Investor Briefing & H Performance Presentation Outline

Transcription

1 Investor Briefing & Performance August Presentation Outline 1. Macro-economic overview 2. Governance & leadership structure 3. Regional expansion and diversification 4. Innovation & digital banking 5. SME strategy 6. Qualitative analysis 7. Social Impact 8. Performance of core business (intermediation) 9. Financial performance 2 1

2 1 Presentation Outline 1. Macro-economic overview 2. Governance & leadership structure 3. Regional expansion and diversification 4. Innovation & digital banking 5. SME strategy 6. Qualitative analysis 7. Social Impact 8. Performance of core business (intermediation) 9. Financial performance 3 1 Foreign Exchange Rate - Kenya The Kenya Shilling has appreciated by 1.0% on a YTD basis against the USD USD / KES % 0.0 Jul 15 Aug 15 Sep 15 Oct 15 Nov 15 Dec 15 Jan 16 Feb 16 Mar 16 Apr 16 May 16 Jun 16 Jul 16 Stability in the foreign exchange market continues to be supported by improved forex reserves currently at USD 7.8 billion (equivalent to 5.5 months of import cover) as at mid July and a narrowing current account deficit largely due to the following: - A lower import bill for petroleum products - Recovery in tourism, tea and horticulture exports - Slowdown in consumer imports - Strong diaspora remittances. The slowdown in credit growth, amplified by the rise in lending rates in Q3-, also supported a stronger KES against the USD, as there was less borrowing to finance imports

3 1 KES vs East African Currencies The Kenya Shilling has slightly USD gained vs. on USH,TSH, YTD basis against RWF, the KSH regional currencies in KES / USHS +1% KES / TSHS +2% KES / RWF +1% Jul 15 Aug 15 Sep 15 Oct 15 Nov 15 Dec 15 Jan 16 Feb 16 Mar 16 Apr 16 May 16 Jun 16 Jul FX Reserves - Kenya Foreign currency reserves at record highs of Kshs 779billion (US$ 7.79million) equivalent to 5.5 times the country s monthly import bill as at Mid-July. This gives a significant cushion to the shilling Months of Import Cover Desired Minimum Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Mid Jul Key reasons for increase in reserves are: i. Lower oil prices ii. Increasing exports and inflow from tourism iii. Increasing diaspora remittances iv. Increasing Foreign Direct Investments 6 6 3

4 1 Current Account balance as a % of GDP - Kenya Low global oil prices in and part of supported Kenya to improve on the deficit In Percent CBK expects the Current Account deficit to narrow to 5.5% of GDP in 7 1 Current Account balance as a % of GDP East Africa In Percent Tanzania DRC Rwanda Uganda Source: IMF 8 4

5 1 East Africa s Inflation Kenya East African Peers The latest inflation figure as at end of June was 5.8% (down from 8.0% since start of the year) due to: - Food prices (food index is down due to the rains) - Low fuel prices Uganda Tanzania Rwanda DRC % 6.5% 5.8% % 6.5% 3.8% 5.4% 4.6% 6.2% 5.9% 5.5% 5.5% % 2.0% 2.1% 2.2% 2.2% Jan-16 Mar-16 Jun Jan-16 Mar-16 Jun-16 Source: Trading Economics 9 1 Interest Rates - Kenya Due to the high liquidity in the market, interest rates have been dropping since the beginning of February Political and Economic Sep-Oct review in the region Peak Oct Nov Dec Jan Feb Mar Apr May June July Interbank rate 25.84% 14.87% 8.77% 5.19% 6.13% 4.51% 4.09% 3.88% 3.80% 4.48% 5.70% 91 Days T. Bill 21.35% 22.13% 9.21% 10.41% 11.76% 9.32% 8.41% 8.77% 7.71% 7.06% 7.92% 182 Days T. Bill 21.61% 22.29% 10.09% 12.34% 14.18% 11.93% 10.66% 10.69% 10.00% 9.24% 10.21% 364 Days T. Bill 21.50% 22.36% 11.93% 12.75% 14.92% 13.25% 11.91% 11.80% 11.29% 10.74% 11.03% Source: Central Bank of Kenya CBR Rate remains at 10.5% In July the MPC reviewed KBRR downwards by one percentage point to 8.90% down from 9.87% 10 5

