SBM Group Analyst Meeting FY 2017 Highlights 5 April 2018
DISCLAIMER This document has been prepared by SBM Group (SBM Holdings Ltd and its subsidiaries) (the Group) for general circulation and is meant solely for information purpose, without taking into consideration any objective or aim of whoever is receiving this document. SBM Group does not, in any way whatsoever, warrant expressly or impliedly the accuracy and completeness of the contents of this publication and shall not be liable for any loss or damage (including, without limitation, damages for loss of business or loss of profits) or prejudice of any nature whatsoever, arising in contract, tort or otherwise suffered by any person / entity relying on the information contained in this document or arising from any shortcoming, mistake, omission, defect or inaccuracy, in the document arising through inadvertence or any other reason. This document is owned by SBM Group and no part of this publication may be reproduced or transmitted in any form or by any means, including photocopying and recording, or by any information storage and retrieval system without the permission of the organization. 2
AGENDA • Financial Highlights • Share Price Info • Focus Areas Going Forward • Q & A 3
SBM HOLDINGS LTD CONSOLIDATED KEY FINANCIAL HIGHLIGHTS TOTAL ASSETS TOTAL DEPOSITS MUR 194.02 billion MUR 145.54 billion 31 Dec 2017 31 Dec 2017 31 Dec 2016 31 Dec 2016 MUR 146.90 billion MUR 111.85 billion NET LOANS & ADVANCES TOTAL LIABILITIES MUR 103.13 billion MUR 168.86 billion 31 Dec 2017 31 Dec 2017 31 Dec 2016 31 Dec 2016 MUR 71.62 billion MUR 123.09 billion SHAREHOLDERS’EQUITY MUR 25.16 billion 31 Dec 2017 31 Dec 2016 MUR 23.80 billion 4
SBM HOLDINGS LTD CONSOLIDATED KEY FINANCIAL HIGHLIGHTS NET INTEREST NON INTEREST OPERATING PROFIT AFTER INCOME INCOME INCOME TAX MUR 7,572 M MUR 4,768 M MUR 2,804 M MUR 2,575 M 31 Dec 2017 31 Dec 2017 31 Dec 2017 31 Dec 2017 (31 Dec 2016 : (31 Dec 2016: (31 Dec 2016 : (31 Dec 2016 : MUR 6,446 M) MUR 4,383 M) MUR 2,063 M) MUR 2,309 M) 5
GROUP PROFIT FOR DECEMBER 2017 INCREASED… MUR Million 2,575 2,600 2,309 2,400 2,200 2,000 1,800 1,608 1,600 1,400 1,200 1,000 800 600 400 200 0 Dec-15 Dec-16 Dec-17 6
… MAINLY DUE TO INCREASE IN NET INTEREST INCOME AND NON INTEREST INCOME, TEMPERED BY A SIGNIFICANT RISE IN OPERATING EXPENSES AND PORTFOLIO IMPAIRMENT CHARGES MUR Million +35.9% +23.6% 3,500 647 741 3,000 +8.8% -14.0% 321 +10.3% 95 2,500 384 90 78 2,000 2,575 2,309 1,500 1,000 PAT Dec Net Non Non Portfolio Specific Share of Tax PAT Dec 16 interest interest interest Charge Prov & profit of 17 income income expenses Write offs associate 7
ROE RECOVERED SLIGHTLY, BUT ROA DROPPED % 12 10.04 10.52 10 8 7.26 6 4 1.51 1.63 2 1.23 - Dec-15 Dec-16 Dec-17 Return on Assets Return on Equity 8
TOTAL ASSETS GREW SUBSTANTIALLY BY 32% DRIVEN BY SIGNIFICANTLY HIGHER SEGMENT B ASSETS MUR Billion 250 200 194.0 150 146.9 145.5 136.2 100 111.9 105.0 103.1 71.6 68.8 50 40.0 39.4 37.4 0 Total Deposits Net Loans & Investment securities Total Assets Advances Dec-15 Dec-16 Dec-17 9
