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59th
Annual General MeetingPresentation to Shareholders
by Datuk Abdul Farid Alias, Group President & CEO11th April 2019
Humanising Financial Services
111
Maybank continues to grow from strength to strength
…through the collective efforts of all past and present Maybankers
Net Profit
(RM billion)
Profit Before Tax
(RM billion)PPOP
(RM billion)
Net Operating Income
(RM billion)
FY2013
18.54
FY2018
23.63
FY2013
9.61
FY2018
12.42
FY2013
8.87
FY2018
10.90
FY2013
6.55
FY2018
8.11
CAGR:
4.97%
CAGR:
5.26%
CAGR:
4.21%CAGR:
4.37%
Record financial performance in FY2018, with new highs for all
four performance highlights mentioned above.
27.5% 29.2% 23.8%22.9%
222
Arising from our financial strength, we continue
to reward our shareholders
…with a higher dividend
payout
FY2018 MaybankSG
Peer 1
SG
Peer 2
SG
Peer 3
% of Staff Compensation
& Benefits to Revenue24% 22% 27% 24%
% of Dividend Payout to
Revenue27% 23% 19% 22%
FY2018 MaybankMY
Peer 1
MY
Peer 2
MY
Peer 3
% of Staff Compensation
& Benefits to Revenue24% 25% 22% 27%
% of Dividend Payout to
Revenue27% 14% 25% 12%
We offer the BEST shareholder payout among
the top Malaysia and Singapore Banks.
Shareholders are also the top recipient of value
created by Maybank.
4.716.27
CAGR:
5.89%
33.2%
Dividend Payout
(RM billion)
FY2013 FY2018
333
Operating landscape of 2018 caused some revenue headwinds
Macroeconomic
events of 2018Impact to Maybank Group’s Revenue Drivers
• General Election
(GE) in Malaysia Marginal NIM compression of 3bps YoY as a result of liquidity buffer increase
ahead of GE in 1H FY2018
Slower corporate lending growth arising from infrastructure project reviews
by new government
Uplift in some consumer segments due to consumption tax holiday between
June and August
• Rising rate
environment
Weak investment and trading income on continued capital outflow in
emerging markets on rising US rates, with some ASEAN currencies coming
under pressure
Ability to selectively re-price in some segments on rate hikes in home
markets
• Trade war
between US and
China
Cautiousness in investor sentiment and corporate activities
More open economies are susceptible to adverse growth impact from trade
barriers
However, revenue headwinds were mitigated with continued
discipline in cost and asset quality management
444
Net fund based income grew as group gross loans
expanded 4.8%, contributed by the home markets…
…while lower net fee based income was due to a decline
in investment and trading income given weak equity
markets…
…and continued with disciplined cost management, yielding
lower overhead expenses.
…while net impairments losses reduced mainly on slower
new impaired loans formation, enabling…
…a record net profit of RM8.1 billion and ROE of 11.4%.
The strong performance also contributed to an EPS of
74.2 sen.
Net Fund Based Income
RM17.1b, +3.1%
Net Fee Based Income
RM6.5b, -1.8%
Net Operating Income
RM23.6b, +1.7%
Overhead Expenses
RM11.2b, -1.0%
Net Impairment Losses
RM1.6b, -20.5%
Net Profit
RM8.1b, +7.9%
Earnings per Share (EPS)
74.2 sen, +3.0%
However, we still achieved a new net operating income
record…
PPOP
RM12.4b, +4.2%As a result, Pre-Provisioning Operating Profit hit a new
high of RM12.4 billion…
Our combined efforts supported our FY2018 performance
555
Continued cost discipline
48.9% 48.2% 47.1% 48.6% 47.4%
Cost-to-income Ratio
…in an operating environment where revenue pressures were felt,
resulted in cost-to-income ratio improving to 47.4% and a positive
JAWs of 2.7%. Personnel expenses growth was contained at 5.2%.
Personnel Expenses
FY2016
5,639
FY2017
6,128
FY2018
6,450
RM
million
FY2014
5,019
FY2015
5,765
5.2%
666
Sustained robust liquidity risk indicators
Liquidity Risk Indicators
Dec 2017 Mar 2018 Jun 2018 Sep 2018 Dec 2018
133.1%
153.3%144.9%
130.5% 132.4%
93.4% 92.5% 92.8% 94.4%92.7%
85.8% 85.7% 86.3% 87.5% 86.2%
75.4% 75.3% 76.0% 77.3% 76.1%
LCR LDR LTF LTFE
…through our prudent risk management practices. We prioritised liquidity
strength so that we may serve our clients under any circumstance.
