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Stanbic IBTC Presentation / page 1 /
Stanbic IBTC Holdings PLCH1 2019 Financial Results Presentation
August 2019
Stanbic IBTC Presentation / page 2 /
1 2 3 4 5
Background and the
operating environment
Financial review: H1 2019
Business unit results
Outlook & Guidance for
2019
Appendix
Slide 3 Slide 7 Slide 21 Slide 36 Slide 40
Table of Content
Background and the operating environment
Stanbic IBTC Presentation / page 4 /
We measure our progress using five strategic value drivers
Mission
Vision
Committed to solutions that drive your progress.
To be the leading end-to-end financial solutions provider in Nigeria through innovativeand customer focused people.
In executing our group strategy our key focus areas are
Digitisation
Integration
Client centricity Do valuable things for clients
Digitise front to back
Seamlessly deliver relevant,
holistic solutions
SEE = Social, economic and environmental
Strategic focus is unchanged
Stanbic IBTC Presentation / page 5 /
Stanbic IBTC: Nigeria’s leading financial services group
AAA(nga)
B/stable/B(Bank)
AA(ng)(Bank)
2.46 million Banking
Customers
9,710 POS
176 Branches
24 BNAs&
653 ATMs
N3.48trnAuM
1.71 million RSAs
N6.96trnAuC
2,834 employees
1,206 (43%)
1,628 (57%)12 Mutual
funds
No. 1 FX Liquidity Provider
i-Support Fund,Together4aLimb
andEducational,
Health & economic empowerment
CSI Projects
Launched Digital Lending
EZ Cash
Best Investment
Bank 2018
Employee Net Promoter Score
of +46&
Emotional Promoter Score of +79
Stanbic IBTC Presentation / page 6 /
Reserves, Brent Crude Oil Price & Crude Oil Production
Inflation (%)
Interest Rates
Exchange Rate Movement
❖The external reserves grew steadily reaching $45billion in June 2019 from $43 billion at the end of2018 following the massive inflows of USD liquiditypost the elections. However, we have seen somepressure in recent times though largely subdued bysustained FX intervention by the Central Bank ofNigeria (“CBN”).
❖Brent crude oil prices averaged $66/bbl in H1 2019;lower than the $71/bbl average recorded during thesame period last year. Oil production has seen someglitches in H1 2019 and more so with the OPEC cutsthat took effect in December 2018.
❖Yields came off considerably around the secondquarter partly due to increased demand andreduction in OMO auctions from the CBN.
❖Headline inflation was mostly sticky in H1 2019(averaging 11.32%) owing to elevated food inflation.Inflation declined to 11.08% y/y in July 2019 from11.44% y/y in December 2018.
❖The USD/NGN rate saw some degree of appreciationin H1 2019 to around N361 levels from N364 inDecember 2018. The significant portfolio flowsrecorded during the period supported the exchangerate stability.
❖The Equity market remained bearish, declining by4.9% in H1 2019 amid the discouraging macro-economic backdrop.
Source: IMF/NBS/CBN/BMI
Macro-economic and operating environment
0%
5%
10%
15%
20%
25%
30%
Average inter-bank call rate Tbills - short term
Tbills - medium term Tbills - long term
Bond - 3 year
280
290
300
310
320
330
340
350
360
370
380N
GN
/ U
SD r
ate
CBN Parallel market NAFEX I&E FX Window
1.55
1.6
1.65
1.7
1.75
1.8
1.85
-
20
40
60
80
100
Jul-
18
Au
g-1
8
Sep
-18
Oct
-18
No
v-1
8
Dec
-18
Jan
-19
Feb
-19
Mar
-19
Ap
r-1
9
May
-19
Jun
-19
Jul-
19
Reserves (US$ billions)Brent Crude oil (US$).Month end priceCrude oil production (million bpd)
11.14
11.23 11.28
11.26
11.28
11.4411.37
11.31
11.25
11.3711.40
11.22
11.08
BLUE DIVIDERFinancial review: H1 2019
Stanbic IBTC Presentation / page 8 /
51.9
53.2
H1 2018
H1 2019
%
43.3
28.5
H1 2018
H1 2019
%
Summary of H1 2019 Performance – Income Statement items
Gross Earnings
H1 2019: N117.4bnH1 2018: N114.2bn
Basic Earnings Per Share
H1 2019: 342KoboH1 2018: 416Kobo
Profit After Tax
