19 november 2014 h1fy2015 results investors …...1 your bank. malaysia’s bank. ambank. h1fy2015...
TRANSCRIPT
1 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
19 November 2014
H1FY2015 Results – Investors Presentation Ashok Ramamurthy, Group Managing Director
Your Bank. Malaysia’s Bank. AmBank.
2 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation Your Bank. Malaysia’s Bank. AmBank.
AGENDA Page
1. EXECUTIVE SUMMARY 2
2. H1FY2015 GROUP FINANCIAL PERFORMANCE 12
3. OUTLOOK & STRATEGIC PRIORITIES 28
4. DIVISIONAL STRATEGY & PERFORMANCE 34
5. SUPPLEMENTARY INFORMATION 40
- AMBANK GROUP
- ECONOMY & INDUSTRY
3 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
H1FY2015 performance highlights
PATMI up 8.9%1, ROE of 14.3%1 underpinned by divestment gains
Performance reflects ongoing transformation…
• Ongoing portfolio rebalancing, net loans up 1.4% with stronger growth in targeted segments, LDR at 89.3%
• Expense management to support ongoing investments, CTI at 43.3%1
• Managing capital levels in line with our expectations on future Holding Company Basel III requirements. Proposed interim dividend of 12.0 sen representing circa 50% of FY2015 expected payout
...and
• Cautious credit risk appetite in selected segments in Retail impacting loans growth
• Continued funding pressure with intensifying competition in deposits
• New consolidated WB model implemented and stabilising, gaining momentum in preferred sectors/segments, focusing on penetrating customers’ share of wallet
1. Includes one-off divestment gain of AmLife & AmFamily
4 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Progressively delivering on our strategic agenda
Deliver on focused organic
growth
New small business solutions within Retail Banking rolled out nationwide, targeting niche SME segment
Wholesale banking consolidation completed, new product specialist and coverage teams set up
Commenced core banking system implementation (Phase 2), target to complete within 18 months
Leverage strategic
partnerships & deliver on
acquisitions
Tail end of system integration, target to complete by CY2014
• MBF: Achieved cost synergies of RM 13.8mil and revenue synergies of RM 2.9mil for H1FY15; merchant force stable at >55,000
• Kurnia: Achieved cost synergies of RM 70.4mil to-date
AmMetLife: new CEO/leadership team and board members appointed
Continue to optimise efficiency
Issued USD 400mil senior notes jointly arranged by AmInvestment & ANZ, provides ability to raised term funding at competitive rates regionally
Rationalising subsidiaries and non-core operations, releasing dormant capital
Streamlining internal organisation structure for greater efficiency
Build sustainability
Investing in significant governance & compliance projects
Material enhancements underway in digital (internet & mobile) banking platforms. Corporate website facelift to be launched in Nov 2014, mobile and tablet responsive to improve user’s experience
Building leadership and increase talent mobility, aligned and enhanced rewards/recognition (Total Target Remuneration Project)
1
2
3
4
Focused growth Leverage investments Optimise enablers
5 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Tailored solutions and products to cater specifically to Small Business customers
Retail Banking: Small Business Banking Solutions - providing big support to Small Business Customers nationwide
Aspiration
Supporting Small
Businesses – TODAY!
Our Segment Customers with business turnover <RM25 million and Business-Group exposure
<RM3 million
To become the bank of choice for Small Business customers in Malaysia
70 dedicated Small Business Specialists covering all AmBank branches nationwide
Customer centric sales process, supported by SBB BizReview, a comprehensive profiling and needs assessment tool
Deliver market leading customer experience
o Dedicated SBB Customer Assist, a contact centre team providing servicing support to SBB customers expected to go live in Dec 2014
6 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Value proposition
Created new industry, geography and segmentation focused teams
Relationship Management teams as single point of contact – enhance customer experience across sales, product solutions and servicing
Promote product neutrality to increase cross sell
Build centers of product expertise
Provide innovative, differentiated and competitive products and solutions to the wholesale client segment
Promote greater product bundling
Consolidation and centralisation of operations
Increase customer centricity
Achieve product excellence
Improve operational efficiency
Wholesale Banking’s journey towards customer centricity
Investment Banking
Corporate & Institutional
Banking
Markets
Transaction Banking
Business Banking
Wholesale Banking – Coverage
Wholesale Banking – Products
Previously Currently
5 Business divisions 2 Business divisions
7 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Key Highlights
Completed Kurnia acquisition on 26 Sep 2012, combined entity renamed AmGeneral Insurance Berhad on 1 Mar 2013
• Leading motor insurer in Malaysia
• >3.6 million policy holders, ~10% market share for general insurance by GWP
• Achieved cost synergies of RM 70.4mil to-date, on track to complete Kurnia Motor integration by end CY2014
“AmAssurance” & “Kurnia” dual branding strategy, first in Malaysian general insurance market
New CEO appointed from IAG
Building pricing capability to lead the de-tariff market
Developing and strengthening alliances with key partners
Mr Derek Roberts, new CEO appointed from IAG
Strategic partnership with Insurance Australia Group (IAG)
8 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Partnership with MetLife, aligned vision with complementary strength
AmLife & AmFamily Takaful businesses – new strategic partnership with MetLife International Holdings, Inc.
Leverage best practices and global standards, creating a modern, innovative, customer centred insurer
Launched new brand name, revamped website, “LIVE READY” campaigns
8 H1FY2015 Results – Investors Presentation
Key focus and planned initiatives:
1. Enhance brand - new corporate website launched together with a series of ‘Live Ready’ campaigns
2. Strengthen distribution channel
o Agency enhancement
o New distribution channel, setting up Insurance/Takaful Specialist teams at AmBank branches
o Direct marketing telemarketing (DMTM) outsourcing commenced in Sep 2014
3. IT investment to strengthen foundation and support growth
4. Align policies and processes in human resources, risk management & compliance, actuarial & finance
5. Develop core organisational talents and strengthening leadership teams
9 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
34.7
44.7
49.6 54.0
59.3
30.0 32.7
FY10 FY11 FY12 FY13 FY14 H1FY14 H1FY15
1,009
1,343 1,484
1,621 1,782
903 983
11.5% 13.6% 13.8% 13.9% 14.1% 14.4% 14.3%
FY10 FY11 FY12 FY13 FY14 H1FY14 H1FY15
PATMI (RM'mil)
ROE (%)
1.13%
1.39% 1.39% 1.37% 1.45% 1.47%
1.65%
FY10 FY11 FY12 FY13 FY14 H1FY14 H1FY15
H1FY15 results underpinned by stronger non-interest income
CAGR FY10-14: 0.08% YoY growth: 0.18%
CAGR FY10-14: 14.3% YoY growth: 8.8%
ROE CAGR FY10-14: 0.7% YoY growth: -0.1%
PATMI CAGR FY10-14: 15.3% YoY growth: 8.9%
1. FY2013 has been restated to reflect adoption of new MFRS
RM (sen)
(%)
PATMI & ROE ROA
EPS (basic)
42.0% 39.9% 41.6%
48.1% 45.9% 47.8%
43.3%
FY10 FY11 FY12 FY13 FY14 H1FY14 H1FY15
CTI YoY change: -4.5%
(%)
CTI
10 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
- - -
9.4% 9.7% 10.3% 9.8% 9.8% 10.4%
11.1% 11.2% 11.7%
15.3% 14.0%
14.7% 14.8% 15.5% 16.1%
FY10 FY11 FY12 FY13 FY14 H1FY15
CET-1 Tier-1 RWCAR/Total Capital
3.8%
3.3%
2.5%
1.98% 1.86% 1.95% 1.79%
FY10 FY11 FY12 FY13 FY14 H1FY14 H1FY15
64.8 71.1
75.7
82.6 87.2
83.6 84.7
FY10 FY11 FY12 FY13 FY14 H1FY14 H1FY15
8.5 10.4 13.2 16.8 18.7 16.5 17.1
70.7 81.5
84.6 93.1
98.3 96.3 94.8
12% 14% 17%
20% 21% 19% 20%
FY10 FY11 FY12 FY13 FY14 H1FY14 H1FY15
Customer deposits (RM'bil)
CASA(RM'bil)
CASA Composition (%)
Net Lending
Sound risk and capital profiles, focusing growth in targeted segments
CAGR FY10-14: 7.7% Net lending YoY growth: 1.4% Gross lending YoY growth: 0.9%
Customer Deposits CAGR FY10-14 : 8.6% YoY growth: -1.5%
YoY change: -0.16%
(RM’bil)
(%) (%)
Customer Deposits2 & CASA
Net Lending
GIL ratio Capital ratio
1. FY2013 has been restated to reflect adoption of new MFRS 2. Customer deposits includes stable funding sources
LDR 89.3%2
Basel III
CASA CAGR FY10-14: 21.9% YoY growth: 3.6%
Basel II
11 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
19 November 2014
H1FY2015 Results – Investors Presentation Mandy Simpson, Chief Financial Officer
Your Bank. Malaysia’s Bank. AmBank.
12 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation Your Bank. Malaysia’s Bank. AmBank.
