fy2016 results, investor presentation - ambank · fy2016 results, investor presentation part a...
TRANSCRIPT
27 May 2016
FY2016 Results,
Investor Presentation
PART A – FY2016 Results, Investor Presentation (Page 2 – 19)
PART B – Additional Information (Page 21 – 43)
PART C – AmBank Group Strategic Growth Plan (Page 45 – 62)
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Performance indicators FY16
RM’ mil FY15Underlying3
FY16Reported
FY16 Underlying¹
YoY Growth (Underlying)3
Total income 4,262.8 3,695.8 3,695.8 13.3%
Expenses 2,068.1 2,174.3 2,120.6 2.5%
Allowances -97.7 -209.5 -209.5 >100%
PATMI 1,639.1 1,302.2 1,355.9 17.3% 1,300
ROE 11.8% 8.8% 9.1% 2.7% Circa ~ 9.0%
CTI 48.5% 58.8% 57.4% 8.9% ≤ 58%
Gross impaired loans ratio
1.94% ≤ 2%
Dividend15.5 sen
(36% payout)40 – 45% payout
Other details:
CASA composition 20.7%
Capital ratios2
- CET 1- Tier 1- Total
11.2%12.2%16.1%
Note:1. Excluding regulatory penalty incurred in Q3FY162. Based on Aggregated Banking Entities and after proposed dividend3. FY2015 underlying – adjusted by divestment gain and related expenses from disposal of AmLife and AmFamily Takaful
2
FY16Guidance
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
FY2016 results….
• Underlying PATMI lower at RM1,355.9 mil, top line growth impacted by cautious businesssentiment, NIM compression and changes in consumer spending patterns
• NIM stood at 2.02%. NIM compression (-41bps) reflects portfolio rebalancing and currentfunding composition
• NoII decreased 11.7% mainly due to weaker credit card fees, lower loans and advisoryfees from wholesale banking and decline in net insurance premium
• Reaping benefits from enhanced asset quality, lower allowances, partially alleviatedimpact from narrowing NIM
• Despite successful cost management efforts, slower income growth & increasedregulatory/compliance expenses have weighed on efficiency with CTI @ 57.4%
• Group GIL ratio at 1.94%, reflects sector stress experienced by the wholesale segment,despite consistent improvement in retail impaired loans. LLC decreased to 99.4% (excluding
single large and well-secured impaired corporate loan)
• Robust mortgage loans growth of 12.7% and higher loans extended to SME sector, albeit
muted overall loans growth
• CASA ratio at 20.7% though deposits contracted 1.9% amid intense competition for retail
deposits. Sound liquidity with LCR above 100%
• CET1 ratio of 11.2% and dividend payout ratio of 36%
3
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Conventional PATMI Islamic PATMI Positive growth in FY16 Contraction in FY16
1,918.6
4
FY2016, Profit drops from lower income despite higher recoveries and flat expense growth
1,302.2
RM’ mil FY16 FY15
Net Interest Income
2,378.8 2,770.3
Non-InterestIncome
1,317.0 1,954.4
Total Income
3,695.8 4,724.6
Expenses 2,174.3 2,157.9
PBP 1,521.5 2,566.8
Provision/ Allowances
(209.5) (37.5)
PBT 1,731.0 2,604.3
Tax & Zakat 331.5 559.7
PAT 1,399.5 2,044.6
MI 97.3 125.9
PATMI 1,302.2 1,918.6
13%87%
18%82%
YoY growth(%)
1
14
33
22
41
34
41
>100
32
23
32
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
1,639.1
1,302.2
1,782.4
FY14 FY15 FY16
Underlying Reported YoY growth (reported): 32% YoY growth (underlying): 17%
Diversified PATMI contribution with 10% growth from Retail
5
Retail Banking
36%
Wholesale
Banking63%
Insurance6%
Operating-5%
Reported
1,918.6
1,355.9
17%
10%
41% >100%
• Net profit from retail banking higher underpinned by better asset quality
• Wholesale banking’s contribution lower in line with muted top line growth and lower recoveries year-on-year
• Insurance profit declined on the back of conservative investment strategy and higher claims, although gross premium sustained
PATMI (RM’mil) and divisional contribution
For further details on divisional performance, refer to slides 24-33
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
3,695.8
4,262.8
4,724.6
14.1
38.7
15.2
44.7
14.1
48.7
391.5
461.8
FY16 reported
Others*
Net insurance premium
Markets sales & trading
WB loans, IB Advisory &Underwriting fees
Funds management & Brokerage
Credit card & merchant fees
Net interest
FY15 underlying
Divestment gain
FY15 reported
6
RM’ milYoY growth
(%)Composition
(%)
64
2
5
5
3
10
10
14
37
7
19
11
9
• Margin compression from portfolio rebalancing and higher funding costs
Non-interest income:FY15* – RM1,493m / 35.0%FY16 – RM1,317m / 35.6%* Underlying
• Fees from acquiring business impacted by lower acquisition volumes and competition. Issuing related fees (largely annual fees) decreased due to lower cards-in-circulation
• AUM growth dampened by weaker market performance and redemptions. Brokerage income down on lower retail volume
• Subdued capital market activities coupled with cautious business sentiment has driven WB fee income lower
• Lower trading income from Markets due to lack of new debt issuances and heightened rate volatility
• Insurance income declined primarily due to disposal of life insurance business and higher claims expense from general insurance business
Income drivers – NIM compression persists and NII impacted by cautious sentiments & lower fees
Total Income
Total Income
* Include investment income from General Insurance business
2,378.8
82.5
178.0
186.6
122.8
379.3
367.8
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Other Retail
9%
Cards
10%
Wealth
Management1%
Investment
Banking19%
Markets
9%Fund Management
10%
Corp & Comm
Banking6%
Insurance27%
Others9%
Non-interest income declined across the board
7
701.5 713.4 785.7
721.4
587.0
614.1
342.0 249.1
268.1
269.7
461.8
117.0
250.2
471.9
418.0
379.3
14.2
44.2
97.9
84.9
81.0
FY12 FY13 FY14 FY15 FY16
Fee Trading & Investment One-off Insurance Others
1,446.8
1,349.8
1,604.7
1,954.4
1,317.0
78%
23%
11%
13% 4%
44%
20%
RB20%
WB44%
Insurance & Others
36%
22%
32%
Non-interest income (RM’mil)
YoY growth: 11.7% (underlying)YoY growth: 32.5% (reported)
Non-interest income by lines of business
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
4.99%
5.34%
5.60%
5.35%
5.13%
4.88%4.75%
4.56% 4.63% 4.57%
3.03% 3.06% 3.07% 3.27%3.35%
2.69% 2.90% 3.08% 3.17%3.34%
2.51%2.66%
2.75%
2.43%
2.02%
FY12 FY13 FY14 FY15 FY16
8
Gross yield coming off whilst funding cost escalated,reflecting industry trend
Gross Yield
Industry Avg.Lending Rate*
Avg 1M KLIBOR*
COF
NIM
Note:* Source: BNM Monthly Statistics
FY15: 2.43%FY16: 2.02%
Quarterly net interest income and NIM movementNIM YoY trend vs. industry
696723
682 669
617 616
581565
2.45%2.54%
2.38%2.33% 2.13%
2.12%
1.94% 1.92%
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
202
202
205
209
212
213
218
221
228
237
237
243
3
4
3
1
5
3
7
9
6
FY16 Reported
Others
Deposits
Wholesale / Retail Mix
Equity
Corp Loans
Cards
Mortgage
Auto
FY15 Underlying
One-off
FY15 reported
9
NIM compression more than industry reflecting portfolio rebalancing and funding composition
• Auto & mortgage – margins lower from rebalanced portfolio with better risk profile