6 1 Interest Rates East Africa Uganda Political and Economic Sep Oct review Nov in the Dec region Jan Feb Mar Apr May June July Interbank rate 13.40% 12.93% 12.87% 14.06% 12.98% 12.46% 11.53% 12.42% 12.84% 14.16% 13.91% 91 Days T. Bill 16.68% 18.75% 18.33% 17.60% 18.22% 18.70% 15.07% 13.69% 13.54% 13.88% 14.33% 182 Days T. Bill 17.69% 19.64% 19.50% 19.55% 19.79% 20.05% 16.65% 14.13% 14.30% 14.77% 14.38% 364 Days T. Bill 17.66% 19.11% 18.33% 18.54% 19.74% 19.15% 14.44% 13.64% 13.91% 14.92% 14.81% Source: Bank of Uganda Political Rwanda and Economic review in the region Sep Oct Nov Dec Jan Feb Mar Apr May June July Interbank rate 3.67% 3.45% 3.45% 3.73% 4.93% 4.80% 5.18% 5.60% 5.92% 5.93% 5.93% 91 Days T. Bill 3.68% 4.17% 4.16% 4.66% 9.98% 5.89% 5.78% 5.81% 6.05% 6.17% 6.38% 182 Days T. Bill 364 Days T. Bill 4.47% 4.80% 5.51% 5.37% 6.18% 6.25% 6.13% 6.23% 6.27% 6.56% 6.75% 6.40% 6.52% 6.72% 8.10% 8.21% 8.46% 8.32% 8.37% 8.57% 8.85% 8.99% Source: National Bank of Rwanda 11 1 Interest Rates East Africa Tanzania Interbank rate Sep Oct Dec Jan Feb Mar Apr May 6.62% 12.40% 7.29% 12.02% 13.31% 10.39% 11.17% 12.32% 91 Days T. Bill 8.28% 9.49% 9.28% 9.02% 8.78% 8.59% 8.15% 7.98% 182 Days T. Bill 364 Days T. Bill 13.77% 17.75% 17.15% 17.67% 17.79% 17.08% 15.78% 14.86% 14.45% 15.49% 18.72% 18.81% 18.96% 17.83% 16.62% 15.50% Source: Bank of Tanzania 12 6

7 1 East Africa GDP Growth & Projections Kenya s GDP growth rate maintained an upward growth rate with an increasing momentum while the rest of Africa is experiencing declining growth rate. Kenya s Gross Domestic Product (GDP) is estimated to have expanded by 5.6% in which was a slight improvement compared to a 5.3% growth in Kenya s GDP growth rate is projected to rise to 5.9% in and 6.1 % in 2017 predicated on infrastructure investments. Fiscal consolidation is expected to ease pressure on domestic interest rates and increase credit uptake by the private sector. The contraction in the current account deficit will continue to be supported by declining commodity prices and rising exports of tea. Kenya Tanzania Uganda South Sudan P 2017P 2018P P 2017P 2018P Source: World Bank East Africa s Economy Stable macro-economic environment in the East African region (interest rates, inflation, stable exchange rates) and converging macro-economic drivers Economic growth continues to be higher in the East African region compared to the rest of Africa Significant investment in infrastructure in the East African region Significant mineral resources findings mining, oil & gas More diversified economies in the East African region that are politically stable The central banks of Kenya and Uganda reduced their bench mark rate by 100bp in, while the central banks of Tanzania and Rwanda chose to maintain a neutral monetary policy

8 1 Head Winds The ramifications of Brexit The sluggish and declining growth rates of China The politics and elections in 2017 in Kenya, the uncertainty of the Peace Settlement in South Sudan, and the impending elections in DRC The challenges in the financial sectors reflected by the failure of 3 institutions over the last year Threat from interest rate capping H2 Strategic Priorities Increased focus on Innovation and Digitization Strengthening focus on SME Greater focus on balance sheet structure to make the Group agile and responsive to changing opportunities landscape Processes optimization to transform service delivery Channel optimization and customer experience Cost optimization to deliver lower cost to income ratio

