FGB Investor Presentation

Transcription

1 FGB Investor Presentation May/June /40

2 Disclaimer This presentation provides information in summary form only and is not intended to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. No presentation,express or implied, is made as to the fairness accuracy, completeness or correctness of information contained in this presentation, including the accuracy, likelihood of achievement or reasonableness of any forecasts, prospects, synergies, returns, benefits or statements in relation to future matters contained in the presentation. The forward-looking statements are by their nature subject to significant uncertainties and contingencies and are based on numbers or estimates or assumptions that are subject to change (and in many cases are outside the control of FGB and its directors) which may cause the actual results or performance of FGB to be materially different from any future results or performance expressed or implied by such forward looking statements. To the maximum extent permitted by law, FGB disclaims any responsibility for the accuracy or completeness of any information contained in this presentation including any forward-looking statements and disclaims any responsibility to update or revise any information or forward-looking statement to reflect any change in FGB s financial condition, status or affairs or any change in the events, conditions or circumstances on which a statement is based. To the maximum extent permitted by law, neither FGB nor its related bodies corporate, directors, employees or agents, nor any other person, accepts any liability, including, without limitation, any liability arising from fault or negligence, for any direct, indirect or consequential loss arising from the use of this presentation or its contents or otherwise arising in connection with it. Please note that rounding differences may appear throughout this presentation. This presentation should be read in conjunction with other publicity available material. Further information including historical results and a description of the activities of FGB is available on our website, 2/40

3 Contents Operating Environment FGB Profile Q1 15 Performance Review 3/40

4 Operating Environment FGB Profile Q1 15 Performance Review UAE Economic Overview SOLID FUNDAMENTALS UAE federation was established in 1971 and comprises of seven Emirates Politically stable country and highly favorable business climate Second largest economy in the GCC; Total population estimated at 9.3 Million 7 th largest oil reserves in the world (92 Bn boe) FY15 nominal GDP estimated at USD 364Bn 2015e and 2016e Real GDP growth both seen at 3.2%¹, down from 3.6% in 2014 due to lower oil prices According to the IMF, UAE fiscal deficit could reach 3.7% and 0.5% of GDP in 2015e and 2016e respectively before returning to surplus in 2017 UAE GDP BREAKDOWN BY SECTOR² % REAL GDP GROWTH (YOY % CHANGE) Real GDP Growth Oil Real GDP Growth Non-Oil Real GDP Growth e 2016e -2 Source: IMF BUDGET BALANCE (AS % GDP) Government Services 1% Real Estate & Business Services 10% Transport 8% Other 2% Finance 7% Trade, Restaurant & Hotels 12% ¹IMF statistic as of April 2015 ²UAE National Bureau of Statistics, 2013 GDP Agriculture 1% Mining & Quarrying 39% Construction 9% Electricity, Gas, Water 2% Manufacturing 9% % e 2016e Source: IMF 4/40

5 Operating Environment FGB Profile Q1 15 Performance Review Abu Dhabi Economic Overview ABU DHABI AT A GLANCE Largest Emirate in the UAE accounting for more than 80% of the country s total land area Abu Dhabi Nominal GDP estimated at USD 261.6Bn in FY14e 1, that s 63% of UAE overall nominal GDP 51.4% of 2013 GDP generated from the hydrocarbon sector Major non-oil GDP contributors include: construction and real estate, manufacturing, logistics, and wholesale and retail trade Transition underway towards a more diversified economy with a particular focus on the infrastructure and services sectors inline with Abu Dhabi Plan 2030 Ras al-khaymah Umm al-quwayn Sharjah Dubai Ajman ABU DHABI Fujairah ABU DHABI - KEY STATISTICS Economic Structure and Performance e 2015f Government Finance e 2015f Nominal GDP (USD Bn) Nominal GDP (% change) Real GDP (% change) Inflation Rate (CPI, % change) Gen. Gov Revenue/GDP (%) Gen. Gov Expenditures/GDP (%) Gen. Gov. Financial Balance/GDP (%) Gen. Gov. Debt/GDP (%) Crude Oil Export Price (avg USD/b) Source: Moody s Credit Analysis Report on Government of Abu Dhabi published on 26 January Source: Statistics Center Abu Dhabi (SCAD) 5/40