H1 2019: N36.2bnH1 2018: N43.1bn
Credit Loss RatioCost to IncomeROE
+3% -18% -16%
-2.6
-0.2
H1 2018
H1 2019
%
Stanbic IBTC Presentation / page 9 /
56.8
68.9
FY 2018
H1 2019
%
Summary of H1 2019 Performance – Financial Position items
Customer Deposits
H1 2019: N693.5bnFY 2018: N807.7bn
Net Customer Loans & Advances
H1 2019: N455.1bnFY 2018: N432.7bn
CASA Ratio Gross NPL Ratio (IFRS)ROA
-3% -14% +5%
Total Asset
H1 2019: N1.619trnFY 2018: N1.664trn
4.8
4.5
FY 2018
H1 2019
% %
3.86
3.91
FY 2018
H1 2019
Stanbic IBTC Presentation / page 10 /
59,924
19,755
53,828
5,50848,775
50,7307,646
43,084
Interest income Interest expense Non-interestrevenue
Credit impairmentcharges
Operatingexpenses
Profit beforetaxation
Taxes Profit aftertaxation
H1 2018
Overview of income statement for H1 2019 vs H1 2018
60,784
21,474
54,852
557
50,069
44,650 8,40536,245
Interest income Interest expense Non-interestrevenue
Credit impairmentcharges
Operating expenses Profit beforetaxation
Taxes Profit after taxation
H1 2019
Stanbic IBTC Presentation / page 11 /
Net Interest Income
❖ Net interest income was down by 2% to N39.3 billion (H1 2018: N40.2billion) though interest income was up by 1% to N60.8 billion (H12018: N59.9 billion) but the 9% growth in interest expense led to theNII decline.
❖ Consequently, net interest margin declined as a result of liquiditysqueeze and reduced financial investment portfolio due to increasedexcess Cash Reserve asset.
❖ Cost of funds rose due to increased funding to finance our assetsbook. We will continue to take deliberate actions to replace expensiveterm deposit with cheaper deposit liabilities.
Interest Expense
Interest Income
19,583 13,864 15,693 19,755 21,474
H1 2015 H1 2016 H1 2017 H1 2018 H1 2019
22,135 22,849 41,035 40,169 39,310
H1 2015 H1 2016 H1 2017 H1 2018 H1 2019
Net Interest Income
41,718 36,713 56,728 59,924 60,784
H1 2015 H1 2016 H1 2017 H1 2018 H1 2019
Drivers of net interest income (%)
16.2 16.6 15.8
12.0 12.8
4.0 4.3 4.0 3.7 5.2
7.2 6.9 5.9
5.2 4.9
H1 2017 FY 2017 H1 2018 FY 2018 H1 2019
Asset Yield Cost of fund NIMs
Stanbic IBTC Presentation / page 12 /
Non-Interest Revenue
❖ Non-interest revenue grew by 2% drivenby a 10% increase in trading income and10% growth in other revenue, whichcontained the impact of 2% year on yeardecline in net fees and commission.
❖ Electronic banking fees were up 71%year-on-year.
Break-down of fees and commission income
26,346 34,218 40,289 53,828 54,852
0.85
1.04 1.05
1.10 1.10
0.70
0.75
0.80
0.85
0.90
0.95
1.00
1.05
1.10
1.15
-
10,000
20,000
30,000
40,000
50,000
60,000
H1 2015 H1 2016 H1 2017 H1 2018 H1 2019
Non-interest revenue NIR to OPEX ratio
Break down of non-interest revenue by type
H1 2015 H1 2016 H1 2017 H1 2018 H1 2019
2% 1% 1% 2% 2%
27%19%
30% 30% 31%
71%80%
69% 68% 67%
Other revenue Trading revenue Net Fees and commission income
1,975 1,811 4,980
20,177
1,890 1,505 3,415
1,270 684 1,815 1,623 4,129 21,151 2,088 880 3,510 1,170 776
Accounttransaction fees
Card basedcommission
Brokerage andfinancial
advisory fees
Assetmanagement
fees
Custody fees Electronicbanking fees
Foreigncurrency service
fees
Documentationand
administrationfees
Others
H1 2019 H1 2018
Stanbic IBTC Presentation / page 13 /
Income statement - credit impairment
❖Credit impairment charges were a write back of N557mn compared to N5.51bn in the previous period as we continue to explore our recoveryefforts and strategy.
❖Credit loss ratio was (0.2%) compared to (2.6%) in H1 2018.
(7,889) (8,450) (13,953)
5,508 557 3.8
4.3
7.3
(2.6)
(0.2)
(4.0)
(2.0)
0.0
2.0
4.0
6.0
8.0
(15,000)
(10,000)
(5,000)
-
5,000
10,000
H1 2015 H1 2016 H1 2017 H1 2018 H1 2019
Credit Impairment charge Credit loss ratio
N 'million %
Stanbic IBTC Presentation / page 14 /
Operating expenses and Taxation
❖Operating expenses increased by 3% year-on-year.
