Banking (Neutral ) HLIB Research PP 944/12/12 (313) INDUSTRY INSIGHT il 1, Feb Stats Mixed Latest Trends Our Take Risks Rating Top Picks Loans growth for Feb decelerated to.7% vs. 11% in Jan as business growth decelerated while household grew at slightly lower rate. Applications increased slightly but approvals fell. Levels are still relatively low while approval rate fell below 5% mark. LD ratio slightly higher as deposits growth continued to lag loans growth. Although excess liquidity decline, it is still ample at RM26.6bn. Average lending rate (ALR) declined sharply. Asset quality sustained but mixed in terms of purposes with improvement from business related but deterioration from household related. Transport ratio highest since Feb. Capital ratios higher and remained robust. Maintain loans growth projection of % for (2x HLIB s GDP growth forecast of 5%), despite.7% in Feb, on higher base ahead and low levels of leading indicators. This will be partly offset by resumption of pressure on NIM. Expect asset quality to continue hold up well. Our sensitivity study (see report dated 2 Jan ) shows that, in worst case scenario, rise in delinquencies will only slow but not derail sector s earnings growth. On the other hand, continued deterioration in transport and household related purposes reaffirm our view that rate of overall asset quality improvement will slow and provision would no longer be the main earnings driver. Robust capital ratios to support active capital management, especially with several banks adopting DRP. Risk of recession and its impact on asset quality, portfolio losses (MTM and realized), non-interest income growth as well as more macro prudential measures. NEUTRAL ( ) Positives Best proxy to the impact of ETP (sector with third highest multiplier effect), domestic consumerism (albeit slower) and economy, strong asset quality, robust capital ratios, capital management and M&As. Negatives Competitive pressure on margin, potential of recession which would increase the possibility of rise in delinquencies, portfolio losses from foreign outflow and rising burden of low income group. Maybank and RHB Cap. Low Yee Huap, CFA yhlow@hlib.hongleong.com.my (63) 216 7 Sector NPL/IL (RMm) 7, 65, 6, 55, 5, 45,,, 3,, Gross NPL/IL (LHS) Gross NPL/IL ratio (RHS) Net NPL/IL ratio (RHS), Jun-99 Jun- Jun-1 Jun-2 Jun-3 Jun-4 Jun-5 Jun-6 Jun-7 Jun- Jun-9 Jun- Jun-11 Jun-12 Jun-13 Sector LLC 5 95 9 5 75 7 65 6 55 5 45 J-99 J- J-1 J-2 J-3 J-4 J-5 J-6 J-7 J- J-9 J- J-11 J-12 J-13 J- Sector Capital Ratios 16... 13. 12. 11.. 9.. CET1 RWCAR Core capital ratio 9 9 99 1 2 3 4 5 6 7 9 11 12 13 Mkt Cap Price Target +/- EPS (sen) P/E (x) P/B (x) ROE Net Company (RMbn) (RM) (RM) Reco. CYE CYE CYE CYE CYE CYE CYE CYE Yld Public Bank - F 64.4 19. 19. -.6 Hold 121.3 13.2..7 3.2 2. 21.1.2 2.9 Public Bank - L 64.2 19.16 19. -.4 Hold 121.3 13.2..7 3.1 2. 21.1.2 2.9 Maybank 1.7 9.6 11.9 23. Buy 77.6 1.5 12.5 11.9 1. 1.7.9.6 5.6 CIMB Grp 53.1 7. 7.74.3 Hold 61.1 66.3 11.7 11.5 1. 1.4.5 13.4 3.4 AMMB 21.6 7.1 7.3 9.1 Hold 57.7 63.7 12.4 11.3 1.7 1.5.1.4 3.1 Affin Holdings 5. 3.7 4.26.1 Hold 43.7 44.2.6.5.9..5. 4. AFG 6. 4.41 5.24 1. Hold.4 3.1 12.4 11.6 1.6 1.5 13.3 13.5 4.1 RHB Capital 21..42 9.59 13.9 Buy 73.4 3.7 11.5.1 1.3 1.2 11.5 12. 2.9 Average 12. 11.9 1.9 1.7.4. HLIB 16 12 6 4 2 Page 1 of 1 il
Loan Growth s monthly statistics for Feb show that loans growth decelerated to.7% yoy vs. 11% in Jan (see Figure #1) as disbursement fell to RM73.6bn vs. RM95bn in Jan or a 12.2% yoy growth vs. 22.3% in Jan. The deceleration was due to the business segment whereby loans growth decelerated to 9.6% vs. % in Jan while the household segment also decelerated slightly to 11.% vs. 11.9% in Jan (see Figure #2). Absolute amount increased mom by RM3.1bn vs. RM11.bn in Jan (see Figure #3). On mom basis, however, loans growth deccelerated to.% vs..97% in Jan. Loan growth decelerated to.7% yoy Figure #1 Loans Growth (RMbn) 1 Loan (RMbn - LHS) Loan Growth (% yoy - RHS) 1 9 12 7 6 5 6 4 2 Figure #2 Loans Growth Breakdown 1 16 12 6 4 2 Business Household Business growth decelerated while household slightly slower 7 9 11 12 13 Figure #3 Absolute mom change in total loans, Loan Growth (mom change - RMm), Monthly absolute amount increase was lower,, 5, 1 2 3 4 5 7 9 11 12 13 1 2 3 4 5 7 9 11 12 13-5, -, Page 2 of 1 il
In terms of loans by purpose, the deceleration in overall loans growth can be attributed to personal use and working capital (both absolute amount and yoy growth lower) as well as purchase of securities, transport, non-residential property and fixed assets (higher absolut amount but low yoy growth). These were partly offset by residential property, construction and others (higher absolute amount and yoy growth) as well as credit cards (lower absolute amount but higher yoy growth) (see Figures 4-13). Loan by purpose reflecting deceleration in loans growth Figure #4 Purchase of Securities (RMbn) Purchase of securities (LHS) % yoy (RHS) 1 Figure #5 Transport Vehicles (RMbn) Transport vehicles (LHS) % yoy (RHS) 165 11 65 5 55 45 6-5 1 1 1 5 9 7 6 5 4-7 9 11 12 13 95 3 7 9 11 12 13 Figure #6 Residential Prop 3 (RMbn) Residential property (LHS) % yoy (RHS) 7 7 9 11 12 13 13 12 11 9 Figure #7 Non-Residential Prop (RMbn) 16 1 1 6 Non-residential property (LHS) % yoy (RHS) 11 7 9 11 12 13 24 23 22 21 19 1 17 16 13 12 Figure # Fixed Assets (RMbn) Fixed assets (LHS) % yoy (RHS) 9 7 6 5 4 3-5 7 9 11 12 13 55 45 5 Figure #9 Personal Used 56 52 4 44 36 32 2 24 (RMbn) Personal use (LHS) % yoy (RHS) 2 7 9 11 12 13 22 1 16 12 6 4 Page 3 of 1 il
