Investor Presentation QI 2017
1. Overview 2. Financial Information 3. Business Information 4. Share Information
Overview QI 2017 Major Highlights Consistent Annual Income Growth ($M) One of the oldest local banks, founded in 1951 462.8 The most profitable bank with net profits of $462.8M in 2016 330.6 331.5 335.9 352.8 364.8 404.3 Offers complete range of universal banking services Highest Credit Ratings: B2 (Moody s), B- (Standard & Poor s) & B (Capital Intelligence) Highest Corporate Governance Score in Lebanon by Capital Concept s.a.l. 112.03 Geographic presence throughout MENA & Europe: Lebanon, Jordan, Egypt, UAE, KSA, Qatar, Iraq, UK, France, Switzerland, Romania, Cyprus 2010 2011 2012 2013 2014 2015 2016 QI 2017 Most Awarded Local Bank by Prominent International Sources The Banker Euromoney Global Finance Global Investor EMEA Finance Banker Middle East MENA FM The Asian Banker ROAA 1.50% 1.58% ROAE 15.45% 17.09% EPS (annualized) $2.09 $2.20 No. of Employees 4,746 4,673* Overall Liquidity No. of Branches ** FC LBP Lebanon 87 Foreign Key Indicators QI 2017 2016 52.40% 79.68% 131 51.84% 80.08% * Deconsolidation of Syrian Operations ** Includes 56 Insurance points of sale 88 131 1/12
1. Overview 2. Financial Information 3. Business Information 4. Share Information
Balance Sheet QI 2017 Breakdown of Total Assets [$30.1Bn; 2..86% YoY; 2010-2015 CAGR 4.76%] Breakdown of Assets by Country ($M) 2017 % Total YoY 2016 2015 2014 2013 Others 2.43% Lebanon 24,625 81.70 8.28 23,999 22,402 21,612 20,288 Cash & Central Bank 46.88% Interbank 7.16% $30.1Bn Loans 23.59% Securities (Sovereign + Corporate) 19.94% Egypt 1,651 5.48 (31.58) 1,519 2,527 2,093 1,705 Jordan 1,037 3.44 (7.16) 1,082 1,106 1,102 1,003 UAE 872 2.89 19.62 829 729 727 732 Syria * 0 0 NA 0 271 374 442 KSA 106 0.35 (3.64) 105 109 100 78 Qatar 101 0.34 4.12 94 89 120 179 Iraq 81 0.27 47.27 76 55 27 NA Europe 1,667 5.53 (6.03) 1,813 1,811 1,820 1,722 Shareholder s Equity by Country [$2.86Bn; 2.47% YoY] ($M) 2017 % Total YoY 2016 2015 2014 2013 Tier I & Tier II Capital ($M) [Basel III CAR of 18.5%] Lebanon 2,051 71.79 9.15 2,164 1,821 1,662 1,554 Egypt 143 4.99 (36.73) 116 241 217 187 Jordan 132 4.62 4.76 128 122 113 101 UAE 131 4.59 2.34 129 128 124 123 75 10 10 10 11 10 10 10 KSA 83 2.91 6.41 83 77 71 38 Syria * 0 0 NA 0 47 48 50 1,816 1,973 2,172 2,339 2,512 2,711 2,922 2,847 Qatar 40 1.40 2.56 40 39 36 41 Iraq 28 0.98 115 29 5 12 NA Europe 249 8.72 (1.19) 243 241 240 255 2010 2011 2012 2013 2014 2015 2016 QI 2017 * Deconsolidation of Syrian Operations 2/12
Income & Provisioning QI 2017 Net Income by Country [Net Income $112.03M; 3.51% YoY; 2010-2016 CAGR 5.79% ] ($M) QI 2017 % Total YoY 2016 2015 2014 2013 Net Interest Margin [Net Interest Income $170.62M; 2.19% YoY; 2010-2015 CAGR 5.69%] Lebanon 91.07 81.29 28.09 360.39 298.33 286.50 291.14 Egypt 11.65 10.40 (13.77) 53.23 43.34 33.14 20.92 Syria * NA NA NA NA 24.08 13.03 1.93 2.29% 2.29% 2.24% 2.33% 2.28% Jordan 3.38 3.02 (21.21) 15.17 17.79 16.46 11.67 2.18% UAE 2.20 1.96 (34.33) 10.76 7.41 6.68 4.99 2.12% 2.15% KSA 0.58 0.52 (50) 6.34 7.22 6.81 10.28 2.07% Qatar 0.30 0.27 (6.25) 1.17 2.42 (4.77) 1.28 Iraq (0.39) (0.35) 44.29 4.03 (9.27) (2.39) NA Europe 3.24 2.89 17.82 11.74 12.94 9.32 10.23 2009 2010 2011 2012 2013 2014 2015 2016 QI 2017 USD Interbank & Deposits (%) Net Provisions [(106.8%) YoY] ; NPLs 3.70 3.57 5.19 3.20 3.88 4.74 1.62 5.32 5.02 3.69 3.20 2.85 2.84 2.84 2.92 3.01 3.52 3.57 3.44% 5.44% 3.20% 39.26 105.06 4.89% 69.80 4.44% 41.27 4.40% 82.10 4.19% 1.20 2.93 0.69 0.35 0.32 0.44 0.27 0.23 0.98 1.05 2.69% 13.89 16.51 16.8 2.85% (0.31) 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Feb-17 2009 2010 2011 2012 2013 2014 2015 2016 QI 2017 Average Cost of Local USD Deposits Average Libor 3M Net Provisions ($M) Gross Non-Performing/Gross Loans * Deconsolidation of Syrian Operations 3/12