AGENDA Page
1. EXECUTIVE SUMMARY 2
2. H1FY2015 GROUP FINANCIAL PERFORMANCE 12
3. OUTLOOK & STRATEGIC PRIORITIES 28
4. DIVISIONAL STRATEGY & PERFORMANCE 34
5. SUPPLEMENTARY INFORMATION 40
- AMBANK GROUP
- ECONOMY & INDUSTRY
13 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
41.6% >100.0% 1.1% 54.9%
982.8 mil
8.9% 9.2% 18.5% 8.8% 10.9%
902.8 mil
8.3%
Islamic PATMI Conventional PATMI Positive growth in H1FY15 Contraction in H1FY15
Non-interest income underpinned H1FY2015 results
Growth 2.1%
PATMI: profit after tax and non controlling interests
12%
88%
15%
85%
PATMI H1FY14
Net Interest Income
Non-Interest Income
Total income
Expenses PBP Provisions/ Allowances
PBT Tax & Zakat
PAT MI PATMI H1FY15
H1FY15 (RM’mil)
1,412.1 1,178.1 2,590.3 1,118.3 1,472.0 125.0 1,347.0 298.4 1,048.6 65.8
H1FY14 (RM’mil)
1,540.7 831.9 2,372.6 1,130.2 1,242.3 4.6 1,237.7 292.4 945.3 42.5
14 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
47.8% 47.8% 44.5% 42.5% 42.7% 44.2%
49.8%
Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15
CTI Underlying %
25.6 25.4 25.6 25.3 24.6 24.1
58.5 58.2 59.2 61.8 61.0 60.6
Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15
(RM’bil)
Auto Fin Loans excluding AF
C. Deposits QoQ growth: -0.3% CASA QoQ growth: -9.0%
PATMI QoQ growth: -17.0% ROE QoQ growth: -3.3%
QoQ growth: -1.0% YoY growth: 1.4%
Stronger QoQ performance
PATMI & ROE CTI
Net Lending Customer Deposits1 & CASA
1. Customer deposits include stable funding sources
QoQ change: 1.5%
18.0 16.5 17.3 18.7 18.8 17.1
95.4 96.3
95.8 98.3 95.1 94.8
21%
17% 18% 21% 22% 20%
Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15
Customer deposits (RM'bil) CASA(RM'bil)CASA Composition (%)
329.3
462 441 416.0 464.0
536.9
446.0
15.1% 13.9% 13.1% 14.6% 16.0% 12.7%
Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15
Underlying PATMI PATMI (RM'mil) ROE CTI %
Partly reflects portfolio rebalancing & re-alignment of
customer segment focus
84.2 83.6 84.8 87.2 85.6 84.7
15 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Q2 vs. Q1FY2015 (Underlying)
qoq growth
H1FY2015 (Underlying)
yoy growth
H1FY2015 (Reported)
yoy growth
Income 5.2% (4.3%) 9.2%
Expenses 7.3% 4.6% 1.1%
PBP 17.5% (4.1%) 18.5%
PATMI 35.4% (3.5%) 8.9%
NIM 0.09%
(Q2FY15 vs. Q1FY15)
(0.14%) (H1FY15 vs. FY14)
(0.19%) (H1FY15 vs. FY14)
Non-interest income composition (%)
36.2% 35.8% 45.5%
Note: Reflects (1) H1FY2015 – divestment gain from AmLife and AmFamily Takaful, net of tax (2) H1FY2014 – equity accounting of AmLife & AmFamily and one-off large recoveries of RM125 million
Momentum picked up in Q2
16 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Retail Banking: Targeted growth, continue to build customer franchise
Key financials: Performance highlights:
CASA (RM’bil)
Gross Loans (RM’bil)
Profit (RM’mil)
Customer deposits and CASA growth driven by initiatives surrounding segment play (small business, emerging affluent and payroll) to build main bank relationships
Loans growth reflects more cautious credit appetite and targeted growth
Lower profits on margin compression and higher provisions; offset by lower expenses from MBF cost synergies and productivity initiatives
16.7 17.9
26.0 24.6
5.8 5.3
H1FY14 H1FY15
Mortgage Auto Fin Others
48.8 47.7 1.4%
9.9 10.4
38.7 40.9
H1FY14 H1FY15
CASA Cust Deposits
Cus Dep 5.9% CASA 5.0%
Key focus & planned initiatives:
Focus on targeted segment play through small business banking solutions and young professionals
Greater emphasis on mortgage and continuous end-to-end process review to improve efficiency and customer experience
Remain focused on expanding fee based income via bancassurance and wealth management
Digital (internet & mobile) banking platforms upgrade in progress
85% 94%
15%
6%
H1FY14 H1FY15
31.8% 341 232
Conventional PAT Islamic PAT
17 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Wholesale Banking: Re-prioritising coverage by segment & sector
Key financials: Performance highlights:
Profits (RM’mil)
Gross Loans & Average AUM1
(RM’bil)
Market share
Key focus & planned initiatives:
Pick up in loans performance through drawdown of loans in key sectors
Drive deposits and trade utlilisation through progressively rolling out new solutions including integrated propositions with Retail, and leveraging ANZs connectivity
Execute on the large deal pipelines for both DCM and CF for 2H2015
Build up markets trading activities and focus on larger FX and Derivatives sales
Conventional PAT Islamic PAT
85% 80%
15% 20%
H1FY14 H1FY15
17.1% 568 471
1. Average AUM represents AmInvest’s funds under management, Private Banking, Am Private Equity & AmARA REITs
2. As at 30 Sep 2014 3. Represents AmInvest’s funds under management as at 30 March 2014
37.4 39.0
42.2 46.1
H1FY14 H1FY15
Gross loans AUM
AUM 9.2% Loans 4.3%
Market Share (%)
Rank
IPO2 22.6% 2
DCM2 13.5% 3
M’sian Ringgit Islamic Bonds2
13.8% 3
FUM3 13.6% 3
New consolidated WB model implemented and stabilising
Performance underpinned by:
o Corporate banking which saw modest loans growth and normalised recoveries
o Underlying TB performance was steady with Cash being impacted by a few lumpy deposits
o Markets performance reflects strong FI trading performance, offset by slower FX sales revenue
o Funds Management continues to deliver good growth in AUM resulting in steady profit growth
o Improved contributions from Broking, Fixed Income and Private Banking
18 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
General Insurance: stronger investment income
Key financials: Performance highlights:
Combined ratio (%)
Net earned premium (RM’mil)
Profits (RM’mil)
Higher profits underpinned by improved claims management and gain on disposal of investments
Achieved cumulative synergy of RM 70.4mil to-date (Sep 2014)
Capital adequacy ratio exceeds benchmark regulatory target
779 750
H1FY14 H1FY15
90.4% 90.2%
H1FY14 H1FY15
0.2%
Key focus & planned initiatives:
Develop and strengthen alliances with key partners
Drive premium growth via focused action plans including new products & services, campaigns, agent engagements and exploring new markets
Building pricing capability to lead the de-tariff market
Improving supply chain management
On track to complete Kurnia Motor integration by end CY2014, continue to extract synergies
3.6%
84 132
H1FY14 H1FY15
57.8%
19 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
H1FY14 Fees on loans AUM IB businessOther fee incTotal Fee income Sales TradingOther trading incTotal Trading & InvestmentGeneral Life & TakafulTotal Insurance Other H1FY15H1FY14 Fees on loans AUM IB businessOther fee incTotal Fee income Sales TradingOther trading incTotal Trading & InvestmentGeneral Life & TakafulTotal Insurance Other H1FY15
Fees on
loans
AUM IB business Other fee inc Total Fee
income
Sales Trading Other
trading inc
Total
Trading &
Investment
General Life &
Takaful
Total
Insurance
Other
* IB business includes brokerage fees, underwriting fees and corporate advisory & guarantees
As % of total income 35% 45%
54.3% 19.4% Growth 4.1% 10.7% >100.0%
1,178.1 mil
>100.0% 39.3% >100.0% 25.2% 41.6% 8.0%
H1FY15 non interest income Positive growth in H1FY15 Contraction in H1FY15
Retail: -7mil Wholesale: -23mil
H1FY14 non interest income
831.9 mil
H1FY14 Fees on
lending & securities
AUM IB
business* Other fee income
Total Fee Income
Sales Trading Other
trading & investment
Trading & Investment
General Life &
Takaful Insurance Business
Others H1FY15
% of Composition