Figure # Credit Card (RMbn) Credit card (LHS) % yoy (RHS) 33 31 29 27 23 21 19 17 7 9 11 12 13 Figure #12 Working Cap (RMbn) Working capital (LHS) % yoy (RHS) 3 29 16 2 27 26 12 2 23 2 6 2 4 19 2 1 17 16-2 7 9 11 12 13 22 1 16 12 6 4 2 Figure #11 Construction 33 31 29 27 23 21 19 17 Figure #13 Others 75 7 65 6 55 5 45 3 (RMbn) Construction (LHS) % yoy (RHS) - 7 9 11 12 13 (RMbn) Others (LHS) % yoy (RHS) 6-7 9 11 12 13 3 5-5 - - 5 3 - - -3 Loan Leading Indicators Loan applications improved mom (after two consecutive month of decline) to RM57.3bn vs. RM54.1bn in Jan while yoy comparison revered to a growth of.5% vs. contraction of.% in Jan (see Figure #). The increase was mainly due to the business segment which increased mom to RM27.4bn vs. RM21.7bn in Jan or a growth of.5% vs. 19.5% contraction in Jan. Meanwhile, household segment fell to RM29.9bn vs. RM32.3bn in Jan but still managed to record a growth of.6% vs. 11.3% contraction in Jan (see Figures #-16). Thus, 3-month moving average decreased to RM57bn vs. RM63.1bn in Jan, below the RM7bn mark for the second consecutive month and after six consecutive months above while yoy contracted by 9.6% vs. 9.% contraction in Jan. Applications higher due to business but household lower Figure # Loan Application 75 65 55 45 Application (RMbn - LHS) % yoy (RHS) 1 9 7 5 3 - -3 5 6 7 9 11 12 13-5 Page 4 of 1 il
Figure # Business Application Application (RMbn - LHS) % yoy (RHS) 45 13 1 9 3 7 5 3 - -3 5-5 5 6 7 9 11 12 13 Figure #16 Household Application 45 Application (RMbn - LHS) % yoy (RHS) 7 5 3 3-5 -3 5 6 7 9 11 12 13 Figure #17 Loan Application 3-mth moving average (RMbn) 3-mth moving average (RMbn - LHS) % yoy (RHS) 75 7 65 6 55 5 45 3 5 6 7 9 11 12 13 7 6 5 3 - - -3 3-month simple moving below RM7bn for two consecutive month, after six consecutive month above Loan approvals, however, declined mom to RM27.1bn vs. RM2.4bn in Jan or a growth of 9.5% yoy vs..1% contraction in Jan, below the RM3bn mark for the second consecutive month, after tenth consecutive month above (see Figure #1). The decline was mainly due to the household segment which declined to RM16.5bn vs. RM19.1bn in Jan but yoy growth accelerated to.3% vs. 3.% in Jan. This was partly offset by the business segment which increased to RM.5bn vs. RM9.3bn in Jan or a growth of 11.4% vs. 7.3% contraction in Jan (see Figures #19-). As a result, the 3-month simple moving average absolute amount fell to RM29.5bn vs. RM31.1bn in Jan, below the RM3bn level since Mar 13 but yoy growth accelerated to 9.% vs. 2.% in Jan, seventh consecutive month of positive grwth (see Figure #21). Loan approvals declined Figure #1 Loan Approval Approval (RMbn - LHS) % yoy (RHS) 1 9 7 3 5 3 - -3 5 6 7 9 11 12 13-5 Page 5 of 1 il
Figure #19 Business Approval 24 Approval (RMbn - LHS) % yoy (RHS) 19 9 19 1 9 - Figure # Household Approval 24 Approval (RMbn - LHS) % yoy (RHS) 7 22 6 5 1 3 16 12 - - 4-6 5 6 7 9 11 12 13 6-3 5 6 7 9 11 12 13 Figure #21 Loan Approval 3-mth moving average 37 33 31 29 27 23 21 19 17 13 11 9 (RMbn) 3-mth moving average (RMbn - LHS) % yoy (RHS) 1 2 3 4 5 6 7 9 11 12 13 9 7 6 5 3 - - -3-3-month simple moving average fell below RM3bn Given higher applications but lower approvals, approval rate (approval divided by application) fell below the 5% mark after two consecutive month above or at 47.3% vs. 52.4% in Jan (see Figure #22). Both business and household approval rate fell to 3.5% vs. 42.7% in Jan and 55.4% vs. 59% in Jan. Approval rate back below the 5% mark Figure #22 Approval Rate 75 7 65 6 55 5 45 5 6 7 9 11 12 13 Although loans growth of.7% is ahead of our % projection (or 2x HLIB s GDP projection of 5%) for, we are not changing given the higher base ahead and the recent decline in leading indicators. We continued to expect stronger business segment loans growth but partially offset by the expected slowdown in the household segment following various subsidy removals and measures to cool the property sector. Maintained loans growth projection at % Page 6 of 1 il
Deposits & LD Ratio Deposits growth also deccelerated to 7% yoy vs. 7.2% in Jan (see Figure #23). On mom basis, deposits grew by.4% vs..6% contraction in Jan. Given that the mom deposits growth (.4%) lagged behind the mom growth in loans (.%), LD ratio increased but remained healthy at around the % mark (see Figure #24). As for excess liquidity as measured by deposits/loans gap, it declined to RM26.6bn from RM29bn in Jan, still ample to fund domestic economic growth. Deposits fell mom but excess liquidity remained ample at RM27bn Figure #23 Deposits 1 (RMbn) Deposit (RMbn - LHS) Deposits Growth (% yoy - RHS) 1 6 5 2 3 4 5 6 7 9 11 12 13 Figure #24 LD Ratio % 95% 9% LD ratio slightly higher 5% % 75% 7% 199 1999 1 2 3 4 5 7 9 11 12 13 Lending Rate Average lending rate (ALR) declined 9bps to 4.44% vs. 4.53% in Jan. Meanwhile, spread (vs. 3-month KLIBOR) also declined but by larger magnitude of 17bps to 1.% vs. 1.32% in Jan as the 3-month KLIBOR increased by bps to 3.29% vs. 3.21% in Jan (see Figure #). The resumption of decline in both the ALR and spread will again put pressure on NIM in 1QCY. Both ALR and spread declined sharply Page 7 of 1 il
