Nomura Investment Forum 27 Lee Wai Fai Chief Financial Officer 6 December 27 Disclaimer : This material that follows is a presentation of general background information about the Bank s activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not 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. This material should be considered with professional advice when deciding if an investment is appropriate. UOB Bank accepts no liability whatsoever with respect to the use of this document or its content. Singapore Company Reg No. 193526Z
Agenda 11 Business Overview 22 Financial Overview 2
UOB Overview Founding Founded in August 1935 by a group of Chinese businessmen and Datuk Wee Kheng Chiang, grandfather of the present UOB Group CEO, Mr Wee Ee Cheong. Expansion UOB has grown over the decades through organic means and a series of acquisitions. It is today a leading bank in Singapore with an established presence in ASEAN. The Group has a total network of 527 offices over 18 countries and territories. Key Statistics Total Assets: S$172.2 billion Shareholder s Equity: S$17.2 billion Gross Loans: S$87.1 billion Customer Deposits: S$14.8 billion NIM: 2.5% Non-interest / Total Income: 37.8% ROAA: 1.27% ROAE: 12.8% Cost / Income: 4.7% Tier 1 CAR: 1.2% Total CAR: 14.8% Moody s: Aa1 LT bank deposits S&P s: A+ LT counterparty credit Note: Financial statistics for the nine months ended 3 September 27 3
Execution Track Record Profit (S$ million) 2, 1,8 1,6 1,4 1,2 Acquired BOA in 24 Acquired OUB in 21 Acquired Buana in 25 9M7: S$1,63m 26*: S$1,882m 25: S$1,79m 24:S$1,452m 1, 8 6 4 Acquired FEB in 1984 Acquired LWB in 1973 Acquired ICB in 1987 1995:S$633m 2:S$913m Acquired UOBR & UOBP in 1999 2 Acquired CKB in 1971 1985:S$99m 198:S$92m 199:S$226m 1935 1945 1955 1965 1975 1985 1995 25 21 4 Note: 26 net profit after tax was S$2,57 million including one-time gain
Established Regional Presence Total Assets Breakdown CHINA 11 branches / offices Singapore : 64% ASEAN : 18% Asia-Pacific : 11% Rest of the world : 7% Profit Before Tax Breakdown Singapore : 71% THAILAND 157 branches / offices MALAYSIA 43 branches / offices HONG KONG & TAIWAN 1 branches / offices VIETNAM 1 branch / office ASEAN : 15% Asia-Pacific : 5% Rest of the world : 9% SINGAPORE 72 branches / offices INDONESIA 218 branches / offices Note: For the nine months ended 3 September 27 5
Strategic Focus Information Technology Risk Management & Compliance Investment Banking Consumers SMEs Treasury Operational Excellence Human Resources To be recognized as a leader in consumer and SME banking services in the region with investment banking and treasury products in support 6
The UOB Difference Well-diversified Regional Portfolio Proven Execution Track Record Focus on Long-Term Returns Strong Management Team Keen Understanding of Markets & Customers 7
Strong Regional Economies Real GDP Growth Private Consumption Growth (%) Singapore Malaysia Thailand Indonesia (%) 1 1 5 5-5 -5-1 -1-15 -15 1997 1998 25 26 27E 28E Singapore Malaysia Thailand Indonesia 1997 1998 25 26 27E 28E Foreign Exchange Reserves Net Foreign Direct Investments (US$bn) Singapore Malaysia Thailand Indonesia (US$bn) Singapore Malaysia* Thailand Indonesia 15 25 2 1 15 5 1 5 1997 1998 25 26 27E 28E -5 1997 1998 25 26 27E 28E 8 Source: UNCTAD, BOT, CEIC, UOB, EIU, Asia Pacific Consensus Forecasts, Brokers Reports Note: * FDI Inflow