❖Staff cost declined by 7% year-on-year due to decline inshare-based compensation charges on the back of declinein the company’s share price.
❖Other operating expenses increased by 10% mainly as aresult of growth in information technology cost, AMCONcharges and deposit insurance premium on customerdeposits.
❖Consequently, Cost to income ratio rose to 53.2% from51.9% recorded in prior year.
❖Effective tax rate increased to 18.8% from 15.1% in H1 2018due to assessment of the Banking subsidiary to dividend taxbasis versus minimum tax basis in H1 2018.
31,045 32,935 38,202 48,775 50,069
64.0%
57.7%
47.0%
51.9% 53.2%
40%
50%
60%
70%
80%
-
10,000
20,000
30,000
40,000
50,000
60,000
H1 2015 H1 2016 H1 2017 H1 2018 H1 2019
Operating expenses Cost-to -income ratio
N 'million
(158)
4,365 5,057 7,646 8,405 (1.7%)
27.8%
17.3%15.1%
18.8%
-5%
0%
5%
10%
15%
20%
25%
30%
(2,000)
-
2,000
4,000
6,000
8,000
10,000
H1 2015 H1 2016 H1 2017 H1 2018 H1 2019
Taxation Effective tax rate
N ‘million
Stanbic IBTC Presentation / page 15 /
Total Assets
❖ Return on asset declined due to lower earnings
H1 2017 FY 2017 H1 2018 FY 2018 H1 2019
26% 30% 26% 28% 29%
11%15% 17% 15% 19%
24%23% 22% 24% 17%
29%27% 29% 26% 28%
11% 6% 6% 7% 7%
Cash & loans to banks Trading, Pledged & derivative assets
Financial investments Loans & advances to customers
Other assets
1,619,278
461,314
94,278218,048
267,468
455,07593,538 25,608
Total Assets Cash & loans tobanks
Trading andderivative assets
Pledged assets Financialinvestments
Loans & advancesto customers
Other assets Intangible assets,property &equipment
N ‘million
N 'million
1,274 1,386 1,373 1,664 1,619
4.3%3.8%
6.4%4.8% 4.5%
0.0%
2.0%
4.0%
6.0%
8.0%
-
200
400
600
800
1,000
1,200
1,400
1,600
1,800
H1 2017 FY 2017 H1 2018 FY 2018 H1 2019
Total Assets Return on average assets
Stanbic IBTC Presentation / page 16 /
N ’billionContribution to loans and advances by product
❖Gross loans portfolio increased by 5% year-to-date though we witnessed somematurities.
❖ Installment sales, finance leases andmortgage loans declined as a result ofmaturities and muted sales in the year.
❖ Increases in term loans and overdraftswere due to pick-up in economic activitiesand drive to grow loans in non-cyclicalsectors
H1 2019
LCY loans FCY loans Total loans N ’billion N ’billion N ’billion
Personal & Business Banking 152.6 29.5 182.05 Mortgage 5.0 - 5.0 Instalment sale & finance leases 7.25 0.79 8.04
Overdrafts 27.5 2.9 30.4
Term loans 112.9 25.7 138.6 Corporate & Investment Banking 139.6 158.1 297.6
Term loans 82.5 158.1 240.5Overdrafts 56.12 0.1 56.1Instalment sale and finance lease 0.99 - 0.99 Total loans 292.2 187.5 479.7
61% 39% 100%
FY 2018
LCY loans FCY loans Total loans
N ‘billion N ‘billion N ‘billion
139.4 40.4 179.8
5.6 - 5.6
7.9 0.8 8.7
28.8 2.9 31.6
97.2 36.8 134.0
104.3 174.9 279.1
67.6 174.9 242.5
35.5 - 35.5
1.1 - 1.1
243.7 215.3 459.0
53% 47% 100%
458,946
( 797 ) ( 791 ) 19,663 2,652
479,673
Gross loansand
advances -FY 2018
Mortgagelending
Installmentsales andfinanceleases
Overdrafts Term loans Gross loansand
advances -H1 2019
393.7 403.9 439.9 458.9 479.7 0
100
200
300
400
500
H1 2017 FY 2017 H1 2018 FY 2018 H1 2019
Gross loans and advances
Loans and Advances
50.39%
48.22%
51.75%
Jun-18 Dec-18 Jun-19
LDR (CBN view)
Stanbic IBTC Presentation / page 17 /
Loans and Advances by Sector
Agriculture8.2% Communications
1.8%Construction and
real estate9.5%
