FY2016 Results, Investor Presentation - AmBank · FY2016 Results, Investor Presentation PART A –FY2016 Results, Investor Presentation (Page 2 –19) ... PAT 1,399.5 2,044.6 MI 97.3

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


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


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


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


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


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


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%


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


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


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%


Retail Wholesale Group

(30.5)

(164.1)

47.7 59.5

240.5

0.2


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%


Strong ~ Very

Strong68%

Satisfactory ~

Moderate21%

Marginal ~ Substandard

8%

Impaired3%

Total loans to O&G sector:

Approximately 4% of total gross loans

>100%


1,906.2

1,680.5 1,662.11,572.7

1,700.9

2.45%

1.98%1.86% 1.79%

1.94%


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


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


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%


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)


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%


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


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)


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


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


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%


LDR Adjusted LDR

1. Includes stable funding sources

1


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%


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%


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%


Total Assets RWA/ Total Assets Industry


1

1. Based on Aggregated Banking Entities and after proposed dividend


Divisional Performance and Business Insights


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%


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



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%


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%



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%


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


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%


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


1. FUM data consists of unit trust funds only

1. Net movement equals to disbursement less repayment

26


Disbursement

Net movement

FY15: RM987.4 mil FY16: RM821.3 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


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%


CASA Deposits 8,403.5 8,923.9 ▲ +6.2%

ROA 2.00% 1.56% -▼ -0.45%

CTI 35.6% 35.5% -▼ -0.1%


Ave Assets Management 45,331.3 45,268.3 -▼ -0.1%


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


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


81.3% 57.5% 65.4% 63.8% 63.0% 62.3% 66.6% 64.2%


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%


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


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


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


-5%

YoY growth64.1% >100.0% 23.1% >100.0% >100.0% >100.0% >100.0 % 54.3% >100.0%


PATZ: profit after tax and zakat

Islamic Banking

FY16 Gross Financing(composition to Group)



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%




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%


CASA Deposits 5,819.7 5,861.9 ▲ +0.7%

ROA 0.68% 0.61% -▼ -0.07%

CTI 43.6% 55.5% ▲ +11.9%


FY16

vs FY15


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%


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


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%


CTI % Expenses growth %

86.5

24.6 24.1 22.723.3 22.2 21.8 21.6 21.3


49.654.0

59.363.8

43.3


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%


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%


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%


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


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


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


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


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%


2010 2011 2012 2013 2014 2015 2016

GDP Investment Consumption


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


1,668.7

86.9%


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


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


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


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


• 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



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


• 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


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


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%


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


69.0 74.5 77.4 75.7 75.5

8.810.3

11.9 12.1 12.4


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%


• >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


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


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


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


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


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



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



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


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



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



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


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


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


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


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


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] /

[email protected]

http://www.ambankgroup.com/

mailto:[email protected]

mailto:[email protected]

Documents

FY2016 Results, Investor Presentation - AmBank · FY2016 Results, Investor Presentation PART A –FY2016 Results, Investor Presentation (Page 2 –19) ... PAT 1,399.5 2,044.6 MI 97.3