10% 7% 8% 5% 31% 4% 7% 29% 41% 22% 2% 24% 5%
H1FY15 (RM’mil)
123.2 83.2 93.0 61.0 360.5 47.2 88.0 343.9 479.1 263.7 19.8 283.5 55.1
H1FY14 (RM’mil)
152.9 80.0 104.2 54.7 391.7 77.7 36.8 0.3 114.9 238.1 43.3 281.4 44.0
11.6%
Non-interest income movement
Stronger contributions from trading & general insurance whilst fee income impacted by moderate loans growth
10.8% 0.8%
Includes gross divestment gain
Includes 5-mths equity accounting of AmLife & AmFamily
20 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
268.3
256.6
249.0
5.1
4.5
5.0
6.7
12.2
5.0
FY14 AmLife & AmFamily FY14 one-offs Normalised FY14 Rates & mix HP asset quality Yields - Markets & Gen Deposits H1FY15
Margins remain a challenge, improved yields & recent rate hike lifted QoQ NIM
Note : 1 NIM includes Net Financing Income from Islamic Banking business 2 FY10-FY14 based on internal data computation 3 FY2013 has been restated to reflect adoption of new MFRS
FY10 FY11 FY12 FY13 FY13
[Restated]3 FY14 H1FY15
NIM and COF (YOY)
MFR
S 1
0
2.68%
2.92%
3.13% 3.10% 3.10% 3.09%2.98% 2.94%
2.75%2.68% 2.72% 2.69%
2.25%
2.75%
3.00% 3.00%3.00% 3.00%
1.00% 1.00%
4.00% 4.00% 4.00% 4.00%
FY10 FY11 FY12 FY13 1 Apr 2013 FY14Cost of funds NIM OPR SRR
COF
NIM
SRR
OPR
2.67% 2.63%
2.45%
1-Apr-13 FY14 Q1FY15
NIM (without AmLife & AmFamily)
11.7ps
FY14 AmLife & AmFamily
FY14 one-offs Normalised
FY14 Rates & mix AF asset quality
Yields – Markets & Gen Ins
Funding H1FY15
YTD NIM (bps) drivers
7.6ps
Q1FY2015 Q2FY2015
NIM 2.45% 2.54%
2.68%
2.92%
3.13% 3.10% 3.10% 3.09%
3.14%
2.98% 2.94%
2.75% 2.68%
2.72%
2.68%2.49%
2.25%
2.75%
3.00%3.00% 3.00%
3.00%
3.25%
1.00% 1.00%
4.00% 4.00% 4.00% 4.00% 4.00%
FY10 FY11 FY12 FY13 FY14 H1FY15
Cost of funds NIM OPR SRR
2.67% 2.63%
2.49%
FY14 H1FY15
NIM (without AmLife & AmFamily)
21 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Disciplined cost management to support ongoing investment
H1FY14 Personnel Establishment Marketing &
Comm Admin & others
Acquisition & Biz efficiency expenses
H1FY15
% of Composition 55% 23% 6% 9% 7%
H1FY15 (RM’mil) 616.1 261.0 69.0 95.8 76.3
H1FY14 (RM’mil) 675.2 262.0 87.8 98.8 6.5
8.8% 0.4% 21.4% 3.0%
47.6% 43.3% CTI
YoY Growth
RM’mil 1,130.2 1,118.3
Expense growth drivers
>100.0% 1.1%
Productivity initiatives
Save to invest programme
Banking CTI AmGeneral COR*
H1FY15 43.2% 90.2%
H1FY14 47.7% 90.4%
Deliver on focused organic growth
Retail Application Scorecards Enhancement (RAS2)1 to
support AIRB accreditation programme
AmData Intelligence: data mart & centralised dashboard reporting system (Phase 2)
Core banking system implementation (phase 2)
Digital (internet & mobile) banking platform upgrade
Murex implementation & upgrade
Continue to optimise efficiency
Retail collection & recovery system replacement
Save to Invest Programme
Enterprise Process Platform (EPP) Programme
Build sustainability
New multi-channel switch which consolidates multiple switches operating on various platforms
Infrastructure Facilities Modernisation1
Basel Advanced Internal Rating Based (AIRB) and related risk projects
1
Disaster recovery capabilities1
GST (Goods & Services Tax) readiness1
Regulatory Reporting System & BNM ISS (Phase 3) 1
De-tariff risk selection and pricing engine1
Anti Money Laundering Act compliance (Phase 3) 1
Others (e.g. MEPS/MyClear compliance, IBG enhancement, MyMobile, eIBFT, TAC Registration Process enhancement, single counterparty exposure limit)
1
Strategic Priorities Key investment over 12 – 18 months to deliver growth, optimise efficiency & build sustainability
1. Regulatory and compliance related
* Combined Operating Ratio
22 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
129.2%
117.6%
8.7%
18.4%
1.9%
95.6% 99.6% 104.5% 102.2%
114.6%
129.3% 127.4%117.6%
Industry AmBank Group
(31.0)
85.8
105.0
28.7
193.1
3.18%
0.97%0.60% 0.88%
6.2%
3.7%
2.6%1.5%
10.4%
6.3%
4.1%
2.8%3.81%
3.33%
2.45% 1.98% 1.86% 1.79%
0.50%0.21% 0.08% 0.20%
3.18%
0.97%0.60%
0.88%
6.2%
3.7%
2.6%
1.5%
10.4%
6.3%
4.1%
2.8%
3.81%3.33%
2.45% 1.98% 1.97%0.50%
0.21% 0.01%
2.87% 2.64% 2.41%
Net Provisions Charge Net NPL Ratio Gross NPL Ratio Gross Impaired Loans Loan Loss Charge(MFRS139) Loan Loss Reserve
Loan Loss Coverage
Asset quality within expected level
202 bps
MFR
S 1
39
MFR
S 1
39
GP
3
FY2007 FY2008 FY2009 FY2010 1/4/10 FY2011 FY2012 FY2013 FY2014 H1FY15
Asset quality indicators
FY2012 FY2013 FY2014 H1FY2015
AmBank Group
Industry
RM’mil
H1FY14 loan loss coverage
Collective allowance
Individual allowance
Impaired loans &
financing
H1FY15 loan loss coverage
H1FY14 Allowance for impairment
Individual allowance
Collective allowance
Impaired loans –
recovered
H1FY15 Allowance for impairment
Allowance for impairment on loans & financing (P&L)
Movement in loan loss coverage
Normalised recoveries
23 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Modest loans growth reflects realignment of portfolios and segments
85.8bil
7.2% 9.5% 4.3% >100.0% 11.3% 0.9%
86.6bil
4.6%
No
n-re
tail
Reta
il
5.4%
Non-Retail Retail Positive growth in H1FY15 Contraction in H1FY15
Gross Loan H1FY14
Auto Financing
Mortgage Cards Co-op Small Biz Wholesale Others Gross Loan
H1FY15
% of Composition
28.4% 20.7% 2.3% 1.8% 2.0% 45.0% -0.2%
H1FY15 (RM’bil)
24.6 17.9 2.0 1.5 1.8 39.0 (0.1)
H1FY14 (RM’bil)
26.0 16.7 2.2 1.6 2.0 37.4 (0.0)
Gross Loan / Financing
movement
55%
45%
56%
44%
Conventional,
72%
Islamic,
28%
Fixed
rate, 43%Variable
rate, 57%
Re-aligning customer segment focus
Re-prioritizing coverage by segment & sector
24 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
-10.0%
-5.0%
0.0%
5.0%
10.0%
20.0
40.0
60.0
80.0
100.0
120.0
140.0
160.0
180.0 Loans growth (%)Industry purchase of
transport vehicles (RM'bil)
AF loans (
RM
'bil)
Industry - purchase of transport vehicles Industry purchase of transport vehicles loans YoY growth
AMMB - Auto Financing YoY growth
Auto Finance: increase proportion of business in preferred risk grades and reduce exposure to vulnerable group
Acquisition targeted at preferred loan tenures and margin of financing
Prudent guidelines on lending to “vulnerable income” groups
This quarter simplified steps to identify targeted segment, enhanced approval process
Continue to apply Risk-based pricing
70% 82% 83%
30% 18% 17%
FY13 FY14 H1FY15
Others Vulnerable
Household Income Group
% of New Business
54% 66% 73%
37% 32% 27%
9% 3% 0%
FY13 FY14 H1FY15
Most Preferred Preferred Least Preferred
Risk Grade
% of New Business
Auto Finance
Note: Vulnerable income group is defined as household income ≤RM3,000
25 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Loans by purpose
Sep’14 YoY
growth Loans
composition
Purchase of resi property
378.3 +13.7% 29.1%
Working capital 300.1 +7.5% 23.1%
Purchase of non resi property
171.5 +15.5% 13.2%
Purchase of transport vehicles
165.6 +2.0% 12.8%
Purchase of securities
74.7 +15.5% 5.8%
Other purposes 64.9 -8.3% 5.0%
Personal use 59.5 +3.5% 4.6%
Construction 37.9 +16.6% 2.9%
Credit card 34.5 +2.1% 2.7%
Purchase of fixed assets
10.6 +13.9% 0.8%
Consumer durables
0.5 >100.0% 0.0%
1,298.1 +9.0% 100.0%
32.0 8.4 99.9 12.9 53.9 96.2
31.9 84.7 78.5
36.5
744.0
19.3
1,298.1
Sep-14
2.5% 0.6% 7.7% 1.0% 4.2% 7.4% 2.5% 6.5% 6.0% 2.8% 57.3% 1.5%
4.7% 3.5% 9.3% 1.3% 4.7% 6.5% 2.6% 2.8% 9.3% 1.4% 53.6% 0.4%
4.13.0 8.0 1.1
4.1 5.62.2 2.4 8.0 1.2
46.4
0.4
86.6
Sep-14
Loans Composition
Loans AmBank Group vis-à-vis Industry
Source : BNM, financial statement Your Bank. Malaysia’s Bank. AmBank.