9 Presentation Outline 1. Macro-economic overview 2. Governance & leadership structure 3. Regional expansion and diversification 4. Innovation & digital banking 5. SME strategy 6. Qualitative analysis 7. Social Impact 8. Performance of core business (intermediation) 9. Financial performance 17 2 Strong Governance & Leadership Structure CBK CMA NSE Rating Agencies Equity Group Holdings Limited Shareholders Subsidiary Boards Group Board Subsidiary Boards Board Committees Subsidiary Internal Audit Group Internal Auditor Group Board Committee CEO CEO s office Director Governance, Strategy, Legal, Company Secretary Chief Officer, Finance, Innovation, Payments Director Brand, Culture and HR Board Committees Subsidiary Internal Audit Non-Banking Subsidiaries Corporate Office Banking Subsidiaries Equity Group Foundation Equity Investment Bank Equity Insurance Agency Consulting Infrastructure Services Group Director, Investor Relations Chief Technology & Information Officer Group Director, Treasury Group Director, Special Projects Group Director, Analytics Group Chief Operating Officer Group Director, Finance Chief Risk and Compliance Officer Group Director Strategic Relations &Partnerships Group Director, Corporate Banking Group Director, SME Banking Kenya Rwanda Tanzania Uganda South Sudan ProCredit Bank DRC Each subsidiary with own Board of Directors compliant with local regulations 18 9

10 Presentation Outline 1. Macro-economic overview 2. Governance & leadership structure 3. Regional expansion and diversification 4. Innovation & digital banking 5. SME strategy 6. Qualitative analysis 7. Social Impact 8. Performance of core business (intermediation) 9. Financial performance 19 3 Extracting Value From Subsidiaries Key Metrics for Banking Subsidiaries KES Billion Tanzania Rwanda Uganda S. Sudan DRC Regional Total Regional Contribution Kenya Regional Contribution Deposits % 22% Deposits Growth -10% 34% 19% -69% 24% 2% 10% Loan % 13% Loan Growth 11% 17% 3% -91% 45% 48% 8% Assets % 22% Asset Growth 7% 4% 14% -65% 34% 9% 13% PBT PBT Growth % % % % % % % 5% 8% Kenya column above represents all entities in Kenya 20 10

11 3 Extracting Value From Subsidiaries (Deposits and Loans contribution by countries) Deposits split by Country Loans split by Country DRC Rwanda Uganda Tanzania S. Sudan 100.0% 0.0% 2.6% 3.5% 4.9% 11.0% 100.0% 6.4% 3.3% 3.9% 4.1% 3.2% DRC S. Sudan Uganda Rwanda Tanzania 100.0% 0.0% 1.6% 3.1% 3.1% 5.6% 100.0% 5.8% 0.1% 2.8% 3.2% 5.4% Kenya 78.0% 79.2% Kenya 86.7% 82.6% H2 H2 H2 H Extracting Value From Subsidiaries (Assets and PBT contribution by countries) Total Assets split by Country PBT split by Country DRC Rwanda Uganda Tanzania 100.0% 0.0% 3.2% 3.7% 4.9% 100.0% 6.5% 3.7% 4.7% Uganda Tanzania Rwanda S. Sudan 100.0% 0.4% 0.0% DRC 1.6% 1.8% 3.8% 100.0% 1.7% 1.6% 1.2% 1.1% S. Sudan 9.8% 3.0% 3.0% Kenya 78.4% 79.0% Kenya 92.4% 94.8% -0.4% H2 H2 H2 H

12 3 Deposits Growth In KES billions Kenya DRC Tanzania Uganda Rwanda S. Sudan 10% % % % % % 10.3 Consolidated Consolidated w/o S. Sudan % % Presentation Outline 1. Macro-economic overview 2. Governance & leadership structure 3. Regional expansion and diversification 4. Innovation & digital banking 5. SME strategy 6. Qualitative analysis 7. Social Impact 8. Performance of core business (intermediation) 9. Financial performance 24 12

13 4 +271% 97.8 Execution on Digital Banking (Disruptive shift to variable deliverable channels) Variable cost channels Transaction numbers in millions +24% Fixed cost channels % % % 10.9 Equitel Agency Merchants ATM Branch Transaction value in KES billion -9% +811% % % % Execution on Digital Banking (Impact on channel use) Transactions (Millions) 100 Mobile Agency ATM Branch 0 Q Q Q Q2 Q

14 4 Equity Kenya Channel Market Share Trend Branch ATM Merchants Agents 59% 49% 52% 42% 40% 44% 40% 26% 26% 25% 21% 23% 29% 21% 23% 11% 10% 10% 12% 15% 12% 12% 12% 11% Execution on Digital Banking (Equitel customer numbers up 115% growth YoY) KES 000 Linkage to M-Banking SIM uptake +115% 2,250 2,000 1,750 1,500 1,250 1, ,024 87% 1,085 1,166 1,178 86% 87% 85% 1,369 88% 1,500 89% 1,591 89% 1,665 90% 1,760 90% 1,861 90% 1,963 91% 2,072 92% 2,196 92% 2,250 2,000 1,750 1,500 1,250 1, Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun

15 4 Execution on Digital Banking (Mobile Customer Transaction Numbers & Value Trend) Cumulative M-Banking Transactions numbers (millions) Cumulative M-Banking Value (KES billions) % 525% Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Execution on Digital Banking (Count of loan disbursements through Mobile vs. Branch) In Thousands Mobile Mobile Branch 5,600 5,200 4,800 4,400 4,327 4,000 3,600 3,200 2,944 3,270 3,640 3,981 2,800 2,400 2,000 1,600 1, , (64%) 378 (36%) Jul 1, (66%) 412 (34%) Aug 1, (68%) 449 (32%) Sep 1,659 1,174 (71%) 485 (29%) Oct 1,981 1,450 (73%) 531 (27%) Nov 2,337 1,764 (75%) 573 (25%) Dec 2,629 2,017 (77%) 612 (23%) Jan 2,297 (78%) 646 (22%) Feb 2,591 (79%) 679 (21%) Mar 2,927 (80%) 713 (20%) Apr 3,238 (81%) 743 (19%) May 3,558 (82%) 769 (18%) Jun +308% Cumulative 30 15

16 4 Execution on Digital Banking (KES 20.8 billion disbursed through Mobile Channel with KES 5.6 billion outstanding) Disbursement Count (number) Loan Value Disbursement (KES "Billion") Eazzy Loan Volume Outstanding 683,174 +6,470% 3,557, % Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May 16 Jun 16 Jul 15 Aug 15 Sep 15 Oct 15 Nov 15 Dec 15 Jan 16 Feb 16 Mar 16 Apr 16 May 16 Jun 16 Cumulative figures 31 4 Execution on Digital Banking (Loan Repayments) 32 16

17 4 Continuous Growth in Agency Banking Focus on Variable cost model More transactions now processed under 3 rd party infrastructure saving on fixed costs Number of agents increased to 26,593 agents. 26% growth y/y Transactions (Millions) Agency % Agent transactions registered a 24.3% growth More transactions now processed under 3rd party infrastructure Q Q Q Q2 ATM Branch Q Number and Value of Agents Transactions Transactions in million Value in billion kes Jun Sept Dec Mar 2012 Jun Sept Dec 2012 Mar Jun 2013 Sept Dec Mar Jun Sept Dec 2014 Mar Jun Sept Dec Mar Jun

18 4 Number of Merchants Outlets ,063 7,749 8,371 8,517 6,864 5,166 5,618 6,153 4,412 1,519 2,018 1,658 2,139 2,346 2,668 2,824 3,066 3,720 3,499 Mar 2012 Jun 2012 Sept 2012 Dec 2012 Mar 2013 Jun 2013 Sept 2013 Dec 2013 Mar 2014 Jun 2014 Sept 2014 Dec 2014 Mar Jun Sept Dec Mar May June 35 4 We are building on our momentum in Payment Processing and Merchants We have partnered with key payment companies which has allowed us to grow our number of transactions and commissions Volume (Millions) Commissions (Millions) +59% 16, % 22,296 10, % Equity is leading in Acquiring and Issuing Best in class payment channel services work well with merchants Merchant Transaction Volumes +57% Merchant Commissions 36 18

19 Presentation Outline 1. Macro-economic overview 2. Governance & leadership structure 3. Regional expansion and diversification 4. Innovation & Digital banking 5. SME strategy 6. Qualitative analysis 7. Social Impact 8. Performance of core business (intermediation) 9. Financial performance 37 5 Effect of SME s on Loans & Deposits Deposits Loans In Billion Term deposits (19%) +7% (24%) Agriculture Consumer Micro 100.0% 2.9% 22.0% 100.0% 2.8% 21.4% 6.7% 5.6% Savings (42%) (42%) SME 68.4% 70.2% Current Accounts (39%) (34%) 38 19

20 Presentation Outline 1. Macro-economic overview 2. Governance & leadership structure 3. Regional expansion and diversification 4. Innovation & digital banking 5. SME strategy 6. Qualitative analysis 7. Social Impact 8. Performance of core business (intermediation) 9. Financial performance 39 6 Equity has earned recognition in Equity s International Rankings Overall Soundness (Capital Assets Ratio) Performance (Profits on capital) (Return on assets) Global Rank Global Rank Equity s Global Credit Rating Aug 40 20