YIELDS DECLINED DUE TO (i) HIGHER MIX OF SEGMENT B ASSETS (ii) EXCESS LIQUIDITY IN DOMESTIC MARKET AND (iii) DROP IN REPO RATE % Yield on advances Yield on investment % 9.00 5.00 7.06 6.26 4.05 3.90 4.00 6.00 5.73 3.56 3.00 3.00 Dec-15 Dec-16 Dec-17 Dec-15 Dec-16 Dec-17 10
DEPOSIT MIX REMAINED WELL BALANCED Dec-15 Dec-16 Dec-17 16% 23% 18% 37% 38% 37% 44% 47% 40% Demand Savings Term 11
COST OF FUNDS IMPROVED SLIGHTLY AMIDST HIGH LIQUIDITY AND HIGHER MIX OF FCY DEPOSITS % 2.50 2.06 2.00 1.61 1.56 1.50 1.00 Dec-15 Dec-16 Dec-17 Cost of funds 12
OVERALL, NIM NARROWED BY 30 BPS % 4.00 3.50 3.22 3.10 3.00 2.80 2.50 Dec-15 Dec-16 Dec-17 Net Interest Margin 13
NONETHELESS, NET INTEREST INCOME RECORDED APPRECIABLE GROWTH ON THE BACK OF THE STRONG ASSETS GROWTH Dec-15 Dec-16 Dec-17 8.8% 4,768 MUR Million 3.1% 4,383 4,253 14
NON-INTEREST INCOME WAS SUPPORTED BY AN APPRECIABLE INCREASE IN NET TRADING INCOME AND FEES & COMMISSION 31 Dec 15 31 Dec 16 31 Dec 17 MUR Million Net Fees & 1,029 1,053 1,240 +18% Commission Dividend 157 39 22 - 45% Income Net trading 528 515 1,093 +112% income Other income 289 456 449 -2% (e-business, etc.) Total 2,003 2,063 2,804 Non-Interest +36% Income 15
HENCE, GROSS OPERATING INCOME GREW BY 17.5% MUR Million 8,000 7,572 7,000 6,446 6,255 2,804 6,000 2,063 2,003 5,000 4,000 3,000 4,768 4,383 4,253 2,000 1,000 - Dec-15 Dec-16 Dec-17 Net Interest Income Non Interest Income 16
WHILE NON INTEREST EXPENSES INCREASED SIGNIFICANTLY AMIDST CAPACITY BUILDING INITIATIVES AND CONTINUOUS INVESTMENT IN TECHNOLOGY… MUR Million 3,500 670 3,000 350 2,500 162 1,099 2,000 996 872 1,500 1,000 1,619 1,396 1,237 500 0 Dec-15 Dec-16 Dec-17 Personnel Expenses Other Expenses Depreciation & Amortisation 17
… RESULTING IN A RISE IN THE COST TO INCOME RATIO % 50.00 48.00 46.00 44.75 44.00 42.53 42.00 40.00 38.00 36.30 36.00 34.00 32.00 30.00 Dec-15 Dec-16 Dec-17 18
BOTH GROSS IMPAIRMENT RATIO AND NET IMPAIRED RATIO IMPROVED MUR Million 7.00% 6.60% 5,000 4,998 4,789 5.14% 4,000 5.00% 4.47% 3,712 3,000 2,000 3.00% 2.64% 1.89% 1.98% 1,000 0 1.00% Dec-15 Dec-16 Dec-17 Impaired Advances Gross impaired / Gross Advances (%) Net Impaired / Net Advances (%) For the year ended December 2017, SBM Mauritius Ops and SBM Indian Ops booked write offs of MUR 1.3 Bn and MUR 296 M respectively out of existing provisions. 19
CAPITAL ADEQUACY RATIO REMAINED WELL ABOVE REGULATORY REQUIREMENTS, ALBEIT DECREASING IN LINE WITH STRONG ADVANCES GROWTH % MUR Bn 30.00 28.26 30.00 25.70 25.00 25.00 5.10 5.43 5.46 20.00 20.00 19.98 15.00 15.00 18.60 18.25 10.00 20.01 10.00 5.00 - 5.00 Dec-15 Dec-16 Dec-17 Tier 1 Capital MUR Bn Tier 2 Capital MUR Bn Capital adequacy ratio 20
AGENDA • Financial Highlights • Share Price Info • Focus Areas Going Forward • Q & A 21
EARNINGS PER SHARE IMPROVED, REFLECTING THE PROFIT TREND Cents 120 99.73 100 89.43 80 62.27 60 40 20 0 Dec-15 Dec-16 Dec-17 Note: Share information prior to 19 October 2016 has been restated to reflect reverse share split of 10:1 effective that date. 22
23 Index BUT SHARE PRICE PERFORMANCE CONTINUED TO BE SUBDUED 1700 1800 1900 2000 2100 2200 2300 2400 02/01/2017 17/01/2017 01/02/2017 16/02/2017 03/03/2017 18/03/2017 02/04/2017 17/04/2017 02/05/2017 17/05/2017 SBMH (Jan 2017 - Mar 2018) 01/06/2017 SEMDEX (LHS) 16/06/2017 01/07/2017 16/07/2017 31/07/2017 15/08/2017 30/08/2017 SBMH (RHS) 14/09/2017 29/09/2017 14/10/2017 29/10/2017 13/11/2017 28/11/2017 13/12/2017 28/12/2017 12/01/2018 27/01/2018 11/02/2018 26/02/2018 13/03/2018 28/03/2018 6 6.5 7 7.5 8 8.5 Price (MUR)
…REFLECTED IN A LOW PRICE TO BOOK RATIO 0.90 0.85 0.83 0.80 Times 0.77 0.75 0.72 0.70 0.65 0.60 Dec-15 Dec-16 Dec-17 24
DIVIDEND YIELD REMAINED STRONG % 6.50 6.02 6.00 5.63 5.33 5.50 5.00 4.50 3.73 4.00 3.29 3.50 2.96 3.00 2.50 2.00 Dec-15 Dec-16 Dec-17 SBM Market 25
…AND PE RATIO ATTRACTIVE COMPARED TO THE MARKET 17.00 16.39 16.50 16.00 15.50 15.00 14.50 14.00 13.50 13.00 11.83 12.50 12.49 12.00 11.50 11.00 11.40 10.50 10.00 9.50 9.00 8.50 8.00 7.50 7.52 7.00 7.42 6.50 6.00 Dec-15 Dec-16 Dec-17 SBM Market 26
AGENDA • Financial Highlights • Share Price Info • Focus Areas Going Forward • Q & A 27
OUR FOCUS AREAS: MAURITIUS Retail Banking • Digitalisation to sustain/grow market share and reduce cost of operations • Cross-selling to grow products per customer • Improve level of customer service • Reduce cost to serve through migration to lower cost channels Domestic Corporates and SMEs • Sales process efficiency to grow market share • Move up the value chain to meet client needs and raise share of fee-based income 28
OUR FOCUS AREAS: MAURITIUS International Banking • Leverage international presence • Cross-selling across Group entities Private Banking & Wealth Management • Product and market diversification Non-Banking Financial Services • Product development and product scale • Synergy with other entities of the Group • Investment banking deals 29
OUR FOCUS AREAS: INDIA Revamp customer value proposition to build a healthy book • and gain market share with a respectable Indian lender status • Exploit India/Mauritius/Kenya/Madagascar linkages to grow both funded and non-funded business • Tap into synergistic opportunities with other entities of the Group through cross-selling • Grow presence and capability, based on customer value proposition • Manage impaired assets and recovery from written- off/provisioned assets 30
OUR FOCUS AREAS: KENYA • Stabilisation and integration (subject to deal completion) • Take advantage of the combined strength to grow business in the target segments • Tap into synergetic opportunities with other entities of the Group • Align policies to Group policies, particularly in areas of risk and compliance 31
Recommend
More recommend