Consumer credit11.2%
Finance & Insurance
0.3%
General commerce
10.0%
Government7.1%
Manufacturing35.5%
Oil & Gas Downstream 6.7%
Oil & gas services2.3%
Oil & Gas Upstream
6.4%
Transportation1.0%Agriculture
6.5% Communications7.6%
Construction and real estate
9.1%
Consumer credit10.8%
Finance & Insurance
0.2%
General commerce
8.4%
Government5.6%
Manufacturing28.1%
Oil & Gas Downstream
10.9%
Oil & gas services4.0%
Oil & Gas Upstream
7.9%
Transportation0.8%
H1 2019 FY 2018
Stanbic IBTC Presentation / page 18 /
Balance sheet – Loan performance Non-performing loans and NPL ratio (IFRS) Non-performing loans ratio by sector (IFRS)
Non-performing loans by currency (N ’million) (IFRS)
30.9 35.3 37.7 17.7 18.8
7.8%8.6% 8.6%
3.9% 3.9%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
-
10.0
20.0
30.0
40.0
H1 2017 FY 2017 H1 2018 FY 2018 H1 2019
Non-performing loans NPL/ total loans
N ‘billion H1 2019 FY 2018
Sector% of Total
NPL NPL ratio
(%)% of Total
NPL NPL ratio
(%)
Agriculture 39.4% 23.7% 12.4% 5.9%
Construction and real estate
1.0% 0.4% 2.9% 1.2%
Consumer credit 32.0% 11.5% 44.9% 15.5%
General commerce 7.0% 3.3% 10.0% 3.8%
Government 4.7% 3.3% 9.4% 5.1%
Manufacturing 0.6% 0.1% 0.7% 0.1%
Oil & Gas services 3.3% 3.2% 5.4% 9.3%
Oil & Gas downstream 0.1% 0.0% 0.2% 0.1%
Oil & Gas upstream 0.0% 0.0% 0.0% 0.0%
Transportation 12.0% 57.2% 14.1% 54.4%
Communication 0.01% 0.00% 0.00% 0.00%
Grand Total 100.0% 3.9% 100.0% 3.9%
H1 2019% of total
NPLsFY 2018
% of total NPLs
Local currency 14,004 75% 15,037 85%
Foreign currency 4,762 25% 2,677 15%
Total NPLs 18,766 100% 17,714 100%
Loan Performance
Stanbic IBTC Presentation / page 19 /
Balance sheet – Customer deposits
Customer deposits and CASA ratio Contribution to customer deposits by product
❖Customer deposits declinedby 14% to close atN693.5billion fromN807.7billion in FY 2018 dueto release of expensive termand call deposits.
❖Term and call depositsdeclined by 37% and 42%respectively while currentand savings account balancesgrew by 3% and 10%respectively.
❖The deposit mix improved asCASA ratio grew to 68.9% asat H1 2019 from 56.8% in FY2018.
H1 2019
LCY FCY Total
N’million N’million N’million
Personal & Business Banking 295.5 177.7 473.2
Current deposits 164.3 154.2 318.5
Savings deposits 73.8 - 73.8
Call deposits 5.0 0.5 5.5
Term deposits 52.4 23.01 75.4
Corporate & Investment Banking 154.0 66.3 220.3
Current deposits 54.7 31.1 85.8
Call deposits 24.0 13.3 37.3
Term deposits 75.4 21.9 97.3
Total 449.5 244.0 693.5
65% 35% 100%
FY 2018
LCY FCY TotalN ’billion N ‘billion N ‘billion
339.6 166.1 501.7
204.3 121.5 325.8
67.3 - 67.3
5.3 0.9 6.2
62.7 39.7 102.4
171.0 131.0 306.0
38.5 26.9 65.4
37.0 30.5 67.5
95.4 77.7 173.1
510.6 297.1 807.7
63% 37% 100%
Customer Deposits
693,548 807,692
13,094 (30,906) 6,435
(102,767)
Customerdeposits FY
2018
Currentaccounts
Call deposits Savingsaccounts
Termdeposits
Customerdeposits H1
2019
632.8 753.6 767.4 807.7 693.5
60.1%
49.2%54.9%
56.8%
68.9%
40%
50%
60%
70%
0
150
300
450
600
750
900
H1 2017 FY 2017 H1 2018 FY 2018 H1 2019
N ‘billionN ‘billion
Stanbic IBTC Presentation / page 20 /
Balance sheet – Shareholder value Return on average equity
Net assets value per share and price-to-book ratio Market capitalisation
1,595 1,812 2,073 2,299 2,703
2.1 2.3
2.5
2.1
1.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
0
500
1,000
1,500
2,000
2,500
3,000
H1 2017 FY 2017 H1 2018 FY 2018 H1 2019Net asset value per share Price- to- book
