AmBank Group Presentation

AmBank Group Presentation Invest Malaysia 2009, Kuala Lumpur 30 June 2009 Ashok Ramamurthy Deputy Group Managing Director and Group Chief Financial Officer AMMB Holdings Berhad

Agenda Table of Contents 1300 80 8888 (Domestic) (603) 2178 8888 (Overseas) Introduction Structure & Strategy Financial Year 31 March 2009 (FY2009) Outlook Pages : 3 4 7 8 18 19-23 2

AmBank Group a 30+ journey 70s 80s 90s 2000s 2005 1975 Arab- Malaysian Development Bank Berhad was incorporated 1977 Acquired 70% of Arab-Malaysian Finance Berhad (AMFB) 1983 Established Arab-Malaysian Credit Berhad 1988 AMMB the first merchant bank listed on KLSE 1989 Arab-Malaysian Property Trust the first property trust to list on KLSE 1991 Incorporation of AMMB Holdings Berhad as holding company AMFB, Group s finance company, listed. Privatization of AMFB Holdings Berhad AmInvestment Group Berhad (AIGB) listed Merger of AmBank and AmFinance : AmBank (M) Berhad 2006 IAG Limited, Australia acquired 30% equity in AmAssurance Berhad Listed AmFIRST REIT on Bursa AmIslamic Bank commenced operations Asset Size Today RM89.9 9 bil 1984 Acquired Arab-Malaysian Insurance Berhad 1986 Acquired stockbroking firm, Kris Securities Sdn Bhd, (renamed to AmSecurities Sdn Bhd) 1994 Acquired commercial banking (Security Pacific Asian Bank Limited) 2001 AMFB acquired MBF Finance Berhad 2002 Merger of AMFB and MBf Finance Berhad 2007 Entry of Australia and New Zealand Banking Group Limited as strategic partner and major investor 2008 Privatisation of AIGB, becoming a wholly owned subsidiary of AHB Establishment of AmG Insurance Berhad 3

Significant positions in major business Investment Retail Business Islamic Assurance Banking Banking Banking Banking # 2 # 4 # 5 # 5 # 8 # 5 Stay relevant & protect t market share, and preserve balance sheet quality Focus on profitability and build foundations for growth [Commercial bank] Leverage on existing customers, build sustainable assets & deposit bases [General] [Life] To be the top 3 insurer in terms of premiums To become Islamic bank of choice Awards : Best Bond, Best Bond Group, Best Portfolio Manager, Best Deal, League Table Ranked Top 4 in : M&A league Malaysian Ringgit Bond league Funds Under Management Relationship Banking & Regional Business to focus on Corporate & Institutional Banking International biz Singapore, Indonesia and Brunei Dominant auto financier : 21.0% mkt-share; Best Auto Financier # 7 (incl. foreign banks) in housing loans (5.9%) & # 7 credit cards (7.6%) & # 3 in personal financing (7.6%) 5 million customers, >1.4 products per customer # 4 in no. of branches & # 3 in no. of ATM s Pioneer in weekend and extended banking hrs Leverage on nationwide network : 4 regional business centres & 12 commercial centres; and strong relationship managers force Leader in cash management (full suite) and SME financing Expanding trade and remittance leveraging on ANZ s regional network # 2 in motor insurance premiums (9.0%) and # 5 in general insurance premiums (5.3%) # 8 in life insurance premiums (4.6%) Leverage IAG s market and operational leadership in general insurance New strategic partner, Friends Provident, in life insurance Full range of banking products and services according to Syariah principles Newly set-up Islamic funds management division # 2 in Islamic credit cards 4