6 Operating Environment FGB Profile Q1 15 Performance Review UAE and the oil price shock SIZEABLE ASSET BUFFERS TO WITHSTAND OIL PRICE DROP GCC Country SWF Assets/General Gvt Expenditure (Years) Kuwait 7.6 UAE 5.1 Qatar 4.7 Saudi Arabia 2.7 Oman 1.7 Bahrain 1.2 Source: Resilience to Lower Oil Prices Varies; Bahrain and Oman most exposed, Moody s Dec 14 EIBOR/ LIBOR SPREAD UAE PMI 1 ABOVE THE 50-MARK 56.8 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 Source: Markit/HSBC OIL PRICE/ UAE NOMINAL GDP M LIBOR (%) M LIBOR 3M EIBOR 3M EIBOR (%) USD/bl Crude Oil Price USD (USD) UAE Nominal GDP USD (USD Bn Bn) USD Bn 0.2 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar Source: Bloomberg Source: IMF 1 UAE Purchasing Manager Index is a composite indicator designed to provide an overall view of activity in the UAE s non-oil private sector economy. The indicator is derived from individual diffusion indices which measure changes in output, new orders, employment, suppliers delivery and stocks of goods purchased. 6/40

7 Operating Environment FGB Profile Q1 15 Performance Review Plan Abu Dhabi 2030 ENERGY Masdar City Masdar City - the world s first carbon neutral, zero-waste to landfill, car-free city powered entirely by alternative energy sources. Masdar Institute an institute developed with Massachusetts Institute of Technology (MIT) with the aim to develop the emirate s human capital and develop research in alternative energies. Masdar City AVIATION, AEROSPACE & DEFENCE Strata is a composite aero structures manufacturing facility, wholly-owned by Mubadala, which has formed partnerships with a number of leading aerospace companies to establish manufacturing programs at a new plant in Al Ain. Strata TOURISM Entertainment Yas Marina Circuit Ferrari World Abu Dhabi Yas Waterworld Abu Dhabi Al Ain Wildlife Park Shopping malls EDUCATION Hotels Etihad Towers Emirates Palace St. Regis Abu Dhabi Rocco Forte Hotel Qasr Al Sarab Desert Resort Ritz-Carlton Abu Dhabi Eastern Mangroves Hotel Universities: Paris Sorbonne Abu Dhabi, New York University, and Zayed University Emirates Palace Zayed University Etihad Towers Paris Sorbonne Ferrari World Abu Dhabi Yas Marina Circuit New York University HEALTHCARE, EQUIPMENT & SERVICES Cleveland Clinic Abu Dhabi will offer a 364-bed hospital organized into five institutes, digestive disease, eye, heart & vascular, neurological, respiratory and critical care. Source: Abu Dhabi Council for Economic Development (June 2012) Cleveland Clinic 7/40

8 Operating Environment FGB Profile Q1 15 Performance Review Abu Dhabi in the GCC context LT Ratings (Moody s, S&P, Fitch) Oil Production (1) GDP Per Capita (2) Abu Dhabi Aa2, AA, AA 3.0mn bpd+ USD 74,927 Saudi Arabia Aa3, AA-, AA 11.5mn bpd + USD 20,677 Kuwait Aa2, AA, AA 3.1mn bpd + USD 44,032 Qatar Aa2, AA, NR 2.0mn bpd + USD 81,603 Bahrain Baa2 (-), BBB, BBB 0.4mn bpd + USD 28,707 Oman A1, A, NR 0.9mn bpd + USD 14,887 1 Source: BP Statistical Review of World Energy (June 2014) forecasts - Source: 2014 IMF data for all, except Abu Dhabi (Moody s) Note: Unless otherwise indicated, all outlooks are stable; (-) Negative outlook 8/40

9 Operating Environment FGB Profile Q1 15 Performance Review UAE Banking Sector Landscape OUTLOOK KEY INDICATORS 1 UAE Banking sector comprises 51 banks (23 local, 28 foreign) Strong track record of systemic support as evident through the measures taken at the onset of the financial crisis As of Mar 15, system L/D ratio stood at 91% implying a system-wide net deposit surplus of AED 135Bn (USD 37Bn) Loan book grew 2.4% YTD (+AED 31.4Bn) as of Mar 15 while customer deposits added 2% YTD (+AED 28Bn) Banking sector loan book is expected to record mid-single digit YoY growth in 2015, down from 9% in 2014 Figures in AED Bn Mar 15 YTD Change YoY Change Total Assets, net 2, % 10.0% Loans and Advances, net 1, % 9.5% Customer Deposits 1, % 8.8% LDR 91% +100bps +100bps CAR 18.2% - - Tier 1 capital 16.2% - - SYSTEM DEPOSIT SURPLUS AT AED 135BN AS OF MAR 15 SYSTEM LOAN-TO-DEPOSIT RATIO % 108% % 100% AED Bn 50 0 (50) Dec'03 Dec'04Dec'05Dec'06 Dec'07Dec'08 Dec'09Dec'10 Dec'11Dec'12Dec'13 Dec'14Mar'15 (17) (1) (35) 95% 90% 85% 91% (100) 1 Source: UAE Central Bank (71) 80% Dec'03Dec'04Dec'05Dec'06Dec'07Dec'08Dec'09Dec'10Dec'11Dec'12Dec'13Dec'14Mar'15 9/40