kobo Times
330.0 417.1 522.6 491.0 412.2 0
100
200
300
400
500
600
H1 2017 FY 2017 H1 2018 FY 2018 H1 2019
N ’billion
31.3% 28.9%
43.3%
34.5%28.5%
H1 2017 FY 2017 H1 2018 FY 2018 H1 2019
Capital and Shareholder Value
19.2% 19.6%
23.3%21.3%
23.6%22.9% 23.5%
27.4%24.7%
27.3%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
H1 2017 FY 2017 H1 2018 FY 2018 H1 2019
Tier 1 capital adequacy Total capital adequacy Statutory minimum
Stanbic IBTC Presentation / page 21 /
Business unit results
Personal & Business Banking
(“PBB”)
Stanbic IBTC Presentation / page 23 /
94.7
93.1
H1:18
H1:19
%
PBB Performance Highlights
Cost to Income Credit Loss RatioROE
+7%
0.4
1.6
FY 18
H1:19
%
+10%
Total Income
H1:19: N26.6bnH1:18: N24.1bn
8.5
0.5
H1:18
H1:19
%
-93%Profit After Tax
H1:19: N192mnH1:18: N2.7bn
+1%
Gross loans & AdvancesH1:19: N182.0bnFY18: N179.8bn
-6%
Customer DepositsH1:19: N473.3bnFY18: N501.7bn
NPL Ratio
9.0
9.9
FY 18
H1:19
%
Stanbic IBTC Presentation / page 24 /
PBB Financial Analysis – H1 2019
Performance highlights
H1 2019 Change H1 2018
Income statement N’million % N’million
Net interest income 17,726 10 16,123
Non-interest revenue 8,851 11 7,986
Total income 26,577 10 24,109
Credit impairment charges (1,440) (>100) 1,860
Operating expenses (24,731) 8 (22,824)
Profit before tax 406 (87) 3,145
Profit after tax 192 (93) 2,653
Balance sheet H1 2019 FY 2018
Gross loans & advances 182,047 1 179,813
Deposit liabilities 473,259 (6) 501,689
Key selected ratios H1 2019 H1 2018
Cost to income ratio % 93.1 94.7
CASA ratio % 83 76
H1 2019 FY 2018
Credit loss ratio % 1.6 0.4
❖ 7% decline in interest expense is a reflection of the business’continued effort to replace expensive term deposits with lowcost deposits which led to a CASA ratio of 83% as against FY2018 of 78%. This decline coupled with 6% YoY growth ininterest income led to a 10% growth in NII.
❖ Non-interest revenue grew as transaction turnover grewyear-on-year across our banking channels.
❖ In line with our discipline, provisions were made on somedelinquent loans which led to credit impairment charges ofN1.44bn as against a write back of N1.86bn in the priorperiod.
❖ While some savings were made on staff costs YoY, operatingexpenses grew by 8% YoY as a result of AMCON charges anddeposit insurance.
❖ Loan book grew slightly as we continue to support our clientbusiness while exploring opportunities to support the varioussectors of the economy most especially the real andagricultural sectors.
❖ Deposit book declined by 6% YTD due to our deliberateefforts to replace expensive deposits with cheaper deposits toreduce our cost of funds.
Stanbic IBTC Presentation / page 25 /
29,537,523
32,304,38831,857,214
36,081,792
Q3-18 Q4-18 Q1-19 Q2-19
Digital Transaction Trend Q-o-Q
1,719,454
1,797,994
1,641,711 1,633,975
Q3-18 Q4-18 Q1-19 Q2-19
Branch Transaction Trend Q-o-Q
39,620,364
54,241,614
67,939,006
HY 2017 HY2018 HY 2019
Digital Transaction Trend HY-o-HYWith the current volume of digital transactions as at H1 2019, we arewell on course to improve the performance by full year 2019 whilesetting another higher benchmark for volume of transactions, in linewith the trend in the past 3 years.
The bank continues to drive digital transactions as customers becomemore comfortable using our alternative channels. This is reflected inthe 13% growth in Digital transactions between Q1 & Q2 2019.