• Cards – impacted by attrition and lower average spending by card holders
• Equity – margin financing impacted by lower retail volume
• Deposits – low CASA and higher wholesale term deposits
• Corp loans – yield lower from competing in the large corporates and MNCs segment
• One-offs – adjustments to PER and EIR in FY15
bps
• Wholesale / retail mix – increased composition of wholesale loans with lower yield
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Allowances lower, retail asset quality continued to strengthen
10
Allowances (RM’ mil)
Credit costs vs. industry1
• Allowances lower through reduction in collective impairment made predominantly due to better loss experience for retail portfolio
• Marked improvement in retail GIL ratio offset by new impairment from large and well-secured corporate loans
• Credit costs consistently tracking below industry average since FY14, as we benefit from portfolio rebalancing initiatives
1. An average of eight peer domestic banks2. Latest industry data available as at Dec-15 only
AmBank Group FY12 FY13 FY14 FY15 FY16
Credit cost 0.50% 0.21% 0.08% -0.04% -0.19%
Credit cost (excluding recoveries)
1.18% 0.90% 0.94% 0.69% 0.46%
FY15 IndividualAllowance
Collective Allowance
Recoveries Others FY16
Gross impaired loans ratios
Adjusted Group GIL ratio at 1.55%
(excluding one large and well-secured corporate loan)
-0.50%
0.00%
0.50%
1.00%
Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16
AmBank
Industry²
2.51% 2.43%2.17%
2.01%
1.95%
1.91%1.74%
1.68%
1.08% 0.98%
1.53%1.55% 1.63%
2.00%
1.86% 2.22%
1.87% 1.79%
1.88% 1.79%1.80% 1.95%
1.80%1.94%
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
Retail Wholesale Group
(30.5)
(164.1)
47.7 59.5
240.5
0.2
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Real estate34%
Residential Properties
19%
Transport Vehicles
16%
Manufacturing11%
Mining and quarrying
5%
Others15%
Asset quality, adequate coverage
11
Loan loss coverage vs. industry
Impaired loans by sectors and YoY movement
• Loan loss coverage declined as impairment charges are mitigated through collaterals
• More than 50% of impaired loans are made up of real-estate and residential properties, which are generally well-secured
• Exposures to O&G sector are closely monitored, although majority of the exposures (circa 90%) are internally assessed as moderate risks or better
* Adjusted AmBank Group LLC excludes single large and well-secured impaired corporate loan
Exposures to oil & gas sector by internal risk grades
43.5%
9.4%
26.8%
10.6%
11.7%
95.6%
102.2%104.5%
98.8%Industry 94.3%
114.6%
129.3%
104.9%
AmBank Group
81.1%
127.4%
131.5%
Adjusted AmBank
Group99.4%
FY12 FY13 FY14 FY15 FY16
Strong ~ Very
Strong68%
Satisfactory ~
Moderate21%
Marginal ~ Substandard
8%
Impaired3%
Total loans to O&G sector:
Approximately 4% of total gross loans
>100%
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
1,906.2
1,680.5 1,662.11,572.7
1,700.9
2.45%
1.98%1.86% 1.79%
1.94%
FY12 FY13 FY14 FY15 FY16
Gross Impaired Loans GIL Ratio
Asset quality remains sound with proactive collection activities
12
Provision charges/(writebacks) (RM’ mil)
Collective allowance balance (RM’ mil) Impaired loans – key segments (RM’ mil)
Impaired loans (RM’ mil)
288.3
638.8
214.8
271.5
202.6
438.5
166.7
253.9
Defaulted assets Non-defaultedassets
Model riskadjustment
Macro adjustment
FY15 FY16 FY15 Total: RM1,413.4 milFY16 Total: RM1,061.7 mil
323.7 287.7 216.791.3 138.9
569.9455.2 602.5
504.6264.1
-507.9 -566.1-748.5
-624.4 -565.0
-3.7-3.9
-3.0-2.0 -2.2
381.9 172.9 67.8 -30.5 -164.1
FY12 FY13 FY14 FY15 FY16
Individual Collective Recoveries Others Total
621.9
541.4
304.4
391.0 409.3
642.7
281.4
373.5
924.7
Auto finance Mortgage Wholesale Banking
FY14 FY15 FY16
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
87.9
87.8
2.4
0.3
0.7
0.2
1.6
0.3
FY16
Others
Cards
Auto finance
Mortgage
Investmentbanking
Corporate & SME
FY15
Mortgage loans growth outperforming industry
13
• WB (Corp & IB) - Higher loans extended to SME sector via
CGC programmes- Overall growth remained flat due to large
corporate repayments in Q1
Breakdown by rate sensitivity:Fixed rate – 34.9%
Variable rate – 65.1%
Breakdown by concept:Islamic – 31.6%Conventional – 68.4%
YoY growth(%)
Composition(%)
9
39
24
25
2
1
5
1
13
7
9
24
0.1
Breakdown by customers type:Retail – 52%Non-retail – 48%
Gross loans movement (RM’bil)
1.6
• Mortgage - Robust growth surpassed industry, focusing on relationships with key developers
• Auto – Gross loans lower from de-risking, disbursements picked up since Q2FY16
• Cards – Impacted by lower cards in circulation and new cardholders with low utilisation / billings
Exclude AF: 2.5%
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
2.5% 0.9% 6.9% 0.6% 7.4% 4.4% 7.0% 2.3% 6.9% 2.8% 57.1% 1.1%
(35.8) 13.1 100.5 9.0 106.6 64.1 100.933.6
100.741.0
828.1
16.4
1449.5
Mar-16
4.1 3.0 9.0 0.54.1 4.3
1.8 3.6 8.8 2.1
46.0
0.5
87.9
Mar-16
Source : BNM, financial statement
AgricultureMining & Quarrying
ManufacturingElectricity,
Gas & WaterConstruction
Wholesale, Retail,
Restaurant
Transport, Storage &
Com
Finance, Insurance,
& Biz Act Real Estate
Education & Health
Household Others Total Loans
YoYgrowth
Loans by sector vs. industry
14
Loans by purposeMar’15RM’ bil
YoYgrowth
Composition
Purchase of transport vehicles
22.0 -7.6% 25.1%
Working capital 26.1 +13.8% 29.7%
Purchase of resi property 18.3 +15.3% 20.8%
Purchase of non-resiproperty
7.3 -13.6% 8.3%
Other purpose 4.6 -12.4% 5.2%
Purchase of securities 2.5 -31.2% 2.9%
Construction 3.0 -7.8% 3.4%
Personal use 1.7 -0.3% 1.9%
Credit card 1.3 -14.3% 1.5%
Purchase of fixed assets 1.1 -15.3% 1.2%
Consumer durables - - -
87.9 -0.2% 100.0%
Loans by Sector
3.7% 2.6% 5.2% 59.9% 4.2% 5.7% 23.3% 7.0% 1.1% 23.2% 1.2% 7.6% 0.1%
4.7% 3.4% 10.2% 0.6% 4.7% 4.9% 2.0% 4.1% 10.0% 2.4% 52.4% 0.5%Loanscomposition
YoYgrowth
Loans by purposeMar’16RM’ bil
YoYgrowth
Composition
Purchase of transport vehicles
168.8 +0.6% 11.6%
Working capital 347.5 +8.3% 24.0%
Purchase of resi property 447.1 +11.0% 30.8%
Purchase of non-resiproperty
200.1 +8.2% 13.8%
Other purpose 61.6 -0.5% 4.2%
Purchase of securities 71.6 -7.4% 4.9%
Construction 44.1 +11.9% 3.0%
Personal use 64.0 +7.1% 4.4%
Credit card 35.0 -1.8% 2.4%
Purchase of fixed assets 9.6 -10.1% 0.7%
Consumer durables 0.1 -80.6% 0.0%
1,449.5 +6.4% 100.0%
Loanscomposition
9.8% 14.8% 0.7% 17.2 7.0% 9.6% 13.8% 1.3% 8.8% 5.1 6.4% 2.9% 6.4%
AmBank Group (RM’ bil)
Industry (RM’ bil)
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
4.8%
4.3% 4.3%4.6% 4.6%
4.2%4.4% 4.3% 4.3% 4.4% 4.3% 4.4%
Jun 13 Sep 13 Dec 13 Mar 14 Jun 14 Sep 14 Dec 14 Mar 15 Jun 15 Sep 15 Dec 15 Mar 16
Industry - CASA AmBank Grp Mkt Share
CASA sustained amidst intense competition
15
CASA market share and industry CASA balance1 (RM’ bil) Deposits by type of customers (RM’ bil)
• Deposits contracted YoY, in line with the industry’s liquidity outflows (particularly the retail segment)