Fee Income QI 2017 Fee Income ($M)* [(13.04%) YoY; Ratio of Fee Income to Operating Income 2016 19.13%] Fee Income Breakdown by Type 167.38 173.51 182.51 Credit & Corporate Finance 6.1% 118.12 138.53 133.04 145.94 Trade Finance 8.6% Retail 22.2% 98.01 Others 3.8% Insurance 5.3% $41.07M 41.07 Private Banking 26.4% Asset Management & Custody 27.6% 2009 2010 2011 2012 2013 2014 2015 2016 QI 2017 *Includes Net Commissions & Fee income, Foreign Exchange Gain & Dividends Efficiency Ratio * Cost-to-Income 39.11% 70 % 37.99% 37.68% 57.24 52.66 53.72 58.71 59.62 57.80 57.23 53.94 64.78 47.81 35.58% 35.04% 36.39% 36.80% 35.90% 34.23% 52 % 2008 2009 2010 2011 2012 2013 2014 2015 2016 QI 2017 2009 2010 2011 2012 2013 2014 2015 2016 QI 2017 * Non-Interest Expenses / Total Revenue 4/12
Peer Group Analysis QI 2017 Net Income ($M) ROA ; ROE (Common) 112.03 110.19 28.74 15.45% 13.50% 53.87% 56.3% 5.77% 34.23% 1.50% 1.02% 0.55% Blom Audi Byblos Blom Audi Byblos Net Profits Cost to Income Ratio ROAA ROAE Financial Ratios Volatility of Return 16.33% 14.32% 12.43 8.05% 76.79 76.30 6.12 6.98 31.58 37.19 35.29 34.62 1.02 1.10 0.75 Blom Audi Byblos Price to Net Book Price to Earnings yield Blom Audi Byblos Mean Coefficient of Variation [Average Quarterly Return 2005 2016 ] [Quarterly Standard Deviation/Mean ] 5/12
1. Overview 2. Financial Information 3. Business Information 4. Share Information
Deposit Franchise QI 2017 Total Deposits ($Bn) [0.18 % YoY] * Total Deposits by Holder ** 17.97 19.61 20.30 21.79 22.57 24.01 25.09 24.81 25.25 Retail 13.39% $25.25Bn Corporate 16.16% Middle 34.33% HNW 36.12% 2009 2010 2011 2012 2013 2014 2015 2016 QI 2017 ** Retail < $100k ; Middle $100K -$1M ; HNW >$1M Deposits Breakdown by Country ($M) 2017 % Total YoY 2016 2015 2014 2013 Lebanon 21,068 83.43 4.62 20,597 19,868 19,047 18,052 Egypt 1,441 5.71 (30.65) 1,327 2,160 1,776 1,415 Jordan 844 3.34 (11.16) 875 921 905 813 UAE 669 2.65 16.15 637 554 526 510 Syria * 0 0 NA 0 254 362 435 Total Deposits by Currency (QIV 2016) EGP 6.30% Others 3.37% GBP 1.38% EURO 7.00% $24.81Bn LBP 30.26% Iraq 43 0.17 4.88 39 33 7 NA Qatar 11 0.04 57.14 7 6 40 87 Europe 1,176 4.66 0 1,329 1,295 1,343 1,260 USD 51.69% * Deconsolidation of Syrian Operations 6/12
Lending Business QI 2017 Growth of Total Net Lending ($M) [(2.31)% YoY] Loans to Deposits Ratio 5,178 5,591 6,028 6,345 6,910 7,196 7,164 7,111 22.37% 26.41% 27.55% 27.66% 28.11% 28.78% 28.68% 28.87% 28.16% 4,019 2009 2010 2011 2012 2013 2014 2015 2016 QI 2017 2009 2010 2011 2012 2013 2014 2015 2016 QI 2017 Breakdown of Lending by Countries ($M) 2017 % Total YoY 2016 2015 2014 2013 Lebanon 5,231 73.56 (0.4) 5,277 5,165 5,054 4,618 Egypt 489 6.89 (28.92) 470 721 582 465 Breakdown of Lending by Sector ** Project Finance 6.48% Real Estate 5.93% Jordan 500 7.03 (3.29) 512 507 456 438 UAE 375 5.27 32.51 359 294 287 248 Retail 41% $7.08Bn * SMEs 20.73% Qatar 97 1.36 2.11 91 86 93 139 Iraq 10 0.14 (16.67) 10 12 1 NA Syria * 0 0 0 0 0 20 51 Corporate 23.39% Securities 1.44% Syndicated Loans 1.03% Europe 409 5.75 (5.32) 444 411 417 386 ** Excluding related parties loans & insurance receivables * Deconsolidation of Syrian Operations 7/12