Digital Channels
Stanbic IBTC Presentation / page 26 /
Digital Channels
5,551,148
6,969,093
12,520,241
6,567,026
2,330,482
- 5,000,000 10,000,000 15,000,000
Q1 2019
Q2 2019
HY 2019
HY 2018
HY 2017
USSD Banking
4,909,889
5,693,968
10,603,857
6,523,376
2,475,218
Q1 2019
Q2 2019
HY 2019
HY 2018
HY 2017
Mobile Banking
3,456,193
4,075,705
7,531,898
4,950,028
2,874,929
Q1 2019
Q2 2019
HY 2019
HY 2018
HY 2017
POS
130,867
103,759
234,626
247,009
171,095
Q1 2019
Q2 2019
HY 2019
HY 2018
HY 2017
SME Internet Banking
12,428,975
13,674,846
26,103,821
23,776,621
21,278,667
Q1 2019
Q2 2019
HY 2019
HY 2018
HY 2017
ATM
36,576
46,472
83,048
65,507
43,051
Q1 2019
Q2 2019
HY 2019
HY 2018
HY 2017
Bulk Note Acceptors (BNA)
Stanbic IBTC Presentation / page 27 /
Digital Lending (EZ Cash)We have made progress with the Instant
Cash Advance and the number of loans
disbursed has increased. This would
continue to be a major focus for the second
half of 2019.
Trade OpportunitiesThe second half of the year presents a
lot of opportunities for Trade.
Cards We aim to increase monthly revenue on
cards in H2 2019.
Virtual BankingThe launch of the Virtual
Banking 2.0 is set for Q3 2019
and would enable us increase
scale and ramp up customer
acquisition.
Cards
Trade
Opportunities
Virtual Banking
Digital Lending
(EZ Cash)
Opportunities for 2nd Half 2019PBB– Moving forward 2019
We remain committed to our Africa China Banking proposition
Corporate & Investment Banking (CIB)
Stanbic IBTC Presentation / page 29 /
41.8
41.4
H1:18
H1:19
%
CIB Performance Highlights
Cost to Income Credit Loss RatioROE
+7%
-1.3
-1.3
FY18
H1:19
%
-5%
Total Income
H1:19 : N43.3bnH1:18 : N45.5bn
57.5
38.1
H1:18
H1:19
%
-15%
Profit After Tax
H1:19 : N24.0bnH1:18 : N28.3bn
+7%
Gross loans & AdvancesH1:19: N297.6bnFY18: N279.1bn
-28%
Customer DepositsH1:19 : N220.3bnFY18: N306.0bn
NPL Ratio
0.6
0.3
FY18
H1:19
%
Stanbic IBTC Presentation / page 30 /
CIB Financial Analysis – H1 2019
Performance highlights
H1 2019 Change H1 2018
Income statement N ’million % N ’million
Net interest income 18,151 (15) 21,282
Non-interest revenue 25,148 4 24,218
Total income 43,299 (5) 45,500
Credit impairment charges 1,962 (46) 3,628
Operating expenses (17,905) (6) (19,012)
Profit before tax 27,356 (9) 30,116
Profit after tax 23,969 (15) 28,322
Balance sheet H1 2019 FY 2018
Gross loans & advances 297,626 7 279,133
Deposit liabilities 220,289 (28) 306,003
Key selected ratios H1 2019 H1 2018
CASA ratio % 39 20
❖We witnessed good performance from our capitalmarkets, advisory, FX trading and trade financebusinesses in the first half of the year, despite theeffect of electioneering on business activities.
❖ Credit impairment charges were a write back justlike the previous year but the recovered sum waslower.
❖ Cost-to-income ratio moderated down to 41.4%from 41.8% in H1 2018.
❖ Loan book growth was driven by opportunities inoverdrafts.
❖ Deposit book declined due to our drive to curtailcost of fund by releasing expensive term deposits.
Stanbic IBTC Presentation / page 31 /
Growing deposits with focus on transactional low cost deposits. Relentless focus on lowering cost of funding.
Growing quality loans and advances with focus on the more resilient sectors of the economy.
Focus on winning mandates in our capital markets businesses.
Growing our Trade Finance market share.
Growing market share in our foreign currency trading business.
CIB– Moving forward 2019
1
4
2
3
5
Develop structured products in the Global Markets space to target foreign Fixed Income sector clients.6
WealthWealth
Stanbic IBTC Presentation / page 33 /
28.5
30.6
H1:18
H1:19
%
Wealth Performance Highlights
Cost to IncomeROE
+7%flat
Total Income
H1:19: N24.3bn
H1:18: N24.4bn
77.8
54.4
H1:18
H1:19
%
flat
Profit After Tax
H1:19: N12.1bn
H1:18: N12.1bn
+8%
Assets under
Management
H1:19: N3.48trn
FY18: N3.22trn
+1%
No. of RSAs
H1:19: 1.708mn
FY18: 1.695mn
Stanbic IBTC Presentation / page 34 /
Wealth Financial Analysis – H1 2019
Performance highlights
H1 2019 Change H1 2018
Income statement N ’million % N ’million
Net interest income 3,433 24 2,764
Non-interest revenue 20,853 (4) 21,624
Total income 24,286 - 24,388
Credit impairment charges 35 75 20
Operating expenses (7,433) 7 (6,939)
Profit before tax 16,888 (3) 17,469
Profit after tax 12,084 - 12,109
H1 2019 FY 2018
Assets under Management (N ’million) 3,478,845 8 3,221,574
Retirement Savings Accounts (number) 1,708,902 1 1,695,861
Key selected ratios H1 2019 H1 2018Cost to income ratio % 30.6 28.5
❖Net interest income grew by 24% as the business continuesto invest its capital in financial and investment securities.