21 6 Equity has earned recognition in EQUITY BEST BANK IN KENYA FOR 4TH TIME Category 1st 2nd 3rd Best Overall Bank Best Bank Tier 1 (Big Banks) Best Bank in SME Banking Best Bank in Retail Banking Best Microfinance Bank Best in Agency Banking Best in Asset Finance Best Bank in Mortgage Finance Product Marketing Best in Internet Banking Best in Mobile Banking Fastest Growing Bank Best in Customer Satisfaction 41 6 Think Business Awards Equity has earned substantial accolades in 42 21

22 6 Banker Awards Equity has earned substantial accolades in 43 6 Euromoney Awards Equity has earned substantial accolades in 44 22

23 6 Market Capitalization (as at 30 th June ) In KES billion s market capitalization constitutes 25% of the total market value of the 11 banks listed on the NSE Equity KCB Stanchart Coop BBK DTB I&M CfC NIC Stanbic HF NBK Source: B.D 45 Presentation Outline 1. Macro-economic overview 2. Governance & leadership structure 3. Regional expansion and diversification 4. Innovation & Digital banking 5. SME strategy 6. Qualitative analysis 7. Social Impact 8. Performance of core business (intermediation) 9. Financial performance 46 23

24 6 EGF 7 Programmatic Pillars Cash transfers Fanikisha Fanikisha+ (Tanzania) Financial Knowledge for Africa training programme EGF 7 Programmatic Pillars 7 Financial Inclusion and Literacy 1 Education and Leadership Development Wings to Fly Equity African Leaders Programme Forest restoration Energy program 6 Environment Monitoring and evaluation 2 Agriculture Transforming smallholder farmers Accelerating medium size farms Wings to Fly Learning Equitel - MY LIFE Equity Afia Innovation 5 4 Health Entrepreneurship 3 Entrepreneurship training program 47 6 Championing Social-Economic Revolution TOTAL WINGS TO FLY SCHOLARS 12, ,303 MSMEs trained 3,405 UNIVERSITY SCHOLARS Attending 329 universities globally Content availed through mobile channels Secondary School Revision Content availed WtF scholars MAMA for Mothers Financial Education Wikipedia WtF Graduating Performance 3,578 WtF Scholar graduate from 2010,2011,2012 Classes 98% secondary school completion 93% of WtF achieving university grade 32% achieving A grade at KCSE 86% take on school and community leadership roles USD 221,890,909 TOTAL FUNDS RAISED SINCE 2010 FOR PROGRAMS PEASANT FARMERS TRANSFORMED TO 500,000 AGRI-BUSINESSES KES 2,400 MEDIUM-SIZED FARMERS SUPPORTED 14,000 1,270,871 WOMEN & YOUTH 32B 18B Kenyans reached with Renewable Energy products Kenyan women and youth completed the financial literacy education. Loans to empower women under Fanikisha Loans given to empower the youth 48 24

25 Presentation Outline 1. Macro-economic overview 2. Governance & leadership structure 3. Regional expansion and diversification 4. Digital bank 5. SME strategy 6. Qualitative analysis 7. Social Impact 8. Performance of core business (intermediation) 9. Financial performance 49 8 Funding Base (Proactive management of a quality balance sheet in a challenging environment) In KES Billion 11% (2%) Other Liabilities 7.9 (9%) 27.1 (2%) Borrowed Funds (7%) 75.4 Shareholders Funds 65.0 (17%) (16%) Growth per Funding Type 2% 48% 16% Deposits (75%) (72%) 7% 50 25

26 8 Deposits & Deposit Accounts In Billion Deposits Loan & Deposits Accounts In Million Number of Deposit Accounts Term Deposits (19%) +7% (24%) Savings (42%) (42%) Current Accounts (39%) (34%) Mar 15 Jun 15 Sep 15 Dec 15 Mar 16 Jun Effect of South Sudan on Deposits Growth In KES Billion With South Sudan In KES Billion Without South Sudan % %

27 8 Assets of KSH 444 Billion driven by stable Deposit base In KES billion 11% Growth per Asset Class Other Assets Government Securities Cash & Cash Equivalents (12%) 50.6 (13%) 66.3 (17%) (10%) 73.0 (16%) 59.8 (13%) -10% 44% -10% Net Loans (59%) (61%) 14% 53 8 Effect of South Sudan on Assets Growth In KES Billion With South Sudan In KES Billion Without South Sudan % %