• CASA sustained through cash management offerings and payroll acquisitions
18.8 17.1 18.5 18.7 18.8 18.8 18.5 18.7
68.1 68.2 71.5 73.4 71.0 70.5 72.4 71.7
21.6% 20.1% 20.5% 20.3% 20.9% 21.1% 20.4% 20.7%
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
CASA Fixed deposits CASA Composition (%)
1. Source: BNM Monthly Statistics
Deposits QoQ growth: 0.6% CASA QoQ growth: 1.1%
Deposit and CASA balance (RM’ bil)
5.2 5.3 5.5 5.2 10.7 10.5
32.0 31.042.7 41.5
8.0 8.2 8.0 8.2
41.4 40.7
49.4 48.9
5.2 5.3
13.5 13.418.7 18.7
73.4 71.7
92.1 90.4
FY15 FY16 FY15 FY16 FY15 FY16 FY15 FY16 FY15 FY16
Retail Non-Retail
Savings Current Account
Fixed Deposits
CASA CoreDeposits
Deposits YoY growth: 1.8%
CASA YoY growth: ≈
86.9 85.390.0 92.1 89.8 89.3 90.9 90.4
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
139.0
284.7423.7
561.1
984.8
16
Deposits movement better than industry
5.3 13.4 18.7
71.7
90.4
Mar'16
SavingsCurrent Account
CASA Fixed Deposits Core Deposits
AmBank Group (RM’ bil)
YoY growth
0.3% 0.1% 0.0% 2.3% 1.8%
Industry (RM’ bil)
0.2% 4.1% 2.7% 11.3% 7.8%
YoY growth
Savings 6%
Current Account
15%
Fixed Deposits
79%
Savings 14%
Current Account
29%
Fixed Deposits
57%
Core Deposits Composition (AmBank Group)
Core Deposits Composition (Industry)
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
2,157.9
2,068.1
2,017.1
2,174.3
17.8
119.5 19.9
89.8
9.2 41.8
35.0%
40.0%
45.0%
50.0%
55.0%
Ma
r-0
8
Ma
r-0
9
Ma
r-1
0
Ma
r-1
1
Ma
r-1
2
Ma
r-1
3
Ma
r-1
4
Ma
r-1
5
Remained proactive on cost management
17
Cost-to-income ratio vs. industry1Projects & investments spend in FY16 (CAPEX & OPEX) (RM’ mil)
• Slowing income growth weighed down on CTI ratio despite active cost management
• Further pressure from increased regulatory and compliance requirements
• Task force established to focus on creating leaner organization through process simplification and streamlining
1. An average of eight peer domestic banks2. Latest industry data available as at Dec-15 only
AmBank Group
Industry
Expense growth driver (RM’ mil)
0.8%
CTI ratio:FY15: 45.7% (reported); 48.5% (underlying) FY16: 58.8% (reported); 57.4% (underlying)
Growth & Productivity
5%
Infrastructure75%
Compliance20%
Total: RM230.6 mil
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
FY07 FY10 FY13 FY15 FY16Industry
Ave
Equity & debtcapital
10% 15% 14% 15% 16% 15%
Customer deposits
60% 77% 75% 74% 73% 73%
Term funding & loans with recourse >1year
4% 2% 7% 8% 8%
6%
Term funding & loans with recourse <1year
1% 1% 1% 1% 2%
Deposits from banks & FIs
25% 5% 3% 2% 1% 6%
Diversified funding structure, prudent liquidity management
18
Funding composition vs. industry
Funding maturity profiles
• Conservative stance on liquidity management with LCRs >100% for all banking entities
• Higher composition of stable medium term funding vis-à-vis industry, creates stability though weighs on cost of funds
81%
14%
4%
1%
< 6 mth
6-12 mth
1-3 yr
3-5 yr
15%
85%
< 1 yr > 1 yr
Deposits from customers and Banks & FIsTerm funding & Debt capital
Loan-to-deposit ratio
94.2%93.7% 93.7%
90.8%
91.7%
89.8%
88.8%88.1%
83.8%84.7%
FY12 FY13 FY14 FY15 FY16
LDR Adjusted LDR
1. Includes stable funding sources
1
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Adequate capital levels
19
Capital adequacy ratios1
RWA / Total Assets
• Whilst capital ratios remain adequate, theGroup is reviewing the optimal capital structureand efficiency of RWA (Basel III FHC @ FY2020)
• Basel III FHC indicative ratios as at 31 March2016 (no requirements until FY2020) – CET 1:circa 10%
• Double leverage ratio: 1.13x; Leverage ratio:9.7%; Total leverage ratio: 7.9%
13.5 22.0 16.912.0
5.0
6.67.0
7.2 15.3
10.5
40% 41%41%
43%
36%
FY12 FY13 FY14 FY15 FY16
Interim dividend (sen) Final dividend (sen)
Dividend payout
10.4%9.3% 9.7% 10.5% 11.2%
11.0% 11.2%11.8%
12.2%14.7% 14.8%
15.5%15.8% 16.1%
FY12 FY13 FY14 FY15 FY16
CET1 Tier 1 RWCAR/Total CAR
Dividend payout
111.9127.0 132.4 133.8 133.8
77.8%72.4% 72.7% 71.5% 71.0%
64.1% 62.2% 63.7% 62.4% 61.9%
FY12 FY13 FY14 FY15 FY16
Total Assets RWA/ Total Assets Industry
1. An average of eight peer domestic banks2. Latest industry data available as at Dec-15 only
1
1. Based on Aggregated Banking Entities and after proposed dividend
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Divisional Performance and Business Insights
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Auto0%
Mortgage0%
Cards0%SBB0%
Personal financing0%
Deposits0%
Others0%
Deposits30%
Auto24%
Cards18%
Mortgage17%
Others8%
Personal financing
3%
Retail banking overview
21
Total income and loans by line of business (RM’ mil)
Total loans
Total income
21%
17%
27%
30%
2%
9%
Auto , 47%
Cards3%
Mortgage45%
SBB2%Others
3%
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Retail Banking performance lifted by better asset quality
QoQ PAT (RM’ mil)
Mortgage and auto finance disbursement QoQ (RM’ bil)QoQ deposit balance (RM’bil)
• PAT growth of 10.4% YoY due to write back of allowances and better recoveries
• Total income declined 14.2% from NIM compression as well as lower cards and merchant fee income
• Write back of allowances reflecting continued improvement in asset quality
• Slower loans growth, total loans excluding auto finance grew 6.6% driven by robust mortgage loans growth
• CASA ratio marginally higher at 25.4% despite total deposits down 2.8%
123.0 103.0
77.8
119.3 120.8
88.3
136.1 122.0
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
Mortgage Auto Finance
40.0 40.9 42.1 42.7 42.1 41.4 41.8 41.5
26.8% 25.5% 24.8% 25.1% 25.3% 25.5% 25.0% 25.4%
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
Total deposits CASA %
22
QoQ growth: 10.4%YoY growth: 10.4%
FY16: RM467.2 milFY15: RM423.1 mil
Mortgage YoY growth : 28.9%Auto YoY growth: 15.6%
QoQ growth: 0.7%YoY growth: 2.8%
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
33%
FY16 PATFY15 PAT Positive growth in FY16 Contraction in FY16
FY16 PAT(composition to Group)
RM’ mil Total Income Expenses PBPProvisions/Allowances
PBT Tax & Zakat PAT
FY16 1,481.6 940.3 541.2 -73.0 614.2 147.0 467.2
FY15 1,725.8 935.4 790.4 226.7 563.7 140.6 423.1
Income Statement (RM’mil)
Balance Sheet (RM’mil/%)
YoY growth 14.2% 31.5% 0.5% 132.2% 9.0% 4.6% 10.4%
Retail Banking
23
FY16
vs
FY15 FY16 FY15
Gross Loans / Financing 46,301.3 46,302.6 ▲ +0.0%
Gross Impaired Loans 1.68% 929.6 775.7 -▼ -16.6%
Customer Deposits 42,738.2 41,501.8 -▼ -2.9%
CASA Deposits 10,737.9 10,532.4 -▼ -1.9%
ROA 0.89% 1.01% ▲ +0.12%
CTI 54.2% 63.5% ▲ +9.3%
Allowance Coverage 75.2% 60.1% -▼ -15.1%
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Perlis
Kedah
PulauPinang
Perak
SarawakKuala Lumpur
Putrajaya
NegeriSembilan
Melaka Johor
Pahang
Selangor
Labuan
SabahTerengganu
Kelantan
Brunei Darussalam
Branches ATM RO
Perlis 1 4
Kedah 6 29
Pulau Pinang 14 49 1
Perak 18 47
Selangor 38 240
Kuala Lumpur 23 129 2
Putrajaya 1 3
Negeri Sembilan 7 38
Melaka 6 39
Johor 21 89 1
Pahang 9 32 1
Terengganu 4 20
Kelantan 2 22
Sabah 9 37 1
Labuan 1 2