Diversified (public) and committed major shareholders As at 31 March 2009 AmcorpGroup Bhd ANZ Funds Pty Ltd Employees Provident Fund Board 17.70% 19.17% 17% 15.15% 15% 47.98% 100% AmBank (M) Berhad AMMB Holdings Bhd AmInvestment Group Berhad 100% 70%* Public 100% 100% AMFB AMAB Holdings Holdings Bhd Sdn Bhd 100% AmIslamic Bank Bhd Foreign Shareholding excluding ANZ AmLife Insurance Berhad * Friends Provident Fund PLC 30% 51%^ AmG Insurance Berhad ^ Insurance Australia Group Ltd 49% Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 41.16% 41.10% 38.14% 36.95% 37.15% 34.39% 30.08% 28.38% Ranked No. 23 : Market capitalization RM7.16 billion on Bursa Saham Malaysia as of March 2009 ANZ strategic partnership : ANZ s current shareholding is at 19.17%. ANZ has right to exercise further 5% via exchangeable bonds subject to BNM s approval Dec08 : completed insurance restructuring : Split composite business of AmLife Insurance Bhd (AmLife, formerly AmAssurance Bhd) via transfer of general insurance business to AmG Insurance Bhd (AmG) Shareholding of AmG and AmLife restructured : Increase equity interest by 19% of Insurance Australia Group p( (IAG) in AmG, total 49% Sale of previous 30% equity interest of IAG in AmLife to AMMB Sale of 30% equity interest in AmLife held by AHB to Friends Provident Fund plc In progress of due diligence for acquiring : General insurance business of a local insurance company Stake in Islamic insurance business Bumiputera Special Issue Shares: 96.3 million new ordinary shares to be issued to eligible existing Bumiputera shareholders In progress of confirming participations and Bumiputera status 5

ANZ s Asian presence and aspirations: a significant advantage to AHB On 18 May 2007, the strategic partnership of AHB and ANZ commenced ANZ is the only Australian bank to have been in the Asian region for 40 years, with strategic banking partnerships across 7 countries AmBank is ANZ s single largest investment in Asia, with a total investment of US$696 million This is equivalent to 51% of total investments to date China + Vietnam Laos Vi t Cambodia Philippines ANZ has provided key resources and support to AmBank Director Director Board Dr. Robert John Edgar Alex Thursby Director Mark Whelan Malaysia Indonesia Senior Management Management Group CFO & Deputy Group MD Ashok Ramamurthy Head of Capital & Balance Sheet Management Neville Mallard Chief Risk Officer Andrew Kerr Head of Retail Distribution & Deposits Brad Gravell Chief Operating Officer TBC Head of FX & Derivatives Steve Kelly Head of Market Risk Jonathan Manifold Credit Risk / Portfolio Mgt Glenn Saunders Head of Systems Accounting Ignatius Lim Project Director Mark Lockhart Head of Risk Infrastructure Chung Fui Ken Program Director Retail CoF Christopher Shields ANZ is committed to AmBank s long-term success and aspirations 6

Corporate transformation continues pments Corporat te Develo Privatisation of AIGB : Legal entity restructuring into 4 groupings largely completed : banking, asset management, capital markets and insurance Optimizes Group capital structure Universal banking model enables greater cross-selling Insurance business transformation : Completed segregation of composite license between life and general Streamlined insurance businesses to create specialization Consummated entry of new strategic partner into life insurance Due diligence underway for acquisition of MAA s general insurance business & Takaful stake Established new FX & derivatives unit in collaboration with ANZ Simplified governance committee structures 7

Loans growth focused on viable and diversified segments Group, Gross Loans (before Cagamas) : RM bil 60 41.0 43.6 49.3 53.5 56.9 59.7 40 20 0 2004 2005 2006 2007 2008 2009 Financial year ended 31 March Gross Loan movement (before netting Islamic financing sold to Cagamas) Retail Business / Corporate By Type Loan Composition % 40.5% 20.8% 37% 3.7% 15% 1.5% 17% 1.7% 34% 3.4% 16.7% 85% 8.5% 30% 3.0% 1.2% 24.2 19.5% 2.3% Others 10.0 23.9 Auto Financing 3.1% 12.4 12.0 Mortgage 4.6% 16.3% 16.4% 15.3% 2.2 2.1 0.9 1.0 2.1 0.7 1.2 1.8 Asset Financing Credit Cards LOC Co-Op RM'bil Mar'09 Mar' 08 8.4 Business Banking (ex GLR) 35.6% 5.0 3.7 Relationship Banking & Regional Business 34.9% 2.8 1.8 GLR + ILR Note : 1 Group, Net Income and PATMI based on respective years financial statements; FY2008 based on FY2009 financial statements (comparative) 65.9% 10.6% 21.2% Mar 09 Individuals SME Business 8