Figure # ALR & Spread Over 3-mth KLIBOR 7.5 Avg. Lending Rate (LHS) Interest Spreads (RHS) 7. 6.5 6. 5.5 5. 4.5 4.5 4. 3.5 3. 2.5 2. 1.5 1..5 4. - 1 2 3 4 5 7 9 11 12 13 Asset Quality Gross and net IL (impaired loans) ratios were flattish at 1.4% and 1.3% vs. 1.4% and 1.3% in Jan, respectively (see Figures #26). Overall, we continue to expect asset quality to hold up given strong financial position of both the business and household segment as well as stable job market, albeit high household debt and rising inflation. Moreover, our sensitivity analysis shows that in the worst case scenario, a rise in delinquencies will only slow but not derail banks earnings (please see out reported entitled IL RISK? Will Slow But Not Derail Growth dated 2 Jan ). The anaylysis is also largely in line with s Stability Report whereby despite various stress tests undertaken by the central bank, the system remained healthy and able to withstand extreme economic conditions as well as massive outflow. Meanwhile, LLC improved (for the third consecutive month) to 4.5% vs. 4.1% in Jan mainly due to increase in Collective Allowance (a function of loans growth) while Individual Allowance was slilghtly higher but remained below the RM7bn mark for the third consecutive month (see Figure #27). Asset quality remained strong while coverage improved on CA Figure #26 IL Absolute and Ratios (RMm) 7, Gross NPL/IL (LHS) Gross NPL/IL ratio (RHS) Net NPL/IL ratio (RHS) 65, 6, 16 55, 12 5, 45,,, 3,, 6 4 2, Jun-99 Jun- Jun-1 Jun-2 Jun-3 Jun-4 Jun-5 Jun-6 Jun-7 Jun- Jun-9 Jun- Jun-11 Jun-12 Jun-13 Page of 1 il
Figure #27 LLC 5 95 9 5 75 7 65 6 55 5 45 J-99 J- J-1 J-2 J-3 J-4 J-5 J-6 J-7 J- J-9 J- J-11 J-12 J-13 J- LCC improved on CA while IA slight higher but below the RM7bn mark for three consecutive month In terms of absolute gross IL amount, it increased mom by RM6.3m vs. RM.m in Jan (see Figure #2). Gross amount increased Figure #2 Gross IL Change (RMm) 3, Gross NPL/IL - mom chg (RMm) Gross NPL/IL ratio 2, 1, - (1,) (2,) (3,) Jun-2 Dec-2 Jun-3 Dec-3 Jun-4 Dec-4 Jun-5 Dec-5 Jun-6 Dec-6 Jun-7 Dec-7 Jun- Dec- Jun-9 Dec-9 Jun- Dec- Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13. 13. 11. 9. 7. 5. 3. 1. As for gross IL by purpose, there were mixed performances as improvements were recorded by (mainly business related) purchase of securities, non-residential property, fixed assets, construction and working capital. However, these were offset by deteriorations (mainly household related) in transport, residential property, personal use, credit cards, consumer durables and others. HP has deteriorated to highest level since Feb. The continued deterioration in certain pruposes despite stable overall ratio suggests that certain segment(s) are facing some stress and need to be monitored closely. Moreover, it also suggests that previouls earnings driver of the industry (improving asset quality resulting in declining provision) is unlikely to continue drive growth. IL by purpose mixed, most business segments improved but most household segments deteriorated Figure #29 Purchase of Securities (RMmn) Purchase of securities (LHS) % (RHS) 12.. Figure #3 Transport Vehicles (RMmn) Transport vehicles (LHS) % (RHS) 4.5 3 4.. 33 3.5 5 6. 4. 2. 2 23 1 3. 2.5 2. 1.5. 7 9 11 12 13 13 1. 7 9 11 12 13 Page 9 of 1 il
Figure #31 Residential Prop (RMmn) 16 Residential property (LHS) % (RHS) 12 6. 9.. 7. 6. 5. 4. 3. 2. Figure #32 Non-Residential Prop (RMmn) Non-residential property (LHS) % (RHS) 5 12. 45.. 3 6. 4. 2. 4 1. 7 9 11 12 13. 7 9 11 12 13 Figure #33 Fixed Assets Figure #34 Personal Used (RMmn) Fixed assets (LHS) % (RHS) 7 9. (RMmn) Personal use (LHS) % (RHS) 9. 6 5. 7. 6. 5. 19 17. 7. 6. 5. 3 4. 3. 2. 13 1 4. 3. 2. 1. 7 9 11 12 13 9 1. 7 9 11 12 13 Figure # Credit Card Figure #36 Construction (RMmn) Credit card (LHS) % (RHS) 75 7 65 6 55 5 45 4. 3.5 3. 2.5 2. 1.5 (RMmn) 39 3 29 2 19 Construction (LHS) % (RHS) 22.. 1. 16.. 12... 6. 1. 7 9 11 12 13 1 4. 7 9 11 12 13 Page of 1 il
Figure #37 Working Cap 17 16 1 13 1 1 9 (RMmn) Working capital (LHS) % (RHS) 3. 7 9 11 12 13 11.. 9.. 7. 6. 5. 4. Figure #3 Others (RMmn) 53 4 43 3 33 2 23 1 13 Others (LHS) % (RHS). 7 9 11 12 13 1. 16.. 12... 6. 4. 2. Capital Position Since Jan 13, introduced a new table (number 1.29a to replace table 1.29 under Basel II) for capital ratios under Basel III (but without historical numbers). Figure 39 shows that CET1, Tier 1 and RWCAR ratios increased by 6bps, 6bps and 12bps to 12.6%, 12.2% and.43% vs. 12%, 12.76% and.31% in Jan, respectively. Overall capital position remained robust and we continued to believe that Malaysia banks are well positioned to face potential external shocks and are also in position to continue with their relatively more active capital management, especially with three listed banks (CIMB, Maybank and RHB Cap) already undertaking dividend reinvestment plan (DRP) while AMMB also has an approved DRP but has not utilize this option yet. Increased and still well capitalized under Basel III, thus, active capital management will continue especially with DRP Figure #39 Capital Ratios CET1 16. RWCAR. Core capital ratio. 13. 12. 11.. 9.. 9 9 99 1 2 3 4 5 6 7 9 11 12 13 Figure # Recommendation, target prices and basis Company Rec Target Price (RM) Basis Affin Hold 4.26 Gordon Growth ROE of.% and WACC of.% AFG Hold 5.24 Gordon Growth ROE of 13.6% and WACC of.3% AMMB Hold 7.3 Gordon Growth ROE of.6% and WACC of 11.3% CIMB Grp Hold 7.74 Gordon Growth ROE of 13.7% and WACC of.5% Maybank Buy 11.9 Gordon Growth ROE of.9% and WACC of 9.7% Public Bank Hold 19. Gordon Growth ROE of.% and WACC of.% RHB Cap Buy 9.59 Gordon Growth ROE of 11.9% and WACC of.6% HLIB Page 11 of 1 il
