The National Commercial Bank Investor Presentation 3Q 2019 Results 1
Investor Page Page Page Presentation 3 9 17 Content NCB – The Grow with KSA Strategy leading KSA Bank Grow with NCB Overview Page Page Page 26 34 48 Financial Results Financial Results Segmental Highlights Details Overview Page Page 55 58 Key Performance Additional Information Indicators 2
The Leading KSA Bank 3Q 2019 Results
Ov Over erview ew The National Commercial Bank The Nation’s Gateway of Progressive Banking NCB’s vision is to be the premier financial NCB realizes that it can be a powerful force for 10.7 services group in the region. To achieve this, good in the communities it serves, leading by five strategic aspirations have been defined: example and acting responsibly and contributing to the empowerment of the community. NCB 1. to be number one in revenues, empowers financial planning, saving and 2. to be number one in profit, borrowing to help its customers meet their 3. to be the best digital bank, financial aspirations and invests in community BILLION 4. to be the best in customer service; and development through its Ahalina CSR Program. It 5. to be the employer of choice. is also a major employer, with a commitment to creating career opportunities for a growing and Since its establishment in 1953, NCB has evolved ambitious Nation. Beginning with its IPO in 2014 into a broad-based financial services group and and recent inclusion into major Emerging Market NCB generated SAR 10.7bn of Net holds a leading market position. The banking indices, NCB has enjoyed the privilege of sharing Income before Zakat and income tax, the highest in its history and group has a strong performance track record, its successes with a widened investor base. As the highest among Saudi banks mirroring the Kingdom’s progress towards such NCB has effectively partnered with its for the sixth successive year. modernization and development. Today, NCB has stakeholders delivering market leading banking a unique bond of trust with its customers. The services as well as record profitability, Over each bank leverages its investment in technology and of the past six consecutive years from 2013, NCB commitment to enhancing the customer has delivered the highest net income before zakat experience, delivering a comprehensive suite of and income tax ever achieved by a Saudi Bank. financial products and services to 6 million KSA This trend was upheld in 2018 when NCB based customers, across all major market delivered SAR 10.7 billion in Net Income before segments. Zakat and income tax. NCB Investor Relations | 3Q 2019 Investor Presentation 4
NCB is the leading banking group in ⎮ Established in 1953; IPO in 2014 Saudi Arabia (3Q 2019 Snapshot) SAR SAR SAR 8 m 12,680 340bn 138bn 498bn Clients Employees* Deposits Market Cap Assets Who holesal ale b bran ranche hes i in B Bahrai ahrain & & S Singap apore re Offices in Seoul & Shanghai In Inte tern rnati ational al: Cap apital al M Mark arkets Subsid idia iary in in KSA Subsidiary ary i in Turk rkey NCB Capital (NCBC) Türkiye Finans Katılım Bankası (TFKB) Largest Asset Manager in KSA 310 branches, 602 ATMs Largest Shariah-compliant 3,487 employees NCB G NC B Group Asset Manager worldwide Top 2 Broker Headquartered in Saudi Arabia 22 locations 239 Employees 420 branches, 3,625 ATMs 138 Remittance centers 7,386 Employees 97% Saudization 100% CEO DRs are Saudi *Includes Alahli Esnad (1,568 employees) - fully owned subsidiary engaged in outsourcing and manpower services in KSA 5 NCB Investor Relations | 3Q 2019 Investor Presentation
NCB has a well-diversified ⎮ Total operating income contribution 9M 2019 business model 3.0 bn 20% TREASURY SAR 13.4 bn 1.0 bn 561 mn 90% 3% 7% 2.9 bn 20% CORPORATE International (TFKB) Capital Markets (NCBC) NCB 7.5 bn 50% RETAIL 6 NCB Investor Relations | 3Q 2019 Investor Presentation