❖Non-interest revenue declined by 4% due to the impact ofregulatory fee reduction.
❖Operating expenses grew by 7%, driven by increased pensionprotection levy and marketing expenses.
❖Cost-to-income ratio deteriorated year-on-year but thebusiness will continue to strive for better efficiencies.
Stanbic IBTC Presentation / page 35 /
Wealth – Moving forward 2019
Social, Economic and Environment (SEE) 1We will continue to make long term investments that willpreserve the environment and create sustainable impacton our society. We will also continue to engage investeecompanies on Environmental, Social and Governance(ESG) considerations.
Micro Pension 3
We will continue to create awareness ,and sensitizeprospective clients in the informal sector on theimportance of saving towards retirement. We will alsoalign all our onboarding channels with the EnhancedContributor Registration System (ECRS)..
Digitization4We will continue to focus on our digitization initiatives such asupgrading of core applications, comprehensive revamp of themutual fund on-boarding and top-up processes as well as rollout of the Invest Beta solution.
2 Collaboration
We will continue to leverage on the Stanbic IBTC’secosystem to create unique value proposition forclients.
Employee Engagement 5
We will focus on improving employee net promoter scoreas well as continue to build a digitally savvy talent pool.
Outlook & Guidance for 2019
Stanbic IBTC Presentation / page 37 /
Outlook for H2 2019
Banking Industry 2✓ Interest rates remain around 12% - 14% ✓ Stable foreign exchange rate✓ Heightened regulation in a bid to drive loan growth✓ Pressured NIMs✓ Relatively tight liquidity regime✓ Improved digital efficiency✓ Improvement in asset quality but risks still lingers
Stanbic IBTC3Areas of focus for 2019 financial year:✓ Cost efficiency✓ Improving risk asset quality✓ Loan growth✓ Growing low-cost deposits✓ Client service and improving customer experience✓ Digitization
Key risks to our results are:✓ Low-cost deposit growth✓ Competitive asset pricing✓ Regulatory interventions
Nigeria’s Economic & Political environment1✓ Moderate economic growth✓ Stable oil production levels and relative peace in the
Niger Delta Region✓ Stable oil price around the $60/bbl levels✓ Fairly contentious political environment✓ Average headline inflation of 11%✓ Accretion to external reserves
Stanbic IBTC Presentation / page 38 /
2019 Guidance Vs H1 2019 Actual
2018 Actual H1 2019 Actual 2019 Guidance
19%AuM Growth 8% 15% - 20%
34.5%Return on Equity 28.5% 25% - 30% *
52.9%Cost to Income 53.2% 50% - 55%
5.2%Net Interest Margin 4.9% 4.0% - 5.0% *
(0.7%)Cost of Risk (0.2%) <3.0%
57%CASA Ratio 68.9% 55% - 60%
3.9%NPL Ratio <5%
7%Deposit Growth (14%) (10%) – (15%) *
16%Loan Growth 5% 10% - 15%
* Revised
3.91%
Stanbic IBTC Presentation / page 39 /
Questions
Stanbic IBTC Presentation / page 40 /
Appendix
Stanbic IBTC Presentation / page 41 /
1989 2001 2005 2007 2012
Incorporated as Investment Banking & Trust Company Limited and commenced operations as a Merchant bank.
Obtained Universal Banking Licence in Nigeria.
Listed on The NSE on 25 April 2005.
Merged with Chartered Bank & Regent Bank and changed name to IBTC Chartered Bank PLC.
Merged with Stanbic Nigeria and Standard Bank gained control of the combined entity in a US$1bn transaction.
Holding Company Structure was adopted.