Strategic Directions Strengthen Domestic Market Leadership Focused Regional Expansion Establish Strategic Partnerships Invest In The Future Our Mission: To be a Premier Bank in the Asia Pacific Region 9
Agenda 11 Business Overview 22 Financial Overview 1
Increasing Profitability Operating Profit Net Profit (S$m) (S$m) 3,5 3 3, 3,11 25 2,57 2,5 2, 1,5 1, CAGR 6% 2,64 1,96 2,32 2,488 2,337 2,379 21% 2,134 1,766 2 15 1 1,6 CAGR 17% 1,452 1,22 1,882 1,79 2,34 19% 1,63 1,345 5 5 FY2 FY3 FY4 FY5 FY6 9M6 9M7 FY4 FY3 FY4 FY5 FY6 9M6 9M7 One-time income of S$613 million One-time gain of S$689 million 11
Diversified Income & Controlled Expenses 6, 5, 29.9 Operating Income (S$m) (%) 37.6 37.8 4 35.8 34.5 33.9 33.2 CAGR 9% 4,224 2% 4, 3,762 3,597 3, 1,514 3,34 3,16 3,259 3,5 1,414 96 1,89 1,14 997 1,36 2 2, 2,128 2,71 2,155 2,348 2,71 1 1, 2,9 2,237 3 Operating Expenses (S$m) (%) 2,5 41.1 41.2 4.7 37.6 37.9 35.4 2, 34.7 244 1,5 1,424 1,463 1,227 222 1,239 195 1,74 1,95 188 175 1, 199 199 1,492 1,22 1,39 1,64 1,268 5 875 896 CAGR 13% 1,736 18% 45 4 35 3 25 2 15 1 5 FY2 FY3 FY4 FY5 FY6 9M6 9M7 FY2 FY3 FY4 FY5 FY6 9M6 9M7 NII Non-NII Non-NII / Total Income Other Operating Expenses Expense / Income Ratio IT Expenses Note: Excluding one-time income for 9M6 and FY6 12
Growing Customer Margins & Loans Net Interest Margin Net Customer Loans (%) (S$m) 4. 3. 3.12 3.13 3.1 3.18 3.25 3.24 3.26 2.22 2.25 2.1 1.99 1.99 2. 2.5 1, 8, 6, 76,875 67,142 64,3 59,297 58,884 CAGR 7% 73,673 16% 85,161 2. 4, 1. 2,. FY2 FY3 FY4 FY5 FY6 9M6 9M7 Loan Margin Net Interest Margin 2 3 4 5 6 Sep- 6 Sep- 7 13
Stable & Liquid Non-Loan Asset Portfolio Interbank / Securities Margin Average Interbank Balances & Securities (%) (S$m) 1..8.6.71.68.78.58.66.7.59 8, 6, CAGR 17% 54,37 65,75.4% 66,86 65,87.4.2 4, 35,569 33,174 41,69. FY2 FY3 FY4 FY5 FY6 9M6 9M7 2, 2 3 4 5 6 Sep- 6 Sep- 7 14
Strong Asset Quality NPL Ratio Impairment Coverage (%) (%) 1 9. 3 8 8.1 8. 25 249. 6 4 5.6 4. 4.6 2.3 2 15 1 138.3 141.4 138.6 159.4 61.7 64.6 67.9 69. 172.6 79.2 172.9 72.5 97. 2 5 2 3 4 5 6 Sep- 6 Sep- 7 2 3 4 5 6 Sep- 6 Sep- 7 Cumulative Impairment/Total NPLs Cumulative Impairment/Unsecured NPLs 15
Capital Management Seek Capital Efficiency Recent MAS changes give flexibility Review mix of capital structure Option of share buyback and/or special dividend for any excess capital Strong Capital for Strategic Flexibility Keep buffer above regulatory CAR to maintain high credit ratings Reserve capital as we see opportunities in Singapore and region to strengthen franchise High Dividend Policy Special dividend of 15 cents per share in 1H7. Total dividend of 35 cents per share for the period Target for consistent high payout to reward shareholders 16
In Summary Strategy remains intact. Core businesses gathering pace Further entrenched market leadership in Singapore while strengthening regional platform. Balanced global portfolio diversification Manage rising costs and talent development while investing in operating infrastructure, hubbing and processes for regional growth UOB on track to become an established premier Asian bank 17