AmBank Group
Industry
Agriculture Mining &
Quarrying Manufacturing
Electricity, Gas & Water
Construction Wholesale,
Retail, Restaurant
Transport, Storage &
Com
Finance, Insurance,
& Biz. Real Estate
Education & Health
Household Others Total Loans
0.9% YoY Growth
12.1% 16.5% 0.6% 38.8% 24.4% 1.7% 18.3% 12.5% 0.4% 36.6% 0.3% 31.6%
Loans by purpose
Sept’14 YoY
growth Loans
composition
Purchase of transport vehicles
25.6 -8.0% 29.6%
Working capital 19.6 +3.0% 22.6%
Purchase of resi property
15.1 +6.8% 17.5%
Purchase of non resi property
8.6 -5.0% 10.0%
Other purposes 5.3 +4.4% 6.1%
Construction 4.1 +28.3% 4.7%
Purchase of securities
3.6 +52.4% 4.2%
Personal Use 1.9 -7.0% 2.2%
Credit card 1.8 -8.1% 2.1%
Purchase of fixed assets
1.0 -21.3% 1.1%
Consumer durables
0.0 -100.0% 0.0%
86.6 +0.9% 100.0%
Agriculture Mining & Quarrying
Manufacturing Electricity,
Gas & Water Construction
Wholesale, Retail,
Restaurant
Transport, Storage &
Com
Finance, Insurance,
& Biz. Real Estate
Education & Health
Household Others Total Loans
YoY Growth
Loans Growth by Sector
Loans Growth by Sector
0.3% 6.8% 4.1% 32.9% 12.8% 7.3% 14.1% 6.5% 15.5% 18.9% 10.7% 19.3% 9.0%
Loans Composition 2.5% 0.6% 7.7% 1.0% 4.2% 7.4% 2.5% 6.5% 6.0% 2.8% 57.3% 1.5%
4.13.0 8.0 1.1
4.1 5.62.2 2.4 8.0 1.2
46.4
0.4
86.6
Sep-14
4.13.0 8.0 1.1
4.1 5.62.2 2.4 8.0 1.2
46.4
0.4
86.6
Sep-14
26 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
YoY Growth 4.5% 1.7% 3.6% -4.8% 18.4% -1.5%
Cust
Deposits
H1FY14
Current Savings CASA
Term
Deposit
& NID
Term
Funding
Cust
Deposits
H1FY15
H1FY15 11.9 5.2 17.1 68.2 9.5 94.8
H1FY14 11.4 5.1 16.5 71.7 8.0 96.3
96.3
94.8
8.5 10.4
13.2
16.8 18.7
17.1
12% 14%17%
20% 21% 20%
FY2010 FY2011 FY2012 FY2013 FY2014 H1FY2015
CASA CASA composition
1. Term funding includes Senior Notes, credit-linked notes, loans sold with recourse and other sources such as pension and retirement funds, non-profit organisations and similar
Stable CASA composition, continue to reduce reliance on term deposits
Set up a USD2 billion EMTN programme, issued USD400 million post Q1FY15, >10x oversubscribed
o Diversified our funding base
o Provides ability to raise term funding at competitive rates regionally
FY2010 FY2011 FY2012 FY2013 FY2014 H1FY2015
CAGR FY10-14: 21.7%
8.5 10.4
13.2
16.8 18.0
12% 14%17%
20% 19%
FY2010 FY2011 FY2012 FY2013 H1FY2014
CASA CASA composition
Customer deposits driven by focus on CASA
Improving CASA composition
Improving funding composition
FY07 FY10 FY13 FY14 H1FY15
Equity & debt capital 10% 15% 14% 15% 16%
Customer deposits 60% 77% 75% 74% 73%
Term funding & loans with recourse >1year
4% 2% 7% 6% 6%
Term funding & loans
with recourse <1year 1% 1% 1% 2% 2%
Deposits from banks & FIs
25% 5% 3% 3% 3%
Stronger growth in Retail +8.4%
27 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
9.4% 9.7% 10.3%9.8% 10.4%
11.1% 11.2%11.7%14.0%
14.7% 14.8% 15.5%16.1%
Capital within internal targeted range
1. Double leverage ratio computed based on AMMB Holdings company level 2. Balance sheet leverage ratio: total equity net of deferred tax & intangible assets over total assets net of deferred tax assets & intangible assets 3. Total leverage ratio: total equity net of deferred tax & intangible assets over total assets net of deferred tax assets & intangible assets & off balance sheet 4. Based on recent BNM guidelines
Basel II Basel III
--------------------- After proposed dividend ---------------------
FY14 H1FY15
CET 1 Tier 1 Total
capital CET 1 Tier 1
Total capital
AmBank 9.1% 11.1% 14.6% 9.9% 12.0% 15.9%
AmIslamic 9.2% 9.2% 15.2% 9.2% 9.2% 14.9%
AmInvestment 21.2% 21.2% 21.2% 24.5% 24.5% 24.5%
FY2011 FY2012 FY2013 FY2014 H1FY15
CET 1 Tier 1 RWCAR / Total Capital Ratio
Capital adequacy ratio: Aggregated Banking Entities
Capital adequacy ratio: Legal Entities
Adopted Basel III at banking entity level
Internal target capital levels for FY2015:
o CET 1: 9.0% ± 1.0%
o Tier 1: 10.5% ± 1.0%
o Total Capital: 15.0% ± 1.0%
Double leverage ratio1: 1.13x
Balance Sheet leverage ratio2: 9.4%
Total leverage ratio3: 7.3%
Financial Holding Company (FHC) - no requirements until FY20204
Key measures to optimise capital structure & efficiency:
o Rationalising subsidiaries and non-core operations, releasing dormant capital
o Streamlining internal organisation structure for greater efficiency
o Building advanced internal rating based (AIRB) capabilities
28 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation Your Bank. Malaysia’s Bank. AmBank.
AGENDA Page
1. EXECUTIVE SUMMARY 2
2. H1FY2015 GROUP FINANCIAL PERFORMANCE 12
3. OUTLOOK & STRATEGIC PRIORITIES 28
4. DIVISIONAL STRATEGY & PERFORMANCE 34
5. SUPPLEMENTARY INFORMATION 40
- AMBANK GROUP
- ECONOMY & INDUSTRY
29 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Financial services outlook
MALAYSIA: No change to our growth projection
Monetary policy will remain prudent to support the economic growth and address financial imbalances
Moderate loans growth in line with the economic outlook and monetary policy
Asset quality may come under pressure more from rising inflation and borrowing cost as well as potential capital flow risk
Margins remain a challenge from the stiff price-based competition for loans and deposits
BANKING: Opportunities & challenges
Malaysian economy: supported by domestic activities & exports
• Growth in 2014 will depend on private investment and exports, with softening private consumption
• Inflation will be a focal point in 2014 driven by on-going rationalisation of subsidy and pre-GST impact. The other one being public debt
• Authorities will continue to adopt prudent and pragmatic macroeconomic policies, reining in fiscal deficit and public debt
2013 2014f 2015f
RGDP y/y% 4.7 5.9 5.2
Inflation y/y% 2.1 3.2 3.8
OPR 3.00 3.25 3.50
Unemployment (%) 2.9 3.0 3.0
FB% GDP (FY) -3.9 -3.3 -2.8
CA% GDP 3.6 6.8 5.5
94.8
12.1%
6.7%
Jul-
12
Aug-1
2
Sep-1
2
Oct-
12
Nov-1
2
Dec-1
2
Jan-1
3
Feb-1
3
Mar-
13
Apr-
13
May-1
3
Jun-1
3
Jul-
13
Aug-1
3
Sep-1
3
Oct-
13
Nov-1
3
Dec-1
3
Jan-1
4
Feb-1
4
Mar-
14
Apr-
14
May-1
4
Jun-1
4
Jul-
14
Aug-1
4
Sep-1
4
RM'bil
Loans disbursed Loans approved Loans Applied
30 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
As Malaysia’s preferred diversified, internationally connected financial solutions group, we take pride in
growing your future with us.
Record performances & increasing ROE
Consistent revenue growth
Improved balance sheet & funding mix
Increased dividend payout to 40%
Commenced pursuing niche acquisitions
3 Focus areas:
Strategic Business Transformation
High priority growth initiatives
Organisation and governance structures
Delivered consistent growth & returns
Strengthening customer centricity & connectivity
Expand international connectivity initiatives
In-fill acquisitions & new strategic tie-up
Grow retail assets
Lead in investment banking business
Leverage fixed income trading
AmBanking on a new journey
1. Deliver on focused organic growth
2. Leverage strategic partnerships & deliver on acquisitions
3. Continue to optimise efficiency
4. Build sustainability
Pre ANZ FY2008 – 10 FY2011 – 12 FY2013 – 14 FY2015 – 17
Scale & Presence
Reposition, Build New Growth
Options Improve Returns
Aggressively Invest,
Optimise & Leverage Connectivity
Focused Growth
Leverage Investment
Optimise Enablers
31 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Focused growth Leverage investments Optimise enablers
Strategic Priorities FY2015 – 17
Retail: build new value segments in emerging affluent & small business, leverage existing value strength to grow in mass market
Wholesale: grow franchise value by targeting value segments, customer centricity, and deeper relationships to increase SOW, focus on CASA, cross selling & lead in innovation to accelerate non-interest income growth
General Insurance: maintain leading position in motor, diversify into non-motor
Islamic: grow CASA, rebalance portfolio mix, increase fee based income
Complete Kurnia & MBF Cards integrations and deliver synergies. Shift focus to top line growth
Life: grow Banca and synergise with Metlife
Family Takaful: grow sales of credit related term Takaful products & extract synergies from Metlife
Build scalable “customer service delivery center”
Simplify business and operating models
Optimise holding company
Build AIRB capabilities
Strengthen governance
Enhance employee engagement & talent management
Superior customer experience – technology & branding
Deliver on focused organic
growth
Leverage strategic
partnerships & deliver on
acquisitions
Continue to optimise efficiency
Build sustainability
1
2
3
4
32 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
FY2014 H1FY2015 FY2015 FY2016 – 17
PATMI
(RM’mil)
1,782.4
(10.0% yoy)
982.8
(8.9% yoy) Circa 8% 6 – 10%
ROE (%) 14.1% 14.3% Circa 14% Circa 14%
CTI (%)
45.7%
43.1%
(Banking Group)
43.3%
43.2%
(Banking Group)
≤45%; ≤43%
(Banking Group)
≤44%; ≤42%
(Banking Group)
Gross impaired loans (%)
1.86% 1.79% ≤1.9% ≤1.9%
Dividend:
Single-tier (sen)
Payout (%)
Interim: 7.2 sen / share
Final: 16.9 sen / share
41%
Interim: 12.0 sen / share
40 - 50% Payout
40 - 50% Payout
Key performance indicators
FY2015 underlying estimates: NIM expected to contract ~15 bps (underlying) Loan loss charge expected to be circa 15 bps Loans expected to grow ~3% LD ratio expected to maintain at ~90%, ±2%
CASA composition ≥21% Non-interest income composition at circa 38% Target CET 1 of 9.0% (±1%), Tier 1 of 10.5% (±1%),
total capital of 15.0% (±1%)
33 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
3
H1FY2015 underpinned by divestment gains, operating performance moderated
Loans growth likely to remain modest, stronger growth in targeted segments
Cost discipline to continue, further productivity benefits to flow though partially offset by ongoing planned investments
Increasingly challenging business and economic environment, while compliance requirements continue to rise
Key priorities:
- Committed to our FY2015 – 17 strategic agenda - Focus is on achieving FY2015 key performance indicators - Ongoing investment to improve capabilities & customer experience - Remain dynamic & responsive to drive growth
1
2
3
4
5
Summary
34 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation Your Bank. Malaysia’s Bank. AmBank.