Improving trends on NPL & coverage 12 8 Asset Quality Indicators 39.3% 32.2% 7.6 36.7% 56.6% 67.3% 75.1% Loan Loss Coverage FY09 / 08 change : Loan loss coverage 7.8% 60% 20% 4 6.1 4.3 5.8 - RM'bil Net NPL Gross NPL 20% 15% 10% 17.4% 6.1 4.6 5.5 32 3.2 3.6 2.4 2.0 1.5 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 14.8% 10.9% 13.8% 12.4% 9.6% 10.4% FY09 / 08 change : Gross NPL ratio Net NPL ratio Net Provisions charge 2.2% 1.1% 0.4% % -20% -60% 6.2% 6.3% 5% 0% 2.2% 1.9% 1.7% 3.2% 3.7% 1.0% 4.1% 2.6% Gross NPL ratio Net NPL ratio 0.6% Net Provisions Charge Trend on NPL ratios, loan loss coverage and net provisions charge improved year-on-year Contributed by proactive collections activities & tightened risk assessment led by experienced team Better positioned for 2009 / 2010 credit & economic challenges 9

Sound funding profiles Growing sticky deposits ( 12%) (comprises deposits from individuals & government) RM'bil 1.9 12.5 4.9 23.0 3.0 20.2 9.0 23.6 1.4 26.3 10.9 25.5 Mar 07 Mar 08 Mar 09 Individuals Government Biz enterprises Others Customer Deposits by Sources Others Biz enterprises Government Individuals CASA composition Customer deposits grew 15.0%, primarily from deposits from business enterprises ( 31%); CASA grew by 8% 12.6% 11.2% 10.5% Total 42.4b 55.8b 64.1b 1.1 2.2 3.2 36.0 12.6 5.3 2.9 3.2 3.3 3.6 44.2 44.8 RM'bil Mar 07 Mar 08 Mar 09 FD + NID Savings Current Others Customer Deposits by Type Others Current Savings FD + NID Extended the duration of interest pricing profile 12.0% 16.7% 20.0% 9.2% 0.2% 5.4% 3.8% 26.9% 25.3% 25.1% 51.9% 52.5% 51.2% RM'bil Mar 07 Mar 08 Mar 09 0-3 mths 3-12 mths 1-5 yrs > 5 years Non-interest sensitive Customer Deposits : Interest Pricing Profile Non - sensitive > 5 years 1 5 years 3 12 months 0 3 months Reduce dependency on inter-banking funding Total 17.4b 7.1b 6.1b 10.9 1.3 0.5 4.8 2.1 2.9 1.4 0.9 1.4 0.7 2.1 1.6 RM'bil Mar 07 Mar 08 Mar 09 Banks Merchant banks BNM Other FI's Deposits of Banks & Other Financial Institutions Other FI s BNM Merchant Banks Note : 1 FY2007 as per the previous financial statements 2 FY2009 and FY2008 based on FY2009 financial statements with reinstatement for FY2008 (whereby certain deposits previously classified under Deposits and Placement s of Banks and Other Financial Institutions have been reclassified to Deposits from Customers) 10

Improving earnings ratio but more to do REPORTED ROE, % FY 09 / 08 change 0.2% FY 08 / 07 charge 17.3% ROA, % FY 09 / 08 change 0.02% FY 08 / 07 charge 1.19% EPS, basic sen/share FY 09 / 08 change FY 08 / 07 charge 12.1% 312.0% 11.5% 11.7% 1.02% 1.04% -0.17% -5.8% (13.3) 3) 28.2 31.6 FY2007 FY2008 FY2009 FY2007 FY2008 FY2009 FY2007 FY2008 FY2009 Maintaining profitability despite economic disruptions Better utilization of asset resources Note : 1 FY2007 as per the previous FY2008 market pack 11