10 Operating Environment FGB Profile Q1 15 Performance Review FGB Summary Profile Leading UAE franchise; #1 UAE bank by net profit in FY 14 for the second consecutive year and #3 by total assets; 11% and 10% market shares in loans and deposits respectively. Superior fundamentals in terms of growth, NIMs, cost efficiency, asset quality and profitability Strong Credit Ratings: A2 by Moody's and A+ by Fitch Comfortable liquidity position and access to multiple funding channels Strong risk management culture and stable management team Business model re-aligned to drive sustainable value creation Robust capital position: Basel II total CAR at 18.0% and Tier 1 capital ratio at 16.8% as of Mar 15 10/40

11 Operating Environment FGB Profile Q1 15 Performance Review An impressive journey of consistent growth and value creation over the past 15 years Net Profit (in AED Mn) Total Assets (in AED Bn) Market Cap (in AED Bn) '14 '13 '12 '11 '10 '09 '08 '07 '06 '05 '04 '03 '02 '01 ' ,656 '14 '13 '12 '11 '10 '09 '08 '07 '06 '05 '04 '03 '02 '01 ' Feb'15 Apr 15 x113 x88 '07 x123 '14 '13 '12 '11 '10 '09 '08 '06 '05 '04 '03 '02 '01 ' ,000 4,000 6, Source: FGB, Bloomberg

12 Operating Environment FGB Profile Q1 15 Performance Review A story of superior returns to shareholders FGB added superior long term value to shareholders by consistently outperforming benchmark indices Total Shareholder Return (TSR*) FGB ADSMI DFMGI 1-year 23% 9% 18% 3- year 235% 117% 218% 5-year 262% 103% 155% 15 FGB TRI ADSMI TRI (rebased) DFMGI TRI (rebased) Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec-14 Source: Bloomberg *Based on the Total Return Index which captures share price appreciation and dividends paid. Period cut-off date: 31/12/2014

13 Operating Environment FGB Profile Q1 15 Performance Review FGB Overview A LEADING UAE FRANCHISE OWNERSHIP STRUCTURE* (AS OF MAR 15) Incorporated in 1979 and headquartered in Abu Dhabi Wide range of financial products and services offered through a network of 21 branches in the UAE. In addition, FGB is present through branches in Doha and Singapore, and rep offices in Mumbai, Hong Kong, Seoul and London. The Bank also has a JV in Libya. 1,496 employees Listed in 2002; Market cap of AED 69Bn (USD 18.8Bn) as of April 29 th, 2015 UAE companies and individuals 87.6% Foreign Investors 10.1% GCC (ex- UAE) 2.3% * FGB s Foreign Ownership Limit (FOL) is at 25% RATINGS GLOBAL FOOTPRINT LONG TERM RATING OUTLOOK London A2 (Since 2007) A+ (Since 2007) Stable Stable FGB-Libya Tripoli Doha UAE Mumbai Hong Kong Singapore Seoul A+ Stable 21 branches in the UAE and 2 branches overseas 4 Rep Offices 1 Subsidiary 13/40

14 Operating Environment FGB Profile Q1 15 Performance Review History & Key Milestones New rep offices in London and Seoul - Maintained position of #1 UAE Bank by Net Profit at USD 1.54Bn Acquisition of Aseel and Dubai First -FGB becomes the #1 UAE Bank in terms of net profit with USD 1.3Bn 2012 New office in Hong Kong 2011 Net profit crossed the USD 1Bn mark 2009 New offices in Qatar and India 2007 First overseas office in Singapore Introduction of Islamic banking services - Rated A by Fitch (followed by A+ in 2007) and A2 by Moody s 2005 Net profit crosses the AED 1Bn (USD 272 Mn) mark 2002 Listing on Abu Dhabi Exchange 2001 New vision, brand identity and introduction of new business segments: Retail and Treasury & Investments Abu Dhabi ruling family acquires 45% stake and designates new management team 1979 FGB is incorporated in Ajman with an initial focus on Corporate Banking 14/40

15 Operating Environment FGB Profile Q1 15 Performance Review H.H. SHEIKH TAHNOON BIN ZAYED AL NAHYAN CHAIRMAN CHAIRMAN OF AMIRI FLIGHT CHAIRMAN OF ROYAL GROUP ABDULHAMID MOHAMMED SAEED BOARD MEMBER FGB MANAGING DIRECTOR Board Member of: Emirates Investment Authority Mubadala Development Company 15/40