AGENDA Page
1. EXECUTIVE SUMMARY 2
2. H1FY2015 GROUP FINANCIAL PERFORMANCE 12
3. OUTLOOK & STRATEGIC PRIORITIES 28
4. DIVISIONAL STRATEGY & PERFORMANCE 34
5. SUPPLEMENTARY INFORMATION 40
- AMBANK GROUP
- ECONOMY & INDUSTRY
35 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
22.2%
Retail Banking
Re-orient to higher value segments, extract value from core mass Aspirations
8.8% Growth 14.4% 2.8% 127.7% 31.7% 31.3% 31.8%
• Retail Banking’s growth agenda will focus on simplification, digital enablement including modernisation of its digital platforms, building a service-oriented culture and people capability. Key segments include small business and young professionals whilst continue to expand and innovate wealth management offerings
Outlook
PAT
H1FY15 PAT H1FY14 PAT Positive growth in H1FY15 Contraction in H1FY15
• Deposit grew stronger underpinned by continuous marketing campaigns and leverage distribution channel
• Targeted loans growth reflects conservative risk appetite and improved quality assets.
• Lower profits on continued margin compression and targeted loans growth; offset by lower expenses from MBF cost synergies and productivity initiatives
Targeted growth
H1FY15 PAT
(composition to Group)
H1FY15
vs
RM'mil H1FY14 H1FY15 H1FY14
PAT H1FY14
Total Income
Expenses PBP Allowances PBT Tax PAT
H1FY15
H1FY15 (RM’mil)
890.6 455.9 434.6 125.4 309.2 76.8 232.3
H1FY14 (RM’mil)
976.7 468.9 507.8 55.1 452.7 111.8 340.9
Gross Loans /
Financing 48,422.6 47,738.2 -▼ -1.4%
Gross Impaired Loans 2.44% 1,287.5 1,165.7 -▼ -9.5%
Customer Deposits 38,680.2 40,943.4 ▲ +5.9%
CASA Deposits 9,938.8 10,431.1 ▲ +5.0%
ROA 1.40% 0.96% -▼ -0.44%
CTI 48.1% 51.3% ▲ +3.2%
Allowance Coverage 78.5% 70.8% -▼ -7.7%
36 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Gross Loans / Financing 37,356.8 38,961.1 ▲ +4.3%
Gross Impaired Loans 1.00% 389.9 387.9 -▼ -0.5%
Customer Deposits 52,106.6 47,358.2 -▼ -9.1%
CASA Deposits 7,588.3 7,446.1 -▼ -1.9%
ROA 2.38% 1.95% -▼ -0.43%
CTI 33.5% 35.9% ▲ +2.4%
Allowance Coverage 137.0% 120.2% -▼ -16.9%
Ave Assets Management 42,233.4 46,107.6 ▲ +9.2%
Loan Rehab, 2%
Wholesale Banking
8.6% Growth 11.9% 2.2% 44.7% 17.0% 16.8% 17.1%
H1FY15 PAT H1FY14 PAT Positive growth in H1FY15 Contraction in H1FY15
PAT H1FY14
Total Income
Expenses PBP Allowances PBT Tax PAT
H1FY15
H1FY15 (RM’mil)
856.5 307.4 549.1 (64.3) 613.3 142.7 470.6
H1FY14 (RM’mil)
937.2 314.2 623.1 (116.2) 739.3 171.0 568.2
PAT
Coverage: Maximising franchise value through holistic coverage & cross sell – full understanding of customer needs, distinguishing service by complexity, allocating specialists intelligently to grow sustainable profitability
Products: To offer innovative, quality products and services and deliver comprehensive differentiated solutions
Aspirations
Outlook • Higher profit growth with strong deals pipeline particularly from debt and loans markets and recovery of fixed
income business. Expecting margin pressure and volatility in the market.
• Performance reflects stabilisation of new Wholesale Banking operating model and normalised recoveries
• Improved contributions from Broking, Fixed Income, Funds Management and Private Banking were partially offset by margin compression, as well as lower foreign exchange and derivative performance
• Reduced expenses through cost management initiatives
• Good growth in assets under management. Customer deposits reflects management of depositors concentration
Diversified contribution across business
H1FY15 PAT (composition to Group)
H1FY15 Income Breakdown
Markets, 11%
Corporate Bkg, 45%
Transaction Bkg, 20%
H1FY15
vs
RM'mil H1FY14 H1FY15 H1FY14
• Assets managements include FMD, private banking, AmAra Reits and AmPrivate Equity
IB, 21%
Others, 4.9%
44.9%
37 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Claim ratio 63.1% 62.0% -▼ -1.1%
Expenses ratio 18.9% 17.8% -▼ -1.1%
Combined ratio 90.4% 90.2% -▼ -0.2%
62.9% 5.1%
General Insurance
Dominate in auto insurance and diversify into non-motor segment Aspirations
3.6% Growth 0.4% 9.2% 25.3% >100.0% 57.8%
Outlook
PAT H1FY15 PAT (composition to Group)
• Higher profits underpinned by gain on disposal of investments and improved claims management
• Achieved cumulative synergy of RM 70.4mil to-date (Sep 2014), target to complete integration by end CY2014
• Positive capital adequacy ratio exceeds benchmark regulatory target
Stronger investment income
• Expecting higher profit level in FY2015, initiatives underway to strengthen strategic alliances with key partners and brand enhancement
PAT H1FY14
Net Earned
Premium
Claims &
Comm
UW Profit
Mgmt Expenses
Net UW Profit
Investment Income
Provision Tax PAT
H1FY15
H1FY15
(RM’mil) 750.4 545.7 204.7 133.5 71.2 98.5 (6.3) 43.5 132.5
H1FY14 (RM’mil)
778.6 574.8 203.9 147.0 56.8 60.5 2.1 31.2 84.0
H1FY15 PAT H1FY14 PAT Positive growth in H1FY15 Contraction in H1FY15
H1FY15
vs
RM'mil H1FY14 H1FY15 H1FY14
39.6% 12.6%
Expenses ratio reflects insurance business only (exclude PPA amortisation)
38 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Auto
Financing,44%
3.0%
H1FY15 PAT (composition to Group)
• Profits impacted by lower income and higher provision, partially offset by lower expenses from continued cost management initiatives
• Income reflects realignment of loans portfolio and continued margin compression
• Wholesale banking delivered double-digit strong financing growth; Retail Banking remain focus on targeted loans growth
Islamic Banking
To be the Islamic Bank of choice Aspirations
Strong financing & CASA growth
4.4% Growth 5.3% 11.3% 12.9% 15.7%
12.1%
Outlook • Increase penetration of solutions and cross-selling to support AmBank Group as “main bank” initiatives
PAT
PAT H1FY14
Total Income
Expenses PBP Allowances PBT Tax PAT
H1FY15
H1FY15
(RM’mil) 422.6 175.4 247.1 91.4 155.8 35.2 120.6
H1FY14
(RM’mil) 441.8 180.8 261.0 82.1 178.9 41.8 137.1
H1FY15 PAT H1FY14 PAT Positive growth in H1FY15 Contraction in H1FY15
H1FY15
vs
RM'mil H1FY14 H1FY15 H1FY14
Gross Financing 22,321.8 24,297.6 ▲ +8.9%
Gross Impaired Loans 1.50% 341.5 365.6 ▲ +7.0%
Customer Deposits 23,476.1 25,377.6 ▲ +8.1%
CASA Deposits 5,638.5 5,254.0 -▼ -6.8%
ROA 0.81% 0.70% -▼ -0.11%
CTI 40.9% 41.5% ▲ +0.6%
Allowance Coverage 152.7% 148.8% -▼ -3.9%
11.5%
H1FY15 Gross Financing
39 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
• Income includes one-off divestment gain of AmLife and AmFamily businesses
• Higher expenses reflect continued investment (centrally accrued)
• MI represents non-controlling interests within the Group
Group Operating Segments
H1FY15 PAT (composition to Group)
>100.0% Growth >100.0% 54.1% 7.6% >100.0% >100.0% >100.0%
PAT
>100.0%
H1FY15 PAT H1FY14 PAT Positive growth in H1FY15 Contraction in H1FY15
PAT H1FY14
Total Income
Expenses PBP Allowances PBT Tax PAT MI PATMI H1FY15
H1FY15 (RM’mil)
511.1 212.3 298.8 68.4 230.5 33.1 197.3 65.8 131.5
H1FY14 (RM’mil)
91.8 137.8 (46.0) 63.6 (109.6) (38.8) (70.7) 42.5 (113.2)
54.9%
18.8%
40 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation Your Bank. Malaysia’s Bank. AmBank.
