sukuk 7,000 7,000 -
Additional Tier I Sukuk 7,000 - 100
Other Liabilities 37,947 25,561 48
Total Liabilities 897,583 753,730 19
Net Assets 40,333 35,077 15
Paid-up Capital 11,692 10,629 10
Reserves/Retained Profit 28,687 23,709 21
Revaluation Surplus (46) 739 (106)
Total Equity 40,333 35,077 15
9Meezan Bank: 2018 Results – 18% Deposit Growth vs Banking Industry Growth of 8%
Rs in Mn
Profit and Loss Account CY18 CY17
Islamic Financings as % of deposits (ADR) 65.26 62.96
Non-performing financing to Gross Islamic financing - % 1.34 1.54
NPL Coverage Ratio - % 139 133
Tier I CAR - % 12.09 9.94
Total CAR - % 14.55 12.89
Book value per Share - on enhanced capital- as at Dec 31, - Rs 34.50 30.00
Expense to gross income ratio - Total - % 55.21 59.34
Earnings per share - on enhanced capital after Bonus Issue - Rs 7.67 5.56
Return on Average Equity - (ROAE) - % 23.77 19.26
Return on Average Assets - (ROAA) - % 1.04 0.87
Dividend Payout - % 45 30
Cash Dividend - % 35 30
Bonus Issue - % 10 -
10Meezan Bank: Key Ratios 2018 vs 2017 with ROE of 24%
Meezan Bank: Unconsolidated Profit And Loss Account - 2014 - 2018
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Rs in million
P&L Statement CY14 CY15 CY16 CY17 CY18
Target rate 10.0% - 9.5% 9.5% - 6.0% 6.0% - 5.75% 5.75% 7.11%
Profit / return earned 28,487 32,894 31,027 36,427 48,624
Profit on deposits & others (15,539) (15,181) (13,238) (15,684) (20,457)
Net Spread earned 12,948 17,713 17,789 20,743 28,167
Other income 4,819 4,588 5,723 7,624 7,463
Total Revenue 17,767 22,301 23,512 28,367 35,630
Operating Expense (10,402) (13,314) (14,787) (16,832) (19,670)
Profit Before Provisions 7,365 8,987 8,725 11,535 15,960
Provisions and write offs - net (467) (535) 218 (1,283) (1,168)
Profit Before Provisions 6,898 8,452 8,943 10,252 14,792
Taxation (2,328) (3,429) (3,381) (3,939) (5,830)
Profit After Tax 4,570 5,023 5,562 6,313 8,962
YoY Growth 15% 10% 11% 14% 42%
Earnings per share - Rs 4.56 5.01 5.45 5.56 7.67
Dividend per share - Rs 27.5%(C) 30%(C) 30%(C) 30%(C) 35%(C) & 10%(B)
Meezan Bank: Unconsolidated Balance Sheet – 2014 - 2018
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Rs in million
Balance Sheet CY14 CY15 CY16 CY17 CY18
Cash and Bank Balance 35,230 54,861 68,058 69,451 73,277
Due from FIs 90,766 101,079 129,115 147,229 184,815
Investments 114,089 146,305 130,156 119,238 123,743
Advances 175,712 207,569 311,530 420,029 512,565
Fixed and Intangible Assets 6,273 8,057 8,925 11,876 13,753
Other Assets 18,079 17,993 14,271 20,984 29,763
Total Assets 440,149 535,864 662,055 788,807 937,915
Bills Payable 7,298 10,100 13,757 17,175 23,751
Due to FIs 15,465 13,610 32,006 36,813 36,408
Deposits 378,744 468,281 559,398 667,181 785,477
Sub-ordinated Sukuk - - 7,000 7,000 14,000Other Liabilities 14,752 17,526 19,421 25,561 37,947
Total Liabilities 416,259 509,517 631,581 753,730 897,583
Net Assets 23,890 26,347 30,474 35,077 40,333
Paid-up Capital 10,027 10,027 10,027 10,629 11,692
Reserves/Retained Profit 13,247 15,530 18,122 23,709 28,687Revaluation Surplus 616 790 2,325 739 (46)
Total Equity 23,890 26,347 30,474 35,077 40,333
Meezan Bank: Consolidated Profit After Tax Grew by 59% of Rs 8.96 Billion
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Rs in Bn
Profit & Loss account CY18 CY17 Growth %
PSX - 100 Index 37,067 40,471 (8)
Net spread earned 28,176 20,753 36
Fee, commission, forex & other income 8,454 7,627 11
Div idend income and capital gain 203 1,227 (83)
8,657 8,854 (2)
GROSS BANKING INCOME 36,833 29,607 24
Administrative and other expenses (20,187) (17,427) 16
16,646 12,180 37
Share of result of associates before taxation (298) (963) (69)
PROFIT BEFORE PROVISIONS 16,348 11,217 46
Total provisions - net (1,168) (1,284) (9)
PROFIT BEFORE TAX 15,180 9,933 53
Taxation (6,046) (4,153) 46
PROFIT AFTER TAX 9,134 5,780 58
Non Controlling Interest (176) (161) 9
PROFIT AFTER TAX AND NON CONTROLLING INTEREST 8,958 5,619 59
EPS - on enhanced capital - Rs. 7.66 4.95 55
About Bank’s Subsidiary-Al Meezan Investments
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Since its inception in 1995, it has the distinction of being the only AMC in Pakistan with the exclusive mandate of providing Shariah compliant investment solutions to its investors
Shariah Board consists of members who are playing the leading role in the development of Islamic Finance worldwide
Manages the largest Open end Equity fund & Voluntary Pension Fund (VPS) in the private sector with AUM of Rs. 33 Bn and Rs. 9 Bn respectively
One of the largest private sector AMCs currently managing over Rs. 102 Bn with longest track record of over 23 years of experience in Asset Management and Investment Advisory
Has one of the largest investor base of over 91,615 investors along with the consistently high performing funds providing competitive returns
Longest track record of managing discretionary portfolios along with advisory services to the renowned local and international clients
AM1 Rating (from JCR-VIS), the first AMC to be awarded the highest possible management quality rating
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Developed the first Shariah Compliant Index (KMI-30) in collaboration with KSE (now PSX)8
Meezan Bank: Performance of its Subsidiary
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Al Meezan Investments Management Ltd Unit CY18 CY17 ∆ %
Assets Under Management –incl. discretionary portfolio Rs Bn 102 100 2%
Number of Funds # 16 14 14%
Number of Funds -including plans # 28 25 12%
Number of Branches # 23 18 28%
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Break-down of AUMs by Investor Category
Meezan Bank: Performance of its Subsidiary
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