Figure #41 Valuations vs. regional peers Valuations P/E (x) P/B (x) ROE ((P/B)/ROE)* Malaysia 13 13 13 13 AFFIN.9..1.9...5..1.6.4 7. AFG 12.4 11.3.4 1.6 1.5 1.4 13.3 13.5 13. 11..9. AMMB 12.2 11. 9. 1.7 1.5 1.4.1.4. 11..6 9.3 CIMB 12.2 11.9.9 2.1 2.1 1.9.5 13.4.1 13.6.7 13.7 HLBank 11.6. 1.9 1. 1.6 1.5.9.6.6 12.1 11.1.2 MayBank 13.1 12.5 11.5 1.9 1. 1.7.9.6.2 12.5 12.3 11.2 Public 16.5.4. 3.3 2.9 2.7 21.1.2 19..7.6 13.4 RHB Cap 11.7.3 9.5 1.3 1.2 1.1 11.5 12. 11.9 11.1 9.9 9.1 Average 12.3.1 9.5 1. 1.7 1.6.5.1.3 12.1 11.7.6 Singapore DBS.5 9.4.4 1.1 1. 1.. 11.2 11..2 9.2.1 UOB 11.6.7 9.6 1.3 1.2 1.1 11.4 11.5 12.3 11.3.4 9.3 OCBC 11.6.5 9.4 1.3 1.2 1.1 11.3 11.6 12.6 11.1.1. Average 11.2.2 9.1 1.2 1.1 1.1 11.2 11.4 12.2.9 9.9.7 Indonesia BCA 16.3.2 12. 3.5 2.9 2.4 22.9 22.1 21.6.3 13.3 11.3 Danamon.1. 7.7 1.2 1.1 1. 12.5 13.2 13.4 9..5 7.5 Mandiri 11.3 9.6.3 2.2 1.9 1.6.5.9.6.7 9.1 7. BNI 9.7.4 7.2 1.6 1.4 1.2 1. 1.1 1. 9.2. 6.5 BRI.2 9. 7. 2.4 2. 1.7 26.2 24.5 23.6 9.3.3 7.2 Average 11.5..6 2.2 1.9 1.6. 19.7 19.6.9 9.4.1 Thailand Bangkok. 7.9 7.4 1.1 1..9 12.4 12.6 12..6 7.7 7.1 Ayudhya 13.6 11.3.5 1.7 1.5 1.4 12. 13.4 13.5 13.3 11.2.4 Kasikorn 9.5.3 7.6 1.7 1.4 1.3 19. 1.7 17.7. 7.7 7.3 Krung Thai 7.7 6. 6.1 1.2 1..9.7 16.1.9 7.3 6.5 6. Siam Comm.1 9..2 1.9 1.7 1.5.1 19.6 1.9 9.4.5 7.9 Average 9.9.7. 1.5 1.3 1.2 16. 16.1. 9.5.3 7.7 HK BEA..1 9.3 1. 1..9 9.9.1.4.4 9.6. BOC 4.7 4.4 3.9.7.7.6 16.5.9 16.1 4.5 4.2 3.7 Dah Sing 9.5 9..1.9.9..1..3 9.1.6 7.6 Wing Hang 1.6 17.3.9 1.7 1.6 1.5 9.3 9.5 9. 17. 16.5.9 Average.9.2 9.3 1.1 1..9 11.4 11.4 11.6.5 9.7.7 China BOC 4.2 3.9 3.7.7.6.6 17.1 16.3.7 4. 3. 3.6 BoComm 4.3 4. 3.9.7.6.5.2.5 13.9 4.4 4.1 3.9 China Citic 5.2 4.6 4.4..7.6 17.2 17.3.6 4.9 4.3 4.1 China Cons 4.2 4.1 3.6..7 N/A 1. 17.6 N/A 4.2 4.1 N/A China Merc 4.1 3.7 3.2..7.6.1 19. 19. 3.9 3.5 3. ICBC 4.7 4.3 4..9..7 21.2.1 19. 4.3 4.1 3. Agri Bank 4.3 4. 3.5..7.6 19.4 1.4 19.2 4.1 3.9 3.3 Average 4.4 4.1 3.7..7.6 1.4 17.7 17.2 4.3 4. 3.6 Bloomberg, HLIB Page 12 of 1 il
Financial Projections - Affin Income statement Quarterly financial summary FYE 31 Dec (RMm) 12A 13A E E 16E FYE 31 Dec (RMm) 4Q12 1Q13 2Q13 3Q13 4Q13 Net Interest Income 1,72.6 1,94.9 1,175. 1,26. 1,345.6 Net Interest Income 27.9 265.9 273.7 21.7 273.6 Non-Interest Income.1 39.3 44. 4.3 513.9 Non-Interest Income 9.2 95.9 96.2.3 9. Operating Income 1,4.6 1,45.2 1,624.7 1,741.1 1,59.5 Operating Income 36.1 361. 369. 32. 371.6 Overhead Expenses -7.3-716.6-73.1-72.4-29.4 Overhead Expenses -14.4-172.4-173.6-175.4-195.1 Pre-provision Profit 7.3 76.6 6.6 95.7 1,3.1 Pre-provision Profit 13.7 19.4 196.2 6.6 176.5 Loan Loss Provisions 1. 66.1-42.4-45.9-57. Loan Loss Provisions 19.9 13.1 17.6 4.6 3. Operating Profit 799.2 34.7 44.2 912. 973.1 Operating Profit 3.6 2.5 213.7 211.2 7.3 Associates 34.6 29.2 32.1.4 3.9 Associates.9 1. 5.1.6 12.5 Pretax Profit 33.7 63.9 76.3 94.2 1,12. Pretax Profit 212.4 3.5 21. 221. 219. Less: Tax -4. -213.9-219.1-237. -3. Less: Tax -52. -52.7-59.5-4. -52. Tax Rate 24.6 24.... Tax Rate 24.5.9 27.2 22. 24. Profit After Tax 62.9 65. 657.2 711.1 759. Profit After Tax 16.4. 9.3 173. 166.9 Minorities..... Minorities..... Net Profit 62.9 65. 657.2 711.1 759. Net Profit 16.4. 9.3 173. 166.9 Basic shares (m) 1,494.6 1,494.6 1,494.6 1,494.6 1,494.6 Basic shares (m) 1,494.6 1,494.6 1,494.6 1,494.6 1,494.6 Basic EPS (sen) 42.1 43.5 44. 47.6 5. Basic EPS (sen).7.1.7 11.6 11.2 Balance sheet Valuation ratios FYE 31 Dec (RMm) 12A 13A E E 16E FYE 31 Dec (RMm) 12A 13A E E 16E Cash 7,52 9,,62 11,643 12,691 Reported basic EPS (sen) 42.1 43.5 44. 47.6 5. Invt securities,13 9,542,1,6 11,1 Normalized basic EPS (sen) 42.1 43.5 44. 47.6 5. Loans 34,163 36,99,4 44,46 47,99 Normalized FD EPS (sen) 42.1 43.5 44. 47.6 5. Stat Reserve 1,57 1,545 1,64 1,36 2,1 PER (x) 9.2.9..1 7.6 Goodwill 1,7 1, 1, 1, 1, FD PER (x) 9.2.9..1 7.6 Other assets 1,167 1,6 1,1 1,162 1,341 Net DPS (sen) 12.3..4 16.7 17. Total assets 55,34 59,952 64,917 7,31 76,13 Net DY 3.2 3.9 4. 4.3 4.6 Deposits 47,533 51,337 55,3 6,737 66,69 Book/ share (RM) 4. 4.3 4.6 4.9 5.2 Bills & acceptances 2 9 96 1 7 P/Book (x) 1..9.9..7 Borrowings 972 972 972 972 971 FCF/ share (sen) NM NM NM NM NM Other liab 1,132 1,175 1,7 1,241 1,275 FCF yield NM NM NM NM NM Shrhldrs' funds 6,45 6,377 6,4 7,266 7,76 Market capitalization 5,73 5,73 5,73 5,73 5,73 Share capital 1,495 1,495 1,495 1,495 1,495 Net cash NM NM NM NM NM Reserves 4,55 4,2 5,39 5,772 6,265 Enterprise value NM NM NM NM NM Minorities EV/ EBITDA (x) NM NM NM NM NM Total liab 55,34 59,952 64,917 7,31 76,13 ROE..5..1.1 FYE 31 Dec 12A 13A E E 16E FYE 31 Dec 12A 13A E E 16E Asset Quality Profitability Gross Impaired Loan 2.2 1.9 1.4 1.7 1.56 ROE.1.47 9.97.11. Loan Loss Coverage 71.3 74.3 53.11 54.29 5.63 ROA 1.16 1.13 1.6 1.6 1.4 Core Capital Ratio 11.59 11.2 11.44 11.27 11.9 Int Inc / Loans 6. 5.9 5.9 5.3 5.75 RWCAR 13.64 12.7 12.92 12.66 12. Int Exp / Deposits 2.91 2.3 2.1 2. 2.79 Cost / Inc Ratio 47.3 4. 45.43 44.94 44.6 Margins Exp / Avg. Assets 1.2 1.24 1.1 1.16 1.13 Yields On Earnings Assets 4.11 4.9 4.6 4.3 4. Prov / Avg. Net Loans -.6 -.19.11.11.12 Avg. Cost of Funds 2.59 2.63 2.63 2.63 2.63 Interest Spread 1.52 1.45 1.42 1.39 1.36 Liquidity Unadjusted NIM 1.67 1.61 1.59 1.56 1.52 Loan Deposit Ratio 79.55 77.94 7.29 7.29 7.26 Adjusted NIM 2.9 2.2 2. 1.9 1.95 Net Loan Growth 11.63 7.9 9.4 9..95 12A 13A E E 16E Deposit Growth 9..27 9. 9. 9. Page 13 of 1 il