Stanbic IBTC Trustees Ltd
Stanbic IBTC Nominees Ltd
Stanbic IBTCVentures Ltd
Stanbic IBTC Bureau De Change Ltd
99.9%
Stanbic IBTCBank PLC
99.9%
Stanbic IBTC Holdings PLC
88.24%99.9%99.9% 99.9% 99.9%
99.9% 99.9%99.9%
Stanbic IBTC Pension Managers Ltd
Stanbic IBTC Investments Ltd
Stanbic IBTC Asset Management Ltd
Stanbic IBTC Capital Ltd
Stanbic IBTC Stockbrokers Ltd
About Stanbic IBTC Holdings PLC
Stanbic IBTC Insurance Brokers Limited
75%
2018
Standard Bank increased its stake in Stanbic IBTC to 65.35% in May 2018.
About Stanbic IBTC Holdings PLC
Stanbic IBTC Presentation / page 42 /
Group income statement
Group income statement
Change%
H1 2019Nmillion
H1 2018Nmillion
Gross earnings 3 117,374 114,207
Net interest income (2) 39,310 40,169 Interest income 1 60,784 59,924 Interest expense 9 (21,474) (19,755)
Non-interest revenue 2 54,852 53,828 Net fees and commission revenue (2) 35,969 36,687
Fees and commission revenue 2 37,707 37,142 Fees and commission expense >100 (1,738) (455)
Trading revenue 10 17,603 15,976 Other revenue 10 1,280 1,165
Total income 94,162 93,997 Credit impairment charges (90) 557 5,508
Income after credit impairment charges (5) 94,719 99,505 Operating expenses 3 (50,069) (48,775)Staff costs (7) (19,885) (21,333)Other operating expenses 10 (30,184) (27,442)
Profit before taxation (12) 44,650 50,730 Direct taxation 10 (8,405) (7,646)Profit for the period (16) 36,245 43,084
Stanbic IBTC Presentation / page 43 /
Group quarterly income statement
Group quarterly income statement
QoQ Group Group Group Change Q2 2019 Q1 2019 H1 2019
% N’million N’million N’million Gross income 58,681 58,693 117,374 Net interest income (5) 19,125 20,185 39,310
Interest income (5) 29,642 31,142 60,784 Interest expense (4) (10,517) (10,957) (21,474)
Non-interest revenue 3 27,848 27,004 54,852 Net fee and commission revenue 14 19,178 16,791 35,969
Fee and commission revenue 17 20,369 17,338 37,707 Fee and commission expense >100 (1,191) (547) (1,738)
Trading revenue (20) 7,805 9,798 17,603 Other revenue >100 865 415 1,280
Total income (0.5) 46,973 47,189 94,162 Credit impairment charges (>100) (834) 1,391 557 Income after credit impairment charges (5) 46,139 48,580 94,719 Operating expenses (0.3) (24,998) (25,071) (50,069)
Staff costs 17 (10,715) (9,170) (19,885)Other operating expenses (10) (14,283) (15,901) (30,184)
Profit before taxation (10) 21,141 23,509 44,650 Taxation 7 (4,046) (4,359) (8,405)Profit for the period (11) 17,095 19,150 36,245
Stanbic IBTC Presentation / page 44 /
Group statement of financial position
YTD Change%
H1 2019N ‘million
FY 2018N ‘million
Assets
Cash and cash equivalents (2) 445,491 455,773
Pledged assets 53 218,048 142,543
Trading assets (14) 72,446 84,351
Derivative assets (28) 21,832 30,286
Financial investments (33) 267,468 400,000
Loans and advances 7 470,898 441,261
Loans and advances to banks 85 15,823 8,548
Loans and advances to customers 5 455,075 432,713
Other assets 9 84,819 77,787
Investments in subsidiaries - -
Property and equipment 18 25,608 21,652
Intangible assets (1) 819 827
Right of Use Asset 3,130 -
Deferred tax assets (5) 8,719 9,181
Total assets (3) 1,619,278 1,663,661
Equity and liabilitiesEquity 10 264,404 239,667 Equity attributable to ordinary shareholders
10 259,669 235,406
Ordinary share capital - 5,120 5,120 Ordinary share premium - 76,030 76,030 Reserves 16 178,519 154,256 Non-controlling interest 10 4,735 4,261
Liabilities (5) 1,354,874 1,423,994 Trading liabilities 18 148,466 125,684 Derivative liabilities (38) 2,593 4,152 Current tax liabilities 15 17,141 14,899 Deposit and current accounts (15) 822,480 967,964
Deposits from banks (20) 128,932 160,272 Deposits from customers (14) 693,548 807,692
Other borrowings >100 142,587 69,918 Debt securities issued 0 60,615 60,595 Provisions (4) 12,931 13,452 Other liabilities (11) 148,061 167,193 Deferred tax liabilities - 137
Total equity and liabilities (3) 1,619,278 1,663,661
YTD Change%
H1 2019N ‘million
FY 2018N ‘million
Stanbic IBTC Presentation / page 45 /
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