AGENDA Page
1. EXECUTIVE SUMMARY 2
2. H1FY2015 GROUP FINANCIAL PERFORMANCE 12
3. OUTLOOK & STRATEGIC PRIORITIES 28
4. DIVISIONAL STRATEGY & PERFORMANCE 34
5. SUPPLEMENTARY INFORMATION 40
- AMBANK GROUP
- ECONOMY & INDUSTRY
41 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
134.3 273.0
407.3
657.4
1,064.7
Sep'14
1.0% 7.0% 5.0% 0.7% 1.2%
5.2 11.9
17.1
68.2
85.3
Sep'14
RM’bil
Deposits profile
Source : BNM, internal reports
RM’bil
Savings Current Account CASA Fixed Deposits Core Deposits
Savings Current Account CASA Fixed Deposits Core Deposits
AmBank Group Deposits Growth by Type
Industry Deposits Growth by Type
1.7% 4.5% 3.6% 4.8% 3.3%
6.1%
13.9%
79.9%
AmBank Group Core Deposits Composition
Savings Current Account Fixed Deposits
12.6%
25.6%
61.7%
Industry Core Deposits Composition
Savings Current Account Fixed Deposits
42 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Diversifying funding sources and maturity profile
LDR1 of 89.3%
AmIslamic Bank Bhd
1. RM2b Subordinated Musyarakah Sukuk
2. RM3b senior sukuk musyarakah programme
3. RM3b Basel III-compliant Subordinated Sukuk Murabahah Programme via Tawarruq arrangement
AMMB Holdings Bhd
1. RM2b Medium Term Notes (Senior & Subordinated)
Funding diversity underpinned by
CASA: RM17.1 billion (yoy growth = 3.6%)
Fixed deposits: RM68.2 billion (strong retention)
Supplemented by term funding & debt capital
AmBank (M) Bhd
1. RM500m Innovative Tier 1 Capital Securities Programme
2. RM500m Non-innovative Tier 1 Capital Securities Programme
3. USD200m USD Subordinated Term Loan
4. RM2b Medium Term Notes
5. RM4b Tier 2 Subordinated Notes
6. RM7b Senior Notes2
7. USD300m Term Loan Facility
8. USD2b Euro Medium Term Notes
1. Includes stable funding sources 2. 1st senior notes issuance by a financial institution in Malaysia
AmBank (M) Bhd AmIslamic Bank
Bhd
Loans with Recourse
Recourse obligations on loans sold to Cagamas - maturing in 2017
Islamic financing
sold to Cagamas – maturing in 2016
• Statutory reserve and liquidity requirement savings
• Reduced exposure to interest rate risks
Funding characteristics
• Improve funding stability, maturity gap & liquidity ratios
• Reduce dependence on short-dated deposits to fund long-dated fixed rate loan assets which incur liquidity risk and interest rate risk
• Diversifies investor base
• No obligation for buy back since we are not exposed to withdrawal risks and the notes are traded in the open market
• Enable depositors to invest in long and medium dated papers
43 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
ANZ diversified footprints in Asia
Value proposition
• Seconding ANZ staff into key roles
• Providing technical expertise
• Support new product development
• Two-way customer referrals
• Joint account planning
• Access to regional network & connectivity
Board representation
• Shayne Elliot – Director (Chief Financial Officer, ANZ)
• Mark Whelan – Director (Managing Director, Corporate & Commercial, ANZ)
Management representation
• Mandy Simpson – Chief Financial Officer
• Nigel Denby – Chief Risk Officer
• Paul Lewis – Managing Director, Retail Banking
• Tan Chin Aun - Transaction Banking
• Oscar Demirtas - Senior Programme Manager, Small Business Banking
Partnership with ANZ
Source: Trade Finance Magazine 2013
CHINA
HONG KONG
PHILIPPINES
VIETNAM
NEW ZEALAND
SOUTH KOREA
JAPAN
TAIWAN
INDONESIA
AUSTRALIAPACIFIC ISLANDS
SINGAPORE
LAOS
THAILAND
CAMBODIAMALAYSIA
PAPUA NEW GUINEA
FIJI
INDIA
ANZ & AmBank Partnership
15 Asian markets, 98 branches and 5 Partnerships
44 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
IAG diversified footprints in Asia
Value proposition
• Involved in the management of AmGeneral Insurance, offering skills transfer, partnership and relationship models of IAG
• Adding value through claims re-engineering savings, increased revenue via product development, underwriting and pricing
Board representation
• Duncan Brain – Director (CEO, IAG Asia)
• Aidan Pallister – Director (Deputy CEO / COO of IAG Asia)
Management representation
• Derek Roberts – CEO, AmGeneral Insurance Berhad
• Arron Mann – General Manager, Claims
• Chris Tandy – General Manager, Personal and Commercial Pricing
Partnership with IAG
GENERAL INSURANCE
AmGeneral: Leveraging strategic partnership with global insurance partner
2 subsidiaries in Thailand & Vietnam Investment in associates in Malaysia, China & India
Source: IAG annual report 2014
45 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Branches ATM Regional Business Centres
Perlis 1 4
Kedah 5 29
Pulau Pinang 14 49 1
Perak 19 51
Selangor 34 260
Kuala Lumpur 30 142 1
Putrajaya 1 4
Negeri Sembilan 6 43
Melaka 5 38
Johor 21 97 1
Pahang 9 35 1
Terengganu 5 20
Kelantan 2 22
Sabah 9 36 1
Labuan 1 2
Sarawak 15 49 1
177 881 6
Multiple distribution channels aligned to demographics
Population Density: <100 persons per km2 101-500 persons per km
501-1,000 persons per km2 1,001--1,500 persons per km2
> 1,501 persons per km2
Perlis
Kedah
Pulau Pinang
Perak
Sarawak Kuala Lumpur
Putrajaya
Negeri Sembilan
Melaka Johor
Pahang
Singapore
Indonesia
Selangor
Labuan
Sabah Terengganu
Kelantan
AmIslamic branches
Weekend Banking Branches
ATMs @ 7-Eleven
Electronic Banking Centres
Internet & Mobile
Banking AmGeneral AmMetlife AmInvestment MBF
3 76 402 170 AmOnline AmGenie
32 (include 28
dual branded branches)
18 branches 52 agencies
14 26
Note(s):
Brunei: AmCapital (B) Sdn Bhd
Indonesia: PT.AmCapital Indonesia, PT.AMCI Manajemen Investasi Indonedia
Singapore: AmFraser Securities Pte Ltd
Brunei Darussalam
Nationwide Branch Network
Other Customer Touch Points
46 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Solid shareholding structure & franchise value
AMMB Holdings Berhad
23.8%1 AmCorp 13.3% EPF 14.2% Others 48.7%
100% AmBank (M) Berhad
100% AmInvestment Group Berhad
100% AmInvestment Bank Berhad
FY2010 FY2011 FY2012 FY2013 FY2014 H1FY2015
27% 27% 26% 29% 31% 32%
1.ANZ: ANZ Funds Pty Ltd,a wholly owned subsidiary of Australia and New Zealand Banking Group Limited 2.Formerly known as AmG Insurance Berhad 3.Formerly know as Kurnia Insurans (Malaysia) Berhad 4.MetLife owns 50% plus one share in AmMetLife Insurance Berhad, with the remaining shares held by AmBank Group, and AmBank Group owns 50% plus one share in AmMetLife Takaful Berhad, with the
remaining shares owned by MetLife
Foreign shareholding excluding ANZ
100% AmIslamic Bank Berhad
100% MBF Cards (M’sia) Sdn Bhd
33.33% Bonuskad Loyalty Sdn Bhd
100% AMAB Holdings Sdn Bhd
51% AmGeneral Holdings Berhad2
~50% AmMetLife Takaful Berhad4
~50% AmMetLife Insurance Berhad4
100% AmGeneral Insurance Berhad3
49%
~50%
~50%
As at 30 Sept 2014
Retail Banking Wholesale Banking
Islamic Banking General
Insurance Life Assurance &
Takaful
47 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Buy/Outperform/Overweight/Add P/EPS : EPS for FY2014, P/BV : BV as at 30 June 2014
Banking sector share price movement / target price and recommendations
10.9%
18.2%
36.1%
75.5%
87.1%
99.2%
158.8%
0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0% 140.0% 160.0% 180.0%
(Note: 18 May 2007 vs. 30 Sept 2014)
Ratings FY2007 H1FY2015
AmBank (M) RAM A2/P1/Stable AA2/P1/Stable
Fitch BBB-/F3/Stable BBB/F3/Stable
S&P BBB-/A-3/Stable BBB+/A-2/Negative
Moody’s Baa2/P-3/Stable/D- Baa1/P-2/Stable/D+1
AmInvestment RAM AA3/P1/Stable AA2/P1/Stable
Fitch BB+/B/Stable BBB/F3/Stable
AmIslamic RAM A2/P1/Stable AA2/P1/Stable
AMMB RAM NA AA3/P1/Stable
TP: target price
Sell/Underperform/Fully valued/Reduce/Underweight
Hold/Neutral/Market perform Source : Bloomberg as at 14 Nov 2014
1 BFSR - Banking Financial Strength Rating
+3
+1
+2
+2
+3
+1 Notches of ratings upgrades
+1
AMMB HOLDINGS BERHAD P/EPS : 9.13 P/BV : 1.42
Market Price : RM6.52
Banking Sector Share Price Movement Upgraded ratings
Target Price and Recommendations
+3
Average TP : RM7.37 Buy : 5 (20%) Sell : 6 (24%) Hold : 14 (56%) Average TP / Average CP : 1.14x
25
Au
g 1
4
25
Au
g 1
4
48 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Strategic Business Transformation: Continued Progress
Set Group’s MTA, transformation strategy, agenda and targets Enhanced focus on asset quality and risk reward trade offs Realigned business model towards profitable segments in HP, mortgage & fixed income Consolidated Group balance sheet activities within commercial bank Split composite insurance license to General and Life
High Priority Growth
Initiatives
Governance & Enablement Functions
Created deposit businesses as profit centres across Group Commenced realigning non-retail customer segmentation and divisional focus Proactively strengthened capital and liquidity management Repositioned balance sheet for rising interest rates Completed realignments in non-retail customer centric business models Continued expanding product offerings and new capabilities in Markets division Balance sheet funding strengthened via long term fund raisings
Developed retail focus customer centric business models Implemented basic account plans for business customers to increase SOW Initiated Group Rebranding programme Initiated revamping of branches to refresh customer experience Realigned account management teams for more effective account planning