16 Operating Environment FGB Profile Q1 15 Performance Review Corporate Governance Strong & Independent Governance framework covering all material risks across the Group Board of Directors Board Committees Executive Committee Remuneration & Nomination Committee Risk & Compliance Management Committee Audit Committee Executive Management Committee Management Committees Wholesale Banking Credit Committee First Gulf Credit Committee Asset Liability Committee Investment Committee Compliance & Ops Risk Committee IT Steering Committee HR Steering Committee Real Estate Committee Enterprise Risk Management Group ERM Group CRO Head of Enterprise Risk Management Credit Risk Market Risk ALM Risk Operational Risk Compliance Risk Basel II / III 16/40

17 Operating Environment FGB Profile Q1 15 Performance Review Business Segments Core Banking Revenue Drivers Incremental Revenue Streams WHOLESALE BANKING CONSUMER BANKING TREASURY & GLOBAL MARKETS SUBSIDIARIES & OTHER % of Assets % of Revenue % of Assets % of Revenue % of Assets % of Revenue % of Assets % of Revenue 44% 35% 24% 37% 21% 15% 11% 13% Original core business of the Bank Customer base includes large corporate & multi-national clients and financial institutions Services include debt markets (advisory, bilateral, & syndicated loans, DCM, project and structured finance), transaction banking (cash, trade, liabilities), Corporate Finance, and Islamic Finance (bilateral trading, trade finance) supported by treasury sales (hedging, FX, rates, commodities) Organized geographically across UAE and international locations (Singapore, Libya, Hong-Kong, Qatar, India, UK and South Korea) Focus on key customer segments: Emirati, Mass, SME, Wealth Leverage product innovation, analytics, and alliances to create differentiation Investing for the future and enhancing customer experience through technology and process improvements Positioning as Bank of Choice for UAE Nationals Manage National Housing Loan program for Abu Dhabi government Manages FGB s wholesale funding activities and liquidity, interest rate and foreign exchange risk, and proprietary investment portfolio Provides bespoke risk management solutions to the Bank s clients across FX, Interest Rate, Credit and Commodity asset classes Also provides client investment solutions via structured products, asset management, equity brokerage and margin trading Strong growth opportunities providing an access point to the global markets by leveraging on strong correspondent banking relationships Note: % of Assets as of March-end % of Q1 15 Revenue *In October 2014, the Bank entered into a sale and purchase agreement in respect of its investment in First Gulf Financial Services (FGFS) to a third party for a total consideration of AED 38.2Mn. The sale was effective in Q generating a gain on sale of associate of AED 15.1Mn Subsidiaries: First Gulf Libyan Bank, First Gulf Properties, Aseel Finance, Dubai First, Mismak Properties, First Merchant International, Radman Properties, FGIT Associate companies*: Green Emirates Properties Head Office support units: Audit, Financial Control, HR, Operations, Strategy and Planning, PMO, Admin, Legal, Risk Management, Corporate Communications 17/40

18 Operating Environment FGB Profile Q1 15 Performance Review Three-Pillar Strategy Our Vision: To Be Recognised as a World-Class Organization Maximizing Value For All Stakeholders ORGANIC GROWTH OF CORE BANKING ACTIVITIES Build deeper client relationships, providing solutions and high quality service Continue to target large creditworthy UAE-based customers Develop and strengthen a customer-centric approach emphasizing on bespoke service quality and product range SELECTIVE REGIONAL AND INTERNATIONAL EXPANSION Geographic diversification through expansion of existing operations and penetration in key markets Focus on trade and financial flows through the UAE into target international locations Sourcing and distribution of trade and financing opportunities across the FGB network SYNERGIES WITH SUBSIDIARIES AND ASSOCIATES Aseel Finance to provide innovative Islamic products to a broad base of customers and businesses Dubai First to provide specialist credit card propositions to the expanding UAE customer base Enhance fee income through comprehensive property management of residential and commercial real estate assets across the UAE Our Mission: To Be the First Choice for customers 18/40

19 Operating Environment FGB Profile Q1 15 Performance Review Key Achievements (1/2) TOTAL ASSETS (AED BN) LOANS & ADVANCES (AED BN) CUSTOMER DEPOSITS (AED BN) Q1' Q1' Q1'15 SHAREHOLDERS EQUITY (AED BN) OPERATING INCOME (AED MN) NET PROFIT (AED MN) ,483 7,270 8,421 9,420 3,707 4,154 4,774 5,656 2,322 1, Q1' Q1' Q1'15 19/40

20 Operating Environment FGB Profile Q1 15 Performance Review Key Achievements (2/2) NET INTEREST MARGIN (%) NPL RATIO (%) PROVISION COVERAGE (%) Q1' Q1' Q1'15 COST TO INCOME RATIO (%) ROAE (%) ROAA (%) Q1' Q1' Q1'15 20/40