NCB Group listed on Tadawul ⎮ Ranked third in Tadawul, S&P Pan Arab and MSCI Indices with significant weightings in November 2014 Float at A Adj. j. Mcap ap Share hare parame arameters rs 30 0 Se Sept 201 019 MSCI CI Sau audi A Arab rabia Index ex Wei eighting (%) %) (USDb (U Db) Closing Price (SAR) 46.05 Al Rajhi Banking & Investment 20.67 14.83 52 week range (SAR) 39 – 65 Saudi Basic Industries Corporation 18.39 13.20 Free Float 45% Nat ational al Commercial al B Ban ank 14. 4.73 10.5 0.57 Shares issued (mn) 3,000 Saudi Telecom Company 11.60 8.33 Book Value (SARmn) 60,425 Riyad Bank 7.81 5.60 BVPS 19.99 Source: MSCI, 30 September 2019 P/B Ratio 2.8x P/E Ratio (FY 2018 earnings) 18x Div Yield (FY 2018 dividends) 3.73% 3m Avg Daily Volume (shares) 3,340,039 Source: NCB, Bloomberg Share hare p pri rice p perf rforman rmance since IP IPO (SAR) Rati atings LT LT ST ST Outlook ook (Adj p (Ad price) Nat ational al Commercial al B Ban ank 70 S&P BBB+ A-2 Stable 60 Fitch A- F1 Stable 50 Moody’s* A1 P-1 Stable 40 Capital Intelligence A+ A1 Stable Gove overnment of of Sa Saudi A Arabia 30 S&P A- Stable 20 Fitch A Stable 10 Moody’s A1 Stable 0 Nov-14 May-15 Nov-15 May-16 Nov-16 May-17 Nov-17 May-18 Nov-18 May-19 Capital Intelligence A+ Stable Trading commenced 12/11/2014. Day 1 at SAR 33 *Moody’s rating is unsolicited 7 NCB Investor Relations | 3Q 2019 Investor Presentation
NCB is the leading banking group in ⎮ NCB has a strong market and financial position Saudi Arabia Mark arket P t Positi tion by by KSA KS Fin inancia ial P Posit itio ion KS KSA GCC CC Overall banking Assets #1 Assets #1 #4 Corporate banking Financing #1 Financing #1 #4 Retail banking Financing #2 Deposits #1 #3 Treasury Investments #1 Investments #1 #1 Asset Management AUMs #1 Total Operating Income #1 #3 Brokerage Value Traded #2 Net Income #1 #3 Assets (S As (SARb ARbn) Financing ( (SARbn) De Deposits (S (SARb ARbn) 300 350 500 327 276 300 479 250 301 238 400 250 200 370 200 300 196 150 161 158 177 270 168 150 246 236 124 200 100 100 100 50 50 0 0 0 NCB Rajhi SABB Riyad Samba NCB Rajhi Riyad SABB BSF NCB Rajhi SABB Riyad Samba Figures and Ranks as of 2Q 2019, GCC ranks as of FY 2018 8 NCB Investor Relations | 3Q 2019 Investor Presentation
Grow with KSA Grow with NCB 3Q 2019 Results
Record Saudi Budget in 2019 ⎮ Fiscal expansionary policy to underpin economic growth Oil P l Prod oduc uction on Gover ernmen ent R Rev even enue e (SARbn) Gover ernmen ent E Expen enditure ( e (SARbn) 1,044 44 25 1,200 1,110 1,106 06 975 5 1,0 ,079 79 140.0 89 895 5 978 8 131 1,200 930 930 1,000 97.2 97 .2 20 120.0 830 30 313 692 692 1,000 288 61 616 6 800 100.0 740 519 51 15 10.5 0.5 800 10.2 0.2 10.3 0.3 10.0 0.0 10.0 0.0 860 9.7 9.7 874 256 714 80.0 169 600 722 913 600 186 696 10 60.0 70.1 0.1 662 400 607 65 65.0 .0 400 40.0 446 436 52 52.4 50.2 0.2 334 5 370 200 264 246 40.9 0.9 200 208 205 20.0 134 0 0.0 0 0 2014 2015 2016 2017 2018 2019F 2014 2015 2016 2017 2018 2019F 2014 2015 2016 2017 2018 2019F Oil Production Capex Oil Revenues Current Expenditure (Opex) Average Oil Price (USD) Non-oil Revenues Fiscal al B Bal alan ance Gover ernmen ent D Deb ebt (SARbn) Forei eign R Res eser erves es ( (USDbn) 21.7% 21 -3.5 3.5% -4. 4.2% 768 8 -5. 5.9% 19.0 9.0% 400 900 2.9% -9.2 9.2% 5.8% -12. 17. 7.2% 22.0% -15. 1,000 670 67 0 0.0% 300 43 800 13.1 3.1% 200 568 56 8 678 78 17.0% 700 60 52 529 524 4 800 -20.0% 50 502 100 560 56 39 600 12.0% 39 34 28 0 5. 5.8% 443 443 296 600 500 -40.0% (100) 725 317 31 255 7.0% 1.6 .6% 400 610 (200) 184 -100 00 -60.0% 400 529 -131 31 490 490 70 300 474 2.0% 142 42 (300) -174 74 382 -238 38 200 44 44 305 (400) 260 -80.0% 200 247 -31 311 -3.0% 142 100 (500) -389 89 (600) -100.0% 0 0 -8.0% 2014 2015 2016 2017 2018 2019F 2014 2015 2016 2017 2018 2019F 2014 2015 2016 2017 2018 2019F Domestic Fiscal Balance SAMA International Fiscal Balance as % of GDP Banks Debt to GDP Ratio (%) Source: Thomson Reuters, Ministry of Finance, SAMA, Tadawul, and NCB Economics Forecasts 10 NCB Investor Relations | 3Q 2019 Investor Presentation
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