Stronger capital base to meet ensuing challenges and support growth Capital Adequacy : AMMB Holdings Berhad RWCA 12.6% 14.1% 15.2% 5.4% 3.9% 5.6% 8.7% 8.5% 9.7% 7.6% 7.3% 7.5% FY2007 FY2008 FY2009 Wef 1.1.08, adoption of BNM s RWCAF-Basel II, Standardised Approach for Credit Risk & Market Risk, and Basic Indicator Approach for Operational Risk RWA of Group derived by aggregating RWA of banking subsidiaries Tier 2 Ratio Tier 1 Ratio Core Equity Ratio FY2008 FY2009 Capital ratio by legal l entity Capital Base RWA Tier 1 Ratio RWCA Ratio Capital Base RWA Tier 1 Ratio RWCA Ratio RM'bil RM'bil % % RM'bil RM'bil % % AmBank (M) Berhad, Group 6.8 51.6 7.1% 13.1% 9.0 61.2 9.3% 14.6% AmBank (M) Berhad 5.5 42.3 8.1% 13.0% 7.2 50.8 10.4% 14.2% AmInvestment Bank Berhad, Group 2.6 14.3 13.8% 17.9% 0.6 1.7 27.1% 34.2% AmIslamic Bank Berhad 1.5 9.3 10.3% 16.3% 1.7 10.4 11.2% 16.7% AMMB Holdings Berhad, Group 9.3 65.9 8.5% 14.1% 9.5 63.0 9.7% 15.2% Total RWA has reduced, partly due to changes in BNM s weightage for undrawn commitments. Relatively higher capital ratio as compared with peers Strongly positioned to continue building lending franchises Raised RM500mil NIT1 in 4QFY09 Note : 1 FY2007 capital adequacy ratios as per the published financial statements of AHB for FY2008 12

FY 2009 FINANCIAL PERFORMANCE

Improving financial fundamentals in all areas FY08 1 FY09 2 Change Perform mance Profit after Tax & MI RM 668.5 mil RM 860.8 mil 28.8 % ROE 11.5 % 11.7 %* 0.2 % EPS (fully diluted) 27.9 sen 31.6 sen 13.3 % Growth Net Lending RM 52,574 mil RM 56,948 mil 8.3 % Customer Deposits RM 55,769 mil RM 64,132 mil 15.0 % CASA RM 6,254 mil RM 6,755 mil 80% 8.0 Risk & Capital Net NPL Ratio 3.7 % 2.6 % - 1.1 % RWCA 14.1% 15.2% 1.1 % Tier 1 8.5% 9.7% 1.2 % Note : 1 FY08 12 months of financial year ended 31 March 2008, ie April 2007 March 2008 2 FY09 12 months of financial year ended 31 March 2009, ie April 2008 March 2009 * Impacted by holding higher capital ratio 14

Sound profit growth despite income pressures REPORTED RM mil FY08 FY09 FY09 vs FY08 Business Performance Income 3,351.7 3,270.8-2.4% Expenses 1,536.9 1,612.1 +4.9% PBP Provisions PBT PAT 1,814.8 620.4 1,194.4 810.8 1,658.6 441.0 1,217.6 878.3-8.6% -28.9% +1.9% +8.3% PATMI 668.5 860.8 +28.8% Income : Investment and Regional Banking income adversely impacted by capital market conditions Retail and Business Banking and Assurance performances meet expectations Expenses: Reflects salary adjustments, insurance claims, ongoing medium term investments and CPI Provisions : Improved credit risk, asset quality, NPL collections and recoveries management Provisions include PER build-up and impairment losses FY08 results Favourable growth in FY09 Unfavourable growth in FY09 15