Launched a new brand re-positioning, “Your Bank. Malaysia’s Bank. AmBank.”, a new chapter for our brand to deliver a unique AmBank Group experience to our customers
Launched new corporate website (www.ambankgroup.com) enhancing mobile and tablet responsiveness
New consolidated Wholesale Banking model implemented to improve client centricity, efficiency and productivity
Rolled out new Small Business Banking model targeting non-individual customers in Retail banking
FY2015 & FY2014
FY2012 & FY2013
FY2010 & FY2011
FY2008 & FY2009
Strategic Business
Transformation
49 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
High Priority Growth Initiatives: Implemented To-Date
Created new profit centre based retail branch distribution model Created a separate Corporate and Institutional Banking (CIB) Division Developed new FX business in collaboration with ANZ Enhanced cash management offering via Gross Payroll system Friends Life brought in as new life strategic business partner
Accelerated building of scale in non-retail customer businesses Increased focus on GLC, GLIC and MNC businesses Developed new Rates business in collaboration with ANZ Expanded distribution footprint (particular focus on 7-11 ATM’s) & alternative channels Commenced activities to leverage ANZ International connectivity Developed new wealth management business strategies Created a new Transaction Banking business focusing on trade and cash management
Inked business principle agreements with ANZ to leverage international connectivity Commenced a new family Takaful business with Friends Life Commenced Priority Banking expansion initiatives Completed Kurnia & MBF Cards acquisitions and commence integration Repurchased remaining shareholding in AmLife and AmTakaful Secured approval as Private Retirement Scheme (PRS) provider Established partnership with Travelex for money changing services
Sealed strategic partnership with MetLife in Life Assurance and Family Takaful Channels re-organisation to improve customer connectivity and experience (e.g. branch re-
design and rationalisation; reposition digital banking) Pursuing “Save to Invest” programme to achieve cost synergies across the Group Undertaking segmentation activities to enhance cross-selling to grow Main Bank relationships Initiated account joint-planning within non-retail divisions to increase trade utilisation &
business deals
Strategic Business
Transformation
Governance & Enablement Functions
FY2015 & FY2014
FY2012 & FY2013
FY2010 & FY2011
FY2008 & FY2009
High Priority Growth
Initiatives
50 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Rebuilding AmBank’s “Core Banking System” via AmHorizon, creating a scalable and robust platform for growth with enhanced customer experience, Phase 1 went live in end 2013. Commenced Phase 2 of Core Banking System and its supporting applications
Implementing Multichannel payment switch solutions to consolidate multiple switches on different platforms for efficiency and faster time to market
Financial Holding Company structure being progressed for full compliance with FSA & IFSA Streamlining of subsidiaries and releasing of dormant entities’ capital Reviewing Internal Rating Based approach to optimise capital management Building AIRB capabilities
to improve risk management and increase capital efficiency Enterprise Process Platform (EPP) going live to support lending operations Completed risk management recalibration (simplified AF & WB risk processes, non-retail pricing tool)
Governance and Enablement Functions Streamlined: Supports Better Decision Making
Privatised AmInvestment Bank as part of migration to universal banking platform Consolidated / simplified governance committee structures and strengthen risk disciplines Created a Group PMO to prioritise and manage key strategic initiatives Established Advance Risk Recognition Program (ARRP) Separated ALCO, capital and balance sheet management from Markets Delivered Peer Bank relative performance benchmarks Implemented short and long term performance incentives
Delivered 8 new generation retail scorecards & new market risk models Commenced PD, LGD & EAD models for retail and non-retail, non-retail security indicators Developed leadership bench-strength and succession planning Implemented Operational Risk Incident Reporting system and Basel II capital calculator Implemented FTP system aligned to balance sheet strategies Consolidated some Group Support into Centres of Excellence Initiated new retail and non retail PD / LGD models, Security Indicators, Collateral management, and
Market risk system (VIPER) Initiated core banking system replacement programme
Strategic Business
Transformation
High Priority Growth
Initiatives
Implemented a new ALM system and divisional capital allocations under Basel II Integrate new Basel III frameworks into planning processes Finalised vendor selection and commenced core banking system replacement Developed AmFamily Takaful system to support commencement of Takaful business Implemented Model Execution Platform (MEP) provisioning methodology for better risk assessment
and pricing capabilities Transitioned to full MFRS 139 compliance on collective provisioning for credit risk Developing new behavioral scoring models for Retail and SME portfolio
FY2015 & FY2014
FY2012 & FY2013
FY2010 & FY2011
FY2008 & FY2009
Governance & Enablement Functions
51 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation Your Bank. Malaysia’s Bank. AmBank.
AGENDA Page
1. EXECUTIVE SUMMARY 2
2. H1FY2015 GROUP FINANCIAL PERFORMANCE 12
3. OUTLOOK & STRATEGIC PRIORITIES 28
4. DIVISIONAL STRATEGY & PERFORMANCE 34
5. SUPPLEMENTARY INFORMATION 40
- AMBANK GROUP
- ECONOMY & INDUSTRY
52 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
3.0%
2.7%
0%
1%
2%
3%
4%
5%
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
June
Sept
2010 2011 2012 2013 2014
CPI Unemployment (May)
6.4%
5.0%
7.2%
0%
5%
10%
15%
20%
25%
30%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2010 2011 2012 2013 2014
GDP Consumption Investment
113.0
0.0
20.0
40.0
60.0
80.0
100.0
120.0
140.0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2008 2009 2010 2011 2012 2013 2014
BCI
Malaysian economy is on a steady growth trajectory
Business Conditions Index
Moderating growth
Business confidence is improving
Upward pressure on inflation remains, unemployment rates stable
FDIs remain robust
points
Source: BNM & Bloomberg
18.5
12.2
-10
0
10
20
30
40
50
Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2
2008 2009 2010 2011 2012 2013 2014
TD FDI (Q1)
RM' bil
53 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
594.2
674.2
765.0
44%
18%
17%
6%
8%4%4%
-
100.0
200.0
300.0
400.0
500.0
600.0
700.0
800.0
900.0
2010 2011 2012 2013
HH debt Residential property Hire purchasePersonal financing Securities Non-residentialCredit card Others
4.53%
3.00%
6.53%
0%
5%
10%
15%
2006 2007 2008 2009 2010 2011 2012 2013
Average lending rate (commercial banks) Average OPR Average BLR
Well-contained risks despite increase in household indebtedness
To be updated for the his
Household debt by compositions
Interest rates expected to remain in the short term
Improving asset quality
Source: BNM
RM’bil % of composition
594.2
674.2
765.0
44%
18%
17%
6%
8%4%4%
-
100.0
200.0
300.0
400.0
500.0
600.0
700.0
800.0
900.0
2010 2011 2012 2013
HH debt Residential property Hire purchase Personal financing Securities Non-residential Credit card Others
Loan loss coverage Gross impaired loans
Others Credit card
Non-residential
Securities
Personal financing
Hire purchase
Residential property
* Retail comprise purchase of transport vehicle, purchase of residential property, personal use and credit card
53
34.2% 34.6% 31.9% 30.1%
74.5% 76.2%81.3%
86.8%
25.0%19.7%
16.3% 14.6%0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
2010 2011 2012 2013
Gross national savings Household debt/GDP
Retail impaired loans ratio*
Higher household debt, but retail impaired loans ratio trending down
1.7%
80.0%
85.0%
90.0%
95.0%
100.0%
105.0%
110.0%
0%
1%
1%
2%
2%
3%
3%
4%
4%
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
June
Sept
2010 2011 2012 2013 2014
Gross impaired loans Loan loss coverage
54 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
8.8
24.9
0
5
10
15
20
25
30
35
40
45
50
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2010 2011 2012 2013 2014
New issues of equity New issues of debt
82.1%
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2011 2012 2013 2014
Total deposits LD ratio
8.8%
9.1%
9.0%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
Mar June Sept Dec Mar June Sept Dec Mar June Sept Dec Mar June Sept Dec Mar June Sept
2010 2011 2012 2013 2014
Retail yoy growth Non Retail yoy growth Total loans yoy growth
15.5%
13.5%
12.8%
0%
5%
10%
15%
20%
Mar
June
Sept
Dec
Mar
Jun
Sep
Dec
Mar
Jun
Sep
Dec
Mar
Jun
Sep
Dec
Mar
June
Sept
2010 2011 2012 2013 2014
RWCAR Tier 1 CET 1
Source: BNM
Capital remains sound in the banking sector, loans growth moderating
RM’mil
Capital levels above BNM’s Basel 3 guidelines
Capital activities supported by debt issuance
Sustained deposits growth provides liquidity
Beginning January 2013, capital components are reported based on Basel III Capital Adequacy Framework
RM’bil