Financial Projections - AFG Income statement Quarterly financial summary FYE 31 Mar (RMm) 12A 13A E E 16E FYE 31 Mar (RMm) 3Q13 4Q13 1Q 2Q 3Q Net Interest Income 924.1 972.6 1,42.7 1,121.3 1,2. Net Interest Income 23.9 244.7 23.3 244.4 3.3 Non-Interest Income 341. 36.9 37. 426.6 46.7 Non-Interest Income. 1.3 1.9 71.3 75.3 Operating Income 1,266. 1,333.5 1,43.5 1,547.9 1,671.5 Operating Income 319.7 5. 364.2 3.6 32.6 Overhead Expenses -591. -639.3-671.2-711.5-761.3 Overhead Expenses -2.2-171.7-174.9-4.3-3.7 Pre-provision Profit 674.2 694.2 759.3 36.4 9.2 Pre-provision Profit 167.5 13.3 19.3 171.3 14.9 Loan Loss Provisions 2.5 24.5-21.6-23.9 -.4 Loan Loss Provisions 12.9-4.2-5.4 4. -3.4 Operating Profit 676.6 71.7 737.7 12.5 4. Operating Profit 1.4 179.1 14. 176.2 11.5 Associates -2. -4.7-4. -4.9-5. Associates -1. -.... Pretax Profit 674.6 7. 732. 7.6 79. Pretax Profit 17.6 17.3 14. 176.2 11.5 Less: Tax -171.5-175.9-1.5-5.1-223.5 Less: Tax -45. -39.5-46.2-44.9-45. Tax Rate.4 24.6 24.6.4.4 Tax Rate.7 22.1.1.5 24. Profit After Tax 53.1 53.1 552.3 62.5 656.3 Profit After Tax 132. 13. 137. 131.2 136.5 Minorities -.5 -.1 -.1 -.1 -.1 Minorities..... Net Profit 52.6 53. 552.2 62.4 656.2 Net Profit 132.7 13. 137. 131.2 136.5 Basic shares (m) 1,54.1 1,54.1 1,54.1 1,54.1 1,54.1 Basic shares (m) 1,54.1 1,54.1 1,54.1 1,54.1 1,54.1 Basic EPS (sen) 32.5 34..7 3.9 42.4 Basic EPS (sen).6 9..9.5. Balance sheet Valuation ratios FYE 31 Mar (RMm) 12A 13A E E 16E FYE 31 Mar (RMm) 12A 13A E E 16E Cash 1974 5 79 39 Reported basic EPS (sen) 32.5 34..7 3.9 42.4 Invt securities 1 12479 133 1375 722 Normalized basic EPS (sen) 32.5 34..7 3.9 42.4 Loans 2449 27772 379 3432 37 Normalized FD EPS (sen) 32.5 34..7 3.9 42.4 Stat Reserve 1163 1331 77 16 14 PER (x) 13.6 12.7 12.4 11.3.4 Goodwill 5 6 6 6 6 FD PER (x) 13.6 12.7 12.4 11.3.4 Other assets 32 34 296 26 316 Net DPS (sen) 13.3 16.6 1. 19.5 21. Total assets 39719 43692 47591 516 56537 Net DY 3. 3. 4.1 4.4 4. Deposits 3434 3 41395 457 499 Book/ share (RM) 2.4 2.6 2. 3. 3.2 Bills & acceptances 74 79 4 9 P/Book (x) 1. 1.7 1.6 1.5 1.4 Borrowings 612 612 673 741 FCF/ share (sen) NM NM NM NM NM Other liab 97 957 1134 1347 162 FCF yield NM NM NM NM NM Shrhldrs' funds 3767 3 434 465 4936 Market capitalization 6,27 6,27 6,27 6,27 6,27 Share capital 4 4 4 4 4 Net cash NM NM NM NM NM Reserves 2219 242 2756 6 33 Enterprise value NM NM NM NM NM Minorities 5 5 5 5 5 EV/ EBITDA (x) NM NM NM NM NM Total liab 39719 43692 47591 516 56537 ROE.1 13. 13.3 13.5 13. FYE 31 Mar 12A 13A E E 16E FYE 31 Mar 12A 13A E E 16E Asset Quality Profitability Gross Impaired Loan 2.51 2.5 1.55 1.5.5 ROE.12 13. 13. 13.52 13.76 Loan Loss Coverage 7.7 2.47 9. 13.6. ROA 1.33 1.29 1.21 1.21 1.21 Core Capital Ratio 12.37 12.66 12.2 12.1 12. Int Inc / Loans 5.2 5.6 4.92 4.7 4.7 RWCAR.62.37.39.24.22 Int Exp / Deposits 2.3 1.94 1.95 1.95 1.95 Cost / Inc Ratio 46.75 47.94 46.92 45.97 45.55 Margins Exp / Avg. Assets 1.56 1.53 1.47 1.43 1. Yields On Earnings Assets 3.62 3.59 3.54 3.5 3.47 Prov / Avg. Net Loans -.1 -.9.7.7.7 Avg. Cost of Funds 1.96 1.9 1.9 1.9 1.9 Interest Spread 1.67 1.69 1.64 1.6 1.57 Liquidity Unadjusted NIM 1.3 1.3 1.7 1.74 1.71 Loan Deposit Ratio 76. 77.13 7.6. 1.7 Adjusted NIM 2.53 2.44 2.39 2.36 2.33 Net Loan Growth 12.41 13.1 11. 11.12.7 Deposit Growth 13.55 11.6 9. 9. 9. Page of 1 il
Financial Projections - AMMB Income statement Quarterly financial summary FYE 31 Mar (RMm) 12A 13A E E 16E FYE 31 Mar (RMm) 3Q13 4Q13 1Q 2Q 3Q Net Interest Income 2,97. 3,6. 3,272. 3,49.5 3,7.4 Net Interest Income 753.5 79.4 75.6 756.7 774.3 Non-Interest Income 2,11.2 2,574. 2,95.4 3,9. 3,437.2 Non-Interest Income 77.3 765.6.3.4.5 Operating Income 5,16. 5,6.7 6,17.2 6,649.4 7,7.6 Operating Income 1,5.9 1,555.9 1,594. 1,577.1 1,54. Overhead Expenses -2,634.7-3,322. -3,552.2-3,719.2-3,94.1 Overhead Expenses -9.6-993. -966.6-961.4-96. Pre-provision Profit 2,5.3 2,313.6 2,626.1 2,93.2 3,263.5 Pre-provision Profit 56.3 562.1 627.3 6.7 67. Loan Loss Provisions -491.7-134.7-1. -263.2-2. Loan Loss Provisions -42. -75.5.2 -.4-55.9 Operating Profit 2,33.6 2,179. 2,375.1 2,667. 2,92.7 Operating Profit 517.6 46.6 647.5 61.3 622.1 Associates..7.7.7.7 Associates.3.3 1.2 1.2 1.5 Pretax Profit 2,33.6 2,179.6 2,375. 2,667.7 2,93.3 Pretax Profit 517.9 46.9 64.7 62.5 623.5 Less: Tax -5.7-46.4-546.4-6.2-716. Less: Tax -1. -5.4-6.6-13.7-175.7 Tax Rate 24.6 22.3 23. 24. 24. Tax Rate 24.3.3 24.1 23. 2.2 Profit After Tax 1,532.9 1,693.2 1,29.4 2,27.4 2,267.3 Profit After Tax 392.1 436.5 492.1 463. 447. Minorities -4.5-5.1-56. -5. -61.7 Minorities 4.1-3.2-24.2-22.6-24.7 Net Profit 1,44.4 1,6.1 1,773.4 1,96.7 2,5.6 Net Profit 396.2 6.4 467.9 441.2 423.1 Basic shares (m) 3,.2 3,.2 3,.2 3,.2 3,.2 Basic shares (m) 3,.2 3,.2 3,.2 3,.2 3,.2 Basic EPS (sen) 49.2 54.2 5. 65.3 73.2 Basic EPS (sen) 13.1 13.5.5.6. Balance sheet Valuation ratios FYE 31 Mar (RMm) 12A 13A E E 16E FYE 31 Mar (RMm) 12A 13A E E 16E Cash 9,75 13,556,52,57 16,67 Reported basic EPS (sen) 49.2 54.2 5. 65.3 73.2 Invt securities 19,13,45 21,545 22,699 23,9 Normalized basic EPS (sen) 49.2 54.2 5. 65.3 73.2 Loans 75,63 2,56 9,3 97,73 6,339 Normalized FD EPS (sen) 49.2 54.2 5. 65.3 73.2 Stat Reserve 2.4 297.4 3169.1 3454.3 3765.2 PER (x).6 13.2 12.2 11. 9. Goodwill 1,955 3,246 3,246 3,246 3,246 FD PER (x).6 13.2 12.2 11. 9. Other assets 3,93 4,247 4,656 5,4 5,754 Net DPS (sen).1 22. 24. 26. 29. Total assets 112,923 126,993 136,975 7,53 9,76 Net DY 2. 3.1 3.3 3.6 4. Deposits 1,222,13 95,93 4,5 113,6 Book/ share (RM) 3.7 4. 4.3 4.7 5.2 Bills & acceptances 72 1,965 2,3 2, 2,3 P/Book (x) 1.9 1. 1.7 1.5 1.4 Borrowings,979,461,37 11,2 11,65 FCF/ share (sen) NM NM NM NM NM Other liab,9 13,421 13,969,542,1 FCF yield NM NM NM NM NM Shrhldrs' funds 11,111 12,33 13,3,26,6 Market capitalization 21,642 21,642 21,642 21,642 21,642 Share capital 3, 3, 3, 3, 3, Net cash NM NM NM NM NM Reserves,97 9,19,69 11,4 12,56 Enterprise value NM NM NM NM NM Minorities 3.9 1.1 1.1 1.1 1.1 EV/ EBITDA (x) NM NM NM NM NM Total liab 112,923 126,993 136,975 7,53 9,76 ROE 13.9.1.1.4. FYE 31 Mar 12A 13A E E 16E FYE 31 Mar 12A 13A E E 16E Asset Quality Profitability Gross Impaired Loan 2.45 1.9 1.6 1.3 1. ROE 13.6.13.12..77 Loan Loss Coverage 1.55 129.3 4.23 191. 24.19 ROA 1.37 1. 1.3 1.42 1.47 Core Capital Ratio 11.17 11.1.9.9 11.7 Int Inc / Loans 5.6 5.51 5.53 5.44 5. RWCAR.44.77.29.1. Int Exp / Deposits 2.5 2.67 2.76 2.76 2.76 Cost / Inc Ratio 51.6 5.95 57.49 55.93 54.41 Margins Exp / Avg. Assets 2.3 2.77 2.69 2.61 2.53 Yields On Earnings Assets 4.27 4.5 4.4 4.1 3.9 Prov / Avg. Net Loans.6.17.29.2.2 Avg. Cost of Funds 2.39 2.29 2.3 2.32 2.34 Interest Spread 1. 1.76 1.74 1.69 1.64 Liquidity Unadjusted NIM 2.13 2. 1.94 1.9 1.4 Loan Deposit Ratio 97.9 97.32 9.9 9.56 9.26 Adjusted NIM 2.9 2.76 2.69 2.66 2.63 Net Loan Growth 6.17..16.6.71 Deposit Growth 3.67 9.77 9. 9. 9. Page of 1 il