Sarawak 15 51 1
175 831 7
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
AmBank Islamic
branches
Weekend Banking Branches
ATMs @ 7-Eleven
ElectronicBanking Centres
Internet & Mobile
BankingAmGeneral AmMetlife AmInvestment
AmCardServices
3 75 358 183AmOnlineAmGenie
32(include 28
dual branded branches)
18 branches52 agencies
14 26
Note(s):
Brunei: AmCapital (B) Sdn Bhd
Retail Banking – Distribution channels
RO: Regional Offices
24
Nationwide Branch Network
Other Customer Touch Points
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Wholesale Banking Coverage
44%
Transaction Banking
22%
Global Markets11%
Capital & Equity Markets
9%
Funds Management
9%
Others5%
Wholesale banking overview
25
Wholesale Banking
Coverage58%
Global Markets
18%
Transaction Banking 11%
Capital & Equity
Markets2%
Others11%
Total Assets
Total Income
Total income and total assets by line of business (RM’ mil)
13%
11%
7%
23%
5%
35%
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Market Share As At 31 Mar 16 (%)
Rank
DCM 11.4% 4
Syndicated Loans 19% 2
MYR Islamic Bonds 14.2% 4
FUM1 10.0% 4
Wholesale Banking earnings down from subdued market, disbursement picking up
QoQ PAT (RM’ mil)
Net loan disbursement (RM) movementLeague table
• YoY PAT decreased 16.8% impacted by subdued capital market activities and higher allowances
• Total income fell 13.1%:
WB Coverage & Transaction Banking – impacted by NIM compression
Global Markets – mainly from weaker fixed income trading
Capital & Equity Market – cautious business sentiment and volatile markets affected Bursa turnover and deal execution
Funds Management – lower AUM driven by weaker market performance and redemptions
• Both loans and deposit balances were relatively stable YoY though CASA deposits increased 6.2%
216.4 260.9 241.3 268.8 191.5 233.1 179.3217.4
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
1. FUM data consists of unit trust funds only
1. Net movement equals to disbursement less repayment
26
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
Disbursement
Net movement
FY15: RM987.4 mil FY16: RM821.3 mil
QoQ growth: 20.2%YoY growth: 16.8%
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
FY16 PATFY15 PAT Positive growth in FY16 Contraction in FY16
Income Statement (RM’mil)
Balance Sheet (RM’mil/%)
13.1% 12.9% 13.4% 42.7% 17.8% 20.9% 16.8%
Wholesale Banking
YoY growth
54.7%
RM’ mil Total Income Expenses PBPProvisions/ Allowances
PBT Tax & Zakat PAT
FY16 1,457.9 517.1 940.9 -122.2 1,063.0 241.7 821.3
FY15 1,676.8 596.8 1,080.0 -213.1 1,293.1 305.7 987.4
FY16 PAT(composition to Group)
59%
27
FY16
vs
FY15 FY16 FY15
Gross Loans / Financing 41,563.7 41,638.8 ▲ +0.2%
Gross Impaired Loans 2.22% 642.7 924.7 ▲ +43.9%
Customer Deposits 51,426.6 51,086.4 -▼ -0.7%
CASA Deposits 8,403.5 8,923.9 ▲ +6.2%
ROA 2.00% 1.56% -▼ -0.45%
CTI 35.6% 35.5% -▼ -0.1%
Allowance Coverage 71.7% 52.5% -▼ -19.1%
Ave Assets Management 45,331.3 45,268.3 -▼ -0.1%
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
314.6 334.2 318.3 316.1 315.0 310.9 307.6 344.8
72.2 69.7 69.9 70.5 70.7 67.3 70.7
80.4
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
Motor Non-Motor
General insurance, reflecting higher claims experience and lower investment income
28
QoQ PAT (RM’ mil)
QoQ premium growth (RM’ mil)Loss ratio and combined ratio
• Notwithstanding lower industry vehicle sales, YoY gross premium sustained at RM1,567.4 mil (FY15: RM1,565.5 mil)
• PAT impacted by lower investment income and higher claims
• Loss and combined ratios were higher largely due to disallowance of input tax credit under GST
• Non-motor mix was marginally higher at 18.4% (FY15: 18.0%) and more efforts underway to increase contribution from non-motor products
62.6 69.9 61.4 62.5 58.9 51.5
22.8
60.9
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
81.3% 57.5% 65.4% 63.8% 63.0% 62.3% 66.6% 64.2%
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
Loss Ratio Combined Ratio
93.9% 92.5%89.3%
104.4%
93.2%99.5%
85.3%
403.9388.2 386.6 385.7 378.3378.293.4%
386.8
FY15: RM256.4 mil FY16: RM194.1 mil
QoQ growth: >100%YoY growth: 24.3%
QoQ growth: 12.4%YoY growth: 0.1%
FY15: 91.2% (Combined Ratio); 62.8% (Loss Ratio)FY16: 96.4% (Combined Ratio); 64.0% (Loss Ratio)
FY15: RM1,565.5 mil
425.2
FY16: RM1,567.4 mil
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
9MFY16 PAT9MFY15 PAT Positive growth in 9MFY16 Contraction in 9MFY16
Income Statement – Insurance (General & Life/Takaful) (RM’mil)
Income Statement – Group Funding & Others (RM’mil)
Insurance and Group Funding & Others
RM’ mil Total Income Expenses PBPProvisions/Allowances
PBT Tax & Zakat PAT
FY16 484.3 320.1 164.2 3.4 160.7 -14.0 174.8
FY15 564.5 303.3 261.2 -60.1 321.2 60.2 261.0
14.2% 37.1% 5.6% >100% 49.9% >100% 33.0%YoY growth FY16 PAT(composition to Group)
12%
29
RM’ milTotal
IncomeExpenses PBP
Provisions/Allowances
PBT Tax & Zakat PAT MI PAT
FY16 272.0 396.8 -124.7 -17.8 -106.9 -43.1 -63.8 0.0 -63.8
FY15 757.6 322.4 435.2 8.9 426.3 53.2 373.0 0.0 373.0
FY16 PAT(composition to Group)
-5%
YoY growth64.1% >100.0% 23.1% >100.0% >100.0% >100.0% >100.0 % 54.3% >100.0%
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
PATZ: profit after tax and zakat
Islamic Banking
FY16 Gross Financing(composition to Group)
Income Statement (RM’mil)
RM’ mil Total Income Expenses PBPProvisions/Allowances
PBT Tax & ZakatPATZFY16
FY16 743.7 413.0 330.7 -6.6 337.3 84.6 252.7
FY15 845.8 369.1 476.7 156.9 319.8 71.2 248.5
YoY growth 4.8% 30.6% 22.6% >100% 5.5% 18.8% 1.7%
Balance Sheet (RM’mil/%)
FY16 PAT(composition to Group)
FY16 PATFY15 PAT Positive growth in FY16 Contraction in FY16
18%
32%
30
FY15 FY16
Gross Financing 28,022.3 27,784.7 -▼ -0.8%
Gross Impaired Financing 2.18% 606.5 605.2 -▼ -0.2%
Customer Deposits 29,749.0 28,375.4 -▼ -4.6%
CASA Deposits 5,819.7 5,861.9 ▲ +0.7%
ROA 0.68% 0.61% -▼ -0.07%
CTI 43.6% 55.5% ▲ +11.9%
Allowance Coverage 86.5% 65.0% -▼ -21.5%
FY16
vs FY15
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
536.9 445.8 416.6 519.2 339.5 382.5 300.2 280.0
16.0%12.7% 11.8%
15.1%
9.3%10.2%
8.0% 7.5%
1QFY15 2QFY15 3QFY15 4QFY15 1QFY16 2QFY16 3QFY16 4QFY16
PATMI Reported ROE
95.1 94.8 99.8 102.8 99.8 99.7 103.2 102.1
90.0% 89.3%85.9% 83.8% 84.3% 85.6% 82.8% 84.7%
1QFY15 2QFY15 3QFY15 4QFY15 1QFY16 2QFY16 3QFY16 4QFY16
Customer deposits Adjusted LDR ratio
1. Customer deposits include stable funding sources
Quarterly performance
Cost-to-income ratio and expense growth (%)Customer deposits1 (RM’ bil) and LDR ratio (%)
PATMI (RM’ mil) & ROE (%)
61.0 60.6 62.4 63.5 61.9 63.5 63.8 65.2
1QFY15 2QFY15 3QFY15 4QFY15 1QFY16 2QFY16 3QFY16 4QFY16
Loans excluding Auto Finance
Total
QoQ growth: 1.3%QoQ growth (excl.AF) : 2.1%PATMI QoQ growth: -6.7%
ROE QoQ growth: -0.5%
85.6 84.7 86.285.7 84.1 85.3
Net lending (RM’ bil)
85.4
QoQ growth: -1.1%
57.5%
31
57.5%
QoQ CTI change: 5.0%Expense growth change: -4.0%
42.8% 44.0%49.2% 47.9% 50.5% 53.4%
63.5%68.5%
30.3%
-21.1%
0.3% 7.3%
-8.5%