28 8 Equity Kenya continues to gain market share Deposits Market Share Loans Market Share Assets Market Share 10.8% 10.7% 8.2% 8.2% 8.2% 8.8% 9.5% 9.5% 9.2% 9.4% 9.9% 10.0% 8.8% 9.3% 8.8% 8.7% 9.8% 9.7% Q Q Q1 8 Equity vs Sector NPL Trend over time EBKL Group Sector 7.8% 8.2% 6.8% 5.7% 5.4% 4.4% 4.1% 4.5% 4.1% 3.3% 2.9% 3.8% 3.5% 4.6% 4.2% Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Q2 sector data is as at Apr 56 28

29 8 Non-Performing Loans: High Coverage Levels Sector (Spec. Prov. + Int. Susp) / Gross NPL Equity (Spec. Prov. + Int. Susp) / Gross NPL Equity (Gen. Prov. + Spec. Prov. + Int. Susp) / Gross NPL 88.0% 92.8% 84.0% 79.0% 64.5% 60.6% 55.2% 56.0% 53.9% 50.2% 48.5% YE 2014 YE Q1 Sector data for not yet available 57 8 Cost to Income Ratio Trend Group Bank 49.9% 46.7% 49.0% 44.8% 49.7% 46.0% 51.4% 47.4% 49.6% 43.6% Total Operating Income up 22% y/y mainly attributed to improved NIM Operating expenses up 26% y/y mainly attributed to growth in loan loss provisions 58 29

30 8 RoAA and RoAE Trend RoAE EBKL Group 35.0% 35.9% 26.6% 27.3% RoAA EBKL Group 5.1% 4.6% 5.2% 4.6% 59 Presentation Outline 1. Macro-economic overview 2. Governance & leadership structure 3. Regional expansion and diversification 4. Digital bank 5. SME strategy 6. Qualitative analysis 7. Social Impact 8. Performance of core business (intermediation) 9. Financial performance 60 30

31 9 Broad base liabilities & funding sources Growth Y/Y Liabilities & Capital (Bn) KSH KSH % Deposits % Borrowed Funds % Other Liabilities % Shareholders Funds % Total Liabilities & Capital % Funding Distribution Shareholders Funds 16% Other Liabilities 2% Borrowed Funds 7% Shareholders Funds 17% Other Liabilities 2% Borrowed Funds 9% 75% Deposits 72% Deposits 61 9 Asset Portfolio & Distribution Growth Y/Y Assets (Bn) KSH KSH % Net Loans % Cash & Cash Equivalents % Government Securities % Other Assets % Total Assets % Asset Distribution Other Assets Other Assets 12% 10% Government Securities 13% Government Securities 16% 17% Cash & Cash Equivalents 59% Net Loans 13% Cash & Cash Equivalents 61% Net Loans 62 31

32 9 Delivering 18% growth in PAT KES (Billion) Growth Interest Income % Interest Expense (3.8) (4.9) 29% Net Interest Income % Non-Funded Income % Total Income % Loan Loss Provision (0.7) (1.9) 182% Staff Costs (5.1) (6.1) 19% Other Operating Expenses (8.4) (9.8) 17% Total Costs (14.2) (17.9) 26% PBT % Tax (3.5) (4.1) 17% PAT % 63 9 PBT Growth In KES Billion With South Sudan In KES Billion Without South Sudan 18% 23%

33 9 Positive Financial Ratios Kenya Kenya Group Group Profitability NIM 10.9% 12.5% 9.8% 11.7% Cost to Income Ratio (with provisions) 49.0% 48.6% 54.0% 55.6% Cost to Income Ratio (without provision) 47.5% 43.6% 51.4% 49.6% RoAE 35.0% 35.9% 26.6% 27.3% RoAA 5.1% 5.2% 4.6% 4.6% Asset Quality Cost of Risk 0.34% 1.00% 0.61% 1.43% Liquidity / Leverage Loans / Deposits 86.3% 85.3% 78.7% 83.9% Loans / (Deposits + Borrowed Funds) 77.4% 74.6% 72.2% 74.5% Loans / (Deposits + Borrowing Funds + S/H Funds) 65.6% 63.1% 60.2% 61.6% Liquidity 28.0% 39.9% 31.0% 37.0% Capital Adequacy Ratios Core Capital to Risk Weighted Assets 14.6% 14.4% 17.7% 18.7% Total Capital to Risk Weighted Assets 16.6% 15.6% 18.3% 19.8% Core Capital to Deposits Ratio 18.4% 18.9% 20.4% 23.4% 65 THANK YOU Dr James Mwangi, CBS Group Managing Director & CEO info@equitybank.co.ke Web site: