Sterling Bank Plc Analyst/Investor Presentation FY 2014 & Q1 2015 1
Important Information Notice This presentation has been prepared by Sterling Bank PLC. It is intended for an audience of professional and institutional investors who are aware of the risks of investing in the shares of publicly traded companies. The presentation is for information purposes only and should not be construed as an offer or solicitation to acquire, or dispose of any securities or issues mentioned in this presentation. Certain sections of this presentation reference forward-looking statements which reflect Sterling Bank s current views with respect to, among other things, the Bank s operations and financial performance. These forward-looking statements may be identified by the use of words such as outlook, believes, expects, potential, continues, may, will, should, seeks, approximately, predicts, intends, plans, estimates, anticipates or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. In other cases, they may depend on the approval of the Central Bank of Nigeria, Nigerian Stock Exchange, and the Securities and Exchange Commission. Accordingly, there are or may be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Sterling Bank believes these factors include but are not limited to those described in its Annual Report for the financial year ended December 31, 2014. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release. Sterling Bank undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. 2
Agenda 1. Overview 2. Operating environment 3. Performance review 4. Q1 2015 highlights 5. Outlook 3
4 Overview
Timeline 1960 2000 2001 Commenced operations as Nigeria Acceptances Limited (NAL) Bank the pioneer merchant bank in Nigeria Fully privatised following Government s sale of its residual interest Became a universal bank 2006 2008 2011 Merged with Indo-Nigeria Merchant Bank (INMB), Magnum Trust Bank, NBM and Trust Bank of Africa to form Sterling Bank Plc Raised $95 million from Citibank; Launched our One Customer proposition Sold non-core businesses following the repeal of universal banking by the CBN; Acquired Equitorial Trust Bank (ETB) 2012 2013 2014 Completed the integration of ETB in six months and launched retail banking Raised N12.1 billion through a Rights Issue; Obtained noninterest banking license and Launched Agent Banking Raised US$120 million (N19.1 billion) through Private Placement 5
Sterling Bank at a glance Company Sterling Bank is a full service national commercial Bank Accounting International Financial Reporting Standards (IFRS) Auditors Listing Ernst & Young Nigerian Stock Exchange 2015+ Focus segments Retail, Commercial 2013-2015 and Corporate clients Active Customers > 1,400,000 2010-2012 Headcount 3,043 professional employees Channels 174 business offices; 630 ATMs; 3,200 POS Ratings Agency Short Term Long Term GCR A3 BBB 6
Awards and Recognition Pearl Awards Nigeria Highest Dividend Yield Award 2014 2014 Nigerian Risk Awards 1st Runner Up BusinessDay Awards One of Nigeria s Top 100 most Respected Companies 2014 Awards of Excellence by the CBN Best Performing Bank in Commercial Agriculture Credit Scheme (CACS) 2014 Nigeria Agriculture Awards Agriculture Bank of the Year 2014 Nigerian Telecom Awards Innovative ICT Banking Product of the Year Social Lender BusinessDay Banking Awards 2014 Most innovative Banking Product of the Year 2014 7
Management Metrics Guidance Performance Revenue growth - Double Digit (>10%) Earnings rose 13% to N103.7bn (2013: N91.6bn) Cost-to-income <75% Cost-to-income of 73.6% 1 (2013: 69.4%) Pre-tax Return on average Equity (ROAE) >20% Pre Tax Return on average equity of 16.6% 2 (2013: 19.0%) X (Due to pressure on earnings arising from monetary policy changes) Dividend per share = 6k (Dividend policy) Dividend per share of 6 kobo (2013: 25 kobo) NPL ratio <3% Non-performing loans ratio of 3.1% (2013: 2.1%) X Net loans growth >20% Net loans grew 15.4% to N371.2 billion (2013: N321.7bn) (Due to selective risk taking given uncertainties in the operating environment) X Deposit growth >25% Deposits grew 15.0% to N655.9 billion (2013: N570.5bn) (Growth moderated in line with our focus on balance sheet efficiency) X 1 Excludes cost of risk 2 Pre-tax ROAE adjusted for Private Placement proceeds received in December 2014 8
Key message We have re-aligned our business by market segments for a more focused market reach Raised additional core capital of N18.5 billion through Private Placement Earnings are strong - double digit growth year-on-year Customer base is growing in excess of 1.4 million 2010-2012 Commenced the process of changing our core banking application to effectively serve our growing customer base Shareholder value consistently paid dividend since 2011 Conservative management approach focused on sustainable growth 9
10 Operating Environment
Operating Environment /1 May-14 112.2 Q4-2013 Jun-14 114.4 Q1-2014 Jul-14 109.2 Aug-14 102.3 Q2-2014 Sep-14 98.1 Oct-14 88.5 Q3-2014 Nov-14 80.1 Q4-2014 Dec-14 63.8 Oil fever extended to the end of the year Structural induced supply glut remained in the last quarter of the year which continued to exert downward pressure on prices Bonny-light Price Trend - US$ While global growth remained largely uneven As the US & UK economies continued to gather momentum, weaknesses persisted in the Euro area, China, Brazil & other emerging economies Lower oil prices & electioneering drag domestic economy Q4 2014 GDP came in at 5.94% y-o-y, 0.29 percentage points lower than 6.23% in Q3 Bonny-Light US$ Foreign reserves was down 20.9% from December 2013 to US$34.5bn as at December 2014; and fell further to 2010-2012 US$29.8bn in March 2015 Naira also got a hit as it was devalued to 168/US$ from N155/US$ in November 2014; the scrapping of the RDAS market in February pushed the value of the Naira further down to N199/US$ 6.77% QoQ GDP Growth 6.54% 6.21% 6.23% 5.94% 11
Operating Environment /2 Key Regulatory Actions Effective Date Rationale Monetary Policy Rate (MPR) increased by 100 basis points from 12% to 13% November 2014 To defend the Naira and manage systemic liquidity Cash Reserve Ratio (CRR) on private sector deposits was increased to 20% while that of public sector remained at 75% November 2014 Scrapping of official (RDAS) FX market February 2015 To defend the Naira and manage systemic liquidity To curb speculative activities around the Naira 2010-2012 Commencement of Treasury Single Account in which Federal agencies and departments collections account would be moved to the Consolidated Revenue Account (CRF) March 2015 To reduce systemic liquidity and reduce dependence on public sector deposits 12
13 Performance Review - Earnings analysis
Income statement highlights Common Size Common Size Items (N'm) 2014 2014 2013 2013 Growth Gross Earnings 103,679 100% 91,743 100% 13% Interest income 77,932 75% 69,973 76% 11% Interest expense (34,915) 34% (34,160) 37% 2% Net interest income 43,017 41% 35,813 39% 20% Fees and commission income 16,133 16% 14,564 16% 11% Net trading income 6,767 7% 3,714 4% 82% Other operating income 2,847 3% 3,492 4% -18% Operating income 68,764 66% 57,583 63% 19% Impairment charge (7,389) 7% (8,259) 9% -11% Net operating income after impairment charge 61,375 59% 49,324 54% 24% Personnel expenses (12,031) 12% (10,267) 11% 17% Other operating expenses (10,112) 10% (8,378) 9% 21% General & administrative expenses (19,794) 19% (14,042) 15% 41% Other property, plant & equipment cost (5,551) 5% (4,632) 5% 20% Depreciation and amortization (3,140) 3% (2,694) 3% 17% Total expenses (50,627) 49% (40,013) 44% 27% Profit before income tax 10,748 10% 9,310 10% 15% Income tax expense (1,743) 2% (1,035) 1% 68% Profit for the year 9,005 9% 8,275 9% 9% 14
Non-interest Income Interest Income Revenue evolution./1 Cash & equivalent Investment securities Loans & advances N B 32.3 24.5 0.1 1.2 16.4 8.6 14.7 15.7 +34% 53.5 0.8 19.7 33.0 70.0 0.8 22.3 46.8 +11% 77.9 3.0 18.1 56.8 Other income Trading income Net fees & commission 5.9 0.4 4.4 1.1 15.5 8.1 0.9 6.4 +44% 15.3 3.8 1.6 10.0 +19% 25.7 21.7 2.8 3.4 6.8 3.7 14.6 16.1 2010 2011 2012 2013 2014 15
Revenue evolution./2 N B Gross revenue 30.4 47.8 19% 81% 32% 68% 2010 2011 Non-interest income 68.8 91.7 103.7 22% 24% 25% 78% 76% 75% 2012 2013 2014 Interest income Comments Revenue grew at a compound annual growth rate of 36% (CAGR: 2010-2014) driven by increased transaction volumes and activities Interest income rose by 11% on the back of a 21% rise in income from loans & advances and accounted for 75% of revenue Non-interest income grew by 18% on the back of 82% growth in trading income and accounted for 25% of revenue Loans & Advances Investment Securities Cash & cash equivalent 4% 1% Fees & Commission Trading Income Others 11% 16% 23% 32% 2014 2013 73% 67% 26% 2014 2013 63% 17% 67% 16
5.0% 4.7% 6.3% 6.1% 5.3% Net interest income N B Net interest income 16.7 14.5 +31% 23.9 35.8 +20% 43.0 Comments Net interest income rose by 20% to N43.0 billion representing a compound annual growth rate of 31% (CAGR: 2010-2014) driven by growth in lending activities Loans and advances accounted for 73% of interest income, while investment securities accounted for 23% 12.2% 7.2% 9.7% 5.0% 11.5% 5.2% 14.2% 14.2% 8.1% 8.9% Growth in interest income was strong enough to douse the effect of a 2% increase in interest expense resulting in an 80 basis points rise in net interest margin to 8.9% Despite a high interest rate environment, funding costs moderated by 80 basis points to 5.3% (2013 6.1%) 2010 2011 2012 2013 2014 Spread Cost of funds Yield on earning assets 17
Operating Efficiency N B Cost-to-income Net interest income 74% Non-interest income 82% +20% 68.8 68% 69% 74% 57.5 39.2 63% 62% 30.1 20.4 55% 61% 71% 37% 45% 39% 38% 29% 50.6 40.0 32.0 35.5 27.1 20.5 15.2 20.0 12.4 2.6 2.7 3.1 9.5 1.3 1.5 4.4 6.5 9.4 10.3 12.0 2010 2011 2012 2013 2014 Staff Depreciation Other Expenses Comments Operating income rose by 20% to N68.7 billion driven by improvements in net interest income, resulting from a slower growth in interest expense relative to income Increase in operating expenses arising from on-going investments in branch refits and expansion and rollout of alternative channels as well as regulation induced cost Other expenses comprise general and administrative costs; plant, property and equipment costs and statutory fees Increase in personnel costs due to an increase in headcount and staff promotion exercises Cost-to-income excluding cost of risk was 73.6% (82.5% unadjusted) in line with Management guidance 18
2010 2011 2012 2013 2014 Profitability N B Profit before Tax Profit after Tax +30.7% CAGR: 2010-2014 Comments Sustained profit growth momentum despite pressure on earnings arising from regulatory policy changes 3.7 4.2 5.6 6.9 7.5 +21.2% 10.7 2010 2011 2012 2013 2014 7.0 9.3 8.3 9.0 PBT rose 15% to N10.7 billion, while PAT grew by 9% to N9.0 billion Pre-tax ROAE was 16.6% (post 13.9%) The Bank has paid dividend consistently since 2011 and has proposed a dividend of 6k per share for 2014 representing 20% of PAT and in line with dividend policy ROAA 2010-2012 ROAE 16.7% 17.1% 15.2% 19.0% 16.6% EPS 33k 53k 44k 52k 42k 2014 ROAE adjusted for the private placement proceeds received at year-end 1.6% 1.5% 1.4% 1.4% 1.4% 2010 2011 2012 2013 2014 19
20 Performance Review - Balance sheet analysis
Highlights of financial position Common Size Common Size Items (N'm) 2014 2014 2013 2013 Growth ASSETS Cash and balances with CBN 174,760 21% 96,901 14% 80% Due from banks 67,330 8% 85,601 12% -21% Pledged financial assets 78,751 10% 79,772 11% -1% Loans and advances to customers 371,246 45% 321,744 45% 15% Investment securities 96,571 12% 97,821 14% -1% Other assets 14,137 2% 9,317 1% 52% Property, plant and equipment 13,952 2% 9,069 1% 54% Intangible assets 821 0% 601 0% 37% Deferred tax assets 6,971 1% 6,971 1% 0% TOTAL ASSETS 824,539 100% 707,797 100% 16% LIABILITIES Deposits from customers 655,944 80% 570,511 81% 15% Current income tax liabilities 1,802 0% 1,112 0% 62% Other borrowed funds 45,371 6% 38,795 5% 17% Debt securities issued 4,564 1% 4,564 1% 0% Other liabilities 32,143 4% 29,358 4% 9% TOTAL LIABILITIES 739,824 90% 644,339 91% 15% Equity 84,715 10% 63,458 9% 33% TOTAL LIABILITIES AND EQUITY 824,539 100% 707,797 100% 16% 21
Assets growth trend N B Cash & short term investments Fixed Assets Other Assets Government Securities Loans & Advances 504.0 90.5 20.4 8.9 259.6 222.2 4.4 34.5 22.1 96.6 162.1 101.9 +34% 580.2 97.5 7.8 232.2 229.4 13.3 707.8 182.5 16.9 9.1 177.6 321.7 +16% 824.5 242.1 21.9 14.0 175.3 371.2 2010 2011 2012 2013 2014 Comments Total assets grew at a compound annual growth rate of 34% (CAGR: 2010-2014) and 16% in 2014 Growth was boosted by funding from customer deposits and shareholders funds which increased by 15% and 33% respectively Cash and short term funds increased by 32% due to an increase in cash reserve requirement Increase in fixed assets by 54% due to on-going investments in branch refits and expansion and rollout of alternative channels 22
Funding mix N B 260 9.7% 3.4% 10.1% 0.0% 504 580 708 825 100% 5.4% 5.2% 5.5% 5.0% 0.9% 0.8% 0.6% 4.2% 5.5% 4.3% 4.0% 0.6% 8.1% 8.0% 9.0% 10.0% 76.8% 81.3% 80.5% 80.6% 80.0% Borrowings Debt Securities Other Liabilities Equity Deposits 2010 2011 2012 2013 2014 Deposits remained the major source of funding at 80% of total assets 23
Liquidity N B 2013 2014 174.8 96.9 85.6 67.3 Cash with CBN Due from banks 49.1 41.6 Treasury bills 44.2 50.4 Government bonds 1.1 1.5 Euro bonds Comments Liquid assets (excluding Pledged) accounted for 41% of total assets (Dec 2013: 39%) due to increase in cash balances with the CBN Increase in cash and balances with CBN due to an upward review of CRR on public and private sector deposits Investment Securities Split 47.0% 2.0% 2010-2012 Dec 2014 51.0% 78.0% 2.0% Dec 2013 20.0% Held for trading Available for sale Held to maturity Investment securities was relatively stable at N97.6 billion with 51% of the securities held for sale and 47% held to maturity Overall, liquidity ratio was above regulatory benchmark of 30% at 34% (Dec. 2013; 43%), while net loan to deposit ratio was 57% (Dec. 2013; 56%) leaving room for asset creation 24
Loans by business segment Corporate Institutional Retail Commercial Loans and advances +15% N B +16% Gross Loans 380.9 371.2 Net loans 328.7 321.7 236.1 229.4 170.5 162.1 111.6 101.9 2010 2011 2012 2013 2014 Institutional Retail Commercial Corporate 381 329 13.3% 8.6% 10.1% Y-o-Y Growth 12.8% 10.4% 79% 11.9% 15% -9% 1% 66.7% 66.2% Comments Gross loans increased by 16% and net loans by 15% to N381 billion and N371 billion respectively Net loans grew at a compound annual growth rate of 39% (CAGR: 2010-2014) Growth was driven by corporate and institutional lending which increased by 15% and 79% respectively Institutional loans include financial institutions and Government, while retail loans include individuals and small businesses Loans to corporates include oil & gas, real estate, construction and power transactions 2013 2014 25
Oil & gas exposures Loans by sector by sector /1 Agriculture (2013, 3.8%) 2014 2.5% 0.1% 4.2% 3.2% 0.0% 0.3% 4.3% Capital Market (2013, 0.1%) Communication (2013, 3.1%) Consumer (2013, 2%) 21.3% 8.9% Education (2013, 0.4%) Finance & Ins. (2013, 3%) Government (2013, 5.6%) 3.6% 3.9% 0.1% 3.9% Manufacturing (2013, 5.8%) Mining & Quarrying (2013, 0.1%) Mortgage (2013, 3.6%) 4.6% Oil & Gas (2013, 30.3%) Other Public Utilities (2013, 0.6%) 3.1% 1.4% 34.5% General (2013, 6.5%) Domestic Trade (2013, 4.6%) Hospitality (2013, 2.1%) Power (2013, 2.5%) 0.0% Real Estate & Const. (2013, 21.9%) Transportation (2013, 4%) Comments 28% Well diversified loan book 42% Upstream Oil and gas recorded the highest sectoral contribution followed by real estate and construction at 35% and 21% respectively. 30% Downstream Services Finance and insurance, government and power recorded the highest growth given opportunities within the sectors 26
Loans and advances by sector /2 Sector 2014 2013 Growth Impaired % Total Impaired Agriculture 16,123 12,430 29.7% 372.2 3.8% Capital market 304 240 26.6% 240.1 2.5% Communication 12,101 10,041 20.5% 317.5 3.3% Consumer 8 6,558-99.9% 0.6 0.0% Education 1,298 1,434-9.5% 13.8 0.1% Finance and insurance 16,450 9,782 68.2% 594.1 6.1% Government 33,981 18,428 84.4% 644.9 6.7% Manufacturing 14,740 19,077-22.7% 165.8 1.7% Mining and quarrying 295 200 47.3% 2.6 0.0% Mortgage 14,789 11,834 25.0% 53.2 0.5% Oil and gas 131,583 99,733 31.9% 2,595.0 26.8% Other public utilities 0 1,869-100.0% 0.0 0.0% General 17,493 21,433-18.4% 1,561.7 16.1% Domestic Trade 11,790 15,248-22.7% 1,652.1 17.1% Hospitality 5,408 7,004-22.8% 47.0 0.5% Power 13,743 8,271 66.2% 123.4 1.3% Real estate & construction 81,202 72,068 12.7% 1,210.7 12.5% Transportation 9,578 13,015-26.4% 83.5 0.9% Non-Interest Banking 40 na Na na na Total 380,924 328,665 15.9% 9,678.1 100.0% 27
Asset quality 10.0% Comments 4.8% NPL Ratio Non-performing loans as a proportion of gross loans increased by 100 basis points to 3.1% from 2.1% in 2013 3.8% 2.1% 3.1% Cost of risk improved by 60 basis points to 1.9% due to an 11% reduction in loan loss provisions 2010 2011 2012 2013 2014 Impaired loans to gross Loans 4.4% 55.0% Impaired Loans by Business Segment 3.0% 2.9% 2.1% 17.4% 12.3% 15.3% Corporate Retail Commercial Institutional Corporate Retail Commercial Institutional 28
Deposits N B 199.3 54.7 67.1 67.9 9.6 Deposit Mix 0.6% 68.2% 2010-2012 Dec 2014 655.9 570.11 4.2 409.8 466.8 2.0 3.1 17.7 355.8 447.6 284.1 248.5 20.7 25.4 32.6 125.1 9.6 158.9 187.3 171.5 2010 2011 2012 2013 2014 Time Savings Current Others Total Deposit 26.1% 5.0% 62.4% 0.3% Dec 2013 32.8% 4.5% Comments Deposits grew at a compound annual growth rate of 35% (CAGR: 2010-2014) and 15% YoY to N655.9 billion on the back of growth in current and savings account balances Retail deposits accounted for 73% (2013: 67%) of deposits, while wholesale funds accounted for 27% Growth in retail deposits affirms that benefits of our enhanced network are beginning to kick-in Cost of funds improved by 80 basis points to 5.3% from 6.1% in 2013 despite tight monetary policy measures Time Savings Current Others 29
Capital and liquidity Items (N'm) 2014 2013 Growth Total Tier 1 74,995 56,181 33% Total Tier 2 3,432 6,797-50% Total qualifying capital 78,427 62,978 25% Risk-weighted assets 566,687 448,520 26% Tier 1 Ratio 13% 13% Tier 2 Ratio 1% 1% Capital Adequacy Ratio 14% 14% Liquidity Ratio 33.6% 43.2% Net loan-to-deposit ratio 57% 56% Equity 2010-2012 27.5 41.1 +32% 46.6 2010 2011 2012 63.5 2013 +33% 84.7 2014 Comments Capital adequacy and liquidity ratios were above the regulatory benchmarks of 10% and 30% respectively Net loan-to-deposit ratio increased by 100 basis points to 57% resulting from of growth in loans and advances Total qualifying capital rose by 25% to N78.4 billion due to a 33% growth in Tier 1 capital arising from the successful completion of a US$120 million private Placement with net proceeds of N18.5 billion. A 50% reduction in Tier 2 capital due to the CBN s policy guideline excluding non-distributable regulatory reserve and other reserves in the computation of regulatory capital. 30
31 Q1 2015 Highlights
Q1 2015 earnings highlights Items (N millions) Common Size Common Size Growth March 2015 March 2014 YoY Gross Earnings 27,226 100% 24,714 100% 10% Interest income 19,238 71% 18,659 75% 3% Interest expense (10,088) 37% (8,397) 34% 20% Net interest income 9,150 34% 10,262 42% -11% Fee and commission 5,007 18% 3,315 13% 51% Trading income 2,211 8% 2,288 9% -3% Other operating income 770 3% 451 2% 71% Operating income 17,139 63% 16,317 66% 5% Net impairment charges (934) 3% (1,042) 4% -10% Personnel expenses (2,979) 11% (2,753) 11% 8% Depreciation and amortisation (936) 3% (712) 3% 31% Other operating expenses (2,896) 11% (3,042) 12% -5% General and administative expenses (3,985) 15% (3,955) 16% 1% Other property, plant and equipment cost (1,367) 5% (1,271) 5% 8% Profit before income tax 4,042 15% 3,542 14% 14% Income tax expense (130) 0% (405) 2% -68% Profit after tax 3,912 14% 3,137 13% 25% 32
Q1 2015 highlights of financial position Common Size Common Size Growth Items (N millions) March 2015 December 2014 YtD ASSETS Cash and balances 169,915 20% 174,760 21% -3% Due from banks 66,429 8% 67,330 8% -1% Pledged assets 84,167 10% 78,751 10% 7% Loans and advances to Customers 392,407 47% 371,246 45% 6% Investment in securities 86,718 10% 96,571 12% -10% Other assets 19,852 2% 14,137 2% 40% Property, plant and equipment 14,382 2% 13,952 2% 3% Intangible assets 1,059 0% 821 0% 29% Deferred tax assets 6,971 1% 6,971 1% 0% Total Assets 841,900 100% 824,539 100% 2% LIABILITIES Deposits from Customers 622,188 74% 655,944 80% -5% Current income tax liabilities 1,932 0% 1,802 0% 7% Other borrowed funds 59,989 7% 45,371 6% 32% Debt securities in issue 4,708 1% 4,564 1% 3% Other liabilities 64,692 8% 32,143 4% 101% Total Liabilities 753,508 90% 739,824 90% 2% Equity 88,393 10% 84,715 10% 4% Total Liabilities and Equity 841,900 100% 824,539 100% 2% 33
Financial ratios Indicator Q1 2014 1H 2014 Q3 2014 FY 2014 Q1 2015 Pre Tax Return on Average Equity (annualized) 22.6% 20.0% 17.6% 16.6% 18.9% Post Tax Return on Average Equity (annualized) 20.0% 17.4% 14.7% 13.9% 18.3% Return on Average Assets (annualized) 2.0% 1.8% 1.5% 1.4% 2.0% Earnings per Share 15k 26k 33k 42k 14k Yield on Earning Assets 13.2% 13.0% 13.5% 14.2% 13.3% Cost of Funds 5.6% 5.3% 4.9% 5.3% 5.9% Net Interest Margin 7.6% 7.7% 8.6% 8.9% 7.4% Cost to Income 71.7% 73.2% 75.4% 73.6% 71.0% NPL Ratio 1.8% 1.7% 2.1% 3.1% 3.6% Capital Adequacy Ratio 14.0% 14.6% 10.0% 14.0% 12.7% Loan to Deposit Ratio 62.4% 57.8% 47.9% 56.6% 63.1% 34
35 Outlook
Corporate goals 2011-2016 2016+ Mid-term 3.5% market share measured by assets Leading consumer banking franchise (bank of choice for customers in our target markets) Diverse retail funding base <3% in non-performing loans Diversified income streams with top quartile position in all our operating areas Investment grade credit rating Double digit revenue growth Y-o-Y Long-term Globally competitive financial services franchise by financial and non-financial measures Fully scaled business model with institutionalized processes beyond the stewardship of current owners and managers Systemically important operator, materially impacting all our sectors of business participation Great place to work 36
FY 2015 guidance Double digit growth in earnings > 20% ROAE > 15% Cost-to-income ratio <72% Loan growth > 15% 2010-2012 Deposit growth > 20% 37
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