Financial Projections CIMB Group Income statement Quarterly financial summary FYE 31 Dec (RMm) 12A 13A E E 16E FYE 31 Dec (RMm) 4Q12 1Q13 2Q13 3Q13 4Q13 Net Interest Income 9,5.2 9,547.,4.4 11,261.4 12,129.3 Net Interest Income 2,.7 2,274.9 2,36. 2,413.6 2,49.5 Non-Interest Income 4,394.3 5,4.9 5,59.6 5,312.6 5,579.2 Non-Interest Income 1,5.1 1,67.9 1,4.5 1,66.7 1,262.9 Operating Income 13,479.5,631.9,474. 16,574. 17,7.5 Operating Income 3,5. 3,945.7 3,444.5 3,4.3 3,761.4 Overhead Expenses -7,612.1 -,457.9 -,373.3 -,74.7-9,6.2 Overhead Expenses -1,966. -2,219.6-2,42.4-2,59.3-2,136.6 Pre-provision Profit 5,67.4 6,174.1 7,.7 7,699.3,32.3 Pre-provision Profit 1,39. 1,726.1 1,2.1 1,421. 1,624. Loan Loss Provisions -347. -66.3-51.4-27. -2.2 Loan Loss Provisions -5. -3. -75. -2.3-317.3 Operating Profit 5,5.4 5,47. 6,249.3 6,71.4 7,474.1 Operating Profit 1,331. 1,643.2 1,326.3 1,2.7 1,37.6 Associates 7.5 361.4 165.4 173.6 12.3 Associates 39.6 75.3 6.1 175.5 5.5 Pretax Profit 5,677.9 5,49.2 6,4.7 7,45.1 7,656.4 Pretax Profit 1,371.4 1,71.5 1,36.4 1,36.3 1,.1 Less: Tax -1,21.1-1,2.4-1,411.2-1,549.9-1,64.4 Less: Tax -21. -316.1-3.4-37.5-31.4 Tax Rate 22.6 21.2 22. 22. 22. Tax Rate.5 1.4 22.7 22.2 22.2 Profit After Tax 4,396. 4,6. 5,3.5 5,495.2 5,972. Profit After Tax 1,9.6 1,2.4 1,71.1 1,7.7 1,56.7 Minorities -52. -6.4-75.3-2. -91.1 Minorities -. -16.2-16. -17. -1.4 Net Profit 4,344. 4,5.4 4,92.2 5,412.4 5,.9 Net Profit 1,1.6 1,36.2 1,54.3 1,61.7 1,3.3 Basic shares (m) 7,432. 7,729.3,229.3,229.3,229.3 Basic shares (m) 7,432. 7,432. 7,6.9 7,6.9 7,729.3 Basic EPS (sen) 5.5 5.7 59.9 65. 71.5 Basic EPS (sen).6 1.6 13. 13.9 13.4 Balance sheet Valuation ratios FYE 31 Dec (RMm) 12A 13A E E 16E FYE 31 Dec (RMm) 12A 13A E E 16E Cash,75 37,46 44, 47,537 51,339 Reported basic EPS (sen) 5.5 5.7 59.9 65. 71.5 Invt securities 63,576 64,559 69,724 75,31 1,326 Normalized basic EPS (sen) 5.5 5.7 59.9 65. 71.5 Loans 2,13 22,432 1,5 276,39 33,69 Normalized FD EPS (sen) 5.5 5.7 59.9 65. 71.5 Stat Reserve 5,265 6,362 6,946 7,5,293 PER (x) 12.2 12.2 11.9.9. Goodwill 9,5 9,63 9,63 9,63 9,63 FD PER (x) 12.2 12.2 11.9.9. Other assets 19,74 24,455 24,57 24,421 24,2 Net DPS (sen) 23.4 23. 24. 26.3 2.6 Total assets 336,461 37,913 5,96 4,524 47,4 Net DY 3.3 3.3 3.4 3.7 4. Deposits 262,1 23,732 3,2 339,3 371,4 Book/ share (RM) 3. 3.9 4.5 4.9 5.3 Bills & acceptances 4,7 4,713 4,949 5,196 5,456 P/Book (x) 1.9 1. 1.6 1.5 1.4 Borrowings 24,93 2,177 2,566 2,974 29,2 FCF/ share (sen) NM NM NM NM NM Other liab,337 23,262 24,594 26,33 27,57 FCF yield NM NM NM NM NM Shrhldrs' funds 2,293 3,271 36,77, 43,554 Market capitalization 56,719 56,719 56,719 56,719 56,719 Share capital 7,433 7,729,229,229,229 Net cash NM NM NM NM NM Reserves,6 22,542 2,549 31,796,3 Enterprise value NM NM NM NM NM Minorities 773 757 33 916 1,7 EV/ EBITDA (x) NM NM NM NM NM Total liab 336,461 37,913 5,96 4,524 47,4 ROE 16..5 13.4.1.1 FYE 31 Dec 12A 13A E E 16E FYE 31 Dec 12A 13A E E 16E Asset Quality Profitability Gross Impaired Loan 3. 3. 2.65 2. 1.65 ROE.9.51 13..9.7 Loan Loss Coverage 2.2 4.76 4.3 13.13 17.21 ROA 1.37 1.2 1.27 1.2 1.2 Core Capital Ratio 13.16 12.12 12. 12.71 13.19 Int Inc / Loans 6.49 6. 6.22 6. 6.4 RWCAR 16.34 13.4 13.34 13.. Int Exp / Deposits 2.4 2.56 2.55 2.54 2.53 Cost / Inc Ratio 56.47 57. 54.11 53.55 53.12 Margins Exp / Avg. Assets 2.39 2.39 2.16 2. 2.5 Yields On Earnings Assets 4.6 4.55 4.51 4.46 4.42 Prov / Avg. Net Loans.1.32.36.31.29 Avg. Cost of Funds 2.21 2.1 2. 2.22 2.24 Interest Spread 2.4 2.37 2.31 2.24 2.1 Liquidity Unadjusted NIM 2.56 2.46 2.43 2.39 2.34 Loan Deposit Ratio 1.74 6.5 6.7 6.74 6.73 Adjusted NIM 3. 2.96 2.92 2. 2.4 Net Loan Growth 9.39 12.7 9.9 9.95 9.99 Deposit Growth 11.43 6.... Page 16 of 1 il
Financial Projections - Maybank Income statement Quarterly financial summary FYE 31 Jun (RMm) 12A 13A E E 16E FYE 31 Jun (RMm) 4Q12 1Q13 2Q13 3Q13 4Q13 Net Interest Income 11,492.9 12,395.5 13,46.5,43.1,36.6 Net Interest Income 2,929.3 3,3.6 3,3. 3,111. 3,173.3 Non-Interest Income 5,162.5 5,992.4 6,569.4 7,27. 7,51.2 Non-Interest Income 1,37.2 1,441.7 1,773.9 1,71.6 1,39.3 Operating Income 16,655.5 1,37.,37.9 21,457.1 22,94.7 Operating Income 4,236.6 4,472.4 4,4.6 4,93.4 4,563.6 Overhead Expenses -,232.4 -,927.9-9,463.6 -,31.4 -,633.3 Overhead Expenses -2,1.2-2,296.6-2,329. -2,.1-2,334.2 Pre-provision Profit,423.1 9,459.9,574.3 11,4.7 12,271.4 Pre-provision Profit 2,126.4 2,175. 2,475.6 2,5.2 2,229.4 Loan Loss Provisions -679.2-729.6-1,249.3-1,296.4-1,21.6 Loan Loss Provisions -2.7-4.5-42.4-2.3 54.5 Operating Profit 7,743.,73.3 9,324.9,129.3,99. Operating Profit 1,9.7 2,91.3 2,47.2 2,37.9 2,23.9 Associates 2.5 139.3 3.2 16.5 15.4 Associates 34.1.5 41.6 44.5 17.7 Pretax Profit 7,96.3,69.6 9,47.1,297. 11,175.2 Pretax Profit 1,949. 2,126.7 2,.9 2,2.4 2,31.6 Less: Tax -1,977.6-2,9.3-2,369.5-2,574.5-2,793. Less: Tax -411.9-56.4-465.9-55.6-55.3 Tax Rate. 23.7... Tax Rate 21.1 26.7 22.3 23.7 22. Profit After Tax 5,91.7 6,771.3 7,.6 7,723.4,31.4 Profit After Tax 1,537.9 1,55.3 1,622.9 1,793. 1,796.3 Minorities -172. -21.9-229. -249.7-271. Minorities -7. -52.1-55.2-47.5-64.2 Net Profit 5,745.9 6,552.4 6,7. 