2.5%
13.5%
9.5%
1QFY15 2QFY15 3QFY15 4QFY15 1QFY16 2QFY16 3QFY16 4QFY16
CTI % Expenses growth %
86.5
24.6 24.1 22.723.3 22.2 21.8 21.6 21.3
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
49.654.0
59.363.8
43.3
FY12 FY13 FY14 FY15 FY16
CAGR FY11-16: -0.6%YoY growth: -32.1%
RM (sen), annualised
Yearly performance
Total income (RM’ mil) and non-interest income (%)
EPS (basic)ROA (%)
PATMI (RM’ mil) & ROE (%)
1.39% 1.37%1.45%
1.60%
1.05%
FY12 FY13 FY14 FY15 FY16
CAGR FY11-16: -0.07%/ -0.06%¹YoY growth: -0.55%/ -0.51%¹
3,926 4,306 4,3794,743
4,2633,696
30% 34% 31% 34%41%
36%
FY11 FY12 FY13 FY14 FY15 FY16
Total income (underlying)
Total income (reported)
Non-interest income %
CAGR FY11-16: -1.2%YoY growth: -22%/ -13%¹
32
4,725
1,484 1,621 1,782
1,639 1,302
13.8% 13.9% 14.1% 13.8%
8.8%
FY12 FY13 FY14 FY15 FY16
PATMI Reported
PATMI Underlying
ROE (%)
1,919
1,356
ROECAGR FY11-16: -1.0%/ -0.9%¹YoY growth: -5.0%/ -2.7%¹
PATMICAGR FY11-16: -0.6%/ 0.2%¹YoY growth: -32.1%/ -17.3%¹
Note:1. Underlying
Underlying ROA is 1.09%
Underlying ROE is 9.1%
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
LDR1 of 84.7%
AmBank Islamic Berhad
1. RM2b Subordinated SukukMusharakah Programme
2. RM3b Senior SukukMusharakah Programme
3. RM3b Basel III-compliant Subordinated SukukMurabahah Programme via Tawarruq arrangement
AMMB Holdings Berhad
1. RM2b Medium Term Notes Programme (Senior and/or Subordinated)
Funding diversity underpinned by
CASA: RM18.7 billion Fixed deposits: RM71.7 billion
(strong retention)
Supplemented by term funding & debt capital
AmBank (M) Berhad
1. RM500m Innovative Tier-1 Capital Securities Programme
2. RM500m Non-innovative Tier 1 Capital Securities Programme
3. RM2b Medium Term Notes
4. RM4b Tier-2 Subordinated Notes
5. RM7b Senior Notes2
6. USD2b Euro Medium Term Notes
1. Includes stable funding sources 2. 1st senior notes issuance by a financial institution in Malaysia
AmBank (M) Berhad &
AmBank Islamic Berhad
Loans with Recourse
Recourse obligations on loans sold to
Cagamas - maturing in 2017 and 2018
Islamic financing sold to Cagamas –
maturing in 2016 and2018
• Statutory reserve and liquidity requirement savings
• Reduced exposure to interest rate risks
Funding characteristics
• Improve funding stability, maturity gap and liquidity ratios
• Reduce dependence on short-dated deposits to fund long-dated fixed rate loan assets which incur liquidity risk and interest raterisk
• 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
Funding sources and maturity profile
33
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
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 – AMMB Holdings Berhad
• Shayne Elliott, ANZ’s CFO (resigned on 15 October 2015 andhe assumed the role as ANZ’s CEO starting 1 January 2016)
• Mark Whelan, Director and CEO Australia (resigned on 1March 2016 and he assumed the role as ANZ’s GroupExecutive, Institutional)
• Suzette Corr – Director (General Manager HR Australia andGroup General Manager Talent & Culture, ANZ)
Board representation –AmBank (M) Berhad, AmBank IslamicBerhad & AmInvestment Bank Berhad
• Graham Hodges – Director (Deputy Chief Executive Officer,ANZ)
Management representation
• Mandy Simpson – Chief Financial Officer
• Nigel Denby – Chief Risk Officer
• Tan Chin Aun - Transaction Banking
ANZ & IAG
34
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 / Chief Commercial Officer of IAG Asia)
Management representation
• Derek Roberts – CEO, AmGeneral Insurance Berhad
• Arron Mann – Senior Vice President, Claims
• Chris Tandy – Senior Vice President, Product, Pricing & Underwriting
• Luke Boyle – Senior Vice President, Digital & Direct Distribution
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
AMMB Holdings Berhad
23.8%1 AmCorp 13.0% EPF 15.1% Others 48.1%
100% AmBank (M) Berhad
100% AmInvestment Group Berhad
100% AmInvestment Bank Berhad
FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016
27% 27% 26% 29% 31% 29% 26%
1.ANZ: ANZ Funds Pty Ltd,a wholly owned subsidiary of Australia and New Zealand Banking Group Limited2.Formerly known as AmG Insurance Berhad3.Formerly know as Kurnia Insurans (Malaysia) Berhad4.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% AmBank Islamic Berhad
100% MBF Cards (M’sia) Sdn Bhd
33.33% Bonuskad Loyalty Sdn Bhd
100% AMAB Holdings Sdn Bhd
51% AmGeneralHoldings Berhad2
~50% AmMetLife Takaful Berhad4
~50% AmMetLifeInsurance Berhad4
100% AmGeneral Insurance Berhad3
49%
~50%
~50%
As at 31 March 2016
Retail Banking Wholesale Banking Islamic Banking General InsuranceLife Assurance &
Takaful
Shareholding structure & franchise value
35
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
5.57 5.20 5.20 5.10 4.90 4.80 4.80 4.80 4.75 4.70 4.60 4.47 4.40 4.20 4.11 4.10 4.10 4.10 4.00 3.80 3.60 3.50
-18.5%
0.4%
17.5%
26.6%
25.0%
98.0%
98.5%
-35.0% -15.0% 5.0% 25.0% 45.0% 65.0% 85.0% 105.0% 125.0%
CIMB
MBB
AMMB
KLCI
RHB Cap
PBB
HLBK
(Note: 18 May 2007 vs. 31 Mar 2016)
Ratings FY2007 FY2015
AmBank (M) RAMLT: A2, ST: P1 Outlook: Stable
LT: AA2, ST: P1Outlook: Stable
S&P LT: BBB-, ST: A-3Outlook: Stable
LT: BBB+, ST: A-2Outlook: Stable
Moody’sLT: Baa2, ST: P-3Outlook: StableBFSR: D-
LT: Baa1, ST: P-2Outlook: Stable*BCA: baa3*Adj BCA: baa3
AmInvestment RAMLT: AA3, ST: P1 Outlook: Stable
LT: AA2, ST: P1 Outlook: Stable
AmBank Islamic RAMLT: A2, ST: P1 Outlook: Stable
LT: AA2, ST: P1 Outlook: Stable
AMMB RAM NALT: AA3, ST: P1 Outlook: Stable
Source : Bloomberg as at 1 April 2016
+3
+3
+1 Notches of ratings upgrades since 2007
+1
AMMB HOLDINGS BERHAD P/EPS : 8.94P/BV : 0.93
Market Price : RM4.59
+3
Average TP : RM4.49Buy : 3(14%)Sell : 11 (50%)Hold : 8 (36%)Average TP / Average CP : 0.97x
Banking sector share price movement / target price and recommendations
36
* Maintained since 16 Jun 15
+2
Buy/Outperform/Overweight/AddP/EPS & P/BV as at 1 April 2016
TP: target priceSell/Underperform/Fully valued/Reduce/UnderweightHold/Neutral/Market perform
Banking Sector Share Price Movement Upgraded ratings
Target Price and Recommendations
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
3.4%
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
June
Sept
Dec
Mar
2010 2011 2012 2013 2014 2015 2016CPI Unemployment
32.1
4.7
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2010 2011 2012 2013 2014 2015
External Trade FDI
92.9
72.9
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
2010 2011 2012 2013 2014 2015 2016
Business Conditions Index Consumer Sentiments Index
points
Source: BNM, MIER, Department of Statistics & Bloomberg
Key economy indicators
37
Business confidence index FDI flow
CPI and unemployment rateGDP, consumption and investment growth
GDP
4.2%
Investment
2.8%
Consumption
4.5%
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
2010 2011 2012 2013 2014 2015 2016
GDP Investment Consumption
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
33.5% 34.1% 30.9% 29.4% 29.3% 28%
74.5% 76.1%80.5%
86.1% 86.8% 89.1%