Improved PATMI underpinned by Retail, Business Banking & Assurance PATMI : Growth contributed by Retail, Business, Assurance RM mil FY08 FY09 FY09 vs FY08 Business Performance Retail Banking Division 1 (71.1%) 544.4 615.6 +13.1% Business Banking Division (12.2%) 77.8 105.5 +35.6% Investment Banking Division (5.5%) 159.2 48.0-69.8% Relationship & Regional Banking (5.9%) 49.8 51.2 +2.9% Assurance (5.2%) 38.3 45.1 +17.8% Operating Segments : Reported PATMI -201.0-4.6 +97.7% Retail & Business are main drivers of profit growth Lower investment banking contribution reflects stressed equity and capital market conditions Operating segments : Underlying PAT One-Off s including MI payout FY08 FY09 09 vs 08 853.7 861.6 +0.9% -168.9 +20.1-111.9% MI -16.4-20.9 +27.4% Net Lending 2 : Growth contributed by Business Business Performance Retail Banking Division Business Banking Division Relationship Banking & Regional Business 40,625.8 41,626.3 8,198.1 9,773.4 3,639.3 4,957.3 +2.5% +19.2% +36.2% Retail focus on higher profit segments in a highly competitive environment Targeted growth in Business and SME loans, focusing on more stable sectors FY08 results Favourable growth in FY09 Unfavourable growth in FY09 Note : 1 Bracket denotes composition of contribution to PATMI by business segment 2 Net Lending : net of IIS, SP and GP 16

FY2009 : actual vs consensus Performance Actual Consensus Indicator / Estimates Market Ratio FY2009 March 2009 Actual 2009 vs Consensus ROA (%) 1.04% 0.98% + 0.06% ROE (%) 11.7% 11.0% +07% 0.7% Revenue 3,271 mil 3,224 mil + 1.5% Profit before Tax 1,218 mil 1,145 mil + 6.4% Profit after Tax & MI 861 mil 825 mil + 4.4% EPS (sen / share) 31.6 30.5 + 3.6% Based on consensus as at 15 Apr 09. Earlier consensus for FY2009 indicated a larger positive variance to actual results. Note : Consensus as at 15 April 2009 (source : Bloomberg) Revenue is taken from consensus Sales estimate, PATMI taken from consensus Net Income GAAP estimate, EPS taken from consensus EPS GAAP estimate 17

FY2009 key messages Staying Ahead Record profit performance for FY 2009, exceeding market consensus Sound business fundamentals, business offerings being diversified further Lower provisions and MI payouts are major profit growth contributors Executing medium term aspirations (early 2008) provided a head-start Business Segment Performance Retail, Business Banking & Assurance are the main contributors Investment Banking and Market trading results impacted (market conditions) Asset quality improvements in all areas via lower NPL and provisions Capital, Risk & Funding Well capitalized - Tier 1 CAR of 9.7% and total t RWCAR of 15.2% Proactive risk management Completed raising non-innovative Tier 1 of RM 500m (March 2009) Priorities for 2010 Profitable growth & rebalancing focus via executing on our strategic agenda Dynamic focus on volume versus price trade offs and growth in viable segments, enhanced asset quality focus Target operating cost efficiencies whilst investing for the medium term 18

What is ahead Industry : What is Ahead Global crisis will continue to have impacts on Malaysia (12-1515 months) Valuable lessons have been learnt from the previous financial crisis BNM has commented that the banking system remains strong Growth in lending and risk weighted assets are set to slow down Asset quality will deteriorate & NPLs, whilst at historical lows, are set to increase Banks likely to proactively shore up their capital position, tighten lending criteria and strengthen risk management Malaysia; Headroom to consider additional policy options Economy forecast to shrink in 09 but will grow c. 3.0% in CY10 (internal research) Fiscal spending of RM 67 billion (2009/10) expected to provide some shield External sector contraction will be partly offset by domestic demand Potential ti exists for further loosening of the monetary policies i AMMB; Facing headwinds but sound Executing to AHB s strategic themes will provide greater resilience Enhance risk and governance frameworks Tougher economic conditions, despite disciplined execution, will delay achievement of medium term aspirations ANZ, our strategic partner, is 1 of 11 AA rated banks in the world and listed as 1 of the 20 safest banks globally by Globe Finance Magazine, February 2009 19