7,474.7,112.4 Net Profit 1,459.9 1,56.2 1,567.7 1,746.3 1,732.1 Basic shares (m),4.,62.1,62.1,62.1,62.1 Basic shares (m),4.,4.9,697.3,726.1,62.1 Basic EPS (sen) 6.1 73.9 77.6 4.3 91.5 Basic EPS (sen) 17.3 17. 1.. 19.5 Balance sheet Valuation ratios FYE 31 Jun (RMm) 12A 13A E E 16E FYE 31 Jun (RMm) 12A 13A E E 16E Cash 51,96 55,224 6,747 65,66 7,55 Reported basic EPS (sen) 6.1 73.9 77.6 4.3 91.5 Invt securities 92, 7,672 11,439 127,9 13,7 Normalized basic EPS (sen) 6.1 73.9 77.6 4.3 91.5 Loans 311, 5,61 39,54 426,22 465,6 Normalized FD EPS (sen) 6.1 73.9 77.6 4.3 91.5 Stat Reserve 12,29 13,743,117 16,47 17,961 PER (x).2 13.1 12.5 11.5.6 Goodwill 6,531 6,41 6,41 6,41 6,41 FD PER (x).2 13.1 12.5 11.5.6 Other assets 19,469 22,6 22,642,376 2,233 Net DPS (sen) 52.5 53.5 54. 59. 64. Total assets 494,911 56,443 613, 667,642 726,343 Net DY 5.4 5.5 5.6 6.1 6.6 Deposits 31,43 437,75 41,5 524,62 572, Book/ share (RM) 5. 5.2 5.4 5.7 6. Bills & acceptances 2,27 1,97 2,16 2,4 2,645 P/Book (x) 1.9 1.9 1. 1.7 1.6 Borrowings 3,375 31,7,76 3,54 42,442 FCF/ share (sen) NM NM NM NM NM Other liab 37,9 41,76 44,97 49,232 53,6 FCF yield NM NM NM NM NM Shrhldrs' funds 42,95 45,997 4,91 5,336 52,774 Market capitalization 5,75 5,75 5,75 5,75 5,75 Share capital,4,62,62,62,62 Net cash NM NM NM NM NM Reserves 33,655 37,1 39,229 41,474 43,912 Enterprise value NM NM NM NM NM Minorities 1,719 1,745 1,975 2,2 2,496 EV/ EBITDA (x) NM NM NM NM NM Total liab 494,911 56,443 613, 667,642 726,343 ROE..9.6.2.7 FYE 31 Jun 12A 13A E E 16E FYE 31 Jun 12A 13A E E 16E Asset Quality Profitability Gross Impaired Loan 1.7 1.4 1.2 1.. ROE.1..62.19.73 Loan Loss Coverage 5.64 7.49 13.12.31 172.3 ROA 1.22 1. 1.17 1.17 1.17 Core Capital Ratio 13.66 13.6 12.49 12.6 11.67 Int Inc / Loans 4.95 4.53 4.52 4.47 4.39 RWCAR 17.47.66.7.26 13.71 Int Exp / Deposits 1.3 1.7 1.73 1.74 1.74 Cost / Inc Ratio 49.43 4.55 47.23 46.75 46.42 Margins 3.57 3.34 3.29 3.24 3.19 Exp / Avg. Assets 1.74 1.69 1.61 1.57 1.53 Yields On Earnings Assets 1.62 1.55 1.55 1.55 1.55 Prov / Avg. Net Loans.23.22.33.32.29 Avg. Cost of Funds 1.95 1.79 1.74 1.69 1.64 Interest Spread 2.12 1.96 1.91 1.5 1. Liquidity 9.2 9.9 9.2 9.6 9.96 Unadjusted NIM 2.62 2.54 2.47 2.43 2.3 Loan Deposit Ratio 12.52 13.. 9. 9. Adjusted NIM 1.7 1.4 1.2 1.. Net Loan Growth.32 13.96. 9. 9. 12A 13A E E 16E Deposit Growth 12A 13A E E 16E Page 17 of 1 il
Financial Projections Public Bank Income statement Quarterly financial summary FYE 31 Dec (RMm) 12A 13A E E 16E FYE 31 Dec (RMm) 4Q12 1Q13 2Q13 3Q13 4Q13 Net Interest Income 6,9.4 6,7.7 6,93.4 7,45.6,27.4 Net Interest Income 1,543.3 1,557. 1,595.9 1,637.2 1,617.5 Non-Interest Income 1,641.7 1,75. 1,5.3 1,97.2 2,5.9 Non-Interest Income 424. 424.5 447. 434.3 444.2 Operating Income 7,7.1,.5,7.7 9,436.,133.3 Operating Income 1,96.1 1,91.5 2,43.7 2,71.5 2,61.7 Overhead Expenses -2,417.6-2,53.6-2,62. -2,76.3-2,9.3 Overhead Expenses -595.7-631. -629.7-611. -63.4 Pre-provision Profit 5,322.5 5,654. 6,9.9 6,676.6 7,2. Pre-provision Profit 1,372.4 1,349. 1,4. 1,459.7 1,431.3 Loan Loss Provisions -279.2-1.3-367.9-327.5-343.3 Loan Loss Provisions -4.2-1.4-76.3-3.3-9.3 Operating Profit 5,43.2 5,33.6 5,792. 6,349. 6,91.7 Operating Profit 1,2.3 1,26.4 1,337.7 1,6.4 1,341. Associates 4. 6.4 6.6 6. 7. Associates 3.1 1.6 2. 1.7.3 Pretax Profit 5,47.2 5,3. 5,79.6 6,5. 6,9.7 Pretax Profit 1,291.3 1,27. 1,3.6 1,.2 1,341.3 Less: Tax -1,17. -1,4.3-1,391.7-1,5.4-1,655.7 Less: Tax -294.7-291.1-36.3-3. -36.2 Tax Rate 23.3 22.7 24. 24. 24. Tax Rate 22. 22.9 22. 22.1 22. Profit After Tax 3,69.2 4,5.6 4,6.9 4,3.4 5,243. Profit After Tax 996.7 97.9 1,34.3 1,57.4 1,.1 Minorities -42.5-41. -43. -45.2-47.4 Minorities -. -.6 -. -.1-9.5 Net Profit 3,26. 4,64.7 4,363.9 4,75.3 5,195.6 Net Profit 91. 96.3 1,23.5 1,47.3 1,.6 Basic shares (m) 3,52.1 3,52.1 3,52.1 3,52.1 3,52.1 Basic shares (m) 3,52.1 3,52.1 3,52.1 3,52.1 3,53.1 Basic EPS (sen) 9.3 116.1 124.6 136.6.4 Basic EPS (sen) 2. 27.6 29.2 29.9 29.3 Balance sheet Valuation ratios FYE 31 Dec (RMm) 12A 13A E E 16E FYE 31 Dec (RMm) 12A 13A E E 16E Cash 1,636 22, 24,6 26,234 2,595 Reported basic EPS (sen) 9.3 116.1 124.6 136.6.4 Invt securities,76 41,224 44,934 4,97 53,36 Normalized basic EPS (sen) 9.3 116.1 124.6 136.6.4 Loans 196,52 219,416 241,296 265,424 291,966 Normalized FD EPS (sen) 9.3 116.1 124.6 136.6.4 Stat Reserve 5,77 6,9 7,617,379 9,217 PER (x) 17.5 16.5.4. 12.9 Goodwill 1,926 2,4 2,4 2,4 2,4 FD PER (x) 17.5 16.5.4. 12.9 Other assets 12,347,76,494 17,27 1,7 Net DPS (sen) 5. 52. 55. 59. 63. Total assets 274,24,7 3,412 36,46 3,7 Net DY 2.6 2.7 2.9 3.1 3.3 Deposits 237,92 267,49 293,43 322,424 4,29 Book/ share (RM) 5.1 5. 6.5 7.2.1 Bills & acceptances 3,49 1,573 1,64 1,1 1,92 P/Book (x) 3. 3.3 3. 2.6 2.4 Borrowings 9,947 9,971,521 11,9 11,73 FCF/ share (sen) NM NM NM NM NM Other liab 5,21 5,9 6,116 6,33 6,497 FCF yield NM NM NM NM NM Shrhldrs' funds 1,1,424 22,45,546 2,517 Market capitalization 67,672 67,672 67,672 67,672 67,672 Share capital 3,532 3,532 3,532 3,532 3,532 Net cash NM NM NM NM NM Reserves,47 16,92 19,313 22, 24,95 Enterprise value NM NM NM NM NM Minorities 7 774 17 62 99 EV/ EBITDA (x) NM NM NM NM NM Total liab 274,24,7 3,412 36,46 3,7 ROE 22.6 21.1.2 19. 19.2 FYE 31 Dec 12A 13A E E 16E FYE 31 Dec 12A 13A E E 16E Asset Quality Profitability Gross Impaired Loan.69.67.62.57.52 ROE 22.62 21..17 19.7 19.22 Loan Loss Coverage 126.2 11.54 13.6 1. 3. ROA 1.46 1. 1.36 1.36 1. Core Capital Ratio 11.41 11.5 11.2 11. 11.51 Int Inc / Loans 5.27 5. 5.11 5.3 4.96 RWCAR.67.29.69.73.7 Int Exp / Deposits 2.29 2.31 2.33 2.33 2.34 Cost / Inc Ratio 31.23 3.69 29.91 29. 2.6 Margins Exp / Avg. Assets.92.6.2.7.75 Yields On Earnings Assets 4. 4.9 4.4 3.99 3.94 Prov / Avg. Net Loans..17.16.13.12 Avg. Cost of Funds 2. 2.19 2. 2.21 2.22 Interest Spread 2. 1.91 1.5 1.79 1.73 Liquidity Unadjusted NIM 2.9 2.1 1.95 1.9 1.3 Loan Deposit Ratio 7.12 7.46 7.44 7.44 7.44 Adjusted NIM 2.43 2.31 2.26 2.22 2.17 Net Loan Growth 11.3 11.6... Deposit Growth 12.31 11.4... Page 1 of 1 il