2.5% 2.0% 1.6% 1.5% 1.3% 1.2%0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
2010 2011 2012 2013 2014 2015
Gross national savings Household debt/GDP
Retail impaired loans ratio*
5.8 6.5
0.6 0.6 0.4
2.4 0.4
9.4
7.3
2014 2015
0.01.02.03.04.05.06.07.08.09.0
10.0
Residential Hire Purchase Personal Financing
Others* Total
To be updated for the his
* Retail comprise purchase of transport vehicle, purchase of residential property, personal use and credit card
Source: BNM & Bloomberg
* Effective 2 January 2015, the Base Rate would replace the Base Lending Rate as the main reference rate for new retail floating rate loans
Banking system data
38
Key interest rates Asset quality
Household debt movementHousehold debt, national savings and retail impaired loan ratio
Annual Change(%)
*includes Credit Card, Securities, Non-residential & others
1.2%
94.3%
Mar
Jun
Sept
Dec
Mar
Jun
Sept
Dec
Mar
Jun
Sept
Dec
Mar
Jun
Sept
Dec
Mar
Jun
Sept
Dec
Mar
Jun
Sept
Dec
Mar
2010 2011 2012 2013 2014 2015 2016
GIL LLC
Loan loss coverage
Gross impaired loans
4.60%
3.25%
6.80%
3.88%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Avg lending rate (commercial banks) Average OPR Average BLR Base rate
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
1,668.7
86.9%
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
2010 2011 2012 2013 2014 2015 2016
Total deposits LD ratio
16.5%
13.9%13.0%
Mar
Jun
Sept
Dec
Mar
Jun
Sep
Dec
Mar
Jun
Sep
Dec
Mar
Jun
Sep
Dec
Mar
Jun
Sept
Dec
Mar
Jun
Sep
Dec
Mar
2010 2011 2012 2013 2014 2015 2016
RWCAR Tier 1 CET 1
7.3%
5.6%
6.4%
Mar
Jun
Sept
Dec
Mar
Jun
Sept
Dec
Mar
Jun
Sept
Dec
Mar
Jun
Sept
Dec
Mar
Jun
Sept
Dec
Mar
Jun
Sept
Dec
Mar
2010 2011 2012 2013 2014 2015 2016
Retail yoy growth Non Retail yoy growth Total loans yoy growth
1.1
18.4
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
2010 2011 2012 2013 2014 2015 2016
New issues of equity New issues of debt
Source: BNM & Bloomberg
Beginning January 2013, capital components are reported based on Basel III Capital Adequacy Framework
Basel II Basel III
RM
’bil
RM
’mil
39
Banking system data
Capital ratios Capital activities
Loan growth Deposit growth
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Business Opportunities in Malaysia driven by Budget 2016
40
Affordable housing allocation
Infrastructure spending to enhance accessibility
Spur Domestic Investment to contribute to 26.7% of GDP
Small and Medium Enterprises to contribute 41% of GDP by 2020
• Shariah-compliant SME Financing Scheme – RM1bil
• SME Blueprint to provide funds for entities atvarious stages of business development –RM107mil
• Entrepreneurs Acceleration Scheme & SMECapacity and Capability Enhancement Scheme –RM60mil
• SME Technology Transformation Fund to providesoft loans at 4% – RM200mil
• Small Retailer Transformation Programme (TUKAR)& Automotive Workshop Modernisation (ATOM) –RM18mil
• MRT Line 2 – RM28bil
• LRT Line 3 – RM10bil
• Pan-Borneo Highway – RM16.1bil
• Rapid Transit bus project – RM1.5bil
• BRT Kota Kinabalu – RM1bil
• Jalan Tun Razak traffic dispersal project –RM900mil
• Major Proposed Construction Projects:
KL-Singapore High Speed Rail – RM30bil
Tun Razak Exchange (TRX) – RM26bil
SUKE & DASH expressway – RM4.5bil
• RM1.6bil allocated to build 175,000 units of PR1MAhouses
• RM200mil allocated to help first-time house buyersafford their down payment
• 100,000 new houses to be built in 2018 under1Malaysia Civil Housing Program (PPA1M)
• 10,000 subsidized houses to be built under RumahMesra Rakyat 1Malaysia programme
• Malaysian Vision Valley Development covering 108,000hectares in Negeri Sembilan – RM5bil
• Cyber City Centre in Cyberjaya – RM11bil
• KLIA Aeropolis township – RM7bil
• Khazanah Nasional to invest RM6.7bil in 9 high impactdomestic projects in 2016
• RAPID Complex in Pengerang, Johor – RM18bil
• Development of Rubber City in Kedah, Samalaju IndustialPark in Sarawak and Palm Oil Jetty in Sabah – RM482mil
• MIDA investment for enhancement of chemical,electrical, electronics, machinery industries – RM730mil
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Budget 2016 contribution to 11th Malaysia Plan (11MP)
41
SIX Strategic Thrusts in 11MP (2016-2020)
Enhancing inclusiveness towards an equitable society
Improving wellbeing for all
Accelerating human capital development for an advanced nation
Pursuing green growth for sustainability and resilience
Strengthening infrastructure to support economic expansion
Re-engineering economic growth for greater prosperity
Budget 2016 Allocation – RM258.2 Billion*
• ▲ Personal tax reliefs (child, spouse and parents)
• ▲ GST zero-rated items
• Minimum wage (11% ▲ for private sector, 33% ▲ for civil servants)
• BR1M for 4.7mil households
• Affordable housing allocation (~RM1bil ▲ from 2015)
• ▲ Tax rate for high income earners
• Accelerating regional economic development (RM23bil for Malaysian Vision Valley, Cyber City Centre, KLIA Aeropolis)
• Improving transport infrastructure
• Income opportunities for B40 households
• Unlocking the capital market (incentives for Sustainable & Responsible Investments, retail bonds, sukuk, Shariah funds an instruments, REITs)
• Fostering SME & Bumiputeragrowth (RM1.4bil funds for SME and RM0.9bil funds for Bumiputera equity)
• Attracting green investments (RM1.2bil Green Tech Financing scheme, higher quota for solar)
People Growth Business
*Note: Budget was recalibrated on 28th January 2016 from a previous amount of RM267.2 bil
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
• 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, 149 EPPs
• 60 Biz Opportunities
• Private-sector led
Competitiveness ‘Enablers’
• 6 SRIs & 51 Policy Measures
• RM1.4 trillion investment
• 92% private investment> 73% DDI, 27% FDI
• 8% public investment
ECONOMIC TRANSFORMATION
PROGRAMME
ETP Overview Achievement of 12 NKEAs in 2013-2015
2020Target
2011 2012 2013 2014 2015 To-date% of
Target
Private Investment (RM’bil) 1,288.0 110.9 23.6 17.2 16.8 10.9 179.4 13.9%
GNI per capita (USD per capita)
15,000 9,710 228 168 320 -316 10,110 67.4%
Job Creation (mil) 3.3 0.2 0.4 0.4 0.5 0.3 1.8 54.5%
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
Source: NTP Annual Report 2015, ETP Annual Report 2013 & 2014, Research House Report
Tracking of EPPs
NKEAs
2020 Target KPI Scoring*
GNI(RM’bil)
NewJobs
2015 2014 2013
Greater KL/ Klang Valley 190 320,000 111% 103% 98%
Oil, Gas & Energy 131.4 52,300 107% 108% 97%
Financial Services 180.2 275,400 103% 121% 117%
Wholesale & Retail 156.0 454,190 122% 104% 124%
Palm Oil & Rubber 230.9 41,600 111% 106% 78%
Tourism 66.7 497,000 97% 126% 115%
Electrical & Electronics 53.4 157,000 116% 104% 105%
Business Services 78.7 245,000 109% 96% 102%
Communications Content &
Infrastructure35.7 43,162 123% 110% 101%
Education 33.6 535,000 109% 116% 102%
Agriculture 28.9 109,335 104% 120% 98%
Healthcare 35.3 181,000 101% 105% 103%
42
Economic Transformation Programme