Basel II Basel III
Moderating loans growth
55 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
ETP: Propelling Malaysia towards becoming a high-income, developed nation by 2020
• RM48k (USD15k)
GNI per capita
• RM1.7 trillion GNI
• 6% annual GDP
growth
GROSS NATIONAL INCOME
JOBS
• 31.6m population
• 3.3m additional jobs
TRANSFORMATIONAL ACTIONS
INVESTMENT
Focus Drivers:
• 12 NKEAs, 131 EPPs
• 60 Biz Opportunities
• Private-sector led
Competitiveness ‘Enablers’
• 6 SRIs & 51 Policy Measures
• RM1.4 trillion investment
• 92% private investment
• 8% public investment
• 73% DDI, 27% FDI
ECONOMIC TRANSFORMATION
PROGRAMME
ETP Overview Achievement of 12 NKEAs in 2012 and 2013
2020 Target
2011 2012 2013 To-date % of Target
EPPs 110 39 47 196
Investment (RM’bil) 794.5 179.2 32.1 8.0 219.3 27.6%
GNI (RM’bil) 961.0 129.5 6.6 7.4 143.5 14.9%
Job Creation 3.3 mil 313,741 94,702 29,373 437,816 13.3%
Note: • Scoring is calculated by a simple comparison against set 2013 and 2012 targets respectively. (*) The overall NKEA composite scoring is the average of all scores. • Data was correct as on ETP announcement date, the ETP is an evolving programme, in the past 2 years, some EPPs have been dropped, some new ones were added ETP : Economic Transformation Programme Source ETP Annual Report 2012 & 2013, Maybank Resaerch Report
Tracking of EPPs
NKEAs
2020 Target KPI Scoring*
GNI (RM’bil)
New Jobs 2013 2012
Greater KL/ Klang Valley 190 320,000 98% 108%
Oil, Gas & Energy 131.4 52,300 97% 119%
Financial Services 180.2 275,400 117% 111%
Wholesale & Retail 55.4 454,190 124% 153%
Palm Oil & Rubber 230.9 41,600 78% 101%
Tourism 66.7 497,000 115% 117%
Electrical & Electronics 53.4 157,000 105% 95%
Business Services 78.7 245,000 102% 114%
Communications Content & Infrastructure
57.7 43,162 101% 153%
Education 33.6 535,000 102% 121%
Agriculture 28.9 109,335 98% 130%
Healthcare 35.3 181,000 103% 105%
56 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
2,073
2,935
3,417
5,450
11,387
55,568
Vietnam
Phillippines
Indonesia
Thailand
Malaysia
Singapore
0.0
5.7
-0.6
-2.3
-2.6
-3.5
Vietnam
Singapore
Thailand
Philippines
Indonesia
Malaysia
Malaysia remains an attractive investment destination
GDP per capita, 2014 (USD)
4.1 3.6
4.7 5.2
2.9 2.5
5.8 5.4
7.2 6.5
5.4 5.6 0.7%
2.0%
3.0%
4.4%
6.1%
6.9%
Thailand
Singapore
Malaysia
Vietnam
Indonesia
Philippines
2.3%
2.3%
3.3%
4.0%
6.3%
5.5%
Singapore
Thailand
Malaysia
Philippines
Vietnam
Indonesia
Unemployment (%) Inflation (%)
5.5
30.1
68.6
90.6
99.4
251.5
Singapore
Malaysia
Thailand
Vietnam
Philippines
Indonesia
23.0
29.6
28.1
31.2
30.4
44.8
Philippines
Vietnam
Thailand
Malaysia
Indonesia
Singapore
Population (mil) Savings rate (% of GDP)
-3.0
0.2
3.2
4.1
4.3
18.5
Indonesia
Thailand
Philippines
Malaysia
Vietnam
Singapore
Current Account Balance (% of GDP)
Government structural Balance (% of GDP)
Real GDP growth 2013 2014F
Source: World Economic Outlook Database April 2014
57 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Glossary / Disclaimer of warranty and limitation of liability
Reported Performance Reported performance refers to the financial performance as reported in the audited financial statements and disclosed to the market
One Offs One offs comprise those impacts on financial performance that arise from changes to :
• accounting and provisioning policies (eg 5 and 7 year rules) • differences between economic and accounting hedges • prior period catch ups (eg backdated salary costs) • strategic investments and divestments (eg ANZ partnership), and • tax and regulatory regimes (eg deferred tax asset write off due to reduction in corporate tax rates)
Underlying Performance Underlying performance refers to the financial performance adjusted for one off impacts as above Business Divisions
Business divisions • comprise AmBank Group’s core operating businesses that generate profits from direct customer transactions and interactions • have relatively more stable income streams, incur the bulk of the costs and typically have a lower risk profile • in most instances have market shares and growth metrics that can be measured and benchmarked externally
Operating Segments Operating segments
• have more volatile and lumpy income streams, with the former a direct function of risk appetite • include
• income and expenses associated with shareholder funds, loan rehabilitation and legacy businesses, plus • costs associated with corporate, shared services and governance functions currently not charged back to the business units
The information provided is believed to be correct at the time of presentation. AMMB Holdings Berhad or AMMB Holdings or “AMMB” or its affiliates do not make any representation or warranty, express or implied, as to the adequacy, accuracy, completeness or fairness of any such information and opinion contained and shall not be liable for any consequences of any reliance thereon. Neither AMMB Holdings nor its affiliates are acting as your financial advisor or agent. The individual is responsible to make your own independent assessment of the information herein and should not treat such content as advice relating to legal, accounting, and taxation or investment matters and should consult your own advisers.
Forward looking statements are based upon the current beliefs and expectations of the AMMB Holdings and are subject to signif icant risks and uncertainties. Actual results may differ from those set forth in the forward looking statements. AMMB Holdings does not undertake to update the forward looking statements to reflect impact of circumstances or events that may arise after the date of this presentation.
The information in the presentation is not and should not be construed as an offer or recommendation to buy or sell securities. Neither does this presentation purport to contain all the information that a prospective investor may require. Because it is not possible for AMMB Holdings or its affiliates to have regard to the investment objectives, financial situation and particular needs of each individual who reads the information contained thus the
information presented may not be appropriate for all persons. The information contained is not allowed to be reproduced, redistributed, transmitted or passed on, directly or indirectly, to any other person or published electronically or via print, in whole or in part, for any purpose.
The term "AMMB Holdings" and “AmBank Group” denotes all Group companies within the AMMB Holdings Group and this Disclaimer of Warranty and
Limitation of Liability policy applies to the financial institutions under AMMB Holdings.
Disclaimer of Warranty and Limitation of Liability
58 Your Bank. Malaysia’s Bank. AmBank.
H1FY2015 Results – Investors Presentation
Glossary / Disclaimer of warranty and limitation of liability
The information provided is believed to be correct at the time of presentation. AMMB Holdings Berhad or AMMB Holdings or “AMMB” or its affiliates do not make any representation or warranty, express or implied, as to the adequacy, accuracy, completeness or fairness of any such information and opinion contained and shall not be liable for any consequences of any reliance thereon. Neither AMMB Holdings nor its affiliates are acting as your financial advisor or agent. The individual is responsible to make your own independent assessment of the information herein and should not treat such content as advice relating to legal, accounting, and taxation or investment matters and should consult your own advisers.
Forward looking statements are based upon the current beliefs and expectations of the AMMB Holdings and are subject to signif icant risks and uncertainties. Actual results may differ from those set forth in the forward looking statements. AMMB Holdings does not undertake to update the forward looking statements to reflect impact of circumstances or events that may arise after the date of this presentation.
The information in the presentation is not and should not be construed as an offer or recommendation to buy or sell securities. Neither does this presentation purport to contain all the information that a prospective investor may require. Because it is not possible for AMMB Holdings or its affiliates to have regard to the investment objectives, financial situation and particular needs of each individual who reads the information contained thus the information presented may not be appropriate for all persons.
The information contained is not allowed to be reproduced, redistributed, transmitted or passed on, directly or indirectly, to any other person or published electronically or via print, in whole or in part, for any purpose.
The term "AMMB Holdings" and “AmBank Group” denotes all Group companies within the AMMB Holdings Group and this Disclaimer of Warranty and Limitation of Liability policy applies to the financial institutions under AMMB Holdings.
Disclaimer of Warranty and Limitation of Liability
Your Bank. Malaysia’s Bank. AmBank.
The material in this presentation is general background information about AmBank Group’s activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate.
For further information, visit www.ambankgroup.com;
or contact [email protected]