05.11.2012, mongolian banking sector analysis, mr. randolph koppa

Mongolian Banking Sector Analysis

From BOM report end of Sep 2012

BCM Meeting Nov 5, 2012

Randolph S. Koppa

President

BANKING SECTOR ANALYSIS

Total assets growth in banking sector

Total assets growth in banks

End of Sep 2012

Total assets calculated by distinction from financial derivatives and total assets each banks.

21.3%

41.6%

47.9%

15.2%

22.4%

66.3%

56.1%29.1%

0

2000

4000

6000

8000

10000

12000

2009 2010 2011 2012.09

MN

T b

ln.

Banking sector TDB

2091

2239.62130.9

822.5

1947.1

2698.9

2456.52312.2

939.1

2229.8

0

500

1000

1500

2000

2500

3000

TDB Khaan Golomt Xac Other

MN

T b

ln.

2011 2012.09


Total asset market share

End of Sep 2012

TDB 25.4%

Khaan 23.1%

Golomt 21.7%

Xac 8.8%

Savings 7.8%

UBCB 4.3%

State 2.9%

Capital 2.7%

Capitron 1.1%Chinggis 1.1%

Other 1.1%


Total loan growth in banking sector Total loan growth in banks

End of Sep 2012

(11.9%)

38.2%

72.3%

22.2%

(8.9%) 18.8%

140.8%

37.4%

0

1000

2000

3000

4000

5000

6000

7000

2009 2010 2011 2012.09

MN

T b

ln.

Banking sector TDB

1407.6

1147.1

1260.4

546.0

1298.5

1714.1

1576.6

1453.0

620.9

1548.5

0

200

400

600

800

1000

1200

1400

1600

1800

Khaan TDB Golomt Xac Other

MN

T b

ln.

2011 2012.09


Total loan market share

End of Sep 2012

Khaan 24.8%

TDB 22.8%

Golomt 21.0%

Хас 9.0%

Savings 7.0%,

UB city 4.6%

Capital 2.8%

State Bank 2.5%

Chinggis Khan 1.2%Capitron 1.1%

Other 3.2%

Corporate lending market share by big banks*


End of Sep 2012

Individuals loan market share by big banks*

*from BOM report end of Sep 2012

TDB30.8%

Golomt26.1%

Khaan14.6%

Xac5.6%

Savings2.6%

Other20.3%

Khaan38.1%

Golomt14.4%

Xac13.3%

TDB12.9%

Savings12.5%

Other8.8%


End of Sep 2012

NPL ratio of banks

0.8%

1.3% 1.3% 1.3%

1.9%

2.3% 2.3%2.4%

2.7%

3.8%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

State Bank

Хас TDB Khaan Capital Golomt Savings UHO Erel UB city

perc

enta

ge


Total deposit growth in banking sector Total deposit growth in banks

End of Sep 2012

Total Deposit is calculated to supplemet, current accounts, deposits, liabilities to Non bank financial corporations and other types current accounts deposits.

1585.5

1717.4

1177.4

343.7

924.7

1663.91588.8

1404.0

490.2

1061.7

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Khaan Golomt TDB Xac Other

MN

T b

ln.

2011 2012.09

31.7%

66.8%

36.5%

8.0%

43.8%

85.4%

36.9%19.2%

0

1000

2000

3000

4000

5000

6000

7000

2009 2010 2011 2012.09

MN

T b

ln.

Banking sector TDB


Total deposit market share

End of Sep 2012

Khaan 26.8%

Golomt 25.6%TDB 22.6%

Savings 8.2%

Xac 7.9%

State 2.8%

UBCB 2.6%Capital 1.4% Capitron 0.9%

Other 1.2%


End of Sep 2012

247.2

178.3 188.4

82.6

217.0

296.4

275.3

233.3

94.6

243.8

0

50

100

150

200

250

300

350

Khaan TDB Golomt Xac Other

MN

T b

ln.

2011 2012.09

Capital fund growth in big banks Capital fund market share

Khaan25.9%

TDB24.1%

Golomt20.4%

Xac8.3%

Savings6.8%

Capital2.1%

Capitron1.0%

Other11.4%


End of Sep 2012

Total profit market shareTotal profit growth in big banks

48.5

58.4

31.0

12.2

34.2

50.0 48.9

24.2

12.114.8

0

10

20

30

40

50

60

70

TDB Khaan Golomt XAC Other

MN

T b

ln.

2011 2012.09.30

TDB33.3%

Khaan32.6%

Golomt16.2%

Xac8.0%

Capitron4.5%

UB city3.7%

Other1.7%

ROAA of big banks

Note: Calculated on average assets for March.2011– Sep.2012


End of Sep 2012

2.6%

3.0%

2.2%2.0%

2.4% 2.4%

9.2%

1.6%

0.2%

4.2%

0.4%

3.1%2.8%

2.1%1.9% 1.8%

1.7% 1.5%1.4%

-0.5% -0.5%

0.0%

-1%

1%

3%

5%

7%

9%

TDB Khaan State Bank

Erel Xac UBC UHO Golomt Savings Credit Capital

perc

enta

ge

2011 2012.09.30

ROAE of big banks

Note: Calculated on average shareholders’ equities for the end of March.2011– Sep.2012


End of Sep 2012

39.8%

27.0%28.8%

19.3%

30.2%

2.2%

15.1%

5.0%

55.0%

6.6% 5.4%

35.7%

18.0%

29.7%

17.7%

21.2%

-8.9%

17.3%

0.3%

18.4%

10.7%

-1.1%

-10%

0%

10%

20%

30%

40%

50%

60%

TDB Golomt Khaan Xac UBC Savings State Bank

Capital UHO Erel Credit

perc

enta

ge

2011 2012.09.30

Sources: Bank of Mongolia

Note: Calculated on average shareholders’ equity & assets.Size of bubbles related to book value of assets at the end of Sep 2012