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16
Apr
-14
May
-14
Jun
-14
Jul-
14
Aug
-14
Sep
-14
Oct
-14
No
v-14
Dec
-14
Jan
-15
Feb
-15
Mar
-15
Apr
-15
May
-15
Jun
-15
Jul-
15
Aug
-15
Sep
-15
Oct
-15
No
v-15
Dec
-15
Jan
-16
Feb
-16
Mar
-16
Balance O/S Net outflows
Household Income Group (% of loans outstanding)
Auto Finance
Risk Grades (% of loans outstanding)
Auto Finance monthly balance vs. net outflowsAuto Finance loans vs industry vehicle sales
43
Industry vehicle sales (No.)AMMB disbursement (RM)
25% 25% 21%
41%47%
46%
34%28% 32%
0% 0% 0%
FY14 FY15 FY16
Exceptionally/
Very Strong
Strong/Satisfactory Moderate/Marginal Sub-Standard
67% 70% 74%
33% 30% 26%
FY14 FY15 FY16
Other Income brackets ( >RM3K )
Vulnerable Income bracket ( <=RM3K )
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
Top 4STRATEGIC GROWTH PLANS AMBANK GROUP
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
• Moderate GDP growth of 4.2% projected for2016 due to:
• Soft exports led by weak commodity prices,low government spending and slowerbusiness expansion
• Moderate domestic spending from high costof living and weak consumer sentiments
• Inflation expected to rise 2% in 2016 on theback of low commodity prices, slower demandand high base effect in 2H2015
• Against backdrop of a challenging and uncertainglobal environment with downside risk stillpresent, domestic monetary policy will remainsupportive and accommodative of economicactivity
• Ringgit’s pressure comes from weak oil prices,potential capital outflow from further rate hikesby US Fed and negative external news flows
• Authorities to maintain prudent and pragmaticpolicies, reigning in fiscal deficit (2016F:-3.1% ofGDP) and household debt (89.1% of GDP in2015)
• Monetary policy expected to remain supportivefrom the current challenging environment
• Loans growth to moderate in tandem with slowerGDP expansion and high LD ratio
• Margins remain a challenge from the persistence ofintense rate-based competition for deposits
• Asset quality may come under pressure from risinginflation, subsidy reductions and GST impact and amore challenging business environment
Malaysia Banking
Key economic indicators
2014 2015 2016F
RGDP yoy% 6.0 5.0 4.2
Inflation yoy% 3.2 2.1 2.0
OPR% 3.25 3.25 3.25
Unemployment % 2.9 3.2 3.5
Fiscal Balance % GDP -3.4 -3.2 -3.1
CABOP% GDP 4.4 3.0 1.5
Moderate growth for 2016
45
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2014 2015 2016
Resident Non-Resident
7.5%
5.1%5.6%
4.7%
6.0%
5.0%
3.22 3.06 3.09 3.15 3.27
3.91
2010 2011 2012 2013 2014 2015
Real GDP Growth Avg USDMYR
0.7
2.0
2.6
2.8
4.8
5.0
5.8
6.9
7.3
0.0 2.0 4.0 6.0 8.0
Chinese…
Singapore
Korea
Thailand
Indonesia
Malaysia
Philippines
PR China
India
3.4%
92.9
72.9
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2010 2011 2012 2013 2014 2015 2016
CPI
Business Conditions Index
Consumer Sentiment Index
Malaysia’s GDP Growth may be slowing, though still among the faster growing-economies within the region
Business and consumer confidence recuperating
Private domestic demand continued to anchor growth
Source: Bank Negara Malaysia, Bloomberg
Source: Bank Negara Malaysia, MIER
3.6 3.1 2.6
1.81.1
0.9
0.6
0.60.3
6%
5%
4-4.5%
2014 2015 2016F
Net Exports Change in Stocks Public Investment
Public Consumption Private Investment Private Consumption
GDP Growth
Source: Bank Negara Malaysia, Department of Statistics
Net inflows of investments since 4Q 2015
Source: Bank Negara Malaysia, Department of Statistics
Headwinds, bright spots and opportunities
46
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Residential properties, still room for growth in selected segments and risk profiles
47
Housing supply gap in Malaysia
AmBank Group - Mortgage loans movement (RM’ mil) and market share
Focused on owner-occupied properties
12,591 13,353 14,346 15,39017,637
4.5% 4.3% 4.0%3.8% 4.0%
FY12 FY13 FY14 FY15 FY16
AmBank Market Share
Owner occupied
93%
Non-owner occupied
7%
AmBank GroupResidential Properties
Residential, 65.2%
Agricultural18.4%
Commercial8.8%
Land5.7%
Industrial1.9%
117,250
166,600
203,000
166,876
80,089
203,000
2005-2008 avg. 2011-2015e avg. 2016f-2020f avg.
Net increase in number of households Completion of new houses
+49,626 (86,511)
Source : BNM Annual Report 2015Source : National Property Information Centre (NAPIC)
Residential properties dominated property transactions in 2015
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
69.0 74.5 77.4 75.7 75.5
8.810.3
11.9 12.1 12.4
FY12 FY13 FY14 FY15 FY16
Non-SME SME
Wholesale banking - higher loans to SME, reducing exposure to commercial properties
48
AmBank Group SME loans growth ‘currently’ trailing banking system
Relatively high vacancy rates (%) of commercial properties (office segment) in Malaysia
Vacancy rates of commercial properties (retail space/shopping malls)
System SME loans growth outpaced GDP growth
SME YoY growth: 2.5%
55.3
65.6 67.1
12.7% 13.3%14.6%
7.9%9.0%
7.7%
4.7%6.0%
5.0%
2013 2014 2015
Business Loans (RM' bil) SME Loans Growth Rate
Business Loans Growth Rate GDP Growth
28%25%
12%9% 7%
5% 5%
Source : BNM Annual Report 2015
Source : BNM Annual Report 2015Source : BNM Annual Report 2015
Klang Valley20.4%
Malaysia16.3%
Other States10.8%
2011 2012 2013 2014 2015
Regional average6.6%
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
• >40 senior mgnt members and working group members
• Debated and prioritize key initiatives that would deliver to the value
propositions and how success should be measured
We have faced challenging times with lower performance recent years
We have focused on de-risking the portfolioAsset quality improved significantly albeit sharp decline in loan market share
Time is now right for us to
embark on a new growth
trajectory and rebuild franchise
value
49
New strategic growth plans developed collaboratively
with leaders & people on-the-ground to ensure feasibility & buy-in
Belief audits and
engagements
Visioning
workshop
Working
groups
Prioritization
workshop
In-principal
approval
from board
Execution
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
Our New Purpose
To help individuals and businesses in Malaysia
grow and win together
We are not just a retail bank. We are not just
a corporate bank nor just an investment bank.
Our business is centered on leveraging domestic
growth opportunities. We will expand in Malaysia
with Malaysian business. We have no aspiration
of being a regional bank.
We are not transactional. We focus on relationship and are advisors and long
term partners to our customers. We help by being professional, reliable and
fast, and giving them the best service. By helping, we earn their trust
We believe in growth, for our customers, for our people
and for our business. We support and empower our
customers and our people to achieve their aspirations
Externally we focus on building our customers into winners.
Internally we focus on performance, teamwork and
collaboration to win in the market.