Retail Lending QI 2017 Growth of Retail Lending ($M) [(0.45 %) YoY] Personal Loans 12.13% Retail Loans Distribution by Product Credit Cards 4.68% 1,068 1,840 2,099 2,414 2,690 2,904 2,904 2,903 Lebanon, 82.88% Jordan, 13.19% $2.90Bn Car Loans 19.67% Egypt, 3.93% Syria, 0% Housing Loans 63.52% 2010 2011 2012 2013 2014 2015 2016 QI 2017 Breakdown of Retail Loans by Product ($M) Car Loans % Total YoY (%) Housing Loans % Total YoY(%) Personal Loans % Total YoY(%) Credit Cards % Total YoY(%) Lebanon 321 56.2 (0.31) 1,709 92.7 5.82 247 70.2 (3.14) 130 95.6 (1.52) Jordan 201 35.2 (6.07) 125 6.8 (3.85) 53 15.0 3.92 4 2.9 0 Syria * 0 0 0 0 0 0 0 0 0 0 0 0 Egypt 49 8.6 (46.15) 10 0.5 (9.09) 52 14.8 (40.91) 2 1.5 (33.33) * Deconsolidation of Syrian Operations 8/12
Business Segments QI 2017 Custody Business (AUMs $M) [6.40% YoY] Asset Management Business ($M) * 7,156 6,719 7,122 7,529 562.93 567.35 610.65 594.29 631.59 Blom Bond Fund, 51.2% 5,976 5,567 5,205 5,610 450.65 491.8 Blom Petra Balanced Fund, 0.5% Blom Money Market Fund, 34.3% 323.07 Blom Saudi Arabia Fund, 0.5% Blom Cedars Balanced Fund, 3.8% LBP MMF, 8.1% Arab Markets Fund, 1.5% 2010 2011 2012 2013 2014 2015 2016 QI 2017 2010 2011 2012 2013 2014 2015 2016 QI 2017 Brokerage Activity 2016 US ($M) Insurance Business - Premium ($M) 4,724 9.4 108 47 79.64 68.99 45.39 63.74 70 68.34 75.11 36.70% 4.38% 0.27% Lebanon Jordan Egypt 33.20 37.20 39.08 45.32 37.93 43.66 41.49 42.28 16.18 7.70 2009 2010 2011 2012 2013 2014 2015 2016 QI 2017 BLOMINVEST market share Total trading per stock market Life Non-Life 9/12
1. Overview 2. Financial Information 3. Business Information 4. Share Information
BLOM BANK Share Performance QI 2017 Earnings Per Common Share ($) * Analyst Coverage 1.46 1.48 1.53 1.58 1.60 1.86 2.20 2.09 Institution Recommendation Target Price ($) Date EFG-Hermes Buy 14.00 May 2017 FFA Private Bank Overweight 12.50 May 2017 Arqaam Capital Buy 16.60 May 2017 EVA Dimensions Hold NA Jun 2016 HSBC Hold 11.00 Feb 2016 Deutche Bank Buy 12.25 Aug 2015 2010 2011 2012 2013 2014 2015 2016 QI 2017 * Annualized Dividends Pay-Out(%) & Dividends per Common Share($) BLOM GDR Trading on Beirut & London Stock Exchanges ($)* 0.45 0.45 0.45 0.50 0.66 41.9 0.83 44.92 0.99 49.16 IOB BSE Total Daily Average 2010 180,781,087 74,578,727 255,359,814 1,063,999 2011 75,730,415 13,043,123 88,773,538 369,889 2012 132,425,915 31,296,393 163,722,308 682,176 31.5 30.99 30.15 32.2 2013 35,012,956 13,481,017 48,493,973 202,058 2014 90,556,591 20,714,978 111,271,569 463,631 2015 78,783.936 20,348,525 99,132,461 550,736 2016 90,786,621 91,096,800 181,883,421 757,848 2010 2011 2012 2013 2014 2015 2016 Dividend Payout Ratio Dividend Per Share QI 2017 27,942,461 9,290,703 37,233,164 271,803 *BLOM BANK Executed a share split of 1/10 for a total of 215 M shares in October 2010 10/12
BLOM BANK Shares QI 2017 Common Shares GDR DR Program Preferred Shares 215,000,000 73,896,010 (34.37% of Total Common) 20,000,000 1998 BLOM Bank had 18,500,000 Common shares in two categories: -Category A:6,168,000 -Category B:12,332,000 Of which 4,389,601(23.72%) were listed as GDR at $ 33 each. 2001 (July) BLOM Bank consolidated the two categories into one. 2006 (February) BLOM Bank increased its capital by $276m through the issuance of 3,000,000 new Global Depository Shares at $92 per share. The GDS were listed on the Luxembourg and Beirut Stock Exchanges. 