Looking ahead for FY2010 Overall Maintain profitable growth & rebalancing focus via executing on strategic agenda Income diversification, cost management and enhanced risk disciplines are key priorities for FY 2010 Position business for potential economic recovery towards mid FY2011 Retail Maintain asset growth focus on profitable segments whilst growing deposits Expect higher income growth from historical fixed income assets (under FTP) Expect increased delinquencies & credit costs Enhanced focus on risk management and collections Expect minimal profit growth for FY2010 Business Proactively manage existing accounts to mitigate higher risk of default Focus on building a sustainable asset base targeted towards stronger industry segments and with greater diversification Enhance focus on deposits & transaction based fees Expect rapid FY2009 profit growth to moderate in FY2010 Relationship & Deepen customer relationships to generate fee incomes & advisory mandates Regional Biz Enhance focus on capital efficient i business growth and loan pricing i to reflect economic risks Expect an improved profit performance over FY2009 20

Looking ahead for FY2010 Investment Banking Uncertain economic environment means equity and debt markets remain subdued Focus on core expertise in advisory and capital market activities Expect stable to rising profit performance over FY2009 Assurance Expect modest growth via revenue increase and efficiency improvements over FY2009 MAA business acquisition may bring in synergies later Markets Biz Focus on reducing volatile exposures & diversifying revenues Market disruption not expected to recur leading to improved fixed income profit performance Expect Markets FX and Derivative businesses to contribute to income growth Risk & Financial Governance Implement new retail tools including 3G scorecards, PD & LGD models Implement new non-retail PD, EAD and LGD models, financial spreading tool and security indicators (collateral management) Implement new FTP and ALM disciplines, Basel II and FRS requirements 21

Holding position for FY2010, achieving medium-term aspirations will take longer FY 07 FY 08 FY 09 FY 2010 Medium Term Aspirations (MTA) PATMI Reported : -RM282.5 mil Underlying : RM468.3 mil Reported : RM668.5 mil Underlying : RM837.4 mil Reported : RM860.8 mil Underlying : RM840.7 mil RM800-900 mil FY2012: circa >RM1.2bil ROE Reported : -5.8% Reported : 11.5% Reported : 11.7% Underlying : 8.9% Underlying : 12.7% Underlying : 11.4% circa 11% FY2012 : circa 15% MTA : 17 20% CTI 1 Reported : 37.1% Reported : 39.6% Reported : 43.0% circa 45% circa 40% Net NPL Ratio Reported : 6.2% Reported : 3.7% Reported : 2.6% circa 4 % FY2012 : 2-3% MTA : below system Dividend gross / payout 5.0 sen / share 6.0 sen / share 8.0 sen / share 10.0 sen / share Payout % system average Note: The achievement of medium-term aspirations is barring negative economic impacts lasting longer and deeper Underlying performance of PATMI and ROE for FY08 adjusted for one-off impacts including restatement as if AmInvestment Group Berhad was a 100%-owned entity of AMMB Underlying performance of PATMI and ROE for FY07 as per previous FY08 market pack 1 CTI excludes all insurance activities (different measurement) 30

Concluding remarks Conclusion 1. Top 5 Banking Group with strong market and brand presence 2. Record FY09 performance exceeding consensus, testimony of the transformation underway to harness benefits from strategic partnerships 3. Well capitalized heading into tough FY10, remain committed on enhancing risk disciplines, collections / restructuring activities & cost management 4. Executing to AHB s medium term strategic themes around profitable growth and portfolio rebalancing, has provided a head-start advantage and will provide greater resilience over the current economic cycle 5. AHB is well positioned to grow and be amongst the top-tiered banks in Malaysia 23

THANK YOU The material in this presentation is general background information about AmBank Group 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 intended d to be relied upon as advice to investors or potential ti investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate. For further information, visit it : www.ambg.com.my or contact Head Group Investor Relations Tel : (603) 2036 1435 Fax : (603) 2031 7384 e-mail : ganesh-kumar@ambg.com.my or ir@ambg.com.my