Financial Projections RHB Cap Income statement Quarterly financial summary FYE 31 Dec (RMm) 12A 13A E E 16E FYE 31 Dec (RMm) 4Q12 1Q13 2Q13 3Q13 4Q13 Net Interest Income 3,45.2 3,65.4 4,57. 4,39.2 4,631. Net Interest Income 913. 912.6 947. 979.3 1,.9 Non-Interest Income 1,375.6 2,4.3 2,271.4 2,43.4 2,6.5 Non-Interest Income 46.3 454.4 49.5 552. 594.3 Operating Income 4,.7 5,969.7 6,32.4 6,739.6 7,232.4 Operating Income 1,374.1 1,367. 1,445.4 1,531.4 1,6.2 Overhead Expenses -2,293.7-3,52.2-3,2.3-3,429.4-3,6.2 Overhead Expenses -717.1-71.1-747. -762. -1.5 Pre-provision Profit 2,532. 2,917.5 3,93.1 3,3.2 3,597.2 Pre-provision Profit 657. 64. 697.6 769.4 1.7 Loan Loss Provisions -.5-44. -293.2-293. -291.5 Loan Loss Provisions -97.3-4.9-4.6-29.9-11.7 Operating Profit 2,33.5 2,469.5 2,799.9 3,16.4 3,.7 Operating Profit 559.7 494. 553. 739.5 63. Associates 1.1 1.2 1.2 1.3 1.3 Associates.6.3.6.2. Pretax Profit 2,34.6 2,47. 2,1.2 3,17.6 3,37. Pretax Profit 56.3 494.3 553.7 739. 63.1 Less: Tax -594.9-627.2-7.3-754.4-26.7 Less: Tax -9.3-13.5-134.5-174.9-17.3 Tax Rate 24.9.4... Tax Rate 26.6 26.4 24.3 23.6 27.4 Profit After Tax 1,79. 1,43.5 2,.9 2,263.2 2,4.2 Profit After Tax 411. 363. 419.2 564. 495.7 Minorities -5. -12.3-13. -13.6 -.3 Minorities -3.2-6.6 -. -5.7. Net Profit 1,74.7 1,31.2 2,7.9 2,249.6 2,465.9 Net Profit 7.9 7.2 4.3 559.1 54.5 Basic shares (m) 2,494.2 2,546.9 2,546.9 2,546.9 2,546.9 Basic shares (m) 2,494.2 2,494.2 2,494.2 2,531.4 2,546.9 Basic EPS (sen) 71.6 71.9 2..3 96. Basic EPS (sen) 16.4.3 16.5 22.1 19. Balance sheet Valuation ratios FYE 31 Dec (RMm) 12A 13A E E 16E FYE 31 Dec (RMm) 12A 13A E E 16E Cash 27,613 12,772 13,566,4,36 Reported basic EPS (sen) 71.6 71.9 2..3 96. Invt securities 36,49 43,746 46,599 49,63 52,7 Normalized basic EPS (sen) 71.6 71.9 2..3 96. Loans 9,277 119,543 131,557 3,53 6,492 Normalized FD EPS (sen) 71.6 71.9 2..3 96. Stat Reserve 3,3 4,171 4,59 5,2 5,452 PER (x) 11. 11.7.3 9.5.7 Goodwill 5,22 5,237 5,237 5,237 5,237 FD PER (x) 11. 11.7.3 9.5.7 Other assets 6,262 5,6 6, 6,7 7,477 Net DPS (sen) 22.1 16.3 24.7 26.7 29.2 Total assets 19,112 191,9 7,79 224,57 242,42 Net DY 2.6 1.9 2.9 3.2 3.5 Deposits 1,67 4,7 169,74 14,613,39 Book/ share (RM) 6.1 6.6 7.1 7..4 Bills & acceptances 3,637 2,76 2,222 2,377 2,544 P/Book (x) 1.4 1.3 1.2 1.1 1. Borrowings,495 9,729 9,729 9,729 9,729 FCF/ share (sen) NM NM NM NM NM Other liab 7,961 7,62 7,737 7,75,1 FCF yield NM NM NM NM NM Shrhldrs' funds,117 16,739 1,197 19,767 21,49 Market capitalization 21,3 21,3 21,3 21,3 21,3 Share capital 2,494 2,547 2,547 2,547 2,547 Net cash NM NM NM NM NM Reserves 12,623,192,65 17,2 1,942 Enterprise value NM NM NM NM NM Minorities 223 4 2 216 223 EV/ EBITDA (x) NM NM NM NM NM Total liab 19,112 191,9 7,79 224,57 242,42 ROE 13.4 11.5 12. 11.9 12. FYE 31 Dec 12A 13A E E 16E FYE 31 Dec 12A 13A E E 16E Asset Quality Profitability Gross Impaired Loan 2.99 2.2 2.32 1.2 1.32 ROE 13. 11.5 11.95 11.5 11.95 Loan Loss Coverage 66.2 63.73 71.23 2.45 4.4 ROA 1.6.9 1.6 1.5 1.7 Core Capital Ratio 11.72 11.65 11.55 11..79 Int Inc / Loans 5.64 5.7 5.4 5.3 5.31 RWCAR.36. 13.3 13.32 12.94 Int Exp / Deposits 2.31 2.63 2.5 2.49 2.47 Cost / Inc Ratio 47.53 51.13 51.12 5. 5.26 Margins Exp / Avg. Assets 1.34 1.61 1.62 1.59 1.56 Yields On Earnings Assets 3.4 3.7 3.5 3. 3.7 Prov / Avg. Net Loans..39.23.21.19 Avg. Cost of Funds 2.7 2.13 2.13 2.13 2.13 Interest Spread 1.77 1.75 1.73 1.6 1.66 Liquidity Unadjusted NIM 1.5 1.4 1.2 1.77 1.75 Loan Deposit Ratio 79.6 6.79 6.3 6.9 6.93 Adjusted NIM 2. 2.17 2.17 2.13 2.11 Net Loan Growth.54 9.17.5 9. 9.5 12A 13A E E 16E Deposit Growth 19.31 -.. 9. 9. Page 19 of 1 il
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As of 1 il, the analyst, Low Yee Huap who prepared this report, has interest in the following securities covered in this report: (a) -. Published & Printed by Hong Leong Investment Bank Berhad (9-W) Level 23, Menara HLA No. 3, Jalan Kia Peng 545 Kuala Lumpur Tel 63 216 116 / 63 27 116 Fax 63 2161 3 Equity rating definitions BUY Positive recommendation of stock under coverage. Expected absolute return of more than +% over 12-months, with low risk of sustained downside. TRADING BUY Positive recommendation of stock not under coverage. Expected absolute return of more than +% over 6-months. Situational or arbitrage trading opportunity. HOLD Neutral recommendation of stock under coverage. Expected absolute return between -% and +% over 12-months, with low risk of sustained downside. TRADING SELL Negative recommendation of stock not under coverage. Expected absolute return of less than -% over 6-months. Situational or arbitrage trading opportunity. SELL Negative recommendation of stock under coverage. High risk of negative absolute return of more than -% over 12-months. NOT RATED No research coverage, and report is intended purely for informational purposes. Industry rating definitions OVERWEIGHT The sector, based on weighted market capitalization, is expected to have absolute return of more than +5% over 12-months. NEUTRAL The sector, based on weighted market capitalization, is expected to have absolute return between 5% and +5% over 12-months. UNDERWEIGHT The sector, based on weighted market capitalization, is expected to have absolute return of less than 5% over 12-months. Page of 1 il