2006 (August) BLOM Bank listed 7,166,667 common(one third of all common shares) on the BSE. 1998 BLOM Bank issued 4,389,601 Global Depositary Receipts worth $144.9m.The issue was a secondary issue(no increase in Capital) at $ 33 each. 2006 (February) BLOM Bank increased its capital by $276m through the issuance of 3,000,000 new Global depository Shares at $92 per share. The GDS were listed on the Luxembourg and Beirut Stock Exchanges. The total number of GDR s was increased to 7,389,601(34.37%) 2010 (October) BLOM Bank executed a share split of 1/10 for a total of 73,896,010 GDRs. DR Ticker: BLBD - CUSIP:093688109 - DR ISIN: US0936881095 - Ratio: 1:1 - Depositary: Bank of New York - Effective Date: Jan 20,1998 - Underlying ISIN: lb0099221105 - Underlying SEDOL: 5400597 - Country: Lebanon - Industry: Banks 2002 BLOM Bank issued 750,000 unlisted preferred shares(class 2002),Coupon:10%-15% 2004 BLOM Bank issued 750,000 unlisted preferred shares(class 2004),Coupon:8.5% 2005 BLOM Bank issued 1,000,000 unlisted preferred shares(class 2005),Coupon:8.5%-9.5% 2006 (August) BLOM Bank lists all preferred shares on the BSE 2008 (June) BLOM Bank redeemed all preferred shares class 2002, totaling 750,000 shares to reduce the total preferred shares to 1,750,000 2008 (June ) BLOM Bank listed all its shares on the Beirut Stock Exchange (BSE). 2010 (October) BLOM Bank executed a share split of 1/10 for a total of 215M shares. 2011 (June) BLOM Bank redeemed its Preferred shares Classes 2004 and 2005. 2011(July) * BLOM Bank issued 20 million non-cumulative perpetual redeemable preferred shares (Class 2011), Coupon: 7% * Called in March 2017 11/12
BLOM BANK Shareholders QI 2017 Rest of Shareholders 26.77% Bank of NEWYORK* 34.37% Khoury Family 1.89% BLOM Bank Shareholders Saade Family 2.55% Jaroudi Family 2.68% Chaker Family 4.83% Banorabe S.A SPF** 17.55% Azhari Family 7.53% Actionnaires Unis 1.83% Starting 1998, and after the issuance of Global Depository Receipts (GDR) by BLOM Bank Shareholders, the Bank of New York as Depository, became shareholder on the Bank s register ** The major shareholders of Banorabe S.A. SPF (formerly Banorabe Holding S.A.) are the same as in BLOM Bank (except Bank of New York) 12/12
Disclaimer The information contained in this presentation has been prepared by BLOM Bank.It has not been fully verified and is subject to material updating, revision and further amendment. 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( Forward-looking statements ).Such forward-looking statements are by their nature subject to significant uncertainties and contingencies and are based on a number or estimates or assumptions that are subject to change(ad in many cases are outside the control of BLOM Bank and its directors) which may cause the actual results or performance of BLOM Bank 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, BLOM 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 BLOM Bank s financial condition, status or affairs or any change in the events, conditions or circumstances on which a statement is based. 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. To the maximum extent permitted by law, neither BLOM Bank 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. This presentation should be read in conjunction with other publicity available material. Further information including historical results and a description of the activities of BLOM Bank is available on our website, www.blom.com.lb