777
FY2017
11,550
Moderating asset quality trends
Allowances for losses on loans
FY2016
2,833
FY2017
1,959
FY2018
1,591
Gross impaired loans (GIL) & GIL Ratio (%)
2.28% 2.34% 2.41%
RM
million
RM
million
GIL Ratio
Gross Impaired Loans-30.8%
-18.8%
…with a decrease in loan loss allowances, due to lower new impaired loan
formation as well as higher recoveries and write-offs.
-23.5%-13.3%
FY2016
11,055
FY2018
12,486
9,2927,105
6,163Newly
Impaired
Loans
888
Improved ROE and EPS performance
ROE (%) & EPS (Sen)
13.8% 12.2% 10.6% 10.9% 11.4%
FY2014
74.2
FY2015
72.0
FY2016
67.8
FY2017
72.0
FY2018
74.2
Earnings per Share
Return on Equity
…through our strong financial performance, despite a higher equity base
to comply with regulatory requirements and to maintain capital strength.
999
Highlights of 2018
The MSL incorporation
solidifies our commitment
to Singapore
Maybank is a Top 500 Global Brand
Among one of eight ASEAN brands
to make the list
We cemented our foothold in Singapore by locally
incorporating Maybank Singapore Limited (MSL),
which now houses our Singapore Community Financial
Services business effective 5 November 2018.
We are the first Malaysian bank to break into the
Global 500 Brands list by Brand Finance, with a brand
value of USD4.2 billion.
Key Awards in 2018
• We were awarded ‘Bank
of the Year in Malaysia’
in 2018 by The Banker
• We won two awards in
TalentCorp’s LIFE AT
WORK Awards 2018 for
‘Best Malaysian
Organisation’ and ‘CEO
Champion for Malaysian
Organisation’
• We ranked among the ‘Top 50
ASEAN PLCs’ as part of the ‘2nd
ASEAN Corporate Governance
Awards’ organised by MSWG
Maybank Risk Academy
Launched to future-proof our
Risk professionals
Set up to build internal risk expertise in order to
equip the organisation with FutureReady, agile and
risk-aware professionals
101010
*Credit, Asset & Risk Management Engine
Maybank’s digital focus areas
“The Best
Online
Customer
Experience”
“Advanced
Asset &
Liability
Management”
“Future-Ready, Speed &
Anytime/Anywhere Availability”
EXPERIENCE
“i.e.: M2U”
TRUST
“CARisMa*”
SECURITY
“CORE”
DATA
111111
DIGITAL TRANSFORMATION
Maximise Digital Engagements
Partner Industry Disruptors
Engage and Foster Fintechs
Deploy Digital Initiatives Across ASEAN
Retune Business Models
Lead Digital Innovations
Redefine Physical Presence
Upskill Workforce On Digital Needs
Automate High Volume TasksEXT
ER
NA
LIN
TER
NA
L
PRINCIPLES
Digital Bank
Of Choice
PLACE CUSTOMER
PREFERENCES FIRST
Principle led digital transformation
121212
Launched QRPayReimagined
Maybank2uGrab Partnership
Implemented
E-CLEVALaunched MAE
A cashless payment
solution using QR
codes, the first by a
bank in Malaysia
A complete change of
user interface based on
feedback from
customers, offering a
personalised and
simplified online
banking experience
Formed a strategic
partnership with Grab
to drive the
acceptance and usage
of cashless payment
A real-time video
assisted claims care
system for motor and
fire insurance, allowing
claims to be processed
via video calls within
15 minutes
A lifestyle-themed
e-wallet, available to
anyone above 12 years
of age without the
need to have a pre-
existing Maybank
account
Digital Achievements in 2018-2019
Digital Highlights 2018-2019
We launched the refreshed
Maybank2u desktop
website, aimed at
delivering an intuitive,
personalised and seamless
customer experience, with
faster turnaround time.
131313
We introduced our FutureReady Digital Upskilling Programme to increase employees’ digital
literacy in line with the Group’s aspiration to be The Digital Bank of Choice.
The Programme’s comprehensive curricular is delivered through the following approaches::
FutureReady Digital Upskilling Programme
Maybank’s Group leadership bench (Board of Directors and EXCO members included) invested
over 500 man-days in intensive classroom learning sessions, learning new skills such as coding
and algorithms programming, and how these skills can be developed in-house.