21 Operating Environment FGB Profile Q1 15 Performance Review FGB vs. large domestic peers Q1 15 RETURN ON AVERAGE EQUITY R ETURN ON AVERAGE ASSETS 2.7% 19.2% 17.2% 15.1% 14.4% NET PROFIT (AED MN) 1,671 1, % 1, % 1, % TOTAL ASSETS (AED BN) C USTOMER DEPOSITS (AED BN) LOANS & ADVANCES (AED BN) /40

22 Operating Environment FGB Profile Q1 15 Performance Review FGB vs. large domestic peers Q1 15 Ranking Profitability & Efficiency Asset Quality Liquidity Solvency Return on Average Equity % #2 Return on Average Assets % #1 Cost to Income % #1 Net Interest Margin % #2 Earnings Per Share AED #1 NPL ratio % #1 Provision Coverage % #2 Net Loans to Total Assets % #3 Loans to Deposits % #3 Liquid Asset Ratio % #3 Tier 1 Capital % #2 Capital Adequacy % #3 22/40

23 Operating Environment FGB Profile Q1 15 Performance Review Q1 15 Performance Key Highlights Good start to the year with Q1 15 Net Profit up 7% YoY to AED 1,417Mn; EPS up 11% YoY to AED 0.31 Revenues at AED 2,322Mn, up 3% YoY, driven by solid 13% growth in non-interest income in line with the bank s revenue diversification strategy Commercial momentum intact with loans and advances up 2% QoQ (+16% YoY) driven by growth across all business segments; Customer deposits grew 1% QoQ (+10% YoY) Key Ratios: NIM at 3.44%, loan-to-deposit ratio at 99.9%, C/I ratio at 22.6% Healthy asset quality metrics: 97bps cost of risk, 2.5% NPL ratio, 126.1% NPL coverage Robust capital position with total CAR at 18.0% and Tier 1 capital at 16.8% Solid returns with RoAE at 17.2% and RoAA at 2.7% 23/40

24 Operating Environment FGB Profile Q1 15 Performance Review Q1 15 Summary Financials Income Statement (AED Mn) Q1'15 Q1'14 YoY Q4'14 QoQ 1,587 1,601-1% 1,626-2% % 746-1% Operating Income 2,322 2,251 3% 2,372-2% G & A expenses (524) (475) 10% (602) -13% Provisions/ Impairments (372) (436) -15% (177) 110% Taxes (5) (4) 25% (14) -64% Minority Interest (2) (5) -60% (29) -93% 1,417 1,330 7% 1,550-9% % % Mar'15 Mar'14 YoY Dec'14 QoQ Net Loans & Advances % % Customer Deposits % % Total Assets % % % % Mar'15 Mar'14 YoY (bps) (30) (90) ,010 Loan-to-Deposit Return on Average Equity (30) Return on Average Assets Net Interest and Islamic Financing Income Other Operating Income Net Income Earnings Per Share (AED) Balance Sheet (AED Bn) Shareholders Equity Key Ratios (%) Net Interest Margin Cost-to-Income Non-Performing Loan (NPL) Provision Coverage Capital Adequacy Note: Rounding differences may appear in the above table (100) 24/40

25 Operating Environment FGB Profile Q1 15 Performance Review Asset Mix and Lending Activity HIGHLIGHTS LOAN BOOK T REND (AED BN) As of March-end 15, loans and advances grew by 16% YoY and 2% from Dec 14 (+AED 3.1Bn) driven by continued strength across both wholesale and consumer segments At this stage, there is no sign of slower credit demand due to lower oil prices and the Bank maintains high-single digit loan growth guidance for FY15 FGB s loan portfolio is very well diversified across economic sectors with 60% wholesale/ 40% consumer loan book exposures Liquid assets represent 16% of total assets as of March-end 2015, against 18% in Q1 14 following strong loan growth over the past year +16% Mar'14 ASSET MIX Investments 9% Loans & Advances 64% Jun' Sep'14 LOAN BOOK BREAKDOWN MAR 14 Inv. Properties 4% Other 5% MAR 15 Inv. Properties 4% Liquid Assets 18% Investments 8% Loans & Advances 67% Manufacturing 5% Public Sector 8% Other 5% Liquid Assets 16% BY Dec'14 Mar'15 S ECTOR Agriculture Energy Trading Others0% 1% 6% 0% Construction 4% Transportation 2% Services 16% Financial Services 8% Real Estate 10% Securities/ Share Financing Government 0% 0% Retail Loans and cards 23% Retail Mortgages 2% Personal - Others 3% Retail Mortgages - NHL 12% 25/40

26 Operating Environment FGB Profile Q1 15 Performance Review Liquidity HIGHLIGHTS CUSTOMER DEPOSITS T REND (AED BN) mainly driven by the increase in time deposits +10% During Q1 15, customer deposits increased by 1% QoQ (+AED 1.6Bn) Sep'14 Dec'14 Mar'15 Government & Public Sector deposits share in total deposits remained intact compared with Dec 14 at 34% Plain vanilla L/D ratio remained within target range at 99.9% ; Regulatory Advances to Deposits ratio at 85.5% remained well below the regulatory ceiling CASA deposits represent 19% of Mar 15 deposit base Mar'14 LIQUIDITY RATIOS (%) DEPOSITS BY S ECTOR Jun' Retail 13% International Division 3% Government & Public Sector 34% 79.1 Corporate 37% Mar'14 L/D ratio Jun'14 Sep'14 Dec'14 Mar'15 Regulatory Advances-to-Deposits Ratio NHL Deposit 13% 26/40

27 Operating Environment FGB Profile Q1 15 Performance Review Funding Mix HIGHLIGHTS LIABILITY MIX In Jan 15, the Bank proceeded with the full pre-payment of USD 900Mn syndicated loan due in December 2015 In line with its funding diversification strategy, FGB completed the following transactions during the first quarter of year HKD 160Mn EMTN (AED 2.43% coupon 5-year USD 750Mn EMTN (AED 2.625% coupon 3-year EUR 15Mn EMTN (AED 3m EURIBOR+0.36% MAR 14 Borrowings, EMTN, Sukuk 8% Other 5% Due to Banks 4% MAR 15 Borrowings, EMTN, Sukuk 7% Equity 16% Other 4% Equity 15% Due to Banks 7% Subsequent to 31 March 2015, FGB issued a 3-year CNY 400Mn EMTN (AED 236Mn) carrying a coupon rate of 5.0% Customer deposits 67% Customer deposits 67% WHOLESALE FUNDING (AED MN) MATURITIES (AED MN) Mar 15 Bank loans 184 EMTN 8,572 Medium term bonds 2,199 Repurchase agreements 3,938 4,373 3,021 2, Sukuk 4,224 Total 15, /40

28 Operating Environment FGB Profile Q1 15 Performance Review Key Revenue Movements and NIMs HIGHLIGHTS KEY MOVEMENTS IN OPERATING INCOME (AED MN) Q1 15 revenues grew by 3% YoY (+AED 71Mn) mainly driven by : +AED 28Mn addition in core fees and commissions arising from higher syndication and credit card fees +AED 58Mn FX & Derivatives income thanks to enhanced cross-sell +AED 8Mn in Other Income including AED 15Mn gain on sale of FGFS and AED 25Mn gain on sale of property (vs. AED 41Mn in Q1 14) Net interest and Islamic income shows a YoY decrease of AED 14Mn as higher volumes did not sufficiently offset NIM contraction over the period. Mar 15 NIM stood at 3.44% down by 29bps YoY, inline with the anticipated 25-35bps NIM decline in FY15 N ET INTEREST MARGIN (%) - YTD ,251 Q1' ,322 +3% Net Interest Investment and Islamic Fin. Income Income Fees and Other income FX&Derivatives commissions Q1'15 REVENUE BREAKDOWN (AED MN) Net Interest and Islamic Financing Income Other Income (inc. share of profit from assoc.) Mar'14 Jun'14 Sep'14 Dec'14 Mar'15 2,251 2,288 2,329 2,372 71% 72% 69% 69% 68% 29% 28% 31% 31% 32% Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 2,322 28/40

29 Operating Environment FGB Profile Q1 15 Performance Review Non-Interest Revenues and Cost Efficiency HIGHLIGHTS Q1 15 N ON-INTEREST REVENUES Revenue diversification continues to be a key area of focus with non-interest revenues growing by 13% YoY and increasing their contribution in total operating income to 32% (vs. 29% last year) Fee income and credit card fees grew by 14% and 12% YoY respectively, while slower off-balance sheet activity was the main reason behind the 9% YoY decrease in commissions Core fees and commissions represent 64% of non interest revenues (20% total operating income) as of March-end 15 Q1 15 C/I ratio at 22.6% landed below 23%-24% target range for FY15 Q1 15 N ON-INTEREST REVENUE BREAKDOWN FX & Derivatives 13% Property and other Income 13% Investment income 10% Commission Income 17% Fee Income 27% Credit card fees 20% In AED Mn Q1 15 Q1 14 YoY % Commission Income % Fee Income % Credit card fees % Investment income % FX & Derivatives % Property and other income* % Total % *Including share of profit from associates COST E FFICIENCY Operating expenses (AED Mn) 22.6% 21.1% 475 Q1'14 C/I ratio (YTD) +10% 524 Q1'15 29/40

30 Operating Environment FGB Profile Q1 15 Performance Review Credit Quality HIGHLIGHTS NPL RATIO AND PROVISION COVERAGE (%) Reflecting a favorable operating environment, Q1 15 asset quality metrics remained quasi-intact compared with Dec 14 levels with NPL ratio at 2.5% and provision coverage at 126.1% FGB continues to build its general provision buffer in line with the growth in assets: at AED 2.6Bn, general provisions exceed 1.5% of total CRWA (all inclusive) NPL ratio Q1'14 H1'14 9M'14 H1'14 9M' FY'14 Q1'15 NPLS AND PROVISIONS (AED MN) Mar 15 Mar 14 YoY % Dec 14 QoQ % NPLs 3,666 4,361-16% 3,533 4% Provisions 4,623 4,187 10% 4,478 3% Specific 1,982 2,178-9% 1,975 0% General 2,641 2,010 31% 2,503 6% Q1'14 COST OF RISK (%) - YTD Annualized Q1 15 Cost of Risk came in at 97bps which is in line with the 100bps guidance for FY15 Provision Coverage FY' Q1'15 30/40

31 Operating Environment FGB Profile Q1 15 Performance Review Capital Strength (Basel II) HIGHLIGHTS CAPITAL ADEQUACY RATIO (%) Basel II total CAR and tier 1 capital ratios remained robust BASEL II CAR at 18.0% and 16.8% respectively RWA grew by 11% YoY following the growth in assets FGB s medium term Tier 1 capital floor under Basel II remains at 14% Tier 1 Capital Mar'14 CAPITAL BASE (AED BN) Total Capital Tier 1 Capital Jun'14 Dec' Sep'14 Dec' Mar'14 Sep' Mar'15 RISK WEIGHED ASSETS (AED BN) Jun' Mar'15 Mar'14 Jun'14 Sep'14 Dec'14 Mar'15 31/40

32 Operating Environment FGB Profile Q1 15 Performance Review Business Segment Contributions HIGHLIGHTS ASSETS BREAKDOWN Continued focus on enhancing core capabilities and on maximizing synergies between the three core businesses: Wholesale & International Banking Group (WBG), Consumer Banking Group (CBG), and Treasury & Global Markets Group (T&GM) CBG 24% Real Estate activities 5% These three pillars represent 89% of Group total assets as of Mar 15. CBG generated 37% of Q1 15 Group revenues, followed by WBG (35%) and T&GM (15%) Combined contribution of Dubai First and Aseel Finance to Q1 15 Group revenues and net profit stood at 7% and 5% respectively T&GM 21% WBG 44% Other Operations* 6% *Other Operations comprise subsidiaries and associates (other than real estate), and the Head Office S EGMENTAL REVENUE BREAKDOWN AND CONTRIBUTIONS TO GROUP REVENUE* (AED MN) T&GM 15% Real Estate 3% , CBG 37% Other Operations 10% WBG 35% 816 WBG CBG *Note: Effective 1st January, 2015, the Bank has changed its Funds Transfer Pricing Methodology ( FTP ). As a result of the change in the FTP, comparative figures relating to net interest income and income from Islamic financing as well as profit attributable to equity holders of the Bank for 2014 have been adjusted for consistency purposes. T&GM Other Operations Real Estate FGB Group 32/40

33 Operating Environment FGB Profile Q1 15 Performance Review Wholesale Banking Group - WBG HIGHLIGHTS OPERATING INCOME (AED MN) WBG revenues show a 8% YoY 12% contracting NIMs 12% % 11% 88% 91% Q1'15 Q1'14 International operations generated 12% of WBG operating income that is 4% of Group revenues in Q decline mainly as a result of N ET PROFITS (AED MN) 88% -8% +1% 89% WBG Q1 15 net profit at AED 590Mn represents 42% of Group Profits Q1'14 UAE operations TOTAL ASSETS (AED BN) International Operations UAE operations Q1'15 International Operations WHOLESALE GROSS LOAN PORTFOLIO (MAR 15) Abu Dhabi Private Sector 40% Dubai Private Sector 19% +21% Mar'14 Mar'15 Government & Public Sector 8% Non UAEbased Corporates 29% Other UAE Private Sector 4% 33/40

34 Operating Environment FGB Profile Q1 15 Performance Review Consumer Banking Group - CBG HIGHLIGHTS OPERATING INCOME (AED MN) Continued focus on product innovation and enhanced customer experience CBG revenues grew 7% YoY to AED 862Mn while Net Profit shows a 5% YoY increase N ET PROFITS (AED MN) +7% +5% Wealth Management, SME loans and credit cards remain key growth drivers for CBG representing 23% of the gross loan portfolio in Q1 15 TOTAL ASSETS (AED BN) +11% Mar'14 Q1'15 Q1'14 Q1'15 CONSUMER GROSS LOAN PORTFOLIO (MAR 15) Q1'14 Mar'15 Abu Dhabi Government National Housing Loans 34% Personal Loans 39% Credit Cards 8% Other Mortgage Loans 4% Loans to SMEs 6% Others* 0% *Auto loans and overdrafts Wealth Management 9% 34/40

35 Operating Environment FGB Profile Q1 15 Performance Review Treasury & Global Markets T&GM HIGHLIGHTS OPERATING INCOME (AED MN) T&GM revenues recorded a 6% YoY increase to AED 349Mn while net profits improved by 4% to AED 319Mn. 90% of FGB s investment portfolio is in investment grade fixed income of which 62% is allocated to the GCC The average duration of the AFS portfolio is 2.88 years which represents 71% of the portfolio size 55% of Fixed Income is rated A- & above, 30% is rated between BBB+ & BBB-, the remaining 15% is either non rated or sub investment grade The WARF of the portfolio is BBB % Q1'15 INVESTMENTS1 BY T YPE 45.9 Funds 2% % Q1'14 TOTAL ASSETS (AED BN) N ET PROFITS (AED MN) Q1'14 Q1'15 INVESTMENTS2 BY REGION Private Equity 7% Europe 11% Asia 24% Equities 1% N.America 2% Others 1% -3% Mar'14 GCC 62% Bonds 90% Mar'15 1Investment portfolio totaling AED 17.1Bn as of March-end AFS and HTM bond portfolio totaling USD 14.9Bn as of March-end /40

36 Operating Environment FGB Profile Q1 15 Performance Review Real Estate Subsidiaries HIGHLIGHTS OPERATING INCOME (AED MN) Real estate revenues declined by 16% YoY mainly due to the stronger gains on sale of property recorded in Q1 14 (of AED 41Mn) N ET PROFITS (AED MN) During Q1 15, the bank continued to selectively liquidate some of its property investments by selling a plot of land in Dubai 58-16% -18% Rental yield in Q1 15 landed at 5.9% Q1'14 TOTAL ASSETS (AED BN) 10.9 Q1'15 Q1'14 INVESTMENT PROPERTIES PORTFOLIO1 (MAR 15) 10.6 Dev. Properties in Abu Dhabi 43% -3% Mar'14 Q1'15 Land in Abu Dhabi 28% Mar'15 1AED 8.5Bn as of March-end 2015 Land in Dubai 2% Dev. Properties in Dubai 6% Properties Generating Rental Income 21% 36/40

37 Dividend History NET PROFIT (AED MN) 5,656 4,774 4,154 3,707 3,420 CASH DIVIDEND (AED MN) 3,900 3,000 2,500 1, CASH DIVIDEND (% OF CAPITAL) 100% 100% 83% 100% 60% BONUS SHARES (% OF CAPITAL) 15.38% 30% - 100% - 69% 63% 60% 40% 26% 17.5% 17.4% 18.7% 18.0% 19.5% DIVIDEND PAYOUT RATIO (% OF NET PROFIT) BASEL II CAPITAL ADEQUACY AFTER DIVIDEND DISTRIBUTION2 1 Shares 2CAR bought back in 2010: 5% of capital adjusted from Tier 2 MoF Loan 37/40

38 2015 Financial Guidance FY 2015 LOAN BOOK GROWTH High Single-Digit REVENUE GROWTH Double-Digit NIMS 25bps 35bps decrease EXPENSES C/I Ratio: 23%-24% ASSET QUALITY CoR ~ 100bps NET PROFIT GROWTH Low Double-Digit ROAE* 18% TIER 1 CAPITAL* 15%-16% *Including perpetual notes 38/40

39 FGB 2015 Awards FGB Siraj recognised as Islamic Bank of the Year - Shariah Compliant Window for 2015 Banker Middle East UAE Product Awards: Best Call Centre, Best Credit Card, Best Personal Loan, Best Wealth Management Service/Proposition, Best Offshore Wealth Proposition, Best Deposit Account Product and Best Bancassurance Product Most Innovative Service Provider MENA IR Insurance Awards Interactive Media Awards: Best in Class for FGB s My FGB Card website Outstanding Achievement for the FGB Wealth website UAE Excellence Awards: Golden Award for 39/40

40 Thank you! For more Information, contact FGB Investor Relations Department: Visit our corporate website Or flash this QR code to install FGB Investor Relations App for iphone, ipad or Apple Watch You can also connect with FGB on Social Media through the following channels: 40/40