Aver. Leverage 11.5

Aver. est. ROAE

22.5%

Aver. est. ROAA

2.0%

End of Sep 2012


Capital Adequacy ratio in banking sector*


End of Sep 2012

Liquidity ratio in banking sector*

*Source: Companies data

18.9%

17.3%

14.8%14.1%

13.6% 13.0%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

Xac State Khaan TDB UBCB Savings

perc

enta

ge

42.3%

37.0%

31.6%30.6%

26.5%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

State TDB Khaan Savings UBCB

perc

enta

ge


End of Sep 2012

TDB’s treasury market share*

*TDB treasury ‘s data end of Sep 2012

21.3%

29.3%

36.6%

78.7%

70.7%

58.0%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Money market FX Market Gold

perc

enta

ge

TDB Other

THANK YOU

Mobile money

• There are 2.2 billion users of financial service in the world.

• There are 5 billion mobile phone users in the world.

• Due to technological advancement customers have been using mobile phones for their banking and payment services in recent years.

• New technological systems of mobile payment are being introduced day by day.

• Intensive development of mobile payment encourages to increase the number of business partners in this market.

• Compared to 2008 statistics, Mobile payment transaction increased 8 times and the number will be expected to reach to 250 billion dollars by the end of 2012.

Global M-Payments: Number of transaction

3,120

4,587

6,756

9,814

-

2,000

4,000

6,000

8,000

10,000

12,000

2009 2010 2011 2012

Million

World payments report 2011, Capgemini, The Royal Bank of Scotland

Global Mobile payment transaction

28.944.6

96.8

163.1

249.1

0

50

100

150

200

250

300

2008 2009 2010 2011 2012

$ billions

Arthur D Little, Global trends in M-payment challenges and opportunities,2010

Mobile payments in Mongolia

• The Trade and Development Bank of Mongoliainitially introduced the Mostmoney service that isone form of mobile payment.

• Mostmoney service is a single electronic paymentservice which provides customers with opportunityto get banking and payment services through theirphones and internet accessing to their bankaccounts.

Mostmoney payment system

Billers

Mobile operatorsBanks

Anypay operators

Mostmoney service

Any payBill payment

Cash income

Cash withdrawal

Money

Transfer

Purchase

Prepaid services

- International calling

card

- Dijital CaTv card

Mostmoney service

Advantages of Mostmoney

• Easy to use and understand thanks to menu installation.

• Mostmoney menu is available to be installed in all types of phones. /Cellphones and smartphones/

• Customers can get the service by using mobile phone and internet as following link www.customer.mostmoney.mn

• The service offers various kinds of menu applications such as STK, Java, Android, iOS so that customers can choose the most convenient way of use depending on their situations.

http://www.customer.mostmoney.mn/

Mostmoney service benefits

For customers

• Purchasing with mobile phones;

• Possibility to use and access multi accounts from different banks;

• Withdraw cash from ATM accessing to card, current and savings accounts by using phones;

• Cash income and withdrawal transactions are available to be made at all branches of banks that joined the Mostmoney service;

• Possible to make bill payments whenever and wherever the customer wants;

• Those customers registered to Mostmoney service can transfer money to one another through phone numbers;

For merchants• Traders, businessmen and entrepreneur who use Mostmoney expand

their way of trade. ― For retailer: Mostmoney Mobile POS

― For e-merchants : Mostmoney Web POS

― For bank merchants: Mostmoney Card POS

Benefits

• Offers customers wide range of payment choice;

• Increase the number of new customers;

• Enhance ability to competitive in business market;

• Possibility to raise sales income;

• Financial accounting is enhanced due to increase in non cash transactions;



For billers

• All public and private organizations that provide post paid service are available to join Mostmoney billing service. ― Internet service

― Cable TV

― Estate agent, water, electricity, heating

― Mobile operators

Benefits

• Possible to collect payment from customers through their phones;

• Make the collection of payment faster;

• Reduce expense of payment collection;

• Easy to make reports;

• Duration of payment collection shortens so that financial circulation expands;


For other businessmen:

• Organizations and businessmen who provide prepaid services are available to sell their products through Mostmoney -Any pay service. ― Selling Cell phone units― International calling card― Entertainment tickets― Car garages and parking tickets― Public transport tickets (train and bus)

Benefits

• Offering new way of selling products and opportunity to deliver service to customers when they want;

• Possibility to increase sales;

• Decreasing costs and expenses related to sales;

• Opportunity to present products and services;

• Introducing new service to customers enables businessmen to become leaders in their fields;


• Wide choice of making payment;

• Get bank service in spite of locations and time;

• Payment tool of liquidity;Prevent from cash risks;

Customer Merchant

• Possibility to raise sales income;

• Prevent from cash risks;

Biller

• Collect payment faster and

more reliable;

• No need to contact with many

banks at the same time;

• Economize expenses;

The future possibilities of Mostmoney

• International money transfer;

• Electronic identification card, driving license, health insurance;

• Benefits from the government, pension, dividend income;

• Public transport tickets, car garages and parking tickets;

• NFC тechnology;

THANK YOU FOR YOUR ATTENTION

Juulchin street-7, Bagatoiruu-12, Chingeltei district,

Ulaanbaatar, Mongolia

Bank website: www.tdbm.mn

Service Website: www.mostmoney.mn

Email: [email protected]

http://www.tdbm.mn/

http://www.mostmoney.mn/

mailto:[email protected]

05.11.2012, mongolian banking sector analysis, mr. randolph koppa

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