Strategy, Artificial Intelligence and Machine Learning
Digital Highlights 2018-2019
FutureReady MindsetFutureReady Knowledge & Skills
Digital Immersion Programme
FutureReady Labs:• Leadership Role Modelling
• Enabling Culture
• Practice & Habit
Upskilling on six digital skill areas via:• E-Learning
• Classroom programmes
• Action Learning Projects
141414
• Determine the optimal balance sheet structure for the Group
• Centralise all sources of funds across the Group
• Determine the right pricing for the Group’s liabilities and assets to maximise risk-returns
• Determine the optimal portfolio for each component of the balance sheet
• Allocate capital accordingly based on the optimal portfolio
• Match liabilities to assets to close liquidity gaps
Digital Highlights 2018-2019
Key Features Outcomes
LAYER 1
Data Architecture
and Infrastructure
Universal Data Lake
Group-wide centralised data repository
Group-wide standard data dictionary
Enhanced data timeliness – improve service level agreement
LAYER 2
Risk–Returns
Measurement
and Analytics
Credit Proposal
Simplification
New application for accommodation (AA) format for an effective credit
decision
Re-engineered end-to-end credit process
Comprehensive portfolio allocation strategy
Well defined account strategy and pre allocate customer risk appetite
LAYER 3
Optimisation
Analytics
Balance Sheet
Management
Detailed profit and loss attribution
Improve ROE and sustainable dividend payment
Allow distribution of the bank’s assets effectively
A more comprehensive wealth management solution for customers
Group Chief Risk
Officer’s Letter
Develop a composite outlook (economic, financial, regulatory and
technology landscape)
Forward looking insights from functional risk teams
Enhancement through info/data gap identification
Facilitate development of Central Economic Scenario
CARisMa
151515
We strengthened the Executive Committee with internal talents
…filling the vacancies left by two Maybank veterans
MICHAEL FOONG SEONG YEW
Group Chief Strategy Officer
took on an expanded role as
CEO, International
on 1 June 2018
DATO’ JOHN CHONG ENG CHUAN
Group CEO, Community
Financial Services
Appointed on 1 October 2018
NEW APPOINTMENTSRETIRED
DATUK LIM HONG TAT
Group CEO, Community
Financial Services
Retired on 18 July 2018
POLLIE SIM
CEO, International
Retired on 1 June 2018
161616
Our continued priorities
Liquidity and
Capital Strength
Sustainable
Growth
Agility and
Nimbleness
Sense of Purpose
Looking Out for
the Underserved
Maintain sufficient liquidity to meet
obligations and capital to absorb
potential losses or systemic shocks
Fluid and unpredictable operating
landscape forces us to react
promptly or risk becoming obsolete
Find ways to make financial solutions
accessible to them
Treat all our stakeholders fairly, provide
advice based on their needs and capacity,
and simplify financial solutions.
Look at protecting margins as well as
pricing credits and liabilities correctly
171717
Our priorities in FY2019
Driving positive JAWs across business segments
Managed Group cost growth with CIR ~47%
Continued emphasis on employee up-skilling for digital economy
Expand revenue streams through cross business collaborations
Measured balance sheet expansion in line with economic growth of home markets and Group’s
conservative risk posture
Group ROE guidance of ~11.0%
Income Growth
Disciplined asset quality management and maintain ongoing recovery efforts
Maintain stable liquidity risk indicators ahead of NSFR adoption in 2020
Maintain robust capital positions, while rewarding shareholders with strong effective cash dividend payout
Conservative investment spend focused on improving customer experience with rollout of product/services
Enhancing data driven analytics
Digitalisation
Liquidity and Capital Management
Asset Quality Management
Better Productivity
1
2
3
4
5
181818
Thank you to all shareholders and stakeholders
for your continuous support
Humanising Financial Services
58
MALAYAN BANKING BERHAD
14th Floor, Menara Maybank
100, Jalan Tun Perak
50050 Kuala Lumpur, Malaysia
Tel : (6)03-2070 8833
www.maybank.com
Disclaimer. This presentation has been prepared by Malayan Banking Berhad (the “Company”) for information purposes only and does not purport to contain all the
information that may be required to evaluate the Company or its financial position. No representation or warranty, express or implied, is given by or on behalf of the
Company as to the accuracy or completeness of the information or opinions contained in this presentation.
The presentation does not constitute or form part of an offer, solicitation or invitation of any offer, to buy or subscribe for any securities, nor should it or any part of
it form the basis of, or be relied in any connection with, any contract, investment decision or commitment whatsoever.
The Company does not accept any liability whatsoever for any loss howsoever arising from any use of this presentation or their contents or otherwise arising in
connection therewith.
Humanising Financial Services
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