50
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
Our "Top 4" Aspiration
Top 4 Aspirations
In Key Segments ~ 4 Years (2020)
To be Top 4 in each of our 4
growth segments (Mass Affluent,
Affluent, SME, Mid Corp)
To sustain Top 4 in each of
our current engines (Corporate
loans, DCM, asset management)
To be Top 4 in each of our 4focus products (Cards, TB,
Markets, Wealth Management)
To be Top 4 Best Employer in
Malaysia
51
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
10 metrics will measure how well we live up to our purpose & our strategic priorities
Financial metrics
1. Market capitalization (relative)
2. Revenue growth
3. ROE
4. P/E
5. NIM
6. CTI
7. NPL ratio
Non financial metrics
8. Customer turnaround time and
customer satisfaction
9. Trusted brand
10.Employee engagement and
attractiveness to best talent
To be measured via internal and external surveys
Our Top 4 Aspirations
in Key Segments by
2020
"Firing up new
growth engines"
"Attain market leadership
in key segments & products"
"Setting up
for success”
"Optimize
current engines"
Our strategic prioritiesConsidering growth areas, whitespaces, and
our capabilities
1
2
3
4
52
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
Summary: Top 5
focus areas of
our Institutional
strategy
Key strategic initiatives for Institutional Business
Focus on expanding with Malaysian companies in Malaysia
Strategically select
target segment / clients
to grow
1
Capture full opportunity
in lower-end Large
Corps
2
1. Grow in segments that are strategic economic drivers to GDP growth
2. Develop coverage culture that focus on winning holistic wallet through strong
analytics & KPI alignment
3. Enrich clients experience via process re-engineering at all touchpoints
4. Leverage lending relationships to capture operating a/c & flow business
5. Diversify and grow assets by holding high quality bonds originated
53
Further leverage on
strength in Capital Mkts
in high-end Large Corps
3
S t r a t e g i cI n i t i a t i v e s
Improve execution
and TAT
4
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
Enhance coverage model by
building better focus
and improving
productivity
1
Achieve higher wallet
share through
relationship focus
2
Key strategic initiatives for Mid-Corporates
Increase speed of execution by
optimizing processes and
policies
3
Summary: Top 5
focus areas of
our Mid-Corp
strategy
1. Coverage model to enable RMs to focus on sales & service to deepen
relationships
2. Joint account planning to ensure we bring the “bank” to our customers
3. Focus on quality, instead of quantity – enter as core credit partner and
become main banker
4. Leverage analytics to fully penetrate relationships beyond lending
5. Speed credit process to provide differentiated service to high-value, high-
quality customers
54
S t r a t e g i cI n i t i a t i v e s
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
Key strategic initiatives for SMEs
Focus on SME as a segment
– capture entire SME
spectrum from
micro to larger SMEs
1
Roll out differentiated
cost-effective relationship-
based sales & service
model leveraging digital
2
Enhance offerings to
service needs of SMEs
3
Refine credit to match SME
needs and risk profiles (with
appropriate risk architecture)
4
Summary: Top 5
focus areas of
our SME strategy
1. Capture the "underserved area”
2. Human touch but lower cost-to-serve via digital platform
3. Customers can deal with us through a variety of channels (omni-channel)
4. Segment SME spectrum and design segment-specific product bundles (incl.
integrated wealth proposition for SME owners)
5. Differentiated risk models and processes
55
S t r a t e g i cI n i t i a t i v e s
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
Why AmBank Can Win in SME
Existing large and
untapped SME base
Why can
AmBank Win
in SME?
175 branches across the regions
25 Cards merchant centers
25 Business centers
Unique business products – Supply Chain
Financing (ANZ), AmCash Mgmt FundChannels & Product
Readiness
54k merchant base (low CASA penetration)
2k+ HP dealers (medium CASA
penetration)
Large Corporate customers base with SME
subsidiaries
Leveraging Digital &
Analytics
Remote RMs increase productivity
enabling higher servicing ratio
Analytics to identify SME needs, improve
acquisition & x-sell penetration rate.
SME on digital – The ANZ connection
Quantum Leap via Technology
56
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
Provide wide range of
products to meet banking
and investment needs, offer
relationship rewards to
capture share of wallet
4
Enhance product
offerings to become the
"main bank" and drive transactions
1
Key strategic initiatives for Retail
Offer a cost-effective wealth
advisory proposition
2
Deliver superior channel
proposition (both digital and
physical)
3
1. Relationship Manager 2. Mass Affluent
1. Innovative hooks & total relationship privileges to drive main bank relationship
2. Leverage digital proposition supported by "segment of one" analytics
3. Low-cost wealth advisory proposition & differentiate via advisory-led wealth
management model with strong Front Office "Execution" and Middle Office "Brains”
4. Offer wide, innovative and differentiated product offerings
5. ”Segment of one" analytics for targeted needs across customer's life cycle
Summary: Top
focus areas of
our Retail
strategy
57
Differentiate via advisory-led
wealth management model with strong
Front Office "Execution" and Middle
Office "Brains"
5
Build online and offline affluent channel
proposition, with strong digital play
6
S t r a t e g i cI n i t i a t i v e s
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
Key strategic initiatives for AmBank Islamic
Unique Islamic products for
‘blue ocean' and at least
product equivalence with
conventional
2
Penetrate into untapped
Islamic ‘blue ocean’ and
enhance initiatives in
existing spaces
1
1. Add value by penetrating into Islamic ‘blue ocean’
2. Complement Group’s initiatives to grow Islamic banking business in existing
spaces via supporting marketing efforts, trouble-shooting and simplification
3. Lean and mean – leveraged model. To upgrade AmBank Islamic personnel
capacity and capability pursuant to new operating model
Summary: Top 5
focus areas of
our Islamic
strategy
58
Ensure efficiency and
effectiveness via a leveraged
model
3
S t r a t e g i cI n i t i a t i v e s
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
How we will do it: "Run the bank better" and "Change the bank"
Run the bank better
Unlock value across our footprint, capabilities,
customer bases and talent pool
Drive efficiency and build momentum
Change the bank
Create new sources of competitive advantage
through harnessing digital & analytics
to take to next level
R C
~50% of income growth to come from the growth segmentsMass and large corporate to grow in line with the market and maintain share
Growing CASA ratio to 32%Loan growth funded by 13% deposit growth with LDR ~ 92%
Achieving a more sustainable business mix
HI
GH
LI
GH
TS
1. More diversified franchise
2. Higher fee income ratio
3. Stronger CASA franchise
4. Effective cost management
59
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
It's tough...but we have a base to build on
Our brand
Well known brand –
professionalism,
innovation, "small and
nimble"
Our
customers
RB – need to grow
more “main bank”
customers
Blue chip anchor
corporates – many not
yet fully penetrated
across their value chain
Strong, loyal base of
corporates we grew
since they were SMEs
~60k merchants and
dealers, many are
SMEs
Our assets
175 branches, strong
WB regional presence
Recent investments in
Core banking and new
platforms (e.g. TRUE)
and unique assets (e.g.
BonusLink)
Governance, risk and
compliance resources,
processes, procedures
increasingly robust
Our staff
Capable staff – scope
to unlock with new
leadership and culture
change to re-ignite high
performance
Cross-fertilization
opportunities – e.g. in
wealth can leverage
corporate RMs,
research & product
skills, platforms and
processes
Digital
revolutionTechnology and data
analytics enables new
products, markets and
business models
New basis for
competition allowing
small players to
achieve outsized
growth
60
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
Performance Guidance for FY2017 - FY2018
ROE
9.5%
to
10.5%
PATMI
~ 10% Growth p.a.
CTI
50%
To
55%
Dividend
~ 40% payout
Capital Proforma
±1%
CET 1*:
10%
Total:
15%
61
* Refers to FHC CAR
FY2016 IR Results (Business Performance & Investor Relations)Your Bank. Malaysia’s Bank. AmBank.
AmBank Group FY17, foundation for 4 year Strategic Plan
"Top 4" strategydeveloped considering growth areas, white
spaces, and ourcapabilities
Phased development and investment with clear milestones and
targets
Aspiration to become a Top 4 bank by 2020
Governance and compliance remain a
key focus
Conservative funding profiles and efficient capital positioning
To help individuals and businesses in Malaysia
grow and win together
Challenging goal though achievable by
Running the Bank Better and Changing
the Bank
“Run the Bank Better” Unlock value across our
footprint, customer base and talent pool
Team is committed to making change
happen
“Change the Bank”Create new sources of
competitive advantage, harnessing digital &
analytics
62
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Glossary /Disclaimer of warranty and limitation of liability
Reported PerformanceReported performance refers to the financial performance as reported in the audited financial statements and disclosed to the market
One OffsOne 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 PerformanceUnderlying performance refers to the financial performance adjusted for one off impacts as above
Business DivisionsBusiness 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 SegmentsOperating 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
Your Bank. Malaysia’s Bank. AmBank. FY2016 IR Results (Business Performance & Investor Relations)
Glossary/Disclaimer of warranty and limitation of liability
The material in this presentation is general background information about AmBank Group’sactivities current at the date of the presentation. It is information given in summary form anddoes not purport to be complete. It is not intended to be relied upon as advice to investors orpotential investors and does not take into account the investment objectives, financial situationor needs of any particular investor. These should be considered, with or without professionaladvice when deciding if an investment is appropriate.
For further information, visit www.ambankgroup.com;
or contact
Ganesh Kumar Nadarajah
Executive Vice President, Group Finance – Business Performance & Investor Relations
Tel: +603 2036 1435
Fax: +603 2031 7384
Email: [email protected] /